PARLIAMENT

Dominion, Volume 13, Issue 17, 15 October 1919, Page 8

PARLIAMENT

MORTGAGES EXTENSION THE SHORTAGE OF HOUSES GOVERNMENT'S EFFORT TO SOLVE THE PROBLEM - The House of Representatives met at 2.30 p.m. yesterday. The Treaties of Peace Bill, the External Affairs Bill, and the Howard Estate Bill were introduced by GovernorGeneral's Message and read a first time. MORTGAGES EXTENSION BILL. POINTS OP DETAIL. SIR JAMES ALLEN (Minister of Finance) moved the second reading of the Mortgages Extension Hill, and he briefly explained tho effect and purpose of tho Hill. Sill JOSEPH AVARD (Leader of the Opposition) said that he thought the Bill was a good one, meeting the now circumstances of peace in a satisfactory way. Mr. W. A. VEITCII (Wanganui) asked whether the Hill covered the case of a mortgage over a-lease—a. vanishing asset. Mr. G. WITTY (Kiecarton) asked about the case of the mortgagor paying back a part of the principal. He asked whether so'mo notice would bo givon. Was it fair that the mortgagee should be given back instalments of the principal without notice'f He might not bo able to re-invest H. Mr. Hemes: Put it in the war loan. Mr. Witty: And get 41 per cent.! Supposing ho is a poor man, and he is going to get -IJ per cent, instead of sixIs that a fair thing? He said that often mortgages were held by "a. widow woman" and were her only sourco of income. v Faults? SIR JOHN PINDLAY (Hawke's Bay) 6aid that ono weakness of tho Bill was that- it did not give power to the mortgagee to prevent a vmdictivo mortgagor from doing irreparable damage to the property security dor the loan. Ho mentioned tho ease of a mortgagor who cut dowii trees. Tho Court, ho thought, should have power to givo tho mortgagee tho right of immediate possession or power of sale. He referred also to tho case of tho men buying tho house on a small deposit of, say, ,£SO, agreeing to pav interest and instalments of principal. This contract might have been made last month, but yet, purchaser (and mortgagor) might snap his fingers in. (ho. face of the unfortunate vendor and refuse to repay ai|- of the principal moneys.'- Ho would suggest that these two points should bo considered by the Attorney-General, the author of the Bill. Mr. T. M. WILEORD (Hutt) spoke of procedure amendments whjch he proposed to inlroduco in committee. He sunported the contentions raised by Sir John Eindlny. He pointed -l<> the fact that a new duly was being cast upon Magistrates by their being asked to adjudicate on questions under, this Act, while tho sum involved did not exceed 1 .CSOO. He hoped I hat tho Government would this session bring down legislation to give the Magistrates salaries commensurate with their duties.

-Mr. AV. TJOAVNIE STEWART (Duncdin AA'est) said that the reason for the conferring of theso special powers on Magistrates was that in some remote districts'it would impose tho heavy cost on the parties to require them to apply to the Supreme Court. He did not think, the case mentioned by the member for'Hawko's Bay—that of the mortgagor who destroyed valuable trees—would occur very frequently. He would, however, be prepared to see the period of notice prescribed reduced from . two months to one month. Two Kinds of Mortgagee. '■ Mr. C. J. PAKR (Eden) said that the, Bill would be welcomed as giving finality to a question that had been very much discussed in recent years. He 6aid that mostly the mortgagee could look after himself, but often the mortgages was a trustee for widow and children, and mortgagees had suffered by the acts of conscienceless mortgagors taking -advantage of the Act. Tho provision of a two months' special notice, referred to by the member for Hawke's Bay, was quite unnecessary. It had not' been found neeessai-y in war time, for the Courts certainly did not lean I.'' tho lenders Ho approved of tho idea of giving the Magistrate power' to deal with mortgages of low denomination, and he would be prepared to vote to give them power to deal with mortgages up to £1000 in value. He approved of. the general idea of tho Bill, saying that he was not one of those who favoured a sliding scale for repayment after tho model adopted in Australia. Mr. R. P. LEE (Oainarn) discussed difficulties of procedure. Mr. 11. HOLLAND (Grey) said that in his opinion the Bill ought to be passed in its present shape. This was a land of mortgages, and the mortgagor was often the small working farmer, or the working man buying" his homo. Ho supported the retention of tho clause providing for two months' notice in which the mortgagor might mnke objection, prior to application to tho Court by the mortgagee for power to use his rights under the mortgage.

Mr. Payne Says Things. Mr. J. PAYNE (Grey Lynn) said that the business of this country—production from the soil—was largely done by small people. Therefore ho was surprised to sea the concern of members of the House for the money sharks. His own idea was, Hiiifc once a 'mortgagee lent money he should never be able to foreclose as long as tho interest was paid. Mr. M'Callnm: Oh! Mr. Payne: I know it surprises you because you are so damnably conservative you can't understand. "Mr. W. T. JENNINGS (Taumarunni) said that the Bill would be oppressive on those people in the King Country who had lent money on Maori leases. Mr. R. M'CALLUM (Wairan) said that the sympathy of the country wn»certainly with the borrower. But he pointed out that tho greatest and most frequent borrowers were the speculators, and the House ought not to protect tho speculators as against lenders of money. Ho declared that the statements of the member for Grey Lynn were "outrageous." If any group of members of the Hon re, other'than the members of the Statutes Revision Committee, thought they could draw a better Bill, they were welcome to try. Mr. A. HARRIS (Wnitematn.) said that it seemed to him that the bulk of the mortgages, say four-fifths of. them, would fall due' on Becmnber ill, 1920, and the rush for money must have tho effect of pushing up-the rate of interest. If this was to be the effect, then clearly the mortgagor was entitled to further protection. Mr. A. E. GLOVER (Auckland Central) said that he sympathised with the borrower, and he told a storv of how once ho borrowed JSOfl. raid £M in interest, and stil! owed X2OO. • , Minister's Reply. SIR JAMES ALLEN, in reply, said that the period, of two months' notice was provided in order to avoid expense. If a mortgagor were called upon to pay up tho principal it was reasonable to 6upposo that poor men would require time within which to raisethe money. As to the Fccond point raised;by tho member for Hawko's Bay, the question of the obligation on the mortgagor to make repayments of principal in terms of Ill's contract, he would prefer to con. suit the Attorney-General. The legislntio i as it hail stood in Now Zeai'nnd (luring-th" war had been copied in every part of the Einp'ie, and it had been framed bv tho Attorney-General. The Bill was read iv-second time. HOUSING BILL. THE WAR TJIEKICTILTIES. Tho VIUMG MINISTER (Mr. Massey) moved the second readng of tho Housing Bill. He said that the purpose of the Mill was to get over n set of difficulties which had arisen as the result of the war. During the war lime there had been little building, due to the fact that materials were scarce and labour difficult to obtain. Labour was still difficult to obtain, and materials were

scarce and expensive, but building must go on. lie explained the parts of tho Dill in detail. Referring to that part dealing with the special case of public servants, he said that no section of pcoplo had suffered so much liy the lack of houses as members of Hie Public Service. Those 10s. 6d. a Week Houses. Sttt JOSEPH WARD (Leader of tho Opposition) said that owing to war causes the activities of tiio speculative builder had been stayed, and th.s was tho cause of tiie shortage. He pointed out tnat tho proposals of the Government to lend money at five per cent, on properties of the value of Xl'id the interest payable would be Ms. Bd. a week, wlucli was altogether too high. He had been much misrepresented on account of his proposals to provide Houses tor the workers at 10s. (id. per week, lie proposed to tell tho House'how this could be done. The State Advances Department had made profits of i'JoO.OOO in twenty years. Money could bo provided at' 3i per cent, with sinking tund added, and tne. State could make a profit. The money could bo found without borrowing in tne ordinary way, for the result of the last war loan showed that tho ordinary builder would not subscribe tiio muiß-y. Por this housing scheme tho money could bo provided from the Post (Jllico Savings Dank, which had always large sums from year to year available lor investment. There could be no question of tho money being available. Mi-. Massey: Except that if you use it cunt way you can't have it for public works. - Sir Joseph Ward said that; not nearly all the funds of tho Post Office were used tor public works. Mr. Massey: We aro going to use more, though. ~.,,.',■ Sir Josepn AVard said that in his opinion tho people of this country would have to provide tho money required lor public works, and they must lie offered a rale ot interest sufficient to induce them to lend tho money. He would, favour the removal of tho restriction, on incomes of applicants for houses, and ho would favour also the extension of the period of repayment. ( Concrete Houses. Sir Joseph Ward said that the houses should be built in concrete. The supply of materinl was plentiful in most parts of tho country, and there were many advantages about concrete construction. Wiiodcn houses were Inot permanent, and thoy would complicate the housing problem. The Government in the past had lent money to local bodies below cost. He did not think the Government should aim ;rt any profit upon homes. If houses -voro built of concrete and if the repayment was spread over a period of 66 years, the cost would ha greatly reduced. A sinking fund of I per cent, would extinguish the loan in C 6 yeaTS. Ho 'vas satisfied that the principles embodied in the Bill wero sound. The Dominion was going to have a pretty difficult row to hoe during the next five years, and the Government must aim at making it possible for,people to live on their incomes without (feeling, that they wero losing money and falling back. Facing a Loss.

Mr. C. A. AV'ILKINSON (Egmont) expressed general approval of tho Bill, which followed to somo i stent tho recommendations of the Industries Committee Ho thought the Government ought to be prepared to foco somo loss in connection with its seheino of house-build-in!!- . .... ... Mr. Mossey: Yes, in connection with our own building, but not en-advances to employers. Mr. AVilkinson said many of the largo employers were prepared to subsilisn u housing scheme. Tho new houses, in order to secure economy, would require to hn erected in blocks. The men in control of the 6chemo should be practical men with initiativa and enterprise. The limit or income should, bo lifted to ,£3OO, with .£25 additional for each child over three. Ho suggested that tho people should be given power to secure the initiation of a housing schenio in any district whoro the lccn.l body proved inactive. Tho Hon. D. BUDDO (Kniapoi) pointed out that some of the gravels of the Dominion did not produce damp-proof, concrete. The houses ought to be built as near as possiblo to the centres of employment. He agreed that homes of a reasonably permanent character ought b be lpuilt. Tho wooden house, with a lifo of' thirty or forty years, was not economical. There were I ouses in Britain that had been occupied for 500 years and wcro still sound. A Matter of Price. Mr. C. J. PAKE (Eden) said the housing problem had existed before tho war,j and it had meiely neen accntuated in recent years. The trouble' all along had been to provide houses at a cost that would be within . tho means of an ordinary worker 1 . Tho municipalities had been alarmed at tho prospect of an. increase in tho rates. State buildings so far had been a failure, because the right sort of tenant did not get tho State homes. Most of tho workers' dwellings at present were occupied by men enrning .£5 and M a week. The simple fact to bo faced was that" a suitable home could not be built at a price within tho means of the average worker. The State must .bo prepared to face a loss. No privato builder would erect a five or six-roomed brick lionss with proper accommodation under .-CIOOO. Mr. Parr predicted that much money now on deposit in the Post Office Savings Bank would bo withdrawn when better investments became available. The scheme of finance suggested by Sir Joseph AVard required very careful consideration, sinco it assumed' that the 'deposits would continue to grow. The improvement of suburban railway services was an important part of any housing scheme. Mr. J. T. M. HORNSBY (Wairarapa) urged the Government to use tho State sawmills and standardise materials. Concrete houses could be built for J!000 each if the Government went about tho business in the right way, but a "building ring" would block the scheme if it could do so. The housing nroblem was liot confined to the cities. It was being felt in the. smallest country towns. Low Rents Essential. Dr. A. K. NEAVAfAN (Wellington East) s.iid the Government at present could not build a worker's home-that would cost less than 225. Gd. per week. The cost would be greater under the present scKcms. A working man could not pay such "n. rent and at the same time bring no a family properly. The British authorities had faced: the sanio position, and had realised that they must face a loss which was shared by tho Government and the municipalities. If this was nut done in New Zealand the poorer workers in AA r ellmgton would still have to live under deplorable conditions in rooms. The outside rent of a worker's home shomd not be raoro than 12s. or ]3s. He suggested that tho State homes, let at low rents, should not be sold. The people who could afford to buy could pay tho higher rents. _ The cheap cottages should' remain available for poor people. Construction ought to i be standardised for purposes of economy. Cheap houses need not be ugly. Beautiful plans could be bought in any bookseller's shop. Standardised plumbing, water supply, ami lighting arrangements would reduce cost. Fences wero an unnecessary expense, which had been abandoned in'many progressive towns. Mr. H. HOLLAND (Grey) approved generally the principles of the Bill, but said the scheme would not provide homes costing less than 255. a week. Tho average workers could not pay so much. * His rent should not exceed one day's wage. The limit of income under the scheme should not be less than .£3OO. If: would bo dangerous to allow large employers to control tho housing of tjlASv Ol'-nlnvpps. Mr. H.. G. ELL (Christehurch South) said that before , the war the Belgian Government had lent savings bank funds to the workers at 3J per cent, for housjng •itirposes. The principle was a sound one. The Cass of Wellington. Mr. J. P. LUKE (AVellington North) discussed tho Question of providing I houses for rent. He said that local I bodies would bo more susceptible to influences thnn the general Government in the matter of payment of rent, which might fall into arrear y lie approved of purchase as the method of disposing of houses, and if a man were to leave a district ho could have the wholo value of his interest returned to him. In very

few cities in tho world had the difficulties Mint had been faced by Die municipal go\ eminent of Wellington been found by the municipality. The tramways had cost about .£20,000 a mile as against .010,000 a mile in Ghristehurcli. He thought that the municipality was enti|U.|i to much credit for .its. achievements. The city bad been badly laid out, but the city had certainly progressed in -many respc.-t more than other cities in the country. He would not submit to tho general criticism that in any respect the government if tho city had been lax. The state of affairs in regard to housing was very much to be regretted, but the City Council had not neglected the housing problem. -■, Areas of am acres had been purchased.'' It was not lo be contemplated that the city should embark on n scheme of wooden houses. The dwellings should be of concrete or other permanent materials, He referred again to liis pioposals regarding hutments at Trenliiam for reconstruction in Wellington as einergencv homes. It was hopeless to think of occupying warehouses and offices us residences for people, because there was a shortage of warehouses and offices in Wellington, lie was not well pleased with the handing over of the administration of this scheme to the Labour Department. There should be a new Department with a good, well-paid chief at tho head of it. Wellington was overcrowded, but much of tho blamo for the bad state of sonic of the dwellines was due to the occupiers. lie tliouahl the Government should bear the linaucial burden of the scheme to a sufficient ex'.ent to allow the people to get houses cheaply. It would be better for the Government to cany the burden than for the local body to have to provide the money from nites. He conmituiated ihe Government on the introduction of the Hill.

Mr. It W. SMITH (Waimurino). said that the Bill was a very good liberal measure, an honest attempt to deal with a very urgent and difficult problem. Tho Bailwav Department ought to set other employers an example by adopting * big housing scheme. The Housing Hill was read a second time. The Mortgages Extension Bill was put through all stages and passed. Tho House rose at 2 a.m.