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Wednesday, 20 September 1972
Page: 1658

Mr SCHOLES (Corio) - It ill behoves the honourable member for Cook (Mr Dobie) to start his speech with a totally untrue statement. He said that the Labor Party was not putting up speakers on this Bill. My examination of the speakers' list revealed that there are 6 Labor Party speakers and 6 Government speakers listed. That does not seem to me to be any great imbalance. I would also point out that it is becoming increasingly difficult for members of the Opposition to deliver speeches when they are below third or fourth on the list to speak to a Bill because the Government takes the attitude consistently that if it has not any speakers on a measure it will gag the debate. Last night, on one of the most important matters to come before this Parliament, only 2 speakers from this side of the House were allowed to speak. Applying the criterion of the honourable member, the Government had no interest whatever in grants to the States, how they were used or whether they were adequate, because the Government did not have speakers on the States Grants Bill. I think it is a fallacious argument which has no relevance whatsoever to the merits of a measure.

This Bill provides for an adjustment of the valuation of houses which qualify, to meet the changing circumstances in the cost of housing, lt does not, in fact, increase the real value of houses which qualify; it merely adjusts the qualifying amount to meet an inflationary situation in certain areas of the Commonwealth. It may well be a better proposition from the Government's point of view and from an administrative point of view to leave out the value of land involved in the calculation. I think it would be easier on a national scale to have the value of the home itself specified in the Bill, because this sort of valuation is not difficult to get, rather than the value of a home and land because of the verywide variations which exist. There are very wide variations in the cost of homes throughout Australia. The increase in the grant from $500 to $750 hardly meets the increase in the cost of purchase of homes in some areas since the inception of the $500 grant in 1954. However, I would like to speak mainly about the difficulties which some people have in obtaining loans. The great bulk of people who save can obtain their loans without any great difficulty but there are large numbers of marginal cases. There appears to be no way in which discretion can be exercised to cover these people. The inclusion in this Bill of provisions related to credit unions will increase the number of marginal cases. What happens to a person who in good faith saves with a credit union only to find when he applies for a loan that the credit union is not then or was not for some period qualified under the terms of the Bill? This could quite easily happen and almost certainly will happen. Is the individual in that case to be punished because of the failure, as it may well be, of the credit union.

The Minister for Housing (Mr Kevin Cairns) has before him at the present moment a case referred by me of a new Australian gentleman who, on advice from his solicitor, signed a contract on a certain date only to find that that date was not the appropriate one. It was the anniversary of his arrival in Australia, not the anniversary of the opening of his savings account. The 2 were 10 days apart, but because of those 10 days he did not have 3 years savings and was disqualified under the Act. I had another case not so long ago of a man who was anxious to get started with his house and poured the concrete for the foundations of his house a week before the 3-year saving period was up. Because he commenced the construction of his house prior to the expiration of 3 years he also did not qualify as he did not have 3 years savings. There was a not dissimilar case of a gentleman who built a room purporting to be part of a house. He subsequently had to pull the room down and submit new plans to the local government authority and start building completely from scratch again. Yet he was held to have started construction of his house with the original room and therefore did not qualify.

From a reading of the handbook some pretty complex regulations appear which could be confusing to people not well versed in these matters. On too many occasions I feel this could lead to people not being granted loans. I would like to see a greater discretion provided in the granting of loans to persons who through no fault of their own are excluded from receiving money upon which they are relying. Quite often it is an amount of money around which they have planned the finances for their home. The $750 grant would be of more assistance if the conditions applying today were not quite so rigid.

I do not agree with the honourable member for Cook that this scheme has changed the whole savings pattern in Australia. People who want a home have to save and will save. The fact that the Government is now dictating the manner in which they will save is not necessarily either a good or bad thing. People who are able to save quite often, in order to qualify for the homes savings grant, will have to save in a way which may not fit their individual circumstances. They must save at a relatively uniform rate, and this is not always possible. If in one year their savings fall behind they lose a portion of their grant. It is possible, especially in the case of a young couple, that in the second year of this savings period the wife will have a child and not be able to work. Because the savings in that year naturally will be lower that couple will be denied a portion of the grant through no fault of their own. They may well save the amount required in the 3-year period but because the wife was not able to go to work for a considerable period in one year the amount of the grant will be reduced. In other words, that family will be fined because the wife had a baby.

There are other circumstances in which this would also apply; for example, the illness of the husband or a temporary period of unemployment of the 'husband1 - and some of those periods of unemployment are becoming more and more extensive. This sort of unfortunate occurrence can reduce the amount of the grant made to a couple because the savings in that year did not meet the requirements. I realise that the margin has been increased in this Bill so that couples can save up to $900 in one year, but this still does not alter the fact that the present scheme is restrictive because it compels people to save in a special way. There should be a far greater flexibility, especially in the fringe areas, in cases where a person misses out on qualifying by a few days, quite often through no fault of his own. As I mentioned earlier, in one case a man was advised by his solicitor, who was obviously quite wrong, that he could sign the contract on a certain day. If one cannot take the advice of one's solicitor one should not be paying him, I suppose. But wrong advice is sometimes given and it was unfortunate that it was given in this case because it cost this man $500. There are numerous cases of people who for various reasons have missed out.

If the value of this grant is to remain constant - and it has been deteriorating pretty rapidly over recent years - the grant must in some way be equated to the actual cost of housing. At the moment it is an amount of money which I would suggest was worth much less to young persons last year than it was in 1964. Another matter which irks a lot of people is that there are provisions in the Bill under which a home which was built by, for example, a State housing commission does not qualify for a loan. Consider the case of a home being bought by a couple from the original purchasers. Whilst the house may well have been built at a cheap rate and sold to the original purchaser at a low price because of Government assistance in its construction - and there is some doubt now whether such houses are cheaper than comparable privately built houses on resale - when the second purchaser purchases the house from the original purchaser there is no reduction in the price. The house is sold at its market price. Yet in such cases the second purchaser is not eligible for a homes savings grant in respect of that house because it is assumed that the price paid by the original purchaser was lower than would have been paid had the house not been built under the Commonwealth and State Housing Agreement. This reacts against individuals in a manner which should not be allowed to continue. I would ask the Minister to give this matter consideration. That provision has been in the Act ever since its inception. I can assure the Minister that a person selling a housing commission home will not take $750 off the price because it was built with Government assistance. The owner gets what he can for it and that is the most natural attitude in the world for him to take.

One other point I wish to raise is the very serious situation which is developing with relation to the cost of housing and the interest charged on housing finance. The amount of $750 provided in this Bill would not meet the increase of 1 per cent in the interest rate which has occurred since the inception of the Bill. When we look at the manner in which these amounts have moved in recent years we see that valuations have gone up so that now the maximum price of a home to qualify for a grant has been increased to $22,500. The relativity between the cost of housing and the level of the grant has completely altered since the inception of this legislation. I do not want to say any more at this stage but I would suggest that if this type of assistance to people is to be continued it should be based not merely on an amount of money plucked out of the air and adjusted some time or never but on the objective of ensuring that the maximum possible number of people get the grant, and that the grant has some relation to the actual cost of housing.

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