Brendan Coates

That is how some of the existing state schemes work.

So there's a new Victorian scheme that private banks provide the rest of the finance.

But if you tried to open it up too quickly, one, you'd probably hit demand more.

But two, it's probably too difficult for the federal government to roll something out at full scale.

So therefore, you put that $5,000 a year cap on it, see how it goes.

And then if it looks like it's working, then you can expand it further.

That's right.

So there are existing state schemes.

The most well-known is Western Australia has a scheme called Keystart that's been in operation for 20-odd years and has worked pretty well.

That's a scheme that has a similar model to ours.

You can have up to 30% shared equity stake from the government.

It has similar rules around things like the purchaser has to pay the stamp duty and any maintenance costs, but obviously the borrower or the government doesn't charge any rent on its equity stake.

But these state schemes, they're relatively small because state borrowing costs are higher than the federal government.

So it is probably more efficient for the federal government to run a scheme than for the various states to have their own small ones.

And also, it's much easier to get banks involved because they've got one scheme with a national set of rules rather than, say, Commonwealth Bank deciding, am I going to get involved in a scheme that's only in one state with a certain set of rules?

So that's why the federal government is best placed to provide this kind of scheme.

It

would get a much more effective and efficient take up than if you tried to build on the existing, often fairly small state schemes that existed.

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