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

I too rise to make a contribution in relation to Senator Scarr's general business motion. What Senator Scarr is trying to do here is to talk about the government's failure on housing. The next election, which I imagine will be next year, will be an election where the Australian people have a smorgasbord of policy options to choose from on housing. And I think that if people look at any of the information out there they will see that, particularly for under-40s, this is the really big-ticket item. I guess it's good that people have choice and have that smorgasbord. What is bad is that this government has now wasted 2½ years on shifting the Australian dream further and further away for the average worker.

When you work through the supply and demand elements here, it is pretty obvious that if we continue with this government in any form we will never restore the Australian dream, which is basically the idea that the average worker on an average income can buy a house where they want to. That's basically the idea that is being lost now. The average worker cannot buy a house where they want in most cases, because the average house is priced at multiple times their income.

Let's look at the supply issue. We hear the government talking in question time about all their great supply policies, but, ultimately, the numbers don't lie. Eight years ago we were building 225,000 houses in Australia. This year, we'll build about 160,000 houses. Next year, we're projected to build even less than 160,000. On the construction figures alone, we are going in the wrong direction.

The key to understanding that figure is the nexus between migration and housing completions. What we have seen in the last two years is over a million people coming into the country. That is the largest increase in migration since the 1950s, and that is happening at a time when housing construction has fallen through the floor. That is one of the major failings, on the numbers, that we see the government presiding over.

The government has had three main supply policies. The first policy was the Housing Australia Future Fund. It was promised before the last election, and the idea was that the government itself would come in and fund a whole bunch of housing construction. What we've seen is that the government has in fact put billions of dollars into a fund which has built no houses but has spent millions of dollars on executive salaries. It has been a complete failure.

In mid-September, the housing minister, Ms O'Neil, made the first announcement about disbursements from the Housing Australia Future Fund. Apparently, 13,000 houses will be built across the states and territories in Australia. But the minister hasn't told us who is going to get this money. The Senate has made an order for the production of documents in relation to actually just giving us the detail on the statement from 17 September. The Housing Australia Future Fund has been a flop in terms of its ability to build houses, which is why, of course, we were always sceptical about the idea of the government trying to construct these houses itself. Similarly, we have grave concerns about the other funds the government has established, such as the Reconstruction Fund. I think that, in the long run, the government may also regret having gone down this route of establishing these great big boondoggle funds, because they have not been a successful plan so far.

The other supply policy the government trumpets again and again—it's a bit bizarre to hear the '1.2 million new houses' line being trotted out on an almost daily basis, but that's what we hear. The government apparently wants to build 1.2 million houses over five years. Today we've seen more data from the Master Builders Association, saying that the government will be 400,000 houses short. It's a huge failure. When the Commonwealth government has so few levers to pull on housing, why would you make up something that you can never actually achieve and spend all your capital on a policy which you know you will not deliver on?

The other supply policy, which I would say is the most curious and bizarre of the government's supply policies is the idea that the Commonwealth government would give a tax cut to foreign fund managers to come in and do what they call 'build-to-rent housing'. This idea is effectively that a foreign organisation would come in as a pension fund or a sovereign wealth fund—it could be a BlackRock fund, it could be a Chinese fund or it could be a Middle Eastern pension fund or Middle Eastern government fund of some form—and that would be given a tax concession to go into the build-to-rent game. In this case what you see are these organisations building apartment blocks in Melbourne, Sydney or Brisbane, perhaps, and then these organisations renting these out to Australians in perpetuity. They will never be owned by Australians. They will always be owned by foreign sovereign wealth funds and foreign fund measures.

Why would the Labor Party, with its mission to apparently do its best for the workers, want to see Australian housing stock in the hands of foreign fund managers? I don't understand. I'm sure there are a lot of good people trying to do good things inside the Labor Party, but this is a bizarre policy. Perhaps the strangest wrinkle on this is that even the Property Council itself says that the bill, which proposes a tax cut for foreign fund managers, won't even work. Of course, we see organisations constructing build-to-rent properties in Australia. We see it all the time. That is their third supply policy. The Housing Australia Future Fund has built no houses but has spent lots on executive salaries. Housing targets have failed, with no chance of ever getting that one. Build to rent is a bizarre idea—that we'd want to have our housing stock owned by foreign fund managers.

Then we come to the demand side. Apparently we're looking down the barrel of having a double dissolution election, which has been threatened, because of the Help to Buy scheme. Help to Buy was announced in the last election campaign for the Labor Party, the centrepiece of the campaign. When you need to be building more than a quarter of a million houses a year, this is their main policy on the demand side—10,000. It's not a policy for homeownership for people. It's a policy for state co-ownership, where the government would own 40 per cent of your home. It's taken the government almost two years to bring on this bill for a vote. They tried to do it in September, and it was deferred. We hear that they want to do it again, and they want to try and bring on a double dissolution trigger. If it was so important—if this was their best idea on the demand side—then why has it taken two years to bring the legislation into this parliament? It seems that either it's a massively incompetent government or it's been ashamed that it couldn't develop any new ideas after it took the Treasury benches.

This is their only policy for the demand side. What I mean by that is that this is the only policy to help first home buyers. I think everyone accepts that there is an argument to be made here on the demand side—that the scales can be tilted for first home buyers—because we want to see first home buyers get that Australian dream. What we are seeing is a trajectory where millennials and gen Zs will never own a house. That is a trajectory that everyone wants to change, but this is their only solution.

Then we go to what other options you could have to help Australians get that elusive first home. The Senate, in its wisdom, is running an inquiry into lending, but apparently, according to the Treasurer, lending policy is not something this parliament will think about. The parliament won't have any thoughts about lending policy, banking policy or mortgage policy. That's the preserve of APRA. APRA does all that. So his view is basically that we'll just give something as important as a mortgage policy to some unelected bureaucrats to do up in Sydney. They'll do it in the dark. It won't be disallowable, and we'll leave it all to the prudential regulator. That is the view of the Treasurer.

We take the view that it's pretty hard to get a first house without a mortgage, so we think that there are things that APRA is doing, in terms of its mandate and the way that it deploys its serviceability buffer, that warrant examination at the very least and maybe warrant reform. If a serviceability buffer is three per cent above where interest rates are now, at the top of a tightening cycle, maybe that is rubbing out too many prospective first home buyers from the Australian dream. Maybe that is something that the parliament—certainly the government in its attempt to try and thread together a coherent banking and housing policy—should be thinking about, but, so far, we have heard crickets from the government.

Barrenjoey has estimated that, if you were to tweak the serviceability buffer and the capital weights to help first home buyers, you might see an additional 50,000 people come into that market. Of course, all of these projections are always subject to building more houses and providing that supply, but I would've thought that was an important issue to look at.

Of course, then the other issue, on the demand side, is the superannuation issue, and that is the Labor Party's favourite issue never to talk about. They don't think that super can help people get a first home, because their view is that the super funds should hold all the money and invest in housing but it's not a good idea for people to do it themselves. Basically, in their world, your super can invest in any house except for your own.

In summary, on the supply side, we have seen fewer houses than in any time in the last decade. On the demand side, we've seen one idea to help first home buyers, which is stalled in this Senate and, I would say, at this point won't be passed in this parliament. It may feature again at the next Labor Party election launch potentially, but, other than that, the cupboard is bare. So the Australian people will be looking for more solutions than what the government has been prepared to develop during this parliament, and thank goodness for that policy smorgasbord that we'll see next year at the election.