Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

The Labor Party will oppose this legislation, the Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 1) Bill 2017. In typical fashion for this government, the government claims, in naming the bill in their Orwellian fashion, that this is a measure to reduce pressure on housing affordability. But this is actually a poor excuse for a government that is incapable of coming up with a housing affordability policy, a poor excuse that actually will make housing affordability worse and undermine the retirement incomes of Australians. That's the best this government can come up with.

We were promised a comprehensive plan—a holistic, substantial package. We were promised that it was going to be huge. We were told that the budget was going to be breathtaking in its scope when it came to housing affordability. What we got was a grab bag of a collection of half-baked ideas—thought bubbles—many of which will actually make the situation worse. And this is all to cover up the fact that the government refuses to use the one big lever at its disposal. This government is singularly incapable of reforming negative gearing—the most important thing that can be done at the federal level to help first home buyers. We have the most generous property tax concessions in the world. We give more taxpayer support to somebody to buy their fifth, sixth or seventh home than we do to somebody to buy their first, and this government says that's okay. We have investor rates at record highs and first home owner rates at record lows, and this government says that's okay. We have the situation in which 50 per cent of negative gearing goes to the top 10 per cent of income earners and 70 per cent of the benefit of capital gains tax concession goes to the top 10 per cent of income earners, and this government says: 'That's just fine. We're just going to keep it, just going to leave it in place. We don't care that it's unfair. We don't care that it worsens housing affordability. We don't care that it's bad for the budget. We're just going to leave it in place.'

Instead, we get these ridiculous measures, particularly the first schedule of this bill, which undermines the retirement incomes of Australians and makes housing affordability worse. This is part of a long line of attempts and attacks by the Liberals and Nationals, over generations, to undermine Australia's universal superannuation system, which the Labor Party introduced in the 1990s over the vociferous opposition of the Liberals and Nationals—vociferous opposition. We hear a lot about bipartisanship and how it should be more like the nineties. Well, just as they opposed Medicare, they opposed universal superannuation. They keep finding any opportunity to undermine superannuation. Any idea out there, they say, 'Yeah, let's use superannuation money for that.' At their core, they do not believe in universal superannuation. At their core, they do not support the universal superannuation system as it was introduced.

Superannuation accounts are meant to be a locked box to generate retirement income—not to be used at the whim of governments of the day but to be set aside for the very important task of providing every Australian with a dignified retirement. In time it will take pressure off the age pension, that is true, but it also provides every Australian with a dignified retirement. That's what superannuation is for. Yet this government will find any opportunity to undermine it. We saw it with the previous Treasurer—the then member for North Sydney—who came up with this thought bubble of allowing access to superannuation for housing. The response from the superannuation sector was, correctly, outrage that a treasurer did not understand the importance of superannuation for Australians' retirement income. And this Treasurer is no better. In fact, he's worse. This plan would mean that first home savers, who make voluntary contributions in the superannuation system, can withdraw those contributions, up to a certain limit, and an amount of associated earnings, for the purpose of purchasing their first home. The concessional tax treatment would apply to amounts that are withdrawn under the scheme.

It's ironic because this government is putting forward this measure that undermines the objective of superannuation, which they are attempting to legislate as we speak. The government has legislation before the parliament to say that the objective of superannuation should be to provide income in retirement to substitute or supplement the age pension, whereas this legislation undermines that objective. We don't entirely agree with that objective. The Murray inquiry recommended that the objective should be bipartisan. The government has not engaged in that good-faith negotiation with the opposition to get a bipartisan agreement. I've made crystal clear time and time again that we would be prepared to do that. This is the legislation before the parliament for that objective, and yet over here, in this legislation, the government is undermining their own objective for superannuation, because they would not provide, through this, a mechanism to allow income and retirement to substitute or supplement the age pension, because some of it will been gone—used up for a housing purchase.

I understand that some people will find this superficially attractive. I understand that some people would say, 'I can get the money now; I can use it for a house now.' I can understand this. But this comes to our second point. This will actually make housing affordability worse. It's pretty basic economics.

Mr Howarth interjecting—

The member chortles. They don't understand basic economics over there. They don't understand that if two bidders, for example, at an auction—because this would be available to more than one person—come to that auction and said, 'We've got access to our superannuation, so we're going to bid higher', they're going to bid against each other, and they're going to bid the price up. The only winner in that scenario is the vendor, who can get more for their house. The actual person who purchases the house, having used some of the money that was set aside for their retirement income, is no better off. The person who missed out on the house is no better off. The person who is better off is the vendor, and that is making housing affordability worse. Whether it's an auction or whether it's just sold in the normal fashion through a real estate agent, the laws of economics are the same. Honourable members opposite just don't understand the basic law that if you actually stimulate the amount of money people have there it will drive up demand. This is more evidence of the 50 years of policy failure that Saul Eslake talked about—when governments, devoid of any other plan, just think, 'Oh well, we'll just stimulate more demand by this short-sighted mechanism'. But this one is actually worse! This one is actually the worst of the bunch, because at the same time it undermines superannuation.

We will oppose this strongly. We will oppose this vociferously because we are the party that supports superannuation. We're also the party with the comprehensive plan to deal with housing affordability, which the mob opposite just simply hasn't had the wit to come up with. They absolutely refuse to reform negative gearing—the one big thing that they could do. The one big reform they could embrace—to reform negative gearing and put first home buyers on a more level playing field, making our tax system fairer and having a positive return to the budget. They just won't do it—singly incapable! Instead we get this rubbish legislation put before the House. It's an insult to the intelligence of the House, an insult to the intelligence of young Australians trying to save for a first home and an insult to all those who think that they can dare to dream of having a dignified retirement and home ownership. This government says that you can choose—you can have a dignified retirement or you can have home ownership. You can't have both.

There are a number of other reasons why we will oppose it, but I can tell that you, Deputy Speaker Hastie, are very keen to get onto the adjournment debate, so I'll reserve my remarks for a later day.

Debate interrupted.