- HomeBuilder program ‘overstimulated’ construction and drove house price inflation
- Suspected Medibank hackers post stolen data
- Strip RBA board of rate-setting power, review told
- This morning’s headlines at a glance
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HomeBuilder program ‘overstimulated’ construction and drove house price inflation
More than 100,000 people drove the cost of the pandemic-era HomeBuilder program out to $2.3 billion, an analysis of the scheme has found, leading to an overheating of the building sector and adding to inflation pressures that have forced interest rates to a nine-year high.
Economists say the former Coalition government was right to try to inject stimulus to avoid a collapse of the home construction industry at the peak of COVID-19, but it became a victim of its own success with more than three times the number of people applying for the program than original estimates.
The HomeBuilder grant program was introduced to stimulate the residential construction industry.Credit:Erin Jonasson
The Department of Treasury originally forecast there would be 27,000 approved HomeBuilder grants at a cost of about $678 million. But a review of the program, conducted by KPMG with Treasury, found by the end of June 2022, after the program had been extended twice, 100,214 grants were approved at a total cost of about $2.3 billion.
Grattan Institute economic policy program director Brendan Coates said while the home building sector needed support at the time, it is now obvious that construction costs would be lower in a world where the HomeBuilder program had been smaller.
Read the full story here.
Suspected Medibank hackers post stolen data
A ransomware group has begun posting client data it says it has stolen from Australia’s largest health insurer.
Hundreds of names, addresses, birthdates and purported Medicare details are being posted under a “good-list” and “naughty-list” on a blog belonging to the group on the dark web.
Medibank has previously confirmed almost 500,000 health claims were stolen by the hackers, along with personal information, when the unnamed group hacked into its system weeks ago.Credit:Louise Kennerley
The hackers had demanded a ransom to stop them from releasing the data, but Medibank earlier this week said it would not pay because it would encourage further crime.
The group posted the first lists shortly after 12.01am this morning, AEDT.
We’ll have more details as they come to hand.
Strip RBA board of rate-setting power, review told
The Reserve Bank board would be stripped of its power to set interest rates and forced to explain why it fails to hit its inflation targets, while senior staff would be barred from holding shares or government bonds under sweeping proposals put to the inquiry examining the institution.
Former RBA economist Zac Gross, whose research into the bank’s pre-COVID interest rates settings found up to 270,000 jobs failed to be created due to overly tight monetary policy, said a committee of experts should set interest rates rather than a board of “corporate leaders” with little economics experience.
The Reserve Bank board would lose its power to set interest rates under a proposal that would shift the responsibility to a separate expert committee.Credit:Louise Kennerley
Gross also has called for the Reserve Bank to take macroprudential powers back from the Australian Prudential Regulation Authority, so it can target issues such as soaring house prices without having to resort to interest rates.
The review, the first of the RBA in more than 40 years, is being led by a three-member panel that includes international monetary policy expert Carolyn Wilkins, who sits on the Bank of England’s financial policy committee; the interim director of the Crawford School at the Australian National University, Renee Fry-McKibbin; and the secretary for public sector reform, Gordon de Brouwer.
Submissions to the review closed on Monday. It is due to report to Treasurer Jim Chalmers by the end of March next year.
Read the full story here.
This morning’s headlines at a glance
Good morning and thanks for your company.
It’s Wednesday, November 9. I’m Broede Carmody and I’ll be anchoring our live coverage for the first half of the day.
Here’s what you need to know before we get started.
- The suspected Medibank hackers have started publishing names, addresses and birthdates on the dark web. Earlier this week, Australia’s largest health insurer declined to pay a ransom – a decision backed by the government.
- The review into the Reserve Bank has been told the board should be stripped of its rate-setting powers. Shane Wright has the full story.
- Staying with the economy, and the former government’s HomeBuilder program “overstimulated” construction and drove up house prices, according to an analysis.
- In state news, the Supreme Court of Victoria says keeping the draft findings of an anti-corruption probe secret in the middle of an election campaign doesn’t interfere with the public’s right to know. Meanwhile, in NSW, a gambling reform advocate has labelled state Labor the “party of social injustice”.
- And in international news, we’ll start seeing the results trickle in for the United States midterms later this morning. Democrats are expected to lose control of the House of Representatives.
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