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Thursday, 9 March 1961

Mr McIVOR (Gellibrand) .- I rise to support this censure motion, and in doing so feel confident that I have the backing of at least 65 per cent, of those people in Australia who have the right to exercise their franchise. It is always refreshing to listen to a speech by the honorable member for Cowper (Sir Earle Page), and I was most interested in the references he made to this Government's obligation to house both the citizens of Australia and the migrants coming here. It is pleasing to know that at least one member of the Government is prepared to admit that the Government's credit squeeze is having a disastrous effect upon an already acute housing position.

The Government has offered many excuses for introducing its credit squeeze. Only recently, while in Queensland, I saw in the Queensland press a statement by the Treasurer (Mr. Harold Holt) in which he blamed the banks for placing the Government in the present invidious position in which it finds itself. I noticed also that the Minister for Supply (Mr. Hulme) attacked the retailers for buying all these luxury goods that are coming into the country. But forgot to mention that the Government --] -I have prevented all this by re-imposing import restrictions. The further the position deteriorates, the more frantic does the Government become in making excuses designed to placate the people and have them believe that all is well. But not one member of the Government can deny that the recent drastic growth in unemployment, increase in bankruptcy and collapse of the home-building industry are all due to this vicious credit squeeze. To-day, the Acting Prime Minister (Mr. McEwen) said, " The economy of this country is affected by the winds of change ". It would have been more appropriate if he had said that the economic policy of this Government is a torpedo of disaster. There can be no denying that the policy now being applied by the Government represents a complete somersault from what both the Prime Minister (Mr. Menzies) and the Treasurer advocated in February and August last year. Further, it cannot be denied that the Government hastily imposed blanket restrictions on the nation without first considering what effect such action would have on certain industries.

I say without hesitation that this credit squeeze has hit hardest the very industry which the right honorable member for Cowper has just declared that we should foster - the building industry - and this in the face of all the Government's boasting about prosperity unlimited. Only as recently as February, 1960, the Prime Minister had this to say -

Much that is going on in industry, trade and construction is undoubtedly sound and beneficial. We do not want to check or impede this.

Can any member of the Government say with any degree of honesty or sincerity that industry, trade and construction have not been checked or impeded by this Govern ment's financial restrictions? He certainly cannot! On 16th August, 1960, the Treasurer said - lt is common ground with all of us that we want to see a strong and continuous growth of population and industry, rising standards of living, full employment of labour and such a degree of stability as will promote those aims and safeguard the share in the gains of progress to which everyone is entitled.

How can we hope to cope with a continuous growth of population if we are not prepared to provide the people with decent living standards and homes? How can the Government expect to improve standards of living if it alters its economic policy continually? Again, how can every one share in the gains of progress while unemployment is becoming rampant in the community?

I turn now to the other side of the picture and say at once that I propose to address myself mainly to the subject of housing. At times, 1 have heard mention in this House of economic priorities. I have no hesitation in saying that it is essential to the welfare of any community that first priority be given to the provision of cheap money for home building. I want to see finance made available on terms that the worker can afford, and a virile and unrestricted housing programme. A properly controlled home building programme would overcome many of the economic problems which face us to-day.

I shall now refer to some of the trends that have been apparent in our community over the last two years. The current economic squeeze was not just brought down in November but had been apparent in the community for a long time previously, lt has been insidious, creeping on industry and home building and affecting those people who want to build homes. It has now practically destroyed them. On 27th October, 1960, the Deputy Director of the Housing Commission in Victoria, Mr. Gaskin, appeared before a parliamentary committee which inquired into the distribution of population. He was asked how the Housing Commission would fit into a plan for decentralization and he said the commission did not at present have the money to satisfy the demand that would come for new houses with the establishment of new industries in country areas. He said that the allocation of funds to the commission had been substantially reduced in recent years, money being diverted into other channels, and that expansion to-day could be achieved only at the expense of a decrease elsewhere in the housing programme. That was on 27th October, 1960. Yet, in spite of the fact that the State housing instrumentality gave those facts to a parliamentary committee, this Government saw fit to impose an economic squeeze which has cut the ground from under the feet of home builders and has practically destroyed the building industry throughout Australia. As members of the Government may want to deny that fact, I will read later from submissions made to the Liberal Premier of Victoria by the Victorian Home Builders Conference on 28th February, 1961.

Let us come now to the present day. This Government states that the economic squeeze has not done anything to hurt the worker or to hurt industry, but in "The Sun " to-day we read these headlines: "Textile Crisis Claimed, 1,000 lose jobs", ; Carpet Mill Puts 160 Off", " Meat Industry Dismissals ", and " Seven Timber Mills Forced to Close ". What a shameful contradiction! What an indictment of a government which goes round the country talking of prosperity unlimited! Let us look at how this credit curb is hurting the building industry. In the Melbourne " Herald " of 31st January last, we read -

One builder said that unless the Government acted to allow first mortgage money to be freely obtained the position must become worse.

Tn the Melbourne " Age " of 21st November, 1960, we read -

Prospective home builders were being advised that it was a bad time to build and were cancelling their plans to do so.

That statement was made by the general manager of Contemporary Homes Proprietary Limited, Mr. R. V. Fenwick. It was said that home builders were cancelling their plans to build and that the construction of houses had dropped by 50 per cent. I will now quote the Liberal Premier of Victoria, Mr. Bolte, and surely no one will suggest that he would tell lies or that he would say anything to hurt the Federal Liberal Government. But he has been forced by circumstances to say these things. In the Melbourne "Herald" of 1st February last, he is reported as having said -

The housing industry is the key to the overall economy.

Even Mr. Bolte could realize that fact, but the Commonwealth Government's economic and financial experts do not even know it. Mr. Bolte continued -

Unless it is healthy, sound and progressive, you can run into untold difficulties.

The report continues -

The Minister for Housing, Mr. Petty, said to-day that the easing of housing finance within the next month or so was essential to avoid not only unemployment in the building industry, but deterioration of Victoria's acute housing position.

I give Mr. Petty and Mr. Bolte credit for telling this Government those things for some considerable time. Members on this side of the House have been telling the Government those things also, but nevertheless it has seen fit to put a blanket restriction over this country without even trying in a small way to cushion its impact on home building in Australia.

I said I would give some indication of the position in Victoria. I refer now to a submission put to Mr. Bolte on 28th February, 1961, by the Victorian Home Builders' Conference. It reads as follows: -

The Victorian Home Builders' Conference wishes to make the following submission in relation to the present crisis in the home-building industry and its ancillaries in Victoria.

Yet this Government claims there is no crisis. The submission continued -

We wish to emphasize that members of the Conference are largely concerned with contract home building and are not involved in the speculative field. Ninety-five per cent, of their work in housing would be on a contract basis. The crisis in the industry has reached a point where mass unemployment must occur unless remedial action is taken to ease restrictions on long-term housing finance. Tt is estimated that 150,000 people throughout Victoria depend for employment on the building and supply industries.

Yet the Government tries to tell us that all is well within the building industry. The submission continued -

Seventy-eight thousand of these could find their jobs in jeopardy if steps are not taken to help the recession-

Prosperity unlimited! Prosperous Australia! We read, further -

The present crisis is a result both of the more selective and restrictive attitude to housing finance adopted by State lending authorities last year, and of the Federal Government's current credit restriction policy. The Victorian Home Builders' Conference is strongly of the opinion that a revival of the home building industry can only be brought about by an early easing of restrictions on long-term housing finance.

That is something of which we on this side of the House have been trying to convince the Government for some considerable time. We saw what was going on and we knew it needed only a push for the whole thing to collapse altogether. The Victorian Home Builders Conference said further that the position of the building industry has been steadily worsening since early 1960 when long-term finance began to dry up, all due to the tight credit restrictions imposed on this country. The submission of the conference to Mr. Bolte continued -

Not only were the State and Commonwealth banks conservative in their housing loan allocation, but about that time most of the large insurance companies decided, by policy, to withdraw temporarily from the long term housing mortgage field. At the same time, there was very little money coming from the government-sponsored Homes Finance Trust. Co-operative housing societies and permanent building societies had virtually dried up as sources of housing funds.

That is the background, and it is a sorry tale. The submission continued -

Builders therefore in the latter period of 1960 were relying almost entirely on long term monies from the Commonwealth and State banks. Because of the ceiling of £2,750 on these loans and because of the necessity to trade on as low a deposit as possible, builders developed a rather complex system of second mortgage monies procurement during 1960.

The source of most of this money was the hire-purchase companies. Members of the Opposition have been telling the Government repeatedly that people have been forced to obtain money to build homes from the hire-purchase companies which has meant that instead of paying 5 or 6 per cent, they have had to pay 10, 12 and even 15 per cent, interest. The honorable member for Parkes (Mr. Haylen) had the personal experience of approaching an insurance company on behalf of a client and being told that he could have as much money as he wanted at 15 per cent. Let us read further -

Their position became quite serious in November when Mr. Holt announced measures to further curb the use of credit. Many builders who had been experiencing the boom had been caught in circumstances peculiar to their own operations.

No truer words were ever spoken. Circumstances in the building game are peculiar and can only be safeguarded by good legislation. This Government has had the opportunity to do so but has failed. U stands indicted for being responsible for the collapse of the building industry. The report further informs us -

A number of major home-building organizations in Melbourne - United States Constructions, Evandale Homes, Southern Constructions, Clayton Timber and Trading and Hancock Constructions Proprietary Limited- companies which, incidentally, are located in the electorates of Liberal members who, if they were sincere and honest, would be concerned at what has been going on - have been so concerned at the situation that they have formed the Interim Council of Victorian Home Builders' Conference. These organizations between them build 75 per cent, of " estate " homes in Melbourne and probably upwards of 50 per cent, of all homes in Victoria. Each of them operates on the basis of developmental moneys, institutional loans and second mortgages. Each of them was in a rapid state of expansion which precluded any chance of liquidity. Each relied heavily on the provisions of second-mortgage finance from hire-purchase companies.

The building industry, as is traditional in Australia in boom periods, is in the vanguard of development and is therefore particularly vulnerable to economic trends.

The building industry affects a host of ancillary industries ranging from sawmilling through to hardware manufacture and, as such, affects the work force which could be estimated at over 150,000.

Now let us look at the summary which is in these terms» -

The building industry in Victoria has reached its lowest ebb for some years.

Yet we are prepared to carry on an intense immigration programme!

Private home construction, particularly by the estate or "brandline" building companies, has virtually stopped. Some companies report an 80 per cent, drop in housing " starts " over the past six months, others a 100 per cent. fall. The recession is making itself felt throughout the industry's suppliers and ancillaries.

Suppliers of construction and furniture timber, bricks, plaster, glass, windows and hardware are cutting production as demand dwindles. Six major and medium-sized estate builders say they will have put off more than 3,000 men by the end of February. It is known, however, that 300 limber workers have also lost their jobs, and retrenchments have been made by a number of employers in building's ancillary industries. A major window unit manufacturer has put off 41 of a staff of 141.

What a tragic state of affairs, and this Government continually tries to tell us that all is well in the community and that we have prosperity unlimited! Now comes the most damning part of all -

More than one building company in Melbourne faces early financial extinction unless remedial action is taken to revive the industry.

That has already happened. Some of the companies that I have mentioned have already become bankrupt, and those bankruptcies and the miseries and disorders that follow them can be laid at the door of this Government.

I shall now cite some statistics relating to home building. In August of last year Evandale Estates Limited started nineteen homes. In February of this year the number had dropped to two. Clayton Timber and Trading Proprietary Limited started 28 homes in August last year but none in February of this year. Hancock Constructions commenced eight homes in August last year but has had none since December, 1960. Southern Constructions which is now out of business, commenced 33 homes in August last year but none in January and February this year. U.S. Constructions commenced 41 homes in August, 1960, but none in January and February, 1961. The report then goes on -

In the July-September quarter 63 housing permits were obtained. In the October-December quarter there were seven permits and out of a work force of 90 in the July-September quarter only 60 remained in the latter quarter. This quarter no permits were issued.

The report informs us that there has been a 60 per cent, drop in the industry since February, 1960, and in the week 19th to 25th February, 1961, there was a 20 per cent. drop. Yet this Government tries to tell us that all is well!

In February, 1960, 800 building permits were taken out, but by the second week of February, 1961, there were only 168. Castley Brothers, of Oakleigh - a Liberal electorate - reported that between September and November last year their wage bill was £16,500 a month, but in January and February of this year it was only £10,000 a month. I have been informed that the Hilton hotel organization, the vast American international hotel chain, has dropped its £32,000,000 expansion scheme in Australia. This indicates the lack of confidence that the Government's economic policy has created, not only in Australia but also beyond our shores.

I do not have the time at my disposal to give the House many more facts which would convince Government members that it is time they stopped trying to fool the people.

Mr DEPUTY SPEAKER - Order! The honorable member's time has expired.

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