CHEAP MONEY FOR HOUSING

Northern Advocate, 11 December 1936, Page 3

CHEAP MONEY FOR HOUSING

PLAN SUBMITTED TO WHANGAREI BOROUGH

“The easiest thing we have found during our period of office has been to raise money,” said Mr J. G. Barclay, M.P., at Whangarei last night, speaking of the Government’s housing policy. , “The Post Office savings deposits are going up 'at a faster rate than ever before, the increase for the 12 months ended October last being £3,800,000. “This money has to be used by the Government and we are lending it to the working people to build homes. Advances under the State Advances Department have Increased from an average of £40,000 monthly to £190,000, and after the mortgage adjustments are finalised the rate of lending will be accelerated.

“The State is building houses on its own account and is advancing money to public and semi-public bodies for building for their own employees. This week I have placed before the Whangarei Borough Council a plan for obtaining cheap money to extend the system to this town. No Comparison.

“The rate is 3 per cent., and whether the scheme is accepted or rejected it should not be compared with another scheme which operated a number of years ago, and which was financed with money raised at between 5 and 6 per cent. I am not anticipating such a position arising in Whangarei, but we don’t want local bodies not to take advantage of the £1,500,000 offering simply because their members opposed Labour at the election.

“I have heard that the Right Hon. J. G. Coates has advised the people of Dargaville to avail themselves of the cheap money offering. It is preferable, for the purposes of decentralisation, that local bodies, with their local knowledge, should undertake the supervision of the scheme. Mr Barclay said that a subsidy from the Unemployment Fund was no longer necessary to induce building. In fact, Mr Lee’s greatest difficulty was to obtain skilled artisians. If the 40,000 unemployed were trained carpenters, half of them could be absorbed without

difficulty in the next few months. The tragedy of the depression was that men were not trained in crafts and trades. Then it was far more necessary to use the national credit, as Labour was doing today.

A Nominal Bate.

For the purpose of its own building scheme, . the Government was raising between £3,500,000 and £5,000,000 ■through the Reserve Bank. “I cannot tell you what interest we are paying,” he said, “but it is merely a nominal rate.” Borrowers under the scheme may become purchasers, provided that they use the homes themselves. We will not permit trafficking in these houses, and capitalisation of the, lower rates of interest procurable. “The Government has a horror of another orgy of speculation, and that consideration alone prevented us from going even further in lessening tiie rate of interest.” At present, Mr Barclay said, loans' were restricted to those in receipt" of less than £3OO per annum. So long as a man had a decent equity in a section and a steady job, he would be entitled to an advance.

Responsibility on Local Bodies.

At question time, Mr Balfour said he understood that the Whangarei Borough Council had turned down the suggestion of raising money at 3 per cent, from the Government for a local building scheme. He inquired whether, in the case of local authorities refusing to avail themselves of the cheap money for the replacement of slum area, the Government would adopt compulsory measures.

Mr Barclay: No. We are throwing the responsibility upon the local bodies. If they will not build the houses we will come in and do it ourselves, but a longer time may elapse before construction gets under way. I have every sympathy with those local bodies which burnt their fingers with building schemes in the past. Any candidate for a borough council who put forward a policy of increased rates would be defeated. The burden is heavy enough, and the Government has easier facilities for access to its monetary requirements. However, the terms now offered make the proposition much more inviting than anything of a similar character undertaken in the past.”