Mark Levy:
Michael Sukkar is the federal Housing Minister and he joins me on the line right now. Minister, good afternoon.
Minister Sukkar:
G’day Mark. Great to be with you.
Mark Levy:
Thanks for joining us. What’s been the reaction since the announcement this morning?
Minister Sukkar:
Well, Mark, obviously there’s been a number of people that have fed-through to my office and colleagues, that this is really the catalyst for them to take that step, to purchase their first home or to purchase a new home and upgrade or, in a couple of cases, even press the button on that potential renovation that they were about thinking about. The whole point of a $25,000 grant is to encourage those people to make that decision, primarily to support the 500,000 jobs in the residential construction industry that the industry has said are at risk and that we know are at risk in the second half of this year with the significant slowdown in construction activity as a result of COVID-19. Those 500,000 jobs, Mark, aren’t just the tradies on-site, the bricklayers, the carpenters, the plumbers, this also includes the Australian timber mill workers who build the trusses and produce the frames, the manufacturing workers who make the glass and the brick and the tiles. It's a massive supply chain, one of Australia’s largest employers and to protect those half a million jobs that are at risk of being lost, the HomeBuilder program, we think, will encourage a whole lot of Australians to take that step to build a new home or renovate a new home which will mean they’re employing Australian people to do that.
Mark Levy:
I’ll to get to some of the concerns from my listeners in just a second, Minister. But the one thing I do want to stress, and you had to means-test this because we've seen in the past what's happened with things like the pink batts scheme and we all know what happened there. So, how important was that in the back of your minds when you sat down and came up with this stimulus package?
Minister Sukkar:
Yeah, Mark, look we want to make sure that the mistakes of the Labor government aren’t repeated and the primary way we do that is to make sure people have got skin in the game. So yes, you get a $25,000 grant if you undertake a substantial renovation or if you purchase a new home. But you're obviously putting a whole lot of your own money in there at the same time which means you’re less likely to see waste. We’ve also put in place a whole range of integrity measures to make sure only licenced builders can be used. That, you know, we've got quality workmanship that is being undertaken. So we really wanted to make sure that we didn't see the mistakes of the past being repeated and the best way, as I said, to do that, Mark, is to make sure that this is $25,000 that tips people over the edge to do it, but they're putting a whole lot of their own money on the table at the same time so they've got a skin in the game to make sure it's done properly.
Mark Levy:
Minister, it’s tough times for everyone out there listening at the moment given what we're going through at the moment, the global health crisis and we've dipped into recession, the Treasurer made that announcement yesterday in Canberra. What do you say to those people who are saying to us today on radio “well we don't have $150,000 to spend on renovations and to do up the house”? What’s your response to those people?
Minister Sukkar:
Well look the program is predicated on the basis that about 70 per cent of the program will be people who purchased a new home. So, that will include first time buyers who are taking that step to purchase their first new home, someone maybe as the family’s grown, they’re upgrading from the town house or unit or the apartment to something a little bit bigger and we wanted to include large renovations because there are 14,000 large renovations that are undertaken each year in this country and from my perspective as a jobs program, Mark, whether that tradie is building a new house and land package or building an apartment or working on a renovation to an existing home that is just as equally important and so it won't be for everyone, no doubt but there are, as I said, 14,000 large renovations of this kind each and every year and the evidence clearly was not just with first home buyers and new home buyers but a lot of people were holding back from making those investments because of the uncertainty of COVID-19. We think this will tip a lot of those people over the edge to say “you know what, I'm going to take advantage of this while I can, I'm also going to invest a whole lot of my own money into it at the same time”, which is going to support those half a million jobs in the residential construction industry. Everyday Australians who work in that industry and I think the worst possible situation, Mark, would see them lose their jobs in the second half of year as the pipeline of work dried up.
Mark Levy:
You and I could sit here and talk about the package all afternoon, but I want to put some questions to you if I can. I've asked my listeners to email through some questions to you given you are the Housing Minister, so if it’s okay I might put some of them to you?
Minister Sukkar:
Of course, Mark.
Mark Levy:
I’ve received an email from one person who says maximum house and land prices $750,000. Apart from some postage stamp size blocks in Sydney's west, a block of land is going to cost you at least half a million dollars virtually anywhere in Sydney and there aren't many new homes that you can put up for $250,000. That way most people in Sydney are out of this automatically, what’s your response to that?
Minister Sukkar:
Well, in consulting with the industry, this included a huge number of the industry in New South Wales and Sydney. There are large areas of greenfield development sites that will absolutely have stock that falls within $750,000. But I acknowledge $750,000 isn't going to get you far in a number of areas in Sydney. Equally though, this is a national scheme so it applies nationally but there is a huge amount of stock, including apartments, that fall within this cap but I acknowledge that in a market like Sydney, $750,000 is certainly a dwelling that is either relatively humble or a long way from the CBD. But we’ve got to target these things and when we’re using taxpayers’ dollars to target it to those people, who this is really going to be the catalyst decision to make them buy a home, you’re really looking at that end of the property spectrum.
Mark Levy:
All right, I’ll squeeze in a couple more. Another listener says “what about the red tape at a local government level?” Because you know better than anyone, being the Housing Minister, that it takes months and months and months of council delays. You only have 90 days from the date of contract, to get this up and running to ensure you're eligible for the grant. Have you had any discussions with the Local Government Minister or the respective councils across the country to help out there? Because as you can tell, there is a lot of people out there saying it was hard enough to get approval to build a house, let alone get a grant.
Minister Sukkar:
Mark, I absolutely agree with your listener’s question and comment that’s embedded in that. There’s a couple of things. Firstly, there is nothing to preclude people from progressing council applications before they have signed a contract and then signing a contractor on once they’ve got that lined up. And in fact, we know anecdotally there’s a number of those cases where all those approvals are in place, but people just don’t feel confident enough to press the button on the renovation or indeed the new build. But there is a much bigger piece of work here to say, well, how do we get construction activity happening more quickly, unblocking the pipeline and you know, this is not a criticism of anyone in particular, but New South Wales is certainly one of the tougher jurisdictions as far as getting council approvals.
Mark Levy:
All right, another one here and this will be the last one, it's a message from Trevor and I think this is a really important one because there's a few emails asking the same question. If someone has pre-approval and are currently looking for a builder, are they eligible for the grant?
Minister Sukkar:
Absolutely, so what we announced today was that the scheme will apply to all contracts that are entered into from today onwards. So, if you’re out there on the hunt, you're looking around but you haven't pressed the button and signed a contract yet, you’re in a very good position because you're obviously a long way down the path and, provided you sign a contract from today onwards, you’re eligible for the HomeBuilder grant and we wholeheartedly encourage you to make that decision because your decision is going to employ Australian tradies and other workers and will in-turn, support one of our largest and most important industries.
Mark Levy:
One last one Minister from me. I took a call in the first hour of the program from a farmer in Queensland and I’ll start first-off by saying I applaud what the Government’s trying to do in kickstarting the economy and getting us out of recession and getting people back into a job but you’ll remember that before the bushfires, before COVID-19, the message was “we've got to support our farmers”. I took a call from Alan in the first hour of the program and he's feeling a little bit left out as far as the Federal Government is concerned because he keeps being told that we're going to look after our farmers but he’s not seeing any money. So, when you go into your party-room with the Prime Minister and your colleagues, can you raise that again, because there's a lot of farmers out there that feel that they’re being forgotten by the Morrison Government?
Minister Sukkar:
Well, Mark, in response, I’d say – and it may sound reasonably self-serving here but having been working very closely with the Prime Minister over the last few months on our economic response to COVID-19 – that farmers have not been forgotten. They’re at the foremost of many of the policies we’ve put in place. For example, we increased the instant asset write-off which has been massively popular with farmers who are improving their fencing or taking advantage of the rain by reinvesting in large capital, so giving them significant tax concessions and deductions to do that. That was primarily driven by us trying to support our farmers and people in regional Australia. So, we’ve got to be kept on our toes with these things all the time, Mark, I accept, but farmers are always at the front of our minds, I can assure you.
Mark Levy:
Well Minister, you can’t help everybody, you’d like to help everybody but it’s virtually impossible but I think what you’ve done today, you’ve certainly helped a lot of people who are trying to get into the housing market or are in the housing market, that can certainly do with that grant from the Federal Government with HomeBuilder. So, for that you should be applauded, obviously the questions will continue, but well done.
Minister Sukkar:
Good on you Mark, thanks.