Interview with John Stanley on 2GB

🌐 Andrew Bragg, Shadow Assistant Minister for Home Ownership - Nights with John Stanley

Subjects: Home ownership, housing supply, stamp duty

E&OE………

John Stanley

The issue of housing is, I think, going to be front and centre at the next federal election And it does strike me, it's a particularly big issue with younger people. We've had Chris Rath, the young... Well, I say young. He's in his 30s. He's 34. He's the Opposition Whip in the New South Wales Upper House. We heard a little bit of Keith Wolahan, the Victorian MP talking last week about how important it is for the Coalition to try and reach younger people on this housing question. And earlier tonight, looking through the news bulletins talking about medium density housing and some of the planning changes in New South Wales. It's young people putting their hands up saying; well, we actually think this isn't a bad idea because we want to know where the housing is going to come from that's affordable that we're going to be able to get into in the future.

John Stanley

So in the context of that, I wanted to speak with him since last week when he was appointed to the Shadow Ministry the Liberal Senator for New South Wales, Andrew Bragg. He's the Shadow Minister or Shadow Assistant Minister for Housing Affordability. I think I've got his title right. He's on the line with us now. Senator Bragg, good evening to you.

Senator Bragg

G'day, John. How are you?

John Stanley

Well, you'd agree with me. Am I right? You're just still in your 30s. Is that right?

Senator Bragg

That's right. Yeah. Just hanging on by my skin of my teeth.

John Stanley

But it is a generational thing, though, isn't it? The more you talk to people in their 30s and their 20s, they're saying, where's the housing going to come from? Why is it costing so much? And how can we get a deposit to get in?

Senator Bragg

I think for many Australians under the age of 40, this is their biggest issue. And I think it'll be a huge issue at the election next year because so many young people feel that they'll never get a go. They'll never be able to own a house. And as you know, John, that is the key for a secure future, home ownership, that is.

John Stanley

Yeah. And look, the issue, I know you've talked a fair bit about this, and I've had people contact me, they're talking about the superannuation policy that the Coalition took the last election. I know you've had strong views on this over a very long period of time. Before I get to that, the Greens, certainly in the inner city, they're making a lot of ground by talking about housing and talking about the idea of trying to produce more affordable housing and affordable rental properties. And a lot of your colleagues, your younger people in their 30s like you, were saying, well, we need to match that and say we've got plans as well.

Senator Bragg

Well, I mean, the Labor Party want the big super funds to own the houses. The Greens want the government property developer that they want to create to own the houses, and we want the people to own the houses. So we are in favour of private development, and that necessitates building more houses. So that is the starting point. I mean, you can't solve this without the supply side.

John Stanley

Okay, so let's get to that. In terms of supply side, you've just got into this portfolio and into this area. It is obviously a function also of the States. They need to deal with this, and then immigration comes into play. So what are your overall thoughts initially on where you can go in terms of, let's just start with supply, trying to kickstart supply and get it happening more?

Senator Bragg

Well, John, it's true. I am relatively new to this, but I think anyone who's worth their salt knows that this issue is very complex. And I think most colleagues have done some research on it. Unless you build more houses, then we're not going to solve the problem. You can't solve the housing issue just with demand side solutions. So effectively, the planning and zoning rules have been a major problem. There's been NIMBYism, there's been a lack of approval of developments. The States have been indolent, and the Commonwealth have not used all the levers that we could use to ensure that we are building houses, particularly in Sydney. Obviously, I'm concerned about all the people who live in this country, but Sydney is where it's most acute. So many of these roads lead to supply. And so what we need to do as a Federal Coalition is to find some creative ways to incentivise all the other parts of the ecosystem to build these houses.

John Stanley

So a lot of your colleagues call themselves 'Yes in My Backyards'. You've talked about NIMBYism. Are you joining them in supporting that notion that we need to get more housing into the areas close to public transport hubs, really mimicking what the Minns Government wants to do.

Senator Bragg

Yeah, we have to build more houses across the board. There's no doubt about that. As you say, there's no way you can solve this. I mean, only a snake oil salesman would say you could solve this with demand-side solutions or cutting immigration to zero, for example. I mean, there's obviously a debate to be had about all these other factors, but the reality is we need the private economy to build these houses. We don't believe that a government property developer is the way to go. And we're not enthusiastic about the super funds owning all the houses and then renting them back to us like we're serfs. So as I say, Labor have an approach which is led by their mates at the super funds and the unions. The Greens have an approach which is led by a big public sector approach. Our approach is that we believe that the market is best served to build the houses.

John Stanley

Let me get to the policy at the last election, which I assume is now under review, but that policy was only wheeled out in the last week of the last election. And people who've contacted me said, well, it's about raiding your super and losing your super for the future. But my understanding of the policy was that you would be able to take money out of your super, you then put it into the family home, which is probably the most effective tax shelter, more effective than super, but that ultimately that money would then return into your super down the track once it's helped you buy a first home. That's the way I understood the policy. It came very late.

Senator Bragg

Well, look, John, this is one of the most irritating debates in Australia. The idea that super is the only way you can have a good retirement. I don't buy into this paternalism. I think that Australians have been able to set themselves up for retirement in a whole lot of different ways before Paul Keating came along and locked up a whole lot of our money in these funds, which make huge payments to financial institutions and unions. Look, the key determinant of your success in retirement, financial success at least, is your home ownership status, not the size of your super balance. So yes, the answer to your question is that is our policy. Our policy was you could take up to $50,000 bucks of your super out. That is still our policy, and we're currently looking at expanding that policy. And tomorrow, in fact, I'm chairing an inquiry which is looking at how that policy could be expanded.

John Stanley

Because I'm right aren't I? I know, look I'm sure your view, based on what you've said in the past, is you'd like to see people just have access to their super to put in the house. But the policy was that the money, once the house was sold, would go back into super, which addressed the question of whether you were raiding your super into in the future, didn't it?

Senator Bragg

Well, that's right. And that was effectively trying to deal with that perception, which I don't think is…

John Stanley

I know you don't agree with it, but that was the policy, wasn't it?

Senator Bragg

That is the policy we have at the moment. And the question is, can we expand that? I am on the record previously saying it should be expanded, it could be expanded to have a bigger deposit, for example. You could take more of your super out or you could use your super as an offset as well. So I think we need to have policies that work for people who want to pull together a deposit. I understand in Sydney, that's very hard. If you're looking at an average deposit of more than $150k. For many millennials, their super is going to be their best bet unless they've got access to the bank of mum and dad. And we don't want to build our policies around people having access to mum and dad's money. We want to have a society where anyone can get a house. I think that's a really important principle.

John Stanley

Yeah. And look, the policy wasn't, correct me, because it came out late, and I think you probably all acknowledge that the policy might have been better coming a little earlier than it was, but it was $50,000. So if it's a couple, it could be $100,000. Is that right?

Senator Bragg

If you can combine it, yeah, that's right, I think. But you need to, effectively...

John Stanley

And it is being reviewed now, too, isn't it?

Senator Bragg

Look, it's a starting point. That is still our policy, but it is a starting point, in my view, because I think there are things you can do with super to help with deposits, but there's also some things you do with super to help people reduce the costs of their overall debt. Now, there are more and more people retiring or getting to preservation age, which is 60 with their super, which is then being used to pay off a mortgage. And you've got to ask yourself, what was the point of that? Why are we making people pay all this interest to banks?

John Stanley

Yep

Senator Bragg

They've got their own money parked in a super fund. So I think it's a very inflexible system, John, and I think it could be deployed to help on the housing question. But as I say, it's not a silver bullet here, supply is a really important part of this.

John Stanley

Yeah. And look, the interesting point you say here with Adam - sends me on the text line here - I'd love to knock some of the loan off, as you're saying, I don't know what age that person is, but they might be, so they're in their 50s or their 40s, well, eventually, when they get to, say, 60 or they can access their super from 60, depending on their circumstances, as you're saying, they take the money out and pay the loan off then. So you're saying, well, why not do it earlier and not pay all that interest?

Senator Bragg

Exactly. So if you've got a mortgage of a million dollars and you've got a hundred thousand bucks in your super, I don't know why you wouldn't be able to use it, given that we all know that your high ownership status, as I say, is a key driver. And ultimately, the tax and social security systems are calibrated to support home ownership. So I think that is the most urgent task before us.

John Stanley

Adam says he's 36. So he's someone who's not going to access that super for a very long time, but he's got some there, which he'd like to take off his mortgage, which is the point you're making. I know you've only got a few minutes here. I've got a person here asking, what do we define as an affordable house? A lot of people are talking about that. We talk about affordable housing. How do we define that?

Senator Bragg

Well, it depends which city you're living in to start with. Everything in Sydney is vastly more expensive. But if you're looking at an average deposit of $150k in Sydney, that's out of reach for many Australians. And so there's, of course, going to be a conversation in the housing policy about how we can provide housing for community housing purposes, people who are firees and police, nurses, for example. That's also going to be a part of it. But I'm loath to put a figure on it, John, because I think it really does differ depending on where you're living in Australia.

John Stanley

Two quick ones, and I know you got to go - Stamp duty. The Perrottet Government started the unwinding of stamp duty, which was very popular, and a lot of young people that work in here actually took advantage of it to get into their first home. That's been unwound now by the Minns Government. I know it's a State Government issue, but do you like that one?

Senator Bragg

Yeah, I did like that policy. And I think anything we can do to reduce taxation on housing is going to help. The idea that you cut back negative gearing, I think, is not going to be an effective policy. I mean, anything to increase the tax burden will result in fewer houses because, of course, as we've just discussed, there's a major issue here with supply. So If you want less of something, you increase tax. We're not going to be doing that.

John Stanley

All right. You're going to talk about supply. When you've pulled together something a little more concrete, I'd love to hear your thoughts. And also, you wouldn't be surprised, I have had line after line after line from people who are saying, immigration, you need to have a look at that. And you didn't say immigration has no effect. You were talking about cutting immigration to zero. So that is part of the conversation. Is it, the numbers coming in?

Senator Bragg

Yeah, definitely. I think if you reduce immigration, will make this problem easier to solve. But as I say, if you cut it to zero tomorrow, you still got a huge problem. We have to be honest with people about the scale of the problem. And as I say, my view is you can't solve a problem without building a lot of houses.

John Stanley

Yeah, exactly. And doing it as quickly as possible. I appreciate your time tonight. I know you got that meeting tomorrow. The super policy does sound to me like it's one that's going to appeal to a lot of young people, and I think you agree with that, too. So let's talk when you've firmed that policy up and you've made the announcement. I thank you for your time tonight.

Senator Bragg

Glad to, John.

John Stanley

Thanks a lot. Cheers. Andrew Bragg, who's a Liberal Senator there.

[Ends]