Jenny McAllister (NSW, Australian Labor Party, Shadow Cabinet Secretary) Share this | Link to this | Hansard source

I rise to speak to the Treasury Laws Amendment (2021 Measures No. 3) Bill 2021. This bill implements a number of minor Treasury law amendments and measures from the 2021-22 budget. At the outset, I can confirm that Labor will be supporting this bill.

Schedule 1 of the bill increases the low-income threshold for the Medicare levy, changing thresholds in line with changes to the consumer price index. The Medicare levy low-income threshold, beyond which the Medicare levy is not required to be paid, is currently $22,801 for individuals. This will increase to $23,226 following the passage of the bill. These changes affect single households, pensioners, families and students and will keep the Medicare levy payment thresholds in line with inflation.

Medicare is one of Australia's greatest achievements, and it is the envy of other countries. But, once again, the Liberals have been caught trying to cut it. While the rest of us are focused on health, our communities and the economic impact of the COVID-19 pandemic, it is absolutely on brand that the Liberals decided to take this opportunity to sneak through cuts to Medicare funding for vital surgery. Let's be honest about what's happening here. We're in the middle of a global pandemic, the biggest health crisis for 100 years. Sneaking through an attack on Medicare should not be their priority.

Over the past eight years, the cost of seeing a doctor has gone up and wait times are longer, especially in rural and regional Australia. I know that in the town that I grew up in on the Far North Coast sometimes it is not possible to see a GP for weeks. It is not good enough. Labor built Medicare. Defending it is in our DNA. The Liberals opposed it from the outset and cutting it is in theirs.

Schedule 2 of this bill expands the objectives of the National Housing Finance and Investment Corporation Act 2018 to allow it to assist eligible single parents with dependents. The stated purpose of this measure is to allow the government to implement its policies in relation to support for single parents entering the housing market. Labor supports improving homeownership across all demographics, particularly single parents who have significantly lower rates of homeownership than the broader population.

We have always worked to make housing more affordable for ordinary Australians. After eight long years of this tired government, housing affordability has got worse and worse. There are more homeless Australians than ever before, and it is hard to see how the government policy we are considering this evening will do anything to address this. As my colleague in the other place, shadow minister for housing, Jason Clare, said, this policy does not go far enough. There are about one million single-parent families around Australia; this policy will help about 10,000. In other words, one in 100. I'd like to point out that the fastest growing group of homeless Australians at the moment are older women aged 54 to 65. This policy does nothing to help the growing number of older women who are experiencing poverty and homelessness in retirement. It pales in comparison with Labor's $10 billion Housing Australia Future Fund to build social and affordable housing now and into the future. This policy will create jobs, build homes and change lives.

Schedule 3 of this bill will exempt eligible payments made by the Australian government to thalidomide survivors from income tax and from the social security and veterans entitlement income test. The use of thalidomide in the 1950s and sixties was a tragedy. That tragedy continues to have devastating effects for the survivors of thalidomide and their families. They continue to experience ongoing health concerns and suffer from the after effects of thalidomide.

Schedule 4 of this bill provides an income tax exemption for qualifying grants made to primary producers and small businesses affected by the February and March 2021 storms and floods. This is a small measure of assistance for those businesses. Labor welcomes it, but we note the government's ongoing shambolic response to natural disasters. We saw what happened in the 2021 bushfires. We know that money was left sitting in funds for months and months while survivors suffered and struggled. There were lots of photo ops, but very little delivery—another case of too little, too late.

Finally, schedule 5 of this bill includes several new additions to the list of deductable gift recipients in the Income Tax Assessment Act 1997. This is welcome.

Overall, the measures in this bill are sensible, of modest impact and measured. Labor will support them.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Schedule 2 of the Treasury Laws Amendment (2021 Measures No. 3) Bill 2021 amends the National Housing Finance and Investment Corporation Act to include an additional objective of assisting earlier access to the housing market by eligible single parents with dependants. Of course, it is very difficult to oppose that objective, and the Greens don't oppose it; we support schedule 2 of the bill. But I will place firmly on the record what we don't support—that is, the way the government intends to give effect to schedule 2.

As outlined in the budget, the government plans to establish the so-called Family Home Guarantee by allowing up to 10,000 single parents to buy a home with as little as a two per cent deposit. This budget measure tells you everything you need to know about this government's approach to housing—it is cooked. As I said earlier today, Australia's housing market is cooked. Rather than a home being regarded as a human right that everyone should have secure access to, housing in Australia has been turned into a game of speculation. How this has come about is very clear. Negative gearing and the capital gains tax concession are public subsidies for property investors that create an uneven playing field that means that there are a lot more people who want to buy a house than there are people who actually need a house to live in. Those who don't want to live in the house that they're buying have more money than those who do want to live in the house that they want to buy, thanks to this public subsidy. It's cooking the housing market, and the people who are paying the price are the renters and the homeless of this country.

I want to turn my attention to the banks. Banks are encouraged to lend for housing because the capital they need to hold against mortgages is much less than what they need to hold against loans to businesses, which means, of course, that Australia's banks are addicted to mortgages.

Now I want to turn my attention to monetary policy. This country's monetary policy is oblivious to where the credit goes, as has been evidenced over the past 12 months, where the Reserve Bank has printed $200 billion. Basically, the cheapest money in history has done an awful lot to push up house prices and very little to improve the productive capacity of the nation. Over the ditch, in New Zealand, they've realised that their Reserve Bank can't continue to pretend that housing isn't something that monetary policy should take into account. But here in the Commonwealth of Australian real estate, we are yet to become so enlightened. As a result, winning or losing in the great Australian game of property speculation is likely to have a greater effect on your life than anything else so far as your finances are concerned. Being white- or blue-collar, your level of education and the hours you work now matter far less than how much property you own or how much you stand to inherit. Class in this country is being redefined before our very eyes, and it's being redefined in a way that looks an awful lot like feudalism, which is just the way the Liberals like it. But they have to pretend that a wage slave has a chance, so they serve up this bill and the Family Home Guarantee. Let's be clear, the Family Home Guarantee is a con. It will not help single parents who live on a wage to find a secure and affordable home, because it doesn't actually guarantee anyone a home. What it does is guarantee a loan for the banks. Both the Family Home Guarantee and the First Home Loan Deposit Scheme are government guarantees for low-deposit loans. Under both of those schemes the government insures the first 20 per cent of the loan—this is the critical bit—for the banks. That encourages banks, as a result, to lend to people who they otherwise wouldn't have lent to because the loans are too risky. The banks are encouraged to make those loans under these schemes because, if the borrower defaults, the public purse covers any loss. This, would you believe it, is the government's response to a cooked housing market and a housing crisis in this country. Basically, they want to encourage single parents to borrow more than they can afford in the most overheated housing market in history by providing that the government insures the banks against any losses. That is what the government wants to do, so we get more household debt, higher house prices and yet more public subsidies for the banks, all sold under the fallacy that people's not being able to save for a deposit is the reason they can't afford a home.

Mr Frydenberg: if houses weren't so outrageously expensive and the system wasn't so rigged in favour of the speculators and against people who actually want a home to live in, then people wouldn't need as much money to make their deposit in the first place. This government won't address the structural issues that make Australian housing amongst the most overpriced anywhere on the planet, because this government, led by a property council Prime Minister, is all for property speculation and all for helping out its mates who benefit from it—be they the property developers, the banks or their rank and file who lord over property investment portfolios and who live off the tax concessions that everybody else pays for. Instead, this government's whole response to the housing crisis is to encourage people to spend even more money on housing. What a time to be alive!

We've got an amendment on sheet 1302, circulated in my name, that would reduce this madness just a little. This amendment would make it less likely that the Family Home Guarantee would become a government-sanctioned debt trap for single parents. This amendment would establish in legislation, rather than leaving it to regulation, a minimum deposit requirement for the purchaser for all loans guaranteed by the National Housing Finance and Investment Corporation. This amendment would set the minimum deposit requirement at five per cent, which is the current level set under the First Home Loan Deposit Scheme. Loans issued with less than a five per cent deposit are also tracked by APRA as an indicator of high-risk lending. By the prudential regulator's own measure, the Family Home Guarantee as proposed by the government, requiring a mere two per cent deposit for single parents, will encourage and increase higher risk spending. That illustrates that this is a reckless and irresponsible policy. It also indicates that the Family Home Guarantee has nothing to do with helping single mums find secure and affordable housing but is simply about giving the government something to say when asked the questions, which will keep on coming, about what they are doing about the housing crisis that so many Australians are facing.

The government should not be enticing people to take out a loan with less than a five per cent deposit. It certainly shouldn't be enticing single parents into a loan with less than a five per cent deposit. Does the government remember the subprime mortgage crisis? The Australian Greens certainly do.

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

As a servant to the people of Queensland and Australia, I will be speaking to the Treasury Laws Amendment (2021 Measures No. 3) Bill 2021. One Nation will be supporting this bill. The first schedule indexes the starting point for the Medicare levy. Medicare must be supported. Without Medicare, everyday Australians would be held hostage to the greed of the medical establishment, which we see happening in the United States and elsewhere—and right here, given the vaccine rollout—in conditions that suit big pharma. Getting sick should not be a financial death sentence. Healing sick workers so that they can return to work as quickly as possible is the best outcome possible for the worker, for the worker's family, for the employer and for the whole economy. Medicare supports Australia's productive capacity. Indexing the Medicare threshold maintains the fairness of the system while maintaining the broadly based nature of the levy.

The family home guarantee, on the other hand, is not a great idea. The response to structural unaffordability in the housing market is not to give people handouts to afford houses. The answer is to deal with the structural unaffordability. The Prime Minister failed to take this opportunity, instead electing to go with a flashy promise that presented the opportunity for yet another announcement and another glossy brochure. We want substance. There is no domestic pressure on home prices. Median wages are going backwards. Fewer and fewer people are able to afford their own home. Immigration numbers are down to historic lows. So, where is this demand coming from? Where's the demand pressure that's fuelling double-digit growth in real estate prices?

A total of $87.8 billion flowed into the Australian real estate market from foreign buyers in the last year that we have figures for, 2018-19—later data would be nice, by the way. This did not include money being transferred from destinations like China for Australian residents to use to purchase residential properties. Anecdotally, this is a large part of the demand for residential property in the capital cities. The result is price inflation, resulting in worsening affordability for everyday Australians. The Morrison government, it seems, has decided to put housing affordability into the too-hard basket, waiting on the Prime Minister's desk for the next occupant. That's terrible governance.

This bill makes emergency flood payments tax deductible—fair enough; compensating victims of flood damage to restore our productive capacity is of course the right thing to do. Yet building dams for flood mitigation works even more effectively, and far better. Remember when we used to do that? Dams are wonderful things. They provide water for communities, water to grow food and fibre to feed and clothe the world, hydroelectricity—and yes, they mitigate floods. As our high immigration rate leads to expanding development, dam based flood mitigation must become a priority.

I want to raise something here. The Greens are either confused or hypocritical, because they oppose dams, yet dams will lead to increased irrigation, which will lead to increased green plants, and that means increased absorption of carbon dioxide. Now, we know there's no need to absorb more carbon dioxide, because nature controls that level of carbon dioxide in the atmosphere, and our planet's climate is varying naturally. But the Greens are being either hypocritical or dishonest by saying they don't want dams but want more carbon dioxide absorbed.

This bill allows for tax deductibility for compensation payment for thalidomide victims. That's entirely appropriate. Thalidomide is a terrible chapter in the history of pharmaceuticals. The question must be asked, have we learned anything from the thalidomide disaster—the thalidomide scandal? Over the past 20 years, 104 medications and medical devices have been withdrawn from sale by the TGA following initial approval and widespread use. Not one of these withdrawals was initiated by Australia's own testing program—not one. In Australia the TGA tests around 400 product batches a year, out of 28 million prescriptions. This very low rate has not detected a single product requiring withdrawal. Every one of those 104 withdrawals has been due to overseas agencies testing and detecting critical harm.

This is not good enough. Now we have an obscene rush to introduce vaccines that are based on new and untested technologies, mRNA vaccines. They've been given provisional approval, and already people have lost confidence in the vaccines and are afraid of the vaccines. They're fearful of the vaccines. One Nation has no confidence in this process, so I expect that a future Senate will be asked to approve tax deductibility for compensation for victims of COVID vaccines. At the rate that harm is being detected here and especially overseas, that may well be in this Senate's lifetime.

I want to finish with some words about productive capacity. I've harped on about two things in the Senate. The first thing is empirical scientific evidence, the need to base policy and decisions on solid, scientific data and hard facts and observations. The second thing I've been focusing on is productive capacity. I'm so delighted to hear Senator McKim from the Greens mention productive capacity today. We know that others in the Liberal-National government have been mentioning productive capacity. We've even had the Prime Minister taking it up. But we want to see substance, not rhetoric. Don't just steal my words and take my intent; we need action to restore Australia's productive capacity. The Liberal, National and Labor parties are following the Greens policies, decimating our country's productive capacity. Yet our productive capacity is the key to our country's future. One Nation wants to restore it. We will continue working on this, because we want to bring Australia back to the point where we are No. 1 again, as we used to be, worldwide for per capita income. The key to that is what caused it in the first place: productive capacity.

Jane Hume (Victoria, Liberal Party, Minister for Superannuation, Financial Services and the Digital Economy) Share this | Link to this | Hansard source

Firstly, I would like to thank those senators who have contributed to this debate. Schedule 1 of the Treasury Laws Amendment (2021 Measures No. 3) Bill 2021 amends the Medicare Levy Act 1986 and A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Act 1999 to increase the Medicare levy low-income threshold for singles, families, and seniors and pensioners, consistent with the increases in the consumer price index. This will ensure that low-income thresholds keep pace with increases in the costs of living. The amendments to the Medicare levy low-income thresholds apply to the 2020-21 year of income and future income years.

Schedule 2 of the bill will enable the National Housing Finance and Investment Corporation to provide 10,000 family home guarantees over four years, commencing on 1 July 2021, to single parents with dependants, predominantly women, seeking to enter or re-enter the housing market sooner. The Family Home Guarantee recognises the importance of housing and providing a foundation for social, economic and emotional wellbeing. By establishing the Family Home Guarantee, the government is providing a pathway to homeownership for single parents with dependants who have struggled to save enough for a deposit while paying rent and/or restarting their lives, allowing them to purchase a modest home sooner, subject to the individual's ability to service a loan.

Schedule 3 of the bill will exempt eligible payments made by the Australian government to thalidomide survivors from income taxation and from the social security and veterans' entitlement income test. As announced in the 2020-21 budget, the Australian government will provide $44.9 million over four years and $3.9 million per year ongoing to thalidomide survivors.

Schedule 4 of the bill provides an income tax exemption for qualifying grants made to primary producers and small businesses affected by the February and March 2021 storms and floods, which had a devastating impact on communities in Australia. The schedule provides qualifying grants—category D grants—under the joint Commonwealth-state Disaster Recovery Funding Arrangements of 2018, where those grants relate to the storms and floods in Australia that occurred due to rainfall events between 19 February 2021 and 31 March 2021. These include small business recovery grants of up to $50,000 and primary producer recovery grants of up to $75,000. These grants provide support in addition to other assistance that the Australian and state government have provided to assist communities as they begin to build and recover following these devastating events. Impacted small business and primary producers are encouraged to apply for these grants. Further information on disaster recovery assistance is available on the Disaster Assist website.

Schedule 5 of the bill amends the Income Tax Assessment Act 1997 to allow members of the public who donate to the Alliance for Journalists' Freedom Ltd, the Andy Thomas Space Foundation Ltd, Youthsafe, the RAS Foundation Ltd, the Judith Neilsen Institute for Journalism and Ideas, the Great Synagogue Foundation trust, the Centre for Entrepreneurial Research and Innovation, and the Sydney Chevra Kadisha to claim a tax deduction. The government is supporting these organisations in their provision of valuable community services by granting them deductible gift recipient status.

I commend this bill to the Senate.

Question agreed to.

Bill read a second time.