Some pictures of Brisbane’s Labour Day march, attended by the opposition leader are rolling in.
Here is Anthony Albanese alongside Queensland’s premier Annastacia Palaszczuk sporting a cap. Everyone is looking very sun smart.
Interesting insight from our economics correspondent Peter Hannam.
While all eyes are on the RBA cash rate, ANZ job ads flatlined in the past month.
Thanks as ever to the lovely Amy Remeikis. I’ll be with you for the rest of Day 22.
Caitlin Cassidy is going to guide you through the afternoon – so make sure you keep checking back for updates.
I’ll be back early tomorrow morning for Day 23 – also the day the RBA makes its rates decision, so get ready for a big one.
Thank you all so much for joining me – take care of you Ax
Scott Morrison likes to say that it has “always” been tough to buy a first home, and often uses his own first purchase as an example.
He often neglects to put that in context. As Lech Blaine writes in his Quarterly Essay Top Blokes:
The late bloomer didn’t move out of home until the age of twenty-four. In 1995, now twenty-seven, he departed to be deputy CEO of the Australian Tourism Taskforce. It was a fruitful period; he also joined the Liberal Party. That same year, Scott and Jenny bought a unit on Pacific Street in Bronte. They negatively geared it for leverage, and bought a Californian bungalow on Lugar Brae Avenue, two streets from where Morrison grew up.
Their second property cost $330,000. The median national house price was $129,800. They sold Lugar Brae Avenue for $985,000 in 2009. Morrison hasn’t spoken about when or for how much they sold the Pacific Street unit.
“I remember the first place I bought with Jenny,” he said in 2018, neglecting to clarify whether he was talking about his negatively geared investment property or primary address.
“It was 53 square metres, it was not very big. It was very, “very small. But that was what we could afford, and that’s how we made our start.”
Scott Morrison ends the press conference there.
Like Anthony Albanese, there are still questions being shouted.
No one managed to get a question in about the family which approached him asking about Afghanistan visas earlier today.
Q: You campaigning parameter as a superior economic manager. Are voters supposed to believe that you will separate yourself from what happens tomorrow and claim you have no response ability for the conditions?
Scott Morrison:
I think I have set up the position pretty clearly about the macroeconomic environment that is impacting on rates in Australia. I think I’ve been very clear.
I also didn’t claim credit [when rates dropped].*
These are driven by macroeconomic factors but also the alignment of fiscal and monetary policy in this country to take us through the pandemic. I don’t see all that through a political lens.
What I do see is the need to ensure that we have a strong economic plan that deals with the real pressures, the pressures on interest rates I think highlight just as we have got the pressures on cost of living, highlight just why the economy is so important in this election.
And why it really is a choice about a strong economy or a weaker economy under Labor, about the certainty of our economic plan and the lack of an economic plan under Labor. And the certainty of what you know about what we have been able to do and how we have been able to take Australia through in our plan for the future and what people don’t know about the Labor party is what I said yesterday at Homebush. There are two reasons why Mr Albanese he won’t tell you about his economic plan, the first one is he doesn’t have one. He just doesn’t have one. And the second is he doesn’t want to tell you after at the last election when Bill Shorten told the Australian people what they were going to do, the Australian people rejected it. We have an economic plan that Australians know and Labor do not have an economic plan. We have been waiting for three years for one. Then a month after the budget. And now even after their campaign launch, Labor, still no economic plan**.
*Direct credit may not have been claimed but low interest rates have been mentioned repeatedly by Morrison and Josh Frydenberg when laying out the government’s economic record and credentials in parliament and out.
*There is a plan which Labor has put forward.
Potential rate rise ‘not about me’ claims Morrison
Q: The Reserve Bank raises interest rates tomorrow, do you think that will hurt the Coalition’s chances at the polls?
Scott Morrison:
You know what, it is not about politics. It is not about politics.
What happens tomorrow deals with what people pay on their mortgages. That is what I am concerned about. It is not about what it means for politics. I mean, sometimes you guys always see things through a totally political lens. I don’t. And Australians don’t.
Australians are focused on what they are paying for and who they think is going to be best able to manage an economy and manage the finances so they are in the best possible position to realise their aspirations. Australians know that there are pressures on interest rates.
That is why many of them, so many of them have been switching to fixed rates. That is why many of them have been trying to get ahead of their mortgages to ensure they are protected. And we have help them do that so they can be in that position because they understand, there are many pressures on our economy. What tomorrow’s decision is about, we have cash rates, at least I know what it is, the cash rate, we know what it is and we know it is at a historic low and it has been there since November 2020. We note the Reserve Bank in monetary policy and the federal government through fiscal policy have been pulling in the same direction to ensure we could come through this pandemic.
It has been important that a line of perspective that has helped Australia to be one of the most successful advanced economies in the world today coming out of the pandemic. So tomorrow, it is not about me. It is not about Mr Albanese. It is not about the treasurer or the shadow treasurer. It is about Australians themselves and the decisions they are making and understanding the pressures on the economy and who they think is going to be better able to manage those pressures into the future.
Q: Many pensioners would like to work more. Obviously, pensioners are out there struggling at the moment and cost of living is increasing and things are getting tough. Many pensioners would like to earn more but they can only earn roughly an extra $300 a fortnight and keep their pension. Why isn’t the government trying to make it easier for pensioners to fill those skills shortages when they would like to earn more but they currently can’t?
Scott Morrison:
This is something we have been looking at carefully and it is something that we are talking to older Australians about.
We have had programs, particularly during the pandemic, where we did ease those restrictions and the take-up wasn’t that great. Those who have worked hard all their life and are on a pension or a self-funded retirees don’t necessarily want to be forced back to work. And that’s why, and when they do, and earn, certainly what they are earning far outweighs what they get in their pension.
That is why they would choose to do that. But equally, we are encouraging the skills training that enables people over the course of their life to move between different jobs and take those opportunities and when they get to their retirement they can have their retirement.
They can have their time like they are having here. The solution to our economic challenges is not to send retirees back into work. That is not my plan.
I am not looking to put pensioners or self-funded retirees back to work. What I am seeking to do is ensure that in their retirement that they have worked hard for that they can have life a little bit easier through the sorts of things that I am announcing right here today. And self-funded retirees in particular, they benefit from things like our tax cuts.
They benefit from the many other benefits we put in place. We are looking closely at those issues. I would say. I want to be very clear that anything in that area is not about sending pensioners back to work.
Where people want to make those choices, they are choices that they are making now. But when we have eased those things in the past, we haven’t seen a very significant change in the amount of people taking on that choice because when people get to retirement they would like to have their retirement.
Q: Hundreds of thousands of Australians may go into mortgage stress if the Reserve Bank increases rates tomorrow. If that happens, will you take personal responsibility for the financial pain they may feel?
Scott Morrison:
Explain to me the numbers. You said hundreds of thousands of people will go into mortgage stress … What are these reports?
Q: There are reports in the paper today that if mortgage rates go up then it puts pressures on them because they have maxed out their mortgages. Will you take responsibility if rates go up?
Morrison:
When I became prime minister the cash rate was 1.5%. It is 0.5%. We are talking about the average discount of around 3.6 but many people will be on lower mortgages than that.
We have got people that have moved from 20% fixed rates to 40% fixed rates, and you know what that tells me? Australians know what is going on.
They know there are pressures that are coming from outside of Australia on interest rates. I mean, 0.1 has been an historically unconventionally low rates and it has been there since November of 2020.
So, these rates are very low, and Australians know that there is pressure on at these rates and they know that over time, how we manage the economy, how we manage the government’s finances will impact, potentially, and what happens to rates, and they could go higher than they might otherwise go.
That is why economic management and financial management as a government is going to play a key role in just how much more people are going to pay, and so the bank will decide.
The Reserve Bank – the independent Reserve Bank – should rightly decide where cash rates are set.
They are at historic lows at the moment at 0.1%, but what I do commend the Australian people for – they have in making the choices to move to fixed rates to ensure that they can get ahead of that mortgage and to be paying down and ensuring that they have been building up buffers.
I mean, you can also see on household balance sheets hundreds of billions of dollars on household balance sheets as Australians have been insulating themselves over the course of the pandemic to deal with these shocks that they knew would be coming, and so, my commendation to the Australian people is they have been following the same a prudent financial management that the government has, and that has built up protections, and that is what we have been doing.
Could you imagine how much harder it would be to pay a mortgage if we had not have jobkeeper and 700,000 people were out of a job, or we did not do the cash flow boost which would have seen small businesses collapsing all around the country, all the support we are providing to first homeowners to get in and own their home in the first place?
I mean, we have been taking steps to strengthen the resilience of our and the resilience of household family balance sheets and a small business balance sheets so they can deal and whether with the challenges that we are going to face.
Q: If you are re-elected will you commit to an Indigenous Voice referendum in the next term of parliament?
Scott Morrison:
I have answered that. It is not a referendum on the voice in our policy so why would I be doing that?
Q: Five years ago you said the Victorian government doing a similar government scheme was a good idea, so what has changed?
Scott Morrison:
I think I have made it … There is a scheme like this in Western Australia. There is a scheme like this in South Australia and the take-up of the schemes are very limited and one of the reasons for that is people want to own their own home. They don’t want the government to own their home. If people want to go into a shared equity mortgage, those products have been around for a long time.
The private sector provides those products and what I was referring to in 2011, I think it was, was in the middle of a global financial crisis when there was a squeeze on credit so I was proffering sensible interventions that would enable the private sector to give people more choices.
If people want to take the choices up, that is up to them, but in terms of the federal government effectively becoming an owner of your home – and there are questions about this. So, what happens if you decide to renovate your home? I mean, what Labor have been very clear about is that they have a share in your home, and so, as your home value increases, they are making money off you.
So, as your home price goes up, your home value goes up, they are taking a cut, and so you have to pay the government back on their equity and with the capital appreciation. I mean, they are basically riding on your decision to buy your own home and it is for 10,000 people, and so you will be going along to an auction, and there will be someone who is bidding against you, and they will be bidding with the government and you will be bidding on your own, so, I don’t think Labor have thought these things through*.
We have seen these things. We have seen their health policies that were not costed and other policies in this campaign full apart after about 24 hours. The aged care policy fell apart after 24 hours of their budget in reply.
The problem with Labor – this is what happens when you have not done budgets and you have not held a financial portfolio like Mr Albanese – you don’t know how these pieces go together and you don’t think them through and that is too big of a risk for Australians to be facing with the many pressures that are on interest rates, and cost of living, and it really is a choice about who do you think will be able to better manage those very significant pressures in the years ahead? A government that has taken us through the worst crisis we have seen in a three generations or a Labor party that does not know how to manage money?
*The same could be said of the government’s first home owner loan guarantee.
Q: Just on that, you had a similar idea of a government or a private equity scheme in 2008. What has changed between now and then for you to be slamming Labor’s policy?
Scott Morrison:
I had no plan for the government to own people’s homes. Shared equity schemes have been around for a long time and some people choose to do them in the private sector. During the global – global financial crisis there was a squeeze and there was a focus on a Bendigo Bank because of the lack of liquidity in the debt market that was enabling them to provide the products they wanted to provide and the people by providing and seeking. So, that was a very different set of issues.
‘It’s always hard’ to buy a first home says Scott Morrison
Given house prices, is the “great Australian dream” of owning your own home dead?
Scott Morrison:
Absolutely not. Absolutely not. It is hard to own your first home but last year, 164,000 Australians did.
They bought their first home. Now, when Labor was last in office. In the last year, there were 91,300 Australians who bought their first home, and under our government, and to be home guarantee scheme, under the HomeBuilder scheme, under the First Home Super Saver Scheme, two of those schemes Labor opposed.
We have ensured that 200,000 Australians over the last three years have been able to get into their first home, or into their own home, at a time when it has been hard to do so. So, no.
About two-thirds or thereabouts, it moves around, about two-thirds of Australians either own their home outright or paying it off through their mortgage. It is always hard.
If you talk to the people I was talking to before, they were talking about when they bought their first home. It has always been hard and it is hard particularly today but what the figures show is that 164,000 Australians last year getting into their first home – that is up almost 70,000 on what Labor was achieving when they were in office, and it is – I’d say – even harder now than it was then, but because of the targeted support and be well-designed policies that we have put in place we have been able to help them do it, and we have done it in a way where they own their own home.
Labor has a plan where they want the government to own your home, it’s not only that, you are last in line when it comes to your home. The bank has the first call over it. The government has the second call over it, and you come last when it comes to your own home.
See, when you design these policies you need to understand the housing market and you need to understand the economy, and you need to understand the banking and financial system and that is how you can run a plan and programs as we have had that has seen over 300,000 Australians get into their own home – not one that the government owns.
Scott Morrison has previously supported schemes like this, including when Victoria floated it five years ago.
Scott Morrison is now doing that thing where he states things as if they are facts.
He says Labor “does not have an economic plan”. Labor announced its economic policy last week.
