2SM WITH MARCUS PAUL IN THE MORNING
TUESDAY, 6 APRIL 2021
SUBJECTS: Rising house prices; the Church of Scientology’s tax-free status.
MARCUS PAUL, HOST: Andrew, good morning. How are you, mate?
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Terrific, Marcus. How are you?
PAUL: Good. I hope you had a nice Easter, got a little time off to relax with family.
LEIGH: Terrific time, yes. My wife and I had a date night in the city, away from the kids in the middle of Sydney. I went for a run past your office - you're in a beautiful little spot there on Pirrama Road.
PAUL: It’s not bad, is it? Not bad at all.
LEIGH: It’s fabulous. Checking out the harbour. So feeling particularly well, and I hope your listeners are the same
PAUL: Thank you, mate. We used to have a view until they put up a whole stack of buildings in front. I'm told when this building first opened, this 2SM building which the boss owns, we had an unfettered view out to the harbour. But now, progress - I can't see. Well, I can see the big tower of Crown, but that's about it. Mate, 40 years ago the average house cost around twice the average annual income. Now it's what? Seven times, Andrew?
LEIGH: It’s gone from twice the average income to seven times the average income, Marcus. Housing affordability has become a huge national crisis. And that notion that if you work hard, you should be able to buy a home of your own is slipping from the grasp of so many young Australians. I’m really worried-
LEIGH: Well, one of the big issues is that we've encouraged investors over first time buyers. They've been steadily crowding out the market. So now we have a small number of people with more and more homes, and the mass of the people are less likely to own a home anytime in the last 50 years. It doesn't have to be that way. Partly, this is about supply, but partly it's also about making sure that we've got a fair mix of tax and housing policies that ensure that we've got homeownership rates rising.
PAUL: I mean, the government has tried to put a band aid on this ever-expanding problem. You know, they tried to introduce things like first homebuyer grants and all the rest of it. But again, that does very little when you compare what people are earning in relation to what housing costs, in particular in places like Sydney.
LEIGH: Absolutely. First time buyer grants tend just to inflate the market, much the same as the risk out of the government's HomeBuilder package. What you really need to do is to be investing in areas like social housing, making sure you're getting the zoning decisions right, and making sure that you're not tilting the tax system too far in favour of investors and away from first home buyers.
PAUL: So that's what's happening, in your opinion - we've prioritised investors over first time buyers. There is a lack of forethought in building social housing in our major cities and suburbs, which has obviously led to you know people not being able to afford to buy a home.
LEIGH: Absolutely right. There's nothing wrong with renting, but it's people being forced into renting who’d really like to own their own homes. We see more and more permanent renters in Australia who just feel as though they're locked out of the market. When I looked at the data around how people are spending their money, the whole smashed avocado theory gets, well, smashed. It doesn't look as though young Australians are spending more on discretionary items than that generation did in 1980. It’s simply that getting into the housing market is way tougher than it used to be.
PAUL: Alright, just on another issue here. Scientology, the Church of Scientology - their assets here in Australia now exceed $100,000 per member. Now, I'm not sure how many members are in the Church of Scientology in Australia. But if it was just 10, they'd be worth a million bucks. Now, obviously, it's a lot more than 10. It would be good to know about, a little bit more about their special tax deductibility status benefits. How does it benefit the broader community? Some would argue it doesn't.
LEIGH: Scientology’s had an interesting history in Australia, Marcus. It was banned in a number of states in the 1960s after it first emerged, and then after a 1983 High Court decision it then opened up. But now their number of adherents has been waning in the recent censuses. It's fallen below 1700 in the last census, and their assets have been going up considerably. So they've now got more than $170 million in assets, as well as significant assets being held in Australia for other parts of the church. And just as we worry about multinational tax avoidance, about companies not using particular tax loopholes in order to move money around, Australians need to be confident that the tax rates that the Church of Scientology enjoys in Australia aren’t being used to benefit parts of the Church of Scientology elsewhere in the world.
PAUL: I mean, it's not just the Church of Scientology. A lot of people argue that perhaps all other churches shouldn't be exempt from paying their fair share or any tax at all. I mean, we know it doesn't happen here.
LEIGH: Churches bring a lot of benefits. We have churches, mosques, synagogues that run community welfare organisations. They all operate schools. They provide a lot of generosity to people who are down on their luck, and direct assistance. It's just important for all religious organisations to make clear to the public how they're benefiting more broadly. One of the challenges that people have raised with the Church of Scientology is the way in which they've been at loggerheads with much of the mental health establishment over the proper treatment of mental illness, and that is viewed by many in the medical establishment as being against the public benefit, rather than in favour of it.
PAUL: Alright. Good to have you on. Thank you, Andrew. We'll chat again next week. All the best.
LEIGH: Thanks, Marcus.
Authorised by Paul Erickson, ALP, Canberra.