Ruth Webber (WA, Australian Labor Party) Share this | Link to this | Hansard source

My question is addressed to the Minister representing the Prime Minister, Senator Minchin. Is the minister aware that working families around Australia now spend nearly one dollar out of every three that they earn on home loan repayments? Aren’t first homebuyers in Perth spending 37 per cent of their income trying to pay off their mortgages? Isn’t this the highest proportion of income that working families have ever had to spend paying off a home loan? What impact does the minister think paying another $50 a month will have on these families that are already struggling to meet their mortgage repayments? Why should working families believe anything that the government says about housing affordability when the government has broken its promise to them to ‘keep interest rates at record lows’?

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

What we do know is that the working families that the senator purports to represent would be in much worse condition if they were paying 17 per cent on their mortgages—as they were doing under the Labor Party. Senator Webber cannot get away from the fact that interest rates under us are lower today than they ever were in 13 years of Labor; interest rates today are lower than they ever were under the Labor Party in government. That is the most extraordinary statistic, and it is a fact that they are lower now than they were when we came into office.

What we promised the Australian people was that interest rates would be lower under us than they would be under a Labor government; we will reassert that at this election. We maintain that, based on the record of the Labor Party, the Australian people will believe us again when we say that interest rates will be lower under us than they will be under the Labor Party. When they understand the full purport of the Labor Party’s ACTU-driven industrial relations policy, the Australian people will know that the advent of a Labor government—mismanaging money, as did former Labor governments; mismanaging money, as do state Labor governments—will result in higher inflation and inevitably higher interest rates.

Ruth Webber (WA, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I remind the minister that interest rates rose to 22 per cent under the current Prime Minister when he was Treasurer. Won’t last week’s interest rate rise—the fifth since the government said that it would keep interest rates at record lows—make it impossible for many young Australian families to buy their first home? Does the minister share the Prime Minister’s view that ‘working families in Australia have never been better off’ when many of those families can no longer afford to own their own home?

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

As I said last week, the government, of course, has considerable sympathy for those families on low incomes who are struggling to meet rent payments or mortgage repayments. That is why, under our government, we spend annually $2 billion in rent assistance assisting 954,000 families and individuals and we spend around $1 billion per annum on the Commonwealth-state housing agreement to assist with the construction of public housing. We have spent some, $7 billion on the first homeowners grants scheme and we are doing the utmost that we can to ensure that inflation remains in the two to three per cent band. Under our government, real wages have risen 20.8 per cent during our period in office. Real wage growth exceeds the growth in rentals, which I pointed out last week. Real wages have risen some $850 per month in the last five years, whereas rents have risen $740 per month. So even renters are better off as a result of our policies, which are ensuring that real wages grow—unlike what would occur under the Labor Party.