3 July 2017
Transcript - #20170131, 2017

Doorstop interview, Sydney

Subjects: Housing market; Labor’s proposal to smash the housing market and drive up rents; 10,000 young Australians get on the right PaTH program; House prices; Turnbull Government’s strong record of achievement

TREASURER:

It’s great to be here in Sydney today after visits last week to Perth and to Darwin, and to raise the many issues that were there. It’s now been one year since the last election, as the Prime Minister has been noting, there have been many achievements we have been able to deliver for the Australian people over these last 12 months. I particularly want to commend Minister Cash for the announcement today, 10,000 young people going into the Youth Path program, a key measure that was announced in the 16-17 budget and to see that following on now and the work that's been done there is terribly exciting. Today I particularly want to comment on the RP Data results in the housing sector. What this new data shows is that the Government's response to what have been pretty hot markets here in Sydney and Melbourne, while at the same time taking a national perspective and understanding that in other parts of the country, like where I was just last week in Darwin and in Perth or down in Adelaide or in Hobart or in Brisbane or in North Queensland, that markets can be very different. You need to take a very measured approach. You need to use the scalpel, not Labor's chainsaw of where they want to abolish negative gearing. What we have seen in today's data is we’ve seen that our measures, our prudent measures, are ensuring that we get to a safe landing in the housing markets in Sydney and Melbourne, avoiding the crashlanding, the hard landing, that would result from the more aggressive policies and the more ill-thought through policies that we saw at the Labor Party at the last election, which they cling on to today. The numbers we have seen today have seen a softening, an easing in the markets in Sydney and in Melbourne and at the same time a glimmer of hope in markets like Perth, which have been doing it pretty tough for some time. We welcome those movements. We also saw data at the end of last week where we saw the pendulum swinging back in favour of owner-occupiers. We saw an improvement in owner-occupiers getting into the market and we have also seen bank rates on mortgages for principal and interest falling five, six basis points in recognition of the policies and changes that we have been supporting through the regulator.

So what this shows is a Government that is alive to the concerns that are out there for Australians in our housing markets. We are alive to the challenges being faced by those who are looking for affordable rental accommodation with the measures we outlined in the budget and we are getting on with the job of now delivering. We are alive to the challenges faced by first homebuyers. That is why we have the tax cut for first home buyers savings that takes effect and can commence now. We look forward to that getting the support of the Parliament when we come back in August. So these are important measures that are focusing on the issues that Australians are focused on - the cost of their housing, the cost of their rent, the cost of power. These are the things that have the entire focus of the Australian Government.

Lastly, just let me say this, over the last year we have seen some 230,000-odd Australians go out there and get jobs. We have seen 50,000 people get full-time jobs just in May alone. Jobs are so important to the security of every Australian and we commend those businesses that are providing those jobs and that is why we are so excited to see the announcement today with the Retailers Association of 10,000 places they will be facilitating to get young people off welfare and into work. That is the way forward the Turnbull Government is showing.

QUESTION:

Treasurer, just on property prices, they have been prediction in the last couple of weeks that we could see very large rate rise increases over the next few years and that this could put a lot people under significant stress and see a crash. Are you concerned that in some ways people are too heavily mortgaged in Australia?

TREASURER:

One of the reasons that the regulator APRA took the decision it did to put the brakes on interest-only lending was that we were seeing household debt rising in this country. So, to get the balance back in favour of principal and interest borrowings, so people were paying down their debt, not just paying the interest, I think was a very wise move from the regulators, fully supported by the Government. Now we are seeing the outcomes of that now, that very careful approach that we have been encouraging and supporting now having this impact in the markets in Sydney and in Melbourne where things are easing off but to a safe landing, not the hard landing that Labor's policies would deliver.

QUESTION:

So Treasurer are you saying that you are comfortable with the way the market is treating house prices at the moment [inaudible].

TREASURER:

I think what we are seeing in the data on housing is an endorsement of the careful approach the Government has been taking. These markets can be volatile but the alternative was to take the tax sledgehammer out on the market and that would have driven the market towards a hard landing and we know what that would mean for the consumer confidence in the economy more broadly. So taking the more careful, measured and sober approach to this, using the flexible policies that we have available to us through the regulator, I think is providing that very calm and considered way to deal with what is a very real issue for so many Australians. I'm encouraged by the fact that we are seeing more owner occupiers, first home buyers coming back to the market. We want to see that happen. That is why we have the First Home Super Saver Scheme owners initiative in the Budget and we look forward to that being taken up by many Australians who want to accelerate their savings to realise their dream of owning their first home.

QUESTION:

Treasurer, just on another topic if I could. Michael Kroger said this morning that the Liberal Party needs to work together to win the election. Do you feel that the behaviour of some of the conservatives, like Tony Abbott has been too out of line and too vocal and what would you like to see?

TREASURER:

I agree with Michael and that is why we will continue to work together. The Sharks beat Roosters 44-12 on the weekend, great game up there in Gosford. It shows what you can do when you hold onto the ball, have your completions, 19 completions in the first half. Outstanding result. Flanno really was able to get the boys focusing on what was happening in front of them and it is no different for a Government. That is exactly what we are doing, the leadership our Prime Minister is showing. He is not distracted. We are not distracted. We are totally focused on the things that Australians are focused on - power prices. I was standing in the middle of Gymea on the weekend with my own constituents in my own electorate and they were talking to me about power prices. That is what they want us to focus on, with a real solution to rising power prices whether it is for businesses or householders, for pensioners and others, they are feeling it as the winter months really do now descend on us. That is why the Government is totally focused on the real solution when it comes to electricity prices. What we are doing with the Snowy Hydro Scheme and what we are doing by intervening in the gas markets, what I have initiated through the ACCC to put the big energy companies under the spotlight in terms of how they are pricing. These are the things that Australians want us to focus on, the rising costs of living, and that’s where our absolute focus as a Government is.

QUESTION:

The Prime Minister did say he would quit politics if he lost the next election. It is hard to see that as anything other than a direct dig at Tony Abbott, isn't it?

TREASURER:

I don't see it in those terms at all. The Prime Minister is taking us to the next election, and I hope many more beyond that because he is showing the leadership that is necessary. He is focused, as am I and the whole team, on what matters to Australians. They are interested in their power prices, what it is costing them, on housing. They are interested in what it costs them for child care. In the last 12 months we got our child care reforms through, which Labor frustrated for two years. Now we just get on with it. That is what we are focused on, getting on with delivering the solutions. 126 pieces of legislation passed in one year. In everything from real needs-based funding for schools, every single school that's out there in the public sector getting increased funding over the next two years, three years, five years, six years, 10 years. These are good results. They are being delivered.

QUESTION:

Is Tony Abbott being a team player?

TREASURER:

He is part of the team and we keep playing forward. That is the job of politicians, to work together to get the job done, to focus on the things that matter to our constituents and the Australian people. That is where 100 per cent of my focus is and 100 per cent of the Prime Minister's focus is and it is up to all of us to show that same focus on the issues that matter to Australians.

QUESTION:

You are on the conservative side of the party, do you feel that your side of the party was hurt by when Christopher Pyne spoke, and do...

TREASURER:

To be honest, I'm really not interested in that stuff and neither are Australians. I am interested in being a Liberal member of Parliament serving my community. That is what I'm focused on. That is the team I am a member of - the Liberal Party. It has many different members in it and we put ourselves forward to do an important thing and that is to focus on what Australians need in terms of the solutions to the problems they are facing. They're interested in their problems. They are not interested in the manufactured soap operas that others try to dream up. What we're focused on is their problems and solving their problems. That's what they sent us to Parliament to do and that is exactly what we are doing. After 12 months since the last election there is much to show for that. We will keep focusing on those things and getting them done but to finish on the issue of where I started with housing, it is pleasing to see that the measures, the steps that we are taking, the sensible, responsible steps we are taking on housing, are having an impact. It is ensuring, that the data shows to date, that we are moving towards a safe landing when it comes to housing markets in Sydney and the pendulum swinging back in the favour of home owners and first home buyers, which is good news. Great, thank you.