E&OE

SALLY SARA:

The Shadow Treasurer, Angus Taylor, is my guest. Angus Taylor, welcome back to Breakfast.

ANGUS TAYLOR:

G'day, Sally. Great to be with you.

SALLY SARA:

The housing economist Peter Tulip says your policy will help some lucky beneficiaries while pushing up prices overall. How do higher prices help solve an affordability crisis?

ANGUS TAYLOR:

Sally, thanks for having me of course. And the truth is that this won't do that. The critical point here is that this is focused on new houses and by encouraging new houses into the marketplace, we can support the extra demand. It's deliberately targeted in that way. And we know developers, if they have surety that they're going to have a buyer when they build a house, are much more likely to build that house. We see across Australia tens of thousands of housing projects that are stalled, that are not happening. I speak to those developers and builders who are behind those projects, and they say we just don't have buyers at the other end of the pipeline. This will give us those buyers for new houses, not for existing ones. We'll get new extra houses into the marketplace and support those first home buyers back to restore that great Australian dream of home ownership which we have seen eroding in front of our eyes in recent years.

SALLY SARA:

But what about the time frame here? Won't this deductibility scheme come into effect before these new houses are built?

ANGUS TAYLOR:

Well, no, the plan is to get houses built as quickly as possible. We know new houses will be built if there are customers at the other end.

SALLY SARA:

We know there's a housing shortage already, don't we?

ANGUS TAYLOR:

Well, sure, but we need to get more houses into the market. Now, I've got tens of thousands of houses in my own electorate, in my own part of the world, which are stalled. We know we need to bust those infrastructure bottlenecks to get them out into the market. That's why we've got a five-billion-dollar fund to do exactly that. We also know we need to have buyers at the other end for these houses. And so, this policy is designed to do that. By focusing on new homes, we know it is a supply solution as well as a demand solution. And it can help first home buyers, who are the group who are struggling the most. I mean, they don't have the equity behind a house that a second or third home buyer might. And so it's so crucial that we give them the ability to get into the housing market and importantly, a new house which encourages extra supply into the marketplace.

SALLY SARA:

So, just so I'm understanding what you're saying and the thinking behind this policy. So, is what you're articulating, that in your view there's not enough demand for new houses at the moment?

ANGUS TAYLOR:

Well, there's not enough supply and new house buyers, first home buyers, can't afford to buy them. They're the two problems and both matter, both really count. So, we have to fix both the supply side and the affordability side. This policy will do both. This is crucially important. We also know that when a developer decides to proceed with a development, they don't need all of the new houses underwritten, they need a portion. They need a surety around a portion of them. And so this will ensure that those pipelines of houses can get built, whether they be apartment apartments or freestanding houses. It applies to all. We know that this can get that pipeline moving. And right now that pipeline has been decimated. It's around half of what it was. If we don't get it moving quickly, we simply won't have the housing supply. And we're already seeing a situation where first home buyers simply can't afford to buy a home.

ANGUS TAYLOR:

How many people do you say will benefit from this? Labor believes it'll be fewer than 13,000 a year.

SALLY SARA:

Well, except that we know that the industry has told us that this will encourage the supply of an extra 30,000. The housing industry association has been clear about this, and it was for the point I just made. If developers know whether they're building apartments or they're building freestanding houses, a certain proportion of them are underwritten by first home buyers who are able to afford the house, then they can get that pipeline of houses built. So, it is crucially not just a demand side measure, an affordability measure for young Australians to live that great Australian dream of home ownership. It is also a supply side measure and that is why this is, I think, such a clearly targeted policy to address the challenges we've got right now in our housing market.

SALLY SARA:

You're listening to Radio National Breakfast and I'm speaking with the Shadow Treasurer, Angus Taylor. Let's zoom out for a little bit Angus Taylor, and look at the big picture. You've got your tax offset at around $10 billion, fuel excise at around $6 billion. And further announcements as well. Throughout the past three years, and even at the start of this campaign, you said that getting debt and deficit under control was the most important thing to do. But now the Coalition is also pushing billions of dollars out the door. Have you abandoned fiscal responsibility in your bid to chase votes here?

ANGUS TAYLOR:

Absolutely not. Absolutely not. Look, we've opposed over $100 billion of Labor’s spending that we think at a time like this is wasteful. And you and I have discussed some of those measures we've taken. There's been criticism of the positions we've taken on some of these things, but we've done it just like a household has to put money aside at times for the future so that we are able to afford these things at a time when Australians have seen the biggest hit to their standard of living in history.

SALLY SARA:

But you'll also be borrowing to fund these promises, correct?

ANGUS TAYLOR:

Well, but let's be clear. We will come out with our costings before the election. I heard you talking to Peter about that before the program. And our budget position will be stronger than Labor's. And that is possible because we have made the hard decisions over the last three years on measures that Labor's taking that we think are not the right measures for Australia. That allows us then to deal with the burning issue Australians have, which is the biggest reduction in their standard of living in history, worse than any other peer country in the world. That means we can deal with these short-term cost of living issues, which gives us time then to get the economy back on track, to get it growing and most importantly, grow the economy faster than spending, put aside windfall commodity revenues in our future generations fund and get the economy back on track.

SALLY SARA:

We've got less than a minute up our sleeve before we hit the news. In your view, has the risk of resurgent inflation dissipated now?

ANGUS TAYLOR:

Well, no, it's always a risk, which is why we've carefully staged these measures. 25 cent fuel excise and getting gas prices down in the short term to take energy pressures away from Australians. The tax offset in the next financial year as we get the economy back.

SALLY SARA:

But you'll be pushing more cash out the door as well. Is that not inflationary?

ANGUS TAYLOR:

Well, no, because our budget position will be stronger, substantially stronger than Labor's. It's the overall budget position that counts at the end of the day, if you want to beat inflation, if you want to get the economy back on track, if you want to boost growth, if you want to back business to make the investments we need.

SALLY SARA:

Angus Taylor, we'll need to leave it there. Thank you very much for your time on Radio National.