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Event: Denita Wawn interview with Karalee Katsambanis, 6PR
Date: Tuesday, 12 September 2023
Speakers: Karlee Katsambanis, host 6PR Money News; Denita Wawn, CEO Master Builders Australia
Topics: Master Builders Industry Forecast; Housing Accord; Industrial Relations
E&OE
Karalee Katsambanis, host 6PR: Now, as we know, coming out of Australia yesterday was the big news that the Government’s Housing Australia Future Fund also known as the HAFF will pass Parliament with the support of the Greens. Now with housing supply being a crucial part of the national conversation at the moment. The legislation was looking like defeat. The Greens were digging in for the need for rent freezes or rental caps as part of that support but ultimately one could say cooler heads have prevailed. The $10 billion fund will set about constructing 30,000 new and affordable social homes in the first five years of the fund. Now the Greens did secure a small win though with the Government agreeing to provide an additional and immediate one billion dollars towards the fund. So the law will likely pass. More homes are going to be built. But the question is, what does the industry think? I’m delighted to join the show this evening Denita Wawn the CEO of Master Builders Australia. Good evening, Denita.
Denita Wawn, CEO Master Builders Australia: Good evening and thank you for having me.
Karalee: You’re very, very welcome. Now, I’ve got to ask you Denita. A bit of politics is still to happen before this legislation becomes law but I guess ultimately you must be pretty happy with the outcome.
Denita: Yes. Master Builders Australia has been advocating for the part of the federal government’s housing policy that they have been seeking to pursue since they got into government last year. It’s a missing piece of the puzzle in ensuring that we’ve got ongoing support for social and community housing. It is a start to resolve the housing crisis but it is only a component of it. So, well done, not only to the federal government but also to the Greens and some of those key crossbenchers that support it. Finally, we will see this legislation through by the end of the week.
Karalee: So, got to ask you. I mean here in Western Australia, it’s all good news but currently it’s going to take at least three years or more for a house to get built here in Western Australia. How likely is it that we’re actually going to get close to this government’s National Housing Accord target of 1.2 million new homes in the next five years? Especially Western Australia’s portion of it when you can’t get people here that, you know, have been waiting for a long time to get their house built already.
Denita: You’re spot on. We’ve had massive issues in the industry, particularly during COVID, where we’ve had strong demand, difficulty in resourcing at local government level, shortages of materials and shortages of staff. So it’s really created a massive problem. We’re starting to see the end of that and the actual issue is at the moment we’re seeing a significant decline in building approvals because of those interest rates continuing to climb meaning people feel unsure about actually putting money and investing money into a home, borrowing that money, when they’re not quite sure how much they will be spending. So, we think it is important that we also have government investment. But the key issue for us is about workforce. We’ve estimated that in the next five years to meet all of the targets the Housing Accord has stipulated we need an extra 500,000 people into our industry over the next five years. And that is, given that we’ve got 1.3 million in the industry is a large target. About 300,000 of that is replacement for people exiting the industry and another 200-odd thousand new jobs to meet those key objectives of a million to 1.2 million homes to ensure that we house all Australians. It’s a big part but at least we’ve got a target and at least we’ve got commitments from governments of all persuasions to see if we can achieve that.
Karalee: Denita, Master Builders Australia, you’ve released some forecasts today. I want to get on to Western Australia’s portion of it in a minute but I also want to ask you, do you think the Government actually understands the pressures in the property industry? I mean, every second day here in Western Australia there are stories in the paper about building companies going bust, customers just left completely out of pocket as well. I can see you industry probably facing challenges such as more builders going broke, cowboys coming into town that aren’t qualified, soaring construction costs, increased interest repayments, record high taxes including land tax, high insurance costs and perhaps a slowdown in the local economy. It’s a lot to deal with and I know what you’re saying that, you know, it would be great if there’s another 500,000 workers coming into the construction industry but it also opens the door to even more problems.
Denita: Absolutely, and these are things that we need to address collectively as an industry through the entire supply chain as well as all governments. Let’s tackle the industry contribution first, it is absolutely critical that as an industry we expect good practice of all of our members and the industry at large. We’ve just released our sustainability goals which talk about the viability, and sustainability of the industry and we argue that it is unacceptable that if anyone, any business in our sector is doing the wrong thing that jeopardises the viability of others. So we say that regulators have got to stand up and make sure people are compliant with existing laws as opposed to the law makers simply throwing more laws onto the good operators that are trying to do the right thing but get hamstrung by more and more regulation. So that’s really a fundamental point I’d like to make. I think the next point is the government, generally federally, understands the industry, they understand the pressures. I’ve been really impressed with the Treasurer, the Housing Minister, the Immigration Minister, all understanding what issues that we are facing and they are trying to assist us. The only concern that we’ve got that is really actually counterproductive to what we are trying to achieve is Minister Burke on industrial relations. He has put in a Bill that is nearly 300 pages long that will decimate the independent contracting model that we have successfully implemented as an industry over a long period of time. And so, our concern is that while government is trying to do the good thing in one area they have Ministers that are trying to pull apart the industry in another. And that issue has just got to be addressed straight away and immediately.
Karalee: And look, I’m sure listeners this evening, you are probably nodding along with Denita Wawn as well. It’s something that we’ve spoken extensively on Money News. You can always give me a ring 13 38 82 or you can send me a text 0487 999 882. Perhaps you actually work in the construction industry and you’re resonating with what Denita Wawn who is CEO of Master Builders Australia is saying. I said earlier that you have released some forecasts for the next few years with regarding the Housing Accord. Can you share with our listeners what’s in it for Western Australians?
Denita: Well, some good news, I think but there’s also some challenging news. We are going to see a stabilisation of those numbers over the next two years but the really exciting opportunity is some increase in activity, building activity for the industry in Western Australia from about 2025 onwards. That’s going to provide huge opportunities but equally some challenges. I think that’s good news for the building industry in WA. They’ve really felt the brunt of difficulties in trying to meet all of that demand and making money out of it with rising costs and so we want to give them some good news. And I think the forecasts show that while it will dip a little bit in the next few years it will stabilise, give them an opportunity to regroup and then look at the exciting opportunities for an extension of the building activity in Western Australia. And I think it’s interesting, this will provide an opportune time to talk to the Western Australian government about the planning laws, about medium density, about high rise and also about the ease of access to building generally. We know that delays have been a significant contributor to that headache and I think it’s really important that we acknowledge that National Cabinet agreed the other day that money needs to be given to local council to actually see if they can speed up those approval processes.
Karalee: You took the words right out of my mouth. I’ve also had things in the newspapers over the weekend, the fact that Western Australia doesn’t have an effective building commissioner unlike other states, so I think that’s something the state government has to get on as well. Denita, it is wonderful that you have joined me this evening. I really thank you for your time. We will check in again with you soon but as I said you have provided some great perspective for our listeners this evening.
Denita: A pleasure and thank you so much for taking the time to be interested in this issue.
Media contact:
Dee Zegarac
National Director, Media & Public Affairs
0400 493 071
dee.zegarac@masterbuilders.com.au