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Wednesday, 22 October 1919

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) . - I move -

There are no new principles in the measure, beyond an amendment to allow war workers, munition workers, and others to participate in the benefits of the principal Act, and a provision to prevent estate agents, or similar persons, from using the term "war service homes" as an advertisement. The Bill makes it an offence to use the term for advertising or other purposes, except with the permission of the Minister. It is not right that people should exploit the war service homes legislation of Parliament for their own purposes. The provisions relating to war workers, munition workers, and others enable the benefits to the Act to be extended to them all,' with the exception of those who have had their agreements terminated during the course of the war by the Minister owing to some fault of their own. Every other war worker who was sent away under agreement with the Government will be included.

Mr Tudor - What about those who are returned sick ?

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) - The Bill applies to every person who has served the Imperial Government and the Ministry of Muni tions during the war, and "whose agreement with the Commonwealth, or the Minister of State for Defence, was not determined by reason of his failure to observe and perform any term or condition contained in the agreement, or by reason of his dismissal from any work in Great Britain during the continuance of the agreement because of any conduct of the worker which, in the opinion of the Minister, was such as to justify the determination of the agreement." The disqualification would not apply in a case of sickness or other disability which was not the fault of the worker. The remaining clauses contain only technical alterations, which have been shown by experience to be necessary in theadministration of the Act. A number of difficulties have arisen in some cases owing to the faulty drafting of the original measure, and in others to circumstances that were not anticipated when the Act was originally framed.

The amendment of section 4 of the principal Act, made by paragraph a of clause 2 of the Bill, is necessary in order to impose upon a person executing a mortgage under sub-section 6 of section 19 the duties and obligations of a borrower under the Act. Mortgages are sometimes taken over by the Commissioner under the Act. The law authorities hold that the mortgagor in that case does not come within the definition of " borrower " as it stands in the original Act, a borrower being defined as one to whom an advance has been made. In this instance, technically, there has been no advance, as a mortgage has merely been taken over. The remaining parts of the definition clause simply make munition workers and war workers eligible for homes and advances under the Act. The number of munition workers, including chemists and constructional draftsmen, engaged in the Ministry of Munitions, is 3,053. The number of war workers, such as labourers, fettlers, and navvies who were doing work either at the Front or in connexion with war-like operations, is 2,243. These together add 5,296 to the number of persons eligible for advances under the War Service Homes Act. It is provided that war workers whose services are not satisfactorily terminated shall not be eligible for benefits.

Clause 3 is necessary for the following reasons: As section 16 of the Act stands at present, it applies to land whether acquired by agreement or by compulsory process. It is practically impossible to obtain, by agreement, land free from all trust charges, &c. We can do that when we compulsorily acquire land, but not otherwise. The proposed amendment will restrict the section to land acquired by compulsory process. Land acquired by agreement will become vested in the Commissioner in the ordinary way as matter of transfer.

Mr Richard Foster - What is meant by compulsory acquirement? Does that refer to the Commonwealth or the States?

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) - Under the War Service Homes Act, the States do not compulsorily acquire the land; that is done by the Commonwealth. The acquisition of land for the settlement of soldiers is carried out by the States, the Commonwealth merely undertaking the finance. But in regard to land for War Service Homes, the land itself is dealt with by the Commonwealth. Consequently, it becomes necessary in some cases, particularly where it is proposed to . have group settlement, to acquire a considerable area. This gives us power to compulsorily acquire land.

In regard to clause 4, it has been found impracticable to compute, in the manner prescribed in sub-section 5 of section 19, the weekly payments due by the purchaser, and it is considered preferable that the computation thereof should be left for determination under section 29, sub-section 1, and other sections of the Act. Further, it is considered that the provision that a purchaser occupying a dwelling house of the Commissioner should be extended to cover persons to whom -an advance has been made. .

Sub-section 6 of section 19 at present provides that when a purchaser has paid in reduction of the purchase money onefifth of the amount, and has paid the1 amounts due up to that time by way of instalments, and has. complied with the conditions of the contract of sale, he may execute a mortgage to the Commissioner for the balance of the purchase money. But, owing.to the following circumstances, it is considered desirable that a new subsection should be substituted, viz., 1, other moneys besides those due by way of instalments are payable under the contract of sale; that refers to survey fees, release of mortgages, stamp duty, &c, and it is necessary to provide for those as well as the actual land fees, the whole being a debt owing by the purchaser; 2, conditions are prescribed by the Act and regulations as well as the contract of sale; 3, the repayment of other moneys besides the purchase money should be secured by the mortgage given by the purchaser; and, 4, the last sentence of the present sub-section 6 appears to be unnecessary, and, if read literally, would prevent a purchaser obtaining a transfer on payment of the purchase money ki full. What we desire to do is to give a transfer entirely to the purchaser as soon as his obligation has been fulfilled. The present section does not allow that to be done, but that was never intended.

The additional words proposed to be inserted in sub-section 9 of section 19 appear to be necessary to bring the provision with regard to interest into line with the definition of capital cost. The whole of the amendments to section 19 are intended to tighten up the section and facilitate administration.

Clause 5 amends section 29. It is proposed in paragraph a to insert additional words, without which the Commissioner would be bound to make payments of principal equal throughout the whole term, and to add to those the varying amounts of interest from time to time due at the date of each instalment. That would give rise to a great deal of unnecessary calculation, and of work that it is desirable to avoid. Moreover, the purchaser would not. know exactly what amount he would be required to pay each time.

Mr Richard Foster - You are adopting a Credit Foncier system ?

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) - Yes. The ordinary building-society method of making equal payments, which include principal and interest, appears to have been the intention; but without the additional words, that intention cannot be carried out. The Act as it stands limits the repayments te weekly, fortnightly, and monthly instalments. That limitation has been found inconvenient. The .amendment proposed in paragraph 6 of clause 5 will enable instalments to be made in accordance with the contract of sale at such intervals as are thought fit. That is to say, each purchaser can arrange to pay quarterly, half-yearly, or at any other interval that suits his own convenience. The extent sion of the period over which instalments. are payable under the contract of sale or mortgage of a dwelling-house to be erected, composed of wood or iron, from twenty to twenty-five years, is required, because it is considered that the provision of section 31 will insure that the' house is kept in good and substantial repair for that period. As regards houses of this type already erected, the policy of the Commission will not be altered as. the period of training is determined after taking into consideration the state of repair and the probable life of the dwelling house. That is really done in the soldier's interest, and gives him a longer period than he would otherwise have for repayment.

Clause 6 is a new clause,- suggested in lieu of section 19, sub-section 5, covering both purchasers and borrowers. The conferring on the Commissioner of the powers under other laws is usual in mortgages, and would facilitate the obtaining by the Commissioner of possession of the land should a purchaser or borrower make default in the conditions governing the purchase or advance.

Clause 7 amends section 31. Without the additional words proposed in paragraph a the section would appear to contemplate the full amount being paid to the Commissioner in one payment. That is not required, and it is desired that power be given to enable repayment to be made by instalments.

In regard to paragraph 6, the words proposed to be omitted are inappropriate to the circumstances, and the suggested words are necessary in order to bring the section into line with section 18. The limitation on expenditure applies to the Commissioner, and not to the purchaser. The amount of purchase money payable by the purchaser is limited by section 19, which defines capital cost.

The amendments proposed in clause 8, paragraphs a and b, appear to be necessary to carry into1 effect the intention of the section that the purchaser or borrower, so long as any money is due to the Commissioner, has to remain in occupation of the house.

In regard to clause 9, section 33 of the original Act appears self -contradictory, inasmuch as it contemplates a borrower's title being divested, from him, and thereafter a subsequent sale by the Commissioner of the borrower's estate and interest. It is also desirable that the sec tion shall be extended to provide for the insolvency of a purchaser as well as of a borrower, and for the nonapplication of the insolvency laws to the dwelling house, and that the section should be extended to cases in which the dwellinghouse is seized in execution of a judgment debt. In any of such cases it appears to be desirable that powers similar to those given by sub-section 2 of section 32 should be vested in the Commissioner.

Clause 10a amends section 35. As the section now stands, read literally, it would invalidate a transfer by the Commissioner under other sections of the Act. The additional words, therefore, appear necessary. The amendment in paragraph b is consequential on the amendment of section 33.

With regard to paragraph c, at present the transfer to the devisee only is to be recognised, and the only case in which there can be a devisee is that in which the purchaser or borrower has left a will. In that case an administrator would be an administrator "with the will annexed," and if he is not such an administrator he could not be a devisee. It is, however, desired that an executor or administrator should have power of disposition of the dwelling-house in the ordinary course of the administration of the estate, and the words " to a devisee " should, therefore, be omitted. That is to say, whether or not there is a will, the administrator of the esr.ate is to be empowered to deal with the house. At present he cannot do so. Paragraph ti! corrects a printer's error. Section 35 as a whole applies to both, purchasers and -borrowers. Sub-section 26 (i) and (ii), however, only applies to a borrower. The amendment in paragraph e is necessary to apply these subsections to the purchaser. A number of these amendments have become necessary, because- it was not recognised when the original Bill was drafted, that not only would homes be built, but arrangements would be made to purchase houses already built.

In regard to clause 11, the present insurance scheme relates to dwelling-houses only. The scheme provided by the new clause will enable not only dwellinghouses, but also all material on house sites for the erection of homes to be insured. As the law stands at present, an insurance policy cannot be effected on the material with which the soldier is to build his home.

Mr Burchell - Will the soldier have to pay the premium?

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) - Yes; it will not be a very great amount, but it will be part of the purchase price.

Mr Burchell - Therefore, it will be compulsory for the soldier to insure the material?

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) - I do not think that it will be absolutely compulsory; he may insure if he so desires. Power is also given by the proposed clause to make regulations to do all things necessary in connexion with the insurance scheme. I take it that under those regulations it would be competent for the Minister to stipulate that the material would be insured.

Clause 12 repeals section 41. The only substantial difference proposed is that the insurance money may be applied to make good both damage to and total destruction of a dwelling-house and other property. Apparently as the Act was originally drafted the insurance would apply only to total destruction.

Clause 13 amends section 47, and enables the Commissioner, on the application of the Repatriation Department, to provide a dwelling-house for the use of a totally and permanently incapacitated Australian soldier. A blind soldier may not be totally and permanently incapacitated, and' the amendment proposed by the clause is intended to give him the benefit of the provisions of section 47.

Mr Richard Foster - Do the Government carry the insurance risk themselves?

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) - I am not sure, but I think they do. The last clause is that to which I directed " attention in my opening remarks. It simply deals with the wrongful use of the words " War Service Homes " for advertising purposes, and provides that such use shall not be made of them without the permission of the Minister.

Mr Richard Foster - Does the Commonwealth Bank operate the machinery both in regard to building and financing?

Mr MASSY-GREENE (RICHMOND, NEW SOUTH WALES) (Minister for Trade and Customs) - In some instances, yes; but not in all. There is an agreement which enables the Bank in certain instances to build, but the intention is that the Commissioner shall do the major portion of the work in this connexion.

Under the agreement, the Bank will have power in isolated cases to erect certain homes. The Commissioner will not be absolutely limited to the building in group settlements, but his principal activities will rather be directed towards the larger portion of the scheme, leaving to the Bank the erection of isolated homes from time to time.

Mr Richard Foster - Is the test of public tender provided for?

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