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Monday, 12 November 1973
Page: 3114

Mr HAMER (Isaacs) - Australia is a nation of home owners. That is the way the great majority of Australians want to live, and home ownership has been a great contributor to the stability of our society. Therefore, it is the task of government to see that in this respect the reasonable demands of the Australian citizens are met. I would suggest that this Government is failing very badly in that task. At present we have employed in the construction of new houses and flats a labour force of about 80,000. They are capable, with current techniques, of constructing about 140,000 dwellings a year. There is no doubt that the demand for new dwellings at the moment exceeds the supply, and the effect of demand exceeding supply, unavoidably, is always inflation. Not only is the effect of inflation to put up the cost of house building, but also it becomes very difficult for the lowincome family to secure suitable accommodation. These are the people that the Government is harming most although it claims to be trying to help them. What is being done by the present Government? The obvious way to match the imbalance between supply and demand is to increase production. What is the record of this Government in that area? The Government claimed that one action which would achieve some results was to cut down on the construction of city office blocks, apparently believing that this would increase the availability of labour for the construction of dwellings. This, as I am sure everyone in the Committee knows, is quite false. The materials used and construction techniques employed and the labour required in the construction of city office blocks are neither available nor suitable for the construction of suburban dwellings. To argue that by monetary or capital policies the construction of city office blocks can be reduced and therefore more dwellings constructed is thus quite false. I am sure that the Minister for Housing knows that argument to be quite false. At least that action by this Government has not actually ^educed the supply of dwellings as many of its other policies have.

For instance, the Government has eliminated the investment allowance in respect of new investments in plant and equipment. This can do nothing but reduce the increase in productivity and therefore the supply of new dwellings. As an example of what can be achieved, between 1960 and 1972, the total employment in the construction of new dwellings rose by 30 per cent but the number of new dwellings increased by 59 per cent. All of that increase was not the result of a rise in productivity. Some was due to changes in the balance between flats and other types of dwellings. Nevertheless, a substantial part of that increase was the result of a rise in productivity following wise investment in new plant and equipment.

The second negative effect of this Government has been the vast increase that has occurred in industrial turmoil. The Labor Government claims to have a special ability to reduce industrial disputes. The effect since the Labor Party came into power, as everyone knows, has been exactly the opposite. I do not need to dwell on the imminent strike by building labourers-

Mr Les Johnson (HUGHES, NEW SOUTH WALES) - That is about State issues; you know that.

Mr HAMER - State issues indeed but it has been caused by Federal policies.

Mr Les Johnson (HUGHES, NEW SOUTH WALES) - What nonsense.

Mr HAMER - I will come to that matter in a moment. The next action of this Government to which I refer was effectively to cut the supply of labour. There is an acute shortage of bricklayers and a shortage, but not so acute, of carpenters. Some calculations have been made of what the increase in the labour supply for dwelling constructions should be. The best estimates that I have seen are for an increase of 5,500 a year. Obviously, apprentices should be encouraged as one of the main means of increasing the supply of labour. But migrants are also important. I will take one example, that of bricklayers. Currently, the most critical shortage in the building industry is in this area. The Committee can see the significance that overseas sources play in the supply of bricklayers by these figures, which are for the last 3 years. In 1970, 321 apprentices and 1,152 migrants became bricklayers in the building industry. In 1971, there were 231 apprentices and 786 migrants entering that industry of bricklayers. In 1972, new bricklayers came from 231 apprentices and 620 migrants. What this Government has done by its policy is actually to cut back on the number of migrants and so create an artificial shortage which has increased the cost of housing. This in turn has affected all Australians who wish to have new dwellings.

What action should this Government take? I know that the Minister for Housing is aware of some of these areas of concern. He is doing something about them. The trouble is that his actions and his policies are all too frequently frustrated by bis colleagues who do the exact opposite of what is required. Let me explain what is needed. Firstly, every effort should be made to recruit building tradesmen overseas. They should be given assisted passages under our immigration scheme. Secondly, priority should be given to adult training and retraining in building trades. In this area, nothing significant is being achieved. Thirdly - in this respect, I do give credit to the Minister because he is trying to do something about this matter - every effort should be made in respect of design and method of construction to economise in the use of scarce tradesmen.

These are actions which should be taken. But until the Government does this and until it has increased the availability of labour and the ability to construct new dwellings, it will be deceiving and damaging the community if its policies lead to an increase in demand without an increase in supply. The inevitable result, if the Government causes this to happen for doctrinaire reasons or through mere incompetence, is that inflation will occur in the costs of building and this will harm all Australians.

What has this Government done to control demand? The Government has made a great point of increasing low interest Commonwealth funds for welfare housing or for those types of dwellings. This is admirable. But the trouble is that Commonwealth funds have not usually reached the people who most need them. This is more so when the Government in increasing the demand for this housing without at the same time effectively restraining the demand for other types of houses has increased the cost of housing for everyone to the damage of the whole community and in particular of the people whom the Government claims it seeks to help. In order to restrict demand, because it has not been able or willing to increase supply of dwellings, the Government has raised interest rates on new housing loans. The interest rate is now more than 9 per cent and will inevitably go higher. These increases hit middle income earners very heavily. The increase in the rate of interest for housing loans will be extremely onerous and extremely damaging. What this Government has succeeded in doing in a short time in office is to exacerbate the housing shortage. It has done nothing constructive yet and it has a serious responsibility for the present difficulties with housing.

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