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Thursday, 21 August 1980
Page: 589

Mr HOWE (BATMAN, VICTORIA) - I refer the Treasurer to the following statement in his Budget Speech:

The Government again desires a high priority for housing finance to be maintained consistent with overall monetary policy.

In view of the recognition in Budget Statement No. 2 that 'saving bank deposits slowed in 1 979-80' and that there was 'a marked decline in the growth of trading bank housing loans' resulting in a more significant use of finance services outside the major mortgage lenders, does the

Treasurer's statement imply that some finance institutions will be directed to set aside a fixed proportion of funds for housing loans?

Mr HOWARD - The statement in the Budget Speech is an expression of the broad priority of the Government. I remind the honourable member that the level of lending for housing by the major institutions, that is the savings banks and building societies, during 1979-80 was at record levels. I am aware, as is the honourable member, that the capacity of savings banks to lend money for housing is related, as it is with any other lending institution, to deposit inflows. I also remind the honourable gentleman that the provision of housing funds by the permanent building societies has been growing at a very steady rate. I can only repeat what was in the Budget Speech, namely, that this Government retains and will continue to retain a very high priority for housing lending. I believe the changes that have taken place over the past few years so far as ratios are concerned have enabled a large provision for housing and that will remain a significant priority. The situation must always be governed by overall monetary policy considerations and must always be fully consistent with the commercial judgment of the individual lending institutions concerned.

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