Radio Interview with Steve Chase – ABC Newsradio – Monday 25 May 2020

MONDAY, 25 MAY 2020

SUBJECTS: National Housing Stimulus Plan 

STEVE CHASE:  The call for stimulus measures from all levels of government to encourage new housing construction appears to be growing. New Economic modelling commissioned by the Master Builders Association, estimates that a $13.2 billion injection into building and construction would stimulate over $30 billion in new economic activity and create more than 100,000 new jobs across Australia. The modelling has been published as the debate continues over whether the Federal Government should redirect assistance in the wake of a Treasury error which radically scaled down the cost of the Government’s JobKeeper Programme.

Jason Clare is the Shadow Housing Minister and he joins us now. Jason Clare thanks for being with us.


CHASE:  Now the Prime Minister, as you know, has indicated assistance for the building industry is needed and he’s due to address the National Press Club tomorrow. If he does announce these measures then, is that something Labor would welcome?

CLARE:  We’ve been calling for action for over a month now, for help for tradies who work in the construction of Australian houses. There’s about a million Aussie’s who work in the housing construction industry, from carpenters, to electricians, to plumbers, through to all those small businesses that produce the products that help to make a house. So if the Government finally acts here and does something to help keep those Aussies working, then that’s a good thing. The Prime Minister has got an opportunity to say something about that and do something about that tomorrow.

CHASE:  So the question arises, doesn’t it, where do you get these funds? Do you bring forward budget expenditure or redirect those funds now not being earmarked for JobKeeper as a result of the Treasury error?

CLARE:  The Government’s got a choice here. They can either pay tradies the dole or they can invest money into the housing sector to keep those tradies working. That’s why a couple of weeks ago Albo and I said that they should use stimulus funding to build public housing and to renovate existing public housing. That’ll help keep traders working, and also provide us with more of the housing that people who need it really need. Or they could also invest in the construction of more affordable housing for some of the people who’ve been on the front-line of this COVID crisis.

Let me give you an example, Steve. We all recognise, I think now, the importance of nurses, of cleaners, bus drivers, people who don’t earn a lot of money, but often have to travel very long distances to get to work. They can’t work from home behind a computer and a lot of them have to live a long way away from expensive parts of town where they work. I’ve said that with a housing construction crisis, like the one we’re facing now, it makes sense for us to keep tradies working by building more affordable rental accommodation for the heroes of this crisis. They do it overseas, we don’t do it well enough here in Australia.

CHASE: Well, that’s all very well, but can I get back to the question about the source of the funds, because it is important, because the Government would argue that if you were to redirect the money that was going to be earmarked for JobKeeper they’re borrowed funds. Now the budget is not until October, so would you be of the mind to redirect borrowed money or money that was going to be spent or would be spent in the budget? 

CLARE: They can’t wait for the budget. That’s a fact. People will be losing their jobs in the housing sector by then.

CHASE: No by bringing forward the budget expenditure, I’m saying.

CLARE: They haven’t allocated any money in the budget to help these tradies so far. So if nothing happens, they’ll be people that are unemployed by October and JobKeeper is expected to end in September, when a lot of these tradies are expected to lose their jobs. Now, the Government needs to either think about changes to the way JobKeeper operates, or even better, provide incentives for people to build more homes, and with the state governments, and superannuation funds, and the private sector, invest more money into the building of social housing and affordable housing that’ll help keep these tradies working and make sure that we’ve got more of the housing that we need into the future.

CHASE: So Labor’s preferred method is to bring forward budget expenditure or use the money that was would have been used for JobKeeper.

CLARE: Steve, I’m not telling the Government how to do this. I’m telling the Government there’s a problem here. So is the Master Builders Association. So is the Housing Industry Association. So is the Property Council. So have a lot of economists and unions. They’re saying this is a problem, tradies are going to be out of work and a lot of small businesses are going to hit the wall here, find a way, develop a plan to make sure that we keep these businesses alive and that we keep tradies working. All we’ve heard from the Government on this is crickets over the last few weeks. Tomorrow’s an opportunity for the Prime Minister to finally do something about this.

CHASE: Let’s go back to this economic modelling because there’s some very big numbers involved aren’t there? There’s estimates that if there was an injection of $13.2 billion into building and construction it would create some 100,000 new jobs and stimulate over $30 billion in new economic activity. You would think on the basis of that the Government would be inclined to invest in this area because, by these figures, it’s a pretty good return on investment.

CLARE: I hope that they take some action here. As I said a moment ago, this is not a small industry, you’ve got one million Aussies that work in the home building industry. If the forecasts are right, and the forecast is that instead of 160,000 homes being built this year, it could be as low as 100,000 homes, then that means that a lot of tradies lose their jobs. This forecast says it’s in the hundreds of thousands, that’s a terrifying figure. That’s more and more people on the dole queue who have never seen the dole queue in their life before.

In the Global Financial Crisis, when that  hit, we invested in building more social housing. It helped to keep tradies working, it built more housing and helped the economy to recover quicker. That’s just one way that the Government can tackle this issue today, but there are others. We need the Government to take issue seriously and help out Australia’s tradies.

CHASE: You’re the Shadow Housing Minister, where are the areas of need, around the country, as you see it?

CLARE: Where are the areas where there isn’t need Steve. As a Sydneysider, I know just how expensive it is to buy and how expensive it is to rent.

CHASE: No but you must have an idea of where the money should go generally speaking?

CLARE: The best way to do this would be the way that we did it during the Global Financial Crisis where you sit down with the states, and you get the states to put their hand in their pocket as well. This is something that you can do together. So it’s all state governments and the federal government working collaboratively together.

Just to give you one example, listeners may be surprised to hear the most unaffordable place for renters in Australia, at the moment, is Hobart in Tasmania, and then Adelaide in South Australia. So there are challenges right across the country. In a place like Sydney and in a place like Melbourne, these are places where a lot of front-line workers, the people I talked about before – key workers like nurses and cleaners and bus drivers and supermarket workers often have to live a long way away from where they work and building more affordable rental accommodation in places like Sydney and Melbourne, I think would really help.

CHASE:  You rightly point out that you need to bring the states in. You might even get back to the age old problem that by and large, you’d agree, that the state governments are responsible for housing in their own jurisdictions, but they have a reputation or have at least had a reputation over the years, of actually not being willing to release new land. So it’s all very well saying put all this money on the table if the land is not there one which to build things.

CLARE: You’ve got to work together. The Global Financial Crisis taught us one thing, and that is that federal governments and state governments can work together, get land available quickly, and build it. So we’ve seen this model work before, and it can work when state governments want to act, and find land and approve it for development quicker than would be the case for the private sector.

Remember Steve, if you go all the way back to World War Two and think of Curtain and Chifley thinking about reconstruction and recovery even in the teeth of the Second World War, one of the things that they focused on for recovery was building houses. It’s a good way to get the economy back up and running again. When we get forecasts like this that we see in the newspapers today that says hundreds of thousands of tradies will lose their job if the Government does nothing. Well, I think it’s incumbent upon all of us to take that seriously and come up with a plan to fix it.

CHASE: Finally, and quickly, we’ve mentioned the state government, the federal government, what about the private sector? Would you be averse to them being involved in any shape or form?

CLARE: No, I think they’ve got to be part of the solution as well. Government can contribute but we need the private sector to help. Superannuation funds in particular can be very helpful here. There are some some great examples already of superannuation funds in Sydney and in Melbourne building the sort of affordable accommodation for front-line workers that I’ve talked about before. They are interested in doing that to a greater extent than they’ve done so far, so I’d encourage them to be part of the solution as well.

CHASE: Jason Clare thanks for your time.

CLARE: Good on you. Thanks Steve.