XN000022-1986-06-04 — Page 2

WEDNESDAY, JUNE 4, 1986

STEPS TAKEN TO FURTHER DE-CONTROL RENTS

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THE PROPOSALS IN THE LANDLORD AND TENANT (CONSOLIDATION) (AMENDMENT) BILL 1986 ARE STEPS TOWARDS GOVERNMENT'S AIM OF DE-CONTROLLING RENTS, THAT IS TOWARDS A SYSTEM IN WHICH THEY WILL BE RETURNED TO A FREE DOMESTIC RENTAL MARKET, IN WHICH LANDLORDS WILL BE ABLE TO CHARGE A FAIR MARKET RENT AND IN WHICH TENANTS WILL RETAIN A FAIR MEASURE OF SECURITY OF TENURE BASED ON ADEQUATE PROTECTION BY AN INDEPENDENT TRIBUNAL, THE SECRETARY FOR HOUSING, THE HON JOHN TODD, SAID TODAY (WEDNESDAY).

MOVING THE SECOND READING OF THE BILL IN THE LEGISLATIVE COUNCIL, MR TODD SAID GOVERNMENT SET UP A COMMITTEE IN 1980 TO EXAMINE THE POLICIES AND LEGISLATION GOVERNING RENT CONTROL AND THE RELATIONSHIP BETWEEN LANDLORDS AND TENANTS.

THE COMMITTEE FOUND THAT CONTROLLED RENTS FOR PRE-WAR AND POST-WAR PREMISES WERE ONLY ABOUT 20 PER CENT AND 40 PER CENT OF MARKET RENTS RESPECTIVELY.

AS THESE RENT LEVELS WERE UNDULY LOW AND THAT THIS WAS DISCOURAGING INVESTMENT IN HOUSING PRODUCTION AND THE AVAILABILITY OF RENTAL HOUSING IN PARTICULAR, THE COMMITTEE CONCLUDED THAT AS SOON AS CIRCUMSTANCES PERMITTED, EVERY EFFORT CONSISTENT WITH THE NEED TO AVOID ADVERSE SOCIAL AND ECONOMIC CONSEQUENCES SHOULD BE MADE TO ACCELERATE THE PHASING OUT OF RENT CONTROL.

MR TODD SAID THAT GOVERNMENT ADOPTED THIS AS ITS LONG-TERM POLICY.

ZAMENTOF

HE ALSO SAID THAT AS AMENDING LEGISLATION HAD BEEN PASSED BY THE LEGISLATIVE COUNCIL EACH YEAR SINCE 1983 DESIGNED TO RAISE PROGRESSIVELY THE CONTROLLED RENTS OF PRE-WAR AND POST-WAR PREMISES, BRINGING THEM CLOSER TO MARKET LEVELS AND EVENTUAL DE-CONTRÓL, THE TWO MAIN PROPOSALS IN THE BILL WERE SIMPLY FURTHER STEPS IN GOVERNMENT'S LONG-TERM OBJECTIVE.

GIVEN GOVERNMENT'S OBJECTIVES AND THE NEED TO TAKE INTO ACCOUNT ECONOMIC AND SOCIAL CONSEQUENCES, MR TODD RAISED THREE POINTS WHY THE SITUATION WAS SUCH THAT FURTHER STEPS COULD NOW BE TAKEN SAFELY.

FIRSTLY, HE NOTED THAT THE AVERAGE CONTROLLED RENTAL LEVELS WERE STILL SIGNIFICANTLY BELOW MARKET RENTS WITH PRE-WAR PREMISES BEING AT ABOUT 55 PER CENT AND POST-WAR PREMISES AT ABOUT 68 PER CENT OF PREVAILING MARKET RENTS.

SECONDLY, ON WHETHER THE PROPERTY MARKET WAS SUFFICIENTLY STABLE TO JUSTIFY FURTHER STEPS TOWARDS DE-CONTROL, HE SAID THAT SINCE 1983 WHEN THE FIRST STEPS TOWARDS FURTHER DE-CONTROL WERE TAKEN, RENTS AND PROPERTY PRICES HAD REMAINED GENERALLY STABLE.

/IN 1985