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Housing finance decline continues to pressure small business

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JUDIMOYLAN MP Shadow Minister for Small Business & Shadow Minister Assisting the Leader on Women's Affairs Member for Pearce MEDIA RELEASE



The housing sector has suffered a further decline in activity, with a seasonally adjusted 3.1 per cent fall in the number o f dwellings financed during March. This compounds the seasonally adjusted 32.1 per cent decline for the 12 months to M arch 1995.

"The current depressed nature o f the broad housing market, Australia-wide, is affecting thousands o f small businesses, placing their future in jeopardy," said M rs Judi Moylan MP, Shadow Minister for Small Business.

"Employment, investment, profitability and future viability o f the residential construction industry is seriously under threat. This mocks the Keating Government's decision to impose a N EW 12 per cent sales tax on builders' hardware which was announced in the 1995/96 Budget.

"The number o f dwellings financed has been falling since February 1994. The level o f finance committed, on a monthly basis, is now $1.26 billion per month lower than April last year.

"Few industry sectors have the ability to survive this sort o f market decline, without serious consequences for the long-term structure and viability o f the sector.

"The difficulties being experienced by the housing sector highlight damaging consequences o f the boom bust economic management o f the Labor Government.

"It is a sad indictment o f the Government's total reliance on monetary policy, as well as the policy paralysis that has overcome the Keating Government, that small businesses in the building industry are the first to suffer the consequences.

"The absurdity o f imposing a N EW 12 per cent sale tax regime on builders' hardware, at a time when the industry is reeling from a decline precipitated by increases in interest rates has astounded industry participants. The price o f a new family home, renovations and extensions will all rise as o f 1 July 1995.

"It clearly demonstrates that Keating, Howe and Schacht have absolutely no idea o f the pressures being exerted on the small business sector and the housing industry in particular.

"The Government's Budget decisions will simply add to the hardship and doubt being experienced in the housing industry."

19 May, 1995 CA NBERRA C O N T A C T

06 277 4928

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