Gladys Berejiklian ignored advice from her own Treasury officials that highlighted how negative gearing reform could help tackle housing affordability in NSW.
A briefing note on housing affordability was prepared by NSW Treasury officials for Ms Berejiklian, who was NSW Treasurer at the time, for a Council on Federal Financial Relations meeting on 2 December 2016.
The note obtained by the Labor Opposition is labelled cabinet-in-confidence and says there are “Commonwealth Government policy levers that could contribute to the improvement of housing affordability” before going on to list negative gearing reform and capital gains tax discounts as the top two measures.
Federal Labor’s policy is to limit negative gearing to new housing and halve the capital gains discount. This week it was revealed that for political expedient reasons the Turnbull Government overstated the impact such reforms would have on the housing market.
Despite the Treasury advice, Ms Berejiklian has ruled out advocating for negative gearing reform, more often than not saying she had yet to see the evidence it would improve housing affordability.
The briefing note went on to spell out the economic and social implications of prolonged low housing affordability, such as:
- Skilled workers going to live in other more affordable states;
- An increase in the demand on social and affordable housing as more people rent;
- An erosion in financial security as fewer people invest in property and rely more on the state for payments through old age; and
- An increased risk of entrenching poverty and disadvantage in society.
Quotes attributable to Shadow Treasurer Ryan Park
“This advice clearly highlights what Labor has been saying all along - that the NSW and Federal Coalition Governments have been completely misleading the community when it comes to implementing policies to address the housing affordability crisis.
“The NSW Premier and the Treasurer should be ashamed of themselves for letting down NSW first home buyers by refusing to advocate for negative gearing reforms that proposed by Labor to help first home buyers, particularly in Sydney, get a foot in the door.
“When it comes to addressing this crisis the NSW Government has simply done too little too late and first home buyers will pay a hefty price for their inaction.”