Page 364 - Week 02 - Wednesday, 2 March 1994

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MR CORNWELL (10.35): Madam Speaker, I present the Landlord and Tenant (Amendment) Bill 1994.

Title read by Clerk.


That this Bill be agreed to in principle.

I am sorry that the Minister for Housing is not present; but he will no doubt read my comments. Madam Speaker, at present the ACT Housing Trust provides a loan of up to $600 to eligible applicants to help them pay rental bonds to landlords in the private sector. It is a rather cumbersome, longwinded arrangement. The Housing Trust pays the money to the tenant; the tenant then pays the money to the landlord; and the landlord is now obliged by law to pay that money to the Rental Bonds Office, where it sits until the tenant vacates, when the whole business is reversed and we start going backwards. This strikes me as being rather cumbersome.

However, there are other problems associated with this procedure. After six months the Housing Trust requires the tenant to repay this loan by instalments over the next 12 months, so in fact the tenant has the use of the loan for something like 18 months. My proposal is that the money that the Housing Trust pays as a bond to eligible tenants in private rental accommodation should in fact be paid direct from the Housing Trust to the Rental Bonds Office. In other words, it should bypass the tenant.

I cannot see why we have to go through this very cumbersome and, as I will prove, inefficient procedure. The problem with the current practice is that, apart from the cost of administering this rather cumbersome scheme, some tenants either do not repay the bonds to the trust or, when the Rental Bonds Office gives them the money back upon their vacating the premises, they simply take the money and run. If members want evidence of this, I refer them to a letter from the Minister, Mr Connolly, on 21 June 1993 which states:

Loan money advanced in the 1991-92 financial year was $277,729. Loan money repaid to the end of April 1993 amounted to $38,864.

This clearly demonstrates, Madam Speaker, that - in spite of a requirement, even then, that tenants had to start repaying their money after 12 months - it is very obvious that most of the $277,729 should have been repaid by the April 1993 deadline; unless we are to assume that most of that $277,729 was in fact handed out in loans of up to $600 in the last two months of 1991-92, namely, May and June. I simply do not accept that that is the case. Therefore, the Housing Trust - and by the Housing Trust I mean the ratepayers and the taxpayers of the ACT - is out of pocket by some $239,000 for loans handed out in 1991-92 alone.

In that year, if each loan was worth the maximum of $600, 462 loans were given out and only 64 of those were paid back - a 13 per cent return. I do not think that is very efficient, and I do not think it is in the best interests of the people of the ACT. I put it to you that if this amendment of mine is accepted we will find that we can avoid involving the tenant at all. The money will simply pass from the ACT Housing Trust to the Rental Bonds Office. If subsequently a tenant vacates

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