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Tuesday, 8 March 1966

Mr McMahon - On 26th November 1965, the honorable the Leader of the Opposition (Mr. Calwell) asked a question without notice concerning a claim that at least £75 million of bad debts is owing to hire purchase companies in Australia. My predecessor mentioned in his interim reply that the information as to the total losses estimated in hire purchase transactions came from Mr. E. A. Edwards, who is Federal Chairman of Australian Finance Conference Ltd., and although he did not know pre cisely the source of the information he undertook to check whether he could provide further information.

By letter dated 15th December 1965, my predecessor (Mr. Harold Holt) gave the Leader of the Opposition the following additional information -

There are no official statistics available that would enable me to comment on the bad debt experience of hire purchase and finance companies whose activities are basically subject to State legislation.

However, Mr. Edwards has since written to me to elaborate on the reference to the amount of £75 million that first appeared in an article published under his name in " Retailer News ", the electrical trade journal. Mr. Edwards has claimed that the article has been the subject of misleading press reports and he has provided the following comment:

The estimate of $75 million was based on announcements of losses by companies, principally in the retailing field or areas controlled by merchandising groups, between 1961 and 1965 which, in many cases, stemmed back to business written in the 1950's. Although the first paragraph of the article in question in "Retailer News" mentioned bad debt write-offs, the total, in fact, included certain trading losses. The list from which the estimate was taken included more than eighteen companies or groups of companies such as the Reid Murray Group, the H. G. Palmer Organisation, Latec Investments, Australian Factors and such retailers as Buckinghams, Anthony Horderns, A. 1. Benjamin and Cox Bros. The estimate did not involve non-retailer finance companies in the Australian Finance Conference whose operations represent the major share of non-retailer financing business in this country.

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