MATTERS OF PUBLIC IMPORTANCE

Senator DOWLING (Tasmania) (17:34): Senator Bragg's proposition today asks us to believe that Australia's housing crisis somehow began with the last Labor budget. The numbers tell a very different story. Since 1999, Australian house prices have risen by more than 400 per cent.

I hear those opposite stressing about a few per centage points. There was a 400 per cent increase; that's the context we're working in. That increase was more than twice as fast as the growth of average full-time earnings.

You've had a 400 per cent growth in house prices, and full-time wages have only grown by half that. Median house prices are now eight times average full-time earnings, and it takes an average of 11.2 years to save a standard deposit for a house. This crisis was decades in the making.

Suddenly, we see some affordability coming into the market and those opposite think that's the time to call a crisis. The crisis was decades in the making and now we're doing something about it. No serious person should pretend one government created these challenges in our housing market, but, equally, nobody should pretend it suddenly appeared in May.

For the coalition's first six years in government, they didn't even have a federal housing minister. When the coalition eventually decided it had an answer to declining homeownership, one of its signature ideas was to let young Australians raid their superannuation to buy a home. Senator Bragg has been one of the idea's strongest advocates.

At the National Press Club just last month he reminded us the coalition took super for housing policies to the last two elections, and only weeks ago he confirmed that the relationship between super and housing was again part of a policy review. Let's just think about the economics of that for a moment. If you have too few homes and you give every prospective buyer more money to bid for them, you haven't created another home.

In a supply constrained market, some of that additional purchasing power simply gets capitalised into higher prices. The buyer arrives at the auction with more money and so does everyone else, and they arrive with less superannuation at the same time. Housing affordability ultimately requires more housing and that means land, planning, tradies, finance, as well as the roads, water, power and sewerage that turn developable land into actual homes.

Here's where today's motion becomes particularly interesting. Less than two weeks ago, Senator Bragg said, 'A housing target is meaningless if the connecting roads are not built, the sewer is not hooked up and the water does not reach the block.' On that point, Senator Bragg is right. Senator Bragg, welcome to Labor's housing policy, because the budget he is attacking includes specifically another $2 billion for exactly that enabling infrastructure, taking our investment to $6.3 billion and supporting up to 65,000 additional homes.

In Tasmania, you can see what that means. At South Brighton, just outside of Hobart, more than $10 million in Commonwealth funding is delivering sewerage, roads and connections needed to unlock up to 600 homes. Our agreement with Tasmania will unlock 4,000 more homes with up to 2,100 reserved exclusively for first homebuyers, At Dowsing Point, surplus Commonwealth land has the potential to deliver another thousand homes for greater Hobart.

That is supply policy. That is why the design of our tax reforms matter. We are not removing negative gearing from new housing; we are preserving it for new builds.

Existing investments are grandfathered and new housing receives preferential treatment under the capital gains tax reforms as well. The economic signal here is straightforward: if taxpayers are going to subsidise property investment, let's give investors a reason to add another home to the market. You can argue about the calibration of that policy, but to claim it is designed to produce fewer homes ignores how the policy actually works.

And the latest evidence actually supports the claim. If we look at the ABS figures, they show that dwelling approvals are in fact nine per cent higher than a year ago, and the underlying trend is up almost 12 per cent. In Tasmania, approvals rose 15 per cent in July alone.

Does that mean the housing crisis is solved? Of course not. We need more supply, faster approvals, greater construction productivity and more skilled workers.

That is precisely why this government is funding infrastructure, releasing land, training tradies, cutting red tape, building social and affordable housing, and reforming tax incentives. Australia needs more homes. On that much, Senator Bragg and I agree.

The difference is that we're getting on with actually building them.