Federal election 2019: Scott Morrison’s first homebuyer policy not flagged with Cabinet

One of Scott Morrison’s biggest election commitments was rushed through without any consultation of his colleagues, it’s been revealed.

The last-minute Liberal policy to help first homebuyers didn’t go through Cabinet and had the fleetest of evaluations before being launched on Sunday, it’s been revealed.

Finance Minister Mathias Cormann today confirmed the plan had not been approved by Cabinet but had been developed “by the economic team”.

Prime Minister Scott Morrison has said it was put together over the past four weeks during the election campaign.

Scott Morrison at a housing development to spruik his first homebuyer policy. Picture: AAP

Senator Cormann told ABC radio it was a “very important policy” that had been “very carefully designed”.

However, he did not elaborate on that design work.

And there is no evidence the plan to help first-time property buyers put a deposit together was prominent in Treasurer Josh Frydenberg’s thinking when he delivered the Budget on April 2.

On Budget night, news.com.au approached Mr Frydenberg to ask if he had any improvements to home affordability that would address the problems faced by many of our readers.

He had nothing specific to say and a staffer from his office quickly moved him on.

RELATED: Experts warn of glaring issues with new first homebuyers scheme

Scott Morrison didn’t consult senior Liberals on his $500 million first homebuyer policy, it’s been revealed. Picture: AAP

Just 40 days later, the proposal to contribute to deposits needed by first homebuyers emerged as a $500 million election blockbuster.

Labor was quick to me-too on the policy after it was announced by Prime Minister Scott Morrison last Sunday, also without any detailed examination.

Both sides are referring to similar schemes operating in New Zealand and Western Australia.

But the haste has left open questions as to what effect the assistance to those saving for a home deposit might have on the market and interest rates.

Scott Morrison’s key policy was quickly adopted by Labor. Picture: Getty Images

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The proposal is for the government to help a targeted group put together a 20 per cent deposit on a home — effectively reducing it to 5 per cent — and pay mortgage insurance.

The group is intended to appeal to voters ages 25 to 34. Its political objective was to attract those younger voters, and to provide another issue from which to attack Labor’s policy to restrict negative gearing tax concessions.

It would assist 10,000 first homebuyers a year if they have incomes up to $125,000 a year for singles and $200,000 for couples.

Official figures thus week show first homebuyers make up a growing sector of the housing market with the fall in some metropolitan prices.

In March, they amounted to 27.1 per cent of the market, the highest proportion since September, 2012.

But there were sharp differences depending on locations. Real estate newcomers were 42 per cent of the Northern Territory market but 24.8 per cent in Sydney.