Thursday, 25 October 2018
Social Services Legislation Amendment (Housing Affordability) Bill 2017; Second Reading
I'm speaking in support of the amendment that's been moved by the member for Barton and shadow minister for social services. The Social Services Legislation Amendment (Housing Affordability) Bill 2017 extends the voluntary Rent Deduction Scheme to be mandatorily applied to all tenants receiving social security or family assistance payments who live in public or community housing. That's the first element of the bill. The second element of the bill refers to the National Rental Affordability Scheme and providing a bit more clarification about the term 'below market rent' and also some flexibility in respect of vacancy periods—broadly, principles that Labor supports.
This is a bill that, however, doesn't really address some of the key issues of housing affordability and homelessness in Australia. Once again, given the opportunity, this government have missed the mark when it comes to providing a real response to some of these key issues that are seeing, unfortunately, a large number of Australians sleeping rough throughout the country. The Abbott-Turnbull-Morrison government has had over five years to develop some meaningful reform in this area, but they've really given up on governing and they've slashed the original cap of 50,000 dwellings in the National Rental Affordability Scheme to 38,000. Despite serious housing stress and a lack of affordable housing options in Australia, they've failed to restore Labor's original cap and failed to deliver an extension of the NRAS. They've done nothing to meaningfully address issues of housing affordability, they've done nothing on homelessness, they've taken very little action to improve mental health services and mental health outcomes, they've given no assistance for additional housing for women leaving situations of domestic violence and they've given no help to vulnerable Australians to access more affordable housing options. Any member in this place will tell you about the massive waiting lists that exist for public and community housing in this country at the moment. In the area that I represent, people can wait up to eight years to get and access public or community housing. That's simply too long. For a wealthy, developed nation like Australia to treat people in that circumstance when they're at their most vulnerable is unacceptable.
Changes to the treatment of tax concessions for property investors and genuine investment in social housing are needed to address the cost of housing for everyday Australians. But, like many things with this government, it's all been too hard, particularly given how focused they've been on their internal shortcomings over recent years. We've seen this before from this government. Vested interests get in place and lobby the government to ensure that they don't take real action to deal with some of the issues around housing affordability. Most notably, the very generous and in some cases the largest tax concessions in the world that exist for investors in property in this country have had an effect on the housing market and have distorted affordability outcomes, particularly in the big capital cities. I'm referring, of course, to the government's continued support for the massive tax concessions that exist around negative gearing and capital gains tax discounts on the sale of investment properties in this country. It appears that the Prime Minister and the Treasurer are more interested in ensuring that there is a tax concession for someone that is seeking to negatively gear their ninth or 10th investment property rather than in providing support for first home buyers or people who are looking to get into public housing or, indeed, providing more public housing to ensure that those waiting lists reduce.
We've seen only this week that again the government are on with their scare campaign about negative gearing, relying on a report prepared by the Master Builders that is completely wrong. It appears they didn't even read Labor's policy around negative gearing, because the policy grandfathers anyone that's currently in the system and ensures that the reforms to negative gearing only apply prospectively to those who are seeking to negative gear beyond a certain date and allows negative gearing to continue just so long as it is in respect of off-the-plan developments and new housing. The philosophy there is that it will grow the housing stock, that it will generate jobs in the important housing industry and increase the stock, thereby taking pressure off house prices and pressure off rents. Many of the people who are the subject of this bill today are in the situation they're in because they can't afford to buy a house and they certainly can't afford to rent a house given the exorbitant house prices.
At the same time, when it comes to rental affordability, those opposite have hobbled the National Rental Affordability Scheme with a cap of 38,000 dwellings. That's a reduction on the cap that Labor had put in place when we were in government, trying to improve affordability for people in rental markets throughout the country. This decision has been widely criticised by housing sector stakeholders, including the Property Council of Australia. It was the Property Council that backed reforms to negative gearing and capital gains tax discounts as well. These much-needed changes to CGT and negative gearing are key measures to help holistically address the growing social and economic inequalities that contribute to housing affordability issues.
The Abbott-Turnbull-Morrison government is at odds with an ever-increasing list of organisations and individuals arguing for reform of negative gearing and capital gains tax concessions in this country. They include the International Monetary Fund, the OECD, the government's own financial systems inquiry, the Grattan Institute, ACOSS, the Committee for Economic Development of Australia, and the Australian Institute of Company Directors. All of these organisations have been calling for some years for reform to negative gearing and capital gains tax discounts because of the distortions in the housing market that they produce and the effects that they have on housing affordability that lead to situations like the one that we're debating here, with people being unable to afford a house in the normal rental market and pressure being put on the public housing system, leading to some of the consequences that are dealt with in this bill.
Winding back tax concessions like CGT and tax discounts is a more equitable and efficient way of raising revenue, but it also deals with some of the distortions that I mentioned earlier. Labor's housing affordability policies have been specifically designed to provide that affordability element—to take pressure off rental markets but also to stimulate new housing supply by continuing to allow negative gearing arrangements for investments in new housing stock whilst protecting existing investments. Only Labor is committed to tracking and tackling housing affordability issues that grip the nation. In many respects, it is the No. 1 issue for household budgets throughout the country.
Labor's always said that the vast majority of income support recipients are more than capable of managing their own finances. This bill does go to those types of issues: how far you should seek to intervene in people's own affairs and the managing of their finances, particularly those who are public housing tenants and their ability to pay their rent on time. In the case of rent, we know that most social housing residents are excellent tenants and prioritise their rental payments. It's a fact that the rate for public housing and social housing in the last five years, to 2015-16, was over 99 per cent. In those five years leading up to 2015-16, for 99 per cent of the time public housing and social housing tenants paid their rent. That's why the government's proposed scheme in this bill is a disproportionate response. There's not really a big issue for many public housing tenants when it comes to paying rent on time and paying rent in full. Although the number of evictions of social housing tenants is only a small proportion, abandonment of the premises also occurs and homelessness is a result of both. What the studies find is that, in a lot of cases, when it comes to homelessness with respect to public housing, mental health issues, drug addiction and other health issues are bigger factors than paying rent on time. However, the automatic rent deduction scheme, in its current form, risks tenants being forced into serious financial hardship. This is an issue that's been identified by the Senate committee that looked into the bill. In their inquiry into this element of the bill, they found that there wasn't really an issue. Although we all want to ensure that people aren't forced into situations of homelessness, this bill could go too far by intervening into the affairs of those who are receiving social security payments in the country.
There's a principle in social security, and that is the inalienable nature of the payment to the recipient of the payment. In other words, the payment that's provided to someone who's on a pension, including a disability support pension, or is receiving other Centrelink benefits or is on Newstart, should go directly to them and shouldn't go to third parties. That principle has been whittled down over some years by things like the intervention in the Northern Territory, cashless welfare cards and the like. Labor's philosophy is that this should occur only in extreme circumstances and, given those particular factors about the rates of nonpayment and the rates of late payment of rent in public housing, we don't really see the need for drastic measures such as this.
In respect of the bill, generally, there are some good elements related to clarifying definitions regarding the National Rental Affordability Scheme. However, I reiterate the point that I made earlier—that some elements of this bill go too far. Once again, the government isn't really dealing with the issue at the heart of some of these measures—and that is the fact that rental and housing affordability in Australia is at incredibly unaffordable levels. It's been identified that the massive tax concessions that exist around housing for investors in this country are driving a lot of that unaffordability. Unless you are dealing with those tax concessions—negative gearing and capital gains tax discounts—you are not fair dinkum about housing affordability in this country. Only the Labor Party have that set of fair dinkum policies to really improve affordability and ensure that ultimately we reduce the amount of homelessness in this country and ensure that everyone in Australia has the opportunity of that great principle, that human right, of a roof over their head.