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Wednesday, 30 May 1984
Page: 2138

Senator HEARN —I address my question to the Minister representing the Minister for Housing and Construction. In Tasmania the State Government has recently informed people buying former Department of Housing and Construction homes on rental purchase that, in addition to the repayments in the agreement, an administrative fee will be charged. A number of people have held these agreements for some 30 years and consequently many are approaching retirement or are already in receipt of a retirement pension. Is this a matter within the jurisdiction of the Commonwealth-State Housing Agreement or is it solely the responsibility of the State Government?

Senator GRIMES —The Minister for Housing and Construction has informed me that under the current Commonwealth-State Housing Agreement it is a State government responsibility to determine the terms and conditions of home purchase assistance loans, subject to fairly broad guidelines in that Agreement. The charging of an administration fee on loans is consistent with these guidelines. I understand that the cases referred to are purchase contract arrangements entered into under the Tasmanian Homes Act 1950. Under the arrangements, purchasers agreed to buy Federal and State funded rental dwellings at concessional rates. Purchasers also agreed to meet certain charges, including insurance, rates and land taxes.

The Tasmanian Department of Housing and Construction administers these charges and the Tasmanian Parliament recently amended the Homes Act 1950 to include a charge of $156 per year on purchase contracts to cover the administrative costs of the Department of Housing and Construction. The interest rates charged by private housing finance institutions include a loading for administration. Administration fees are also often charged when loans are taken out. Purchase contract arrangements ceased in Tasmania in August 1976. However, interest rates charged by Tasmania and other States for home purchase loans under the current Commonwealth-State Housing Agreement include a loading for administration costs. So the responsibility is that of the State Government. The imposition of this charge resulted from an amendment to the legislation which was made recently in the Tasmanian Parliament and is outside the gamut of the Federal Minister and the Federal Department.