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Wednesday, 12 April 1961

Mr HAROLD HOLT (HIGGINS, VICTORIA) (Treasurer) - The honorable member for Wilmot began his question by referring to restrictions of credit for housing. I thought I had made it clear yesterday that the directive from the Reserve Bank of Australia to the trading banks, far from recommending any restrictions on housing loans, stressed that social purposes such as housing should not be regarded as coming within any general directive for particular restrictions to be applied in bank lending. Indeed, the Reserve Bank has since reminded the trading banks of this particular element in the general directive. As a result of the action to which I referred yesterday, further provision has been made by State savings banks and by the Commonwealth Savings Bank of funds for housing purposes, the rate of lending having been stepped up after consultation with the Reserve Bank of Australia.

The extent to which this will occur will vary from State to State and according to the resources available to the institutions concerned. That is a matter over which the Commonwealth has no direct control. However, I am quite confident that the various State savings institutions and the governments of the States concerned are anxious to see some increase in the rate of lending for home building purposes.

The Government is aware that timber mills throughout Australia have been affected by a decline from what was a boom level of home building last year. Again, the situation varies from State to State, but it is not contemplated that we should return to the level of home building activity which was producing pressures of demand, forcing up costs, and leading to scarcities of materials. The Tariff Board has reported in some detail on the timber industry. Those members who are interested in this matter and who have not yet studied the board's findings are recommended to examine its document.

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