Jan McLucas (Queensland, Australian Labor Party, Shadow Minister for Mental Health) Share this | Link to this | Hansard source

My question is to the minister representing the Prime Minister, Senator Brandis. I refer to the Secretary of the Treasury, Mr John Fraser, who says that Sydney is unequivocally in a housing bubble, and the Reserve Bank Governor, Mr Glen Stevens, who says that the Sydney property market is 'acutely concerning' and 'crazy'. Does the Prime Minister share the concerns of the Secretary of the Treasury and the Governor of the Reserve Bank?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

Well, Senator McLucas, it is an important issue, and the Australian government is committed to pursuing policies that will enable young Australians to get into the housing market, but not at the cost of reducing the price of homes, because, Senator McLucas, as you and I both know, the principal asset that most Australians will own in their life is their home. It is their home, and we view with very deep concern the Labor Party's suggestion that negative gearing arrangements will be interfered with, were there to be a Labor government. We know what would happen: asset prices would fall and rents would go through the roof. That is your prescription, Senator McLucas; that is the prescription of the Australian Labor Party; and we will not have a bar of it. We will not have a bar of it.

We believe that houses should be affordable. We also acknowledge, by the way, that this is also an issue for state governments and for municipal governments. We acknowledge that one of the ways in which this problem can be addressed is by releasing more land for development in our great cities. We acknowledge that, and we also acknowledge the importance of restoring the economic prosperity, which suffered so gravely during the period of the Labor government, so that more people can be in employment and more people can afford houses. Senator McLucas, that is what we intend to do. What you intend to do is to pursue a harebrained policy that would see the value of people's principal asset fall without achieving any enhancement of housing affordability and would see housing rents in particular go through the roof. We will never do that, Senator McLucas.

Jan McLucas (Queensland, Australian Labor Party, Shadow Minister for Mental Health) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. In light of the concerns of the Secretary of the Treasury and the Governor of the Reserve Bank, does the Prime Minister hope Sydney house prices keep escalating, denying more first homebuyers the opportunity to enter the housing market?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

Senator McLucas, we understand that Australian homeowners want to see the value of their asset protected. As I said in answer to your principal question, the family home is the principal asset that most Australians will acquire in their lifetimes. We accept there are challenges to do with housing affordability. Of course there are. But the solution is not to deflate the value of the principal asset that most Australians own. That is not the way to go about it.

There are various strategies to address this problem. One of them, as I said before, is the release of more land for development. Senator McLucas, we are not going to pursue the harebrained policy that your leader has been contemplating lately of interfering with negative gearing arrangements in any way that will reduce the cost of an asset while increasing the rental cost.

Jan McLucas (Queensland, Australian Labor Party, Shadow Minister for Mental Health) Share this | Link to this | Hansard source

Mr President, I have a final supplementary question. Can the Minister representing the Prime Minister outline the government's plan to tackle housing affordability in Sydney and other high-cost housing markets?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

I have mentioned one measure, Senator McLucas, and that is encouraging the states and, where appropriate, municipal governments to release more land for development. But we are doing more than that. Let me tell you something else we have done. Against your opposition, we abolished the carbon tax, as a result of which the cost of acquisition of a new home fell $5,000 below what it would otherwise have been. Senator McLucas, you complain about the price of housing and yet, directly as a result of a policy you voted for, new houses were $5,000 more expensive than they would otherwise have been. We have reversed that measure and we will not contemplate it, as you intend to. (Time expired)