Building Industry

The Hon. F. PANGALLO (15:06): I seek leave to make a brief explanation before asking a question of the Treasurer regarding the building industry.

Leave granted.

The Hon. F. PANGALLO: The Master Builders Association of South Australia has raised concerns about the state of the state's building industry. ABS figures on building approvals in South Australia show that, while the decline in building approvals has ended for the first time in 14 consecutive months, only 621 homes were approved in December, only a slight increase of four homes on the previous month. In December 2017, there were 94 more approvals: 715 for the month. However, only 15 per cent of these latest approvals were for first-home buyers—the worst of any state or territory.

To boost the sector, the MBA wants a stamp duty exemption for first-home buyers building their first home, similar to New South Wales and Victoria—except their exemptions include all homes—and the removal of a requirement to have a rainwater tank installed in all new builds like Queensland did in 2013, which the MBA has calculated will save the average first-home buyer about $25,000 of the cost of a new build.

My question to the Treasurer is: given the current crisis, what is the government currently doing and what is it planning to do to support the state's building industry? Will the government support the Master Builders Association of South Australia's proposal of stamp duty exemptions for first-home buyers building their homes and scrap the regulation requiring rainwater tanks? Will the government commit to investigate the feasibility of making first-home buyers building their home exempt from stamp duty?

Will the Treasurer support a call for its new Productivity Commission to review negative factors like inefficient land release strategies, excessive development levies, taxes and charges, and excessive planning and building requirements which drive up house prices by 40 per cent. Does the government believe that boosting the First Home Owner Grant to $20,000 in regional Australia, which would be up from $15,000 presently, will be a positive initiative?

The Hon. R.I. LUCAS (Treasurer) (15:09): I thank the honourable member for his question. The new government always treats the views of stakeholders with due respect, and we of course have and will continue to treat the views of the Master Builders Association with respect as well. I had a number of meetings both before and after the election with the Master Builders Association. They did put the proposition in relation to stamp duty relief for first-home builders to both the former Labor government and to the then Liberal opposition prior to the election. Both the former Labor government and the then Liberal opposition made no commitment or promise to provide stamp duty relief for first-home owners in that frenetic period leading up to the March election last year.

So the new government made no commitment in this particular area, as was the position of the former Labor government as well. That remains the policy of the new Liberal government. I have a meeting coming up with the Master Builders Association in the next couple of weeks, and I will listen respectfully to their position in relation to this area, but the government's position is that we have no financial capacity to provide any more significant financial relief at the moment.

We are trying to turn around the state's economy after 16 years of financial mismanagement and negligence under the former Labor government. We committed at the election for significant tax and fee relief: a $90 million a year reduction in ESL bills, which we implemented in July last year; a $40 million to $50 million a year reduction in payroll tax, that is, the abolition of payroll tax for all small businesses from 1 January, which we have implemented already; and, a commitment to reduce land tax from June of next year at around about a cost of $40 million to $50 million a year, which we have legislated for and which will be introduced.

So in those significant areas we have committed to tax and fee relief in an endeavour to try to generate economic growth and jobs growth in the economy, but we did not commit to the particular stamp duty relief that the Master Builders Association lobbied for before the election and continues to lobby for now.

In relation to the second area, it is not within my portfolio responsibility to be able to exempt builders from the requirement for rainwater tanks. That is, I suspect, probably more likely to be in the area of minister Stephan Knoll, but I am happy to take up the issue with the appropriate minister and see what, if any, policy response the government might have in relation to that.

In relation to the third general area, which was the Productivity Commission: we have already instituted a Productivity Commission inquiry in terms of government procurement, which touches in a small way on some of the issues that the Master Builders and other stakeholder groups have raised, and we would see some potential benefits for businesses and industries from that.

In relation to whether or not the Productivity Commission might undertake a further Productivity Commission review, or a number of reviews, in the areas that the Master Builders have raised, I think the government certainly would be interested in those sorts of areas, because that is what the Productivity Commission was implemented for, that is, to reduce regulation, to reduce red tape, and if it can be done in an area such as this, which might help drive down the costs for home builders and, therefore ultimately, homebuyers, obviously it would be a good thing. So certainly that would be something the government would be interested in, with further consideration and discussion with the Productivity Commission. I am sure the Premier would be interested in considering, at an appropriate time, something in that particular area as well.