The political power of tradesmen helped put Scott Morrison in office – and now he has a scheme to repay them. By Mike Seccombe.
Who Morrison is looking after
It’s hard to be precise about when the political migration of the tradies began, but Ian McAllister dates it to the mid-’80s.
Certainly, the shift was important to the election of John Howard’s government in 1996, when significant numbers of those McAllister calls “manual worker supporters” – Howard’s “battlers” – backed the Coalition.
Rebadged as “Tony’s tradies”, they later helped the Abbott government to power. And without them, Scott Morrison almost certainly would not be prime minister today.
The evidence is all there in the 2019 iteration of the Australian Election Study (AES), the definitive national survey of political opinion, which McAllister, professor of political science at the Australian National University, has overseen after every election since 1987.
The data gathered shows that among voters with a university education – who may have once been called white-collar voters – Labor got 36 per cent of the primary vote and the Greens harvested 17 per cent, while the Coalition received 38 per cent and the minor parties swept up the remainder. Likewise, among voters with no post-school qualifications, Labor and the Greens received a combined 51 per cent.
Only among voters with a non-tertiary qualification, most often a trade qualification, did the Coalition win more of the primary vote than the parties of the left: it secured 46 per cent, with Labor and the Greens scraping together a combined 42 per cent.
The fact is the conservative parties did poorly across a range of key demographic groups in the last election. Only 38 per cent of women voted for them, versus 52 combined for Labor and the Greens. Fortunately for the Coalition, men were five points more supportive of the political right.
Meanwhile, only 15 per cent of voters aged 18 to 24 and less than a third of 25- to 34-year-olds voted Liberal or National.
This welter of statistics helps to explain a couple of important things.
First, how the old indicators of likely voting intention, based on class and whether one wears a white or blue collar – or a suit or a fluoro vest – have lost their currency.
There is now a wide variety of other factors in play – age, sex, education, social grouping, place of residence et cetera. One big thing is assets. Your background, it seems, counts less than how much you’ve got in the bank when it comes time to vote.
And tradies, it turns out, have quite a lot.
“The idea that all the people that own shares and investment properties and all the rest of it are your barristers and your fancy medicos is actually not true,” says McAllister. “Most of them tend to be self-employed people, manually self-employed.”
He has the stats to back his assertion. The self-employed are about 15 per cent of the electorate, but they make up 18 per cent of home owners, 19 per cent of share owners, 22 per cent of rental property owners and 26 per cent of self-managed super funds.
The 2019 AES data also helps to explain the design of a recent policy announced by the Morrison government.
Just like those other economic stimulus measures about which we have heard so much since the coronavirus outbreak – JobSeeker and JobKeeper –the package came cutely badged with two conjoined words and a capital letter in the middle: HomeBuilder.
The media release announcing the scheme on Thursday last week wasted no space talking about the benefits to the occupants of the homes, dwelling instead on the benefits to those who would construct them.
“The Morrison Government is supporting jobs in the residential construction sector,” it began, and went on to claim HomeBuilder would help maintain “140,000 direct jobs and another 1,000,000 related jobs” in the sector, which seems a somewhat optimistic claim even for a scheme predicted to cost $688 million and deliver 27,000 building projects.
And it attracted some strident criticism. Emma Dawson, executive director of progressive think tank Per Capita, declared HomeBuilder to be “surely in the running for the most mendacious piece of public policy since Peter Costello decided to give tax refunds to people who don’t pay income tax”.
HomeBuilder is essentially a grants program for home owners and buyers, similar to those various governments have run for decades, but with some unusual features.
For one, it is not limited to first-home buyers, as is normally the case. People can get the $25,000 grant if they either build a new house or substantially renovate an old one. And they can get it in addition to any other home buyer incentives on offer from various state governments.
It is, however, tightly time limited. In order to be eligible, applicants will have to enter into a contract before the end of this year, and construction will have to begin within three months of the contract date. And the project must have a minimum value of $150,000 and a maximum of $750,000. In the case of a renovation, the value of the existing house cannot exceed $1.5 million.
Although the limits placed on the value of projects will likely prevent hugely wealthy people in the inner suburbs of major cities from accessing the scheme, it will still benefit those who are fairly well to do. A single person with an annual income of as much as $125,000, or a couple earning up to $200,000 – about two-and-a-half times the median household income – can get a HomeBuilder grant.
And of course, the short time frame, as many experts point out, means applicants will probably have their finance lined up already. Which is to say, most grant recipients would have carried out the work, with or without HomeBuilder.
Thus, the scheme will help people who are getting through the Covid-19 economic crisis without the need for help from the government, but not those who have suffered in the recession.
The fact the money can be used to fund renovations is particularly questionable, in the view of many experts, because it does nothing to increase Australia’s stock of houses, a key issue in housing affordability.
“So, you’re putting all this money into people who may just turn around and sell when conditions are favourable,” says Adrian Pisarski, executive officer of National Shelter, the peak body representing social housing organisations. “And then all that’s happened is that taxpayers’ money has been capitalised by someone.”
Pisarski says he understands the need to stimulate construction given the economic slowdown but doesn’t understand why the government set a minimum value of $150,000.
“They could have done a lot more at a smaller level. Older people could have been helped to upgrade the fixtures that they need to enable them to age in place,” he says. “It could have been much better targeted around energy-efficient and disability accessibility.”
Or the government could have done what a wide range of organisations – the Housing Industry Association, Master Builders Australia, the Construction, Forestry, Maritime, Mining and Energy Union, welfare groups and some progressive think tanks – have advocated, and put the money towards building up Australia’s depleted and degraded stock of public housing.
“The high point was in 1991,” says Pisarski, “when about 6 per cent of all housing was public, or social housing as we call it now. We’re now down to about 4.8 per cent.
“We’ve seen less investment, particularly by the federal government, and a rapidly growing population. We just haven’t been keeping up with that supply relative to household growth.”
A report by the Australian Council of Social Service (ACOSS) last year stated that at least 116,000 people were homeless in Australia, and there were hundreds of thousands more on the lowest incomes for whom the private rental market was unaffordable. It cited research indicating a national shortage of some 400,000 houses.
ACOSS didn’t call for the government to build that many, because it would be prohibitively expensive to do at once. Instead, it advocated a joint program between the federal government and the states to add 20,000 new dwellings over three years. It costed the federal government contribution at about $7 billion.
This has been done before during tough economic times, says Pisarski.
“In the Rudd years, they spent about $5.5 billion on a social housing stimulus that provided 20,000 new properties and upgraded 78,000,” he says.
Despite that investment, the waiting list for social housing still stands at some 150,000 people.
But the housing problem is even bigger than that, says Brendan Coates, the Grattan Institute’s program director of household finances.
As of 2016, the overall home ownership rate in Australia stood at 67 per cent, down from a peak of 70 per cent, which doesn’t sound like a big decline.
“But the ageing of the Australian population has concealed a greater fall in home ownership rates over the past two decades,” says Coates. “Between 1981 and 2016, home ownership rates among 25- to 34-year-olds fell from more than 60 per cent to 45 per cent.”
As economist Saul Eslake notes, this decline can be attributed, in part, to home buyer grants schemes such as HomeBuilder.
“We’ve had first-home owner grants in one form or another ever since 1964, when the Menzies government introduced them, at the urging of the then president of the New South Wales Young Liberals, whose name was John Howard,” he says.
But they didn’t help people into homes of their own. Instead most of the benefits “end[ed] up in the pockets of vendors or builders, which is why builders are so keen on them,” Eslake says.
And perhaps why builders were so keen on John Howard.
Despite this, Eslake is not opposed to the current government’s efforts to stimulate the construction sector. He actually thinks they should spend more – but spend it on social housing.
So why has the government not done this? Why does it prefer to subsidise relatively well-off people into home ownership rather than provide affordable social housing for struggling renters?
Perhaps the Australian Election Study offers a clue. At last year’s election, it shows, just on 50 per cent of all home owners gave their first preference vote to the Coalition parties. Among those who owned a rental property, the figure was 59 per cent.
Among voters who rented, however, just 27 per cent voted conservative.
It’s perhaps too cynical to think that, as Emma Dawson wrote, HomeBuilder was structured for the purpose of “pork-barrelling to the Coalition’s electoral base”.
Then again, in the wake of its HomeBuilder announcement, the government this week prematurely pulled the JobKeeper wage subsidy rug out from under another large and troubled industry: childcare providers.
The two sectors are very different. Construction is overwhelmingly – almost 88 per cent – male, and its workforce is relatively highly paid. Childcare is equally overwhelmingly female, and its workers earn, on average, only about half as much. The construction sector continued to operate, on the whole, as usual through the Covid-19 crisis, while childcare businesses were among the most heavily impacted by the shutdown.
And while the government has promised a $708 million transition package to childcare providers, that equates to only about a quarter of the sector’s revenue, pre-crisis, according to providers and staff. They fear parents who have seen their incomes fall as a consequence of the recession will not be able to afford it. They fear jobs will be lost.
On Wednesday, The Australia Institute released an economic analysis showing women had borne the brunt of the pandemic recession so far. In March and April, the number of women employed fell 5.3 per cent compared with 3.9 per cent for men, while women lost 11.5 per cent of their work hours compared with a loss of 7.5 per cent for men.
“But despite the clear evidence that women are disproportionately losing their jobs and incomes, the Morrison government is developing stimulus policies that disproportionately favour male-dominated industries,” said the institute’s chief economist, Richard Denniss.
He was referring, of course, to HomeBuilder.
We can only guess at the reasons for the differential treatment. But the election study helps make that guess more educated. Childcare workers are young, female, low paid and generally not asset rich. Those are decidedly not the characteristics of the conservative voter base.
This article was first published in the print edition of The Saturday Paper on June 13, 2020 as "Who Morrison is looking after".
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