[Theme Music Starts]

RUBY:

From Schwartz Media and 7am, I’m Ruby Jones and this is The Vote.

On the weekend, the Coalition launched its campaign, just six days before the election…

Archival Tape -- Scott Morrison:

“How good is it to be in Queensland. Thank you all very, very much.”

Archival Tape -- Audience member:

“How good is Queensland.”

Archival Tape -- Scott Morrison:

“How good. How good indeed.”

RUBY:

The centrepiece of the launch was a new housing policy, which it promises will help more young people to buy a home, by allowing them to take money out of their superannuation.

Archival Tape -- Scott Morrison:

“Today, I want to announce to you the next stage of our plan to help Australians own their own home….”

RUBY:

But will the scheme really help new home buyers or is it too little, too late?
Today, national correspondent for The Saturday Paper, Mike Seccombe on what the Coalition is offering voters at this election.

It’s Tuesday May 17.

[Theme Music Ends]

RUBY:

So Mike, this Saturday is Election Day and at the moment the government is trailing in the polls. So it seems like a good time to to ask what it is exactly that the coalition are offering voters. What would they deliver if they were given another three years in government?

MIKE:

Well, the big ticket items were really outlined before the election even started in the budget

Archival Tape -- Josh Frydenberg:

“Mr. Speaker. Tonight we write a new chapter in Australia's economic story.”

MIKE:

And they were several short term giveaways to voters. You know, there was a one off $250 handout to pensioners and welfare recipients, which was costing $1.4 billion to the government.

Archival Tape -- Josh Frydenberg:

“As we emerge from the pandemic, we are building an even stronger, more secure and confident Australia.”

MIKE:

There was a halving of the petrol excise tax to have it for six months, which is costing the government another $2.9 billion.

Archival Tape -- Josh Frydenberg:

“It will deliver hope, work and the prospect of returning to a better life.”

MIKE:

And there was a one-off expansion of the low and middle income tax offset to $420, which is costing the government $4.1 billion.

Archival Tape -- Josh Frydenberg:

“Mr. Speaker. Tonight we look to the future.”

MIKE:

So, you know, some pretty big bucks there.

RUBY:

And so as well as this, the Coalition has announced this new housing policy, at their launch over the weekend, so can you tell me Mike exactly what this policy is and whether it’s going to anything to help people who are trying to buy a home?

MIKE:

Well, actually, there were two parts to the proposal.

One was a scheme allowing people over the age of 55 who are looking to downsize their homes, you know, because the kids had left and so on to sell their homes and then put 300,000 of the proceeds tax free into their super. Actually, this was an extension of an existing policy. Previously the Cut-Off age was 65, so now it's 55. It's been sold as a measure to increase housing supply, but the general expectation is that it will have only a marginal impact. Although, you know, it's a very nice look if you're an older person looking to sell your real estate because you get a $300,000 tax free windfall. So that's part one.

The more contentious part was a plan to allow first home buyers to pull up to 40% of their superannuation savings out to put towards a deposit for a house and that's up to a maximum of $50,000. So they could pull out up to 40%, up to $50,000. And then down the track, when they sold the house, they would be required to return the money into their super, including a share of any capital gain. So that was the more contentious bit. It's been pitched as a measure to help younger buyers, but there are a couple of obvious drawbacks. First, many young people don't have much super to draw on and certainly not able to pull out $50,000. Second, if we imagine two potential first home buyers at an auction, you know, now armed with money they've pulled out of their super, they will bid against one another and bid up the price. That's that's obvious. It will pump up prices. And that's why the scheme is almost universally seen as a bad idea.

RUBY:

And so that’s some of the bigger policies the coalition have announced, but what else are they offering, Mike, and which voters are they targeting with their election promises?

MIKE:

Well, they've added a lot of detail and they've added a lot of extra things throughout the campaign as as any party running at the election does. But they've mostly been smaller spends, than those big ones in the budget.
To give you an example, two weeks ago, roughly, Scott Morrison announced $70 million to broaden access to the seniors health card. So that so this meant that an extra 50,000 older Australians would get this card, which not only cuts the health and pharmaceutical costs, it also gives discounts on things like electricity and gas, public transport, you know, other benefits. And the policy that he announced raised the income threshold, for being able to get this card from about 57,000 to 90,000 for singles and from about 92,000 to $144,000 for couples.

And I think this is interesting because, you know, it gives you some insight into where the coalition is trying to win this election. You know, the demographics they're targeting and they're looking to target seniors and in particular, seniors who are pretty well-off, you know, basically self-funded retirees.

RUBY:

Mmm. Okay. And so how much do these essentially self-funded retirees gain from what the coalition is promising then?

MIKE:

Well, I spoke to Brendan Coates about this. He's the Economic Policy Programme director at the Grattan Institute, and he told me this this spending is, is just extraordinarily generous, as he told me. We're talking here about people with a lot of money.

The average wealth for that cohort that now has access, the average wealth, some will be wealthier, not including their house is $1 million for singles and $1.5 million for couples. And and he questioned the fairness of that spending. And I said, if if we're going to spend more money to help people, is that really the place you should go or should you have gone to rent assistance for, you know, impoverished retirees who are struggling to pay the bills or expand dental treatment for people whose, you know, teeth are literally rotting and can't afford to get a set of dentures.

So, there are questions about the equity of it, but that's not the only policy that that has been announced that targets this relatively well-to-do group.

The government has also halved the rate at which retirees must draw down on their tax free superannuation. They did that during the pandemic in the expectation that the value of the shares and the other assets held by these people would fall.

But those assets? Well, for a start, some of them didn't fall to everyone's surprise, but they've since more than recovered their value. You know, the share market's been on a tear until quite recently. And yet the government is saying it will extend the measure.

So you can see this pattern in the Coalition's policy, shoring up support in this demographic of voters. And all these perks add up. I mean, taken together, Coates told me that benefits like the seniors health care card extension, the minimum drawdown requirements, reduced deeming rates on on pensions for four part pensioners collectively total about a billion dollars out to 2025. So, you know, a billion here and a billion there, as they say. And pretty soon you're talking serious money.

RUBY:

Mm. Yeah, for sure. And so, Mike, why exactly is this happening? Why is the coalition specifically targeting this group of people, do you think?

MIKE:

Well, the fact is, retirees, particularly wealthy self-funded retirees, vote heavily, heavily for the coalition.
At the 2019 election voters over the age of 65 were the only age group, the only age group that gave the majority of their first preference votes to the Coalition. 55% of them voted number one for the Liberals and another 4% voted one for the Nationals. That's according to the Post poll Australian Election Study. So the seniors vote was crucial in keeping the Government in power then and and they figure it could be again.
And I might say it's testament to the power of these older voters that that every time Morrison has announced a policy targeting this group, Labor has has come out and matched it. This is very different from what they did three years ago. So they have matched all these policies like within a day. Usually they've committed to matching the Coalition's spending because they don't want to be bitten by those older voters again.

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RUBY:

Mike, we've been talking about the Coalition's policy platform and how one thing that it's doing at the moment with its policies is targeting older voters and the Labor Party is actually matching a lot of the Coalition's spending when it comes to seniors. So has that effectively neutralised a lot of the strategy that the Coalition would have been hoping to pursue?

MIKE:

Well, that's certainly its intent. And I might add that that, you know, Labor is very aware of how the government scared older voters about a retiree tax and even a mythical, you know, death tax at the last election three years ago.

So they're not giving them any move to make that case this time. They're matching a whole lot of promises for that age group.

Archival Tape -- News:

“At a retirement village in Victoria, he unveiled a plan to expand the seniors health concession card to more people.”

Archival Tape -- Scott Morrison:

“This will help 50,000 more Australians be able to have access to that certainty of the health care that they wish to have as they move into their senior years.”

Archival Tape -- Anthony Albanese:

“We support the measure. We know that people who are under cost of living pressures and where there's a good idea, we will support it.”

MIKE:

But they're also in lockstep with the government when it comes to a bunch of other things as well. For example, the government announced it would reduce the price of medicines under the Pharmaceutical Benefits Scheme, so the maximum cost of any medication on the PBS would be $32.50.

Archival Tape -- Scott Morrison:

“The Coalition pledging if it's re-elected to cut the price of all medications on the Pharmaceutical Benefits Scheme by $10, meaning from January one. A script would cost no more than 32.50.

This would save patients taking one medication a month, just as we heard here today, $120 a year.”

MIKE:

The very next day, Labour came out and announced that it would cut the price to $30. So it raised the bid slightly.

Archival Tape -- Anthony Albanese:

“This means the maximum price for PBS medicines will be just $30.”

MIKE:

You know, the government's housing policy, Labour, has simply adopted the popular parts of the housing policy and they raised it and that's been a consistent theme across quite a range of policy areas. Now government proposals, labour matches or matches and slightly betters.

RUBY:

Right, and are there other areas where the Coalition’s spending is being matched by Labor?

MIKE:

Ok, On areas where Labour has traditionally enjoyed an advantage, it is doing more than matching the government. If we look at things like women's issues, it's it's gone much further on childcare.

Things that appeal to younger voters who are traditionally more inclined to vote progressive It's gone somewhat further on climate change. It's gone somewhat further on education, university policies.

So so Labour has neutralised its negatives and it has exceeded the government in those areas where it enjoys a natural advantage.

So. So anyway, when you add all these things together, this is left. Scott Morrison, you know, the accomplished negative campaigner that he is with, not a lot of points to attack specifically.

Archival Tape -- Scott Morrison:

“In a weaker economy, it's harder and you don't want to risk a weaker economy”

MIKE:

And this means it's come down essentially in the homestretch to the government making essentially two arguments that it is better at running the economy

Archival Tape -- Scott Morrison:

“That's why this election is all about who can manage that economy best”

MIKE:

and that it is the party of lower taxes.

Archival Tape -- Scott Morrison:

“to ensure that we can have a strong economy for a stronger future for Australia.”

MIKE:

And and these are the things that the coalition is mostly talking about.

RUBY:

Right. So the coalition pitched then Mike to voters one week out from the election could be summarised as We are good on the economy. If you want proof, just look at the tunemployment rate and we will deliver lower taxes. So can it actually do both of those things?

MIKE:

Well, first thing to be said is that actually the government has not done a bad job through the COVID recession and they should be given credit for that. I mean, no doubt Labor would say that it would have done the same thing had it been running the show at the time and would have taken the same Treasury advice and done the same stuff. But, you know, the government did it. Kudos to them. And we do have, you know, 4% unemployment and that's and that's a big, big achievement.

But, you know, some of the Government's other claims for, you know, allegedly being the superior economic manager, you know, you have to have to add caveats, should we say.

For example, they talk about the rapid improvement in the budget bottom line. But when you look at it, much of that is due to forces entirely beyond the government's control. You know, just as the inflation rate is. You know, Australia's earnings from commodity exports will hit a record $425 billion this financial year, which is fully one third higher than last year. And and driving this, according to the latest report from the government's industry department, is the upsurge in prices for energy commodities since since Russia invaded the Ukraine.

As for the second claim, Morrison insisted during Wednesday night, leaders debate and I quote him, We have always delivered lower taxes

And he's made the same the same claim ad nauseam throughout the campaign.

Archival Tape -- Scott Morrison:

“It begins with keeping taxes low and cutting red tape”

Archival Tape -- Scott Morrison:

“Josh has continued to ensure we keep those taxes low”

Archival Tape -- Scott Morrison:

“And together with lower taxes, we have a practical plan to deal with cost of living pressures.”

MIKE:

But it's not true, according to Richard Dennis, who's the chief economist at the Australia Institute. He points out that the Government, with Labour's support, has legislated tax cuts woth $15.7 billion per year to come into effect at the end of July 2024. So those taxes are going down.

But in the meantime, another tax measure, the low and middle income tax offset, which is worth about $7 billion a year to the people who get it, is due to end this year. And the net result, according to Richard Denniss, the Australia Institute's analysis, is that 80% of taxpayers will actually be worse off.

RUBY:

Ok, Mike, when we take a step back then and look at all of these policies, the Coalition policies – many of which also been adopted by the Labor party – who is missing out? Which voters have not been promised very much from the major parties this election?

MIKE:

Well, the big and most obvious one I think is, is people on welfare benefits, you know, the unemployed. Neither party has shown any inclination at all to lift the unemployment payment above the poverty level. So that's a big one.

More broadly, I think, you know, young people would like to see more on education and they would like to see particularly more on the environment. The Government and Labor have both not been as ambitious there as, as some might hope.

And housing, they haven't said much about increasing the supply of housing. They particularly haven't said anything very impressive about building more particularly social and affordable housing.

And I think the reason for this is that demographics I mean, it's simple electoral demographics. Both parties have zeroed in on where they might pick up extra votes and they've gone after those. And there are other demographics that they've just assumed that they can take for granted.

RUBY:

And finally Mike, if this weekend was the Coalition's last opportunity to sell themselves to undecided voters, what do these announcements that the made say about their final strategy to win the election?

MIKE:

Well, I think, first of all, it says that they're in a lot of trouble.

Second, coming into the last week of the campaign, what we see is Labour playing MeToo politics with an awful lot of the Coalition's policies anywhere that it may be vulnerable. It's it's just signed on the dotted line supporting what the government's doing. At the same time, it's been obviously emphasising the areas where it has it has a natural advantage. You know, women, younger voters, through things like health, aged care, education. And now in this final week, Morrison's tried to set up a fight on housing, but Labour has signed on to the first part of this package, that is for the older people selling their houses. The second part of the package. Young people writing their super to get a deposit. Labour is is opposing.

So it sets up a fight for the last week. I still don't think it's a fight the government can win, I think. I think it's not really going to be seen to help young people terribly much at all.

RUBY:

Mike, thank you so much for your time.

MIKE:

Thank you for having me.

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RUBY:

Also in the news today,

The leaders of Finland and Sweden have confirmed they intend to join the NATO alliance, signifying a historic policy shift triggered by Russia’s invasion of Ukraine.

The two countries have had policies of neutrality for decades but both announced they would now pursue joining the US-backed alliance.

Russian president Vladimir Putin has warned that such a move would oblige Russia to “restore military balance” in the region.

I’m Ruby Jones, this is 7am, see you tomorrow.