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Thursday, 11 November 1948

Mr LEMMON (Forrest) (Minister for Works and Housing) . - in reply - I wish to reply first to a point raised by the honorable member for Darwin (Dame Enid Lyons). The honorable member has always contended that she endeavours to see the good points in any legislation brought before the Parliament. I remind her that the purpose of this bill is to appropriate an additional £14,000,000 to enable- further advances to be made to the States for the specific purposes set out in the Commonwealth and State Housing Agreement. The honorable member appears to believe that some alteration of the terms of that agreement have been made since it was first negotiated in 1945, that the original agreement did not contain provisions for sales to be made, and that our consciences, having been newly awakened, we have recently inserted such a provision in it. Such a belief is entirely wrong. The agreement which now operates is exactly the same as the agreement made in 1945. Under it, provision has been made for sales to tenants.

Mr Spender - With the consent of the Treasurer in writing?

Mr LEMMON - No. The States have to obtain the written consent of the Treasurer for sales below capital cost. Under the agreement, sales may he made to tenants only. The States are not permitted to sell houses to people who do not live in them and who desire to become landlords. Sales are restricted to people who wish to become home-owners.

Finance for the purchase of such homes is provided either by the State finance authority, by co-operative building societies or by the Commonwealth Bank. In the case of ex-servicemen, finance is provided by the War Service Homes Commission. Where a tenant has been in. possession of his home for a specified period the total payment of that portion of his rent which is allowed for amortization is rebated to the tenant in reduction of the capital cost of the home. We have done everything (possible to enable tenants to become home-owners. On the 5th June, 1948, the Prime Minister wrote to the State Treasurers indicating his desire that they should proceed with the selling of the homes built under the scheme. Many of the States are now in the process of effecting sales to tenants.

The Leader of the Australian Country party (Mr. Fadden) complained of the continued imposition of sales tax on home-building materials and fittings. The Acting Leader of the Opposition (Mr. Harrison) referred to. the imposition of sale? tax on baths, sinks and builders' hardware. No sales tax is imposed on baths, sinks, bricks, timber, riles and coppers. Indeed, no sales tax is imposed on. most of the materials, fittings and fixtures used in the construction of a home. It is true that sales tax is imposed on a few items, including nails, but their total cost would not represent more than .3 per cent, of the cost of a house. The sales tax of 10 per cent, on requirements that represent only 3 per cent, of the total cost of a home would amount to only a few pounds. Probably as many nails are used in box factories as in home construction. The sales tax is still imposed on bolt's and nuts; but how many bolts and nuts are used in the construction of a house? No items which are now subjected to sales tax at the 10 per cent, rate are solely used in the construction of homes. Reference was also, made te the statement, alleged to have been made by fi member of the Government that the Government did not desire to create " little capitalists ". I have pointed out that the Government is making every endeavour to encourage home ownership. At the commencement of his speech, it was apparent that the Acting Leader of the Opposition had a guilty conscience, for he said that honorable members on this side of the House would probably reply to his criticism by harking back to the past and contrasting what is now being done with what was done when the Opposition parties were in office. The Leader of the Australian Country party criticized the New South Wales Government, which he stated, undertook to build 30,000 homes a year. No promise was ever made by the Premier of New South Wales that the New South Wales Housing Commission would build 30,000 homes. He said that, as the result of the combined efforts of private and. governmental agencies, it was hoped to build 30,000 houses in New South Wales. He has succeeded in having 15,400 houses built. When the governments formed by the Opposition parties were in office, they did not build a single house, notwithstanding their promise to provide £20,000,000 for housing. The Premier of New South Wales fixed a target of 30.000 houses and, at least, succeeded in having more than half that number built. That is a better result than the sorry history of the promises made by honorable members opposite.

I propose now to deal with the increased cost of construction. No one denies that housing costs have increased tremendously. During his secondreading speech, the Acting Leader of the Opposition, said that he had received certain information from the Commonwealth Statistician in. regard to the cost of construction by private individuals and by governments, but that he had to go deeper in order to have those costs dissected so that he could ascertain the position. The honorable gentleman also claimed that the figures were presented by the Commonwealth Statistician in such a way as to hide the facts. In fact, a breakdown of the cost figures furnished by the Commonwealth Statistician was supplied to him by my department. The fullest information has been made available to him and to honorable members generally. The figures are furnished to the press from time to time in monthly housing reports issued by my department. We have never denied that there has been a great increase of costs. The figures published by my department every quarter show the rising trend very clearly. We admit frankly that since 1939 the cost of home building in Australia has increased by approximately 100 per cent. Australia, however, is not the only country in which home-building costs have risen steeply. According to information furnished to the Town Planning Conference, held at Zurich in June last, homebuilding costs in various countries have increased as follows : -

Some of those countries were not directly affected by the war. The Acting Leader of the Opposition complained about the Commonwealth entering the housing field although, as a matter of fact, the Commonwealth's part is confined to providing the money. He also complained about the activities of the State housing commissions, and said that all houses should be built by private enterprise. Nevertheless, on many occasions, those who are about to build factories ask that a housing settlement be established in the area under the Commonwealth and State Housing Agreement. The Acting Leader of the Opposition and his supporters cannot have it both ways. He also said that the delay in providing houses was caused by the scarcity of materials. He cited figures relating to some materials, but he did not mention that the production of certain other materials had increased by more than 200 per cent. He mentioned the production of ordinary burnt bricks, but he did not refer to the production of cement bricks and prefabricated canite, which are now being used in the construction of houses. He claimed that the production of tiles was lagging, but the figures he cited referred only to terra-cotta tiles. He omitted to mention that the production of terra-cotta tiles and cement tiles was 70 per cent, higher than before the war. A little later in his speech, he abandoned his theory that the housing shortage was due to the scarcity of materials. He said that the fact that some builders were advertising for carpenters and bricklayers proved that plenty of materials were available, and that the real trouble was due, to a breakdown, of the Commonwealth reconstruction training scheme. E suggest, that he should make up his mind about, what he. thinks is really responsible for the situation, of which he complains ?'

Mr Duthie - Is it true that 19,000 ex-servicemen have qualified under the reconstruction training scheme?

Mi-. LEMMON.- It is quite true. The Acting Leader of the Opposition quoted from a letter written by a partially blind man, who had obtained a permit from the Department of War Organization of Industry to build a house. He had obtained the necessary finance, and had entered' into a contract with a builder to erect the house, but the builder had defaulted. Well, surely he cannot blame the Commonwealth for that. If the house in question had been a war service home, the War Service Homes Commission would have got another builder to do the job or would have done the work itself. If the man had been blinded or otherwise incapacitated during his war service, he would have been given a first priority for the construction of his home. Apparently, however, this unfortunate man had to depend upon a private builder. If the permit was issued by the Department of War Organization of Industry, it must have been' not later than 1945. It is now 1948, and the man is still without a home. The story, as told by the Acting Leader of the Opposition, merely demonstrates the failure of private enterprise;

The Acting Leader of the Opposition further complained that housing programmes had not been fully carried out. It is true that certain objectives were set,, and it is good to set a high objective'. lt must be remembered:, however, that the programme provided merely that the building of a certain number of houses should be begun. It was known that there would be considerable delay in the completion of the houses, but the position has improved so much that the completion rate is close to the commencement rate. Last year, 43,635 dwelling units, including 7 68 flats, were completed by Commonwealth and State housing authorities, and by private builders. The Commonwealth was directly concerned with the erection of war service homes only. That is the largest number of dwellings built in Australia in a year since. 1927^ The average number constructed each year during the ten years beforethe Labour Government came into, office was only 27,000. By the. end. of the present financial year, it is expected that between 48,000 and 50,000 more dwellings will have been completed.

The Acting Leader of the Opposition mentioned a number' of things which, he said, should be done in order to hasten the construction of houses. He said that we should appoint, a business executive to control and direct housing construction. Under the Commonwealth and State Housing Agreement, the actual construction of houses is the responsibility of the State housing authorities. In two of the States, the housing authorities function under the direction of Liberal governments. If those governments wish to appoint business executives they are free to do so. Certainly, .the. Commonwealth cannot prevent them from doing so. I suggest that the Acting Leader of the Opposition should discuss the matter with hia colleagues in the Liberal Governments of Victoria and South Australia. He also blamed sales tax as- a factor- delaying the construction of houses, but his argument in that respect has been completely exploded. He touched upon the subject of home ownership, and I have already explained that the agreement provides that the occupants of houses constructed under the agreement may purchase them if they desire to do so. As a matter of fact, the Treasurer (Mr. Chifley) has encouraged the State housing- authorities to sell the houses that, are built under the agreement.

Slum clearance was the next subject discussed by the Acting Leader of the Opposition. As I have already mentioned, he also complained of the scarcity of building tradesmen. Well, does he suggest that tradesmen, who might be employed on the construction of new houses, should be used to pull down houses already existing? In my opinion, this is not the time to undertake slum clearance. The policy of any government interested in providing, homes for the people should be to use all available labour find material for the construction of new dwellings, so that the young people who now have to live in slums may be able to move into other areas as soon as possible. The time for slum clearance is not when there is a general scarcity of houses, but when there is a reserve of labour and materials for which an outlet is sought. The Government is determined that never again will people go without homes because of a shortage of money. The only thing that limits our ability to provide homes is the physical capacity te build them.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clause 1 agreed to.

Clause 2 (Authority to borrow £14,000,000).

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