Editorial: PM’s housing plan gives him a chance

Prime Minister Scott Morrison has taken a big swing with a housing policy helping Australians buy their first home. But with postal voting and prepolling already underway, he may have made the announcement too late, write the Editor.

In the dying days of the campaign Prime Minister Scott Morrison has taken a big swing with a housing policy that would allow people to take cash out of their superannuation to buy their first home.

The headline-grabbing move – announced yesterday at the Coalition’s campaign launch in Brisbane – is aimed squarely at bringing in young voters in their 20s and 30s who are living in the cities.

They’re the voters who are leaving, or not even considering the Coalition, and the ones they need to win over and not just for this election.

Prime Minister Scott Morrison speaking at the Coalition Campaign Launch. Picture: Jason Edwards

It cannot win with only the outer suburban and regional vote, so this is the cohort the Coalition needs if it is to be able to retain or win back government in the years to come.

House prices have been one of the biggest issues at this election and will be a big motivator for young families and singles trying to get into their first home.

At the moment, they are effectively locked out by skyrocketing property prices.

But it’s a challenging area for the major parties to play in. While they want to remove barriers to young people getting into the market, they also want to avoid doing anything that could hurt house prices – and so angering the large swath of older voters who have already bought into the market. This policy looks like it achieves this.

In allowing people to take out up to $50,000 or 40 per cent of their super for the deposit, with no income test or limited number of places in the program, it will appeal and apply to a greater number of people than Labor’s “shared equity” scheme, which is limited to 10,000 places a year and comes with strict income eligibility rules.

Prime Minister Scott Morrison poses for a selfie at a Hindu Council of Australia Multicultural Event in the electorate of Parramatta on May 14, 2022. Picture: Asanka Ratnayake/Getty Images

But there are a range of risks to the plan. For a start, there would be reduced revenue for government as it would lose income from the 15 per cent tax on earnings from super balances.

Questions will also be asked on what it means for people’s self-funded retirement prospects and whether it will see more people end up on the pension – another cost to government in the long term. As we have seen with people borrowing from their super during the pandemic, the long-term loss by retirement day can be substantial.

But there is also no doubt it could be a “game changer”, as Mr Morrison put it, to many young families and allow them to save more over their working life by getting out of the rental market.

Prime Minister Scott Morrison joined Aaron Violi for a tour of Punt Road Winery in the Yarra Valley, as part of an announcement for support for wine businesses to boost export opportunities. Picture: Jason Edwards

But given pre-polling is increasingly popular, why has Mr Morrison left it so late in the campaign to make this pitch.

More than 2.5 million postal vote applications have been received, up from 1.5 million in 2019, while 1.6 million people have cast a vote at early voting centres.

It is Labor’s election to lose at this point. Mr Morrison will need to sway every undecided voter that he can if he hopes to retain power and every vote cast is one less he can win over.

Originally published as Editorial: PM’s housing plan gives him a chance