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Thursday, 9 May 1985
Page: 1624

Senator RYAN (Minister for Education)(12.19) —A number of points have been made by the Opposition during this debate but I am pleased to note that it will not be opposing the First Home Owners Amendment Bill, and neither should it. Despite the nit-picking comments that have been made at certain points during the debate, it is clear that the first home owners scheme has been the most successful scheme ever established in Australia. It has been the most successful in terms of the number of people it has reached and in terms of reaching the target group of people who would otherwise not have been able to purchase their own homes. Of course, the effects of this scheme on the economy and on re-establishing the building industry generally have been widely acclaimed throughout the industry and indeed throughout the community. I will address myself to some of the points that were made during the debate, those that I think justify a substantial response.

The theme of some of the comments by Opposition senators seemed to be that somehow this scheme was not reaching the most needy people. I remind honourable senators that this scheme is not the only way in which the Commonwealth assists people to be housed. In fact, this is not the scheme designed for the most needy people in the community. The most needy people in the community are housed in public housing. I am pleased to take this opportunity to remind the Senate of the outstanding record of the Hawke Labor Government in respect of its support for public housing-that form of housing which houses the most needy people. These are the people who cannot afford at a particular stage or, perhaps, at any stage to buy their own home but who are still entitled to adequate housing.

I remind the Senate that the combined Federal, State and Northern Territory housing funding for 1984-85 is at a record level of $1,571m. That is 24 per cent higher than for the previous year. In real terms it is a record. It provides some 80 per cent more funds than were provided by the Fraser Government's 1981 agreement. The Federal contribution for 1984-85 was $623m in non-repayable grants, which is up 9 per cent on last year. Grants for the year before were increased by 50 per cent and an amount of $38m in subsidised loans at a 4.5 per cent interest rate was provided under the Loan Council agreement.

I remind honourable senators, in particular Senator Messner, who seemed to be drawing some unfavourable comparisons between our performance in this respect and the performance of the Fraser Government, that in real terms the Fraser Government reduced the Commonwealth's contribution by 60 per cent over the period December 1975 to July 1982. It is very clear that the 1984 Commonwealth-State Housing Agreement was a major initiative of our Government. The 10-year scheme which it set up will constitute a major assault on housing-related poverty. I hope that that has cleared the record in respect of comments made about housing for the most needy. Such people are being assisted at a greater rate than ever before because of our Government's very substantial increase in funds available for this purpose.

In the course of the debate there was some criticism of housing interest rates in relation to this scheme. I remind the Senate that since taking office the responsible economic management of our Government has led to reductions in housing interest rates. The savings bank base rate charged by most banks is 12 per cent. The high priority given by our Government to housing has ensured an adequate supply of housing finance, something this country has not always had. Our initiatives have greatly improved home ownership prospects for low to moderate income earners in Australia. The interest rate of 12 per cent which will now apply to most bank housing loans is still considerably lower than the peak level of 13.5 per cent, which applied between March and December 1982 during the period of the Fraser Government. Clearly, in respect of interest rates there has been an improvement.

Senator Archer —You are on yourself.

Senator Lewis —She is just reading out the notes she has been given.

Senator RYAN —The boys over there will have their way. I guess honourable senators opposite are looking for distractions from this debate. As I have said, this is widely acknowledged as the most successful home ownership scheme ever launched in this country. The inane grumblings that honourable senators opposite engage in cannot detract from that fact, nor can they detract from the recognition of this, particularly by the people who have gained housing. A couple of other points probably require some comment in my response. It was charged that there was some resiling from our election pledge to retain the scheme. Of course, that is not the case. I point out that no class of buyer is excluded. I point out that single people with dependants are tested against higher income limits. Single people without children, who are less in need of assistance, are tested against a lower income test.

It was suggested that the Fraser scheme was better because it required prospective owners to save for their home. That is a very odd criticism to make of our scheme. The savings provisions of the former scheme worked against those people who were unable to save, and of course they are the people most in need. Our scheme does not have such a bias against those who are unable to afford to save. Despite the criticism by the Opposition of the income test it is the case that 87,000 households have been assisted this year and that 82,500 households will be assisted in 1985-86. That demonstrates the extent to which this scheme is able to assist people. I remind the Senate that the Fraser Government's home savings grants scheme in 1982-83 helped only 47,881 people in contrast to the 87,000 people we are assisting this year. I could subject the Senate to more statistics but I think the point is fairly clear. The extent of this scheme is almost double that of the Fraser Government's scheme in terms of numbers.

A comment also was made that the heaviest cuts fall on the most needy home buyers. The income test, which did not apply to previous housing schemes, now targets assistance to those in greatest need. The 87,000 households that will be assisted this year have an average joint income of $17,000. Even honourable senators opposite must be able to grasp the fact that a joint income of $17,000 is a very low income indeed. I repeat that that is the average income of the 87,000 households which will be assisted this year. It is quite clear from the facts, if Opposition senators care to examine them, that this scheme is indeed helping low income families. The point was made also that the Fraser Government spent $300m in one year on the home savings grants scheme and the home deposit assistance scheme. To set the record straight on that, it must be pointed out that this amount of money included a massive payout under the discredited HSG scheme to cover grants withheld during the nine months waiting period. It can hardly be claimed as being a massive new form of assistance to those home buyers.

As I have said, there is no substantial opposition to this legislation. It has been debated thoroughly in the House of Representatives and here. Despite some minor points the Opposition chose to make regarding the scheme, it is quite clear that it is a massively successful scheme and will continue to be so. The fact that the Government has set a Budget limit on the scheme will not mean any erosion of it. Very large numbers of Australians will continue to have the security of being able to purchase their own homes by means of this scheme.

Senator Archer —This is rubbish.

Senator RYAN —It is slightly irritating when facts such as the 87,000 low income home buyers who will be assisted this year are described by Senator Archer as nonsense. The facts stand for themselves. The success of the scheme is obvious. At this point I ask that the Bill be supported.

Question put:

That the words proposed to be added (Senator Lewis's amendment) be added.