KARVELAS:
I want to bring in my first guest now. It's Michael Sukkar who's the Minister for Housing and the Assistant Treasurer, the perfect guest for this afternoon. Michael Sukkar, welcome.
SUKKAR:
Hi, Patricia. Great to be with you.
KARVELAS:
The Government have forecast a deficit of $4.2 billion for the financial year, instead, you've delivered a deficit of just $690 million. Do you accept, though, that the $4.6 billion underspend in the National Disability Insurance Scheme whatever the reason for it has been critical to achieving this?
SUKKAR:
Well, Patricia, no. I mean, this is pretty desperate diversionary tactics from the Labor Party and, in fact, if you go back to when the Budget was handed down, this is some $13.8 billion better than we had forecast then so this a significant improvement because unlike the Labor Party and we all remember the days of Wayne Swan when the Shadow Treasurer, Jim Chalmers, was his senior adviser, they would promise surpluses and deliver deficits. We take a conservative approach to Budget management and we've seen today, with a $690 million deficit, essentially a balanced Budget that we have overshot and overmet all of those expectations which we created when this Budget was handed down and, of course, since April it's improved even further from the bit over $4 billion deficit that we projected so this is good news. It just shows, Patricia, that Budget management that is disciplined can deliver dividends and after 11 years of deficit we think it's extraordinarily important to do this and to deliver a surplus this year. As for the pretty desperate
KARVELAS:
I don't know if is desperate, I mean, it's the Budget papers so
SUKKAR:
No, Patricia, you are
KARVELAS:
$4.6 billion underspend in the National Disability Insurance Scheme and clearly the bottom line
SUKKAR:
Patricia
KARVELAS:
is affected by this. How can you argue it's not? It's in black and white.
SUKKAR:
Well, Patricia, the reason why I took you through the Budget forecast so slavishly is because, as you are aware and many of your viewers will be aware, when you set a Budget you can do one of two things; you can take a conservative, approach which is our approach, which means we tend to ensure that we fully factor in any potential spending and we underestimate, to a certain degree, revenue, or we certainly don't we certainly don't do what the Labor Party did, which is bake in and factor in expenditure which was never going to realise itself. The NDIS, we have spent twice as much in this year's Budget as we did last. What you do in Budgets, as you know, is you take a best and a conservative approach to what the expected expenditure is going to be, as was outlined in Question Time today. We have been relying on data from the States, certainly on the number of people that will transition from the State based disability schemes into the NDIS; in factoring in what we expected the NDIS to cost, we took that State based data at face value. As it's turned out, the full numbers of people that have been calling on the NDIS in that time has been quite a bit lower than what the States had outlined and so the final Budget outcome reflects that but this is an uncapped scheme, Patricia. This is if you meet the criteria, if you apply, you get an NDIS package.
KARVELAS:
Sure, there's no doubt about that
SUKKAR:
This is a completely uncapped scheme so it is quite a desperate and grabby tactic from the Labor Party to really try and criticise this.
KARVELAS:
Well, it would be desperate and grubby if there was no criticisms of the NDIS or if people trying to interface with the system hadn't told us time after time that they were finding incredibly difficult so why wouldn't the Government
SUKKAR:
Sure, but Patricia
KARVELAS:
acknowledge that the underspend may actually reveal that there's a bit of a problem with the way it's happening, the way it's being rolled out and people's access to this funding package?
SUKKAR:
I think the more significant message here, Patricia, is that over time the NDIS is going to cost some $25 billion and in order for a Government to be able to solemnly promise the Australian people that it will deliver such an uncapped program, that we have to get our fiscal house in order and that's what today is about. Today is about the Government, after six years of hard work, six years of turning around the debt and deficit disaster of the Labor Party, seeing some fruits for the labour of Australians in a balanced Budget. I think it gives Australians confidence that we will deliver on the surplus this year, that we have promised. Let's not forget, Patricia, the Budget we inherited from the Labor Party was a $48 billion deficit so in a pretty short period of type we've turned a $48 billion deficit into a balanced Budget and next year or this year a surplus Budget, the only way you can guarantee the NDIS, the only way you can look at those families in the eye and say with certainty that we can provide for your loved one in an uncapped NDIS is if we get our house in order. So this is why it's quite desperate and grubby from the Labor Party, because I don't think if the Labor Party carried on with their debt and deficit disaster that they would be able to do that because, quite frankly, the fiscal position of the Australian Government would be in tatters if the disaster of Labor continues.
KARVELAS:
OK, let's leave Labor, they lost the election, you're in charge so what they can
SUKKAR:
Well, Patricia
KARVELAS:
deliver is kind of irrelevant to this conversation. I need to get you on your portfolio so let me move on.
SUKKAR:
Sure.
KARVELAS:
Lord Mayors from across the country want to strike a deal to have social housing debts to the Commonwealth waived so the money can be funnelled into new social housing similar to the deal that you struck with Tasmania; will you consider it?
SUKKAR:
Well, no, actually, I mean, that was a request from one jurisdiction but the capital city mayors were really speaking to me about the homelessness issues that seem to be coalescing around the major cities and they're seeing that a lot of the homelessness issues that have been over previous decades dispersed more broadly in their State are now starting to really, really impact the major cities more than ever before and they have asked for a couple of things. They want to renegotiate the National Housing and Homelessness Agreement which is a funding agreement between the Commonwealth and the States where the Commonwealth provides each year $1.3 billion of funding which is then allocated by the States into housing and homelessness programs.
KARVELAS:
And will you do it?
SUKKAR:
Well, as I said to them, we renegotiated the National Housing and Homelessness Agreement just about 12 months ago or 18 months ago was when it commenced and it would require the agreement of all of the States and Territories so really what I said to them is if they are able to convince their particular State and Territories of which they are their capital cities reside, we would be happy to look at it but
KARVELAS:
But you're also in charge here, federally, so instead of just making them do the work, if you think it's a good idea, why don't you do the same thing and go to the States and Territories and say, "We need to change this."?
SUKKAR:
Because we've just renegotiated the National Housing and Homelessness Agreement, Patricia, and I'd be very happy to come back and take you through in detail the series of requests and additional work that we hoped to bake into that agreement
KARVELAS:
OK.
SUKKAR:
and the States and Territories
KARVELAS:
But at the heart of this
SUKKAR:
Couldn't agree to.
KARVELAS:
Sure.
SUKKAR:
But in the end it's got to be
KARVELAS:
But at the heart of this, Tasmania's got a better deal than any other State. Surely you can understand the frustration of people who want to waive those debts so that they can put it into social housing and help all those people that you talk about?
SUKKAR:
Well, Patricia, again, that wasn't discussed yesterday other than with the ACT Chief Minister so
KARVELAS:
Let me just put it to you though.
SUKKAR:
It's not a basis of the discussion.
KARVELAS:
It doesn't seem fair that Tasmania got a special deal that other States haven't? Would you consider extending that to other States and Territory s?
SUKKAR:
Well, what I've said very clearly is Tasmania met a very high bar for this particular debt forgiveness. Firstly, they were able to demonstrate a really significant and urgent need. Secondly, they were able to demonstrate that they would use all of the money that was saved $230 million for Tasmania that they would ensure was put back into housing and homelessness services and, crucially, they committed to undertaking serious planning reforms, Statewide planning reform which would ensure that the supply of housing kept up with population growth because in the end, Patricia, in the housing space, if you're not getting enough houses or dwellings out of the ground to meet the demand of the market then you'll always have affordability issues and we know that that cascades all the way along the housing spectrum from the private rental market to the social housing market, the community housing market and of course into homelessness so Tasmania met a very high bar and I know that other States and Territories have seen what that looks like and they are of course free, as the ACT Chief Minister did yesterday, to make the request and of course we would consider it on a case by case basis but to think that Tasmania didn't give a lot in exchange for that forgiveness is wrong.
KARVELAS:
OK.
SUKKAR:
And, you know, I would expect that it would be quite difficult for some jurisdictions to meet that bar but of course that's up to them if they're willing to do that.
KARVELAS:
It's estimated, though, that Australia needs to build 1 million social and affordable housing homes by 2036, that's the modelling. So, do you accept that you need to start providing that now to deal with this unfolding crisis on our streets? We see it every day. You live in Melbourne, I live in Melbourne; we see it every day.
SUKKAR:
Well, Patricia, you should familiarise yourself with the National Housing Finance Investment Corporation which
KARVELAS:
I'm familiar
SUKKAR:
the now Prime Minister, when he was Treasurer, and I delivered in a really significant Budget with a huge housing component. It's, in its first year, funnelled hundreds of millions of dollars into community housing through Government backed and Government guaranteed debt. It will also shortly be deployed funds out of a $1 billion infrastructure facility which is essentially a facility to get these sorts of projects out of the ground. I think in its first year we've seen significant projects building, finance, new projects, partnerships with State Governments where the National Housing Finance Investment Corporation's been involved. We think this model works. The community housing sector, I think, has absolutely applauded the Government's decision to set up NHFIC
KARVELAS:
But do you think more needs to be done
SUKKAR:
And of course
KARVELAS:
I mean, that's at the core of my question. You're talking about what you're already doing. The sector's saying more needs to be done to meet this unfolding crisis. Do you anticipate that you need to do more?
SUKKAR:
Well, Patricia, the point I keep making because it's extraordinarily important here is that Local Governments and State Governments, which control our planning schemes and zoning really hold the keys to the biggest areas of reform that is necessary because there's a lot of capital, there's a lot of community housing providers that now have increased access to capital due to the work of this Government but deploying that capital and getting houses out of the ground is a lot more difficult because of very slow, truncated, unpredictable planning schemes and in our meeting or in my meeting with capital city lord mayors, I mean, that was, quite frankly, acknowledged by them. In the end, there's not a shortage of capital ready to be deployed in this space but there's a shortage of opportunities due to those issues. So I don't want to point the blame at any individual or level of Government. We're willing to work, as we have, and put our money where our mouth is to get these sorts of reforms happening but in the end, I would be lying to you, Patricia, if I said I have a silver bullet solution that I can deploy in every housing market around the country, remembering that the housing market in Melbourne is very different to southeast Queensland, very different to metropolitan or regional WA.
KARVELAS:
OK. Just briefly, the Government is also guaranteeing homeloan deposits through the National Housing Finance Corporation for 10,000 eligible Australians. It's not a lot of spots, is it? I mean, it's a very small program, 10,000 people. It's a pretty big country. Is this a wait and see program? Are you willing to expand it if you think it ends up being successful?
SUKKAR:
Well, Patricia, it's a phenomenal program and it's
KARVELAS:
But small.
SUKKAR:
10,000 first home buyers a year is significant. That's 10,000 a year and it will ensure that first home buyers can get their foot on to the property ladder with as little a as a 5% deposit and, as I said in parliament yesterday, one of the hardest things for first home buyers, as it's expressed to me and other members of the Government, is getting that deposit together. The average time it's taking people to get a deposit together in Sydney and Melbourne is 10 years and 8 years respectively. There are income caps that will be applied to this scheme which starts on 1 January next year so it's $125,000 for an individual or $200,000 for a couple. There will be house caps as well so to ensure that it's going to those who most need it and that means that, in our view, there's a pretty good opportunity that if you qualify and you want one of these guarantees you'll get a really good opportunity of getting one. Like all these things, we'll have it ready for the first of January, we'll assess how it goes. I think it's going to be very popular. I think people are going to be rushing to it.
KARVELAS:
And if it is, would you look at making it a bigger program?
SUKKAR:
Well, let's just see how it goes, Patricia.
KARVELAS:
But are you open to that? I mean, it has been criticised for being small. This is the critique.
SUKKAR:
I don't think that is a fair criticism at all. I don't think 10,000 loans a year this is not 10,000 over the life of the program. 10,000 loans a year I don't think is small
KARVELAS:
OK, but are you open to expanding it and making available to more first home owners?
SUKKAR:
Well, Patricia, I think that's prejudging what I've just said to you. I think we want to see how it goes. I think it's going to be very popular and, of course, we always assess the programs such as this that get started and how they're going and we will do the same in this instance, no doubt.
KARVELAS:
Just finally on a story that's broken this afternoon, the Federal Court has ruled that the Tamil family from Biloela can remain in Australia until their case against deportation is decide; what do you make of this decision? Because clearly the courts have decided that they can fight their way through the system.
SUKKAR:
Well, I don't think that's particularly news to anyone, Patricia. I think we've all seen instances where people who are seeking protection or in one form or another are trying to either get permanent residency in Australia are able to exhaust a whole lot of legal entitlements and those can often stretch into years and years and years so I don't think it's a particular surprise to see in this instance that they are exhausting all of their legal avenues and, in the end, we operate by the rule of law but we know as a Coalition that it is extraordinarily important to have an immigration system that has integrity, that treats everybody with fairness, that doesn't treat some cases differently because they're high profile, that treats every case on its merits and I think in this particular case we've had a number of courts not just one a number of courts who have determined that the applicants in this particular circumstance are not genuine refugees. That is a decision of the court and here we've got a decision that's provided some additional time for them to exhaust further legal avenues and that's to be expected and not unsurprising, I suppose, Patricia.
KARVELAS:
Michael Sukkar, thanks for coming on the show.
SUKKAR:
Thanks for having me.
KARVELAS:
Michael Sukkar is the Assistant Treasurer and Minister for Housing and lots of questions there not only on today's economic figures, which of course are key and Government on track to move to surplus, but also on all of his portfolio areas housing being a huge one and issues around homelessness and social housing. He's been under pressure on those issues. He seems to be saying, essentially, to other States, "If you want your debt waived you've got to make a pretty strong case," and it didn't sound to me like he was particularly open to other States and Territories doing the same as what Tasmania has done.