The below speech was delivered by NAB CEO Ross McEwan at an Australia Israel Chamber of Commerce event in Melbourne on August 24.

**Check against delivery**

As I thought about today’s gathering, there are many issues that we’re all facing in our personal and business lives.  But I’d like to focus on two in particular where with the right attention, we can make a real difference. The first is the housing supply problem, and the second is the transition to net zero.

Let’s start with a few thoughts on the state of the Australian economy, which may be good context.

Inflation, while slowing, has hurt Australians more during the past 18 months than it has for three decades.

There is a lot of discussion as to whether Australia will head into a recession as we do have many headwinds. My view is we won’t.

But things are harder, and will continue to feel harder for some time, because of the difficult but necessary actions taken to get inflation down.

I say difficult but necessary because the alternate of rampant inflation is worse. I can recall my first mortgage interest rate was 18% and my wife and I had a second mortgage at 24%, but inflation was running at 14 to 15%.

Others in the room will have had similar experiences. We don’t want a return to that.

NAB data shows cost of living is already the greatest driver of stress for Australians by a big margin.

It’s difficult to find an area of spending that hasn’t gone up. Groceries, petrol, mortgages, rent, electricity, gas, dining out, travel, transport – you name it, everything we buy as consumers is up in price.

This has led to a major behavioural response. Our customers are more engaged in their finances than ever before, and many personal customers are budgeting for the first time.

They want to be good with their money and take responsibility.

Customers are making considered changes to their spending that is saving them, on average, about $300 a month, as they cut back on things like eating out and car trips to save fuel.

A story close to home at NAB – in our offices we’re seeing long queues at the complimentary coffee machines as our colleagues swap a $5 takeaway for a free office brew. Nobody was using these machines a year ago! But I am delighted they want to be back in the office, so no complaints.

NAB is proactively reaching out to check-in with customers, and so far, it’s been largely a message of ‘thank you, we’re doing ok’.

We’ve been in contact with over half a million customers, and this included contacting around 8,000 home loan customers who we thought were most at risk. Only 14 needed immediate help.

This is in contrast to some of the unhelpful focus on catchphrases like ‘mortgage cliff’ or ‘mortgage prisoners’.

The reality is the number of mortgages we have in possession, which only happens after a long period of trying to work with a customer, is below not only pre-pandemic levels, but also the 10-year average.

That’s not to suggest some customers aren’t hurting. They are and we are here to help.

My message to anyone who is finding things tough remains ‘please call your bank’.

When customers facing difficulty contact our NAB Assist team early, 90% of them are back on their feet within 90 days.

So overall, the economy might be weaker than last year but it’s still in pretty good shape.

There are plenty of reasons to be confident that things will turn more positive towards the latter half of next year.

Unemployment remains near its lowest level in decades. Our natural resources are a great export opportunity. When I talk to small businesses around the country, I continue to hear stories of ambition to grow. The biggest concern remains the ability to find labour.

And through a sharp rate rise cycle, the housing market has also held up better than most expected.

Perhaps this is of little surprise given the lack of housing supply.

We are not building enough homes for our growing population and over time that can only push up house prices further.

The critical housing shortage has a more significant impact on younger Australians and will weigh on future generations if we don’t get the settings right now.

That’s because having a place to call your own creates opportunity and leads to better economic outcomes.

I recently met a customer on the Sunshine Coast whose development was delayed by 20 years, because of difficulties with land parcel certification. In WA, a developer told me they were still chasing approvals on a proposal a decade after it was first put forward.

These are not isolated cases.

Many companies are required to navigate multiple processes across jurisdictions. Writing a home loan can require different processes based on which state the buyer lives in.

A coordinated response from federal, state and territory governments is needed to implement faster, consistent and simpler planning and approvals. This relates to both land development and residential construction.

I welcome the outcomes of last week’s National Cabinet meeting, particularly the proposal to streamline approvals, planning and zoning.

This is not just for government to solve. Banks, developers and community partners can move faster.

This urgency also needs to apply to solving Australia’s growing social and affordable housing crisis. More than 120,000 Australians are experiencing homelessness every night. As I have said previously, we must find ways to fix this.

There was also good progress on this front at National Cabinet.

NAB wants to play its part and lend an extra $6 billion for affordable and specialist housing by 2029.

We are working closely with community partners like Good Shepherd and the Salvation Army and supporting a range of community and sustainable housing projects, including the Nightingale project here in Melbourne.

Now to my second topic: responding to climate change.

The need for an urgent unified and consistent approach is also true for the transition to a net zero economy.

Today, we released a new report that shows that using Australia’s natural advantages in solar, wind and critical minerals could add up to $435 billion to the national economy by 2050.

But it is how we transition that is most important.

First and foremost, we need to build, build, build. We need investment and labour to drive the renewable projects, have shorter lead-times, as well as a consistent national framework that delivers major green infrastructure projects that have widespread community support.

Australia can reap the benefits of innovation and productivity growth that will lift Australia’s supply-chain competitiveness and put the country on a strong footing as our traditional higher-emitting exports are replaced with new green exports.

When you look at this through the lens of opportunity, it’s exciting. There are big transitions coming, whether that’s in agriculture, construction, manufacturing, the service sector or energy.

And while there is complexity in this transition, taking action on climate change is everyone’s job.

The cost of inaction is also too great to ignore. All-too-frequent natural disasters are a stark reminder.

At NAB, we recognise our role. We have been the leading renewables financer in Australia for a long time. Around three-quarters of our power generation financing is already directed toward renewables.

We are working with our customers in planning for the transition. We all know what’s required, and it’s our job to support our customers to get there, not tell our customers what to do.

These are a couple of the topics top of mind for us as a bank, because they are top of mind for the communities we operate in.

I look forward to talking with Leon and taking your questions.

Thank you.