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Rudd to gazump new home buyers as part of $42 billion debt and deficit package.



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Fri, 6th February 2009

RUDD TO GAZUMP NEW HOME BUYERS AS PART OF $42 BILLION DEBT & DEFICIT PACKAGE Scott Morrison MP Shadow Minister for Housing and Local Government

Federal Shadow Minister for Housing and Local Government, Scott Morrison said revelations at this morning’s Senate inquiry into the Government’s $42 billion debt and deficit package mean Kevin Rudd will be bidding against every prospective home buyer looking to buy house and land packages, in order to reach his target of 20,000 new public housing dwellings.

“At today’s hearing officials confirmed the Government will purchase more house and land packages in existing private housing estates in the event that State and territory government agencies are unable to keep up with their construction programme,” Mr Morrison said.

“One of the biggest concerns about this programme is the capacity of State and territory housing agencies to deliver. Despite these agencies being characterised by manifest failure in almost every state and territory, the Government is going to gamble $6 billion of taxpayer funded debt that they can deliver construction of 20,000 new homes,” he said.

“Evidence in the Senate hearings demonstrated there had been no independent verification of the capacity of State and Territory Governments to deliver this programme. Kevin Rudd has basically put up $6 billion of your money on their say so.

“Given the performance of State Governments in managing our money, especially in NSW, this is simply reckless.

“Anyone with any experience of public housing authorities knows they are just a disaster, so when they fail, the scheme will ramp up the purchase of house and land packages in the private market. This will pitch the government directly against first home buyers and drive up the price, as the Government becomes increasingly desperate to deliver the new homes because they simply didn’t think this through.

“This will also blunt the effectiveness of the first home buyers grant for new projects, supported by the Coalition, as first home buyers get crowded out of the market.

“To add insult to injury, evidence at the hearing also revealed the States and Territories would not be waiving their taxes, fees and charges for things like development approval costs and transaction fees. So $ 6 billion in funds intended to stimulate housing construction will simply be used to prop up stamp duty and other tax revenues.

“The government has clearly not thought this through. They have failed to do the proper due diligence on putting these programmes together and it is the taxpayer who will be footing the bill in higher debt and higher taxes when it all falls apart. Today’s revelation highlights the prudence of the Coalition’s approach in rejecting these measures,” Mr Morrison said.