DAWSON, Mr Matthew (Matt), Executive, Home Lending Platforms, National Australia Bank [by video link] STEEL, Mr Peter, Group Executive, Digital, Data and Artificial Intelligence, National Australia Bank [by video link] [09:32] CHAIR: Welcome. I understand that information on parliamentary privilege and witnesses giving evidence to Senate committees has been provided to you. Do you have an opening statement? Mr Dawson : Certainly. Good morning, Chair and members of the committee, and thank you for the opportunity to appear today. NAB CEO, Andrew Irvine, has described productivity growth as the speed limit for the Australian economy. If productivity slows, our economy's capacity to grow, lift living standards and create opportunities slows with it. From NAB's perspective, one of Australia's clearest productivity challenges is housing. Housing affordability is fundamentally a supply challenge. Australia is simply not building enough homes to keep pace with population growth and demand. Housing is often discussed as an affordability issue, but it is also a productivity issue. When we don't build enough homes, it becomes harder for people to move to where jobs are being created and harder for businesses to attract workers. There is no single solution, but there are practical ways to help unlock supply. That includes streamlining planning and approvals, ensuring that enabling infrastructure keeps pace with growth and supporting innovation in areas such as modular housing. For modular housing to scale in Australia, state based building, insurance and consumer protection frameworks need to keep pace with new construction methods. The same principle applies to the home loan process. If we want faster, safer and more efficient lending decisions, policy settings need to support trusted digital tools as well as new ways of building homes. That is why we welcome the government's budget announcement of committing to explore how customers can share their ATO tax data safely and securely with their bank through the consumer data right. This would allow banks to rely on a single source of trusted data, rather than asking customers to submit multiple documents such as income payslips for loan applications. These kinds of practical reforms matter because productivity is not abstract; it is about removing unnecessary friction from the systems people rely on. Alongside housing, artificial intelligence represents one of the most significant productivity opportunities available to Australia. At NAB, we're already seeing how automation can help bankers categorise and analyse home loan applications, reducing manual processing and helping customers receive decisions more quickly. We're continuing to refine AI-driven process improvements so our people can serve customers better and faster. We look forward to discussing how both housing and technology can help lift Australia's productivity and answering the committee's questions this morning. CHAIR: Thanks very much for being there. Are you saying you think that the payslip and all the other information issues that are causing fraud in the system could be addressed in part through government doing some things? Mr Dawson : Absolutely. We welcome the government initiatives such as the exploration of sharing of ATO data through the consumer data right. It would streamline and accelerate loan applications. It would strengthen fraud detection and it would also deliver broader productivity benefits and customer outcomes. To be honest, work could also be done to investigate the possibility of a direct ATO-to-bank data-sharing system that would provide a more secure and verifiable alternative. CHAIR: Do you think this would help with the huge problem of mortgage fraud? Mr Dawson : Yes. As I said, it would help with documentation verification, and, ultimately, it would prevent fraud. CHAIR: What about the issue of lending to developers and builders? How is that going at the moment? Mr Dawson : We've been playing our role. You may have seen the announcement earlier in the year that we've made a $60 billion commitment to housing affordability finance ambition. That's split evenly between supply-side finance for residential development and then demand-side support for first homebuyers. CHAIR: Is there anything else that the government in Canberra can do to help with that? Mr Dawson : There's probably the allowance. We've continued to engage with the government to ensure that we consider ways to support lower building costs, the regulatory impost and then the labour shortages. CHAIR: What about on mortgage innovation? Is there anything you think that can be done to help get different kinds of mortgages into the field? Mr Dawson : Well, I think there's probably a couple of different layers to that innovation point. One would be from a product perspective in areas such as modular housing and consideration of product to support that modern method of construction. Similarly, the leveraging of AI, as I said in the opening statement, to support better, safer and faster outcomes for customers by leveraging new technologies. CHAIR: In terms of financing of housing, is there anything at all, do you think, could be done to help get more money out the door? I mean, it's clear we're not getting enough houses built, so I'm just wondering whether there are barriers between banks and builders and developers. Mr Dawson : I'll touch quickly on modular and maybe take a broader position on notice. As I said, at a practical level, governments at all levels should continue to look for ways to streamline planning and approval processes to ensure that the right enabling infrastructure is in place to support the delivery of new housing supply. Specifically for modular, if we want modular to scale in Australia, it's important that the building insurance and consumer protection frameworks can keep pace with the new construction methods. Currently, state based building insurance schemes don't cover modular construction phase and delivery. Therefore, in the event of a manufacturer insolvency during that construction phase, consumers could lose that upfront payment and potentially be left with negative equity. We have raised this challenge with the federal government and we will continue to engage constructively with governments at both federal and state levels across Australia as they look to address the challenges such as appropriate insurance. CHAIR: We might get you to provide that in more detail on notice. What have you seen since the budget in relation to first homebuyers? Because the clearance rates are pretty low still in Sydney. Have you seen anything there? Mr Dawson : Yes. Again, there are probably a couple of points to make in this space. Post the tax changes people are clearly looking towards shifting more investment into new housing. But, to be transparent, it's too early to be definitive about the market impact. Our CEO publicly said in June mortgage activity has slowed, particularly amongst investors. But people are waiting to see how those changes play out. When they feel uncertain, they tend to pause. CHAIR: What about in relation to the presale? What do you require in terms of presales before you finance a building? Mr Dawson : I sit in the home lending business. I'd have to take that question on notice, I'm afraid. CHAIR: Have you noticed anything to do with the SMSF ban in terms of presales? Mr Dawson : Similarly, I'm not across the detail on SMSFs, I'm afraid. I'll take that on notice. CHAIR: I'll hand the call now to Senator Ananda-Rajah. Senator ANANDA-RAJAH: I'm interested in understanding what the bank is doing to support build to rent. I had the opportunity of touring a NAB-financed build-to-rent precinct in Melbourne not so long ago. It was quite impressive actually, a really beautiful development. I am interested to know what you're doing to encourage this asset class. It probably hasn't received enough attention. Do you think that the changes in the budget will see an increase in build to rent, particularly from institutional investors? Mr Dawson : That is a great question. NAB supports measures that increase housing supply across all tenures, including owner-occupied housing, affordable and social housing, modular and build to rent. As Australia's largest business bank and a major institutional lender, we finance a range of residential development projects which include build to rent because increasingly housing supply is critical to improve affordability and easing rental pressures. Build to rent, though, is not a replacement for homeownership, nor should it be viewed as an either/or choice between institutional investment and individual investors. Build-to-rent developments can attract both domestic and international capital. The key question is whether investment is helping to deliver this additional housing supply, and Australia needs more housing of all types. Build to rent is one mechanism for delivering that additional housing stock to address the broader housing shortage across Australia. Senator ANANDA-RAJAH: Do you have any forecasts as to what number of build-to-rent buildings or dwellings you expect to see going forward? Mr Dawson : I don't have specific numbers to hand, I'm afraid. Again, I'll take that on notice. But as I said, we're seeing it as an as one of the classes of innovation in construction and product that we're exploring to support that broader supply. CHAIR: Before we let you go, I just wanted to ask: what's the one thing you think we could do to get supply up in Australia that's in the preserve of the federal government given that we are not getting enough houses? We used to get a lot more. We have a bigger population. So is there one thing you think that we could do that would help on the financing and mortgage and banking policy side that would really make a big difference? Mr Dawson : That is a very good question. Unfortunately, I don't think there's a single silver bullet. As I mentioned, it would be any work that can go to removing those practical barriers—building costs, regulatory impost. We talked about support from federal and state governments and alignment on planning processes. From a modular perspective, it would be support from an insurance perspective to support consumers such that we could then look to scale modular housing as a product set. CHAIR: Thank you very much. You go with our best wishes..