Legislative Council Fifty-Fourth Parliament, Second Session (54-2) 54 2 Parliament of South Australia Legislative Council published Question Time Homebuilder Program HomeBuilder Program The Hon. M.C. PARNELL Legislative Council HomeBuilder Program The Hon. M.C. PARNELL (15:14): I seek leave to make a brief explanation before asking a question of the Treasurer about HomeBuilder grants. Leave granted. The Hon. M.C. PARNELL Legislative Council The Hon. M.C. PARNELL: The Financial Review on Monday afternoon reported that the HomeBuilder grant scheme effectively was not operating. Under the heading, '"Frustrating": State delays hold up HomeBuilder grants', the Financial Review said: Inquiries for the HomeBuilder's grant are mounting, but mortgage brokers say they are yet to get any borrower across the line due to state and federal government delays in releasing details on how to access the money. The quote from Susan Mitchell, the chief executive of Mortgage Choice was: We haven't been able to process one successfully because the states have yet to sign up. Another quote from Susan Mitchell: Once the states sign up, then the banks will figure out how to use the grant and how it works into the loan process. But I don't think any of the states have signed up yet. It's frustrating for everybody. My question of the Treasurer is: has South Australia signed up, and when will applicants and their mortgage lenders be able to access the scheme? The Hon. R.I. LUCAS Legislative Council The Hon. R.I. LUCAS (Treasurer) (15:16): The answer to the question is: no, we haven't yet, but it is imminent, if I can use an accurate descriptor of where we are up to. The Board of Treasurers discussed the issue last evening in a teleconference, and the Board of Treasurers is the state and territory treasurers, minus the federal Treasurer. It is fair to say that some jurisdictions do have a number of issues. Whilst South Australia understands the particular concerns, we are prepared to move more imminently and quickly perhaps than some of the others. Nevertheless we accept that some of the jurisdictions are wanting to ask of the federal government whether there is a willingness to amend slightly the terms of the proposed national partnership agreement that has been put to the states. Put in its simplest form, the federal government is proposing to pay the funds, but it is requiring of the states and territories to implement the scheme and therefore to pick up the costs of implementing the scheme. A number of significant issues have been raised by stakeholders, and some have been well publicised, in particular the concern about the three-month rule, which is that to qualify for the grant you have to have commenced the construction of the new building within three months of the contract. Because of significant concerns about planning approvals, but more particularly in terms of obtaining finance, there are significant concerns that potentially otherwise eligible customers may well find themselves being refused permission for the grant because they time out on the three-month provision. We have only had the draft agreement from the commonwealth for a little over a week—it seems that it was announced months ago, but I think it was only a week to two weeks ago, or something—and in the original proposal from the commonwealth there was a very strict three-month provision. South Australia, together with a number of other jurisdictions, went back to the commonwealth and said, 'We think this is unreasonable and you may well find that the policy purpose you want will be negatively influenced by the strict interpretation you have put in the agreement.' To their credit, and I think I might have referred to this earlier this week in response to another question, the commonwealth further amended the agreement and essentially has left it back on the states to make a judgement in, I think it says something like 'unforeseen circumstances' or something, so it will now be up to the states to make that difficult decision as to what constitutes an unforeseen circumstance. We were seeking more clarity in terms of the extension of time, maybe a time period or something like that. Nevertheless, we welcomed the fact that there was some movement. There have been a number of examples like that, in terms of, 'Well, why haven't you signed the agreement we have plonked on the table within 48 hours of its being announced by the federal government?', but there have been good reasons why we have come back to them. The Hon. Mr Ngo asked an excellent question yesterday in relation to eligibility criteria. I think my colleague the Hon. Jing Lee has raised this issue with me as well, but other states also, and that is that the eligibility for our First Home Owner Grant is for Australian citizens but also permanent residents, a much broader category. The commonwealth government's eligibility says permanent residents are not eligible for the $25,000, only Australian citizens. We have said for uniformity of application of this, that is, to say to a group of people, 'Here is $40,000 now instead of $15,000,' it would make sense to make it uniform. The commonwealth government in that particular area has not been prepared to further amend the agreement. There are now significant issues being raised by some states more strenuously than perhaps we in South Australia in relation to the fact that it will now be the states and territories that have to make the difficult decision to say no to a whole range of people, given the current drafting of the agreement. If, for example, the state government was to give a grant to someone which was then criticised in the media, that that person was ineligible, the state government will be the one that will be in the firing line, because the commonwealth government will say, 'We just put the money up. It is the states who are administering the scheme. Go and speak to the state government in relation to why they gave this particular person a $25,000 grant.' The reason I raise the issue about that is that a number of the other state jurisdictions, Labor and Liberal, have raised that particular issue as a significant concern for them. One of the issues is what constitutes the commencement of construction? It is not defined and some of the industry stakeholders have said that if, for example, the builder just happens to put a flag in the sand, that is, turns the first sod, and then doesn't return to commence the actual construction until two months later, does that constitute the commencement of construction? What deems the commencement of construction and who will be interpreting the commencement of construction? That is undefined in the legislation. Some of the other states are saying, 'If we allow this particular grant to go ahead and there is criticism in the media about it, will the federal government then just say, "It's the state that has actually wrongly given this particular person or builder approval to go ahead."'? So some of the state and territory governments are saying to the commonwealth, 'Hold on, that seems unfair or unreasonable. Maybe if you better defined exactly what you mean by 'commencement'—is it laying the slab, is it whatever it is, as to your definition?' Thus far, the commonwealth has not been prepared to better define those issues. It is an easy and a cheap shot in the Eastern States newspapers to say that state and territory governments are being intransigent. We are not; we are very anxious to get this money out there as quickly as possible. As I said, we in South Australia are less concerned about some of these issues. We will go with the flow, and if we are going to get attacked by the media or the opposition or commentators about having given a grant out, we are prepared to defend the decision that we take. We will push back and say, 'The federal government didn't define it. We have done the best that we can in relation to it.' Whilst this is a long answer, it is an important question. I have discussed it with my cabinet colleagues and, without going into the discussion with cabinet colleagues, I do have authority now to see whether or not we can get further quick agreement from the commonwealth to change one particular provision in the agreement. If that is the case, that would be welcomed, not only by South Australia but by other jurisdictions, but we don't intend to let the federal government saying no to that particular request prevent us from indicating that we are now prepared to go ahead and proceed. I would hope that by no later than early next week I will have signed the agreement on behalf of the South Australian government and that soon after that we can actually get RevenueSA, which is going to have to pick up the load in relation to this, organised to start getting the funds out there and start processing the applications.