Is the government serious about housing affordability?
I rise to speak on the Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 1) Bill 2017 and the First Home Super Saver Tax Bill 2017.
Over time the phrase 'the great Australian dream' has meant different things to different people, but for the better part of a century any reference to this phrase meant owning your own home. In his 'The Forgotten People' speech to a radio audience 75 years ago, Menzies said:
The material home represents the concrete expression of the habits of frugality and saving "for a home of our own." Your advanced socialist may rave against private property even while he acquires it; but one of the best instincts in us is that which induces us to have one little piece of earth with a house and a garden which is ours; to which we can withdraw, in which we can be among our friends, into which no stranger may come against our will.
During his time as Prime Minister, there were a number of federal and state housing schemes that made buying a house more affordable and accessible. By 1966, the number of Australians who either owned a home or were living in a house that they were purchasing was significantly higher than in the early 1950s. At one stage, the dream was sold as a red brick home on a quarter-acre block with a Hills Hoist in the backyard. How things have changed! For many, owning a home is now becoming increasingly out of their reach, with the current state of the housing market meaning that many are missing out. The September Domain State of the market report revealed the median house price here in the ACT reached a record high of $723,980, and we have reports that the median house price in Sydney is now $1 million.
Despite the challenges facing first home buyers, an Australian National University report titled Attitudes to housing affordability: pressures, problems and solutions found that nearly three-quarters of Australians weren't prepared to give up the dream and viewed owning a property as part of the Australian way of life. Just seven per cent believe that owning a house is not all that important—just seven per cent from this ANU study. While views of the great Australian dream remain the same, confidence that it can actually be achieved continues to decrease. Close to 70 per cent of the participants said they were very concerned or somewhat concerned about whether they will own a property. For those who own a home, the poll highlighted the difficulties they face. One in five Australians reported difficulty keeping up with a mortgage or a rental payment, saying they're either falling behind with their payments or struggling to make their payments. Nearly a quarter said they would face financial stress in the event of a two percentage point interest rate rise, and to combat this they're spending less on essentials, they're working multiple jobs, they're working longer hours, they're delaying starting a family and they're even selling household items to make ends meet. The government's cuts to penalty rates do not help this one bit.
With housing affordability spiralling out of control, the government believes that part of fixing the problem is allowing first home buyers to take advantage of the concessional taxation arrangements that apply to the superannuation system. Under the First Home Super Saver Scheme, first home buyers who make voluntary contributions into the superannuation scheme can withdraw those contributions and an amount of associated earnings for the purpose of purchasing their first home. What this fails to acknowledge is that superannuation was created to generate retirement income. It was created to ensure that Australians had a comfortable retirement. It was not created for buying a house. The government's scheme has received fanfare, particularly when it was announced on budget night, but it allows people to put away only $15,000 a year extra through contributions to their superannuation pre tax, and it can be used for only two years, equating to a maximum saving of $30,000 for singles.
The government also jumped the gun when the Treasurer talked up the scheme on social media in July, well before any legislation was introduced. Labor has long argued that the focus of the government should be on reforming negative gearing and the capital gains tax discount because 50 per cent of the benefit of negative gearing goes to the top 10 per cent of income earners and 70 per cent of the benefit of the capital gains tax concession goes to the top 10 per cent of income earners. Those figures are staggering. They clearly show that the current arrangements aren't to the benefit of first home buyers.
The other measure in this bill is about contributing the proceeds of downsizing. This will allow people aged 65 and over to make a non-concessional contribution of up to $300,000 from the proceeds of selling their home. If this measure were split from the First Home Super Saver Scheme there is a chance that Labor would consider this measure, because we're not opposed to the principle of helping Australians downsize. That's why when we were in government we made a multibillion dollar investment—historical investment—in social housing, to get those Australians who were in large family homes and who were empty-nesters into social homes, to free up that market for new families.
I've got areas in Rivett, I've got them in Curtin, I've got them in a range of suburbs right across my electorate, where we built these new social houses that were the brand new townhouses that assisted people in downsizing. These houses provided them with all the facilities they needed—a lovely terrace garden out the back; facilities allowing them to transition as they aged—and it freed up family sized social housing. It was an historic investment in social housing, the largest investment in social housing in Australia's history, all thanks to Labor when we were in government. So we understand the importance of downsizing, and we put our money where our mouth is. We did it when we were in government.
In the 2013-14 budget we also had a pilot program aimed at helping people downsize. We had that program that was designed for social housing; we also had a pilot program where people on aged pensions who wanted to downsize from their family home could do so. It's a means-test exemption. Up to $200,000 in proceeds would have been put into a fund that would have been exempt from the pensions means test for up to 10 years. It was this government's own short-sightedness that saw this measure scrapped. And questions on notice about the government's own downsizing measure saw Treasury fail to answer how many households would be expected to downsize as a result. It speaks volumes about where this government's priorities lie in this space, in terms of downsizing, housing affordability, negative gearing and capital gains tax, and just in terms of appointing a minister for housing and homelessness.
The top recommendation from a Senate committee on housing affordability in 2015 was:
… that the Australian Government appoint a Minister for Housing and Homelessness, with the portfolio to be located in a central agency such as the Department of the Prime Minister and Cabinet or the Treasury, or in the Department of Infrastructure with formal links to the central agencies.
This advice is two years old now, and what have we got from the government? Complete and utterly deafening silence. The government has ignored this advice, instead placing the responsibility for housing affordability and homelessness with the Minister for Social Services—and, right now, access and affordability just doesn't seem to be high on the priority list.
I am very concerned about where this government stands when it comes to housing affordability, particularly for those who are the most vulnerable in our community. This is a significant issue right across Australia, and it's a significant issue here in the ACT. It's a significant issue that was discussed at yesterday's ACT housing and homelessness summit. Community organisations, through that summit, are looking to the future when it comes to the types of affordable housing options being offered to Canberrans. We have to start looking at a range of options. We had that social housing model, the traditional family house I mentioned earlier, where we assisted with downsizing. That is one option, but we need to start getting creative and innovative in our housing options for the future, because one size won't fit all.
We need a range of solutions and a range of options for the many and varied families that we have in Australia. We have single women—I will speak about them in a motion later in this speech—and there's a significant challenge for older single women. In fact, this is one thing that keeps me awake at night: the tsunami of homelessness that is going to come for aged Australians, particularly older Australian women who have very little super and are currently in very low paying jobs. They are usually divorced and renting in the private rental market. The thing that keeps them awake at night is: 'What's going to happen to me when I retire from work? I own too much to be in social housing, yet I have limited super.' Facing being in the private rental market on a pension is a pretty grim future. That is the thing that keeps them awake at night, and it keeps me awake a night too. Every time I speak about this issue, I have women coming up to me after my speech, in tears, saying: 'You are speaking about me. You are talking about my future. I am worried; I am scared witless about what retirement means for me.' The options that we have at the moment are very limited for women like this.
Options were discussed at the homelessness and housing summit. There's the Nightingale option—the Nightingale model—which is a housing option that's growing in popularity. It was discussed as a possible alternative to lower the cost of housing in Canberra. It originated in Melbourne, and it focuses on sustainability and affordability. It cuts out the traditional developer, who limits investor profit margin, in an architect led model. The construction of the first Nightingale building in Brunswick is expected to be completed next month, so I look forward to hearing about the outcome of that.
Another model that I'm very attracted to is the model that the YWCA here in Canberra implemented a number of years ago, called Lady Heydon House. It is working very successfully. It's a housing arrangement for five older single women. Each woman has her own unit and her own access to her unit and carport, but there's also a communal living space. The units are metered and billed separately, but the cost of living in those units is not prohibitive; it's not crippling. As I said, these women are on modest incomes, have little super, are usually divorced and are still in the private rental market. This gives them the option of dignity in their retirement, and also the option of not being socially isolated by living in a one-room bedsit. How many of us, when we were students, lived in little one-room bedsits? Is that how we want to spend our time at the end of life? It was difficult and challenging enough as a student. That's not what I want for Canberran and Australian women in their retirement. I want them to have a dignified retirement, where they still feel they are contributing to the community, they are engaged and they are not socially isolated. That's why Lady Heydon House is very attractive, but there are other options for cooperative housing. We need to start exploring this and start getting far more innovative in this space.
As I said, the Equality Rights Alliance did a report a number of years ago where they were talking about this tsunami of homelessness for Australians. From memory, about 600,000 women in the next five to 10 years are potentially facing homelessness as they age, because of the circumstances that I outlined before. There are also 300,000 men. This is going to be a big problem and we need to start addressing it now. This is why the government's lack of a minister for housing and homelessness is a real concern. There is no-one actually focused on addressing this issue—this tsunami that is going to hit Australia in years to come of older Australians who have contributed all their lives to our society. Here they are, and how do we repay them? We repay them by making them homeless. It is a very, very big concern.
In the short time I have left, I want to underscore the fact that we have a significant issue with homelessness, potentially in older women, in years to come. We know that on the night of the 2011 census, 44 per cent of Australia's homeless population were women. The YWCA has been calling for appropriate, affordable and stable housing for women for a very long time now. It's why it's important that the government appoint a minister dedicated to housing and homelessness. It's why this government needs to show leadership on the housing affordability and homelessness issue—not tomorrow, not in the near future, but yesterday.