Well. Thank you so much, Mike, for that really kind introduction.
Mike, you meant to stay up here so I can shake your hand my friend. Shocking to see Mike Zorbas forgo a minute on the stage. It's wonderful to be with you all, and I want to start by acknowledging that today we're on Wurundjeri land.
The Wurundjeri people were the first custodians of this land. I acknowledge their enduring connection to it, and acknowledge any First Nations people who are here with us today. I want to thank the Property Council and Stockland, the sponsor of this event, and I want to thank Carmel and Mike for their very generous welcome and invitation to address you.
I'm going to talk to you today, of course, about housing policy, and in that conversation, we're going to be focused on big numbers and lots of bureaucracy and technical names for things that occupy your attention and mine, but it's really important for us to remember the foundation of the task that we're doing here.
We're here because housing is pivotal to the lives of Australians. I took on the housing portfolio almost 2 years ago, at the peak of a housing crisis that's been building in our country for 40 years.
This is affecting today, millions of people who live in Australia.
It's affecting a generation of young people who will look you and look me in the eye and tell them that they are close to giving up on the dream of one day owning their own home.
It's affecting a nation of renters who are dealing with a fundamentally different rental market than the one I was in my 20s and the one my parents were in when they were in their 20s.
And of course, we see the most devastating effects of what's going on in housing in our country, in our streets and suburbs, with a distinctly rising number of people who are actually falling out the bottom of the market altogether.
So I share that with you, because in housing conversation, we can get right into all the policy detail. But I want you to know that you and I are working on something that has enormous meaning and purpose.
We are making huge progress on the task ahead of us, and we've got a long, long way to run yet.
Today, I want to talk to you about 3 things. I want to give you a clear picture about where the Albanese government is up to in implementing what is unquestionably the boldest housing agenda the Commonwealth government has had in Australia for 70 years.
I want to talk to you about some of the work that we've done together since the Economic Reform Roundtable, where housing and red tape and issues that are holding you up was one of the central elements.
And I want to talk to you a little bit about what's coming next, because, as I said, there is a lot more to do.
Let me start with a quick refresh on the work of the Commonwealth in this critical area since the post‑war period, effectively, the Commonwealth government stepped back further and further away from the task of housing Australians, and that reached a zenith under the Abbott‑Turnbull and Morrison government.
Where you remember that for most of that period of 9 years, there actually wasn't a Commonwealth housing minister.
The Commonwealth had said, this is a problem we're going to let the states deal with and the Commonwealth will not take responsibility.
This completely changed with the election of our government in 2022 and since that time, we have put together a $45 billion agenda to tackle the housing challenges facing the country, and it's focused on 3 big things.
The first is, we've got to build more homes. Second, we're trying to get renters into a better situation, and the third is that we're trying to help more Australians into home ownership. So let me start with home building.
One of the boldest things that the Commonwealth has done here is try to actually get the whole country coalesced behind a national target, and that's contained in something called the National Housing Accord.
This is an agreement that Anthony Albanese led with state and territory leaders, with local government and with you in this room to try to say, what is the boldest ambition that we could set for our country to build over 5 years, and set that target at 1.2 million homes.
Now the government deliberately decided to be ambitious on that one, we didn't do what many other governments would have done and set just a target of what we would have built in 5 years anyway.
That's because the kind of change that we're trying to achieve in housing is not going to be achieved by continuous, tiny, incremental reform.
We're trying to achieve a change for the system here, and bring about a situation where, really, for the first time in decades, the 3 levels of government and industry are all focused on the same thing. And Mike from the Property Council has spoken quite openly about the transformative effect of setting this target. Already, we have seen this lead to dramatic changes.
Something else that's important to us on home building is seeing the Commonwealth resume its role as building homes ourselves. Many of you will remember or have read about in the post‑war era, the Commonwealth government actually rolled up its sleeves and got involved in building homes for people who needed extra support.
Well, we're back in that game. Fifty‑five thousand social and affordable homes that are desperately needed for our country. I talked a little bit about homelessness when I opened the most important thing that we can do for rising homelessness in our country today is build more social housing for people who are without a roof over their head.
We're also working with the states and territories to deliver an additional 100,000 homes that are reserved just for first‑home buyers. I want to spend a little bit of time on this policy with you, because we are actually starting to get some real traction on implementation. We struck 2 deals with the ACT and Tasmania over the last few weeks.
So on the ACT side, that's to unlock 5,000 new homes. And in Tasmania, 4000 new homes. And there is more to come on this in the coming weeks.
What it does is help build the kind of boring but important parts that are holding us back from delivering the housing that's needed. It's the water pipes, it's the electricity, it's the footpaths and roads. The reason that we have put that policy in place, really, is because of discussions we have had with you in industry.
One of the things I really want to acknowledge I've heard from you in the time that I've been minister, is that one of the main things you're confronting is just basic feasibility challenges, projects that might have got off the ground in the economics of housing and construction 7 or 8 years ago, some of them can't be built today because of a whole range of reasons.
Now, the most powerful thing that the Commonwealth can do about those problems is come forward with big investments like this, $10 billion is a massive amount of money that will be spread around the country.
Just some examples, in the ACT we're investing to relocate overhead high voltage power lines in West Belconnen that'll support about 400 homes. In South Australia, we're investing in water infrastructure in the Northern Adelaide growth corridor that'll support about 14,000 new homes.
So it's the feasibility challenge, but we're also addressing something that I know is of great irritation to those of you who are using the housing system, and that is this perverse impact of the first developer having to pay for a much larger share of the overall infrastructure costs of which developers further down the line get to benefit.
But with this policy, we're actually supporting you with those costs up front, so everyone shares. Now I don't want to forget our very important home ownership agenda.
As you know, we expanded the 5 per cent deposit program last October, this is a major change to the way that we support first‑home buyers in our market, and this year is the first year that the majority of first‑home buyers who are in the market at auctions are there with the government standing behind them and backing them in we have now helped almost 250,000 Australians get into a home of their own through this policy.
And I don't care what your politics is, that is a massive number of people to have supported in the 4‑year life of our government. Now we are making some really important progress, but don't worry, no one understands better than me that we have got a hell of a lot more work to do.
We've seen building approvals increase 3 years in a row, and our latest figures were up 14 per cent on where they were same time last year. We've seen building commencement, commencements at their highest level in over 4 years. And right now, the number of homes under construction is at the highest level.
It's been in almost 3 years, but we're also operating in a really tough global environment. The State of the Housing System report was released today, and I know you're hearing a bit later from Sue Lloyd Hurwitz, who is the chair of the Council that wrote that report. I want to talk to you a little bit about some of the numbers of what their assessment is of the impact of the conflict in the Middle East.
So I think, firstly, good news prior to the conflict in the Middle East, we were seeing some really fantastic and encouraging numbers coming out of the market. In fact, right before the conflict, the National Housing Supply and Affordability Council were forecasting a 40,000 home uplift on how we were tracking against that 1.2 million homes target.
So they were projecting that based on where we're at right before the conflict, we were going to build 980,000 homes over the 5‑year period.
But of course, global instability is going to affect that. We've got supply‑chain pressures, and we've obviously got real impacts on Australians here at home. So in the report that's been released today, the council modeled 2 main scenarios.
They looked at a short‑term scenario, which assumed that the sector faced a 6 per cent peak in construction costs in the middle of the year. That would result in a 10,000 fewer homes built to mid‑2029 which is the end of this five‑year Accord period.
They also modeled a prolonged scenario, which assumed that the sector would face the 10 per cent peak increase in construction costs in the middle of the year, and that would result in 33,000 fewer homes built to mid‑2029 so obviously, we can't hide from the fact that the conflict in the Middle East is having an effect on every part of our economy, but especially those that are large users of diesel in particular, fuel generally, but diesel in particular.
And of course, you all know that construction falls under that banner.
I've been working really hard with the Property Council, with other leaders across the sector to try to support you in any way that we can and we continue those conversations.
The one most important thing I know the Commonwealth needs to do is make sure that we are doing everything we can to secure fuel for the sector and so we can continue to build homes.
And I hope you see the government's efforts on that, not only securing 400 million litres of additional diesel for Australia, that halving of the fuel excise, the cutting of the heavy road user charge and support for small businesses, you see the Prime Minister and the Foreign Minister, you know, going overseas, meeting in person with other global leaders to make sure that when countries that we deal with are thinking about where their fuel supplies will go that Australia is at the front of the queue.
One final thing, I'll just say, on the Middle East, and very happy to go into this further with our questions, is the sector is coming at this from a much stronger foundation than I think construction was at in the post‑COVID years.
We saw when we're when we arrived in office, construction costs were increasing at 17 per cent a year in 2022.
More recently, that number is actually below inflation, seeing it closer to 2 per cent so that matters a lot. It doesn't take all the pain away, but we are in a stronger position to respond to what's coming at us.
Let me turn now to the Economic Reform Roundtable.
So for those of you that aren't following this as closely as others, in September last year, the Treasurer convened a roundtable to look at how we are going to confront what is a very obvious productivity challenge facing the country.
And for those of you who are you are working in construction, you really see how this affects the work that you're doing. So one of the main outcomes of that discussion was a commitment to tackle red tape holding back housing supply.
I, as you know, am a Labor politician, and it's not all that common that you have Labor politicians railing against red tape and regulation.
I absolutely believe there is far too much red tape and regulation in housing, and that if we are going to support you to build the homes our country needs, we're going to have to wind that back. It is just madness, partly coming from the fact that we've got 3 levels of government involved here.
And from the regulator's point of view, you know, they're putting in place rules that all make sense on their own. What we miss often is what things are like from the user perspective, when they face back at that system and see this absolute thicket of rules and regulation which are offensive, essentially stopping you from building the housing we need.
And when I talk to builders, they will literally say to me, we feel like the government never wants us to build another house again.
And let me tell you, the exact opposite is the truth.
So one of the things that the Commonwealth has a degree of control in here with the red tape and regulation piece is on the National Construction Code.
One of our focuses coming out of that roundtable was to implement a reform of the National Construction Code and try to assist builders in using what is become an incredibly complicated and very unwieldy document.
In practice, this is not just unwieldy and complicated, it is very costly. Tens of thousands of dollars of compliance cost for each apartment built in this country, 600 pages of state and territory variations with different rules for swimming pools and pipes and ramps depending on your postcode. And we've got manufacturers, manufacturers who are trying to help us be more innovative in the housing we deliver.
And waiting 10 years to get new products and methods embedded seamlessly into the code. It's not working, and we are working with the states and territories to try to fix it.
So today, the board that's been reviewing the NCC and helping us understand how we can make this a better document for you, has given us their main priorities as to the directions they want to take this work.
And I want to just explain what each of those are. The first thing they've told us is that we desperately need to simplify it.
So, we're going to remove barriers to the use of the NCC and make this seamlessly work with AI tools, which is about the biggest no‑brainer I've ever seen in public policy.
This document is begging to be made usable for AI but in its current form, it isn't working.
The second is recommitting to a national market, one of the main reasons we have seen such a build up of complexity in the National Construction Code is because increasingly states and territories are adding their own variations into that code.
The third is a tougher and more rigorous cost‑benefit analysis and decision making about what gets put into the code. And if I can translate that into plain English, we've created a governance system for this code where all the incentives are to continue adding into it without a clear direction, to simplify and take things out of the code as we go through the process of making housing higher quality across our country.
The fourth is enabling innovation and new products, and lastly, reducing the cost of compliance by trying to better calibrate compliance requirements with the risk of different building types.
Now the National Construction Code is a very complex document. For those of you who use it in this room, you will be aware that it is very important as a country that we build safe housing, that we build durable housing, and that we build high quality housing, and that over time, we lift standards. That's how we make housing better across our country.
But the way that this code has been managed has not been done particularly well, and we are going to work across this year to try to clarify exactly what we want to change about the code, and I will bring that to state building ministers in the later stages of 2026 so that'll be a big focus for the next few months.
Something else that came out of the economic reform roundtable was the EPBC Act. So this is the big environmental laws that the Commonwealth places over new developments, largely on greenfield sites.
We've known these laws haven't been working for many years, and they've went blank. They've just stopped housing developments that absolutely should have been able to go ahead. We did 2 things in the Economic Reform Roundtable.
The first is double down on building a better system for how the EPBC should work and how the Commonwealth should engage with the states on environmental law. But the second was to fast track this very large backlog of housing applications that was just sitting in the environment department.
We said that we would track to approve or deal with applications for 26,000 homes, and we've just ticked over 20,000 homes.
So we're pretty pleased with the progress that's been made there. And that includes some big projects.
One thousand lots in Ellen Grove in Queensland that were assessed in just 18 business days, and 741 lots in Rosedale that were approved in just over 2 months.
What I will say about the EPBC is a lot of you use our systems of regulation in this country.
What's in the law matters tremendously, and that's very important, but something else that matters, what is the culture of the departments?
And what I'm really seeing at the Commonwealth level is that very strong pro‑supply message that you get from me, that you get from Jim Chalmers, that you get from the Prime Minister, that is very much filtering down into the way that our departments are managing issues that affect housing.
Let me talk a little bit about next steps.
So when it comes to housing, we have some important overlays of regulation at the federal level, but probably the biggest and most important are the EPBC and the National Construction Code.
Most of the regulations that affect the work that you do in building homes for Australians actually sits at the state and local level, and you heard from the fabulous Danielle Wood just before.
The Productivity Commission has estimated that regulations add about $200,000 to the cost of a new homes. $140,000 of that is from state planning rules, from zoning.
Now, I'm very fond of saying there's no silver bullets in housing. I've been Housing Minister for over 2 years and I've been looking for them every day.
They really do not exist. But if there was one most powerful thing we can do about the long‑term capacity of our country to build the homes it needs, it is state planning reform, radical, big, visionary estate planning reform.
I care about this a lot because it is holding us back from building the homes we need.
It is also stopping us from building the cities that Australians deserve when we see zoning systems that don't work properly, the inevitable result is people getting pushed out onto the urban fringe and that creates cities of haves and have nots.
It creates cities where a lucky few live in low‑density inner‑city neighborhoods where they have fabulous schools and great kindergartens and beautiful parklands that have been built up over potentially, you know, more than 100 years, and then we have really working‑class families who don't have choices, who are pushed out to the fringes of our suburbs.
It's not good for society. It's not good for cities and it's not good for housing.
So increasing density in our inner‑city suburbs, in our inner‑ring suburbs, here in Melbourne, but all over the country, isn't just a question of planning or esthetics. It is a question of fairness and the kind of Australia that we want to live in.
Now we've seen some fantastic planning reform happen in Australia since the time I've been Housing Minister, I'm really pleased with the work that the states are doing.
In fact, we've had planning issues in Australia for decades.
The kind of reform that we're seeing happen in New South Wales, Victoria, South Australia, in WA, this kind of planning reform would have been unthinkable 5 years ago and certainly 10 years ago. So we are making big progress here.
Planning reform does not deliver you turnarounds in housing outcomes overnight, but I'm sure many of you know the evidence in the long run, this is the biggest and most important lever that we have, and I'm very supportive of our states.
That gives you a little bit of an overview of where we're up to in delivering this transformative agenda for the country, and I hope you understand from the work that we've already done together that I have aspirations that are very high for the kind of change that we can make here. There is lots of bad news in housing.
It's not hard to find an Australian who's in some kind of housing distress, any young person that you talk to just about has got their own personal story about the important effect this has had on their ability to live the life they want in our country.
But we've got to mark the progress as we're making it. One thing that I'm really pleased about is that for the first time in that 40‑year period where we've had this mounting housing challenge confronting the country, we've got every level of government striving towards the same thing, and every level of government working on the problem that matters most, and that is we have a 40‑year‑old housing crisis in our country, because for 40 years we have not been building enough homes.
And there's only one answer to that problem. We've got to work together, build new partnerships and get housing built wherever we can.
Thank you so much.
