Larissa Waters (Queensland, Australian Greens) Share this | Hansard source

I rise to speak on the Help to Buy Bill 2023. The proposed Help to Buy Scheme is a reckless housing lottery bill that will ultimately increase house prices. In its current form, the Help to Buy Scheme will see the housing crisis get worse. The government will not fix the housing crisis by pushing up house prices, as this bill would do, making it harder for 99.8 per cent of renters every year to buy a home. The government will not fix the housing crisis by giving a lucky few—very few—more cash to bid up the price of housing at auctions. The government will not fix the housing crisis without touching negative gearing and the capital gains tax discount—those massive tax handouts for property investors that deny millions of renters the chance to buy a home.

In effect, this Help to Buy Scheme will establish a terrible housing lottery where a maximum of 0.2 per cent of renters would get access to the scheme every year while the other 99.8 per cent would find it even harder to buy a home. Now, it isn't just the Greens contending this. Successive economists and housing experts during the course of the Senate inquiry into this bill made it clear that this bill would push up house prices and would in fact make the housing crisis worse.

Alarmingly, the federal Treasury acknowledged that they hadn't actually modelled the impact that the Help to Buy Scheme would have on house prices, and the Help to Buy bills themselves lack basic detail on eligibility and other basic key questions on the operation of the scheme. Schemes like Help to Buy allow people to pay more for housing than they otherwise would be able to afford. This ultimately prices people out of housing. The evidence during the Senate inquiry into the bill was clear. This scheme would benefit only a tiny fraction of potential first home owners while increasing house prices for everyone not lucky enough to win Labor's housing lottery through increased demand.

Even though this is a small scheme, anything that pushes prices up in the middle of a housing affordability crisis is a step in the wrong direction. Last month my home state of Queensland earned the unenviable title of the homelessness capital of Australia. But it's not just my home state. Millions of people are struggling to pay rent or struggling to pay their mortgages, and they're giving up on ever being able to afford to buy a home. No-one in the 10 most common professions across the country can afford to buy a house and avoid housing stress in some figures that we released recently off the back of PBO costing. This is the devastating reality. Homeownership is completely unattainable for most of the country's essential professions. And how can you save for a deposit when you're stuck paying skyrocketing rents? Meanwhile, the Albanese government has put forward this bill that will push up house prices and help almost no-one.

From the moment the bill was introduced, the Greens have been willing to pass the bill if the government negotiated with us on negative gearing and the capital gains discount. Those tax handouts collectively push up the price of housing, which disadvantages renters at auctions. As multiple experts during the inquiry into this bill said, the reality is that we will never tackle the housing crisis until we phase out negative gearing and the capital gains discount. Maiy Azize, who's the spokesperson for Everybody's Home, said:

Scrapping negative gearing and capital gains tax discounts are not just 'nice to haves' or levers that we could pull, it is absolutely critical if we want to make housing affordable in Australia.

Dr John Quiggin, an economist from my home state of Queensland, where he's a professor of economics at UQ, said:

These schemes have been around forever, but the money is eventually capitalised into house prices, so the beneficiaries gain at the expense of everyone else.

Mr Matt Grudnoff, who's a senior economist at the Australia Institute, said:

The Help to Buy scheme, like many previous housing affordability schemes from both major parties, is a policy to boost the financial position of a particular group, usually first home buyers. The problem with these kinds of policies is that they simply increase demand for housing, and this increases the price of housing. The result is that it makes housing less affordable.

Dr Peter Tulip, from the Centre of International Studies, said:

When you stimulate demand, it puts up prices and makes housing more expensive for everybody else.

He said:

We have a housing affordability crisis, and this makes that problem worse for the majority of people entering the market.

That's a pretty clear sentiment being expressed there.

With the money saved from phasing out big tax handouts for property investors, we could fully fund the Greens plan to establish a public property developer to build 610,000 good-quality homes to be sold and rented at below market prices. The majority of the public now support capping rents, scrapping tax handouts for property investors and establishing a public developer to build, sell and rent homes at below market prices, so why does Labor keep siding with property investors instead? Labor will give property investors $176 billion in tax handouts over the next 10 years, while millions of renters and mortgage holders suffer. If the government really wanted to tackle the housing crisis, they would listen to the majority of Australians' calls and directly build homes.

The bottom line is this. There are five million renters in this country, and there are millions more people—including parents of those renters—right now who know that this country is unfair and it's stacked against them, and they're sick and tired of being treated like second-class citizens. Come the next election, I think this government is going to be in for a rude shock when it realises it can no longer keep putting the interests of property developers, property moguls and banks ahead of renters, first home buyers and mortgage holders.

The Greens will keep fighting for solutions that will tackle the housing crisis. We'll keep calling for a two-year rent freeze and winding back negative gearing and capital gains tax concessions for property investors because those concessions are denying millions of renters the chance to buy a home. We'll keep calling for the government to reinvest that money in government built homes, sold and rented at prices that people can actually afford. We remain ready to negotiate a housing plan that actually helps the millions of teachers, nurses and early childhood workers who just want an affordable home. We want to negotiate something that will actually help people. But the government is refusing to engage. They are stonewalling us. This is tragic because we are in a terrible housing and rental crisis. It is a crisis of affordability, and it's the direct result of the failure of public policy choices made by successive Labor and Liberal governments.

The stakes of this housing crisis could not be higher. The latest annual Productivity Commission Report on government services shows that there were 57,519 unassisted requests for accommodation from homelessness services last year. Moreover, there are currently over 170,000 households that are on the waiting list for public housing. People's lives are being destroyed because of insecure housing. The government are aware of the effects that experiencing the housing and rental crisis have on every possible measure of an individual's participation in our community, and yet they put a scheme forward that equates to no more than tinkering around the edges—a scheme that would also put upward pressure on housing prices.

The Greens want to see the government treat the crisis seriously, and that requires large-scale responses. In particular, we would like to see the government use their vast resources and administrative capacity to directly build homes to rent and sell at below-market prices. We'd like to see the federal government offer the state and territory governments incentives to implement an emergency freeze on rent increases. That could be achieved using a mechanism similar to that outlined in the Help to Buy Bill, which refers powers to the Commonwealth. We'd like to see the government phase out unfair tax handouts, such as negative gearing and capital gains tax, which have significantly inflated the price of housing, denying millions of renters the chance to buy a home. The solutions to the housing crisis require far more than just tinkering around the edges through schemes like Help to Buy. The Greens believe that responding to the housing crisis requires structural change—in particular, phasing out those tax handouts to property investors that encourage property speculation and drive up the cost of housing.

Throughout the Senate Economics Legislation Committee inquiry into this bill, that view was made clear over and over again, along with the need for the government to build far more public housing. Professor Quiggin, who I referred to before, explained that Help to Buy allows the government to appear like they're responding to the housing crisis without spending the money required to do so. In comparing the Help to Buy scheme and the Housing Australia Future Fund, he said:

… there was an attempt to deliver the desired outcome while pretending that there was no impact on the budget. The fact is that housing is a major capital investment. If the government wants to have more housing, ultimately the only way to do that is programs which would involve a substantial amount of public debt and a substantial amount of real investment. So I think what we're seeing is another piece of gesture politics.

When asked what policies the government should pursue to respond to the crisis of housing affordability and to ensure that more renters could afford to purchase a home, Mr Grudnoff, who I also referred to earlier, said:

… the most effective policy for housing affordability that the federal government could pursue is to limit negative gearing and scrap the capital gains tax discount. This would discourage property speculators and reduce the demand for housing. It would mean less housing being sold for renting and more housing being sold for owner occupiers. It would increase homeownership rates. This would also raise more than $10 billion per year, which could be used either to build more public housing or for other uses.

That call was echoed by Maiy Azize from Everybody's Home, as I referred to earlier. She said that the reforms are essential to responding to the housing crisis. She said:

Scrapping negative gearing and capital gains tax discounts are not just 'nice to haves' or levers that we could pull, it is absolutely critical if we want to make housing affordable in Australia.

She went on to explain how both the Labor and the Liberal federal governments have created the housing crisis—in particular, through their decisions to implement or to maintain negative gearing and the capital gains tax discount and to underfund public housing. She said:

… the two things that the federal government has done in the past couple of decades to create the crisis that we're in is, firstly, to pull back from supplying housing itself, which it used to do at a much greater scale. About one in three renters actually used to have the government as a landlord and about one in four new builds used to be built by the government. That was key to driving affordability, not just for people on low incomes but across the board. In the decade since, what we've seen is that all the policy levers and investment and incentives have been completely directed at the private sector, which has massively financialised and commodified housing and made it really difficult for house prices to ever come down.

The benefits of tax handouts for property investors are going to the wealthiest in our community, who don't need the help from the public purse. The 2023-24 tax expenditures and insights statement outlined that 82 per cent of the benefit of the capital gains tax discount was received by the top income decile. At the hearing into this bill, Kristin O'Connell, spokesperson for the Antipoverty Centre, said:

It's quite sickening to be a welfare recipient and have the government consistently tell us that they can't afford to give us enough money to live or to invest in public housing and also see hundreds of billions of dollars being handed out to people who are already wealthy.

Ms O'Connell and Emma Greenhalgh, the CEO of National Shelter, also called for stronger protections for renters from unlimited rental increases. Stronger protections against rental increases would help all potential first home buyers and, unlike Help to Buy, would not push homeownership further out of the reach of the majority.

In conclusion, Help to Buy as it's currently proposed fails to address the underlying causes of the housing affordability crisis in Australia. It aims to assist a small fraction of potential homeowners, and its limited scope and demand side approach are likely to exacerbate the housing crisis without offering any of the solutions that the government knows would work, as they did in the 20th century. This is a deeply unambitious policy introduced at a critical point where homelessness and rental and mortgage stress are skyrocketing. The government has the opportunity to work with the Greens and the crossbench right now to start to address these systemic issues that are forcing more people into housing stress and homelessness. Tinkering around the edges will not help the vast majority of people. The scheme's impact on house prices, although minimal in the broader context of the national housing market, represents a misguided allocation of resources that could otherwise be directed towards more effective solutions to this crisis. Please work with us to get good outcomes for people, rather than trying to force these bills on for a vote when you know they won't pass. (Time expired)