Television Interview with Tom Connell – Sky News – Thursday 15 October 2020


SUBJECTS: HomeBuilder; Social Housing.

TOM CONNELL, HOST: As you heard earlier, the Government is touting its HomeBuilder Scheme, that is one aim to get first homebuyers into the market and also generate plenty of action within the construction industry, as a success. Joining me now from the Labor side of things, the Shadow Housing and Homelessness Minister, Jason Clare. Thanks very much for your time.

CONNELL: So, the figures, more than 11,000 applications. We know there’s a delay from when you have the application when actually things get underway but it’s certainly popular, the scheme.
CLARE: It’s still rolling out too slowly. We’re almost five months in now, we’ve only got 11,000 applications in, barely two and a half months to go and the Government’s hoping it gets up to that 27,000 number. I hope it does, but it really does, it need to speed up if it’s going to hit that number by the end of this year.
CONNELL: Well, it needs to speed up, I guess that’s people. The states are looking at things such as if you extend the time from when you first sign the contract to when you pour the concrete if you like, that window goes out to six months, they think that could really speed things up. So that little tweak, do you think that could be the difference between this being something that’s under-subscribed and over-subscribed?
CLARE: That tweak would definitely help. I think they need to extend the deadline for applications generally. Let me give you a good example of why: you’ve got about 3,000 Aussie families around the country that had their homes burned down over the summer. Most of them are telling me that they’re not going to be able to put an application in by New Year’s Eve to get the $25,000 grant to go towards rebuilding their home. And that’s because of problems with insurance and planning approvals, and just the trauma that they’re still dealing with. I think most people would say if there’s anyone in Australia that deserves 25 grand to build a new home, it’s people who had their home incinerated over Christmas. There’s a good reason to extend it, you’ve got all the housing organisations: The Property Council, the Master Builders Association, the HIA, all saying the scheme is going to need to be extended, plus, on top of that, you’re going to need to do other things to help keep the housing construction industry going, including things like building and repairing social housing.
CONNELL: And I know that’s part of Labor’s policy. Look with what we’ve got in place with what the Government has, and even adding in Labor’s Scheme as well, is there a cliff coming? I mean, the HomeBuilder Scheme is pulling forward demand, that’s in the Government’s own words. Net migration is going to go backwards, we’re talking about hundreds of thousands of fewer homes being built the next few years. Is it inevitable construction, this industry, will shrink?
CLARE: The big problem with the scheme is it’s too small. You’re right, all of the forecasts, whether it’s from Treasury or whether it’s from the housing industry, show this cliff’s coming. Last year we built about 170,000 homes, this year it’s predicted that we’ll build as few as 125,000 homes and the drop will hit most sharply in September of next year. If that happens, then you’re going to have thousands and thousands of tradies and people who work in the manufacturing industries that produce everything from the bricks, to the tiles, to the plaster board, losing their jobs. That’s why the industry is saying that this is not enough and that more needs to be done. You mentioned migration Tom and you’re dead right. There’s no migration at the moment, we’re not expecting those numbers to get back to where they were last year for another four or five years and that’s one of the big reasons why there’s been a suppression in private demand for housing. Less migration or no migration means not as many people want to buy a home or want to build a new home. Now, when there’s a suppression in private demand, you can either let the housing industry atrophy and shrink, or you can replace that by government building social housing. That’s just one of the ways to make sure that the industry keeps going, that we keep supporting the jobs of all the people who work in this industry, almost a million people. And I got to tell you, Tom, this is an industry that has a massive multiplier effect. $1 in creates $3 in the economy. If we want the economy to bounce back quickly and get out of recession, then it’s in all our interests, for this industry to keep going. And I got to tell you there’s no oversupply of social housing out there. We need more of it.
CONNELL: And I understand that but if you look at the size of the industry, you spoke about, the number of workers and Labor’s alternative in the Budget, $500 million for social housing, it might help but that’s a long way short of finding employment for the rest of the industry. Is this just your first offer? Would they have to be a lot more coming to actually let’s say (interrupted)
CLARE: That’s the first thing you need.
CONNELL: … in an industry of this size?
CLARE: Fair enough, Tom. That’s the first thing you need to do. It’s what you could do fast. If you were to put half a billion dollars into the repair of social housing, you could get that work going almost immediately. There’s about 100,000 places right across the country full of mould and leaks and rot, basic repairs there would create jobs for tradies in the same industry where work is running out. That’s what I was saying, if you want to do something quick, make sure that people don’t run out of work in the next few months, that’s where you start. But I think state governments also realise that in addition to repairing social housing, if you’re building more social housing in the years to come, you can help to fill that gap and keep the industry going at a pace like they were last year.
CONNELL: So, do you think you can avoid entirely this cliff, except that’s my description rather than other people’s, with just social housing?
CLARE: You need a comprehensive plan. We said it a couple of months ago, there’s a whole bunch of things you need to do: incentives for first time buyers, make it easier for first time buyers to get a loan by uncapping the First Home Loan Deposit Scheme, the Government’s gone some way towards doing that, working with super schemes to help build more affordable housing, and building more social housing and repairing social housing. And this is the way to do it. I saw the Minister on your program last Friday and he was saying that putting money into repairing social housing is not going to work, the states won’t to put money in, it won’t create any more jobs, it’ll take 12 months. And then the next day on the front page of The Sydney Morning Herald, you’ve got “Perrottet’s Cash Splash for Social Housing”. The New South Wales Liberal Government saying they’re going to put hundreds of millions of dollars into the Budget coming up in a few weeks for social housing, because they say that it will help to create jobs. So, it just torpedoed the stupid argument from the Government that we shouldn’t be doing this. Of course, you do these things in a recession because it helps to keep tradies working.
CONNELL: Just finally, we know Labor’s previous policies within tax concessions for investment property. Given this huge uncertainty hitting the industry, presumably now would not be the time to go to another election with that policy and that would just seem crazy.
CLARE: Well Tom, I’ve said a million times we’re not going to take the same policy to the next election we took to the last one. We’ll announce what our policy is closer to the election.
CONNELL: We’ve already got a prospect of empty rental properties and you know, what might happen if you get more people into their own homes. That’s great. Any sort of increased tax on housing just seems crazy right now, doesn’t it?
CLARE: We’ve definitely got to do more to make it easier for people to buy their first home. The fact is the proportion of Aussies who own a home today is at its lowest level since Menzies was Prime Minister. So, the focus that we have to have right now and in the longer term is what do we do to make it easier for people to buy their first home. The government’s done some things but I still think there’s more things we need to do. But I’ve got to tell you, I’m not focused on the next election. I’m focused on the next few months trying to keep this industry going, trying to make sure we avoid the bloodbath the Master Builders Association is talking about, but also in addition to housing construction, and helping people buy a home, there’s a bunch of people out there that are struggling to pay the rent at the moment. It’s getting harder and harder and with unemployment predicted to go up and support going down I think it’s going to get harder for more Australians in the next six months to pay the rent. There’s a report out today Tom proving that there’s more and more people that are struggling to pay their rent at the moment.
CONNELL: Jason Clare, appreciate your time.
CLARE: Good on you. Thanks, Tom.