STATE ADVANCES

Evening Post, Volume CVI, Issue 8, 10 July 1923, Page 4

STATE ADVANCES

S^GOVERNMENT'S NEW

SCHEME

SOME APPREHENSION DISPLAYED

RESTBIOnON. OF BUILDING COSTS.

Whs State Advances Amendment Bill was before-the House of Representatives last night, and the housing difficulty in Nfw Zealand was prominent amffns tho subjects discussed. -;—■ ■ \^"'"'\"".

The Prime Minister traced tie-history of "the Advances Department. -Under the new legislation, the maximum that might be allowed would he increased to '■£1350. It was not likely that many workers would be able to. take full adrvafitage' of that. The Government; would advance up to 95 per cent, -of'the total cost of the house and', section, not the total valuation. The provisions for f-et-tlers were also important, and the increase from 60 to 75 per- cent- in' advances would more than meet the valuation difficulty. The increase in' tho maximum to "£3500 was very important, and should go a long way towards meeting: moratorium- difficulties. . The average amount borrowed by settlers to date was £1250. Ho did not think he was running any. risk--in increasing the maxi.jiuni. the board was a very able .one, an 3 would safeguard the Government's position. -It was.going- to be easy- for those who obtained advances ?to secure the freehold'bnco. they satisfied: tho Ad-, vajices.,-Board" that they were- genuine settlers. The Bill had been very well thought out; Tlie Department was already doing- a great business, and repavnienis of iiiU-vest and. sinking fund totillecf nearly Sl.0l)0 ; 0G0 per year. Last year.,, ujudyi-. the -Advances U> . \Voriers Act 1585 applications were received, and £753.G1'2 was paid over. Local authorities were indebted to the Department to. the extent ■ of. £2;573 : 071. Tli-s business so-far.was small, 'conrpared with what Sti would be in the future. However, he :quld see no difficulty iii providing all the money that would be required during the present, financial: year: That was a big thing to say. The Leader of the Opposition : "It is." •Tlie Prime Minister-:.. "Yes, but it is »ras." In bringing down the new legiseation, the Government had been, prompted:, by the shortage of ■houses.'in Auckland and. \Vpiliiigtoii 'particularly, and byfOiejjpprmchr'-'flf-'ths eiid-of-the mc-ra-tomuut.'perio'd^y.lVafore Uie end-' of tlie pc'isejit;';ye'jir.3tc;3ipp.ed ■ tdl increase tho ca|itfll"'-of--tnp '•Department to "£-20,000,----000. "C^:x^.:, ':*:_,.::,;. \:r :; ■":., ■•. The'Vliea'aer of,Vthe Op-position: -That, means"apptlier. B^OOOjOOO." ■Mr. Massey : -':-Yes, and I have '£•!,• 000.000 i-n .sight:" ■ Before .'the Bill .wont through :the "Coinniitte.e "stages, he would isk the House',to?gratitJnm a' borrowinof authority'in.order -that":he could be bii' the safe side." '"■;.'■' ;'.'•".. ...... % ; .NO'T SO::,;OETI\USTIC. '/ ■. -The Leader of :'tiio-Opposition' said te wisliedllieVSould; botSsSb^Stiini^ti.cXns theEtime^Minister:.. /Hb.w;evevi';'he i;;;realised that moi-tgag^/ytoklliii'^' .£150*000,000 •were sheltering-., under,-.tlie" moratorium. IT. the.limit-proposed' in the Bill was advanced in every case, £3.500,000 would not cover the requirements of one provincial district he had in mind. The iAdvances De]>artm2nt would not meet the demands in the country for money. A..'sum of £23,000,000 would not meet Vhbse demands.' TJio Government- was hevely trying to meet the desire for the j istabfishment of an agricultural bank. '&& to housing, the reason.for .the.short-.i was the tremendous cost of building materials. In his electorate there- was-' f, man who decided to try out the cost of. .Meeting-,a; house if.,the.builder succeeded /a~ dodging combines. Mr. Wilfordproceeded to'give the specification's of a jveil-fifafced, modern house .of. four. rooms, with bathroom and outhouses erected - at' Petono for £603 las Gd. including- tho section (£100). • The house -he referred to-was No. 3, Adelaide street, Petone, in'd it was an excellent house—a capital aome. How was it that similar houses Use where ran -up to £900 and over? The Prime Minister :"We can build B jvery. good:.,house of Sve rooms for ■firpo." *•.. ~ -s. '■■• •- ■• ...v. ,-,

ffh&. Leader- of the Opposition * sSld'that another 1-, resident yin his dUtriiif burchased from the Department for cash h section at a cost of £14]. He a'oplied Wthe Department for a loan of £700, 5nH the Department'offered him £630. Ha, predicted that as soon as the Bill' fcecaaie"lav/,-ther-price--of-: iaiul; -timber,-, and hardware would increase everywhere.- He had' little faith in the Bill, because, while it increased the amount >I : -money advanced, it did not restrict :he cost of the house. It had been Jhgwn-Jn" England that as aooii-as" money ivas made ' available for building, uj> tvent the price of everything, 'laud' included.... Tv;o, practical men, an arcln- | test and a builder,-should-be put on the State Advances Board., At present peo- | ole were not getting a .fair deal. Direotiy/^the present Bili was passed many people would be applying 'f O r formsr loans to be consolidated, or to obtain assistance to '■ meet tho moratorium ?.I«ch Ss he -welcomed the Bill, he "ivas afraid it. was not going to meet the demands that would be received. ■ NO PREFERENCE FOB SPECULA- '| "■ TOES. . . . "Mr. JE.. A. Hansom (Paiiiatua) could not see Avhy thp" 'Bill did fiot propose to ■give assistiuicc to those who' had a mortgage at' .present. It only was another instance of Reform methods. The- Prime Minister: "W,i are csr-' tainly "iifit "goiu.or to give preference to the speculators." Jlf." 'Rans6m: "Yoii' are gohig' to create speculators/ , *" " ?Ir.- F. F..-lloekly,.(Eotorua) -expressed approval of the Bill. and tliou^Kt the Government should be complimented on It;; Anything that would tend to get a 'worker his own homo was to bo approved. He would nrefer the limit of ' £3500 to be extended to £0000, as it would then include many who 1 were having- difficulty in regard to their finance. If a- man . went to the State Advances .-Department' with sufficient security they coii!d generally reckon' that he 'would £st fair treatment. The Louder of the ."Opposition had been eornewhat pussimistic,- tat.surely Mr.;, Wiiford. cuuld give, credit, for the Oovcrnnicnt's c:bod inten-

tioiif. In regard to the lending of '.noneys -for improvements, lie -thought (bat some supervision of t!?c exnsndifcurb should be exercised.-- 3lr. Hockly. did mot think it-would be possible to borrow money' from the Department and lead

5£ afterwards at n higher rate of interesfc. /is the. Superintendent of the De- , ,partrn.snt' was a very live mail. Why should ■ prices go np us soon ns tho Bill passed ? -Surely competition fwould cr«- . tci: iplo the matter. There was a risk ,tha(r tli-ore. might be insufficient labour to t-ope" \vith. the. demand, but that could

■bo overcome by;immigration. The.more 'skilled -artisans that came into the coun- ■ try- the better it would be. There was

no need for two practical men to be on the board, which was already well safeguarded. " "ilf. lloekly denied that there wastmtiro-lhuifotio Value, for. land- The. Valuer : .Genera! had laid -thai principle, down, and stressed it upon bis officers. It was a foot, however, that loan applications', \v_ere refused without '» reason ■hemg•• assigned, and that should be remedied. If the applicant were inform'M Pf &c reasons for refusal it woidd do

much to restore confidence in the State Advances Department. So long as the present scab of fees was paid to local valuers, it would be impossible to secure tlie services of a. good 1 class of men. The Act should be made as '.vide as possible. Provision should bo made for the Superintendent to, exercise latitude in respect to securities, provided he was satisfied they were safe. A LABOUR. CRITIC. My. R. JM'Keeu (Wellington ' South) was. not optimistic about vhe Bill.'Many ol the working fawners would benefit oy tao £3500 advance, but the S5 per cent clause would not make provision lor y5 per cent. ■ of (he cost of building a house. "As approved by the board" were the determining words of tlie clause. There was no thot an iipphcantwould get."9s per. cent. The Act -was"-nothing less than political win-dow-dressing. Already there was power m the 1919 Housing Act to enable ' a man to^ build a house on £10 deposit. If the Government would provide, money to advance 95 per cent, of the purchase price, surely it could finance those'who wanted to build, under the 1919 Act. The clause giving the freehold in respect to houses built, under the 1910 and 1919 Acts would make for speculation, for a person could get the freehold of such p. house and do what ho liked with it. There were no means proposed to 'prevent speculation such.-as existed in the i earliest housing .legislation. The Government' should give power (o the superintendent to extent (lie term for which advances were made under the 1919 Act." Tbere were many people who were goJng back in their runt, and the capital cost of the bouses built under the 1919 Act should. be reduced. A colossal blunder had been made by the Department ..in respect to the" erection of houses under this Act, but the people who bought them should not be made to pay. These people had sianed an agreement to nurchase for £850. but it was afterwards found that the cost woiikl- be increased owing ,<■> departmental u>niadmiiristiT.t:ou. The occupiers had ■ no alternative but f.n take these houses, or else they would have touud themselves in. tlie" street. A STEP IN THE DARK. The Minister of Labour (Hon. G. J. -Anderson) stated that Mr. M'Keen had not told (lie House that the people who had taken six of 'tho houses, at Mivamav had done so knowing full Well that the Department did not know at thetime what the places were.going to cost. When the speaker saw that people earning £4 or £5 a week would not pay the high prices which would have to be paid for the houses he stopped building. He had then offered. to build another class of house ,at a cheaper price- but was told -'that they were not 'good enough so did not go o:i with tho matter. If the Advances Department cared to reduce the valuation of the houses, well, then, he would bo contented- Generally speaking, ho considered there was good value iv the houses. There, were s-ome defects in several of'the houses, but he had given instructions before giving np charge of the Department to have these remedied. The only fault about tho honses'was that they were "much of a sameness." Nrtw, however, ?.t bis .-suggestion, a worker who I was thrifty enough to save. 5 per cent, of 'the cost could have a house erected to his own design. To meet cowrestin'i in the cities he thought it would be necessary to build large flats for tho •workers, but that was not a matter for the Government but municinnl authorities nn«l private enterprise. He t'houslif the Bill woiilc! do much to relieve (lie house shortage. NO PROTECTION. AGAINST I - . EXPLOITATIOK. : j Mr. W. E. 'Parry (Auckland Central)' said that it. the Prime Minister"-viewed-' with dissatisfaction- the Labour view of ! the Bill lie hud himself to blame. The Labour 'Party believe that the legislation already on the Statute Book was 'more comprehensive. If the present Bill' .became'law and did all the Prime Minister claimed for it no party would bo more pleased than the Labour 'Party.' Hu saw tho danger' of increasing costs as_ soon as the Bill was passed. The jtf'mists-r of Labour . expressed surprise that occupiers of workers-dwellings recently erected should demand a rovaLtatiou. Were they in a different position to soHier-set'dsrs. who would be grant-■•.ed,-.revaluation 1?. -The Bill did not p-o----tect the: workirif; class from exploitation tiiab was bound- to- take place. The •Prone .-Minister was very optimistic' about finding money... Why,-Auckland needed . at. least two thousand houses It would require ' £3,000,000 to satisfy . Auckland alone. He urged the 'Government to throw open what land it" Had in the main centres of population, po r?s to provide a brake .on private 1 landholders out; to exploit the worker.' .; „, .;';. CAUTIO?^ NEEDED. ■' ... Mr. T. W. Rhpdes;:(lhames) said: the proposals were all; .'rif-ht; ( but the : Act would have to be "adminis! ered with 'caution. It would-be for the Government to see that the sawmiUgrs aid! not increase the price.'of tiaibei-. Timber prices should be "fixed.by the Government, and if that'method .was imprac-, tical or ineffective, the duty on imported timber should be 'removed: The State should also pvovicio/'kud'at' a reasonable price. The Bill would restrict, private enterprise. The Government would have to beware of the speculator—the"'' man who borrowed at a. low rate of interest from the Government and . re-lent".'the money at ah increased interest rate". TOO MUCK NERVOUSNESS. ' .^ The Hon. D. Buddo' (Kaiapoi) said tnc .tiill was a welcome addition to the 'work of the session, and hn did not think it would, increase the price of building. Ho thought there was, too much' nervousness about. wjiat was going to happen when tho.moratorium was liftsd, but what. information ■ was available- to Government' Departments should bo mado public, .so .'as. to let people know; what.they might have to -face. Tho Government should- see' that,, some o£ its empty houses''were' occupied.'. Sir John Luke (Wellington North) did not-agree-with; building flats for working people to live in. To say that there was -not enough land in New Zealand ior workers' houses was not a compliment to tins country. The whole of the It Aro iia.t was becoming a commercial area, and people.had to go into the suburbs. 'To meet, the needs of those people it would be necessary to run cars all night, otic car per hour, in tin.- mi tie way as w.-is done in Sydney. Tin- V/el- ) liiitTton City Council bid attempted the building of houses, but the scheme hnd not been 'satisfactory. There were flats in Wellington. ,but 'these were available to people- who earned higher siilaries tliari working people could command. Tin did not think the Government would be doing its duty if.it lifted the moratorium ■ before cheap money became available again. He heartily .supported the Bill. Mr. F. Langstone (Waimarino) suggested that the amount advanced to settlers should be the same as that to be advanced to workers—-95 per cent. Hous-ing-was a. national problem; and was ... one of the things'that' the'people had : sent members to Parliament -tn- le^is- ; late about. He was satisfied that if'the : people knew what was in -the 1919 Art they would ask for nothing; better. AH that was_ wanted was sympathetic administration. :

Mr. O. J. Hawken (Egmont) thougiu the Department, would have to standardise tEs c.cwt of er.eotion pi different

classes of houses, otherwise prices would rise unduly. It' was not so much the price of materials that affected the cor.l. of building, but high rates of wages. Already, the carpenters were askingfor increases on current rates. At 11.35 p.m. the debate was adjourned on the motion of Mr. l\ A. de la Parelle until 2.30 o'clock this afternoon.