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Wednesday, 4 December 1912

Senator ALBERT GOULD (NEW SOUTH WALES) - The land tax isonly imposed on freeholds. In New Zealand the lessees became so numerous that at last they petitioned Parliament to grant them the right to convert their holdings to freeholds, and possibly we shall have a similar experience in connexion with the Northern Territory. I desire to draw attention to the following provisions in clause 22 - (1.) Where any land leased under pastoral or agricultural lease in pursuance of this Ordinance has been mortgaged, and the mortgagee enters into possession thereof, he may remain in possession (subject to the term of the lease) for a period of three years from the date of entering into possession, and for such further period as the Administrator thinks fit to permit. (4.) If a mortgagee fails to assign or transfer the lease within three years after entering into possession of the land, or within such further period as the Administrator permits, the Administrator may by notice in the Gazette forfeit the lease.

Is it at all probable that any financial institution will care to have much to do with such a security? Is it fair to the leaseholders to say that they must have an inferior security to that of other persons ? I maintain that the provision that a mortgagee must be able to sell in less than three years will be a tremendous handicap to the borrower. Not only that, but the rates of interest which he will have to pay will be a serious handicap. Financial institutions, of course, prefer freeholds to leaseholds. From personal experience, I know that many a man shuts up his pocket at once when he discovers that it is leasehold security which is offered. I hope that the term of the lease will be extended considerably. I recognise that it may be extended by the Administrator, but we shall be at the mercy of one person. We do not know whether he will be a man of intelligence or not. According to what some honorable senators have said here, the Director of Lands was a defeated Labour candidate at one time.

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