Page 3629 - Week 12 - Wednesday, 21 November 2007
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Gary Humphries and John Howard was made that there would be no interest rises under a federal Liberal government and that our votes should have been influenced by that promise at the last election.
Of course we are an election late, to the extent that that particular promise by Humphries and Howard was relevant at the last election, and indeed it is one of those promises that will be relevant at this election as well, because as a result of that sixth interest rate rise the cash interest rate has been taken to an 11-year high. For the average mortgage in the ACT that most recent interest rate increase—that is the one just this month—increases the interest repayments for most Canberrans on an average mortgage by $52 a month.
The string of interest rate increases has had a most significant impact on housing affordability. For anybody to argue seriously that six interest rate rises, taking the cash interest rate to an 11-year high, increasing the interest rates just through the rise in November by $52 a month, does not have an impact on housing affordability or on the capacity of Canberrans to meet the full range of costs and responsibilities they have really is gilding the lily somewhat. I think it is remarkable that anybody would seek to construct a position, as Brendan Smyth is doing today, that Canberrans have never had it so good—“What are they whingeing about? Why are Canberrans complaining at the sixth interest rate rise in three years?”
Opposition members interjecting—
MR STANHOPE: The basis of the question is: “Look, what are all these Canberrans that are struggling to pay their mortgage whingeing about? They’ve never had it so good.” We have this learned leading article in the Canberra Times suggesting: “What are they complaining about? Things were worse previously. They should stop whingeing—just get on with it, suffer the 11-year high in a cash interest rate for an average size loan. Acknowledge that what’s another $400 a month; what’s $2½ thousand dollars a year?” That is the thrust of Mr Smyth’s question today. It is a significant amount of money, and that additional $400 that is being paid by an average Canberra household—the $2½ thousand dollars a year—is of course due to those six interest rate rises in a row.
Since 2004, though, to go to the analysis, house prices have grown by less than household incomes, with the effect of improving affordability. In other words, in the absence of the interest rate increases it would have been far easier for households to enter the housing market—and that is the major flaw in the Peter Martin analysis, which has been slavishly adopted by Brendan Smyth because he thinks Australians have never had it so good too.
MR SPEAKER: Is there a supplementary question?
MR SMYTH: Thank you, Mr Speaker. Treasurer, what impact have your taxation policies, specifically introducing new charges and increasing others, had on working families in the ACT?
MR STANHOPE: Our charges have perhaps had about 10 per cent of the impact of Gary Humphries’s and John Howard’s charges and interest rate increases. That is the
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