Andrew Bartlett (Queensland, Australian Democrats) Share this | Link to this | Hansard source

I rise tonight to once again draw attention to the major crisis in many Australian towns and cities in the area of housing affordability. It is an issue that I have raised a number of times over the years. It is very disheartening that there is a continuing need to raise it, not just because the issue still exists but also because there has been next to nothing done to try to address it over those years despite the obvious reality that it presents. Time and again calls have been made by me, other Democrats and many others in the community—people across the political spectrum who engage with the housing sector and industry—about the reality of housing on the ground. We have called, time and time again, for a national approach, a national housing strategy and a national housing agenda to tackle the crisis of housing affordability.

We have had summits held in this Parliament House, in Canberra and in other parts of Australia year after year. Bodies such as the various councils of social services; National Shelter and the various state based shelters; other community housing organisations; the Housing Industry Association; people involved in the real estate industry; the Property Council; urban development groups plus trade unions, the ACTU and the CFMEU; and the Australian Local Government Association all agree—despite having different ideas about what needs to be done—that until we can get a clear national strategy, and until we can get a focus put on analysing all of the data and the reality of what is happening now, we will never get clear agreement about where we need to go next and we will never get the kind of systemic reform that has to be made if we are going to have any hope of addressing this very serious problem of housing affordability.

It is now becoming commonplace for people to express concern about how their children are ever going to be able to afford to get into home ownership. That represents potentially a major social transformation and a major social tragedy. In saying that I am not presenting a view that home ownership is the panacea for everything and has to be the ultimate goal. What this does mean is that, without major structural reform, the reality will be an entrenched and almost unbridgeable wealth gap within the Australian community; because the major driver of the growing gap in wealth between the haves and the have-nots now is access to and ownership of real estate. There is a whole group in the middle who are hanging on by their fingernails and who are in debt up to their eyeballs hoping that they can get on the right side of that gap. There will be fewer and fewer who can do that. That will present a major inequality that will be entrenched in Australian society into the future unless we do something about it now.

We have seen again, just in the last day or so, the Treasurer—this guy who presents himself as some sort of expert economic manager and guru—simply try and slam the state governments. He said they have to get rid of stamp duties and if they do then that will solve the housing affordability problem. It is just ludicrous. Frankly, the states are not much better. We have had this finger-pointing, blame-shifting exercise year after year. The states say it is the federal government’s fault and the federal government says it is the states’ fault. Frankly, I think it is everybody’s fault—governments at all levels. This is a government at federal level that has intervened time and time again in a whole range of areas where it has deemed it appropriate, whether rightly or wrongly, to take greater control over. That has been done either directly or through the leverage and arm-twisting that their control of the purse strings lends them.

This is an area where the federal government have absolved themselves of responsibility. I think of the number of times I have asked questions of the government in question time and elsewhere about what they are doing about this issue. All we get is a barrage of abuse and a blaming of the states. Then they say, ‘Our role in housing affordability is to keep interest rates low.’ It is a ludicrous, pathetic, irresponsible, inaccurate and inadequate response. Of course low interest rates are better than high interest rates, but we all know that the level of indebtedness now, and housing based indebtedness in particular, is much higher than it has been in the past for a whole stack of reasons. If you are talking about decent economic management then you need to look at all the different amounts of money that in all sorts of different ways are going into and affecting housing affordability and the housing market.

Negative gearing is the great unmentionable. For some reason we are just not allowed to talk about it. It can be talked about without saying that it should be abolished overnight, but there is a very strong case for looking at whether or not it should be modified in some way. It amounts to a $2 billion subsidy to those who are better off. It is in many ways inflationary and in many aspects encourages the speculative side of the real estate market over those who are simply trying to buy a house to live in. We have the capital gains discounts that were put through this chamber in 2000, I think it was. They provide a massive incentive for more speculation in the real estate area and a massive gain for those who are better off. We cannot even measure how much of that goes into the housing area. We have the first home owners grant. That has perhaps provided some short-term relief for many people, but in many respects it is also an inflationary measure. We have the capital gains tax exemption for the family home.

Again, in raising these things I am not proposing that they all be removed; but I am saying that we have to look at how much goes into that and what impact it has on the cost of housing and on equity issues and what other measures we could look at to address that. Some academics have estimated that up to $30 billion a year—maybe it is only $20 billion or maybe it is $30 billion; it is a hell of a lot of money—in all sorts of different ways is being spent in subsidies. We have all the rent assistance payments now that are going up and up and up. It is well over $1 billion. We have $1 billion in the Commonwealth-state housing agreements. Rent assistance is now more than that. All of those things are going into the mix in an untargeted, ad hoc, bandaid way with no overarching strategy. In many cases the data is not even collected to know where it is going, who it is going to and how it is being applied.

If you look at the first homeowners grant, you see that hundreds of millions of dollars have been spent; and we do not even know who it is going to. We do not even know which houses are being bought for it. We do not know the price of the houses that it is being applied to. We do not know if it is the best way to spend public money. You have got billions of dollars going to this key area of the economy, and raising all of those issues is in no way suggesting they should all be stopped. But it is suggesting it is about time we stopped and had a look at them in totality, and looked at what it means and what their impact is. We are spending tens of billions of dollars a year in various ways or via forgone revenue, and we do not know what impact it is having. We do not know where it is going and we have no way of assessing whether we could spend the same amount of money in a much fairer, more economically efficient and more effective way that would ensure affordable housing for a much greater proportion of the Australian community.

Why won’t we do it? Because nobody wants to open it. There are too many vested interests; it is much easier to just blame the states or blame the federal government. Nothing progresses, and what happens instead is that more and more Australians fall further behind and the housing affordability crisis gets worse. The last time it got to a level sufficient to create some political heat on the federal government, the Treasurer—the great economic manager, the maestro Mr Costello—announced an inquiry. He called in the Productivity Commission. It was a very narrow inquiry. That was enough to get it off the front pages. By the time the commission reported there was enough of a lull for him to just ignore it and blame the states again. He continues to point to that same report and say the states did not take up the recommendations they should have. He is right; they did not. But the federal government did not take up the recommendations the report had applied to the federal government either. It is just continual inaction on all sides, grossly ridiculous policy, not looking to the long term and not looking at the best interests of Australians. What we have at the end of it all is a crisis that is far worse than it was when I first started raising it in this chamber many years ago. It is time for action, and I call on the federal government to show some leadership in this area and to show some courage. (Time expired)

John Hogg (Queensland, Deputy-President) Share this | Link to this | Hansard source

Before calling the next speaker, I remind senators that having mobile phones on in the Senate is disorderly. They should be either turned to silent, left outside or left off.