As you travel around the Coast today the evidence of our successful local economy is everywhere. The cranes and hi-vis vests of construction sites all over our region attest to the income and the jobs being created in our community right now. But I have lived on the Coast for 26 years, and I was involved in the construction industry for three decades, and I know how quickly that boom can turn to bust. I believe that there is a great threat to our economy on the horizon which could see a lot of our hard work undone in the years to come.
With a Federal election coming next year, there is a real possibility of a Labor Government led by Bill Shorten. As Mr Shorten has repeatedly stated, one of the first policy priorities of a Labor Government would be to end negative gearing and halve the capital gains tax discount on housing. These two policies would act together to make it much less attractive and worthwhile for Australian families to buy a house. They represent in effect a significant new tax on property, which if allowed to be pushed through by Mr Shorten, will have a terrible impact on our region’s success.
Here on the Coast we have thousands of young people, just like my own daughter, who have recently bought their first home in one of the new local developments at Aura or Harmony. In total, more than 82,000 Sunshine Coast families have bought a stake in our community and own their own homes. Thousands more of us own an investment property nearby, renting it out to help to support our retirement or provide for our children’s future. Make no mistake, if Labor abolish negative gearing and halve the capital gains tax discount then the value of every one of these homes will go down.
Sometimes economics can be complicated, but on this issue, it’s pretty simple. If you make it less worthwhile and more expensive to own a property, then fewer people will want to buy one, and it will be harder to get the price you want when you are selling your home.
If you own a property on the Sunshine Coast, under these disastrous Labor policies it will be worth less.
But it isn’t just home owners who would be punished by these changes. Over 37,000 of us here on the Coast rent their homes. Many of those who rent are young, or don’t have a great deal of money left over at the end of the month as it is. Without negative gearing some landlords will have to raise their rents to cover the cost of their properties, while the total number of rental properties available will stop growing to match our rising population. One way or another, if Labor are allowed to end negative gearing, many of these 37,000 Sunshine Coasters are going to see their rents rise just when they can least afford it. For self-funded retirees, doubly impacted by Labor’s proposed Retiree Tax, the effect could be catastrophic.
As Construction Skills Queensland have shown, for all of us, construction and development on the Coast adds a critical $3.5 billion to the local economy. Directly and indirectly it supports thousands of local workers. If we can protect the industry from Labor’s destructive policies, that contribution is expected to grow by another 15% by 2021. In fantastic news, apprentice training rates in our community are at an all-time high.
But what are all of those young and skilled apprentices going to do for work if the construction industry on the Coast is decimated by Labor’s property taxes?
If Labor are allowed to make it less worthwhile to buy a property, as they plan to do, then fewer properties will be constructed. Once again, it’s not hard to see why. If fewer people want to buy a home, and they are willing to pay less, then fewer homes will be built. Master Builders Australia have shown that across the country 42,000 fewer homes in fact would be built as a result of Labor’s policies. The same analysis suggests that 32,000 jobs would be cut, and the economy would take a $12 billion hit. SQM Research Modelling released this week even suggests that it would cause Australia’s first recession in 27 years. As one of the fastest growing regions in the country, with construction at the heart of our economy, the Sunshine Coast would be hit far harder than most and the Labor party know it.
I was a carpenter in the building and construction industry myself, and I always tell the many apprentices I meet that they have a bright future ahead of them. I tell them that if you work hard, an apprenticeship in the construction sector on the Sunshine Coast will give you a great income and a career to be proud of. I want to be able to go on telling them that in the years to come, but faced with the prospect of Labor’s industry-destroying policies, it is getting harder to be optimistic.
Bill Shorten and the Labor Party need to listen, admit that they have got this one wrong, and ditch their devastating property taxes. Whether you own your home or rent it; whether you want to invest in your family’s future or are looking for a job in our region, these policies are going to hurt all of us on the Sunshine Coast. We need to ensure that Labor does not get the chance to implement their job and wealth destroying plans.
Andrew Wallace MP
Federal Member for Fisher
First published in the Sunshine Coast Daily on 17 November 2019.