Doorstop Parliament House – Productivity Commission Housing Report

Event: Doorstop, Mural Hall, Australian Parliament House
Date: 17 January 2025, 9:40am AEDT
Speakers: Denita Wawn, CEO Master Builders Australia
Topics:  Productivity Commission report into housing; interest rates; housing crisisE&OE

Denita Wawn CEO Master Builders Australia: Denita Wawn, CEO Master Builders Australia. Today’s Productivity Commission report into housing is sobering reading, but it reinforces what the industry and Master Builders Australia has been saying for a long period of time, that our housing crisis is a result of significant barriers to supply. This is around productivity has been declining significantly in our sector for decades, that we are constrained by red tape, that we don’t have enough people, and we also have got declining investment in the industry as a consequence. We will simply not resolve this housing crisis in Australia until we respond to the supply issues that have been highlighted today by the Productivity Commission. Enough is enough. There’s been a lot of talk, but we have a federal election around the corner, and 70 per cent of Australians think that the federal government needs to lead on housing issues. So despite the fact that many of the issues addressing the housing crisis are in fact the responsibility of state governments and local government, Master Builders Australia calls on all political parties in the lead up to this federal election, that the housing crisis and their policies to resolve the housing crisis must be their priority for this coming election. We need to resolve these supply constraints so we can get on with the job of building for all Australians.

Journalist: What can the federal government realistically do?

Denita: Well, we know that the federal government, first and foremost, has issues around skills, around migration, around apprenticeships, and that is why we have consistently argued to say we need more skilled tradesmen in this country. We need more people that are actually going to build our homes. And the system currently is not designed to ensure that we get the right migrants into this country that meet those skill demands. We need more support for apprenticeships. Yes, we’ve seen some announcements recently that help in this area, but likewise, there has been nothing in terms of employer incentives to actually encourage apprentice hot spots to become available in the first place. The federal government also has the carrot and stick approach of the myriad of funding that they give to state governments on infrastructure. Enough is enough. They’ve got to start holding state governments to account when they hand over billions of dollars worth of infrastructure spending that can be connected to deregulation of our housing market. We have seen the Hilmer reforms of the 1990s where the federal government provided incentives, financial incentives to governments to make significant deregulation. We call for that to be repeated in the housing market as immediately as possible.

Journalist: The Productivity Commission also called for a full review of the National Construction Code. Would you support that?

Denita: Absolutely. We believe that the National Construction Code is simply difficult to implement. It is cumbersome, it’s constraining, and the myriad of changes that we have seen have added cost after cost. In many instances, Master Builders supports the intent behind change, but simply, governments have not been listening to how to implement those changes without adversely affecting not only our industry, but our clients as well. So certainly, it is good to see that call for a pause in the National Construction Code for us to regroup and work out what is right for this sector. And we acknowledge that the coalition has also supported that as well.

Journalist: Are there enough pathways for tradies or for new apprentices? Should there be more advertising of those pathways?

Denita: There are huge opportunities in building construction careers, and we’re very excited that today we’re actually releasing our Construct Your Career guide. It really identifies the different pathways that people can take in developing their career, constructing their career, in the building and construction industry. We have jobs in terms of entry level apprentices, paraprofessionals and university qualified. You can start as a tradie and work your way up to eventually become a builder in terms of owning your own business or CEO of a large building business. The world is a huge opportunity in building and construction, and we’d like to see more people being encouraged, which is why we’re going to be sending it to every single secondary school in Australia.

Journalist: The housing crisis we’ve seen Australia dates back decades. The Coalition was in power for much of that time. Do you think that they would be better placed to help resolve the issues we see? Or would you prefer Labor to manage this issue?

Denita: I think we, Master Builders Australia has put both major political parties on notice. It was disappointing in the end of the Morrison Government that they did not implement supply policies to resolve the housing crisis. They looked and focused on demand. So we have held both major parties to account over the last three years to say, give us your supply policies. What are you going to do to stop the constraints of supply? Now the Coalition has heard us on some areas, but not all. Likewise, Labor has heard us on some but unfortunately, they have also introduced significant industrial relations reforms that curtail some of the benefits that we see around worker flexibility and greater productivity. So there are question marks on both political parties. The housing crisis is one of the key issues that voters are looking at for this election, and we will make sure throughout the duration of the election that those parties are held to account as they release their housing policies.

Journalist: It’s widely anticipated that rates will be cut tomorrow. Are you concerned that rate cuts will see a surge in demand for building, for buying, and that will just push prices up when we have these supply issues?

Denita: Well, I think an interest rate cut, if it’s minimal, really, is insignificant in comparison to the far bigger issues that we are currently facing with the industry. When you have costs increasing by 40 per cent over the last five years, when you’ve had a situation upon which our productivity is failing, then a cut really simply won’t have a significant dent in the demand. At the moment, private investment is lagging, whether it’s mum and dad’s right through to big property developers, because they cannot see the numbers stack up. Yes, a rate cut would be great, but for us, we don’t think it’s going to be significant enough. We need to be looking not only at rate cuts but also microeconomic changes in our sector. That is where it’s critical, and that is why governments need to step up, not just the RBA.

Media contact:
Dee Zegarac
National Director, Media & Public Affairs
0400 493 071
dee.zegarac@masterbuilders.com.au