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Tuesday, 23 February 1971

Senator Dame ANNABELLE RANKIN (Queensland) (Minister for Housing) (5.04)- I have carefully listened to Senator Poyser because I know he is interested in these matters. But I was a little amazed because he really did not seem to be speaking to the motion. He talked about interest rates, municipal rates, high rise buildings and social amenities, but none of these things is mentioned in the motion.

Another interesting point is that this motion has been on the notice paper since last August. Senator Murphy implied that it was of great importance when he moved the motion, but today his seat is vacant when we are debating it and another senator has led for the Opposition in the debate. Surely this shows that Senator Murphy is treating the matter as trivial. If he had been sincere in moving this motion, surely he would have been here to open the discussion on it.

Senator Little - He does not want to leave his seat vacant. The Australian Democratic Labor Party will snap it up.

Senator Dame ANNABELLE RANKIN - Having listened to the interjection of my friend may I also comment that if this is how Senator Murphy shows his concern for the motion which he has moved and brought into this House then 1 wonder how much attention honourable senators opposite would give to no inquiry into these matters.

Senator Douglas McClelland (NEW SOUTH WALES) - The Minister will hear more on this subject when a Minister who has introduced a Bill is not here to lead for the Government in the debate. We will use the same argument.

Senator Dame ANNABELLE RANKIN - I do not think that has anything to do with the subject at all. Senator Murphy moved this motion. I thought that up to this time he was treating it most seriously and that he was personally concerned with it.

Senator Sim - Honourable senators opposite are touchy about it.

Senator Dame ANNABELLE RANKIN - Yes, I noticed that. I have looked at this motion on the notice paper and given a good deal of attention to it. For good reasons which I shall enumerate to honourable senators the Government opposes Senator Murphy's motion. One reason is that the proposed scope of the inquiry is much too wide. It would take ages to produce a report on all the items which are contained in this motion. If there is to be an inquiry into housing problems - and we do not think that this is necessary - I believe it should be into specific housing problems where the matter could be the subject of a quick report. A committee could meet, discuss the matter, obtain information and report back to the Senate.

Another interesting point is that for all these months we have had this matter before the Senate Standing Committee on Health and Welfare. This time we are asked to refer it to a committee which is noi yet in operation, lt has not yet been set up. We do nol know when it will be set up. To me this seems to be extraordinary.

In listening to Senator Poyser I have not heard one argument which I feel would convince any thinking Australian that the appointment of an inquiry such as proposed would provide an additional home for a needy family. To suggest that the Government is not continuing to explore the housing needs of Australians and is not considering desirable further action to satisfy as many as possible of these needs is sheer nonsense. A reasonable supply of private finance has been made available for home building and purchase. In 1970 the value of housing loans approved to individuals by savings and trading banks and major assurance companies was a record $773m. In addition the permanent building societies approved housing loans amounting to $339m, a total of $1,1 12m. As all hon~ ourable senators will be aware we recently increased from 35 per cent to 40 per cent the proportion of depositors' balances with savings banks which may be lent for home ownership and other socially beneficial purposes. Large and increasing Commonwealth advances are being made each year through the Home Builders' Accounts to co-operative housing societies to assist home seekers on modest incomes to acquire their own homes.

The Commonwealth is also providing large sums for aged persons homes. We are also offering long term housing loans at a very favourable rate of interest to eligible ex-servicemen. In addition we are providing generous assistance to their widows. We are making sizeable advances to the States at a concessional rate of interest to permit them to house needy families at rents which these families can afford to pay. This is being done under the CommonwealthState Housing Agreement to which the honourable senator referred. The home building industry does not lack the capacity to build the number of new dwellings needed, nor is there any significant under-employment of the industry's resources. Lenders are being encouraged to make, and are making, high ratio housing loans to home seekers at what are, under today's conditions, reasonable rates of interest. This is being done by the offer to insure repayment of principal and payment of interest, both by the Housing Loans Insurance Corporation we have set up for this purpose and also by private insurers. Most important, is there any significant number of our citizens lacking shelter? There is not a considerable number, but we are very concerned about those who are living in inadequate accommodation or paying too large a proportion of their incomes as rent. These are matters which concern us.

As I have mentioned the Government is maintaining an economic climate favourable to an increasing flow of private finance for home building and purchase, lt is offering financial assistance lo home seekers in a variety of ways. Our several efforts in the housing field have raised the standards of housing and dwelling accommodation for many Australians - I think this is an important point - and we are continuing our efforts to provide more accommodation for those most in need of satisfactory homes. We have a great record in regard to housing in this country. Most people in Australia are better housed than those in any other country. But we still need more suitable accommodation for some aged and disabled persons, some families without a male breadwinner and some large families on relatively low incomes. These persons and families need housing at rents or prices they can afford to pay. The Government is continuing to direct its attention to these problems which are indeed important. But I ask honourable senators to note that housing for the needy is not among the matters specifically listed for referral to the Standing Committee. The Government is concerned with the practical things that need to be done to improve the housing situation of a number of Australians and not with just theoretical exercises.

A satisfactory number of homes is being commenced to meet the housing needs of the growing number of young married people, migrant families and single persons wishing to establish a home of their own. During 1970 some 143.000 new homes were completed. 1 ask honourable senators opposite a question: Does the Opposition really believe that an inquiry into housing, especially one with the terms of reference proposed in this motion, would produce practical proposals not already being considered by the Government to improve the lot of those in need of better housing? Would the proposed inquiry be likely to be concerned with the real housing problems which the Government is tackling? 1 would say that up to this point we have not been given a scrap of evidence by the previous speaker to suggest this. 1 invite honourable senators to look carefully at what the Standing Committee would be asked to inquire into. It would bc asked to find out what would be future housing demands - not needs but demands - and whether the home building industry is capable of meeting these demands which no-one can accurately forecast some years ahead, lt would bc asked to report on the extent to which private capital can be expected to finance future demands for housing; a question to which no reasonably precise answer could possibly be given. It would be asked to examine the allocation of Commonwealth finance for different types of housing need and for urban renewal projects - for what purpose is far from clear, unless of course the Opposition wishes to allocate less Commonwealth money for housing the needy and to indicate to the States that in their fields of town planning and the provision of urban services they must comply with standards laid down by the Commonwealth in respect of these operations as ari essential precondition to determination of the extent of any new offer to the States of Commonwealth housing assistance. The final matter which would be inquired into - which was added only last Thursday, ] would remind honourable senators - relates to land costs.

I fail to see how the proposed inquiry would assist people to obtain better housing. The motion smacks of time wasting political opportunism by the Opposition. Let us look at the proposed matters which . are to be inquired into one by one. The first matter on the list is forecasts of housing demand in Australia. Forecasts, in this field, must be guesses because any forecast of the number of dwellings that may be demanded in future years must be based on a number of assumptions. I doubt whether any two forecasters would agree on all the inescapable assumptions. Probably the most significant factor affecting future demand is the estimated growth in population and in family formation. This must be based on guesses as to future birth and marriage rates and the future level of net migration. Allowances must also be made for improvements in standards, including the increasing tendency for single people to establish their own homes, for obsolescence and demolitions, for the growing tendency of many to own a holiday home, for the movement of people within Australia and for changes in the number of unoccupied dwellings.

Any forecast of the housing that will be demanded must also take into account changes in the economic climate, which have significant effects on the availability of housing finance, and on the movements in costs, prices and real incomes. All these are factors which will significantly affect the demand for new or better homes. How do we assess their influence in 2, 3 or more years time, or even in 12 months time? 1 should think that most Australians would agree that it is impracticable to guess the nature of the housing demands some Years hence and the areas or regions in which the homes will be required. The most rapidly expanding regions in 5 or 10 years time will be determined by a multitude of private decisions which will be influenced by many factors yet to be formulated. Those are things which I think honourable senators must consider. We will continue to study housing needs throughout the Commonwealth and the extent to which the homebuilding industry is meeting and is likely to meet these needs in the years immediately ahead. If and when We think it necessary we will use our influence to adjust the likely availability of private finance for housing and possibly the flow of finance from Commonwealth sources. But it has yet to be revealed how the preparation of forecasts of housing demand in Australia will add to the number of homes that will be built.

The next proposed matter for inquiry, as we look at the list, is the capacity of the building industry to meet future demands for housing, however uncertain the size of these demands may be. The history of the home building industry in Australia, 99 per cent of which is in the hands of private industry, has been one of continued expansion to meet all reasonable calls on it. In recent years there has been a steady growth in capacity to build the homes demanded. The industry has become more efficient in the sense that now fewer workers than were needed a few years ago are needed to produce the same number of homes. At present there is an adequate supply of all key building materials. I am quite unaware of any residential building that has been held back due to a shortage or lack of building labour, lt is true that there is little unemployment in the building industry, but this is the situation at which we aim. However, the fact that the home building industry is very close to full employment does not mean that it cannot expand as the requirement for its services grows in future. During the past decade the number of dwellings commenced increased, on average, by more than 5 per cent per annum, whilst population increased by about 2 per cent per annum. The number of dwellings commenced rose from fewer than 100,000 in I960 to close to 139,000 in 1970. This expansion in capacity has been the outcome of the many private initiatives.

The next suggested inquiry is into the extent to which private capital can be expected to finance the future demand for housing. In proposing this matter for inquiry, I can assume only that the Opposition is hoping to produce statements that insufficient private capital will be available to finance a high proportion of future home building. This is unlikely to be the case while this Government is in power. As I mentioned earlier, housing loans approved by savings banks, trading banks and major assurance companies were no less than S773m in 1970. Lending for new housing by permanent building societies is also running at a very satisfactory level. Under the stimulus of housing loans insurance, these societies are now attracting a rapidly expanding volume of funds. Over the past 12 months the major lending institutions have increased substantially the volume of their lending for the purchase of previously occupied homes. This has done a great deal to assist home seekers in satisfying their needs and requirements. Encouraged by the favourable climate for investment, brought about by the policies of this Government, more and more inves tors are being attracted to put money into new flats and so increase the amount of residential accommodation available to rent or to purchase. Private capital can be expected to finance future housing demands to an increasing extent, and with increasing effectiveness, as the idea of the high ratio insured loan takes hold.

Private capital will not provide all the finance for housing. A number of home seekers cannot afford to pay the rents asked for private dwellings or are unable to buy a modest home without some government assistance. Governments must expect to continue to provide homes for the neediest among our people - some of the aged and those families which cannot afford to purchase a home or to pay market rentals for reasonable accommodation. The prospects of an increasing flow of private capital to meet the future growth in housing demand are excellent. In proposing this matter for inquiry, honourable senators opposite appear to have overlooked the fact that this Government has been successful in influencing the flow of private investment into housing. Of course, one could not be sure that this would continue if the Opposition became the government. We should never forget that private investment is very sensitive to 'the political climate and under this Government the climate has been very favourable indeed.

The Opposition then called for an examination of the role of Commonwealth finance in housing. The role of the Commonwealth in this field is to help those needing Government assistance- to .obtain a suitable dwelling at a price that they can afford. I think that is very important. The first essential is, of course, to. determine which groups are most in need, of this assistance. From our own investigations' and our consultations with the States we have learned a great deal about who comprise these groups and what their, needs are. We have also had the benefit of information obtained from private surveys and advice on this subject by a variety of. welfare and charitable organisations. More ; recently my Department, in collaboration with the States, commenced an investigation into the housing needs of Aboriginals..,! should think that there would be a wide measure of agreement in this chamber in particular and amongst Australians in general as to who are in need of housing assistance and what it is they need. For that reason there is no need for the proposed inquiry.

Commonwealth financial assistance for housing is largely directed towards assisting the less fortunate groups in our community. It is comprehensive and comes in a variety of forms. The most significant form of assistance is that provided under the Commonwealth and State Housing Agreement, which was referred to by Senator Poyser. The record sum of Si 42.5m will be advanced this year to the States under this Agreement. Close to $94m of this amount will be made available to the State housing authorities. This will benefit those who need to rent a dwelling but cannot afford to pay market rents and those who can afford to buy a home only with the assistance of a very long term loan at a concessional rate of interest. The remaining $49m is the estimated amount to be paid into Home Builders' Accounts which, together with the addition of some $22m which will be made available from the repayment of earlier loans, is being advanced to co-operative terminating societies and other approved institutions. These advances will provide long term housing loans at a concessional rate of interest to low income families who wish to buy or build a home of their own choice.

Then there is, of course, the war service homes scheme. At least $60m will be advanced under this scheme to exservicemen and ex-servicewomen during the current financial year. Some S20m has also been budgeted for this year to provide generous capital grants for the housing of our elderly and incapacitated citizens under the aged persons home scheme and the sheltered employment assistance scheme as well as dwellings for needy single aged pensioners. We are also providing more transitory accommodation for migrant families in hostels and, for a limited stay of no more than 6 months, self contained flats. We are continuing to help young people to save for their own homes by giving them a tax free gift - the home savings grant. It has been estimated that tax free payments of about $15m will be made this year to young married couples and widowed and divorced persons with dependent children who have saved in an acceptable form for the acquisition of their homes. The Commonwealth's overall con tribution to housing has risen from Si 64m in 1960-61 to an estimated $288m in 1970- 71. With this help Australians are being better housed with each passing year.

The next matter which has been proposed for investigation is the allocation of the Commonwealth finance between housing for private owners, rental housing, housing renovation and urban renewal projects. Whilst it is our policy to encourage and assist as many Australians as possible to own their own homes, we recognise that many families and individuals require rental accommodation at some stage of their lives. Our policy is to ensure that sufficient and adequate homes become available for those on the lower incomes and to offer them the choice of buying their own homes, if they can afford to do so with some Government assistance, or to rent a home. Given this choice, there is surely no problem in allocating funds between home ownership and home rental - or would the Opposition deny a family on a relatively low income the opportunity to own its own home, as it did under the 1945 agreement?

The Commonwealth Government does not ordinarily make advances to private owners to carry out alterations, additions or renovations to their homes. This is a matter for private initiative and private borrowing, lt does, however, encourage and assist private owners to carry out alterations and additions by its offer to insure the repayment of second mortgage loans for these purposes. As for urban renewal projects, these may or may not include the acquisition and demolition of existing homes or the provision of new residential accommodation. Urban renewal can be a vast exercise involving the determination of new land uses and may include the provision of new social facilities in addition to the building of new commercial, industrial and office accommodation. Much urban renewal is being undertaken in Australia by private enterprise, although public authorities are playing some part in providing housing and new utility services. It is surely for the States themselves to decide how much, if any, of the housing advances the Commonwealth makes under the agreements which have been entered into is to be used to provide new Government housing that forms part of any urban redevelopment scheme. If some large part of the Commonwealth's finance were to be allocated to assist urban renewal schemes less could well be available to meet urgent housing needs. Once againI stress the word needs'.

It has been suggested that an inquiry should be conducted into the extent to which the allocation of Commonwealth housing finance to the States should be made conditional upon compliance with standards of town planning and the provision of urban services. These standards of town planning and the provision of urban services are State matters.I am unaware of any request from any State for the Commonwealth to lay down such standards. In any case, are there generally accepted standards of town planning? Does the Opposition envisage new Commonwealth-State financial arrangements under which the Commonwealth would make special advances for the provision of urban services?

The last matter into which an inquiry is sought is land costs. Notice was given of this matter only last Wednesday. Without drastic action of a very socialistic nature it would be impossible to control land costs near the centres of our capital cities. I think it is a well known and well recognised fact that the amount of land which is available within 5 or 10 miles of the centre of these cities cannot be increased. With a rising demand the cost of this land must increase. It is true that the States might develop more land on the outskirts of the cities and, by this means, slow down the rate of increase of land prices, but even this is likely to be temporary. Anyway, where is the money for this to come from?

I have traversed in some detail the suggested matters of inquiry by the proposed standing committee. However, I want to make it quite clear that an inquiry of this nature would be most unlikely to serve any useful purpose. I believe that it would be a waste of time and effortto prepare a range of forecasts based on a number of differing assumptions. In conclusion I would point out that the Government is continuing to make progress in the field of housing. It is aware of the difficulty which many people are having in securing a home suited to their needs. It would be foolish and wrong to pretend that we have solved every problem, but no other country can. point to a better record and few can point to one nearly as good. The role of theCommonwealth in the field of housing isto do everything reasonable to help those in need of housing assistance and itwill continue to fulfil this role. It would not be appropriate for a Commonwealth committee to inquire into matters which arc the prerogative of a State without the invitation of that State and its local authorities. For these very obvious reasons, I ask the Senate to dismiss this motion as an irrelevant, time-wasting exercise.

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