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Friday, 6 August 1926

Senator ELLIOTT (Victoria) . - I support the motion, a course: to which I have been driven by the contemptuous manner in which the Government has replied to questions which I have asked regarding land at Canberra. We are rapidly approaching a condition in this Chamber in which honorable senators are unable to influence the Government in any direction.

Senator Ogden - The departmental heads are the bosses.

Senator ELLIOTT - That is so, particularly with commissions. When I was at Canberra I told one high official that the system under which land at Canberra was made available would have to be referred to in Parliament. His reply was, " What has Parliament to do withit?" That is the way in which we are being treated.

Senator Ogden - That has been the position for years.

Senator ELLIOTT - Recently I asked the following question -

Is it a fact that, although there arehun dreds of acres unoccupied in the Federal Capital site, the commission will not at the present time sell a business site in or near the civic centre to a bona fide applicant? and received the reply -

Forty-six business sites near the civic centre have already been made available by theFederal Capital Commission. The commission considers that these, in addition to the business sites in other subdivisions, adequately meet the present business requirements of the Capital. The commission proposes to submit additional business sites for sale at an early date- It is considered that the sale of isolated business sites would be inadvisable from an Architectural point of view.

Senator Grant - To make more sites available would interfere with the premiums.

Senator ELLIOTT - Quite so. The information supplied by the Minister was known to me two weeks previously. When I called at the office of the commission to inquire for land, I was informed that none was available. I then called on Messrs Woodgers & Calthorpe, the Government's auctioneers, and inspected two plans of subdivisions. Those plans showed the whole of the lands which were made available at the first and second subdivisions.

Senator Pearce - Is the honorable senator referring to the business area?

Senator ELLIOTT - Yes, but I believe that the same conditions obtain in respect of areas set aside for residential purposes. The only land which was available in the Blandfordia No. 5 subdivision was block No. 13, which is more suitable for a quarry than for a residence: in fact, I informed the Commission that the only thing a purchaser of that block could do would be to hand it back to the commission to be used as a quarry to obtain stone for paving the roads. I was informed that if I were content to wait until the public servants had made their choice of the blocks, I could then select any of the blocks remaining. But at the time of my visit the only block which was available in that subdivision was one with a large outcrop of granite. Nothing would grow on it in 100 years.

Senator McLachlan - It could, at least, be said that a house built on ft would be founded on a rock.

Senator ELLIOTT - I invite the attention of honorable senators to the upset prices fixed for these blocks. Business sites with a frontage of 20 feet have an upset price of £400 each. In estimating the returns which they may expect from land subdivision, land salesmen consider that in each acre of land, after allowing for streets, &c, 200 feet of frontage would be available for sale. By multiplying 200 by the price per foot which they expect to realize, they are able to make an approximate calculation as to the result of the subdivision. That rule applies to blocks with a depth of 150 feet ; these blocks have a depth of only 88 feet. Moreover, their frontage is 20 feet, as against, say, 50 feet in ordinary subdivisions. The upset price of £400 for a block with a 20-ft. frontage is £20 per foot. I emphasize that that is the price asked for a block 88 feet deep. I understand that the Federal Capital Territory was acquired for about £4 an acre; the Government is endeavouring to dispose of it for £4,000 an acre.

Senator Ogden - It is too much altogether.

Senator ELLIOTT - It cannot be obtained for less ; that is the upset price. Certain business institutions, whether they like it or not, are compelled to build at Canberra, and to pay at the rate of £4,000 an acre for the. land.

Senator Cox - That should assist to make Canberra a paying proposition.

Senator ELLIOTT - If land remains at that price, Canberra will not make much progress. At the original sale very few blocks realized more than the upset price. In the case of blocks 7 and 8, however, a price far exceeding the upset was realized. . A wealthy squatter determined to buy those blocks, and to erect a building on them, so that his name would be associated with the foundation of the Federal Capital city; but a representative of an insurance company, desirous of obtaining the same blocks, also attended the sale, with the result that land, the upset price of which was £875, realized £2,055 at auction. The remaining blocks at the other end of the subdivision brought only the upset price. I ask honorable senators to realize that the Civic Centre at Canberra will, in time, be comparable with " The Block " in Collins-street. At the second sale of Canberra leases an extraordinary thing happened. On the original plan a magnificent site was reserved for the Commonwealth Bank premises. As, however, that site called for a building costing between £500,000 and £1,000,000, which would not be justified for 100 years, the Commonwealth Bank was forced to attend the auction sale to obtain another site. There was spirited bidding for a good corner site. Eventually it was knocked down to the Commonwealth Bank for £7,000. After the sale, the runner-up informed the bank's representative that, had he known that his competitor was the Commonwealth Bank, he would not have competed for the block, but would have allowed the bank to obtain it at the upset price. Honorable senators should realize the difficulties which arise in consequence of values being fixed in that way, as the land in the neighbourhood will be valued, and the rates assessed on that basis.

Senator Cox - It was sold at public auction.

Senator ELLIOTT - It would be satisfactory to the Government if it was in the same line of business as Mr. De Garis, but the commission's policy is not in the interest of the future development of the capital. Those who purchase building sites at such exorbitant prices have to earn interest on the capital expenditure, which will eventually be added to the cost of the goods they sell. I am thinking more of the unfortunate individual who has to endeavour to make a living on these building sites, and not of persons such as Senator Cox, who will perhaps remain in the Territory for a little while, and then slip off to Sydney. If Senator Cox is unfortunate enough to reside there, he will have to contribute indirectly towards the interest on the capital expenditure, because it is only reasonable to assume that business men will have to sell their goods at a price sufficiently high to meet their expenditure. The rent on a building lease costing, say, £7,000, must, of course, be distributed over the commodities .which are sold in the building erected. Generally speaking, the prices in Canberra will be so high that the main shopping centre will be at Queanbeyan, where business people can erect a tin shanty at a very low cost, transport their goods by motor trucks over an excellent road to Canberra, and unfairly compete with these unfortunate people, who have to submit to such conditions. Business people in Canberra will be asking the Government to erect a great wall around the Territory in order to keep the Queanbeyan business people from entering into competition with them.

Senator Guthrie - Are there any hotels in Queanbeyan for sale?

Senator ELLIOTT - There are not any for sale, and I understand that the erection of others is contemplated. At the first sale at Canberra. 28 blocks were sold, and at a subsequent auction about one-half of that number, the remainder being reserved in order to force up prices still higher. If the Government or the Commission intends to boom land values, the policy is a good one, but it is detrimental to the inerests of Canberra.

Senator Ogden - It is waiting for the unearned increment.

Senator ELLIOTT - Under the regulations, lessees are supposed to build within a specified time, but apparently there are some who are looking for a tremendous rise in prices. If future values are to be determined by the price at which the Commonwealth Bank acquired its site, prices will be too high for business men. Apparently the Commission has adopted a policy under which it will be possible to obtain, in a few years, sufficient revenue to meet the whole of the capital expenditure on the Federal capital, but such a policy can be carried to extremes.

Senator Granthas suggested a remedy by re-appraising the land each year. I may purchase a block at £1,200, just as the Commonwealth Bank was compelled to pay £7,000. Am I to be re-assessed at that price? Such a method would be impossible.

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