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Wednesday, 16 October 1974
Page: 1746

Senator CAVANAGH (South AustraliaMinister for Aboriginal Affairs) - I move:

That the Bill be now read a second time.

The Bill is an important one. Its purpose is to replace the Aboriginal Enterprises (Assistance) Act 1968, under which the capital fund for aboriginal enterprises was established, by an Act providing means of making loans to Aborigines both for enterprises as in the past, and for housing and for personal purposes as denned in section 24. Thus, the Bill seeks to establish 2 funds: An Aboriginal Enterprises Fund and an Aboriginal Housing and Personal Loans Fund. It is intended that both funds be controlled and administered by an Aboriginal loans commission comprising a board of 5 commissioners, at least 2 of whom are required in the legislation to be Aborigines. The commissioners, who would serve on a part-time basis, would be appointed by the Minister for periods not exceeding 5 years. The commission would be constituted as a corporation with perpetual succession and would be subject to the direction of the Minister for Aboriginal Affairs on matters of policy.

The Aboriginal Enterprises Fund continues the scheme established in 1968 whereby the capital fund for aboriginal enterprises may make loans to Aborigines and Torres Strait Islanders to start or develop business enterprises which have prospects of success. I draw the attention of honourable senators to the annual report on the operations of that fund for 1972-73 which was tabled in Parliament. I should emphasise that the capital fund has not been a 'hand out' operation but has provided loans on reasonable terms to Aboriginal men and women who have sought to improve their economic circumstances by their own efforts. This same concept would apply to the fund now proposed. The present capital fund is administered by the Minister as a corporation solely for that purpose. Under this Bill, the board of commissioners would administer the fund. It is proposed initially to appoint two or three leading financiers and businessmen, as well as at least 2 Aborigines, to the board of commissioners.

The establishment of a fund from which to make loans direct to individual Aboriginals to assist them to obtain housing is intended to encourage Aboriginals to become home owners. Few Aboriginals are able to provide homes of their choice for their families because they are unable to obtain finance from existing sources. Housing finance would be available to Aboriginals who could service the necessary loan repayments and maintain their homes. These would, until the loans are repaid, be subject to mortgage to the Commission. Only a minority of Aboriginal householders may be able to afford home ownership, even under the favourable terms of this scheme, but the need for such a scheme has been apparent for some years and it is hoped that increasing numbers will be able to buy their own homes with help from the housing and personal loans fund.

Few Aboriginal householders are able to obtain loans for the purchase of items such as household furniture and refrigerators, because they cannot establish to the satisfaction of the usual lending institutions that they are acceptable credit risks. The availability of personal loans to Aboriginals who are able to service the repayments could provide the means, in our credit orientated society, for many to attain the standard of living enjoyed by other Australians.

Personal loans would be available for the purchase of essential household effects including appliances, floor coverings, tables, chairs, beds and bedding. They would also be available to assist with payment of medical, dental, funeral and educational expenses. The purchase of motor vehicles would also be financed from the fund where the Aboriginal breadwinner's employment opportunities would be enhanced. I propose initially to direct the Commission to apply a general rate of 5 per cent per annum when assessing applications for loans for enterprise and for personal loans. This rate could fluctuate from an administrative rate of Vh per cent up to bank interest rate which is around 9 per cent. The rate of interest payable on housing loans would not exceed the rate, as provided from time to time in the housing agreement with the States in relation to homebuilders account moneys. The current rate is 5% per cent per annum.

With respect to housing, I propose to ask the Commission to consider utilising relevant services of the proposed Australian Housing Corporation, the proposal to establish which was reGently announced by my colleague, the Minister for Housing and Construction (Mr Les Johnson). The Bill provides that the staff of the Commission will be public servants and this will mean that the Department of Aboriginal Affairs will service the Commission. In view of the current restrictions on staff growth in the Public Service, it is possible that the extent to which the functions of the Commission will be capable of performance in the early stages may be limited. Nevertheless I hope that the Commission will be able to give some emphasis to the provision of housing loans within the limited scope in which it might initially be constrained to operate. I intend, however, to direct the Commission to examine other ways in which, for example, housing loans may be made to Aboriginal organisations on a 'wholesale' basis, to enable those organisations to provide loans to individuals. I commend the Aboriginal Loans Commission Bill 1 974 to honourable senators.

Debate (on motion by Senator Rae) adjourned.

Motion (by Senator Cavanagh) proposed:

That the adjourned debate be made an order of the day for the next day of sitting.

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