Tuesday, 8 November 2016
Economy, Human Rights
Thank you, Deputy Speaker Hastie. You look very comfortable in that chair, and may you continue to reign long in it, as you see fit.
Today, we grieve for future Australian taxpayers. Our nation's finances speak to an injustice at the expense of our children and grandchildren. Our gross debt this year is nearing $500 billion and net debt is projected to reach $326 billion, costing us $43.6 million in interest every day. That is more than we individually spend on pharmaceuticals, public schools or jobseeker income support.
It is a structural deficit that is driving our debt. Half of the budget is composed of recurring health and social security spending. It is lifestyle spending for lifestyle debt. This government has tried to address this problem. Labor and the Greens have blocked it, justifying doing so by false moralising. The cost, if we do not rein in spending, is human. If we do not cut spending, we will not be able to afford the innovative medicines and treatments of tomorrow. Innovative medicines are coming to chronically manage or cure Alzheimer's, cancers and HIV, to name but a few. We will not be able to afford them or the benefits they will be able to provide for people who are suffering, nor aged care that delivers dignity, nor education to broaden minds for prosperity. This is not a formula for building Australia's future. It is a formula for managing our society's demise.
The value of a society can be judged by how well it takes care of its most vulnerable. Could unborn Australians be any more vulnerable? If we keep on this path, we ignore them for ourselves. The well off do have to pay their fair share—this is not in dispute. We also need a just tax system so they do so. Fifteen years ago, almost 80 per cent of taxpayers paid 30c in the dollar or less. Today, it is only a quarter. More taxes incentivise avoidance. Real reform is needed, not fiddling at the margins.
This is not just a debate about dollars and cents. This is a moral debt. Intergenerational debt breaks the social contract between generations. If a bank handed every newly-born child a maxed-out $10,000 credit card, Labor would be calling for a royal commission. But that is what we are doing, and Labor's answer is to argue for a limit increase while we are trying to pay it off. Those alive today are living off the labour of the unborn. The unborn are not beneficiaries. They did not vote for it, but they will be left with this debt. If it is left unchecked, they will work all their lives paying taxes to repay the debt. Our generation is of mature mind. We accrued this debt; we should balance the budget and we should repay it.
Today we also grieve for the victims of Islamic extremism, specifically women, homosexuals and Christians, who have been systemically oppressed by Islamists across the world. The atrocities inflicted on minorities by Islamic fundamentalism are illiberal, primeval and indefensible. Daesh represents an interpretation of Islam that is profoundly incompatible with the modern world. Children are murdered for watching soccer. Homosexual men are thrown from the tops of high-rise buildings after show trials. Women are discouraged from seeking education, and from choosing their own clothing or their partner in marriage. Christians are being murdered simply for their faith and acting consistently with their God. Arguably, this amounts to a genocide. Islamic State has enslaved and brutalised women while empowering female morality police to oppress their own gender and ensure children are raised as what they would call true believers. They envisage a future without aesthetic Western contamination and without liberalism or democracy. There is no willingness for mutual respect. They are destroying the cultural heritages of other civilisations. This problem is shared with many of those Muslim countries struggling in a globalised world against this type of extremism.
Daesh did not learn these illiberal attitudes out of nowhere. Australia's first openly gay imam, Nur Warsame, has labelled Islamic law out of date and not applicable to our society today. Coming from Somalia, where gay people face imprisonment and extrajudicial killings, he denounces archaic leaders who somehow preach punishment for homosexuals. The same sort of spirit is true of attitudes to the dignity of people of other faiths. This intolerance of religious pluralism cannot be tolerated. A free society does not seek to homogenise belief or conscience but instead affirms a respect for individual freedom—and that means freedom for everybody, not just for the select few or those who seek to advance their own agenda. We should never be afraid to stand up and speak out against these sorts of horrific crimes by extremists; they represent the worst of a mad ideology. It is a reminder of why I am a cultural conservative and not a cultural relativist—because not all cultures are equal. Such value sets have no place in a modern Australia, and we should not tolerate such vile practices or acts by extremists in other parts of the world, because they are inspired by barbarism and advanced by barbarians.
Today we also grieve for the future homebuyers of Australia. The Liberals strongly believe in the importance of homeownership and people having an equal investment in our society and a pathway to achieve that investment. Sir Robert Menzies was one of the great stewards of Australia's emerging middle class throughout the second half of the 20th century and understood, very importantly, how homeownership is central to the dignity and security that Australians enjoy. During his time, homeownership increased from 53 per cent in 1949 to 73 per cent in 1966. Yet, since 2002, we have seen homeownership among 25- to 35-year-olds fall from 39 per cent to 29 per cent. That represents more than 160,000 young people that would otherwise have found keys to their own home. While Australia's high level of social mobility is enviable—and it is—current trends in housing affordability are creating a class divide between homeowners and renters. Younger generations risk being unjustly subdivided based on whether they were able to buy a house and benefit from real estate appreciation much like their parents.
Removing negative gearing might sound like a very attractive solution, but it will actually do very little to impact on house prices in real terms. There is no single driver of increasing housing prices; there are many of them. There are issues of supply. There are issues of regulation, particularly at a state level, where overregulation extends time and cost and makes it more difficult for people to be able to invest and build the housing stock that we need for all stages of life—not just for younger Australians but also for the sort of housing that people need in the latter stages of their life. There are also planning restrictions in regulations and a lack of available financial instruments to enable people, particularly as they are going into the housing market, to secure the advancement they need and finance their future investment in a constructive way. To put it simply: to achieve a two-year decrease in the time an average income earner would need to save to reach a 20 per cent deposit on a median house price in Brisbane, Labor's solution would need to deal a blow of 20 per cent to house prices, which is well above the estimated decrease of 9.5 per cent. That is why we cannot focus just on negative gearing; we have to look at something much more substantial.
Loan repayment difficulty is actually comparable to historical norms. Given the current low cash rate environment, affordability on this measure is actually higher than it was six years ago. Aspirational homebuyers rightly identify the deposit gap as the most decisive barrier to homeownership. Sadly, the gap turns homeownership into a fantasy for many young people, who then spend their savings elsewhere. These aspirational homebuyers could be given access to their superannuation in order to secure a housing loan. Once the deposit gap is bridged, repayments rarely differ significantly from rent for similar dwellings. The Productivity Commission noted in 2015 that the most frequent use of superannuation lump sums was to fund housing, so this hardly undermines the integrity of the system. Ultimately, we need to focus on ways to assist and re-energise young Australians to save for their home and to be investing in the building of Australia's future. Innovation is needed to create pathways, and, fortunately, that is the Liberal way.