Rebekha Sharkie (Mayo, Centre Alliance) Share this | Link to this | Hansard source

Before the debate is resumed on this bill, I advise the Federation Chamber that in the House it has been agreed that a general debate will be allowed covering this bill and the Capital Works (Build to Rent Misuse Tax) Bill 2024. I call the member for Kennedy, in continuation.

Bob Katter (Kennedy, Katter's Australian Party) Share this | Link to this | Hansard source

I referred to my home town of Charters Towers, and we could not afford to build our humble little Logan unit. My wife cut our land in half, got a surveyor and went and applied to get a subdivision approved by the mines department. The town of Charters Towers was under the Mining Act; it was a mining town. The clerk to the mining warden's court made the decision about whether you got a subdivision or whether you didn't. He looked at the application put in by my wife and said: 'Yes, that'll be right, Suse. Just sign here. Have you got the survey plan there? Yes, thank you.' So he signed the document and he signed the survey plan, and then he stamped both of them. My wife said, 'When can I sell it?' and he said, 'Well, you can go down to the real estate agent and sell it right now.' The next day we completed the sale on the 10 acres, and we were able to complete our house and move into it. It was a very big thing to us as a young couple to get our own house and be able to build the sort of house that we wanted for ourselves—a very humble Logan unit, one of those prefabricated modular houses. But the process took about 15 minutes.

If you go in now and put in an application, the Mining Act has been abolished by the incoming Labor government—one of many things they wrecked in Queensland. So we went under the Local Government Act. If you go in to Charters Towers or any other city or town in Queensland and put your application in for a subdivision, the average time I'm told is now about four years. It was 15 minutes, and now it is four years. Normally it would take you $30,000 or $40,000 to get a report in from the local First Australians that were in a tribe or something some time ago there. Now you have to get a report to them and approved. Then you've got to get one from the environment department approved. Then you've got to get one from the engineering department approved. Then it has to be suitable land usage, and you've got to get that approved. Yes, it's about 4½ years and about $40,000 or $50,000.

I was a member of parliament for 20 years under the Mining Act in a town of about 13,000 people, and I never got one complaint about the Mining Act and its administration—not one single complaint in 20 years. So why did you fix up something that wasn't broken? In fact, why didn't you make all the other areas in Queensland the same as the mining areas? Anyway, you want to placate this group over here and you want to placate that group over there, so we've got to make sure all those things are right. Now, for the price of land, after it was transferred from the Mining Act—with no process at all—to the Local Government Act, there is an enormous process. It went from $7,000 for a vacant allotment to $142,000 in just eight months—and to achieve what? What did you achieve by putting those impositions upon those people?

When I look back on it, we were a freedom party. We had no restrictions on anything. For example, we had no restrictions on guns at all. I saw an AK-47 in a sports store, went over and bought it—with 350 rounds of ammunition—put it in the back of the car and drove all around the Gold Coast for the rest of the day. There were no gun laws at all, except for concealable firearms, and we had eight deaths with guns. Well, in the highly restrictive states: New South Wales had 38 deaths from guns in that year, and Victoria had 54 deaths from guns. We had hardly any deaths at all. We had eight deaths from guns.

Freedom: don't you put any price on freedom at all? How can you possibly say you live in a free country? My grandkids were coming up for a visit, and I said: 'Oh, beauty. We'll get out the air rifles.' My wife said: 'They're not allowed to use air rifles. They're under 16.' I said, 'What is it with my air rifles? They're 65 years old. They couldn't go through tissue paper.' She said, 'They're not allowed.' I said, 'Righto, I'll set up the flying fox'—you know, zoom, zoom, zoom and a splash in the pool. My wife said, 'No, you've got to take the panel off the swimming pool to do that. That's illegal,' she said. 'Yeah, but we don't get any inspectors out here.' We had an inspector out last week. Our fence is almost three centimetres below what it should be. He wants the whole fence renewed, which will cost $3,785. So that's $3,875 to renew the fence because it's three centimetres below where it should be. I said, 'Alright, we'll build the second stage of the tree house.' My wife said, 'No, a kid fell out of a tree house two months ago in Brisbane and tree houses are banned.' Free country? Free country?

I said, 'We'll just go down to the flat.' We've got 10 acres, and all of our neighbours got 10 acres. Why don't we just go down to the flat, boil a billy and make damper. You know, teach them how to make damper'—the most iconic pastime in Australian history. If you go to the National Gallery you'll see how many paintings there are based upon camp fires. She said, 'No, you must get a permit to light a fire in the open and it will take you two or three months to get the permit through, so you can forget about that.' Free country? There's a picture of myself boiling a billy—the most iconic of Australia. This is banned in Queensland! Boiling a billy is banned in Queensland!

If you indulge every imbecile that comes along with a complaint, and it might be a valid complaint, but if you indulge him by persecuting the rest of the bloody population and taking away their freedoms then you end up with what you've got in Queensland, which is one of the most unfree societies on earth. I get a lot of people who come in from communist countries and they say to me, 'We can't believe what it's like here. We come from a free country. In politics there is no freedom. We're not interested in politics. But here you can't do any bloody thing!' That's pretty right. You can't do any bloody thing. I'm sorry to be using the time in parliament to give individual examples, but I do this.

There is a dreadful outbreak of Leucaena, which is an absolutely dreadful thing. It is so thick on either side of the road driving into Townsville that you can't actually walk through it. Never mind seeing through it, you can't walk through it. It contributes absolutely nothing, it's an introduced species, but we had an outbreak at our neighbours—it's just up the hill from us. It's vacant crown land. I paid a bloke to cut it down and poison it all, but I can't burn it! I've got to wait for the fire brigade! By that time, the seed will have blown away and it'll have got away, but I'm not allowed to burn it. I emphasise the issue of freedoms.

We're talking about housing here. We can provide 5,000 blocks of land in Ingham and Charters Towers. They are an hour and a bit away from Townsville—a population centre of over 300,000 people—so you're not living out in the middle of nowhere. It's a city, a very big city by Australian standards. Everything you get in a big city is there. We've got 5,000 blocks and we believe—and we haven't finally established this, but we believe—we can provide the blocks of land for $36,000. We've got to be very careful here because we don't want to collapse land prices in Ingham and Charters Towers, so we're working our way through that problem. But there's no doubt that we can put on the market a house. If it's one hectare allotments, you don't need headworks charges, you don't need storm and floodwater drainage, you don't need kerbing and channelling, you don't need footpaths and you don't need wall-to-wall bitumen. You just have two lanes and a median strip, and that's all you need. You've just taken about $60,000 out of the price of a piece of land by going to one hectare. You can't do that in big cities like Sydney or Brisbane, but you can do that in towns surrounding a population centre like Townsville or Cairns.

We're starting with the Townsville area and we'll move on to Cairns. But we can provide 5,000 homes under $375,000. That's a decent, moderate—but it looks good—home. Some of them are modular constructions and some are different constructions, but they look good. Alright, they're two-bedroom—they're not big houses—but that's what we can provide for you.

For young people, it is a very sad country that we live in. We belong to a dying race. I think this year the figures will indicate that when 20 Australians die they're only replaced by 16 Australians. Have a good look around you, people here, because you won't be here in 100 years time. It will all be gone. Isn't that sad? Isn't that the most ultimate statement upon a race of people when they simply vanish from the gene pool? Isn't that sad? Cleo magazine, no less, did a series of articles on why Australian women don't have children. Only about 15 or 16 per cent said they didn't want children. The vast bulk of them, whilst they wanted children, were putting it off until they had a solid relationship and enough money to settle down and buy a house. There is an element of Christianity in here: you marry for life and you don't just walk out of a relationship when you feel like walking out of it. I'll put that aside for a moment and just say that these young people want to be able to buy a house and settle down before they have kids. They don't get there. Time runs out on them. The body clock runs out. That was the nature of the series of articles in Cleo magazine.

I can't look after the rest of Australia. I'm just saying to come to North Queensland. It is freezing cold here in Canberra, but it's not freezing cold where I come from. I don't even own a jacket in North Queensland! It gets hot sometimes, particularly in places on the coast, but it never gets really hot, because the conditions are overcast all the time. These are heavy rainfall areas. It is not hot and it never gets bitterly cold. It is a beautiful place to live. There's a population centred around Cairns of 300,000. The population centred around Townsville is 300,000. As the leader of our party, Robbie Katter, says continuously, we will get the balance of power sooner or later. Whether it is in this election or in 10 years time, we will get the balance of power. When we do, the Galilee Basin will be opened up. Coalmining will be opened up.

If anyone in this place thinks that a tiny, little country of 26 million Europeans living in the middle of Asia is going to tell India that they can't have electricity, you'll want to think again, I warn you. As Carl von Clausewitz wrote in his most famous book On War, the best book ever written on warfare, its causes and outcomes: 'A people without land will look for a land without people.' Another quote is: 'When goods don't cross borders, then guns will.' If you say to India they can't have coal, 600 million Indians will have no electricity. They don't have any room to put up solar panels in India, let me tell you. That is not an option for them. Nor are windfarms an option for them. They get coal or they go without. I'm one for cutting back a bit. There is the problem of a rising ocean. I won't go along with climate change, but there is the problem of a rising ocean. I've always been for pulling back a bit. At the present moment, they cook with burning grass, cow dung and wood. Is that a better alternative to having an electric stove? Yes, it burns up a bit of coal somewhere, but nothing like what they're doing at the present moment.

We are a vanishing race. We are a race that only exports three things: coal, iron ore and gas. We gave the gas away, so we get no money for the gas. It is gone. Both the Liberal Party and the Labor Party have decided the coal is remaining in place. We will not have any coal—unless you're lying hypocrites, of course; that's possible. But you have said net zero by 2050. The one thing that must mean is no coalmining. I might point out to you that I happen to be a little expert in this field. Silicon is produced by burning coal to smelt— (Time expired)

Dan Repacholi (Hunter, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024. Everyone loves buy-now pay-later. It's almost like the good old days of lay-by, but you get to take the purchase home straightaway with you on the spot. When buy-now pay-later came onto the scene through businesses like Zip Pay and Afterpay, it boomed in popularity, and I can see why. It's a massive help to be able to purchase something that you might not be able to afford on the spot and be able to pay it off in instalments but still have the ability to own the product on that day. I know there are a lot of people and a lot of families, especially in my electorate, who rely on these kinds of payment systems to be able to get what they need when they need it. It's also great for our local businesses in the Hunter. It means that their customers can come in and buy things from their business without having to wait until the time when their bank accounts allow it.

This legislation is about making sure that those who use buy-now pay-later and those who rely on it are protected. This amendment brings buy-now pay-later products in line with other products, like credit cards and personal loans, by making sure that they are regulated properly under the credit act. The regulatory framework is designed to operate in a way that is flexible, adaptable and proportionate to the risk of the consumer's harm.

Buy-now pay-later was a great invention. It usually works by a third party providing customer finance to cover the purchase of goods and services, as well as the payment of bills. The providers, like Zip Pay or Afterpay, pay for the purchase upfront, and the customer then makes repayments in instalments. At face value, it's a great system which is helpful for so many people. But, sadly, the reality is that some people end up in over their heads. They end up having to repay more than what they may be able to afford. Regardless of how good and helpful something may be, there is always the potential for harm.

People ending up in financial hardship because of this must be avoided. Some of the time, this is a result of the providers of the buy-now pay-later businesses having poor product disclosure, inadequate dispute resolution processes, excessive default fees and unaffordable lending practices that lead to hardship and financial stress. This is because, even though buy-now pay-later products are a form of credit, they are not currently subject to the regulatory framework that applies to other credit products.

A product that is used by people to make life more affordable and to relieve the financial pressure of making big but necessary purchases should not lead to even greater financial pressure for those who use it. People use buy-now pay-later to be able to afford what they need, not to dig themselves into an even deeper financial hole than they would have been in if they hadn't used buy-now pay-later. This is why regulation is needed, and it is a must, to make sure that people who use this aren't taken advantage of and aren't finding themselves in positions of hardship financially after using the service.

The proposed amendments mean that customers using buy-now pay-later will be better protected and that the providers will conduct their operations in a way which is better regulated. The amendment will require providers to hold an Australian credit licence and comply with the existing requirements under the credit act, including the regulations for product disclosure, dispute resolution and hardship assistance. The providers will also be subject to responsible lending obligations. However, providers of products that meet strict fee caps, meaning they are categorised as low-cost credit, will have the option to comply with a modified RLO framework that allows certain requirements to scale down the proportion to the risk of the product.

These changes are about making sure that the level of regulation and protection for consumers is just right. They're about making sure that Australians can continue to make the most of the benefits that come with buy-now pay-later while being better protected as they use it. These amendments are wide ranging and help to make life better for Australians in many different areas. I could talk all day about how this bill will help provide for individuals and businesses in the Hunter and all around the country, but, for the benefit of those here listening today, I will keep it brief.

I know that a lot of people in my electorate are concerned about housing. We have been very focused on building more houses in the time that we have been in government. This bill helps to continue with that focus by encouraging investment in the build-to-rent sector, expanding Australia's housing supply. It does this by reducing the final withholding tax rate on eligible fund payments, which are distributions of rental income and capital gains, from managed investment trust investments to 15 per cent, down from 30 per cent. The amendment also increases the depreciation rate for capital works in eligible projects from 2.5 per cent per annum to four per cent per annum.

Medicare is one of the pillars that hold up our country. To be able to access high-quality health care regardless of how much money is in your bank is a right that so many people rely on. We are proud to have introduced Medicare, and we'll always protect it. That's what a Labor government does. Medicare is only made possible by the Medicare levy, but sometimes we need to make tweaks. This legislation ensures that the Medicare levy would not be payable in respect to eligible lump sum payments in arrears. In 2022 the Senate economics committee's inquiry into unlawful underpayment of employees' remuneration revealed an issue. There are existing offsets that compensate individuals for additional income tax and Medicare levy surcharge liabilities incurred as a result of receiving lump sum payments—for example, as compensation for unpaid wages. But these offsets do not compensate taxpayers for any of the additional Medicare levy incurred. We are putting this right, and we expect that up to 3,400 individuals will benefit from this.

Another change being proposed is in relation to multinational tax transparency. In the election we said that we would make sure that big multinationals would pay their fair share of tax, and this change makes sure they will. It's not fair that multimillion-dollar companies pay less tax than a hardworking mum and dad in my electorate trying to provide for their families. These changes are about putting this right.

We're also making changes to the deductible gifts to help encourage giving in the Australian community, which will be a massive help to all kinds of not-for-profit organisations and charities that rely so much on the generosity of Australians to be able to keep providing the amazing services and products that they do every day.

Another area of these amendments focuses on our skills and workforce. The Commonwealth and states have agreed to strengthen Australian skills through a landmark five-year national skills agreement. The agreement sees national cooperation and strategic investment in our vocational education and training sectors. This means that investment of up to $12.6 billion will help expand and transform access to the VET sector, support quality training and implement reforms to address critical skills needs.

There are also proposed changes that offset something for our small businesses. I know that in my electorate there are a lot of people who own their own business, and we need to support them in any way that we can. That's why we're extending the $20,000 instant asset write-off by 12 months until 30 June 2025 to improve cash flow and reduce compliance costs for small business. This means that a small business with an aggregated annual turnover of less than $10 million will be able to immediately deduct eligible assets costing less than $20,000. This is great news for many small business owners in the Hunter and for over four million small businesses across the country.

As you can see, this is a wide-ranging bill that touches on many different areas. But, because of this, people in my electorate will benefit in all kinds of ways, from being better protected when buying now and paying later to being able to get things that they need for their businesses through the instant asset write-off. There really is something for everyone. There are multiple changes being proposed, but they are also necessary changes. I commend the bill to the House.

Max Chandler-Mather (Griffith, Australian Greens) Share this | Link to this | Hansard source

I move the amendment circulated in my name:

That all words after "House" be omitted with a view to substituting the following words:

"(1) notes that:

(a) the Government gives billions of dollars in tax handouts to property investors, driving up the price of housing and denying millions of renters the chance to buy a home;

(b) the Housing Australia Future Fund has not built a single home; and

(c) the median rent in Australia is now $621 and capital city rents have increased 9.5 per cent over the past year; and

(2) calls on the Government to:

(a) freeze rent increases for two years followed by ongoing caps of 2 per cent every two years;

(b) phase out negative gearing and the capital gains tax discount; and

(c) establish a publicly-owned developer to build hundreds of thousands of good quality homes to be sold and rented at prices people can actually afford".

There are a lot of things in the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024 that Labor has bundled together that are completely unrelated to each other, which in itself seems to be a way to avoid scrutiny of key elements of it. Some of the things in this bill the Greens support, but I want to focus in particular on the build-to-rent component of this bill.

Once again Labor is not only tinkering around the edges of this housing crisis; it is bowling up plans that will make this housing crisis worse. How is it that, in the middle of the worst housing crisis that we have seen in generations—millions of renters and mortgage holders falling into severe financial stress, millions of first home buyers unable to buy their first home—Labor's proposal is to give more tax handouts to property developers and investment funds to build rental apartments that almost no-one will be able to afford?

Labor's so-called build-to-rent plan is really just a developer tax break plan that will see developers receive tax handouts for building unaffordable rentals. Labor's claim is that 10 per cent of these apartments have to be affordable. But, before we get to that—even if that were true, which it's not—that means the other 90 per cent, by definition, will be unaffordable. In fact, we know how build-to-rent projects work in this country. We've had plenty of evidence to demonstrate just how unaffordable they are.

Mirvac, in Sydney, is one of the biggest property developers in Australia. The outgoing CEO of Mirvac, by the way, is now the head of Labor's National Housing Supply and Affordability Council, the body that's meant to advise the government on housing affordability. When Mirvac did build-to-rent in Sydney, they bragged to their shareholders about the fact that their rentals were between 15 and 20 per cent above market rent, which basically means that they have a build-to-rent scheme that is driving up rents in the area in which they're building.

Another build-to-rent project, down in Melbourne, saw tenants evicted out of those apartments, and then the apartments were relisted, with $185-a-week rent increases, to over $1,000 a week in rent. This is the scheme that Labor wants to give public money to developers to continue. It has seen 15 to 20 per cent premiums on rent, increases on market rent in that area and tenants evicted so that then the property developer can put the apartments back on the market with massive increases in the rent.

Let's get to the 10 per cent affordable. Labor's definition of 'affordable' in this bill is 74.9 per cent of market rent. That might work if it weren't for the fact that market rents over the last four years have skyrocketed. Let's take an example. For a two-bedroom unit in Marrickville or around there, currently the market rent is around $878 a week. Under Labor's definition of affordable, that rent would be $657 a week. That means a nurse living in an 'affordable' rental under the scheme, earning a gross income of about $80,000 a year, would still have to spend over 50 per cent of their take-home pay on rent—and that's meant to be affordable! I would argue that this definition of affordable demonstrates again just how out of touch Labor are with the experience that renters live day to day. Spending over half of your income on rent is not affordable.

The other thing here is that, in the bill—and this is remarkable—Labor propose to impose forms of regulation on how the rentals can function. They've said that, the first time that these apartments are rented out, they need to be rented out on a minimum three-year lease. This is crucial, because Labor have repeatedly claimed that they can't actually impose any regulations on rentals. But here they are admitting that they could. What they've proposed is a bill where they do have the power and could put caps and freezes on rents that are funded out of this scheme, but they refuse to.

So we have a scheme where public money will go to a property developer in the form of tax handouts to build apartments that almost no-one will be able to afford, which in the past have been rented out at 15 to 20 per cent above market rent. They will then go onto the market, and presumably a renter might be able to rent them—already probably in financial stress. While this developer is receiving public money, they will then be able to increase the rent by as much as they want at the end of that three-year lease period—maybe even during, depending on the agreement. That's 90 per cent of rentals in those apartments.

The other component here is that the bill says that 50 of those rentals have to be rented out at any one time. If a developer builds an apartment block of 100 or 150 rentals, they could literally only rent out 50 and the drip-feed the rest of the apartments onto the market, depending on how much they can get for them. Again we could have a situation where developers are receiving public tax handouts from the government while they are sitting on over a hundred vacant apartments. This demonstrates again that Labor keeps trying to avoid the clear solutions to this housing crisis. They keep trying to find ways to give public money to developers and give out tax handouts, ignoring the fact that property investors already get billions of dollars in tax handouts every year in the form of negative gearing and capital gains tax discount, but they deny millions of renters a chance to buy a home. The sick thing about it is that their solution to the housing crisis, where renters are already paying too much on rent and already facing completely unfair rent increases, is to bowl up a bill where they give tax handouts to property investors to build rentals where they can put up the rent by as much as they want on 90 per cent of the rentals and still get to charge exorbitant rent on the others, especially if they're in places like Sydney.

The reality is that the best form of build-to-rent is government built housing where they build it themselves and rent it out at prices that people can actually afford. There are countries around the world that do this. For instance, in Vienna, in Austria, we have the government and city council helping to build affordable rentals were they rent them out at capped prices, which means that tenants in these beautifully designed rentals that the government helps build and sometimes builds itself rent them at proportions of their income such that they are not paying any more than 10 to 15 per cent of their income on rent.

If the government wanted to solve this crisis—especially the rental crisis—there are three clear things they could do. On this bill, at the very least they could include the idea that, if a developer receives public money, 100 per cent of the apartments could be affordable. They could put a freeze and cap on rent increases on the apartments that are being built under this scheme so that, if a developer is receiving public money, at the very least they're not allowed to jack up the rent by as much as they want. They could do all that but have decided they're not going to, because apparently this seems to be about funnelling more cash into the pockets of property developers, who dictate the government's policy on housing.

Overall, if they want to deal with the rental crisis, there are three clear things the government could do. In coordination with National Cabinet, they could introduce a nationwide freeze and cap on rent increases across the entire rental market in Australia. We know that, if the government had taken their chance when under Greens pressure National Cabinet met last year in August to discuss national rental plans, where all but one person at the table was from the Labor Party. They could have decided to introduce a national freeze and cap on rent increases. It would have saved the average renter over $4,000 on rent, but, more importantly, it would have stopped millions of renters falling into financial stress. It would have stopped thousands, if not hundreds of thousands of people being evicted onto the streets or into their cars, forcing people to choose between paying the rent and feeding their kids. That's what a freeze and cap on rent increases can do. We know it works, because in the government's own housing reports they found that Europe—Europe, which has the most widespread use of rent caps—has the lowest rent increases in the developed world. Australia, with no rent caps outside of the ACT, has the second-highest rent increases in the developed world.

The second thing they could do is phase out the tax handouts for property investors that are denying millions of renters the chance to buy a home. We know right now that the income you need to buy a house and avoid mortgage stress is $164,000 a year. What is a teacher meant to do with that? What is a nurse meant to do with that? What is someone who's just graduated from university meant to do with that? What is a middle-income family meant to do with that? Until we phase out those tax handouts, renters who could buy a home will be trapped in a dodgy rental market where there are unlimited rent increases.

So phase out the tax handouts for property investors that mean, when a renter goes to an auction, they're beaten out by a property investor because they can't afford to compete with a property investor who has thousands, if not tens of thousands, of dollars of tax handouts in their back pocket from this government. Phase out those tax handouts and save the government billions of dollars in revenue that they could then invest in setting up a government owned developer—like they do in Europe, like Australia basically did in the past and like they do across the world, including Singapore—and build hundreds of thousands of good-quality homes and rent them out at prices people can afford.

We're not saying the government has to do it all, but why not get involved in the same way that countries across Europe do, with beautifully designed apartments and houses? Those are solutions to the housing crisis. None of it is radical, because it's done all around the world. All we're proposing are solutions that other countries have used to tackle the housing crisis and ensure that anyone, regardless of their income and background, is able to move in to a good-quality home with rent capped or, at the very least, pay housing costs that they can actually afford and that allow them to go on and live a good life.

None of this is impossible. It's been done around the world. It appears that the only barrier is the power that property developers, banks and the property industry wield over this government, who time and again choose the financial interests of banks, property developers and investors over the interests of mortgage holders, renters and the millions of people being screwed over by a housing system that always puts them last.

Marion Scrymgour (Lingiari, Australian Labor Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Elizabeth Watson-Brown (Ryan, Australian Greens) Share this | Link to this | Hansard source

I second the amendment, and I reserve my right to speak.

Marion Scrymgour (Lingiari, Australian Labor Party) Share this | Link to this | Hansard source

The original question was that this bill now be read a second time. To this, the honourable member for Petrie moved, as an amendment, that all the words after 'that' be omitted with a view to substituting other words. The honourable member for Griffith has now moved, as an amendment to that amendment, that all words after 'House' be omitted with a view to substituting other words. The question now is that the amendment moved by the honourable member for Griffith to the amendment moved by the honourable member for Petrie be agreed to.

Peter Khalil (Wills, Australian Labor Party) Share this | Link to this | Hansard source

I can't think of any issue more pressing to all Australians right now than the cost of living and housing affordability. For years in opposition, across my electorate, people shared their aspirations for good-quality, affordable housing, which was becoming more and more out of reach. That was a story that was reflected across Australia, and it's not a new story. Frankly, it was a problem that deepened, festered and got worse through 10 years of inaction by the previous coalition government. It's an issue that the Albanese Labor government, in our first two years, has been working every day to fix.

As median weekly rents continue to rise, private rentals are becoming increasingly unaffordable for many across Australia, let alone for our most vulnerable. More than 45,000 rental listings across the country were recently examined by Anglicare, and the report found that just 0.6 per cent were considered affordable for a person earning a full-time minimum wage. Only 0.2 per cent were affordable for people on the age pension, and 0.1 per cent for people on the disability support pension. None were affordable for someone on youth allowance. These are unacceptable statistics. For a decade the coalition, when they were in government and sat on the Treasury benches, allowed this issue of housing supply and affordability to fester. They ignored the pleas of Australians for help.

The Albanese Labor government has actually been answering that call to action in the two years since we got elected. Why? Because, fundamentally and philosophically, we are very different ideologically from those on the other side. For us, safe, affordable and secure housing is a fundamental human right. It's fundamentally the foundational aspect for building a better life and for building a good life. It's not just about the economics and commercial value of property. It is a fundamental human right. It's the base from which people can realise their full potential. That's an issue very close to my heart because I grew up in a housing commission, like the Prime Minister and the Minister for Housing; we're housos. I understood, and my migrant family understood, how important having that roof over our heads was when we were starting out in Australia and trying to build a new life.

My message today is very simple: whether you're looking to rent or buy, this government, the Albanese Labor government, is here to support you. Since coming into government, housing has been front of mind. It's been front and centre in terms of our efforts on affordability and supply. We have taken massive steps to rebalance the scales that have been unbalanced for such a long time. As part of this debate, everyone—well, almost everyone—understands that increasing supply is the main issue. Australia doesn't have enough homes, and we haven't for a while. Our priority is simple: to build more homes for more Australians. We need to do it faster while also providing immediate support for Australians that are currently in need. That's why the Labor government has an ambitious national target of building 1.2 million homes by the end of the decade. This is, of course, a big challenge, but it is a challenge we must meet in order to fix what is a long-term problem.

Our recent budget that was just passed added $6.2 billion in new investment to build more of those new homes more quickly, bringing the total commitment of the Albanese Labor government to new housing initiatives to $32 billion just in the space of two years. We're about supporting the building of new homes by growing our construction workforce as well. It's not just about the investment. There are a lot of different elements to this: $1.5 billion has been provided to the states and territories for housing infrastructure works and for more social housing, and there's been direct support through this funding for tens of thousands of new social and affordable homes through our significant investments, including the Housing Australia Future Fund—a fund which, by the way, was delayed by those opposite, by a minor party and by the Greens political party for months, and which could have been used to start building more houses if it was passed. But they decided to play politics with it.

This year's budget is also helping around a million Australian households with the cost of rent by delivering $1.9 billion over five years to increase Commonwealth rent assistance by a further 10 per cent. That's on top of the 15 per cent increase that we announced back in September 2023. Again, this is meant to provide real support—cost of living support—for Australians in need today and now. This is the first back-to-back increase in Commonwealth rent assistance in more than 30 years.

To support these ongoing efforts, we're also introducing the Capital Works (Build to Rent Misuse Tax) Bill, because this legislation actually incentivises investments in the build-to-rent sector, which will help expand the housing supply in Australia. Build-to-rent housing is multi-unit, purpose-built rental housing, where the units, instead of being sold off, are rented out through a single management entity. As part of this bill, at least 10 per cent of homes in these new developments must be rented out affordably, helping to deliver more long-term affordable homes for more Australians. This means that rent needs to be set at 74.9 per cent or less than the market rent of a comparable home in the same project.

Most importantly, who is eligible for these affordable homes? It applies to tenants whose household income is under the required income limits—set according to household composition. The quality of these homes won't be impacted: the bill has provisions in place to ensure affordable homes and non-affordable homes are of equal quality. These measures apply from 1 July 2024, and eligible projects must have commenced construction after 9 May 2023. It's a practice that has been done in the US and the UK as a way to increase the affordable housing supply in the places where people want to live—not two or three hours away from their place of work, because they can't afford to live near the hospital or medical clinic where they work as a nurse or the kindergarten where they work as a teacher or early education teacher.

A division having been called in the House of Representatives—

Sitting suspended from 17:18 to 17:35

As I was saying, this has had a life-changing impact on people overseas, and it also will in Australia. I recently spoke to Michael, a young renter living on his own in Brunswick, in my electorate. He told me what it has been like to experience three rent increases over the last three years, going from paying $2,380 a month in 2022 to paying $2,600 this year. A huge proportion of his wage goes to rent and bills, which doesn't leave much for anything else. Michael, like a lot of others, is struggling to make ends meet. So much of this is linked to housing affordability. Access to good quality, affordable, build-to-rent housing would make balancing the budget so much easier for people like Michael. It would allow him to save up a house deposit of his own, if that were his goal, or to buy a car, travel, or pay off his HECS debt.

By incentivising investment in the build-to-rent sector, the Labor government is increasing supply and bringing housing affordability under control. I know that many Australians are struggling to meet the cost of living at the moment. Rents are rising, and we know that shortages in supply are pushing rents up even higher. That's why this government recognises that more needs to be done to increase rental supply. The government acknowledges that there is a shortage of new rental stock. That's why build to rent is a concept that is already popular overseas and is now going to grow across Australia. It's something that the Albanese government has already introduced to increase the supply of available rental properties. As more build-to-rent sites come to market, this will also help to manage the increases in rental prices.

This legislation we are debating is all about incentivising the construction of those new build-to-rent developments because we want more investment in the build-to-rent sector. We want more of those affordable homes because we want to continue expanding Australia's housing supply. This problem is fundamentally about supply, supply, supply. Everything we are doing is about increasing that supply and addressing the problem. That's why the Albanese government is making a significant investment into housing after a decade of very little or no action from the former coalition government.

Zali Steggall (Warringah, Independent) Share this | Link to this | Hansard source

Before us we have a very large omnibus bill, the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024, packed with seven very distinct schedules. I would say it's a bad habit that the minister has of putting together very disparate issues, which ultimately means you avoid scrutiny on those individual schedules and parts.

There are three of the seven schedules that I will speak to today; three key areas. First, there are the build-to-rent incentives. Although I'm not necessarily confident that Warringah residents will see benefits from these incentives for more affordable housing, they are, nonetheless, very important. Secondly, the bill legislates a $20,000 instant asset write-off for small businesses for the new financial year, starting 1 July, even though it should be noted that the write-off promise for this current financial year has not been legislated. It urgently needs to be done because, ultimately, it misleads small businesses into thinking they have an asset write-off available to them. Also, the scope of that asset write-off, at $20,000, is, I would argue, not sufficient.

Thirdly, there is the schedule concerning buy-now pay-later operators, who will finally be better regulated under the credit act. This will help stem the tide of abuse by some partners or spouses, for example, through these operators. It is a form of family and domestic violence when debts are racked up on behalf of partners. It is also an area where people are unknowingly accumulating huge amounts of debt that have a serious impact on their capacity to meet the costs of living and other areas.

I will turn to the schedule in relation to build-to-rent. We desperately need more houses in the country. There is no doubt. It is very much an issue topical in every corner of the country. I continue to get a huge amount of correspondence from constituents in Warringah worried about housing. It's a generational thing as well, where young people, having grown up in the area, face a situation where it is completely unaffordable to stay anywhere near where they grew up. I'll be hosting a forum on this in a few months, because of course it is incredibly complex to solve this problem of getting more housing supply but also having it affordable.

In Warringah we have some of the highest property price increases when it comes to purchasing a property but also some of the most expensive rents in the country. We know there is a significant amount of housing stress, and it is incredibly difficult, because we are also bound by an ocean on one side, and we do not have the public transport infrastructure necessary to go into any kind of higher-density building in our area. We know housing and cost-of-living stress are biting, especially with those high rents. One of our local charities, One Meal Northern Beaches, is providing record numbers of meals to those facing food insecurity as a result of soaring rental and energy costs and many other aspects. We know households and young people are under stress. They are incredibly burdened with HECS debts and other areas of debt. We simply must be doing more.

As I've said a number of times, every tool and lever need to be looked at to alleviate the housing crisis that we're currently in. It is—make no mistake—a result of years and years of policies, from both sides of government, that have incentivised people to view housing as an investment strategy. Unfortunately, with that has come now a situation where housing supply has not kept up with the population. We need systematic reform or it will get very much worse. I agree that we must have policies from government that ensure that housing is available to everyone in our society.

The government has committed, through this bill and this schedule, to build 1.2 million houses by the end of the decade, and reducing the acute shortage of new rental stock is absolutely fundamental to achieving this. The government has been unveiling several new initiatives to help tackle the crisis, and this bill provides another piece of the puzzle—build-to-rent tax incentives. These provisions will go some way to alleviate the lack of supply of rental properties, at least in some parts of the country.

Some aspects of this bill are encouraging, including the eligibility criteria—that is, a minimum number of dwellings of 50 or more, and minimum lease terms required to be for three years. These build-to-rent developments must be held under single ownership for a minimum of 15 years, providing stability and certainty to renters—something very few renters experience in the market currently.

It should be clear that the current build-to-rent market in Australia is basically at a standing start. It just hasn't had focus. It makes up a tiny 0.2 per cent of the current housing market. Compared to other countries, we are just way behind. In the UK, it's at five per cent of investment, and in the US it's at 12 per cent of housing supply. There the model has helped expand housing supply.

In Australia, to date, the build-to-rent market has been focused more on the higher end of the market. It is encouraging that this bill intends to increase rental supply more broadly—including in the affordable housing area, with a requirement for 10 per cent of the dwellings to be tenanted on an affordable basis. Of course the question of 'an affordable basis' is very dependent on regions and geography.

That is where the difficulty is for Warringah. We have some of the highest rents in the country, and so that 'affordable basis' is unlikely to be of much assistance here. CoreLogic data shows that renters in Warringah are paying a median rent of over $1,100 per week, compared to $627 per week across Australia. Affordable housing is defined as the rent payable being set at 74.9 per cent of rent payable in a comparable dwelling in an open market. Given the astronomical levels of rents in Warringah, a rent set at that 74.9 per cent may still not be affordable for people on lower incomes, especially for the frontline service workers and essential service workers who we are ultimately trying to incentivise with this scheme. I'm concerned that they are likely not to get that benefit in Warringah. So I would encourage the government to start showing more precision in its policy-making on housing.

I'd encourage the government to do more when it comes to other areas. For example, this legislation is—as is other legislation from the government—consistently silent on housing initiatives and building standards. So, if we're going to be putting public money and tax incentives towards these kinds of projects, I would ask the government, urgently, to consider that, right around the country, we must take into account climate resilience in everything we build. Everything we are paying for, everything we are incentivising, must be climate resilient, or we will have a situation where it will be short-term supply that will be at risk, and then we will have public money needing to come in because of emergency funding when disasters strike.

We know housing is a wicked policy area. The government talks up the big numbers that they have been investing, but I think there needs to be a reality check on how much will actually be delivered when it comes to some of the building projects and the supply.

The government needs to remember that places such as Warringah—higher socioeconomic areas—as well as others have a variety of need for housing and that cookie-cutter solutions won't always work during this crisis. Things like going back to thinking about having boarders—having rooms for rent within homes—and having a tax incentive that incentivises, for example, granny flats, and those kinds of things, can also assist with supply. So I would urge the government to think outside the square and have more solutions on the table.

Another schedule in this legislation is the small business instant asset write-off. It's interesting. We now have it back on the table. It was announced in the budget again for this next financial year. Ironically, a year ago, we had the same announcement in the budget; that asset write-off was there and promised to small businesses. But that legislation hasn't passed in this financial year. So, if a business did a purchase, hoping to be able to rely on that measure, it has essentially got a couple of weeks—it has run out of time, essentially.

It's been quite disappointing to see that there have been political games played on this, where the government has refused to negotiate or to put anything more on the table, and, on the other hand, we have seen the coalition and the Greens move for it to be amended, which obviously has budgeting issues as well. I support that it be increased. We know small businesses are suffering enormously, with high interest rates and high and rising insurance costs—and I should note that the highest inflationary items for small businesses and households are in fact those rises in insurance premiums—and high energy prices, staff shortages and low consumer confidence. There is just a perfect storm.

Small businesses are the backbone of our economy. They make up 97.3 per cent of businesses in Australia. In Warringah we have a vibrant hub of economic activity. We have over 8,000 small businesses, which employ many people, and some 12,000 sole traders.

My office and volunteers recently undertook a survey of small businesses in the electorate, and, whilst it's not finished yet, there are some clear issues that have come out. Those are around taxation, cash flow, inflation, red tape and government regulation. The IR changes have certainly made it more difficult for small businesses, and, of course, everything has been going up, including rent, utilities, insurance and wages. Recruiting and keeping qualified staff is an issue, and, right now, 43 per cent of small businesses are not breaking even. So this should be at the forefront of the government's focus.

In March this year, COSBOA reported that 1,000 businesses became insolvent—the worst result on record since 2015. Approximately three in four business owners are taking home less than the average minimum wage, because usually, in small businesses, the business owner works in that business and, ultimately, does not take a wage for themselves. Organisations like COSBOA are reporting and advocating on behalf of small businesses that more needs to be done by the government to support them. So, whilst I welcome this relief measure, I am concerned that it wasn't available in this financial year, and we need to do more.

Instant asset write-off is undoubtedly a useful tool for enhancing small-business cashflow and encouraging investment. The feedback is generally positive. Small businesses in Warringah have expressed concerns, though, that the temporary nature of the provision makes long-term business planning incredibly difficult. I think this should be made more permanent, with a larger fixed amount to provide certainty and stability for small businesses. We absolutely need to support small businesses to electrify to become energy efficient and increase savings. We need to help them decarbonise, because that can make a huge difference on their way as well. Inclusion of the energy incentive, again, could have further assisted small businesses to buy heat pumps, cooling systems, batteries and more efficient appliances, like fridges and lighting—so many areas can, and should, be made better for them.

Finally, I welcome that buy-now pay-later is finally going to be regulated as a form of credit. Until now, these services have largely been unregulated, and they have caused harm amongst our most vulnerable. In particular—and it's quite frightening—these services have caused harm amongst those suffering from family and domestic violence. Good Shepherd, a provider of family violence and financial wellbeing services, have said that perpetrators may coerce women to sign up for a buy-now pay-later account or fraudulently use their personal details to accrue debts through buy-now pay-later. Equally, victims-survivors may be forced to turn to buy-now pay-later services when access to their money or ability to cover living expenses is controlled or restricted by an abusive partner.

In fact, in 2022 a University of Sydney study found that one participant had suffered financial abuse from a former partner who had accrued $9,000 of debt with 12 buy-now pay-later services. She told the study: 'I had a poor credit rating, but I was still approved for every provider. I missed so many payments and never received any assistance—just fees.' So it is incredibly important to now bring buy-now pay-later, a form of purchasing, under similar regulation to other forms of credit. We know there is still an issue with this current form of legislation. There's an assumption that debts of under $2,000 are okay or assumed to carry lower risk of harm, but the legislation could better protect people by limiting that $2,000 further. We know that we have to combat financial abuse, and this is a complex area.

Andrew Wallace (Fisher, Liberal National Party) Share this | Link to this | Hansard source

I rise tonight to speak on the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024 and the Capital Works (Build to Rent Misuse Tax) Bill 2024. I will briefly set out the seven schedules before I descend into a bit of detail. Along with the Capital Works (Build to Rent Misuse Tax) Bill, schedule 1 implements tax incentives for build-to-rent developments, and an associated misuse tax as a compliance measure for incorrect claims against the BTR concession. Schedule 2 implements long-awaited regulatory reforms for the buy-now pay-later sector. Schedule 3 implements a Medicare levy exemption for lump sum payments. Schedule 4 implements public country-by-country tax reporting for multinational companies with a commercial presence in Australia. Schedule 5 legislates the budget measure to list entities as deductible gift recipients. Schedule 6 amends the Federal Financial Relations Act to give effect to payments to the states, associated with 23 October national skills agreement and any success agreements. Schedule 7 extends the instant asset write-off at an asset cap of $20,000 for the 2024-25 financial year.

In relation to the build-to-rent scheme, every Australian knows just how hard—it doesn't matter where in the country you are living. Everywhere, everybody I speak to is talking about not just a cost-of-living crisis but a housing crisis. When I was the Chair of the Standing Committee on Social Policy and Legal Affairs, I did a very detailed inquiry into housing and homelessness, and we identified the wall of problems that was heading our way. I'm really sad to say that we are nowhere more advanced in relation to resolving those problems; in fact, it's worse. Madam Deputy Speaker Sharkie, I know that you know just how bad is in regions and electorates like yours. But it's not confined just to country areas or remote areas; it's in our cities as well.

I was speaking to a constituent just last night who, sadly, is going through a divorce. She's a nurse with two young kids, and she was talking about when she would have to sell the family home. She was saying: 'Where am I going to live? I've got two little kids, two little girls. I'm going to end up with virtually nothing out of the marriage, and where am I going to live?' She's a nurse. So does that mean one of our frontline workers has to move to Gympie, Kingaroy or somewhere else? The problem with the Sunshine Coast, as beautiful as it is, is that it's being loved to death. Everybody wants to move to the Sunshine Coast, and prices have gone through the roof. You can't buy a house on the Sunshine Coast now—even the most terrible house—for under $700,000. It's really almost impossible to rent a home now for under $500 a week. Organisations like ACOSS tell us—and I think it's pretty well accepted—if you are spending more than 30 per cent of your income on either rent or mortgage payments, you are in housing distress.

A report came out just recently—just this week—that talked about the Sunshine Coast in particular. It said that frontline essential workers like police, like nurses, on a single income like the lady I was talking about, are priced out of not only buying a home but even renting a home on the Sunshine Coast now. If you are a single-income earner and you're an essential worker, you can't live on the Sunshine Coast. That is an absolute tragedy. It's an absolute tragedy because how are we going to get our police? How are we going to get our nurses? It's all well and good for us—and I am fortunate in that I own my own home and we are seeing significant increases in value in homes—but I really despair for the young people like the young woman that I was speaking to last night. I despair for my adult kids. I don't know how they're ever going to buy their own home if they haven't got one now. I've got only one out of four who's got their own home. This is a wicked problem.

Those members opposite talked the big talk about how they were going to make housing cheaper. How can those members opposite talk about making housing cheaper when interest rates have gone up 12 times under their watch? On 12 occasions interest rates have gone up. Do you know what the value of the average mortgage in Australia is now?

Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Link to this | Hansard source

Is it $700,000?

Andrew Wallace (Fisher, Liberal National Party) Share this | Link to this | Hansard source

It's $750,000. Can you believe that? I didn't believe that when I first saw it. Do you also know how much those same people with an average mortgage are paying in mortgage repayments above what they were paying when the coalition was in government?

Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Link to this | Hansard source

I'm going to say over 20 grand a year.

Andrew Wallace (Fisher, Liberal National Party) Share this | Link to this | Hansard source

It's $25,000 after tax. For the sake of the maths, let's call it $24,000. That's $2,000 a month after tax, over and above what they were paying when the coalition was in government, that the average mum and dad have got to find to make their mortgage repayments.

An opposition member: Go and get a second job and pay 50 per cent tax!

No, it's not just a matter of getting a second job. It's a matter of maybe even getting a third job.

Then you've got to look at what this is doing to the fabric of families. When I'm out there doorknocking at homes in my electorate—and I'm sure the same goes for all members in this House—people are really badly hurting. They are hurting, and they are angry that they've been sold a pup. They were promised cheaper mortgages. The Prime Minister, during the election campaign, stood up and said 'Support me, vote for me, and I'll ensure you'll have cheaper mortgages.' That's what he said. Let's call it $24,000; let's do a bit of a discount. It's $24,000 a year after tax. Where did that promise go? Then of course he promised Australians that they would be paying $275 a year less in energy bills. How did that one go?

Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Link to this | Hansard source

Down the tube.

Andrew Wallace (Fisher, Liberal National Party) Share this | Link to this | Hansard source

Down the tube—definitely down the tube. We know that the average family is now paying somewhere around about $1,250 dollars a year more on their electricity bill than what they were paying under the coalition government. But fear not! The very generous Treasurer, in the last budget, has provided Australians a $300 energy rebate. The Prime Minister and the Treasurer have the gall to stand up in the House of Representatives and say, 'You're getting a $300 discount on energy bills,' totally disregarding the over $1,200 more that people are now paying. It's kind of like punching someone in the face and then stopping and expecting them to thank you. This government talks the big talk about cheap, renewable energy, but everyday Australians are not seeing it.

This government talks about the importance of the build-to-rent scheme and about providing homes to Australians, but we learnt only about a month ago, probably not even that, that this government has spent $30 million—that's three-zero—on their Housing Australia Future Fund. Do you know how many houses they've built? I'll give you a clue: it starts with 'Z' and ends with 'O'. Donuts. Thirty million dollars, for not one house to be built. Only a Labor federal government can deliver that. So when they come out and talk the big talk about this build-to-rent scheme, you will excuse an old chippie for being a little bit sceptical about this government's plan to resolve the housing crisis that we now find ourselves in. This government is all about providing mechanisms for institutional investors to own these build-to-rent schemes. The big super funds and foreign companies will own these build-to-rent schemes. They will be the ones that invest in these build-to-rent schemes.

At the same time, we know that there is a push within certain segments of the Labor Party to try and take away taxation benefits from mum-and-dad investors who have residential investment properties. So it's okay for a big super fund to own homes, and it's okay for a big super fund to rent homes to Australians, but it's not okay for you. It's not okay for a mum-and-dad investor to own or to have that aspiration. We saw this when Paul Keating tried to outlaw negative gearing. The floor fell out of the residential investment market, because residential investors—mums and dads—just said: 'We're out of here. We'll go put the money in the stock market.' We saw that, and we know that there are people on the government benches who would like to see negative gearing gone. Certainly, we know that the Greens do not believe in negative gearing.

We also know that, after the next election, it is entirely possible that we could be in minority government, where a Labor government is in some form of coalition or power-sharing arrangement with the Greens. And we know that the Greens have consistently said that they are absolutely, ideologically opposed to negative gearing. If this government is reliant upon the Greens for their ability to stay in power, God help this country. You can rest assured that, if that is the case, there will be very, very significant pressure brought to bear by the Greens on the Labor government to eliminate negative gearing. And then it will be history repeating itself—repeating what happened with Paul Keating. Residential investors will desert the market. And where will we be? Where will renters be? It is a real problem, not a fanciful problem, and this government needs to come out and support residential investors.

Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Link to this | Hansard source

As has been said by previous speakers, there are seven schedules to the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024. I only plan to speak to two of the schedules, with one being schedule 1. Schedule 1, along with the Capital Works (Build to Rent Misuse Tax) Bill 2024, implements tax incentives for build-to-rent developments, and an associated misuse tax as a compliance measure for incorrect claims. I don't have a problem with this, in the sense that this is a policy to give incentives and tax incentives for people to build houses that are then going to be rented out. You could say, 'Well, that's good.' I'm not saying that's bad. What I'm saying is, 'Why are we limiting this, and why is this a rent-only policy?' What I read into this is that this government is not interested in people who would like to build and/or buy their own home as owner-occupiers; it is only looking to assist people who are happy to build places to be rented out.

Again, the way this is designed is really for big investors. This is about corporate funds or industry super funds that would then look to invest heavily in this market to then rent those places out. You might say, 'Well, why would Labor only be interested in helping those like industry super funds invest in housing so that they can rent these houses out, but not in helping people who want to be owner-occupiers get these same types of advantages?' Do you know what the answer is? The answer is: it's because the people who run those industry super funds are the unions. What the Labor government is doing here is setting up a vehicle and an incentive to make it easier for the industry super funds. I don't have a problem with industry super funds and the role that they play for people's retirement. But, again, what this shows is that the industry super funds—which are basically run by the union movement and, as we know, the Labor Party is also run by the union movement—have come up with a scheme and said: 'Well, we want to get our industry super funds into home ownership. Let's set up a scheme that makes it easier, so we have incentives to do that, and then we'll build them and rent them out.'

You might say that's okay. You might say that's not okay. But for those people who say it is okay, I would say, 'This is selling out the Australian public who want to be owner-occupiers.' That's what this is doing. This is ignoring mums and dads out there or people who may be single who want to buy and invest in their own home. This does nothing for them.

Why have they designed a scheme like that? I highlight that, again, this is the industry super funds, run by the union movement, and the Labor Party, run by the union movement, coming up with a scheme that is good for the industry super funds, which are the unions, which are run by the Labor Party. There's a whole little circle here as to why this is focused solely on that.

On the housing issue more broadly: the member for Fisher, who spoke earlier, raised some very good points. With all due respect to the government, we have some huge issues with housing. Deputy Speaker, I'm sure it's the same in your community. We've had, I think, 800,000 people come to Australia under this government in the last 12 months. Again, I like migration. I don't mind. We've been a country that's been built on migration for a long time, and I think it's been a great thing for our country. But this government has allowed so many people to come in so quickly that we haven't had the infrastructure and the housing built to maintain that. That's been a huge issue that this government has contributed to.

To point the finger at someone other than the current government, as an opposition member, I'd also raise another point here, and I'd like to put it on the record. As to the housing shortage, this government, through its migration program, brought in many people, without having a plan to build more houses or incentives for people to build more houses. While that is a problem, I'd also point the finger very squarely at the two other levels of government: state and local government.

I find that, across the country, the big problem for housing, for us, is local government. Every house and every apartment that you want to build in this country has to go through a local government DA approval process.

I can speak of my own patch. I have a housing development that's 2,000 or 3,000 houses on a beautiful hill overlooking Lismore. Do you know how long that's been on the books, Deputy Speaker? I know you can't say anything, but, if you said to me, 'Ten years,' I would say, 'No—more,' and you'd go, 'No!' and then if you said, 'Twenty years,' I'd say, 'Deputy Speaker, no, it's more,' and if you said, 'Thirty years,' I'd say, 'Yes. Right on it.' That approval, to get those 2,000 or 3,000 houses, has been on the books of the local council for 30 years. This is outrageous! The green tape and red tape around this proposal has held it up. It's been referred to state planning. It's come back from state planning. There's been another process because people don't want it to be built. The local council itself—a Labor-Greens council—at the start didn't want to approve it anyway and didn't want more homes for families. Work that out! That dragged on for years and then suddenly they changed their mind.

I think you could almost say it, I agree with the Prime Minister. He had a go at the Greens crossbench one day and said that he didn't know of any housing approval in his electorate that he's ever seen a Greens local council member vote for! I could say the same. I don't think I've seen a Greens member of my local councils—and I've got six of them within my electorate—who's said, 'Yes, I vote to approve that development proposal to go through.'

And what, we've got a problem with lack of housing. Yes! This whole NIMBYism has to be called out. You can't have someone who lives in the country who thinks, 'When you build my house, that's good, but once you've built my house I don't want one built next door in the paddock! I like looking at the cows, so let's not build anymore, because you've just built mine.' That obviously isn't sustainable for our country and for our communities. Obviously, in the city—I don't live in a city—you can't say, 'I'll build a high-rise but don't build a high-rise next to me.' This whole NIMBY attitude that once I'm here nothing can happen around me is not sustainable for our country, and it's a big problem.

Anyway, moving on from housing, the next thing I would like to talk to is schedule 7. While I'm not opposed to this, I think the government should be doing more. Schedule 7 extends the instant asset write-off at an asset cap of $20,000 for the 2024-25 financial year. Deputy Speaker, you've been a member of this chamber for a long time—and I congratulate you on being here for such a long time—and you've seen a lot of things happen. The one thing that I think we'll all remember—I was here for the period—were the COVID lockdowns. I think we all went into the COVID lockdowns thinking, 'How is this going to work? We're all going to send everyone home, we're not going to work, what's it going to do to businesses, and how's this all going to roll out?' There were obviously a lot of things we, as the previous government, did. There was the job payment, and when everybody started going back to work and we were trying to keep things together, we did something else.

We'd already instituted the instant asset tax write-off earlier and we had it at $20,000 and we'd increased the size of businesses that could apply for it. Almost the day that we implemented this as a policy in the previous government, I had businesses around my electorate saying, 'Kevin, this is a really good policy. This is a really good incentive for us.' Then what happened during COVID was—and I think this was the game changer—we made it unlimited. There were businesses that were making significant capital investments and being able to have an instant asset tax write-off for it. You had things like people buying big machinery worth hundreds of thousands or millions of dollars, and the order books just started to fill up. The incentive that gave to invest in this country was a very big life changer. Without exception, travelling the country at the time as an assistant minister, people were telling me, 'Kevin, this is the thing that has saved my business.' JobKeeper was great. JobKeeper was essential, but post JobKeeper when everybody started to say, 'We're allowed to come back to work,' with limited things they could or could not do, the instant tax write off was it.

We have put an amendment to this. We think the instant asset tax write-off should be higher. We've indicated that we would make it $30,000. I think, and some other speakers have made the claim too, that this needs to be a permanent fixture within what we do, because—Deputy Speaker, you'd know this—as a country we succeed. We make money in this country and that's a good thing. I don't see making money, increasing your income as a family, making money as a small business, making money as a big business or making money as a country as a bad thing. That is a good thing because the more money we make as a government and the more money we generate as a government the more money we have to spend on social services and government services.

What are the four or five things that we make our money from in this country? We make money out of coal, we make money out of iron ore, we make money out of gas and we make money out of farming. They are the four biggest exports in this country.

I'll take the interjection.

Allegra Spender (Wentworth, Independent) Share this | Link to this | Hansard source

What about higher education.

Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Link to this | Hansard source

Higher education isn't in the fourth biggest.

Allegra Spender (Wentworth, Independent) Share this | Link to this | Hansard source

It's No. 4 actually.

Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Link to this | Hansard source

It was. In fact at one stage it was No. 2, but it's still recovering.

So they are a big export industry. All those industries ran off the tax. To have those industries succeed and remain competitive, you need a couple of things. We used to have low energy costs in this country. The lower taxes you can have helped that as well. We historically have had low energy; we don't anymore. Our company taxes are lower than they used to be. The company tax rate used to be over 50 per cent; it's now around the 25 to 30 per cent, depending on the size of the business, so they're a lot lower, but we certainly aren't as low as a lot of other countries. There are countries that we compete with around the world that have a company tax rate of 20 per cent, and some are as low as 15 per cent. We're not supercompetitive there, but we have to help make sure that our industries—because we want all those industries to make money. Those industries all pay a lot of tax. Those industries all pay a lot of people. They employ people, and those people pay pay-as-you-earn tax. A lot of the mining-type companies pay royalties. So we need them to remain competitive.

The $30,000 is obviously a very minor thing for those bigger companies, but anything we can do to make us a lower-cost country is a good thing. We won't talk about energy today, but certainly we need to maintain whatever energy cost price advantage we can. I support the fact that the government is extending this, but again I would encourage the government to increase the rate of this and always to look for our country's financial sustainability. We talk about sustainability in a lot of things, but to keep our companies sustainable, to keep income and the revenue this government connects sustainable, any lower taxes and tax write-offs we can give are a good thing.

Allegra Spender (Wentworth, Independent) Share this | Link to this | Hansard source

Finding somewhere affordable to rent in Australia is near impossible. Nightly news bulletins across Australia filled with footage of rental inspections queued out of the doors and cities and regions are like. Data from CoreLogic shows that rents have increased by 8.5 per cent since last year alone and 33 per cent since 2021. Meanwhile, wages are rising at just over four per cent a year. In March 2024, PropTrack found that less than 40 per cent of advertised rentals were affordable for typical-income household.

The rental market is sometimes forgotten in the debate on housing affordability, with reports instead focusing on homeownership, but the reality is that a functional and affordable rental market is important for job movers, students and young people, temporary migrants and many more, including older women. This is not to mention that a high cost of renting pushes back homeownership for those who aspire to own their own homes. It also adds pressure to our inadequate public and social housing system. The most recent national data we have, from 2022, shows that 175,000 people are on the waitlist for social housing—a number that has undoubtably worsened as the private market has increased in price. To their credit, the government has introduced several policies that aim to use what levers the federal government has in the space. I supported measures such as the HAFF as I have supported measures to increase Commonwealth rent assistance, while noting that the increase did not go far enough.

The build-to-rent sector is a small-but-growing part of the Australian housing supply. EY have previously estimated that build-to-rent represents only about 0.2 per cent of the value of housing stock. This is compared to five per cent in the United Kingdom and 12 per cent in the US. Estimates suggest that it could grow to around three per cent of housing, with an additional 180,000 dwellings by 2028. At this point in our housing market, all options need to be on the table. This bill will increase the capital works reduction from four per cent to 2.5 per cent and reduce the final withholding tax on managed investment trusts from 30 per cent to 15 per cent for eligible build-to-rent developments. According to Hamilton Locke, this would bring withholding tax in line with commercial property as well as reduce the depreciation period by half. However, these conditions are subject to build-to-rent conditions, including a requirement for 10 per cent of homes to be available as affordable.

This bill is important, and I support the action taken, although I am cautious about an early celebration. The measures included need to form part of a package that makes the development and construction of housing in Australia more viable to investors. Tax settings alone will not lift our housing approvals and completion numbers that sit at record lows. We need to find ways to free up capacity in the broader construction sector to lower the input costs of development. According to the ABS, construction costs are actually up by 30 per cent on 2019 values. The Property Council has also warned that these measures to bring build-to-rent investments in line with other types of property are undermined by the mandated provision of affordable housing. Acknowledging the need for more affordable housing, the Property Council have advocated for a differentiated withholding tax of 10 per cent for affordable housing investment or for other forms of additional incentives to be applied.

This also highlights a current issue we have with the inconsistent definitions of affordable housing. In New South Wales, for example, affordable housing is defined as housing not requiring more than 30 per cent of income, which is often incongruous with how affordable rents are set based on a 20 to 25 per cent discount off the market rate. Even with this discount, supposedly affordable housing in my electorate of Wentworth is still well above what a low-income household could afford.

While I acknowledge the concerns of the Property Council and others, I am hesitant to vote against a bill that seeks to add to housing supply, as I'm hesitant to move amendments to adjust the investment attractiveness of BTR by removing provisions for affordable housing. I understand that a delicate balance needs to be struck between the provision of affordable housing and investment attractiveness, and I also understand that affordable housing does not work for every development proposal. But ultimately, with vacancies and housing approvals at their current levels, I'm not assured that the market will accommodate the needs of all renters under the current conditions. The government will, however, need to monitor the settings in this bill and adjust accordingly if the desired outcomes are not met.

Secondly, I'd like to talk about another key component of the bill: small business and, in particular, the $20,000 instant asset write-off for small businesses. I strongly support the measure, just as I was supportive of the same measure put forward last year that is still yet to pass this parliament. Small businesses are doing it tough, and I speak to many of these in my electorate and have very strong memories of running a number of smaller businesses myself and of the real struggles, to be honest, during periods of economic downturn and uncertainty, as you try to make sure that you can continue to provide employment for those that you employ but still try to meet the needs of your customers, which can vary, particularly in situations where there is economic uncertainty. You can see, in the numbers, the difficulties for small businesses. According to ASIC, the number of insolvencies has increased by 36.2 per cent since March last year. That is a huge rise. Measures such as this $20,000 instant asset write-off provide much-needed support to small business in hard times by making it easier for businesses to acquire or upgrade assets essential to their businesses, like a new car, a coffee machine or other infrastructure that they need.

But, when government makes promises in budgets that it's not able to meet, the business community loses faith, and I think that this, in the last budget, has been a really terrible example. I have been speaking to small-business owners recently who, until the past week, were unsure if the measures in the budget from last year would be passed in this financial year. It's 26 June today, and in the last month there was much uncertainty about whether these measures would be passed in this financial year. So people who listened to the budget announcement last year and said, 'Oh, great, I've got the instant asset write-off,' may have gone out there and purchased an asset, expecting to write it off—but not following the machinations of parliament, not realising that the legislation wasn't actually passed—and they're now dealing with that uncertainty.

Even if the legislation passes this week, the ABC reports that for many it will be too late to make the necessary purchase before the deadline. I think this is so wasteful, frankly, at a time of economic uncertainty and at a time when small businesses are doing it so hard, to not be able to deliver the outcomes that small businesses are expecting, relying on and taking the government's word on. I'm pleased to see that a deal has finally been struck to pass the previous year's bill, but the inability to do this before—they're literally sneaking it in before 30 June—really undermines the business community's confidence in government. I think the government must do better in this space. We must support our small businesses and give them much more certainty in their dealings with government so that they can feel certain that, when the government says that they're going to do something to support small business, it actually eventuates.

Sam Birrell (Nicholls, National Party) Share this | Link to this | Hansard source

Looking at this piece of legislation, I'm reminded of this phrase: it's a riddle wrapped in a mystery inside an enigma.

Andrew Wilkie (Clark, Independent) Share this | Link to this | Hansard source

Churchill.

Sam Birrell (Nicholls, National Party) Share this | Link to this | Hansard source

Correct. Winston Churchill used this phrase in October 1939, and he was trying to describe a situation that was difficult to comprehend. That's where I find myself. The Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024 and the Capital Works (Build to Rent Misuse Tax) Bill 2024 are not that difficult to comprehend individually, but why they are proposed together in the same bill is incomprehensible. That is the riddle.

It's a bit of a pattern for the Albanese government. I find it a source of frustration that bills with only a passing acquaintance are all presented as inseparable in the same piece of legislation. Some call it 'omnibus'. I think the reason for this is obvious—wrap up a bit of bad legislation in a bundle of good measures and tie a pretty bow around it. The strategy is that, in order to pass the good, the bad will be accepted as part of that package. Or, to put it another way, to vote against the bad would also be a vote against the good.

I am someone who comes to this place willing to support good legislation but happy to debate the bad and, if necessary, vote against the bad. There's been a bit of bad in this term of government, I'd have to say, from my electorate's perspective. I vote against it. The legislative strategy is incomprehensible, and it's really hard to tolerate. Politics may be the art of compromise, but it shouldn't be reduced to having to choose the lesser evil. A bad idea is a bad idea, and bad legislation is bad legislation. That's my frustration with pulling all these unrelated pieces of regulation together in the one bill.

When it comes to buy-now pay-later, historically, there is a problem in my electorate with vulnerable communities being targeted with rent to own for common household items, like refrigerators and televisions. In some places, there's a lack of financial literacy, and this can be exploited. People sign up to pay thousands of dollars more for the item, and they're often targeted again toward the end of the contract to sign up for a new replacement and thousands more dollars. Buy-now pay-later has in many ways superseded that rent-to-own concept. I get that both of them have pros and cons and that both require regulation and consumer safeguards. That is what this bill does for buy-now pay-later.

I'm made aware that the buy-now pay-later sector has over five million Australian customers. Buy-now pay-later had near-universal consumer awareness in the RBA's 2022 consumer payments survey. The majority of people who told the RBA that they had used buy-now pay-later services in the previous 12 months were aged between 18 and 39 in the 2019 survey, but by 2022 the use had more than doubled for those aged 50 and over. So age seems to be no barrier to what consumers accept is a convenient and cost-effective way of making a purchase.

This bill imposes new regulation on buy-now pay-later providers, such as Afterpay and Zip. These reforms are supported in principle. Indeed, the industry sector is broadly supportive of these reforms, but the coalition remains concerned about significant delays in drafting this legislation and failures to address concerns raised by buy-now pay-later providers. These products play an important role in helping people manage their finances and smooth out expenses, and it's an alternative to high-cost forms of credit, like payday loans and credit cards, but it would have been good to see some measures in this bill about promoting the financial literacy of consumers. I think that's something we should all aspire towards.

Another part of this seven-schedule omnibus bill is the build-to-rent misuse tax. The build-to-rent misuse tax will create generous tax incentives for institutional investors to develop build-to-rent housing, BTR. This is part of what the Albanese government wants to do to add rental supply through the reforms in the 2023 budget, announced more than 12 months ago.

The legislation has faced delays, but it's also faced criticism during consultation from the sector it is intending to support. Labor seems to be prioritising corporate homeownership over individual homeownership. This is a corporate housing policy which will create a generation of renters. I still believe that in my electorate you can come and find places where young people can still save for a deposit and still buy their own home. It's one of the great advantages of living in regional Australia.

When it comes to the instant asset write-off, the coalition's position, as outlined in the budget in reply, is to extend the value of assets eligible instant asset write-off to $30,000, allowing businesses to claim accelerated depreciation on a wider range of assets. Our position would simplify depreciation for millions of small businesses just by cutting that red tape, boosting investment in productive assets and lowering business costs and prices. Every decision we make in this place should be about how easy is it to do business, how easy is it just to start a business and how easy is it to run a business? A lot of people on our side, and some people on the other side, have been involved in private enterprise, and that's what I was involved in for the entire time before I came into this place. I have huge admiration for people who are prepared to take a risk on their capital, combine it with labour and the creativity and cleverness of the people they employ and create something.

In my part of the world that creation is often fruit products that I hope people in this place enjoy, and everyone's welcome to come to my office for the Australia-China blind tasting of peaches—open invitation to everyone!

An honourable member interjecting—

I welcome that. SPC is the business that has been processing that Australian fruit in my electorate for so long. It's a very special part of my electorate. My grandparents worked there. Everyone in Shepparton has got a story about being out on the farms, picking the fruit, working on an orchard, working in the factory during their holidays or knows someone who worked in that place. I want to see that business continue to be competitive, and I think it's really important for Australia that we do that. What we want to do is make it easier for them to do business and to prosper in that business.

Labor's proposal will limit the instant asset write-off to $20,000. If Labor supported our amendments then 26,500 businesses with an aggregated turnover of up to $50 million would have been eligible to use the instant asset write-off. The increased asset of $30,000 would have allowed businesses to claim accelerated depreciation on a wider range of assets. When it's getting really hard, when inputs are increasing, labour costs are increasing, regulation is increasing—too much, in my opinion—anything we can do to help those businesses with that bottom line is so important. I think all of this would have come at a modest cost to the budget, and we would have seen it returned in spades by the increased profitability, productivity and sustainability of these really important Australian businesses.

The passage of this bill will give certainty to business, but it is not a win for small businesses struggling under cost-of-living pressures from this government. I think it's bad economic policy for difficult times. There are a number of other elements, including country-by-country tax, reporting, payments to states associated with the October 2023 National Skills Agreement, budget measures, the list of entities as deductible gift recipients—there's so much in this bill that I don't think belongs in the same bill, and that's a bit of a cause of frustration. It's not the first time I've spoken on this issue. Maybe people might call me new and naive, but I think splitting up these bills so that we can debate each regulation, if you like, and each law on its merits is a better way, rather than throwing everything together and forcing us to vote against something because we have to weigh up how much we don't like some of it compared to how much we do like other parts of it. It is a frustration.

As I have said, some of the elements are uncontroversial and some are worthy of support, like the instant asset write-off—which is good but should go further—and some should be opposed. I think the build-to-rent tax incentives ought to be removed from the bill and considered separately. So it's a frustrating one, because I think there's a lot of good stuff in here, but it's very difficult to support.

Stephen Jones (Whitlam, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

I start by thanking all the honourable members for their contribution and participation in the debate on the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024 and the Capital Works (Build to Rent Misuse Tax) Bill 2024. I note the contribution made by the honourable member from Nicholls, who preceded me. He made the point that has been made many times in this House over the 15 years that I've been here—about the same time as you, Deputy Speaker Wilkie—that, with omnibus bills like these, you'll find stuff in there that you like and stuff in there that you don't. If we debated them all separately, we'd be spending more than 365 days a year in parliament. I'm sure the member for Nicholls is as keen as I am to get back to his electorate and deal with the other stuff that is pressing upon members of this place. We try to deal with debates in the House efficiently by putting all of the Treasury portfolio measures within the same bills. There is nothing novel about this approach.

The bills before the House deal with, as the titles suggest, regulation of buy-now pay-later, an important piece of credit market reform. It follows on from other work that we've done in the two short years that we've been in government in regulating credit markets—small-amount credit contracts and consumer leases. We introduced a raft of reforms late last year to lift the bar and regulate those credit markets. Buy-now pay-later is an outlier. If anybody walked into a shop, they would see, at most retail outlets, that you can pay by Mastercard, you can pay by Visa and you can pay by Afterpay or Zip. The simple fact of the matter is they all operate like credit but are not currently regulated in the same way.

The objective of these bills is to ensure that there is a base of regulation that treats them all as consumer credit and regulates them all under the National Consumer Credit Protection Act. We're not trying to drive square pegs into round holes. There are differences and variations in some of these products. The small-amount credits, which are available under these products, are regulated slightly differently, but the overall obligations are similar. Scaling to risk is the essence of this, ensuring that we are imposing greater obligations for greater risk and greater potential harm.

Although I'm enjoying the fact that the majority of members who have participated in this debate support these reforms, some are overreaching in suggesting that their side of politics was either interested or did some stuff in this area, when the simple fact of the matter is that it wasn't until this government brought these matters before the House that any action was seen on them. There have been some contributions, although minor, around the tax transparency stuff, which my colleague the assistant minister for the Treasury, Andrew Leigh, has been working on and which uplifts and puts Australia, if not at the top, near the top of the world in the area of requiring multinational corporations which operate in Australia and elsewhere to provide country-by-country tax transparency reporting. It matters for a whole bunch of reasons—not least of which is other areas of government decision-making.

I want to stress, as I have had representations from some other countries, that what we're attempting to do here is not single out a country but definitely single out the behaviours of certain companies who may not be doing the right thing by this jurisdiction. That is our concern—to ensure that people are paying the correct and fair share of tax in our jurisdiction. I'm pleased to see that, eventually, the coalition have come onboard with the instant asset write-off. Not before time, this week we have seen the measures that were introduced in the budget before last pass through the Senate. That delay created enormous uncertainty for small businesses, who have perhaps delayed making purchases because they were uncertain about whether there would be access to this $20,000 instant asset write-off. It is good news for them that there is now certainty in relation to the 2023-24 tax year, but this measure extends those provisions to the 2024-25 tax year. I just say to those on the other side of the chamber: can we get behind this? You say you're for small business. Can we provide them with some certainty by ensuring this has swift passage through the other place?

Finally, a lot of heat and words have been exchanged over the build-to-rent measures. I note that once again the member for Griffith is encouraging this chamber to entertain unconstitutional measures by requiring the Commonwealth government to introduce rent freezes. He knows full well—or he should by now; he has been banging on about this for two years—that we can't do that. It's good for TikTok, but it's not good for the credibility of this place for us to be calling for these things. The simple fact is that we need a lot of measures to deal with the housing issues. I don't pretend for one moment that the build-to-rent measures that we've included within this bill are the solution overall to all of the housing pressures. But proving up an asset class and ensuring that there is more rental accommodation in our cities, which are short on all forms of accommodation, including rental accommodation, is a part of the solution, and that's why we put it forward in this bill.

With all of those comments made, I thank the members once again for the lively debate around this bill. We won't be supporting either the second reading amendment or the foreshadowed substantive amendments. We commend the bill to the House.

Andrew Wilkie (Clark, Independent) Share this | Link to this | Hansard source

The original question was that this bill be now read a second time. To this, the honourable member for Petrie moved as an amendment that all words after 'That' be omitted with a view to substituting other words. The honourable member for Griffith has moved as an amendment to that amendment that all words after 'House' be omitted with a view to substituting other words. The immediate question is that the amendment moved by the honourable member for Griffith be agreed to.

Question unresolved.

As it is necessary to resolve this question to enable further questions to be considered in relation to this bill, in accordance with standing order 195 the bill will be returned to the House for further consideration.