Govt dusting off old savings plan: Labor

Cabinet minister Matt Canavan says the government is "alive" to the issue of housing affordability but won't confirm the May budget will include a new saving plan for first home buyers.

News Corp reported on Sunday the new plan to help people save would be similar to salary sacrificing, speeding up the time it takes to save for a deposit.

"We are focused on making sure Australians can afford a home, it is a fundamental principal of the Liberal-National government people," Senator Matt Canavan told Sky News on Sunday.

Treasurer Scott Morrison has flagged housing affordability as a key part of the May 9 budget.

Opposition frontbencher Mark Butler said the government was dusting off a Labor policy it abolished in the 2014 budget.

"I think it's fair to say that the first home owner grant scheme that we put in place didn't have time to show itself," Mr Butler told ABC television.

"But the critical message is this: you cannot deal with housing affordability in Australia without dealing with negative gearing."

He said until the government dealt with that, any housing affordability policy would be a "sham".

Greens senator Sarah Hanson-Young agreed.

"Just putting more money into the bidding process isn't necessarily going to reduce the cost of housing," she told ABC television.

"We have to bring the pressure down, not just give people more money to go straight into the hands of property investors."