Liberal senator Eric Abetz says Tasmania’s housing debt should not be forgiven

UPDATED: Wiping Tasmania’s historic housing debt would be tantamount to rewarding bad behaviour, according to the state’s most senior Liberal MP.

TASMANIA’S historic housing debt should not be forgiven by the federal government, according to Liberal senator Eric Abetz.

Senator Abetz told Sky News on Tuesday that waiving the $157 million debt would amount to rewarding bad behaviour — despite the fact the annual repayments cut the state’s Commonwealth housing grant in half every year.

“The simple fact is that Tasmania borrowed money for the purposes of social housing and there needs to be repayment of that, otherwise it rewards bad behaviour by state governments,” Senator Abetz said.

“Whether we can come to some sort of accommodation to ensure people don’t suffer as a result of the bad behaviour of previous state governments, that is something I would like to explore with the [Federal Housing Minister Michael Sukkar].”

Liberal Senator Eric Abetz at Parliament House in Canberra. Picture: AAP

Mr Sukkar is expected in Tasmania on Thursday to attend an emergency housing summit organised by the Hobart City Council.

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He will meet separately with state Housing Minister Roger Janesch to discuss forgiving the debt Tasmania racked up between the 1950s and 1980s to boost its social housing supply.

The Commonwealth forgave a similar debt carried by South Australia, but Senator Abetz dismissed the comparison.

“That was by a previous Labor government to a previous Labor government, federal to state, and desperate governments will do desperate things from time to time,” he said.

Senator Abetz said one of the key drivers of the housing crisis was the red tape and delays caused by local councils for people wanting to build new homes.

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Speaker Sue Hickey lashed Senator Abetz’s comments as “deplorable”.

“It is the obligation of every federal member to be lobbying in the best interests of the people of Tasmania,” Ms Hickey said.

“What has he done to help vulnerable Tasmanians during his many terms of office?

“As a member of the Liberal Party I wish to distance myself from these comments.”

Community sector organisations have estimated it could take Tasmania until 2042 to pay off the Commonwealth housing debt.