Senate Economics Legislation Committee, , 1:10:26 to 1:17:26
The committee debates the impact of restricting Self-Managed Super Fund borrowing on housing supply and the role of the Local Infrastructure Fund in supporting new builds.
Topics: Infrastructure, Government spending
Speakers: Senator Andrew Bragg, Jenny Wilkinson, Hon Katy Gallagher, Katrina Di Marco, Unknown Speaker, Dr Angelia Grant
Thanks very much. Just a couple of questions on housing.
So Senator, we have forecast dwelling investment, which is slightly different to the number of the number of the.
I'm asking how many houses does the Treasury think will get in Australia this year. I know that housing is a key issue for the government. Secretary, you mentioned it in your opening statement. How many houses would we get this year?
Housing group may be better place than I am.
Secretary, do you know how many houses we're supposed to get in Australia this year?
Senator, I don't have that with me. As I said, um, from a macroeconomic perspective, um we um we are looking at uh the number of so we look at approvals and commencements and completions, and um they have all increased uh reasonably significantly over the past year. Well, all of these are measures of additions to uh the housing stock. Okay, so I don't we from a macroeconomic perspective we don't forecast the number of houses.
Move on.
Go ahead.
I want to be efficient.
Uh first assistant secretary macro conditions and population division. As we've said the uh housing group is best placed to answer the question about the case.
Well, the Secretary of National Key Council publishes its report. Thank you. Let's numb to coming back to you, Secretary. So in terms of the other issues I want to ask about in terms of housing, so the the budget contains measures to restrain housing supply in terms of the taxes, but also subsequent to the budget, there was the the deal with the the grants in the Senate to cut housing supply through SMSF investment. So why is it a good idea to reduce housing supply in any event in a housing crisis? And how many fewer houses will there be as a result of the SMSF ban?
Uh so Senator, I might just come back to your question. Um the data I have, and I I'm very happy for you to to confirm this with housing group is that 176,000 private dwellings were completed over 2025-26. Um so that's that's how many houses were built in 2025-26, and as I said, the pipeline which we measure through things like approvals and commencements have suggested that there is ongoing activity through into 26-27.
Okay, so the question go ahead. The question is why are you cutting housing supply and how many fewer houses will there be as a result of the SMSF ban?
So, Senator, the in the budget, um the government also uh announced the local infrastructure fund. The local infrastructure fund is designed to provide the enabling infrastructure in order to support additional housing. So you need to look across all of these measures together. I don't have an estimate in front of me of the net impact of all of these figures. I don't know whether Dr. Grant for you do. Um but I'm I'm I'm I'm sure that when housing group appear later in the Treasury said it was 4,000.
The Treasury said 4,000. Um he said 4,000 fewer houses will be built as a result of the SMSF ban. I assume you did you talk to the Treasurer about this particular proposal before it passed the Senate?
Senator, I I I'm just saying I don't have those numbers, and I don't want to mislead uh the Senate. Sorry, uh Mr. Marco might be able to.
Thank you, Secretary. Um in terms of the limited recourse borrowing arrangements, Senator, um I understand that's the figure that the Treasurer Treasury used. The number that we have in terms of uh I'm not certain uh the number that we have is that overall in 2324, around 8700 SMSFs enter into a new limited recourse borrowing arrangement. So again, when you look at that in terms of the scale of the overall um overall kind of lending in the economy or activity in the economy, that's less than half a percentage point of new residential borrowing every year. And so then that's going to have both established and new? Once you start to break that down, Senator, again, these are quite small changes.
But I just say that the point is here that while you want to restrain any housing supply in a housing crisis. We just heard from the Secretary we might get 180,000 houses in this country this year. We used to get more than 200,000. Minister, you did this deal, uh think with the Greens in the Senate. Uh there was no reason to take. Uh you say the Treasury said 4,000 fewer houses as a result of this ban. The industry says more like 16,000. Um do you stand by your 4,000 figure, Minister? Um you stand by it.
Sorry?
So you stand by it.
Well, I the evidence that's just been given to you is evidence from Treasury, and I trust that advice. Um, can I answer your I don't know what's going on, but you uh interrupting a lot, Senator Bragg. But in the budget papers, um overall, the budget delivers 30,000 more homes. Uh and in some of the data that we've been seeing recently, uh commencements were up 7% in the June quarter after the budget and 14.4% in annual terms. When we came to office, they were going backwards 28.9% in annual terms. Completions were also up, 5.8% in the quarter and 15.9 in annual. When we came to office, they were going backwards 7%. I don't think anyone could sit here and say that the government is not using every lever available to ensure we are driving supply across the housing market. So you've been critical of all of the policies that we've implemented in order to do that, Senator Bragg, and in fact, have tried to delay on many occasions.
Okay. Well, look, I don't think let's just I want to be efficient, so I don't mean to be obtused. I'm just trying to get a lot of information out in the short time that I have. So you mentioned in your opening statement, Secretary, about the impact the taxes, you think you call them tax reforms having on the housing market. So what is the impact they're having? So Senator In terms of pricing, in terms of prices.