Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 1) Bill 2017
October 23, 2017
I rise today to speak on the Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 1) Bill 2017 and the First Home Super Saver Tax Bill.
The aim of this bill is very simple—to give Aussie families a better shot at realising the great Australian dream.
The dream of owning your own home is being cast as being incredibly unobtainable, but this should not be the case and it does not have to be.
This bill aims to assist those seeking to buy their first home by enabling individuals to put money into their superannuation account with the specific intention of using that money as a deposit to purchase a home.
This contribution will be capped at $15,000 per year and $30,000 in total.
These contributions can be withdrawn for a deposit at the marginal rate, less a 30 per cent offset.
This measure is estimated to reduce revenue by some $250 million over the forward estimates period.
What this means is that $250 million will be left in the pocket of those Australians saving for and buying their first home.
That's a quarter of a billion dollars extra over the forward estimates period that this government will set aside to free up support for first-home buyers, and this is a significant contribution from this government.
This government is delivering for those younger Australians not only with this bill but also in many other ways, and let's just look at our recent record.
The PaTH program is offering avenues to employment across a range of industries and allowing young people, in particular, to engage with the industry to get the skills needed to advance their careers.
Revitalisation in education with the New Colombo Plan is strengthening that sector and broadening the horizons of our students.
We are increasing the number of medicines and vaccines available or supplied to young people, ensuring their health as they age, and our innovation and science agenda, along with the NBN actually being delivered, is transforming and empowering our economy.
Unlike those opposite, rudimentary economics is not lost on us on this side.
We know that the best way to lower the price of a commodity, be it electricity or raw materials or housing, is to increase the supply of that commodity.
Therefore, to complement the First Home Super Saver Scheme initiative, people aged 65 and over will be permitted to make an exempt non-concessional super contribution of up to $300,000, or $600,000 for a couple, after selling their main residence that has been held for at least 10 years.
This reduces the barrier for older Australians to downsize from the home they no longer need, helping to free up existing stock of larger houses for those younger, growing Australian families.
This bill will help those younger Australians buy their first home by helping them save for and better access a deposit, which we all know is increasingly difficult to come by.
It will also increase the supply of housing by helping older Australians downsize, if they choose to do so, into more appropriate dwellings without those front and back lawns we all despise on weekends.
We are upping the number of available rental properties with a foreign-resident vacancy tax.
This will incentivise foreign investors to make their property available to the Australian rental market.
Further, foreign ownership in new developments will be limited through the introduction of a 50 per cent cap of the number of properties that can be sold to foreign investors through development pre-approvals.
We are also providing $117.2 million to support frontline services to address homelessness.
The fact is, if you are homeless you simply cannot get a job let alone get a housing loan, so this is critically important for this particular sector.
As you can see, this government is putting in place measures by which outcomes across the entire housing spectrum will be improved.
It would be remiss of me, at this point, to not at least touch on the subject of negative gearing.
Negative gearing as a mechanism does contribute to keeping rents lower than they would otherwise be, and Labor plans to tamper with this mechanism, as we heard from the previous speaker.
Labor's plan to abolish negative gearing will push up rent and impact investments for millions of Australians, including for those in my electorate of Durack.
Within Durack, 15 per cent of constituents reported a net rent loss on their financial-year returns for the years 2014-15—that is, 15 per cent of taxpayers in Durack own a negatively geared property, which is markedly above the Australia-wide level of 10 per cent.
Within Durack, almost half—some 49.7 per cent—of occupied private dwellings were rented in 2016.
That is far higher than the Australian-wide level of some 31 per cent.
This number skyrockets when you head to the more remote parts of Durack, as you would expect. Within the Pilbara region of Western Australia, for example, which is wholly contained within my electorate, as you well know, Mr Deputy Speaker Vasta, over 80 per cent of occupied private dwellings are rented.
So Labor's reckless negative gearing policy, as you would understand, Deputy Speaker, will disproportionately harm my constituents in Durack.
The only changes that the coalition are making to negative gearing—and these are contained within the housing tax integrity bill of 2017—will be to disallow travel expenses associated with investment properties—reining in an incredibly high growth deduction—and also a redefinition of which plant and equipment can be depreciated.
This, in stark contrast to Labor's policy, will expand confidence in the negative gearing system and will have no impact on rent prices and investment levels, and it is welcomed.
We are aware that the amendments contained within the bill represent a marked change in superannuation policy in this country—and we know how fond those opposite are of the current superannuation arrangements for a number of reasons.
Firstly, there are the millions of dollars from their union mates that they are able to take from it—and we know what a rort that is.
Secondly, and most importantly, they like superannuation because it's someone else's money.
Nothing excites those opposite more than the prospect of deciding how to spend large sums of other people's money or, for that matter, telling people how to spend large sums of their money.
So, when looking at these proposed amendments, it's worth reflecting on the purpose of superannuation.
As we know, it's designed to provide a means by which people can support themselves in their retirement.
If an individual feels that a house of their choosing may be a better investment than a government-mandated super account, which they often have limited control over, as we know, why should we stand in the way of that?
The amendment that we are discussing today in the bill will give Australians the option to boost the savings they can put towards a deposit by 30 per cent compared to saving through a standard deposit account, which we know is becoming increasingly hard to achieve.
This is not something which should be opposed.
Those opposite should realise that, by doing so, they are making it harder, not easier, for people to buy their first home.
Some have referred to the current high house price situation as an affordability crisis.
I doubt those who own homes and are looking to sell their homes would consider that to be a crisis—but I guess that's a debate for another day.
While this bill will allow those who are trying to break into the housing market another more effective avenue to save for the deposit, whilst also increasing the supply of the housing, there are other ways that people seeking to break into the housing market can find affordable housing.
What I refer to here is housing stock in regional Australia.
In my electorate of Durack, in the thriving and beautiful regional hub of Geraldton, a three-bedroom, one-bathroom house can be found for under $200,000.
In the Wheatbelt town of Merredin, a three-by-one or a four-by-one house sells for under $200,000.
In Carnarvon, which is a beautiful town on the Coral Coast of Western Australia, a three-by-one can be sold for under $200,000 and a four-by-two for under $500,000.
I appreciate that in the Deputy Speaker's own electorate the same would be the case, as indeed it would in many other parts of regional Australia.
I would just like to put on record that all parts of regional Australia would welcome first homebuyers should the need arise.
So, Deputy Speaker, you could argue that there is no housing affordability crisis if you bothered to look outside the capital cities.
We know on this side of the chamber that there is more to Australia than just Sydney and Melbourne.
Certainly, in the electorate of Durack, there are many opportunities for housing affordability.
In summary, this proposed amendment will increase the supply of housing.
It will put more money into the pockets of first homebuyers, it will enable first homebuyers to save for their first home and, at the same time, it will support empty-nesters.
It should be supported on its merits.
I call on those opposite to support this bill, and I commend the bill to the House.