Kim Carr (Victoria, Australian Labor Party, Shadow Minister for Housing and Urban Development) Share this | Link to this | Hansard source

My question is to Senator Minchin, the Minister representing the Treasurer. Is the minister aware that the chair of the coalition’s backbench Treasury committee, Mr Steven Ciobo, is quoted in the Age of 6 February 2006 as saying:

Australian real estate is among the most expensive in the world.

…         …         …

Those on lower incomes are struggling to save a deposit for a home. Nearly 9 per cent of Australians spend one-third of their pay on rent and simply don’t have the capacity to put additional money aside.

Does the government agree with Mr Ciobo that Australia is facing a housing affordability crisis? Is the minister aware that, as part of his solution to this problem, Mr Ciobo has proposed means testing the first home owners grant on the basis of household income as well as capping the value of the home that can be purchased? Can the minister indicate whether the government intends to adopt Mr Ciobo’s proposals?

Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Link to this | Hansard source

Can I first say that the most important thing for home purchasers and home owners in this country is to maintain as low as possible the level of interest rates that pertain to mortgages, and we welcome the announcement by the Reserve Bank today that the interest rates will not be moving. That is another reflection of the great economic management which the government have brought to this country. We have stable and low interest rates, which gives consumers, renters and home owners confidence to enter the housing market with a much greater degree of certainty than that which prevailed when those opposite were running this country in the most appalling fashion, which saw interest rates go through the roof and low-income people deprived of any possibility of entering the housing market because of the interest rates inflicted on them by those opposite. So, because of the disgusting record they had in office, we are not going to put up with any lectures from the Labor Party about housing affordability.

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

This is a lecture from your own backbench!

Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Link to this | Hansard source

When it comes to the issues that Senator Evans rightfully draws my attention to, having said that interest rates are the most important factor in relation to housing, the home owners grant that we most sensibly introduced at the time of the new tax system’s introduction was very much and overtly in recognition of the consequences for home purchasers of the introduction of the goods and services tax. We made it quite clear at the time that it would not be means tested, and we have held to that very clear policy from that time forward. This was and is a grant which acknowledges the one-off impact of the goods and services tax on the purchase of a home. It is an appropriate and very popular grant. It is administered by the Labor states, as Senator Carr knows.

We always welcome and encourage the non-frontbench members of the coalition team putting forward their ideas with vigour and enthusiasm. I can attest to that being the case in the coalition party room. I have great respect for Mr Ciobo, his intelligence, his interest in policy development and his concern to ensure that the maximum number of Australians do have the opportunity to purchase a home. But in this case the government’s policy is quite clear, and we will maintain the non-means-tested home owners grant.

Kim Carr (Victoria, Australian Labor Party, Shadow Minister for Housing and Urban Development) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. If the government is doing such a great job on housing, why is it that house prices are now equivalent to six to nine times annual household income, as opposed to three times annual income some 10 years ago? Why hasn’t the government done anything to address the fundamental problems in the Australian housing market or to improve affordability for average Australians? Why won’t the government develop a national housing strategy to address these problems?

Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Link to this | Hansard source

Our national action plan to ensure that Australians can buy houses consists of ensuring that interest rates remain low, that unemployment remains low, that real wages maintain their growth and that the economy remains strong. All our policies have been directed at that and they were totally absent when Labor was in office.