Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Full Day's HansardDownload Full Day's Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Tuesday, 4 December 1973
Page: 4183

Mr MARTIN (BANKS, NEW SOUTH WALES) - My question is directed to the Minister for Housing and Construction. Is the Minister aware that, despite appeals by this Government, some permanent building societies have increased their interest rates to borrowers by more than one per cent, thus increasing monthly repayments on the average loan by as much as $20 per month? Can the Minister reconcile this seemingly callous approach with the fact that the permanent building societies in New South Wales, during October, received record deposits of $102.5m, thus breaking for the first time in their history the $100m barrier? If the permanent building societies are able to attract record deposits by paying 7i per cent to depositors, why is it that some of them are ignoring the Government's appeals to reduce hardship on people making repayments of their housing loans?

Mr Les Johnson (HUGHES, NEW SOUTH WALES) - It is a fact that the Government appealed to lending authorities to shield home borrowers from the effect of the recent recommendations of the Reserve Bank. It was proposed that the increases in interest rates be contained to one per cent, and I am very pleased to acknowledge the considerable degree of co-operation that has been extended by many lending authorities in this regard. The Executive Director of the Association of Permanent Building Societies of New South Wales has informed me that only one permanent building society in New South Wales increased its interest rate by more than one per cent. It is interesting to note that the building societies in that State have been successful in breaking the $100m barrier, to which the honourable gentleman referred. The deposit rate for the month of October broke the record and reached $102m - the first time ever to exceed $100m. It seems to me that if this can be achieved in New South Wales it should be achievable in other parts of the country as well.

In New South Wales, the flow-out for the month of October was $76m and the net gain was $27m. The fact is that there are varying interest structures applying around Australia. Some building societies have tailored their interest rates to suit short-term as against long-term loans and, in all, there are some unsatisfactory symptoms emerging. I believe that this shows the need for a national policy. For far too long has the Australian Government been deprived of legislation enabling it to be effective in regard to the activities of lending institutions, including building societies, and there is little doubt that stability will become the order of the day, benefitting lenders and borrowers and everybody associated with the building industry, if we can introduce legislation which will enable us to regulate the volume and cost of money to be made available for home building purposes.

Suggest corrections