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Speech on the housing crisis and the power of the big banks

On Monday 12 February 2024, I made a speech in Federal Parliament about the housing crisis and the power the big banks hold over the major parties. You can watch the full speech here or read the transcript below.


Even the Productivity Commission thinks the Help to Buy Scheme is a bad idea, and this makes sense when you think about it. Of course, if you make it easy for some through, essentially, a lottery, it makes it harder for everyone else. If you're standing at an auction and the person next to you has access to this scheme and you don't, there is simply no way you're going to be able to outbid them—unless you're a property investor and have access to a whole range of tax concessions, of course, as I've already mentioned.

Here's a radical idea: what if we took the money we put into tax concessions for property investors and actually built some public housing? Actually, clearly, that's not radical. It's just common sense. Building public housing is something that even Australian governments used to do on a mass scale. Even under conservatives like Menzies, the federal government was building tens of thousands of dwellings a year. That's been whittled away over decades. Now the government barely builds any new public housing at all, and in many states numbers are going backwards as older housing units are privatised or demolished.

Of course, there's a reason for all of this. The money is there. Just with savings from scrapping tax concessions for property investors, we could build half a million homes over the next decade, for instance. But Labor and LNP governments just don't want to build public housing. They prefer to leave that job to the private market. Could this be because they are completely beholden to their donors the big banks and the property developers, who, of course, support endless exponential growth in house prices? It keeps earning them enormous profits.

The big banks and property developers support endless exponential growth in house prices. It keeps earning them enormous profits. Building public housing to actually house the Australians who desperately need it would eat into bank profits. Apparently, we can't have that, can we! Let's talk about those big banks and property developers.

All of Australia's big banks donate to both political parties—over $5 million to Labor and $6 million to LNP in the last decade. Labor and the LNP seem to be on a unity ticket to protect the interests of bankers—which, as I said, actually ensures house prices keep going up and up—by refusing to tax their enormous profits. They even protect some bankers who rip off customers from the appropriate legal consequences, like fines and prison times. Particularly for Labor, there are some familiar faces. I would use the word 'culprits'. Former Queensland Labor Premier Anna Bligh is the head of the banking lobby. I'm not sure if there's a more stark illustration of the way power actually works in this country.

What do the banks get for their donations and connections? Absolutely mind-blowingly enormous profits earnt off the backs of ordinary Australians. We've just heard this morning Matt Comyn, Managing Director of the Commonwealth Bank, boasting about their half-yearly profit of $5 billion. That's a half year, not even a full year. Nobody disputes that these massive profits are, in large part, due to rising interest rates. Mortgage holders and renters are struggling with their bills, struggling to put food on the table and struggling to afford the dentist because of high interest rates. Those ridiculous bank profits are directly proportional to the suffering caused by rising interest rates and the cost-of-living crisis, and they go completely unchallenged by this government and the political establishment.

The government is essentially pulling a bait and switch on everyday people. They're giving peanuts to potential first home buyers, who've been shut out of the housing market due to skyrocketing interest rates, the soaring cost of living and wealthy investors artificially driving up property prices. But this government congratulates itself and pats itself on the back for this unconscionably bad policy that will ultimately make an already desperate housing crisis actually worse. Wealthy property investors flourish under this protection racket of negative gearing and capital gains tax breaks, while regular people bear the brunt of rising interest rates. In Queensland, nearly 40 per cent of property lending goes to investors, while first home buyers struggle to secure a measly 16 per cent. It's a similar story in New South Wales and Victoria. Investors get the lion's share of loans, larger amounts and tax breaks to offset their costs. And what do first home buyers get? They're left grappling with 13 consecutive interest rate hikes, soaring rates and no relief from the escalating cost of living.

We are witnessing the lowest rates of homeownership in 70 years, and, instead of looking after people trying to purchase a home for their family, the government is doling out favours to wealthy investors, fuelling the housing crisis.

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