I know the feeling.
I’ve done the work of many, many people.
The idea of people getting out their mortgages and their savings and just going to have a bit of fun with the money is not something I think Australians are keen on.
The real problem is that when you’re the wealthiest people in the world, you have a duty to the rest of us to make sure that we’re living within our means.
This week I think we’re going to see a bit more anger than I have seen for a long time.
But what I want to say to Australians is this: I’m not going to let you down.
Because I believe in you.
And I believe you deserve a better deal.
In a statement released on Thursday, Treasurer Scott Morrison confirmed the government would be introducing legislation on Tuesday to reduce the amount of interest that would be charged on all Australian borrowers’ mortgages and savings.
The legislation will be introduced in the Senate and will require a two-thirds majority in the upper house to pass.
Interest rates are expected to rise to 2.75 per cent from 2.4 per cent on July 1, 2019.
“We are going to get the interest rate back down to what it was in the 1930s and 1940s and even earlier,” Morrison said.
“So that we can have the opportunity to have the savings of many of our people being reinvested in our country, in our infrastructure and in our business.”
Morrison said the Government would also provide a guarantee that all new loans would be repaid on time and at a reasonable rate.
He said this would provide the “fundamental right” to repay loans.
“I am committed to making sure that the people of Australia have a safe and comfortable future,” Morrison told ABC Radio Canberra.
“It is time to give Australians the confidence to take that next step and invest their money in their future.”
Morrison has said that interest rates will be reduced from the current level of 2.3 per cent in July 2019, to 2 per cent this July.
The government is also seeking to reduce other types of interest charges, such as those charged for servicing a mortgage.
These would be reduced to 0.5 per cent for borrowers with a minimum balance of $200,000.
The measures would also mean that lenders would no longer have to make interest payments of up to 4 per cent of a loan’s balance.
Morrison said that in all cases borrowers will be able to keep their current mortgage interest rate at 2.1 per cent, which is the same rate as the Consumer Price Index (CPI).
Morrison said he was confident that the interest charges will be cut “fairly quickly”.
“We’re not going anywhere,” he said.
In the meantime, borrowers will still have to pay a 2.5% interest on any debt they currently owe.
“If you’ve got a mortgage, you’ll still have it, but it will have to be repaid, it will be repaid at a fair rate,” Morrison added.
“In fact, it’s actually going to be quite a bit higher than that.”
In its statement, the Treasury also confirmed that it was working with the Federal Government to improve the way it collects and distributes tax on mortgage interest payments.
“The government will continue to work with the Commonwealth and State Governments to make it easier for Australians to understand how their money is being used and how it is taxed,” the statement said.
The statement comes after the Government announced a $20 billion package for affordable housing and other measures to support the growth of the housing industry.
The plan includes a $10 billion housing finance package and $5 billion for affordable and social housing.