20 July 2017
Transcript - #2017003, 2017

Joint doorstop interview, Melbourne

SUBJECTS: Turnbull Government’s policies to reduce pressure on housing affordability; Turnbull Government’s First Home Saver Super Scheme to give first home buyers a tax cut; Labor’s proposal to smash the housing market and drive up rents; Kevin Rudd and Labor’s immigration policy lies; Communications portfolio; Liberal Party

MINISTER SUKKAR:

It’s good to be here at Jubilee Housing with the Treasurer, looking around at what is a wonderful community housing provider. Jubilee Housing have 40 homes that they provide for people who need assistance. Here we’re on a site that was built in 1996, the Treasurer and I have had an opportunity to look inside, and look around. Really it looks like any suburb you’d find around Australia. This is providing lost cost accommodation to people who need it, and as you all know in the Budget led by the Treasurer, and myself, we brought down a housing affordability package that didn’t just do what ordinary governments do and that is pick one sector of the housing market to address, we have attempted to deal with a range of issues on the spectrum of housing, whether it’s those suffering from homelessness, those trying to enter the private housing market, first home buyers and everyone in between. One of those in between is those who are in social, public housing, and we believe that community housing providers like Jubilee are going to be much more important into the future in providing homes, such as these, to people who need that assistance, and we think that the Government is going to work very closely with community housing providers through the bond aggregator, the finance and investment corporation, and a range of other measures, to try and assist community housing providers that the scale, the efficiencies, the corporate governance and the other things that they will need to grow the sector, because we want to see more organisations like Jubilee get even bigger. So Treasurer can I thank you for being here today in Burwood at Jubilee Housing. Can I think you for the commitment and the support you’ve given me and the entire Government, in this housing affordability package which was a key part of the Budget.

TREASURER:

Thank you Michael. It’s great to be here at Jubilee, and great to be in Victoria [inaudible]. I just want to congratulate Jubilee on the work they’ve been doing serving the community now for many, many years. You look around a development like this, as Michael said, developed back in 1996, the number of people who have come through here, the family photos on the walls, the homes that have been created, the support that’s been provided through Jubilee is something that we want to see continue and grow. Here in Melbourne, we’ve seen rents rise in the past 12 months by about four to five per cent, and depending on whether you’re talking about apartments or houses, and I know so much of the housing affordability issue tends to focus on the first home buyer market, and that’s important, and when we go back to the Parliament, Michael and I will be bringing forward our Super Savings Scheme to support first home buyers, and we’re calling on the Parliament to support that. That’s a tax cut for young home buyers in particular, to be able to save 30 per cent more quickly to realise their dream of buying their first home.

But it’s not just about first home buyers, it’s about renters, it’s about affordability, it’s about people on low incomes in a big city like Melbourne or in other places, that are struggling to deal with their rent. In this year’s Budget, I said we needed to do four things, we needed to grow the economy for more and better paid jobs, I said we needed to guarantee the essentials that Australians rely on, Medicare, education, issues like that. I said we needed to put downward pressure on rising costs of living, and doing something about affordable rents is key to that challenge and that’s why we’re here today and I said we had to live within our means and I’ll have more to say about that when I address the Melbourne Institute later tonight here in Melbourne. But affordable housing, and dealing particularly with those on low incomes, requires bigger stronger, partnerships between state, local and federal governments but also in the community housing sector and the private sector, and that’s what this year’s Budget has delivered. It’s a comprehensive package that Michael and I have brought down as part of this Budget, and it’s a package that we know can give real support to make investment in affordable accommodation in Australia whether it’s here in Burwood or it’s Hobart, or it’s in Western Australia or Darwin or in remote areas. Wherever it is, we need to understand that housing is an essential of life. It’s an essential for families and it’s essential for people who are elderly, young, right across the spectrum and we want to see the community housing sector thrive, and that’s why we’ll be implementing measures like the bond aggregator, the tax concessions, for investment in affordable housing, whether it’s by mum and dad investors who are negatively gearing those investments, or indeed foreign investors who were channelling their investment into building accommodation just like this all around Australia. Thank you.

QUESTION:

Treasurer, housing experts say that the model for rental accommodation in Australia is completely broken and needs to be rebuilt, what exactly can be done?

TREASURER:

This is exactly what we’re addressing in the package we handed down in the Budget. Right now, Michael and I are renegotiating the agreements with state governments, all around the country, with all of the other Treasurers, in terms of how housing funding is being delivered. It is a partnership between federal and state Governments in terms of how housing support is provided. We provide together some $11 billion a year into the housing assistance at state and a federal level. It has to be spent better. The previous National Affordable Housing Agreement wasn’t doing the job. It was just a one way ATM with no accountability, no requirements to provide additional supply or see more projects like this delivered. None of it. It was just a cheque in the mail. Michael and I are working to change that, working in a good partnership with the state and territory treasurers to get to a much better deal. That’s what we’re doing right now. On top of that, the model that we’ve embraced is to see more private sector investment come into developments like these in a contemporary setting. We’ve put tax incentives in place in the Budget to achieve that. A 60 per cent capital gains discount for those who invest in affordable housing. The establishment of the managed investment trust vehicle to be able to use for investments in affordable housing. Now, they are real, serious tax incentives for investments in affordable housing that are necessary to draw the investment that is needed to see these projects go ahead. The other thing that’s needed to make that project go ahead, is the housing association, the community housing associations, being able to build up in scale and size, and access capital more effectively than they have in the past to work with private sector developers, inclusionary zoning by councils, that’s what’s in our housing affordability package. It is a comprehensive plan, it’s not a silver bullet, it is the full artillery when it comes to dealing with housing affordability in this country.

QUESTION:

What do you make of Kevin Rudd’s tweet from last night saying that he would have re-housed these refugees after a year?

TREASURER:

Are there other questions? I’m happy to address, I’m very happy to address that. Are there any other questions on housing while Michael and I are dealing with that issue?

QUESTION:

Will the measures that you’ve just described actually unlock the billions of dollars in investment funds that are currently not being invested in the Australian built for rent market?

TREASURER:

That is certainly our intention and that has to be achieved together with state governments. One of the frustrations when I went to the UK earlier this year, and I looked at what is a very sophisticated housing mutual sector there in the UK, is that Australian super funds are investing in affordable housing in the UK. Pension funds in Canada and the United States are investing in affordable housing. There is capital available to invest in these projects but in Australia we haven’t seen that to the scale that we have in other countries. That’s what the managed investment trust was about, creating both the vehicle for these funds to invest, and the right tax incentives to attract that investment. So, it’s a serious plan and it’s going to the heart of what the challenge is, how do you get the money in. But at the same time, as we were just chatting to the directors and others here from Jubilee, you have got to provide the development capital, but you’ve got to keep the heart in it. Jubilee has a big heart for people who need affordable housing and we want an affordable housing sector with the financial nous, the financial gravitas, but also the big heart that is necessary through community organisations like this, so that excellent support can be delivered. Did you want to add anything to that Michael?

MINISTER SUKKAR:

Scott, I’d echo your comments. The reality is that between the bond aggregator, the tax incentives that are in place, our package is designed to unlock primary investment into affordable housing, and it is galling when we look at other jurisdictions and we see there is a hell of a lot of capital floating around the for the exact type of projects that we’re after but we haven’t up until now had the right settings in place, to unlock that. So I give the Treasurer credit, he came back from the UK, had seen the housing mutual model over there, and really championed the tax incentives and of course the bond aggregator which we’re in the process of setting up now. That we hope is going to unlock literally hundreds of millions, if not billions of dollars, that will ultimately be funnelled into fantastic affordable housing projects. One of the reasons we’re at Jubilee today, as the Treasurer said is, we want the best of both worlds, we want that institutional capital, but we don’t want to lose the heart, the pastoral care and the support that really makes these projects work.

TREASURER:

So the National Housing and Finance Investment Corporation kicks off on the first of July next year. That will be supported by the Housing Infrastructure Fund which will [inaudible] in its activities to deal with local infrastructure issues that needed to be addressed to unlock particular developments. Those things working together with the tax incentives is really a formal, comprehensive plan.

Ok, Kevin Rudd. Well, I was Shadow Minister for Immigration at the time, and obviously took on the role of Immigration and Border Protection after the 2013 election. I remember at the 2013 election, the Labor Party used taxpayers’ funds to run ads during the election campaign calling, absolutely galling, apparently they were trying to stop people at the Royal Motor Yacht Club in Port Hacking from allowing their vessels to be used for people smuggling because they were putting ads in the Sydney Morning Herald, using taxpayer funds during the election campaign. Do you know it said on those ads? You will never, ever be resettled in Australia. Well now Kevin Rudd has actually belled the cat on his own hypocrisy, and on the Labor Party more generally. So apparently it was never, ever would you be resettled in Australia in the next 12 months. We always said at the time that the Labor Party when it came to protecting the borders and the integrity of our immigration system, that their heart was never in it. It was all just a political stunt and Kevin Rudd has proved once again that when it came to border protection, his Government and the complicit partners in that Government, which include Chris Bowen who was the Immigration Minister at the time, when it came to border protection were complete and utter phonies.

QUESTION:

What do you make of this tweet, is he delusional?

TREASURER:

No I think he’s telling the truth. I think Kevin Rudd is telling the truth. Kevin Rudd is telling the truth that what they took to the 2013 election was a big fat lie. They were lying to the Australian people about border protection then. Remember before he was elected, he said he’d turn back boats. I mean he lied to the Australian electorate in 2007, and look, the Labor Party keep lying when it comes to border protection. You cannot trust them. Don’t just listen to what I say on border protection. My record, and the record of Peter Dutton, and my colleagues the Prime Minister and former Prime Minister speak for itself. We did it. We did stop the boats. We did what we said we’d do, we did it in the way we said we’d do it, and we got the results we said we would get. That’s why you can trust the Coalition Government on border protection and you can never, ever trust Labor.

QUESTION:

Tony Abbott has contradicted himself it appears on a Home Affairs ministry. Yesterday he questioned it. A month ago he said there was merit in the idea. What do you make of his contradictions?

TREASURER:

I’m not engaging in any of that. I’m just not interested. You guys might be. I’m not.

QUESTION:

None-the-less it does undermine the Government’s announcement on the Home Affairs Ministry.

TREASURER:

Rubbish.

QUESTION:

Was it a captain’s call by Malcolm to introduce this super ministry?

TREASURER:

It’s a machinery of Government decision and a machinery of Government decision is made by the Prime Minister. Always has been. Always should be. I applaud the Prime Minister for making the decision that he has. As you know, I’ve been a keen advocate of this going back to the time we were in opposition. I saw first-hand where the home office model has worked successfully in the UK for centuries. It’s not like it’s a new idea. It’s been on the ground running in the United Kingdom for centuries and is the model adopted in many other, particularly Commonwealth jurisdictions, that have picked up the model out of the UK whether it’s in India or Malaysia or other places, it’s a good way of ensuring that all of the agencies are pulling in the one direction. When I was Immigration and Border Protection Minister the reason Operation Sovereign Borders worked, is that all agencies that were involved directly in that campaign and continue to be today, came under a single chain of command, back to one overall commander which was General Campbell in my case, through to one Minister, through to the Prime Minister. When you get a clear chain of command when it comes to National Security it works.

QUESTION:

Is everyone pulling in the same direction in Cabinet?

TREASURER:

Yes.

QUESTION:

The Government is giving $30 million to Fox Sports which is owned by NewsCorp. What’s the justification for this $30 million [inaudible]?

TREASURER:

Well that was a measure that was announced in the Budget and there are a range of programs there to support the various programming that they’re undertaking, look I’d have to go back over the specifics. As you know the Budget is a $440 billion initiative, those measures were there to support some important programming and other initiatives that the Government deemed worthy of support like many other projects in a $440 billion Budget.

QUESTION:

But what are the requirements in the funding?

TREASURER:

As I said, I’m happy to come back to you on the specifics, and we can follow that up through my office and the Communications Minister who specifically was involved in negotiating those arrangements. He could provide you with detail.

QUESTION:

It appears there is no paper trail for this $30 million.

TREASURER:

Well you can make all the assertions you like, but that doesn’t make them true.

QUESTION:

Is there a paper trail?

TREASURER:

Well again I’m happy to deal with the issue offline.

QUESTION:

Can I just ask, do you support…

TREASURER:

Do you want me to read that out?

QUESTION:

Sure.

TREASURER:

I’ll just read the questions out, I’ll save you the trouble. Who is sending me the questions? I should know who’s asking them actually.

QUESTION:

Just the last two, do you support the plebiscite for preselection in NSW?

TREASURER:

I’ve always been in favour of democratisation in the Liberal Party, wherever it is. I’m a former director of the party in New South Wales and I believe that’s a decision for the members. I don’t think it’s my job, as a parliamentary member of the Liberal Party to be going round lecturing the organisational wing about how it should be done [inaudible]. That’s a matter for our organisation. I’m a fierce defender of the organisational wing of the Liberal Party to make its decisions on the issues that are within its domain. And that’s an important principal of the Liberal Party and I intend to respect that by not offering a public commentary.

QUESTION:

Do you think it will help boost Liberal numbers?

TREASURER:

I think I just gave you my answer on how I respond on that issue. That’s a matter for the organisational wing and I’ll participate in their forums and that’s where I’ll make my contributions. Thank you.