COMMITTEES

Senator BRAGG (New South Wales) (18:42): I move: That the following matter be referred to the Economics References Committee for inquiry and report by 1 February 2027: The governance and performance of Housing Australia, with reference to: (a) the implementation of the following programs: (i) Housing Australia Future Fund, (ii) Affordable Housing Bond Aggregator, (iii) Nation Housing Infrastructure Facility, (iv) Nation Housing Accord Facility, (v) Home Guarantee Scheme, (vi) Capacity Building, and (vii) Help to Buy; (b) the administration and outcomes of its programs; (c) the make-up of the Board, including intersection with the Department of the Treasury and the existence of observers; (d) compliance with Senate orders, the Freedom of Information Act 1982, parliamentary oversight and transparency in general; (e) compliance with workplace standards and norms, including the compensation of senior executives, spending on consultants and hiring processes and decisions; and (f) any other related matters.

The whole point of spending taxpayer funds to come to Canberra is to make sure that public programs are properly administered and taxpayer funds are well spent. In the case of this Senate, conducting its house of review function, it is essential that we remember those two things. The reason we have put forward this reference tonight is that we believe that the housing programs of this government have not been well administered.

Regardless of the intention that may lie behind the almost $80 billion proposed expenditure on housing, it is very clear that a lot of these programs have not gone well. They've not gone well in terms of their performance, in terms of what was promised to the Australian people and in terms of the efficiency and the quality of the expenditure. We're proposing this motion again this evening for the Senate's consideration because we urge the Senate to do its job.

We urge the Senate to do its job and to make this reference, where we can properly get under the hood of this behemoth, Housing Australia, which is in the process of spending in different forms—guarantees, cash or whatever—80 billion bucks of taxpayer funds. That's what it's doing. It's a fire sale of taxpayer funds where it buys houses, gives guarantees to all sorts of different people and acts as a property developer and an insurer.

It's like a megalomaniac government agency, and it is beyond the scope of Senate estimates to do the deep analysis that we need to do to make sure that the public is getting reasonable value for money. I think it's good and reasonable that we all differ on the merits and the purposes of different public programs, but surely we all want good value for money. So the proposal before the Senate is that we do a deep inquiry into the functioning, governance, performance and transparency of this $80 billion behemoth.

I pay credit to Greens and other senators who have participated in the estimates hearings, where we have not been able to get the information that the Australian people would expect on how the programs have been administered. The main charge against this agency and against the government's program is that it is spending $80 billion to build fewer houses than the last government, so there is all this bureaucracy and we have fewer houses.

The second relates to the quality of the expenditure. It cost, before this fuel crisis, an average of about $500,000 to build a new home in Australia, but Housing Australia is spending up to $1.3 million per flat—per dwelling. Their priority, in some cases, has been to subsidise the returns of investors, AKA the best friends of the Labor Party, the super funds.

They're more focused on subsidising their returns than they are on actually getting cheap houses. Do you know what? We should have a country where people can build or buy a cheap house, and, if the government wants to build houses in some form, it should be looking for the cheapest possible approach so that it can maximise value for money, not look to subsidise friends.

The job of the government is not to look after mates; it is to do the best for all Australians whether they voted for it or voted against it. That is the job. So we need to analyse the maladministration of Housing Australia, which has meant that they haven't built many houses.

In fact, in some cases, they are buying houses. Minister Gallagher told a Senate estimates hearing that Housing Australia had bought almost 400 homes—homes that could have been bought by Australians. So the government's housing agency has done such a good job it's now buying houses that other people could actually have owned, thereby making a very restrained supply side even worse.

The spending quality, I think, is really going to be germane to this inquiry if the inquiry is endorsed by the Senate, because we need to understand why these availability payments are going to these investors to such a degree that it's costing millions of dollars per dwelling, more than double the average cost of a new build. That is a great question. That is a question that we should all be asking ourselves—whether we think this is a good model or not.

For the record, we do not think this is a good model. The government won the election. This is their model.

They deserve the right to progress their model, and we deserve, on behalf of the Australian people, to scrutinise the way that they are spending taxpayer funds. The second issue is the governance. The Labor Party have established this organisation with a board, some of whom are probably Labor Party friends.

Some of them used to be politicians in the Labor Party. The board seems to be beset with problems. There have been two reviews into the board; one by Deloitte and one by Assemble.

The chair has had to step down recently. The board has been so ineffective, it seems, that the minister, Clare O'Neil, has had to appoint an observer, a Treasury official, who turns up at the board meetings. So you walk into the Housing Australia boardroom.

You've got the plastic plant in the corner and probably a couple of windows to the outside that don't open. Then you've got the Treasury guy sitting in the boardroom on behalf of the minister, and the Treasury guy sits through the meetings where they're talking about the funding of all these programs, which is a howling conflict of interest. The board is deciding who to give money to.

In round 1 of the HAFF tender, guess who the biggest beneficiaries were. The super funds. The super funds were the biggest beneficiaries through their charities that they'd set up, so the conflicts of interest here are very significant.

The Senate should consider the way that the composition of the board has been created. It should consider whether there are the right conflict-of-interest policies in place and whether it is the right thing for a Treasury person to be sitting in a board meeting for Housing Australia, which is dispensing billions and billions of dollars. According to testimony at Senate estimates, the Treasury observer does not recuse themselves from any discussions it seems.

So this is a great question of governance. Then we have I think quite a reasonable question, which is why are there executives at Housing Australia who are being paid more than half a million dollars? They're not even running the show and they're being paid more than half a million dollars.

The turnover at Housing Australia in the last year has been more than 25 per cent. There have been numerous WorkCover claims. There have been numerous bullying problems.

There's been a taxpayer funded probe into the integrity of the board. I mean, this is a very sick organisation. So for the Senate to vote down the proposal to do a deep dive, a proper review, into this agency would be a grave misstep.

In terms of this Deloitte report, it has flagged a number of things which I would say are eye-opening. It does say that Housing Australia does not have a consolidated or group risk register. When I was an internal auditor, the first thing to look at would be the risk register, and even a small organisation would say, 'We've got a personnel risk, financial risk and operational risk.' Housing Australia is spending 80 billion bucks and hasn't got a risk register, so that's good!

It's going well down there! Then Deloitte have identified lack of value of money. They say that there's a lack of a standardised process or template relating to value for money, which has created a risk.

The value may not be effectively established or documented. This means that Housing Australia can spend money in any which way it desires. It can do whatever it wants.

It can build these contracts in a way which puts the investors before the taxpayer, and that's what it has indeed been doing. Then we have the procurement issues, which have also been flagged by Deloitte. They've said that it is also severely lacking.

At the end of the day, an independent report has identified these problems. It's unclear how many of these changes have been addressed. The other governance report, which was done by Intersection, looked into the board of Housing Australia.

Even the name of the report was redacted by the government, which has not been forthcoming in providing any responses to what Intersection recommended in terms of board governance. So I think there are significant issues at the board level which do warrant further investigation. We have tried to get to the bottom of the maladministration of the programs.

We've asked questions in the Senate, and we've ordered the production of documents in relation to the five per cent deposit scheme, which has been a disaster for younger people, who are now facing vastly higher property prices than they should've been because of the risky opening up of this scheme to any Australian without any means testing at all. In the orders for the production of documents, we have sought to get access to the income deciles of the people that are actually using this scheme since the government removed means testing.

We suspect that there are people of very significant means who are now using this government program, this free insurance scheme, but we have not been able to get the information from Housing Australia. Similarly, the order for the production of documents in relation to the staff survey has not been provided by the minister. There are quite simply a range of questions that have not been answered about why the dysfunction has existed from a governance point of view.

There are a range of questions in terms of performance of the agency and why it has been so sick. There is a great question about its obfuscation and its seeming obsession with secrecy. We don't seem to be able to get information from the government in relation to Housing Australia and from Housing Australia itself, which raises real questions.

I would be happy if we had a Senate estimates program which allowed us to do the deep consideration of these matters—about how money is spent. For example, Senator Pocock, in the past, has asked about the consultants: 'How many consultant are used? How much money has been spent on consultants?' But the estimates schedule is such that it is very hard to get to the bottom of things.

Given that we don't have that, this is the extent we have gone to, to try and get basic information about the housing portfolio and about Housing Australia, through the Senate chamber and through FOI. The Treasury department has been exposed—maybe at the direction of the executive; I'm not sure—as having used the wrong FOI exemptions when they have exempted documents and used redactions.

For example, in relation to the five per cent modelling, they have said that the supply issues in that modelling are irrelevant. Now, in the housing system, you don't have to be very smart to know that there is a supply side and a demand side, and, if you want to know the price impact of something, you have to look at both elements. I think this has been a period of huge obfuscation.

The Centre for Public Integrity has said that this is the most secretive government since the Keating government, and there is no question that anyone who was independent, looking at this government, would say that it is a very secretive government. The fact there are these blurry lines between Minister Clare O'Neil's department, the Treasury department, and Housing Australia itself, raises the questions of integrity, governance and probity.

That is why I think that, when it comes down to these two factors—firstly, that we don't have a Senate estimates program which allows us to do the proper examination that we are paid to do of this behemoth of an organisation; and, secondly, that there are issues of conflicts of interest, in between the minister, vested interests, the Treasury itself and the Housing Australia board and its executive—we have not been able to properly examine those through that process.

So I urge the Senate—and I particularly urge the crossbench, because we know the government will, of course, vote against any attempts at having a reasonable scrutiny process—to now vote for this motion, and, when it comes up, for a division, because this is going to be our only chance to run the ruler over this huge public expense. Who would have believed that we would live in a country where the Commonwealth government would become a property developer and an insurer and God knows what else.

We have no idea what's going on down there. They are spending a lot of money. They're doing a lot of weird stuff.

We need to get to the bottom of this. I would say to the Senate: voting down this inquiry, if that were to be the outcome, would be a very dangerous precedent, because we would be effectively saying that we're not being flown here to the bush capital to do the work of the people but just to sit here playing tiddlywinks—playing a few games. This is the real, hard work of scrutinising.

And that's what the taxpayers want. They're paying a lot of taxes in this country. This is a high-tax country, and people expect that, for every last cent they contribute, they're going to get good value.

They want to get all the juice out of the orange. The risk, with this Housing Australia, is that it's not an orange; it's a real lemon. And, until we can properly have this inquiry, we won't be able to see how we can fix it.

We want to be constructive, but, until we do that inquiry, I fear that we won't really know the true state of affairs—other than we can tell it's crooked. We really need to nail down the detail of how it's crooked and how we can fix it.