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Thursday, 21 May 1970

Mr UREN (Reid) - The Opposition accepts the request for the amendment made by the Senate. I would like to give a brief outline of the history of this legislation. It was first introduced into this House on 5th March 1970, being part of an election promise. It was designed to increase from$1 5,000 to $17,500 the value of a home, including the value of the land, on which a loan may be made. Homes were becoming so expensive that the Government had to raise the maximum amount which would attract a loan to enable people to get any benefit from it. That is the only real value crf this legislation. As a smoke screen the Government set out in clause 5 certain proposals under which credit unions may become eligible to seek loans under the homes savings grant scheme. No negotiations were held with the credit union authorities, there was no discussion with the respective State governments, and there was no discussion between the Department of Housing and the Department of the Interior which controls credit unions in the Australian Capital Territory. Canberra has more public servants and a greater percentage of people who are members of credit unions than any other sector of Australia. The relevant ordinance for the ACT provides that no loan can bc made in excess of $2,000. Yet here we have an amendment that will reduce from $7,000 to $5,000 the minimum amount for a prescribed housing loan. I hope that the people who live in the Australian Capital Territory see the hypocrisy tff the Government in this regard. To put the legislation into perspective so that the Department of Housing would have sufficient time to discuss it with the State governments and other departments, the Opposition moved as an amendment to the motion for the second reading of the Bill that the clause relating to credit unions should be redrafted to give credit union savings complete and unconditional recognition under the Act. That motion was defeated because the Government had the numbers. We explained that section 7 (d) of the New South Wales legislation covering credit unions permitted a maximum loan of $4,000. At that time this Government's proposal was for a minimum amount of $7,000. Now it is to be reduced to $5,000.

Seventy per cent of the members of credit unions live in New South Wales. Even so that 70% are not brought under this clause of the Bill. Since the legislation was introduced in this House the New South Wales Minister who deals with credit unions has stated clearly and publicly that he will not increase credit union loans beyond $4,000 No further statement has been made to clarify that position. This provision for a minimum loan of $5,000 will prevent members of the credit unions from being included. As I said, 70% of the members of credit unions live in New South Wales. Some 307 credit unions exist in New South Wales, 234 of which have assets of less than $150,000. If honourable members look at clause 5 of the Bill they will see that the minimum amount in subsequent years that the credit unions must lend is $50,000. We tried to explain to honourable members opposite that the credit unions were not really geared for long term loans or to be forced into repaying them over a period of 12 years.

In another place my Party moved that the minimum amount for a prescribed housing loan be reduced from $7,000 to $3,000 and that the repayment period be reduced from 12 years to 5 years, lt also proposed that the total amount required to be lent by credit unions to their members during the financial year be reduced from $50,000. The vote was 25 to 25, which nullified the proposition. If the Government had accepted our proposition it would have enabled many credit unions to be brought under this clause of the Bill. But it was refused. This legislation is a face saving device. The Government says that it is going to reduce the minimum amount of loan from $7,000 to $5,000. This still will not bring in the 70% of credit unions in New South Wales, unless there is an amendment to the New South Wales Act. I refer to page 1285 of Hansard of 16th April 1970. There set out are the assets of the credit unions of New South Wales. Of the 307 credit unions 234 have $150,000 or less in assets.

The credit unions are not competing against the banks, which the Government is interested in protecting. It has practically forced people to go to a bank to become entitled to the special grant. People are not interested in that. These credit unions are in competition with the hire purchase companies. I gave as an example in the ear er debate 3 of the major hire purchase companies which are involved in providing loans for housing, land for housing, or alterations to homes. The Bank of New South Wales holds 42.8% equity in one of those hire purchase firms. The Bank of Scotland owns 30% of another of those hire purchase firms. The third of the firms that I mentioned is owned wholly by the Bank of Adelaide.

The request which has been returned by the Senate with the Homes Savings Grant Bill is not fooling anybody. It is not fooling those members of credit unions in Canberra who would like to participate in this homes savings grant scheme. These credit unions cannot become involved in this scheme. Its members cannot benefit under it. This is because, under an ordinance, the Government has said that $2,000 is the maximum amount that may be provided as a secured loan for housing purposes by credit unions in the Australian Capital Territory. In fact, the amount available for such purposes on an unsecured loan is $800 only. So, I hope that in particular members of the credit union organisations study the hypocrisy of the Government after the long and patient negotiations that the credit un on movement has undertaken with the Government, the Prime Minister (Mr Gorton), the Minister for Housing (Senator Dame Annabelle Rankin) and officials of the Department of Housing.

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