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Friday, 5 December 1986
Page: 3506

Senator RICHARDSON —My question is addressed to the Minister representing the Minister for Defence. What is the Government doing to ensure improved housing is provided to Australian defence personnel? Will the Government be taking any notice of the policy of the Opposition spokesman on local government and administrative services that defence housing should be privatised?

Senator GARETH EVANS —I am able to say on behalf of the Minister for Defence, Mr Beazley, that this year the Government is providing $66m for defence housing-up 20 per cent on last year and vastly more than the amounts spent by the Opposition in government. Indeed, the problem we face of one-third of defence houses requiring replacement stems directly from the `Garland freeze' in housing expenditure during the Fraser Government. This Government is in the process of establishing a statutory authority to manage on a commercial basis the 22,000 houses the Defence Department controls. An interim board is to be established in the next month under the chairmanship of Mr John Graham, a former managing director of Civic Constructions Pty Ltd and now a director of that firm and in 1983-84 the National President of the Housing Industry Association.

The authority will seek to negotiate ownership of the 14,000 houses owned by the States and leased by the Commonwealth for defence personnel. It will have the power to buy and sell properties and freedom from other Public Service constraints. This will enable the cheapest possible provision of houses. Reducing costs is particularly important because the return on these houses is low. Service families' rent is subsidised to compensate them for the frequent moves and the requirement to live near base. Another important factor is the averaging of rent whereby service families can be moved across Australia at short notice and be confident of paying the same rent in all locations. Currently, subsidies are in the order of $75 a week, though this obviously varies widely between locations, ranks and particular houses.

As to the policy of the Opposition as announced recently by Mr Tuckey at a lunch at the Hilton Hotel, where he invited property developers and other investors to tell him which Commonwealth properties they would like him to flog off, it was clear that he made a very special effort to announce the Opposition's intention to get rid of defence housing. In his push for privatisation, Mr Tuckey would obviously appear keen to transfer the subsidy given to service families to the profits of the companies that he wants to sell the houses to. Under his plan, service families could expect to pay market rents-that is an average of $75 a week more than they are paying at the moment.

So, in answer to Senator Richardson's question, I can say quite specifically that the Government has no intention of adopting that kind of Opposition policy. I make it clear on behalf of Mr Beazley that the Government completely opposes the idea that defence housing should be sold off and costs of the housing increased to pay profits and increased management costs. The authority that we are setting up will reduce management costs to a minimum and, with the large capital allocations provided in successive Budgets, deliver the urgently needed improvements in service housing.