Andrew Bragg (NSW, Liberal Party, Shadow Minister for Housing and Homelessness) Share this | Link to this | Hansard source

I move:

That the Treasury Laws Amendment (Help to Buy Exemptions) Regulations 2025, made under the Corporations Act 2001 and National Consumer Credit Protection Act 2009, be disallowed [F2025L01140].

I move this disallowance motion because it is a skewed priority for this government and this parliament to be pursuing. The reason I say it is a skewed priority is that, if you fail to have the houses constructed that Australians need to live in but simultaneously overly stimulate the demand side with Canberra's gimmicks, you end up with a worse situation, and that is the reality that Australia's younger people are now living. They're living that reality because the supply side has collapsed, and the numbers are very clear: 200,000 houses a year were completed in this country under the last government; now we are down to 170,000, and it doesn't look like we're going to improve.

Then there are the five per cent deposits, which are not means tested, and the two per cent deposits with the shared-equity schemes and the other things. These are all heating up that entry level point of the market. What we see in the data that has come through in the first month of the operation of the five per cent scheme, which is now not means tested and does not have place caps, is the largest uptick in prices at the entry level in years. The reality is that first home prices are too high. At the upper end of the market, those prices aren't moving.

Our concern here is not the prices of the houses for the very wealthy or the people who can look after themselves. We want to have a country where a person can purchase a house on an average wage. The problem with the inflation in the house prices at the entry level is that that is getting further and further away. No matter how well intentioned some of these demand-side measures may be, they are counterproductive because they are making the dream illusory or impossible. In the case of the five per cent deposit scheme, we're looking at a 95 per cent mortgage, which is a very heavy amount of debt for people to be carrying. That has brought forward the demand from others who would not usually use government programs.

This disallowance motion relates to the Help to Buy program, which was announced by the government in opposition back in 2022. We said at the time that, under this shared-equity program, you'd perhaps be sitting around the Christmas table with mum, dad, the kids and Mr Albanese. That won't be the case this Christmas, because the government haven't even been able to get the scheme in order. It's taking a long time to work through all the various issues they need to work through with the states. Even if you were relying on this being the great hope—the hope of the side, as it were—you'd be waiting a long time. This disallowance takes us into some of the mechanics.

One of the things the government has done to lay the groundwork for this scheme is to exempt the Commonwealth from the credit laws. The government's view is: 'Well, the credit laws are for other people. They can be applicable to the banks, the private financiers, the credit unions and everyone else. They can all comply with the rules that we've set. Don't forget, of course, that we also say that we're against red tape, even though we've created 5,000 regulations in the first term and 700 regulations in this term. But we hate red tape.' If you can keep up with it and you can fashion it into something that's coherent, then you're doing better than I am.

The point is that exempting the Commonwealth from the credit laws means that there will be no checks and balances for the Commonwealth portion. The way this scheme works is that the Commonwealth will provide up to 40 per cent of the value of the house. The other 60 per cent—or the other 58 per cent, given it's a two per cent scheme—would be provided through a loan from a bank or financial institution, and that bank or financial institution would have to go through the checks that the credit laws demand, such as the capacity to repay and the other capability assessments that you would expect to be undertaken. But for the Commonwealth share there will be nothing. There won't be any checks. Mr Chalmers—Dr Chalmers, or whatever he calls himself—will send a cheque. The carrier pigeons will take the cheque. It will be 40 per cent, and there will be no questions asked.

The problem with that is that we're looking at a $6 billion scheme. Maybe, when you're running deficits as far as the eye can see and you're covered in red ink, it doesn't matter. But I think it does matter, because the Australian people would look at that and say, 'Well, why would we be signing over our taxpayer funds without any sense of whether that money will ever be returned; why would we do that?' I guess that's really the point. That's really getting to the heart of this disallowance.

The coalition does not believe in and I put on record for transparency that we do not support this program. We voted against this program. This program was agreed to with the Greens, okay? We voted against it. I am surprised, noting our objection to the policy, that the government has decided to exempt itself from the credit laws and therefore will not be undertaking any due diligence as to how up to $6.3 billion of taxpayer funds will be spent.

I have to say that I probably don't have a great record of agreement with ASIC—in general, I don't think they've performed strongly—but I thought on this occasion they did make some constructive and important comments. They warned the government against doing this, and they made the point that the Crown is captured by the National Consumer Credit Protection Act for good reason. If the Crown is giving credit, then it's credit like any other credit and should be assessed. But the government knows best, and they decided these corporate cops—I mean, maybe the government thinks, like we do, that they're pretty hopeless. That's fair enough. But the government took the view that, 'Well, these people don't know anything; we'll just ignore them and put that piece of paper in the bin.' They went on their merry way, and they've exempted themselves from the credit act.

When the taxpayer underwrites up to 40 per cent—well, they don't underwrite it; they literally provide the 40 per cent for the house. They're not underwriting it. This is not a guarantee scheme. This is a funding scheme. They give the money over. The person has got to get their conveyancer and get their lawyer, and they buy the house. The 40 per cent Commonwealth share is just transferred over. That's it. All the best for the future! Hope for the best! It's a 'hope for the best' scheme. The taxpayer is expected to hope for the best. Maybe the market will go up; maybe it will go down. Maybe something good will happen; maybe something bad will happen. Maybe it will be foreclosed upon; maybe it won't be. Either way, there will be no checks and no balances. I think this is a reckless approach with taxpayer funds.

As I said, noting our objection to this scheme, we don't believe that the Australian people want to co-own their private house with the government. That's our objection. Putting that aside, if you were going to spend $6 billion, surely you would think, 'Well, we want to try and get some of it back; we should at least maybe think about our risk management plan, because it would be good if we could get some of that back in the future because then we can pay off the debt and we can pay for other services the community might want.' I think it is a reckless approach, and that's why I urge the chamber to think carefully about whether or not we want to be setting up a two-tier system.

Should we have a two-tier system? I think the answer is no. I think if you want to get into the business of providing credit then, surely—I think this is interference, by the way—there's got to be some kind of commitment to competitive neutrality. If it's good enough for everyone else to have to comply with the tests that people would expect—the capacity to repay and everything else—why wouldn't the Commonwealth do that?

Ultimately, this is a pattern of behaviour we've seen across the government—that there is a set of rules for the economy and then there is a set of rules which applies to the government sector, where the government will effectively act as a business in so many forms that they are prepared to write their own rules and prepared to set their own standards. I think that the Australian people will judge this very harshly, if there are monies lost in this scheme. Let's imagine that that money is going to be expended over the term of this parliament. They've got $6.2 billion that they want to spend on the scheme. By the way, this money is largely off-budget, but it's still public money. I mean, welcome to Australia 2025. When you look at the public finances, you've got no idea, really, what's going on, because there's a huge failure of integrity.

The Help to Buy funds have been borrowed by the Commonwealth. They're not on the main budget bottom line. They're borrowed by the Commonwealth, so they do hit the national debt number. The taxpayer is taking on debt. They're borrowing this money. This money is then given to people for up to 40 per cent of their property. The taxpayer will want to know what happened. We'll be asking questions about where that money has ultimately gone. What is the return over the course of this parliament on that $6 billion, if it is to be expended? At this rate, maybe none of the money will ever actually leave Canberra, because this was a promise from 2022. It seems to be taking a long time.

I make the point—and, Acting Deputy President, I compliment you on your attire.

Raff Ciccone (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Thank you, Senator.

Andrew Bragg (NSW, Liberal Party, Shadow Minister for Housing and Homelessness) Share this | Link to this | Hansard source

The point of this disallowance is very clear. We do not believe it is appropriate for the Commonwealth to exempt itself from its own credit laws when it is providing money to people so that they can acquire a property. I note again our objection to this scheme and put it on record for transparency, but I want to make it very clear that our objection in this regard is about competitive neutrality and the safety of public funds. Will there be any provision or any check that the Commonwealth will undertake to ensure that taxpayer funds are going to be returned in some form? Will there be any risk management plan at all? It looks like there will be none, because the government doesn't want to apply any protection or any oversight on the up to 40 per cent that will be provided to people for the Commonwealth's share in the Help to Buy scheme. That is the question before the Senate today. The question is: should the Commonwealth be able to exempt itself from its own rules, and should taxpayers have to accept the fact that the government doesn't give a rats about $6 billion of taxpayer funds? It's not going to do any checks. It's not going to bother to ask whether the money is ever going to come back. Ultimately, if the answer to the question is, 'The government of Australia doesn't care about whether the $6 billion will ever be returned,' then I think the government will be judged very harshly.

I urge the Senate to consider the disallowance very carefully and support it and force the government back to the drawing board. It should not exempt itself from the credit laws. It should, on this occasion, listen to the advice of its corporate regulator, which has said to it that you should not exempt the Crown from the credit laws. If the Crown is providing credit then like any organisation it should be subject to the same obligations, because, of course, the Crown's money is not the Crown's money; it actually belongs to the Australian taxpayers. So I urge the government to reconsider, and I urge the crossbench to vote for this disallowance today.

Raff Ciccone (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

I assure the Senate that Senator Bond is not in the chair this evening!

Tim Ayres (NSW, Australian Labor Party, Minister for Industry and Innovation) Share this | Link to this | Hansard source

I listened carefully to the back end of Senator Bragg's contribution. I think it is important, before I deal with some of the merits of the arguments that have been made, to understand precisely what is being proposed here and what the point of this disallowance would be. The effect of this disallowance would be to delay, make more complex and frustrate the ambitions of the government, and, of course, the people who would be the beneficiaries of this scheme. It's not just about the mechanics. In the worst case this would render the scheme inoperable.

Senator Bragg invoked the principle, that apparently he holds dearly, of 'competitive neutrality'—and he asserted that like it was the sort of thing that applied here! The point of this scheme is that it is providing equity to people who would otherwise not be able to get it. There is no principle of 'competitive neutrality'. It is just word salad that is being provided as a justification.

This scheme, the Albanese Labor government's Help to Buy Scheme, will help another 40,000 Australians into homeownership—nurses, cleaners, early-childhood educators, aged-care workers—who would not otherwise be able to afford a home of their own. Senator Bragg says this would create a two-tiered system. There is already a two-tiered system. There are people who can repay a loan but can't repay a loan at the full price for a home. This is about the Albanese government saying, 'We will use the power of the government to step in and make sure that you have the right level of equity to be able to afford to buy a home.' What is wrong with that?

I think what is being put here is a mealy-mouthed position, with lots of complaints. Any number of reasons can be put forward in order to oppose a scheme that puts working-class Australians into homes of their own. These are not substantial, significant reasons. This is just blather. For such a young man, he—Senator Bragg—is an old fogey. They've just come up with all of the sorts of reasons you would want to stop a nurse or an aged-care worker or a cleaner—lower-to-middle-income Australians—from being able to secure their own home. Just imagine: if you get on the other side of the chamber on this question and vote against it, then don't look your cleaner in the face again; don't pretend that you treat low-income Australians with respect. Honestly! Just get out of the way and allow the government to support these people.

I think it's founded firstly in a sense of intellectual arrogance—a sense that those opposite are so clever that, unless they've designed a policy mechanism themselves, there's no way. It's from their sense of entitlement that drives them into public office. It's their way or no way—even if the consequence of that is that 40,000 ordinary Australians stay on the rental market forever, forever paying somebody else's mortgage. It's so utterly heartless, so completely self-involved, so utterly driven by a sense of entitlement.

There's a sense of snobbery that drives this position. Senator Bragg says, 'Australians don't want to co-own their home with the government.' Well, if you don't want to co-own a house with the government, don't buy a house with the government. There's a sort of snobbery that looks down on people in community housing or in public housing. These are people who have a steady income and can repay a loan, and will work their guts out to repay a loan. But the snobbery of the Liberal Party says: 'You're not up to it. We're only for other people—not for people who work hard. We're for other people.' It's that sort of born-to-rule sense of entitlement that means that you can offer a mealy-mouthed phrase like 'competitive neutrality' that means nothing in this context. It's meaningless. Is it because you're entitled by a sort of birthright to the role in the Liberal Party that you just get to say no to these people—say no to the cleaners, the childcare workers, the aged-care workers? You live in your own home, and pay your own mortgage, but you say to them, 'You're not good enough for that.'

Let's put aside all that cruelty and all that snobbery for a moment. Senator Bragg claims that it's reasonable to say that the same prudential regulations should be applied to the government. What a silly argument. What a vain argument. The truth is that these mechanisms will be driven by the banks that offer the loans. The prudential regulations apply to them. They have to discharge their obligations. Why would you set up a regulatory environment that says: 'We're going to double up the requirement. We're going to have not just one set of prudential requirements but effectively two. We'll have two decision-makers who might make different decisions'? Have a look at yourselves. Have a look at the people who you are disadvantaging and think about whether that's really a serious argument that an adult would make.

I understand that the Liberal Party and the National Party don't like government engaging in the economy to support ordinary people. I don't agree with it, but I get it. But we have been elected to perform this function by people who saw Labor's Help to Buy scheme and said, 'I can get into the housing market.' I know these people. These are people in my family and in my community who say: 'I could get partial equity. The value of my home will grow over time. I'll pay that mortgage. I can sell the home, with the government share declining in real terms over time as the value of the home increases. I can make a quid out of this. I can get a foot on the ladder.' But the Liberal Party and the National Party, under Ms Ley, say, 'No, it's not for you; it's just for us.'

I've had people in my office in tears with the hope that our five per cent deposit scheme gives them. One of them, just a few days ago, said: 'My HECS debt is gone. I can do a five per cent deposit. It's a real thing for me.' And these guys say, 'No, it's not for you; it's just for us. Don't worry about it, young people. You can flog yourselves for 15 years and try to save a deposit,' while, under the Labor Party government, these young people get to have a crack in a period of time that they can see and imagine.

Honestly, I can't believe the pile of garbage arguments that get mounted up in order to justify it—that it's a demand-side mechanism and all this econobabble. It is a real thing, and these are real people. These are people you might never meet or want to associate with, but they are real people. They may not be in the gentlemen's clubs and all that sort of stuff that you lot carry on about, but they are real people—young people, low-income people—who get to have a crack. But you want to just stand in the way and say, 'No, it's not for you.'

The majority of our package, our $43 billion package, is of course allocated on the supply side. It is working with the states and territories and with the community housing organisations to drive more activity in the housing market. We've set ambitious targets to do that, and we'll be measured on our success over time. The problem with the Liberals' argument is that they say, 'How many homes did you build?' on Wednesday and then they say, 'How many homes did you build?' on Thursday and it's not less than the day before. The number keeps increasing. It gets bigger. Those are hard things to do, and they require the government getting active and working with developers, and you get this nitpicking, undermining, snobbery driven response from the Liberal Party. That's what you get. It's mean-spirited. It's snobby. It's obstructionist. It's intellectually arrogant. It's born to rule.

The problem is that when you wreck things and try to establish a coalition of support across the chamber that has everybody engaged, and sometimes con the Greens to supporting your position, ordinary people pay. When you wreck these things it hurts cleaners, it hurts nurses, it hurts coppers, it hurts council workers and it hurts tradies who just want to have a crack. They just want to have a go. Maybe spend a bit of time over the Christmas break reflecting on what actual effective opposition should do. It actually involves sometimes backing the government, or backing policies that you wouldn't have written yourself. We did it plenty of times in opposition between 2019 and 2022. It was a pretty good model, a pretty successful model.

I watched Niki Savva with some interest on Sunday. I'm often out doing things on a Sunday morning, usually trying to do a few things around the house to make up for the fact I'm not often around during the week. She said the problem for the Liberal Party is they have got an existential crisis. Then she went on to say that the problem for the Liberal Party is they have an identity crisis. They don't know who they are. I've been around politics for a little while now for a young bloke. I've been around for a little while. I know from experience that you can have an existential crisis after a bad result, but if you know who you are and what you stand for, and you understand what makes up the movement you are in and your place in history and Australian democracy, then you can work your way through a tough existential patch. If you have an identity crisis, you have your existence to rely upon. You've got time to figure it out and you're not in a mad rush. But if you have an identity crisis and an existential crisis at the same time, you are in all sorts of trouble because you don't know who you are, you don't know what you stand for and your capacity to solve these problems in the interests of Australians gets smaller and narrower every day. That is the problem with your policy formulations, whether it's this or your approach to the energy questions.

I can see the sea change that's happening across this chamber as One Nation and Mr Joyce and all these characters actually in charge—Senator Sharma shakes his head, but he's in a diminishing part of the old moderate part of the Liberal Party. It doesn't really exist anymore except in a tiny little fraction of New South Wales. It's been bullied out of existence by these other characters who have given the game away on the centre ground of Australian politics. They want to move to the extreme right, and that's where you end up wrecking things and hurting ordinary people and ordinary Australians. That's what voting for this proposition would deliver—nothing more, nothing less. It's just pain for Australians you will probably never meet.

Dave Sharma (NSW, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

I really don't know where to start after that contribution. Here I was expecting a defence of Labor's housing policy, and instead we've had a series of ad hominem attacks against people on this side of the chamber. We've had some amateur channelling of Siegmund Freud, trying to psychoanalyse the coalition's internal dynamics.

We also had, frankly, some quite insulting things said by the minister. He suggested, firstly, that we don't seek to represent people, and I think he tried to claim some sort of moral high ground that only his side of the chamber represents working people. I remind him that it was our political party that increased homeownership under Robert Menzies. It's our political party that has delivered higher living standards.

Tim Ayres (NSW, Australian Labor Party, Minister for Industry and Innovation) Share this | Link to this | Hansard source

When was that? How long ago was that?

Dave Sharma (NSW, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

Menzies was the postwar prime minister from the Second World War. Throughout our history, including in the recent term of the coalition government, it's been a coalition government that has improved living standards for Australians.

Tim Ayres (NSW, Australian Labor Party, Minister for Industry and Innovation) Share this | Link to this | Hansard source

Three hundred and thirty-seven homes!

Dave Sharma (NSW, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

Minister, I did listen respectfully, despite the nonsense that was streaming forth from your mouth, and I'd expect the same in return.

We haven't had any defence of this policy whatsoever. I think there are grounds for common agreement here. I think the Labor Party—and even Senator Ayres, despite me being so appalled by his most recent contribution—genuinely thinks that Australians owning a home is a good thing. We, here, on this side, do as well. But I think where we differ—

Tim Ayres (NSW, Australian Labor Party, Minister for Industry and Innovation) Share this | Link to this | Hansard source

Just not those ones. Just not them.

Dave Sharma (NSW, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

We can have a legitimate policy difference here without me needing to attack your personal motives or your connection to the public, Senator Ayres. We can have a legitimate policy difference here. Where we differ is that we think Labor's policies, including this one, are making the housing problem worse. Every time the Labor government intervene in the housing market in some way, they might temporarily privilege or advantage one group, but it's to the detriment of the overall health of the market.

Housing is not just an asset class; housing is a social good. And I think everyone in this chamber recognises that. If someone owns their own home, it means they're more likely to have—please don't leave, Minister. I've been enjoying this.

Raff Ciccone (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Let's keep comments through the chair.

Dave Sharma (NSW, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

Sorry, Acting Deputy President. I'm regretting Senator Ayres leaving after that high-intellect contribution earlier!

Homeownership provides security in retirement. Homeownership provides the foundation that families need to have confidence to enlarge their families through having children or adopting children. Homeownership also provides the security to build communities and invest in communities. That's why the level of homeownership in Australia—not for a particular sector or a particular group of people but for all Australians—is so important. It's not just their financial health and wellbeing; it's the health of the nation.

Undoubtedly, homeownership is out of reach for too many Australians today, and this is an intergenerational failing. It's part of failings, I'll concede, on both sides of the aisle over probably two to three decades now. We have not been building enough homes. The problem with these sorts of schemes, whether it is the Housing Australia Future Fund or the Home Guarantee Scheme or the Help to Buy scheme, which is the subject of this disallowance motion, is that Labor's fixers are fuelling demand in certain sectors of the market, but all that does is push up prices. Perhaps the people they're helping today will get a foot on the property ladder, but they are pushing everyone who is not the beneficiary of this particular scheme on this particular day further down the ladder.

Fundamentally, every one of these policies has unintended consequences. We heard from the minister before that he recognises that supply is an issue. But, if that's the case, why aren't all these supply measures? They're all demand measures. The Help to Buy scheme, the Home Guarantee Scheme and the Housing Australia Future Fund—all we have is more government intervention in the market adding to demand.

When the coalition were last in office, we averaged—well, we weren't building the homes. We don't pretend that the government should be building homes. We think private capital and private investors and people who are seeking to build a home themselves should be building them. But home construction averaged 200,000 a year. Under Labor, so far it has averaged 170,000 a year. The most recent statistics from the ABS say that the number of new home constructions in the 2024-25 fiscal year is lower than in the 2023-24 fiscal year. In the first year of the housing compact, the housing targets, the Labor government is already 66,000 new home starts behind.

So it's all very well for the minister to say that this scheme will help nurses, cleaners, council workers or teachers. But, if all it is doing is pushing up prices for those nurses, for those council workers, for those teachers and for those cleaners and pushing up the prices for everyone else, then no-one is better off. At heart, philosophically, as a matter of policy, that is the problem with this government's approach to every issue. It's a reflexive reach for government intervention in a market. The first-order effects might seem positive, but the second- and third-order effects and unintended consequences are incredibly negative.

Take, for instance—I have to make sure I've got the names right—the home guarantee scheme. The home guarantee scheme is the deposit scheme. I think I've got this right. That was the home guarantee scheme, not the Help to Buy scheme, which we're talking about now. What we've seen since the home guarantee scheme commenced is, already, the biggest monthly rise in house prices across Australia in years. Cotality, the data collector and aggregator, confirmed that the strongest growth seen in housing prices was in the lower and middle quartiles of the housing market, the sorts of properties that first home buyers are targeting. Cotality research director Tim Lawless said this price growth was due to 'likely a pick-up in first home buyers taking advantage of the expanded deposit guarantee'. So what we've got with the home guarantee scheme and what we will soon have with the Help to Buy scheme is the government basically putting more money into people's pockets to purchase homes without creating any new homes. If you've got more money chasing a finite or fixed supply of goods, or even if you've got money growing at a faster rate than supply is, that is what constitutes inflation. Just today, we saw the monthly inflation figure at 3.8 per cent. Do you know why monthly inflation figures are so high? It's because real government spending is growing at four times the rate of the economy. Real government spending, four times the rate of the economy.

That macro picture is being replicated here at the micro level, at a sectoral level, in the housing sector. We have got more government money going into a sector without doing anything to address the supply side. We've got the so-called Housing Australia Future Fund. That is the supply-side measure. That's what's meant to be building homes. All we've got so far from the HAFF is that they have 'completed' 889 homes but they've failed to disclose, or refused to disclose, whether these homes had been built by the HAFF or had been acquired. When we last got a concrete figure on this from the finance minister, Katy Gallagher, she revealed, at last year's Senate estimates, that the HAFF had built zero homes—absolute doughnut. Instead, it had acquired—that is, it had bought or purchased—340 homes. So the HAFF scheme, the supply-side scheme, is only operating on the demand side of the market. We've got the home guarantee scheme on the demand side of the market. And now we've got—I've got to remember these names—the Help to Buy scheme, also only operating on the demand side of the market.

I can't be any clearer than this. More government intervention on the demand side is not the answer. All that will do is drive up prices further. Just as government intervention in other parts of the economy fuels inflation and pushes up prices, that is exactly what this scheme will do.

This disallowance motion is directed at the Help to Buy scheme, predominantly because the scheme seeks to exempt itself from the National Credit Code. The National Credit Code is there for a reason. It's there to protect consumers, and it's there to protect Australian financial interests. The regulatory agency ASIC knows that it was and has always been the intention of the parliament for the code to apply to credit provided by the Crown. The Crown is providing credit in this instance, and we in the coalition believe that this scheme should be subject to the normal oversight that applies to credit instruments in all their entirety.

Debate interrupted.