Annette Hurley (SA, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Prime Minister, Senator Minchin. Is the minister aware of comments by the Prime Minister, in 1995, that ‘owning a home is part and parcel of the Australian dream. It ought to be part and parcel of the dream within the reach of battling Australians’? Is the minister aware that families now need to earn $120,000 a year just to meet repayments on a median priced mortgage, compared to $46,000 in 1996? Doesn’t the average home now cost the equivalent of seven years wages, compared to just four years wages in 1996? Don’t average mortgage repayments now use up one dollar in every three earned by working families, compared to one dollar in six in 1996? Isn’t it clear that home ownership is now nothing but a dream for many working families that the Prime Minister claims to represent?

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

I do not exactly recall the 1995 statement, but I accept the veracity of Senator Hurley’s statement. It is something that, logically, a Liberal leader would say, because one of the great things about the Liberal Party is that we are very dedicated to ensuring that the maximum number of Australians are able to own their own home. That is why our policies, since we came into office in 1996, have been directed to ensuring that real wages continue to grow—and they have grown by 20.8 per cent—and to ensuring that we get unemployment low to ensure that the maximum number of Australians can have a job if they want a job. The only way you can afford to own a home is to have a job, and we have unemployment down to 4.3 per cent—levels undreamed of under the Labor Party. That is why we have been dedicated to eliminating deficits, returning the budget to surplus and getting rid of the Labor Party’s debt. All our policies are dedicated to ensuring that we create circumstances in which the maximum number of Australians are able to aspire to own their own home. The rate of home ownership in this country does remain, internationally, at very high levels. The rate of home ownership in this country is remarkably stable. About a third of people have paid off their home, about a third are paying off their home and about a third of people rent. Those levels have been remarkably stable throughout our period in office.

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Senator Conroy interjecting—

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

What the senator is referring to really is the fact that, despite all our good policies, or maybe partly as a consequence of the strong economic growth this country has had, there has been the interaction of demand and supply for housing which has forced housing prices up. It is a fact that the price of housing has increased. Why has the price of housing increased? Well, demand has obviously risen because we have low inflation and we have had relatively low interest rates under our period in office. We have had an extraordinarily strong economy and very high confidence at consumer and residential level which gives consumers the confidence to borrow funds to invest in their own housing. The problem with the housing market is that you do not have an adequate supply response to the obvious increase in demand. Why don’t we have a supply response? Because guess who controls the supply of land? State and local governments—we have six state Labor governments who control the supply of housing.

Opposition Senators:

Opposition senators interjecting—

Paul Calvert (President) Share this | Link to this | Hansard source

Order! Senators on my left will come to order.

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

For those in the opposition who are concerned about the cost of housing, all you have to do is ring the six state Labor premiers and say, ‘Hey guys, how about releasing a bit more land?’ That is the secret to ensuring that the supply of land matches the increase in the demand for housing. The fact is that urban Australia occupies 0.3 per cent of the land mass of this country. Why is it then that, in a country like ours, we have shortages of land supply? It is because, primarily, the state Labor governments are artificially restricting the supply of land to the market, and they have the appalling contradictory position of being involved financially in this. In my own state of South Australia, they have a land corporation which profits from withholding land and forcing up the price so that they can profit from it. It is the most extraordinary contradiction in terms that I have ever seen. If the Labor Party is concerned about ensuring that housing is more affordable, pick up the phone, ring the state Labor premiers, demand more land release.

Annette Hurley (SA, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. Isn’t it this federal Liberal government’s failure to honour its promise to keep interest rates at record lows that has ended the dream of home ownership for young Australians and their families? Given that home ownership is now out of reach for many families, can the minister indicate whether he shares the Prime Minister’s view that working families in Australia have never been better off?

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

We have honoured our promise to ensure that interest rates remain lower under us than under the Labor Party and the fact is that interest rates today are lower than they ever were under 13 years of Labor. You on the opposition side should be ashamed of yourselves that, in all your time in office, you could not get rates as low as they are today—that is a remarkable statistic. The fact is rates are lower today than when we came into office, so we have honoured our promise of 2004 to keep rates lower than they ever were under the Labor Party.