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Thursday, 1 April 1965

Senator BISHOP (South Australia) . - I move -

At the end of the definition of " approved security" add "and if the land is subject to a first legal mortgage to an authority of the Commonwealth or of a State, also includes a second legal mortgage.". 1 point out to the Minister for Defence (Senator Paltridge), who is in charge of the bill, that if this legislation is passed in its present form two anomalies will be created, in respect mainly of applicants and persons eligible for war service homes. Then there is an associated question which I have already spoken about and which concerns the South Australian position. It might not strictly come within the relevant category, but it ought to be examined by the Minister, having regard to the fact that his officers have been in South Australia and have discussed this matter with the Housing Trust in that State. However, this is only incidental.

The position is that persons who are eligible for war service homes finance will be prejudiced by this legislation. The ordinary member of the community would, in the words of the Minister, be able, if his credit were good enough, to have a loan insured by the Corporation of up to 95 per cent, of the capital value of the property involved. Under the war service homes legislation an ex-serviceman is limited, in the first place, to a loan of £3,500. The annual report of the War Service Homes Division gives the cost of building war service homes in various States. The cost ranges from £4,000 to more than £7,000. The average cost, or the cost upon which most of us have agreed, is about £5,000, and this figure has been mentioned by the Minister. It is obvious that applicants for war service homes costing as much as this would have to secure a second mortgage, and they would be outside the provisions of the legislation now before us.

The Returned Servicemen's League last year made representations to the Minister concerning this matter and some consideration has been given to it, but I suggest that there has been no firm reply to the effect that he matter will be dealt with in any other piece of legislation. I noticed that in the other place the Minister for Housing (Mr. Bury) spoke about this matter. He told the R.S.L. that the position was being considered, but he made it clear that the intention of the legislation was not to make the provisions that it was suggested to him were necessary. Unless the Minister is prepared to say that the anomaly will be covered by subsequent legislation flowing from consideration of the various points raised, it would appear that it is necessary to propose this amendment.

I would like the Minister to answer my question about South Australia. J raised this point at the second reading stage. The position seems to be satisfactory in relation to the insurance of the mortgage, but I hope the Minister will give us the benefit of the results of his inquiries.

Senator Paltridge - Will the honorable senator repeat his question?

Senator BISHOP - The position in relation to South Australia is this: The South Australian Housing Trust makes a loan on second mortgage to the purchaser of a home built by the Trust. This money does not come directly from Commonwealth funds. After the applicant, or the purchaser, obtains a loan on first mortgage from the State savings bank he is required to raise another loan on second mortgage from the Housing Trust. Some Commonwealth funds are used in South Australia to build rental homes. What I am concerned about - and the question has not yet been satisfactorily answered - is whether purchasers in South Australia of homes built by the Housing Trust will be eligible for the kind of insurance proposed under this legislation.

I leave the matter there. The main intention is to remove the anomaly in respect of war service homes that will result if the legislation is passed in its present form. I make the point that, on the basis of what has been said, there has been no real undertaking by the Government, either in the Senate or in another place, that the position will be covered by appropriate amendments to the War Service Homes Act. Although the R.S.L. has made representations to the Government and I know the matter is being considered, it is obvious to me from the Minister's statement in the other place that his thoughts on the question are that he should not make the suggested alterations to this legislation. If this position is not to be covered elsewhere, it is obvious that the amendment we propose is logical and ought to be agreed to by the Senate.

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