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Wednesday, 31 March 1965

Senator PALTRIDGE (Western AustraliaMinister for Defence) .- 4 indicate at once that I am unable to accept the proposed amendment. In doing so I point out that if the amendment were carried, not only would it be impossible to add to the list of approved lenders but in fact there would be no approved lenders when the Act came into operation. I shall read from that portion of the second reading speech relating to approved lenders and the procedures which are proposed. It states -

The legislation will provide that an insurable loan must be made by an approved lender. The classes of lenders eligible for approval will be specified by the Minister, but the Corporation will approve particular lenders. The Corporation will also have the power to withdraw its approval of a lender. Classes of approved lenders will include banks, life insurance companies and building societies. As times goes on other classes of lenders will almost certainly be approved.

May I point out that only last week when this Bill was being debated in another place and when this particular matter was before it per medium of a contribution to the debate by Mr. Wilson from South Australia in relation to the desirability of including trustees as approved lenders, the Minister at that point, with the Bill still in the process of passing through the Parliament, indicated that trustees were a class of lenders which he was considering.

Senator Wright - Trustee companies?

Senator PALTRIDGE - He said trustees but, as the honorable senator has interjected, it would appear to me to be not improbable that if trustees were admitted, then a$ a first step trustee companies would be included. 1 want to emphasise what I might refer to as this process of gradualness because it is important. In relation to 'the homes savings grant the Minister particularly has given every indication of his willingness to introduce amendments to the legislation as the need for them becomes obvious. I believe that this is very desirable for a government and for a Minister moving in an entirely new field. It has been commended here during the debate today.

In respect of the matter now before us, it is proposed to do precisely that - to widen the field and to broaden the scope of the legislation in the light of experience.

It has been said that to pass the legislation in its present form would give an advantage to banks, insurance companies and building societies, but I want the Committee to look at the proposal from another aspect. I want the Committee to realise that if we cannot introduce this scheme and get it going initially on the basis of banks, insurance companies and building societies, its introduction will necessarily be delayed. The simple fact of the matter is that this is not just a question of nominating as approved lenders people and organisations who appear, at first blush, to be suitable although they may, and in many cases certainly will, prove to be so. This step has been taken after an examination of the question and after discussion with people who have had experience in this field.

I am informed that all the advice we have received from overseas countries in which there are housing loan insurance schemes is that the administrative tasks of the lender - the lender is responsible for the administration of his loans - .are very much reduced if lenders are confined to persons and organisations who are experienced in administering mortgage loans along sound business lines. We believe that it is fit and proper that the Government should determine the broad classes of approved lenders.

Senator Ormonde - 'Does that happen in Canada?

Senator PALTRIDGE - I believe so, and I think it is a proper function of government to see whether classes of lender are included. Similarly I believe it is a proper function for the Corporation to say which particular individuals within that class are approved as lenders.

I put this proposition: Here we are embarking on a new field of activity, not wishing to restrict it unduly; indeed, within the ambit of practicability, wishing to push it along as fast as we can, but taking cognisance of the real difficulties that are present and trying to apply to those difficulties procedures which are proper and which will prove to be efficient. I can only end where I began. I return to the second reading speech and to what the Minister said in another place the other night when he indicated that from time to time other lenders will be authorised and will participate in the scheme. I think this is the right way to do it.

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