Andrew Bragg (NSW, Liberal Party, Shadow Assistant Minister for Home Ownership) Share this | Link to this | Hansard source

In respect of the interim report of the inquiry conducted by the Senate Economics References Committee into retirement outcomes, dealing particularly with existing and proposed superannuation for housing policies, I move:

That the Senate take note of the report.

The reason we commissioned this particular report and are conducting this inquiry is that we are looking at all the options to try and solve the nation's housing crisis. We don't have a closed mind. We're not against any particular solution, because we are not in the business of closing our minds to certain ideas. I believe that the nation is much the poorer for a policy debate where political parties cannot—

Sorry, what was that? Were you referring to me?

Marielle Smith (SA, Australian Labor Party) Share this | Link to this | Hansard source

Senator Bragg, you are required to address your comments through the chair.

Andrew Bragg (NSW, Liberal Party, Shadow Assistant Minister for Home Ownership) Share this | Link to this | Hansard source

Sorry. I thought I heard something. The point I was trying to make is that it is very regrettable when a political party is not able to consider a reasonable solution because it is beholden to vested interests.

I don't think the parliament needs a lecture from anyone as to the importance of housing for younger people. If you look at any survey of people under the age of 40, they'll nominate housing as a major issue. That does not discriminate between whether you are a renter, you are a mortgage holder or you are a prospective buyer. It doesn't matter what your status is; it is a huge issue. That is why we thought it was important to look at the superannuation issues here.

The government has had almost two years in office. It identified housing as a problem when it came in. It has cooked up a housing target of 1.2 million houses, which no-one believes that they will meet. The Premier of New South Wales, Mr Minns, has laughed at these targets. He says that New South Wales will never comply with these targets. Furthermore, the solution that Labor rolled out at their campaign launch in the last federal election was known to us all as the federal Help to Buy scheme. This is a scheme that would provide 10,000 houses. If you're admitting that you need to provide 1.2 million houses, 10,000 houses is barely going to touch the sides.

Of course, the problem with Help to Buy is that it is part of a broader theme that Labor has deployed on housing, and that is that it has given up on individual homeownership. Labor has adopted, in this term, a policy of corporate homeownership. Their solution to the housing crisis is to call in their mates—the super funds and the foreign fund managers—and say to them, 'We'll give you a tax subsidy to build the houses of tomorrow.' The catch here is that not only will these major institutions own the houses; in most cases these houses will be build-to-rent houses.

So it is locking in a model of housing which many Australians do not want. Many Australians are comfortable renting, but most Australians do not want to rent. This corporate housing policy, where the big super funds and the foreign fund managers are given tax subsidies and taxpayer handouts to construct build-to-rent houses, is the first element where Labor gives up on homeownership.

The second element is this Help to Buy scheme. Drawing on a flawed state-based shared equity scheme which very few people want to use, the government has put forward, finally, legislation to create a Commonwealth help-to-buy scheme, and I thank the Greens for their wisdom in joining with us to oppose this bad legislation, which would only lead to a very small number of houses when we are facing a massive crisis.

Everyone knows that the major issue here is going to be supply: How do we build more houses? How do we make sure that the children of Australia can look to a future where they can live in a house that they themselves can own? To build those houses, you need to find a way to work constructively and perhaps collaboratively with, or maybe you need to use coercive measures on, local governments and the states. Mr Albanese's attempt to pay the states to build houses has been a failure. It has been one of the greatest failures of this government, because, even though he's offering to pay premiers to build houses, when you have wall-to-wall Labor governments, they still won't build the houses. In fact, we have seen construction figures go backwards under this government. We're building fewer houses than we were just three or four years ago. This is all happening at a time when we're opening the floodgates to more migrants on a per capita basis than we've seen since the 1950s. So we have here a fundamentally broken housing policy from the government.

We accept that we have to build more houses and that we have to focus on that supply piece, and that is something that we will continue to look at. But there is also a very strong case to tilt the scales in favour of first home buyers, and this is where I think my great disappointment comes in. What is the reason why the government, or any party for that matter, will not look at allowing people to use their own money to get into the first home market and get their first home? I can't think of any reason, other than that a party or an organisation is beholden to commercial or vested interests. This is why the inquiry we conducted into using super and looking at ways to enhance proposed and existing policies that are on the books is so important.

The committee process was, quite simply, one which looked at the deposit side. We looked at how we could help Australians use their own money to get a deposit together. For an older millennial who is close to 40, you're looking at an average super balance of around $80,000 to $90,000. Now, in most cities in Australia that would get you a large part of the way towards a deposit. That is why we already have a policy which allows Australians to take $50,000 of their own superannuation to help get a deposit together. We recognise that the key determinant of your financial success in retirement is not your superannuation balance; it is your homeownership status. So we were very comfortable with the starting point that we announced a couple of years ago, which was that $50,000 of your super could be used for a first home. But what we found during the inquiry is that that would not be sufficient for a number of Australians, particularly those older millennials who do have high balances, so we have recommended in this report that the threshold be lifted from $50,000 to $100,000 or $150,000 and have no maximum withdrawal cap. So we've given some options there.

The second recommendation we made which is material concerns the current policy, which works like this: you have to put the money back into super if you sell the first home. But, for a lot of people, their first home is getting them onto the ladder. It might be a small flat, so, if they want to buy a bigger house for their family and they sell their first house, they should be able to transfer that money into that second house. The idea of putting it back into the locked box of the super funds might well suit the vested interests of the financial sector and the trade unions, but it's not going to be in the best interests of those families that want to house their children or themselves.

Those are the two principal recommendations. We also looked at recommending models for people who have great anxiety about any money leaving the preservation of superannuation. There may be ways in which, perhaps, APRA could provide some guidance to schemes that want to use money as debt or collateral that is to remain inside the scheme. We've proven that you can deliver a parliamentary report which gives you a range of options, and I think that's what the Australian people are looking for. They're looking for all of the options to be deployed. I think that, despite sensitivities in certain parts of our biggest cities, people understand that we do need to see more density and we do need to see more supply. But equally we want to see the playing field tilted in favour of first home buyers. That's why it's critical that we look at the cost of construction, the cost of lending and, of course, allowing people to use their own money. If people have their own money and they want to use it for a first home, there is no reason they should not be able to do that, because, as I say, the key determinant of your success in retirement is not your superannuation balance; it is your homeownership status.

I seek leave to continue my remarks later.

Leave granted; debate adjourned.