Mr BILLSON (Minister for Veterans’ Affairs and Minister Assisting the Minister for Defence) (9:12 AM) —I move:

This bill seeks to further extend the operation of the Defence HomeOwner Scheme (the scheme), from 31 December 2007 to 30 June 2008. The legislative basis for the scheme is the Defence Force (Home Loans Assistance) Act 1990.

Late last year parliament approved the Defence Force (Home Loans Assistance) Amendment Act 2006, which extended the operation of the scheme from 31 December 2006 to 31 December 2007.

The extension of the end date was required to enable Defence enough time to review the current scheme and develop a home ownership assistance scheme that is more contemporary to meet the needs of both Defence and ADF members.

Defence has completed its review of home ownership assistance and the terrific results were announced last night by the government as part of the 2007-08 budget. In essence, the new scheme will have a value of $864 million over 10 years. It is important that this new scheme is supported as it provides ADF members with assistance to achieve home ownership, recognising the difficulty members may have in purchasing a home due to the nature of their career. This will have a significant retention benefit to the ADF, as it is a targeted measure involving progressively higher loan subsidies for those who serve beyond critical separation points.

In essence, the new scheme will replace the old home loans assistance scheme, which we are seeking to extend with this bill. It will provide contemporary and relevant home loan assistance pitched at a level that reflects current prices. It will also provide increasing entitlements as members serve beyond key exit points, based on a 37.5 per cent interest subsidy of a three-tiered loan subsidy limit: four years, up to $160,000—which translates to about $241 a month—eight years, up to $234,000—which is about $353 per month—and 12 years, up to $312,000, which is currently about $470 per month. It will be responsive to changes in the housing market and it will provide flexibility and choice—giving the ADF member choice of mortgage providers instead of requiring a single provider, as was the case under the old scheme.

The extension that I seek today will allow time for action consequent to the government’s announcement to appropriately formalise the introduction of the new scheme. I seek to further extend the end date of the current scheme from 31 December 2007 to 30 June 2008.

The extension will provide the National Australia Bank with continuance of its existing rights as sole loan provider under the act until 30 June 2008, however, and more importantly, will ensure that ADF members’ eligibility to home ownership assistance is preserved. I commend the bill to the House.

Debate (on motion by Mr Crean) adjourned.