Andrew Bragg (NSW, Liberal Party, Shadow Assistant Minister for Home Ownership) Share this | Hansard source

I'm grateful for the opportunity to make some comments on this matter of urgency raised by Senator McKim. I wish it was that easy that you could just make a couple of changes to the tax code and we would solve the nation's housing problem.

The reality is this: when I look at negative gearing and capital gains tax measures and proposals to increase the amount of taxation, I don't see how increasing taxation is going to result in more houses being built. That is the point made by Peter Tulip, who is a former Reserve Bank economist, at the Centre for Independent Studies. He's made the point that playing around with these things would be dangerous and that, if you did it, there would be a very small change to prices, in fact. He says the change to prices would be between one and three per cent.

If people look at the information that has been published by the tax office, they will know that 70 per cent of the mums and dads who invest in property, thereby providing supply, own one property. In many cases, these are people on average or median incomes doing frontline service roles. This is what they have decided to do. The idea that the government will disrupt them from providing supply and, indeed, their own investment is, I think, very misguided. As I say, if only it were that easy and we could solve the housing crisis by fiddling around with negative gearing and CGT! I wish it were that easy.

The government have now had more than two years, and I would say the central problem with their housing policy is that they are obsessed with what's good for institutions, not what is good for individuals. The last time I looked, the Australian dream was not a dream of big super funds or foreign fund managers; it was a dream of an average worker being able to purchase a house, take on a mortgage and pay the mortgage back. That is what is getting out of the grip of the average worker. The average worker now can't get access to that dream because they can't get a mortgage, and that is something you never hear the government ministers talk about. That is the saddest piece here.

The fact is we are stuck with the government, for now, that is only going to make this problem worse, not better, as you will see if you go through their supply policies—the Housing Australia Future Fund and their housing targets, both of which have failed—and then you go to their only demand-side policy, Help to Buy, which just last week was abolished by the state government of New South Wales. You are not going to solve the supply piece or tilt the scales in favour of first home buyers with a Help to Buy program. Minister Farrell talked about this in question time today, and he actually said that he thought Help to Buy was going to help 400,000 families. They should read their own legislation, because the proposed bill would help 40,000 people over the forward estimates. In a country that needs to build more than 1.2 million houses, 40,000 is not a lot of people. So these are tiny and often misguided solutions.

The other policy the government have developed during this term is what I call their perpetual renting plan. There's nothing wrong with renting, and we should always look for ways to support renters, but we want to give the Australian people opportunities to buy their own homes. The perpetual renting plan is underpinned by giving tax concessions to foreign fund managers. As Senator Waters pointed out in her contribution, the idea that the Australian taxpayer would be giving a tax concession to foreign fund managers so they can build houses in Australia and then rent them out to people, as if we were serfs, is fundamentally misguided.

This is where the Labor Party's housing policy all comes together. On one hand, you've got the Housing Australia Future Fund and the Help to Buy program, all designed to work with the super funds, and then you've got the build-to-rent plan, which is designed to help foreign fund managers. My dream for the short term would be that the government have a housing plan which is about people, not about institutions.