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Wednesday, 24 November 1971
Page: 3573


Mr BURY (Wentworth) - The honourable member for Reid (Mr Uren) has followed the same course as he has followed in this House for many years. He assumes that the Government has unlimited funds to spend on, in particular, housing and that resources are unlimited. Having, in the first place, assumed that endless public money is available to do what he wishes to be done he proceeded to argue what could be done with that kind of foundation. But one cannot begin to understand or solve the housing problems in Australia until one has first faced up to the essential reality that resources are strictly limited and that the public money available is, similiarly, strictly limited. The honourable member for Reid is, of course, personally a very kind and generoushearted, grandfatherly figure. He is kind enough to want to do all these things and silly enough to think that they are practicable.


Mr Uren - 1 am glad 1 am silly enough; at least I have a heart.


Mr BURY - 1 have never doubted the honourable member for Reid's heart, but unfortunately the realities of public finance and responsibility are inescapable. One of the things that the honourable member for Reid did not face up to is the fact that the areas available in the inner areas of the larger cities - Sydney and Melbourne in particular - for housing arc strictly limited and are becoming year by year scarcer and scarcer. It is inevitable that as the demand for this land increases the price which has to be paid foi; it will also increase. I am not saying that in defence of all that goes on within this sphere. I am saying it because the real reason why housing is becoming more difficult and more expensive it that land is becoming extremely scarce.

I wish to deal with one or two matters which have been raised if not by the honourable member for Reid certainly at his instigation by the Leader of the Opposition (Mr Whitlam). Firstly, I understand - the honourable member for Reid certainly will correct me if I am wrong - that the Australian Labor Party would if it were in office subsidise the interest on home mortgages by 2 per cent. What a lovely thing to do! Let us examine one or two of the consequences which would flow from such a policy. Firstly, the bigger the mortgage the bigger the subsidy one would receive from the state. Saving would, of course, be no longer a paying proposition. One of the reasons why people save is to pay off their house as quickly as possible. But under such a scheme they would get a 2 per cent interest concession. One can readily visualise that most enterprising people - and these things spread very quickly through the community - would ensure that, whatever else they owned, they had the largest possible mortgage they could have on their houses because, with the lower rate of interest, they could undoubtedly invest their funds elsewhere at a much higher rate of interest. The generous donation offered by the Australian Labor Party would have to come from public funds.

There are other aspects of the Labor Party's policy which it is said would, if realised, ease the problem. The Leader of the Opposition has indicated that if the Labor Party were in power it would institute a public inquiry into the inducement of people to have fewer children. If that policy were successful it would, of course, alter the housing problem. The amount of accommodation required would be very much less. I would like to suggest, as something of a diversion at this point of time, that the tendency to buy propaganda from overseas and think that it is immediately relevant to Australian conditions is both absurd and quite contrary to our national interest. It is true that in other countries - particularly the overcrowded countries, many of which are in our part of the world - the standard of living and of welfare generally is bound to fall if there is no limitation of the population; but that is not true of Australia. In fact, it is starkly and obviously untrue. If we are going to populate this country - and we still retain the ambition to do that in our own time and under our own terms - the best people that we can seek are our own natural-born children.

I think the honourable member for Reid really missed or failed to bring out the main point of this Bill. Over the years there has been under the Commonwealth and State Housing Agreement a 1 per cent concession on interest. That concession has been nominally for the purpose of enabling the States to provide more housing for the lower income groups but, things being what they are, it has been in fact generalised over the whole operations of the housing commissions in the various States and has not been specifically and sufficiently diverted to- the people on low incomes. The way in which this legislation is drafted will mean that such assistance as the Commonwealth gives will go directly and immediately towards providing housing for the lower income groups. In particular it will be directed towards meeting the shortage of cheap rental accommodation for families of inadequate means.

The old system never really achieved this result. That is understandable. In many of the States - in fact, in most of them - housing is essentially provided by housing commissions and the housing commissions are mostly house construction authorities. Being engaged in that operation, what they like to do is to construct as many houses as possible and sell as many of them as they can in order to invest those funds in building still more houses. This is a very understandable approach but it is not one which really aims at the same thing as does this Bill, that is, to provide cheap rentals and cheap housing for those who are most in need. The honourable member for Reid referred to housing commission lists. Housing commission lists are notoriously most unreliable. It stands to reason that the demand for the cheapest house is virtually unlimited. Nowadays housing commissions build good houses in many cases and there is a big inducement for people to sell their houses and get into housing commission houses at a cheap rate. If one goes through these lists - periodically the people in charge do go through them - one finds that they are very much padded. If one went through them with an eye to the income received by those 37,000 applicants, one would form a very different impression of the demand.

The Bill provides direct assistance to the States. It is true - the honourable member for Reid touched on this lightly - that the first reaction of the States was not one of pleasure. This is understandable, because at first they did not precisely understand the proposal. It so happens that in South Australia, which has a Premier of the same political persuasion as the honourable member for Reid, there is an extremely capable and efficient housing set-up. The man who is in charge and has been for many years, Alex Ramsay, commented publicly on these proposals immediately he heard them. I think that his comment was published in the 'Advertiser' of 19th August, very hard upon the Budget. He realised immediately what benefits they would bring to the States and recorded his comments publicly to that end. On 20th September Mr Dunstan, the Premier, quantified the proposals and said: "This new deal means that the concession on housing going to the States will be raised from I per cent to nearly 2 per cent". Th;s was just a quick reaction.


Mr Uren - The difference between 3 per cent and 7 per cent is 4 percent.


Mr BURY - I am quoting this figure from Mr Dunstan. Mr Dunstan is advised by people who calculate proposals with much more exactitude than the honourable member for Reid does. That is what he said. Of course New South Wales welcomed the proposal. 1 realised this from the reactions. There were some slower heads in other States but when the facts were explained by the Minister for Housing (Mr Kevin Cairns) they were very anxious to welcome the scheme. Unfortunately the census figures in relation to housing, which will be very revealing in this respect, are not yet out. We are not able to see them yet. But when we do, it will be very interesting to comb through them. lt is fairly evident to me at least that Australia, whatever its deficiencies, now has the best housed people in the world with more accommodation - and quite high quality accommodation - per head than any other country. If when the census comes out this cannot be confirmed I will withdraw that statement. But this is clearly the position at present. The housing industry is in quite good shape. Housing programmes in most States are continuing. Plenty of money is currently available for housing. But there is perhaps evident some slight falling off in demand and this is probably due to the underlying factor that we have invested such a huge proportion of the national income in housing in the last 20 years that we have caught up very largely with the huge stream of immigrants and at the same time have greatly increased standards.

This position at the moment means that people are looking very closely at the costs. Costs are rising for various reasons. Apart from the scarcity of land there has been a huge increase in wages in the last 12 or 18 months which has added to costs. There has been an increase in the cost of building materials. Other factors enter into it. But also, in order to pay for these things, there has been an even larger proportionate increase in the income receipts of those who are engaged in buying and renting housing. So the outlook at the moment is quite serene. Various fears have been expressed in some quarters by people who fear that we are moving into a down-turn. But overall that is a question for another day. There is no reason at all for any pessimism in the housing industry. I support this measure very strongly. 1 congratulate the Minister for Housing upon the way in which he has persuaded the people involved to accept this course and has improved the basic situation for the lowest income groups. This is essentially the basic social improvement involved in this legislation which, apart from the direct grant for cheaper housing for these groups, also provides for a payment of $1.25m a year for rental assistance. Over and above all these things the new payment arrangements means that the Commonwealth will meet the 0.25 per cent sinking fund contribution and thus will very largely take over the sinking fund obligations, which would amount to $1 14m over 53 years. In practice these sums depend on what the States decide to spend on housing. An important incidental factor is that this responsibility is now placed where it squarely belongs - in the hands of the States. The States will now decide through the year and at any time that it is appropriate what they will allocate from their loan funds to housing. We have got out of the old system whereby the State Premiers used to come here once a year and used to have to nominate what proportion of their total loan funds should be allocated to housing. The Bill will give the State authorities a very much greater say and initiative in how they spend their loan funds and how they set their priorities, not just at the beginning of the year. If necessary they may switch them during the year without any formality. I oppose the amendment and I very strongly support the Minister and this Bill.







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