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Tuesday, 27 November 1973
Page: 3879

Mr Keith Johnson (BURKE, VICTORIA) - Has the attention of the Minister for Urban and Regional Development been drawn to reports of statements made in the Victorian Parliament by the Minister for Local Governments, Mr Hunt, that Victoria would reject the Commonwealth loan for State sewerage programs because 'the interest rates were the worst ever proposed for the Melbourne and Metropolitan Board of Works'? Can the Minister advise the House whether that statement is true and can he also advise whether a further report indicates that Victoria has changed its mind in regard to its acceptance of the $9m sewerage loan?

Mr UREN - There was a discussion with the relevant 6 State Ministers in Canberra last week. Several of the Ministers were unhappy with the conditions of this year's agreement with the Australian Government in regard to their sewerage programs. The terms of the agreement were that $30m was to be made available to all the States, repayable over 30 years at the long term Commonwealth bond interest rate. The best terms that were available under the previous Government to local government and sewerage authorities was the local government interest rate which is one-half per cent higher than the long term Commonwealth bond interest rate and normally the repayment of the loan was over the much shorter period, generally about 20 years. We examined the requests of the respective States and we have accepted the proposal of the Victorian Government that there be a foncier proposal in regard to the repayments. This of course would lower the repayments in the early years. The Australian Government has also acceded to the request of the States that the repayment of the loan be extended to a period of 40 years instead of 30 years. This proposal now is acceptable to the Victorian Government and other State governments have intimated that they wish to accept it.

I stress that the sewerage program agreement is only for the term of this year. The problem has been that we have inherited one of the most serious social and environ mental problems in our urban affairs - the sewerage problem. We find that at least SO per cent of the people in Perth live in homes which are unsewered and that in Sydney and Melbourne approximately one out of every 6 families live in unsewered homes. When we examined the situation this year, we found that if we were to meet the backlog of sewerage requirements this year we would have had to make available something like $89m to the States. Cabinet examined the situation of the shortage of resources, both manpower and materials, and we thought that the most realistic figure to be provided in view of the inflationary pressures existing should be $30m. But I have stressed to the States that these proposals will apply only for this year's agreement, that it will relate only to the backlog. In future years there will be a long term sewerage program entered into with the States which will deal not only with loan moneys but also with interest-free grants. In future years, instead of dealing only with the questions of the sewerage backlog, we will also be opening up new areas, to try to reduce the cost of land, to provide sewerage and to improve the treatment of sewage under these programs. As is known in New South Wales the sewage discharged off Sydney beaches in many cases is untreated and, in fact, is creating grave environmental problems. The Australian Government will work with the State governments to try to overcome the sewerage works backlog in a new program as promised by the Prime Minister in his policy statement.

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