House of Representatives
2 May 1947

18th Parliament · 1st Session

Mr. Speaker (Hon. J. S. Rosevear) took the chair at 10.80 a.m.. and read prayers.

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– Recently, I asked the Minister for Commerce and Agriculture whether the Government of Western

Australia bad applied to the Commonwealth Government for relief to wheat mid harley growers who had suffered loss through floods, and he replied that it had not. I have here a copy of a letter- from Mr. Tonkin, the former Minister for Agriculture in Western Australia, stating that representations were .made, ‘but that r,tie Commonwealth had taken the stand that it would grant relief only when damage could be regarded as widespread and 11, tiona 1. As this statement is at variance with the reply given by the Minister for Commerce and Agriculture, [ ask him to investigate the position further.

Minister for Commerce and Agriculture · BALLAARAT, VICTORIA · ALP

– It would appear that there is some misunderstanding over this matter which I shall try to clear up. It may be that some verbal representations were made bv Mr. Tonkin on behalf of the Government of Western Australia, hut that nothing was committed in writing.

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Essen don Aerodrome.


– Will the Minister acting for the Minister for Air say when compensation will be paid to those whose land was acquired recently for extensions to the Essendon Aerodrome? As this area adjoins my electorate, several persons whom I represent ai-e anxious about their position.

Minister for Repatriation · BASS, TASMANIA · ALP

– I cannot give the information offhand, but I shall have inquiries made in order to find out what progress has been made. regarding the settlement of compensation claims, and to expedite proceedings if necessary.

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– I have not seen the charges alleged to have been made by the Associated Chambers of Commerce. The control of capital issues is regarded by both Commonwealth and State Governments as being necessary in certain circumstances. My own view is that such control is necessary at all times, both in war and in peace. The control of capital issues was inaugurated by a previous Government, in which the honorable member for Warringah was Treasurer. The organization has continued since then under successive governments, and has done splendid work in the proper utilization of the finances of the country and in protecting the public from proposals aimed at benefiting promoters to the possible detriment of would-be investors. In response to the request of the honorable member I shall have a statement prepared setting out the position, but I emphasize that my personal view is that some form of control of capital issues is necessary at all times.

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Coal - Membership ok Trade Unions.


– Can the AttorneyGeneral say whether it is a fact that the Amalgamated Engineering Union has appealed to the court for an injunction in respect of a decision given by Mr. Gallagher of the Joint Coal Board in connexion with a dispute at the Abermain coal mine as to the union of which an employee of the colliery should be a mem ber? Is he also aware that that colliery has been idle since the 31st March last, and that the trouble is likely to extend to other collieries? If so, will he endeavour to have the hearing of the case expedited ?

Attorney-General · BARTON, NEW SOUTH WALES · ALP

– I was not aware of the actual stoppage to which the honorable member has referred, but I can inform him that the case was brought before the court a few days ago and that judgment has been reserved.

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Right to Make Personal Explanation


-! direct a question to you, Mr. Speaker, in relation to the rights and privileges of honorable members and the procedure which they are expected to follow. At a .late hour last night, during the course of a debate on industrial aif airs, the Minister for Postwar Reconstruction- made certain, statements which I considered completely misrepresented mc. In accordance with the. Standing Orders and the custom of the House I rose immediately the Minister had resumed his seat and asked to be permitted to make a personal explanation. The Acting Deputy Speaker, the honorable member for Perth, was in the chair at the time. Other members who claimed that they, too, had been misrepresented, rose and in turn they received the call. “When they had made their personal explanations I again rose, as I had continued to do, and asked permission to make a personal explanation. By that time you, sir, had resumed the chair. You peremptorily ordered me to resume my seat and called upon the honorable member for Moreton to continue the general debate. I was compelled to resume my seat, but I admit that I counted ten before I walked out of the chamber.

Mr SPEAKER (Hon J S Rosevear:

– Order ! That is a reflection on the Chair.’


– I withdraw any remark which may be construed as a reflection on the Chair. I endeavoured to adhere to the custom and procedure of the House to the letter, but I was denied the opportunity to make a personal explanation.


– The honorable gentleman is making a speech. What does he wish to know about the Standing Orders?


– I desire to know what procedure a member must adopt in order to have his case heard under the Standing Orders.


– The position is quite clear under the Standing Orders. There are two standing- orders ‘covering the matter of a personal explanation. If an honorable member has taken part in a- debate, and something- that he said hasbeen misrepresented, he has the right to> make a personal explanation at the proper time. If an honorable member has not taken part in a debate but has been referred- to by another honorable member, he may make a personal explanation only with the indulgence of the House, and assent must be unanimous. If any honorable member dissents he may not make the explanation. The next qualification is that an honorable member may not in any circumstances make an explanation while another honorablemember has the floor. The honorable member for Moreton had been- called and had a right to proceed with his speech.


– Last night’s incident referred to by the honorable member for Richmond took place while I had the honour to act as your deputy, Mr. Speaker. The honorable member certainly rose but, although my hearing is very keen, I did not hear him ask for leave to make a personal explanation. He was one of a number of honorable members who rose, but I am perfectly convinced that he made no request for’ leave to make a personal explanation.

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Cane-cutting Knives.


– The sugar industry in Queensland, which is vital to the development of the north, has recently experienced great disabilities owing to a severe drought followed by floods, and is embarrassed because of the shortage of supplies of certain equipment. Its difficulties have been greatly intensified by the shortage of canecutting knives. Will the Minister representing the Minister for Trade and Customs make a special effort, even if he has to approach the Government of Victoria, to obtain these articles which are’ so necessary for the development of the sugar industry? As the need is urgent, I. ask the honorable gentleman to make every possible endeavour to obtain supplies at once.


– I shall endeavour to ascertain if there are ways and means by which this essential need of a most important section of the Queensland producers can be obtained.

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– Has the attention of the Minister for Commerce and Agriculture been drawn to the statement of the chairman of the Queensland Meat Industry Board, Mr. S 111111 e r s, that Commonwealth plans to step up meat supplies for Britain, announced by the honorable gentleman, will not result in additional cattle being killed in Queensland? Is it not a fact that, with the beginning of the export season, Queensland abattoirs will, in. any case, foe killing to full capacity in order to meet the normal demands of the trade? In view of Mr. Sunner’s statement, has the Minister taken any action to revise his plans as far as they relate to Queensland, or has he in mind any proposal which would enable the’ people of that State to give effect to their unanimous wish to provide additional food for Britain?


– I have not seen the report to which the honorable member refers. Regardless of whatever views Mr. Sunners may hold, I have not the slightest doubt that the Queensland producers will give the wholehearted co-operation sought in this matter by the Government and the people of this country.

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– I ask the Minister representing the Minister for Supply and Shipping whether consideration has yet been given to the request of King I’sland residents, which was embodied in a resolution passed at a public meeting on the 24th March, that Tanbar be altered so that inflammable liquids may be carried between decks, as was possible before the vessel was taken over for war purposes; and further that Tanbar he diverted to the King Island trade on- the same basis as before the war?

Minister for Defence · CORIO, VICTORIA · ALP

– I believe that the matter raised by the honorable member is one about which the Minister for Supply and Shipping gave me information yesterday when he told me that advice had already been posted to the honorable member. If it is the same matter I shall ascertain whether the information sought has been posted to the honorable member. If it is not the same matter, I shall give consideration to the honorable member’s requests.

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– Has the Prime Minister read a report in to-day’s Sydney Morning Herald that high army officers have stated that Australia’s army had declined so rapidly since the end of the war that a fighting force could not be called on in an emergency? Is it a fact that, counting every man in uniform, the army could not muster more than 35,000 men, including about 10,000 in the Australian occupation forces in Japan, and 11,000 recruits for the interim army ? As the Government has talked so much about its interests in the future security of Australia, and in view of the unsettled state of the world, will the Prime Minister inform the House how much longer this country must tolerate the Government’s “ wait and see “ policy, or shall we be given some definite outline of policy before the end of the present session?


– I have not seen the article to which the honorable member has referred. I heard some slight reference to the matter over the air, and I believe that that would be the same matter which the honorable member has mentioned. The broadcast report concluded with the statement that the Government had demobilized the forces too rapidly; and I thought that was one of the things which had been sought by primary producers and particularly by members of the Australian Country party in this chamber. I shall look into the matter further and supply an answer to the honorable member.

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– Some time ago I asked the Minister ‘in charge of the Council for Scientific and Industrial Research if he would request the council to investigate the possibility of growing rubber in Australia, and he promised that he would do so. Has he yet placed that request before the council, or received any reply as to the prospects of growing rubber in Australia ?


– I passed an the honorable member’s request to the Council for Scientific and Industrial Research. During the war period the council made very considerable investigations into this matter; but in view of the new conditions arising since the war and the improvement of resources for scientific purposes during the war, the Co.Uncil will now be able to make a more complete investigation than would have been possible during the war. I have not yet received advice from the council as to what it proposes to do in the matter. T shall again take up the subject, and obtain a reply for the honorable member.

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Trans- Australia Airlines - C aessy Aerodrome.


– In the absence abroad of the Minister for Civil Aviation, [ ask the Minister for Repatriation who is acting for him whether it is a fact that Trans-Australia Airlines is reducing the number of its maintenance staff at certain main terminals, including Cambridge? Are any of the dismissed men ex-servicemen? Were they working under a guarantee of permanent employment at the time of their dismissal?


– At present, TransAustralia Airlines is making some reorganization of its staffs, and the staff at Cambridge may be involved. However, T shall obtain the information sought by the honorable member and advise him in due course.


– Will the Prime Minister reconsider the proposal to dismantle the buildings at the Cressy aerodrome for removal and re-erection at Mr Martha. Local bodies have tried to buy them. They could be shifted to sites in the locality without being dismantled. The present proposal is that they be dismantled and, notwithstanding transport difficulties, transported 140 miles to Mr Martha. The proposal involves great difficulty and expense that could be avoided by acceptance of the local offers.


– I do not know whether the honorable member is fully aware of the work being done at Mr Martha. Valuable social amenities have been provided there for Commonwealth reconstruction trainees. The need exists to expand the work. T am not. able to say anything about particular buildings or applications that may have been made for them by the people of Cressy. I will have the matter re-examined, keeping in mind always the need to enlarge the splendid work at Mr Martha and to provide suitable accommodation.

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– I understand that the Government proposes to install a new air-conditioning system in Parliament House. I ask you, Mr. Speaker, whether, since we nowadays sit a lot in the daytime, it is not possible to light this chamber naturally, instead of by electric light.

Mr SPEAKER (Hon J S Rosevear:

– A few days ago the honorable member for Wilmot asked a question, relating to the installation of an auxiliary lighting system for this building for use in the event of a power failure. The Chief Engineer has now advised me that a complete auxiliary lighting system would be very expensive, the cost running into thousands of pounds. He is of the opinion, however, that a limited emergency system, providing a light at about twenty points in the building, could be installed for approximately £200.

The question of the efficacy of the present lighting system in Parliament House has already- been considered, so far as the Library is concerned, and it is- proposed to extend investigations to other rooms in the building. A test will also be made in this chamber. I do not know just how soon the work will be undertaken, but the honorable member may rest assured that the House Committee has the .matter well in hand.

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– Will the Minister for Repatriation inform honorable -members of what is taking place in regard to the Caulfield Repatriation Hospital? I have been informed that 50 per cent, of the patients have been transferred to another hospital. The staff at Caulfield, both male and female, is almost 100 per cent, exservice personnel, and most members of it live in the vicinity of the institution. They have not been told of what the Repatriation Department proposes to do in regard to the hospital, and they are vitally concerned about housing in the event -of a transfer to another area. Does the Minister not think it right that he should make a. statement of his department’s proposals?


– Replying first to the concluding portion, of the honorable member’s question, I do not regard myself as under an obligation to make a statement to the House in relation to any reorganization that .may he taking place within the department. In regard to the general question of the future of Caulfield hospital, the Department of Repatriation is taking over the Heidelberg Military Hospital, which it is believed will ultimately be sufficent to house all repatriation and service patients. It -is probable that for the next couple of years, however,, it will not ‘be possible to house nil these patients at Heidelberg. The future of the Caulfield Repatriation hospital is now under consideration, and as soon as a decision is reached those people who are associated with that institution will be advised.

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– As the Lake Macquarie district will shortly be celebrating’ its 150th anniversary, will the Prime Minister consider making available the German V2 rocket bomb which has been displayed in support of the recent, loan campaign, to assist the appeal that is being made for funds to build the Lake Macquarie Soldiers’ Convalescent Home which will he erected without cost to the Repatriation Department ?


– My first reaction is to say that the honorable member’s request cannot be granted, because large, numbers of similar requests would be received, and the cost of transporting the German V2 rocket bomb from place to place would be considerable. The Minister for the Army, in response to my request that the bomb should be made available for demonstration purposes during the recent loan campaign, agreed, to provide transport and guards who would accompany the bomb from town to town. The intention is to accommodate the weapon at the Australian War Museum in Canberra. At the moment, I am not disposed to agree to an extension of the demonstration of the bomb, but I shall examine the honorable member’s request.

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– I desire to ask the Minister for Commerce and Agriculture a question relating to the continued selling of stock at the Newmarket sale-yards in Victoria above the ceiling price. About six weeks ago, the honorable gentleman reported that he had made arrangements for weight and grade basis of killing in Victoria with a view to overcoming the marketing difficulties. Later, he stated in this House that the scheme was functioning satisfactorily. Will he now inform me how many trucks of. sheep and cattle have been slaughtered under this scheme in Victoria?


– It is quite true that the Government did make provision in Victoria for the slaughtering of stock on a weight and grade basis for primary producers who desired to accept ‘those facilities. . The reason for advertising and bringing these facilities to the notice of producers was that some of them were discontented with the condition of affairs existing at the Newmarket sale-yards. Some producers, probably with justification, considered that they were not likely to receive the actual value of their stock. The provision of these alternative facilities in Melbourne offered to them a means; for obtaining the actual value of their stock, less the handling and treatment charges. The system has been an undoubted success. Following the announcement of its introduction, those responsible for the five weeks’ hold-up “ folded up “ because of the fear of the complete acceptance by stock producers of that system of weight and grade killing. The result was that the difficult period was overcome, and normal conditions were restored. In that sense, the institution of the weight and grade arrangement wa? a complete success.

Mr Turnbull:

– How many trucks of sheep and cattle were slaughtered under this scheme in Victoria?


– The number of stock which was handled under the weight and grade system is completely irrelevant. The scheme was introduced for the purpose of ending a hold-up of meat supplies in Melbourne, and it had the desired effect. If in future any nefarious practices are resorted to in the Melbourne yards in respect of the selling of stock this Government will make further endeavours to accelerate the killing of stock on the weight and grade basis.

Mr Turnbull:

– The stock is still being sold at more than the ceiling price.


– The honorable member’s allegationsmay be true. After all, the law lays down a ceiling price for dead meat in carcass form, not on the hoof. Therefore, at the point of purchase in the Melbourne markets there is not necessarily any breach of the law. Breaches of the law can take place only when the meat is sold in carcass form. Following an intensification of the policing of prices, the danger of the law being broken is less than it otherwise would be.

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Volume of Production


– Can the Minister for Post-war Reconstruction inform the House of the total value of primary production in 1940-41 and the total value of secondary production in the same period? Can. he also supply the same information for the year 1945-46?


– According to the Commonwealth Statistician, the total value of primary production in 1940-41 was £84,000,000! By 1945-46 the total value of such production had risen to £126,000,000, an increase of £42,000,000 representing 50 per cent. The total value of production in secondary industries in 1940-41 was £115,000,000. By 1945-46 the total value of such production had risen to £153,000,000, an increase of £38,000,000 representing 33 per cent. It is to be noted that these increases, totalling £80,000,000, took placewhen a Labour government was in office.

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American Import Charges


– Has the Government yet received any definite information concerning projected legislation by the Congress of the United States of America to impose high duties on wool imported into America? If such legislation should be passed, what effect will it have on the trade negotiations at Geneva, and what willbe Australia’s attitude on the subject?


– The Government is fully informed of all that is being done with regard to legislation in the United States of America affecting wool. I do not consider that at present I shouldgo into all the possible implications of such legislation should it be passed. It certainly has not become law yet. All matters relating to such legislation have been given full consideration by the Cabinet sub-committee that is watching and dealing with the trade negotiations at Geneva. I am not in a. position to make any further statement to the honorable member at present.

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– I wish, to make a personal explanation. About three weeks ago, during a speech by the honorable member for Martin, I interjected to the effect that Judge Foster had changed his name by deed poll.. I believed that to be so at the time. I -have since received information which has proved that it was not correct. As my interjection was recorded in Hansard, I wish, in fairness to Judge Foster, to record that it was not correct.

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Debate resumed from the 25th March, (vide page1117), on motion by Mr. Chifley-

That the following paper be printed: -

Financial Statement by the Right Honorable J. B. Chifley, M.P., Treasurer.

Leader of the Opposition · Kooyong

.- The Prime Minister (Mr. Chifley), in his capacity as Treasurer, presented to the House on the 25th March, a financial statement, in the course of which he foreshadowed the introduction of various taxation measures to give effect to the proposals indicated in the statement. As we shall have an opportunity of discussing these proposals when the individual bills are introduced, I do not wish unduly to take up the time of the House by a general debate now, but there are certain points which arise from the financial statement which can perhaps be better expressed in the course of a general debate than in the discussion of a particular bill. In the course of the statement the Prime Minister reviewed the financial results of the year up to the 25th March last, and that review presents some most interesting features. First, the estimates of revenue are being considerably exceeded, showing that personal incomes in terms of money are rising either individually or in total, and secondly, the expenditure on works and other capital projects is falling short of the estimates for reasons to which he referred in the statement-.

I should like to say something about excess, of revenue over the estimates, because it is quite remarkable - perhaps, more remarkable to the Government than to the Opposition, because honorable members will recall that during the recent general election, Opposition members stated freely that there would be great buoyancy of revenue and that therefore a bold and prompt measure of taxation reduction should be adopted. I do not want unduly to resuscitate the disputes of the past, hut it will be recalled that very harsh names were applied to us when we said that with the inevitable prospect of buoyant revenue the, time had come for a reduction of taxes and that the reduction should be of the greatest possible extent. In other words, we resolved the doubts in favour of tax reduction, and not against it. However, the people were persuaded then that we were wrong and that it could not be done. Now they have been told by the Prime Minister in clear terms that it can be done and that he proposes to do it, and I have no doubt that the Government will claim great’ credit for doing so.

Mr Lazzarini:

– This is nothing more than tedious repetition.


-I welcome the honorable member for Werriwa to the debate because he is the greatest expert on tedious repetition that this House has ever known. I said that the experts’ estimates of the revenue have been greatly exceeded; now it is clear that customs receipts alone will exceed by about £10,000,000 the estimates made. Customs and excise receipts for the last two periods are set out together in the monthly statements issued, and we find that as compared with the previous year these revenues are rocketing. For example, in the statement just released the comparison of the customs revenue for April, 1946, and April, 1947, shows that there has been an increase of £1,800,000, and that if the period of ten months ended the 30th April, 1946, is compared with the same period in 1947, customs revenue has risen from £62,866,000 to £84,224,000, an increase of almost £22,000,000. That represents an enormous increase over both the estimate for this year and the receipts in the past year. The figures show that sales tax receipts are up, or will be up by the end of the financial year, by £4,000,000 or £5,000,000 over and above the estimate. But perhaps the most significant figure is in regard to income tax. We have repeated over and over again to the Government that with more and more people coming back into production in the last year or two, and with the steady upward pressure on prices, the national income in terms of money was bound to rise. Therefore income tax receipts would rise, and could survive a substantial reduction of rates and still produce a. similar total. The Treasurer estimated that the two income tax cuts which had been made up to that time would cost the Government £37,000,000 in a full year. However, the financial statement just delivered to us shows that the fall in actual collections of income fax for the nine months under review was only £2,000,000. During the corresponding nine months of the previous year, the Government collected £12.4,00.0,000 in income tax, while the collections for the first nine months of this year amounted to £122,000,000. If the Government had realized as quickly as many of us did how feasible substantial tax cuts were, a great deal of community irritation would have been prevented.

Probably, a’ great, deal of industrial irritation would have been prevented also because the cuts would have been much more substantial and would have been made sooner.

In saying .this, I may be cutting across the philosophic basis of the Government’s approach to the matter. When the Government finds that conditions are buoyant, and they unquestionably are buoyant in terms of revenue, it has to choose between two courses: one is to give back to the people the money which the Government does not need - the excess money which it has collected. The other is to say, “ Oh no, we can spend the money much better than can the people. * We will look around for some fresh avenue of expenditure”. Unfortunately, the tendency of the Government has been to follow the second course, and to look for new* avenues of expendiutre, while only very reluctantly, a.nd under great’ pressure, ‘following the obvious course of handing back to the people, from has been collected, the excess revenue.

The second feature to which I draw attention is that the estimates of expenditure for works and other public purposes will not be realized. The Prime Minister said that the lag in spending on new civil works was mainly because of shortages of labour and material. That lag is very substantial. I do not want to hurden my remarks with figures, but 1 wish to make this point: although the budget estimate of expenditure for the year on loan works was £58,529,000, the actual expenditure was only £11,846,000 by the end of March. Thus, the Government has so far failed to expend even a substantial proportion of the estimated amount on loan works. The reason for failing to do, so is the shortage of men and of materials. I dwell on the word “materials”, because the shortage of materials is at the back of all production delays in Australia, and particularly in the carrying out of housing programmes.

Add these together - rising incomes in terms of money, and failing, or rather, insufficiently rising, supplies of materials, and we must come to the conclusion, economically speaking, that two things are happening: Incomes in terms of money are rising, and incomes in terms of goods and services are lagging. There is the classical state of affairs in which we may expect to find deflation of the currency, inflation, rising prices - whichever term we may adopt to express exactly the same phenonomen. After all it is only in the volume of goods and services that we can find any expression of a real standard of living. .1 wish to reiterate that checks on inflation include, not only price control and wage control, but most important of all, increased production, and it is the most important because it is the most dynamic of all. It is the most active opponent of inflation. The others are only palliatives, the. effect of which .may he merely to conceal inflation. The positive attack on inflation is by the weapon of increased production. We need very badly in Australia a new approach to these matters.

Who produces - the citizen or the government department, the citizen or the official, the taxpayer or the man who collects the tax? There can be no doubt cf the answer. The producer is’ not the man in government; he is’ the man upon whom government is operating. How can we help that citizen to produce? That ought to he our first, question the moment we realize that he is the producer. We should ask ourselves how oan we help him to produce, not what burden can we put on, him, not how we can hamper him, or by what rules and regulations we can surround him. What is the smallest burden that we can ask him to carry, provided that adequate social services are carried on in the community, and provided, in the result, that he will be enabled, as far as possible, to stand on his own feet, and so reduce the burden of government, and reduce the demands made on government; If we were looking on this as a ‘fresh problem, and were really concerned in establishing the country on sound lines, those are the questions we would be putting. How can we help the individual to develop and expand production? Instead pf that, our policy of late seems to be based on the idea that the individual is of small importance; that the activity of the government is all. important; that the ideal state is one in which-the citizen becomes more and more dependent on the government, and adopts more and more the attitude that all problems can be solved by the government. That kind of thing produces a degree of dependency in the individual citizen which is quite inconsistent with a powerful nation and a virile race. I have turned aside to that matter because I believe that nobody, looking at the development and progress of events in Australia, particularly in the last twelve months, can fail to observe that we are becoming very rapidly an ordered-about, frustrated, and to a deplorable degree, dependent people.

I shall say no more about increased production. I now turn to two other elements to which reference has been made, namely, prices control and wage pegging. These are two matters which were originally conceived as instruments for the avoidance, or the suppression, of inflation. I shall take prices control first. If prices control exists, side by side with an extensive black market as I regret to say it does exist more and more in Australia, and if its effects are concealed, as they are already concealed to a great degree by government subsidies, we may reach the stage where it cuts down the basic wage, or the wages of the community in terms of the cost of living, but in reality produces inadequacy of wages and real inflation. After all, although devices may be employed, such as subsidies against certain key products, to keep down the costs of those commodities which pass into the index figure of the cost of living, at the same time the true cost of living, which embraces items which go far beyond those which affect the- index figure, may be very much higher than the index figure would suggest. That is true. The inevitable result of it is that there is a growing dissatisfaction on the part of the wage earner with the wages that he receives. If prices control were effectively administered - if the system of control were directed to maintaining a true purchasing power over the widest possible range of goods, and if black marketing were ruthlessly exterminated - prices control would continue to be an effective instrument in ^reserving economic stability. But, I believe that more and more there are aspects of prices control which produce irritation, encourage underproduction, and therefore increase rather than diminish the risk of inflation.

T made reference recently, as did also the honorable member for Richmond (Mr. Anthony), to a striking case in order to illustrate how far prices control is wandering from its true function. It was i case which ultimately reached the High Court - the case of Miss.Daveney Proprietary Limited. I propose to make a further reference to it, not because it is sn individual case, but because it is one case out of hundreds. It illustrates an aspect of this matter, a course of conduct which- is becoming increasingly characteristic of prices control. This company was engaged in the manufacture of confectionery and was in the wholesale business. The control of its prices was <i. control of the prices that it should charge retailers, -whose prices to the public I have no doubt also were controlled. The company established its business before the war. During the whole period of the war the prices charged by it remained .constant. In other words, the prices charged by the company at the time of the proceedings were exactly the same as the prices charged by it in July, 1939. If I may put it to the House as the original founder of prices control in the course of the war, my own impression always was that the prime, immediate, object of prices control was to prevent prices from rising unduly under the pressure of war. I do not think that, at that time, any one supposed that the object was to give to officials the power to order around those who conduct businesses, even though their prices remained constant. Yet this company, which produced goods, and sold them at exactly the same -prices right throughout the period of the war, was visited by an officer of the Prices Branch who in due course said something like this, “ We have been looking into your figures and we see that this is an expanding business. You have increased, your turnover considerably, and because of that you have increased your profits. Consequently, I now have to tell you that one of two things must happen : Either you must accept a reduction of your prices - that is to say, you must charge prices lower than those allowed to your less efficient competitors and less than you charged in July, 1939- nor you must reduce your turnover, perhaps by putting off some of your hands, and so reducing the volume of your business, so that the same prices or profits will once more resume their right relations to thebusiness.”

Mr Hamilton:

– That is a clear penalty on efficiency.


– Yes. This happening, if told in some civilizedplanet, would move the people there to mirth, to think that such an absurdity could be perpetrated. Yet so little do the Prices Branch authorities regard it as absurd that they actually fought the case to the High Court. The Prices Commissioner had the good fortune to get through in the High Court by a majority of three, including the Chief Justice, to three not including the Chief Justice, which was nearly a defeat. Three of the justices of the High Court said plainly that what had occurred was not prices control at all, but a misuse of the power to control prices. I shall make a few comments on that case. The first is that it is the policy of those who administer pricescontrol, to say in the guise of controlling prices, that they will determine what profit a business shall earn. That is a usurpation of the functions of taxation. If there are profits to be taxed, let us tax them by the taxation law; but do not let us go around pretending to control prices but actually use the power to impose upon a man who conducts a business, a special tax in the form of an order by the Prices Commissioner, over and above the taxes that he already pays. My second comment is, that this is a tremendous penalty upon efficiency. This question, mark you, does not arise with a big and wellestablished business, the big business which operated before the war and has developed its own chronic shape and pattern. It has its capital, which is large, and a substantial annual rate of profit. It is not going to run into difficulties of this kind which” will be encountered by small businesses; it has committed the unpardonable sin of growing. The thing that staggers me so frequently is that too much of government policy is directed to protecting the man who has already succeeded and handicapping the man who is exercising the legitimate ambition of trying to succeed. Why not encourage the small man to become big, and small businesses to grow?

Mr Williams:

– Was the case brought before the court under the earlier regulations or thosebrought down by the present Government?


– It was brought under the Prices Control Regulations as altered from time to time. The case was decided at the end of 1945 or later. At all events, it was a recent case. My third comment - and it is involved in what I have already said - is that this kind of thing hits the small man. Let us not imagine that because an honorable member talks in this Parliament about profits he is defending some huge profiteer. The huge profiteer looks after himself; he is on the black market; he is evading income tax and engaging in all sorts of frauds. It is the profit made by a small business which enables that business to grow and provide more employment. In the case I am now discussing the grim observation made by the official was: “ Look ! Your right course is to reduce your turnover. If you do that I shall not have to make an alteration of your prices “.

Dame Enid Lyons:

– Was that actually the case?


– Yes ; none of the matters I have stated in connexion with this are stated on ex parte foundations. I have no affection for ex parte statements. Every statement I have made is supported by the transcript of the proceedings in the High Court of Australia and by the evidence tendered to and the findings made by the magistrate who heard the case in the first instance. The magistrate’s findings were accepted by the High Court as the material upon which its own decision was given. I shall quote the actual words used by the magistrate because it is undesirable that anything I have said may be regarded as in any way contentious. In giving his decision the magistrate said -

The evidence shows that -

The price at which the defendant company should sell goods was fixed by an Order gazetted on the 7th August, 1945, and 31st January, 1946, notice of the selling price being given to the defendant company by letter elated 8th February, 1946:

On the 1st March,1946, the defendant company sold goods the subject of the charge at a greater price than that fixed by the Order of the 8th February, 1946: :>. The price of the goods the subject of the charge were stationary since before the war until the date of the sale alleged in the information;

The gross profit of the defendant company in 1039 was small but had greatly increased by 11)45;

The price of thu subject goods was fixed after correspondence between the defendant company and the Deputy Commissioner, and an interview between an officer of the defendant company and officers of the Prices Branch

An officer of the Prices Branch suggested that profits should be reduced by a reduction of the defendant company’s turnover.

have made three comments; first, that this exercise of power on the part of the Prices Commissioner is a usurpation of the function of taxation; secondly, that it penalizes efficiency; and thirdly, that it hits the small man. My fourth comment is that this kind of thing does not benefit the public anyhow. Here we are dealing with a wholesaler and the Prices Commissioner says, in effect, “ You must get below your 1939 price levels “. He does not say that to the competitor in the next street because that competitor has been relatively inefficient and is still able to show about the same profit as he earned in 1939. Because of that his prices remain untouched.

Mr McBride:

– They may even increase.


– Exactly ; if the competitor in the next street could show that his costs had increased he would, go to the Prices Commissioner and say, “I want authority to increase my prices “. But by the time the goods reached the retailer does anybody suppose that the retailer would sell the output of candy or chocolates of one producer at a lower price than that of the others? Of course not. This benefit does not reach the public. This is the officious kind of conduct you get from “ Jacks in office “ who believe that the existence of government authorities is justified if a few citizens can he pushed around every week. Unfortunately, this is an example of unwarranted interference that does not by any means stand alone.

The other matter to which I want to refer is the question of wage pegging. To-day it is very difficult to believe that wage pegging does more than two things. First, it creates a widespread feeling of irritation, particularly in the industrial world, which may, of course, depend to some degree on misunderstanding of the. wage-pegging regulations; and, secondly, to the. extent that it operates at all it does so to prevent incentive payments in industry. In other words, it tends to convert minimum rates of pay into maximum rates of pay. I cannot imagine anything more damaging to the progress of a nation than to prevent* an extra good man from getting extra good money. But the aspect of the matter I want to touch on is this : We started off with wage pegging in all its pristine beauty a couple of years ago. There was then an agitation about the basic wage and the working week, so the regulations were amended to permit the Arbitration Court to deal with these two matters, notwithstanding wage peg ging. Later on, coming down to more recent times, there was industrial trouble in Victoria which concerned itself with marginal rates. There were strikes, disturbances, lockouts and arguments all around the place, and the Government, as usual, intervened in the direction only of altering wage-pegging regulations to permit marginal payments to be increased in accordance with a certain formula. The changes that the Government had made up to that time were so substantial that one of its Ministers - and a very wellinformed Minister - Senator McKenna, was able to state publicly that 90 per cent, of wage pegging had gone by the board. Notwithstanding that, the agitation against wage pegging continued, and we finally got the hold-up in Victoria which, we were discussing last night. What did the Government do at that stage? It introduced its last regulation, in point of time - not the last as history will record it because the next one will be the one that repeals wage pegging - but this one I touch on because it is the last in point of time.

Mr McBride:

– Fighting a rearguard action.


– That flatters it; it has not been a rearguard action but” a retreat, a stampede, a violent retreat.

Mr White:

– Retreat from Moscow.


– It might be described as that. This last regulation which has been made is Statutory Rule No. 49, 1947, made on the 9th April last, and it transfers the responsibility, of course, for deciding in what matters and at what point wage pegging is to cease to operate to one judge, not to the Arbitration Court sitting as an Arbitration Court, but to one judge, the Chief Judge of the court. He, under this regulation, is to determine in relation to any given matter, in relation to any given industry, when wage pegging is to cease. I do not suppose there was ever in the history of this business such an astonishing transfer of responsibility on a great matter from a government to one individual outside the Government. Just let me support that observation by referring to the terms of the regulation. It says that where the matter of an alteration of a rate of remuneration - that is the widest possible expression - comes before an industrial authority or public employment authority by a plaint, reference or application, and the authority is of opinion that the grounds on which the alteration is sought provide prima facie evidence that an alteration should be made, that authority is to submit, in the case of matters other than coal matters, to the Chief Judge of the court a statement settingout the grounds on which the alteration is sought, the reasons for the opinion of the authority, and the principles by which the authority would be guided in making the alteration. Then the Chief Judge of ‘the court, after considering the statement may, if he is satisfied that it is not opposed to the national interest so to do, make an order authorizing the industrial authority, or public employment authority, to proceed to hear and determine the matter. So, under this regulation, from this time on if somebody comes along and makes a claim for an increase of remuneration, it comes before the appropriate authority, may be, a conciliation commissioner under the new law, or, under the presentlaw, it may be an existing Arbitration Court judge. Then that authority says, “ Very well, before we determine whether we can increase your remuneration to the extent that you are asking, or to the extent that we think wise, we must send the papers to the Chief Judge, and if the Chief Judge says, “I certify . . . “-

Mr Chifley:

– Which, of course, is not quite a correct statement of the procedure.


– Is it not? I have read the words and listeners in the House and elsewhere have heard them.

Mr Chifley:

– Under that formula the authority can make an increase without going to the judge at all.


– In some instances.

Mr Chifley:

– The right honorable gentleman should have explained that.


– I did not think that the right honorable member wished me to explain the obvious. I repeat that, to the extent that increases can be made under the existing regulations, that is to say, as still pegged, of course, the existing authorities can operate; but if a claim is made which goes beyond the pegged levels, if a claim is made which involves, in substance, the unpegging of the wage rate, then the matter goes to the Chief Judge, and the. Chief Judge then decides, technically of course, whether the increase is to be permitted. But in substance, what the Chief Judge is determining is whether wage-pegging is any longer to apply to that industry or to that group of workers. I say that if a government introduces wage-pegging and accepts the responsibility for so doing, if a government changes the limits of wagepegging and accepts the responsibility for so doing, the. government itself ought also accept the responsibility of determining how, when, where and why wage-pegging is to come to an end. But if there is one thing that has stood out a mile in the history of the last twelve months, it is that the Government has ceased to function as the authority in the determination of government policy. It has merely been pushed along from point to point; and each time it has made a pronouncement, the pronouncement has only been made in the course of retreats. If anything is calculated to increase the present discontent about wage-pegging and emphasize the growing futility of some of these devices, it is what I have just been able to lay before the House.


.- The Leader of the Opposition (Mr. Menzies) should he an .authority on rearguard actions and retreats. Despite his great gifts and talents he has made retreats which will mystify historians of the Government which -he led. His record in that respect is the marvel of politics in this country in recent times. The right honorable gentleman commenced by pointing to the fact that at the recent general elections, the party which he led and the Australian Country party, which is associated with him, were called hard names because they had stated that it was possible to make considerable reductions of taxes and that such reductions should be promptly made. That is merely half the story. What the right honorable gentleman said at the last general elections was that his party would not only make substantial reductions of income tax but also incur very heavy additional financial responsibilities. The answer of ministerial supporters to the Opposition proposal was that in order to carry it out the Opposition parties either nui3t fail to honour their promise of tax reductions involving such heavy financial commitments, or readjust the method of payment for Government services by instituting a contributory social service scheme which would undoubtedly shift the incidence of income tax on to the lower ranges of incomes. I repeated that answer to the proposal of the Opposition parties at every opportunity. Perhaps, I was unduly generous to “the Leader of the Opposition, because I told my hearers repeatedly that I did not believe that he, with his knowledge of the Government’s finances, would commit himself to such promises and undertakings which would involve a reduction of actual government income and, at the same time, very heavy additional expenditure, unless he had been pushed into making such promises by the more clamorous element in the Opposition coalition. On the hustings and in this House the Opposition parties have undertaken to abolish the means test, endow the first child and incur heavy additional commitments in increased returns to wheat and wool growers. We asked them during the election campaign, as we .ask now, how they proposed to finance all those additional commitments and’, at the same time, reduce taxes by the percentage proposed. Our view is that when honorable members opposite referred to the benefits accruing from tax reduction, they referred only to the income tax and not to the social services contribution. That would mean that none of the benefits accruing from tax reduction, would be derived by people with family responsibilities on small or middle incomes. The Opposition has repeatedly stated its belief in contributory social service schemes. When the honorable member for Darwin (Dame Enid Lyons) entered this Parliament she said -

In such a scheme, I believe, the,:e should be pensions for all; there should be no means test; those who have should contribute according to their means. But everyone, however little he or she earns, should contribute something, be it only a. threepenny stamp, as a sort of token payment for the advantage of Australian citizenship.

That statement appears to represent the view of -Opposition members. They subscribe to contributions for social security and their advocacy of tax reduction is confined to the income tax. If that is so, they are entitled to their beliefs.

A large body of opinion in former years held the view that the incentive of high incomes and large profits benefited the whole community. The view was that that encouraged enterprise and thus provided employment. Few subscribe to that view to-day. Economists agree ‘ that spreading income downwards by taxation makes effective a latent demand, and thereby stimulates production. That great economist, the late Lord Keynes, expressed that view when he said -

The seeds of depression are sown in the preceding boom, when the rich out of rising incomes’ attempt to save more than in the existing circumstances investment can be found for.

That expresses the present situation, I believe. When Opposition members claim that a reduction of income tax would cure all our economic ills and industrial disturbances, they ought to define their attitude clearly and say whether they contemplate reduction of social service contributions or whether their contemplation is confined to income tax, as I believe it is. The Treasurer (Mr. Chifley) has presented to the House tables that show that a single man without dependants pays only social service contributions until his income reaches £250 a year. A man with a dependent wife does not pay income tax until his income is £400 a year. A man with a dependent wife and three children does not pay income tax until his income is £600 a. year. So, if the ‘ social service contribution is excluded from the tax reduction scheme proposed by honorable gentleman opposite, by far the greatest burden will be left on the middle and lower income-earning groups with the heaviest family responsibilities, and the greatest benefit will be given to those with the biggest incomes and the lightest family responsibilities. The people are entitled to know exactly where the Opposition stands on that matter.

The Leader of the Opposition (Mr. Menzies) said that sales tax collections, were up by millions of pounds. He said that that proved that the Government has not lost by reducing the sales tax last financial year, but I regard that as an example of bad or dishonest analysis, because, had the rates of sales tax remained unaltered, the revenue would have been correspondingly higher.

The right honorable gentleman also said that production was an active agent against inflation. That ,is true, but not wholly true. During the war an inflationary tendency arose because although production was high it was not available for consumption in Australia; it was exported or used by the armed forces. Although it is true that production consumed in Australia is an active agent against inflation, when the surplus is sent overseas and cannot be paid for in goods and services because of limited production overseas, that surplus is an active agent in the other direction. The right honorable gentleman’s general argument is correct, but when production is exported to feed the starving millions throughout the world, the fear exists of inflation or at least a rise of prices, sharply or gradually. Australia’s economy is still thus affected, and people earning more money than they can legitimately buy goods and services with, pay high prices on the black market for those goods and services or buy luxuries. Price fixing and rationing are as necessary now as they were during the war.

The right honorable gentleman made some other general observations about frustration, people being ordered about, the Government being all important and citizens being of no value at all. That is loose talk. The Government has lifted restrictions, sometimes before it has been desirable to do so. 1 instance the lifting of the restrictions on railway travel. The right honorable gentleman dealt also with prices control. No one suggests that the prices control system that has operated in this country has been completely scientific. In many instances it has been merely an arbitrary assessment, in an endeavour to prevent the worst effects of inflationary tendencies. However, housewives throughout Australia, as the honorable member for Darwin will agree, have welcomed price fixation because of the assistance that it has been in the home. The fixing of vegetable prices, rough and inequitable as it was in many respects; saved the housewife and the wage-earner a substantial amount of money in the ordinary weekly budget, and when, under pressure from interested, parties and because of certain anomalies, control of vegetable prices was removed, there was an immediate and justifiable clamour for its reintroduction. It is inevitable that anomalies shall exist - at times they may even go to the limit of absurdity - under an arbitrary scheme of price fixation such as the selection of a base year for the formation of a prices scale. Profit margins in that year may have been as high as 100 per cent, in some instances, and in others very low indeed. During the war years also, the urgent need for full production meant the utilization not only of the big and efficient industries, but also of the relatively small backyard undertakings. The result was, of course, a wide diversity of costs throughout industry generally. Therefore, for any one to argue that because of some apparent anomalies, our price-fixing system has not been a marked success is to ignore the substantial benefits that have accrued to the community. The entire price-control structure cannot be derided merely by citing one example of the many anomalies that must necessarily exist in any such system. Last Saturday, the Sydney Daily Telegraph published an article pointing to the success of the Australian prices control system. The article stated that the present Prices Commissioner, following the lines laid down by his predecessor, Professor Copland, had held Australian prices better than they had been held in any other country in the civilized world. That being so, I suggest that any anomalies, or even absurdities, that may exist are matters that can be rectified as they are discovered. It is useless to argue that these things constitute a condemnation. of price-fixing in Australia, or are evidence that our prices system has not been a success. Pricefixing in this country should not be compared with what may be regarded as a perfect scheme, but with the position that would have existed in the absence of any attempt to control prices at all. Honorable members will realize that without price-fixing, unscientific and rough and ready as our system may be in some instances, the situation in this country would have been chaotic. Only on that basis should we estimate the value of our price-fixing system.

The right honorable gentleman referred also to the wage-pegging regulations and emphasized the great power reposed in the Chief Judge of the Arbitration Court. There is a curious contradiction in tho speeches of honorable gentlemen opposite from time to time. I recall that on one occasion when a certain measure was brought before this chamber providing for the appointment of a controller, but not making that officer responsible to any Minister or to the Government itself, eloquent speeches were made by honorable members opposite accusing the Government of an attempt to divest itself of responsibility in the -matter. It was claimed that the Government had not the courage to assume direction of the great problems presented by the industry concerned. The Government then amended the legislation, making the controller responsible to a Minister in some respects of his administration at least. Then we were told by the Opposition which, in the meantime, had performed a ludicrous volte face, that the Government had wrecked an excellent piece of legislation by limiting the freedom of the controller, upon whom tremendous responsibility was placed. That same con*tradiction runs through most arguments advanced by honorable members opposite, and was clearly present in the theme developed by the Leader of the Opposition to-day. The fact is, of course, that the Chief Judge of the Arbitration Court has always had a high degree of responsibility entrusted to him under the wagepegging regulations. In the early days of those regulations, it was necessary for applicants seeking higher wages to satisfy the Chief Judge that an anomaly existed or that there had been a change of circumstances. So, as the Government has relaxed the wage-pegging regulations, it has conferred a wide responsibility on the Chief Judge of the Arbitration Court - the instrumentality set up to determine wages and conditions. The Chief Judge under the amending Commonwealth Conciliation and Arbitration Act, introduced by the predecessors of honorable members opposite, must have regard for the economic consequences of- any action that he takes or any award that he makes.

The Government has prepared legislation giving effect to the proposals contained in the financial statement. The taxation measures will have a dual effect. One will be to reduce the income tax rates at present operating, and another will be to confer additional benefits on taxpayers by. changing the method of assessing deductions for family and other responsibilities. I applaud the Government’s approach to this problem. Throughout the world to-day taxation is a controversial subject. Citizens of almost every country are claiming that taxes are too high and taxation systems too complex. A loose comparison of taxes operating in this country with corresponding impositions in other lands’ can afford us nothing unless we know the comparative wage levels, and the purchasing power of those wages. We must know also the composition of the general body of taxes. In this country we are placing greater emphasis than ever upon direct taxation, namely, the income tax. The percentage of revenue received from the direct tax compared with that received from indirect taxes has increased from about 40 .per cent, in the pre-war years to about 60 per cent. now. That, I believe, reflects an enlightened approach to the problem. Direct taxes are fair in their incidence and equitable in their application. On the other hand, indirect taxes have ramifications that cannot be easily appreciated, and the incidence of their burden is not always obvious. Therefore, I believe that the Government’s attitude towards the whole problem of taxation is correct. Shortly after the cessation of hostilities, in pursuance of its announced policy, the Government began to relieve the people of the very heavy burden of war-time taxation. As we believed that it should, and as the country, by a substantial vote, has a approved, the Government formulated a sharply graduated scale of tax remissions, giving a greater percentage of relief to the lower than to the higher incomes. At that time, the finances ofthe country did not indicate that a reduction of taxes was either . possible or desirable. Later, but still before the nature of the post-war period was completely clear, the Government granted substantial remissions of sales tax’ and other indirect taxes. That decision showed an enlightened approach to the problem, because sales tax bears severely upon the businesses which are being established

Or which are developing in Australia. In its final incidence, sales tax bears moreheavily upon persons with family responsibilities than upon those without family responsibilities, and in percentage to total income, is much greater on the low income groups than on. the high income groups.

The Government has now introduced a number of bills which will grant remissions of tax, amounting to £33,000,000 during the next financial year. At the same time, the Government is continuing its borrowing policy. Interest rates payable to subscribers to Commonwealth loans are not high to-day, and borrowing is continued for the dual purpose of preventing an increase or maintaining

Stability of prices, and financing the services of the country. Differences of opinion exist among honorable members as to whether the Government should grant remissions of taxes while continuing to borrow for the purpose of financing the activities of administration. The Leader of the Opposition pointed out that money which had been allocated for loan works, had not been expended. As all honorable members know, in every State vast works programmes will be undertaken when materials and labour become available. The statement that heavy taxes are retarding those pro- grammes is without foundation. Another unfair suggestion, which the honorable member for Darwin made in an earlier debate, is that because visible goods and services are not so plentiful as they were before the outbreak of World War II., some workers are not actively or usefully employed. The simple explanation is that a vast body of workers are now engaged in, say, the building industry and such items as builders’ hardware are used immediately they are manufactured. Therefore, the facts as we find them disprove the statement of the Leader of the Opposition that taxes are retarding works programmes and the general development of this country. From our personal knowledge, we can affirm that overseas manufacturers desire to build factories in this country, and Australian enterprises wish to expand. The retarding factors are not high taxes but the shortage of man-power and materials. The Director of Employment in Western Australia informed me that the State’s vast plans for water conservation and the provision of electrical power will be severely hampered because of the lack of man-power.

Before and during the last election campaign, the Government announced, that it would grant remissions of taxes as or when they were possible or desirable. Honorable members opposite claim that they were instrumental in forcing the Government to grant subsequent reductions. The height of absurdity was reached during that campaign. For example, the Leader of the Opposition, who -was the spokesman for the Liberal party, advocated a reduction of about 20 per cent. The Leader of the Australian Country party (Mr. Fadden) outbid him with a proposal for a reduction of about 27 per cent. In various electorates, members of the Communist party said that if they were elected, they would reduce taxes by 50 per cent. One candidate favoured the abolition of taxes, and a publication which I received from an organization” urged electors to vote for the advocates of that policy. Those examples show the absurdity to which some people go during an election campaign. The simple fact is that every political party and candidate at the time of the last elections was well aware that taxes in Australia had reached their peak and that remissions were inevitable. Therefore, they endeavoured to outbid one another in an attempt to buy votes. It is an interesting reflection of the basic common sense and soundness of the Australian people that they rejected the advice of so many literary propagandists to vote for the Opposition parties, and returned the Government which had promised to reduce taxes “ when possible or desirable. “ The reason is obvious. The people knew from experience that the Labour Government would carry out its undertaking without pressure from them, and without offering a reduction of taxes as an election bait. They knew also from hitter experience that the political parties which now constitute the Opposition had been notable for their failure to honour their election promises. In the present election campaigns in New South Wales and Queensland, we again have evidence of the different approaches of the two political parties, which are opposed to the Labour party, to national and State problems.

The reductions of taxes, which this Government has made, are substantial, and are expressly designed to grant relief to those who most need them, and to stimulate the development of industry. The Treasurer saw the error which previous governments committed in similar situations, and determined to provide relief when possible or desirable. After World War L, the government of the day, because of increasing receipts from customs duties, believed that Australia was entering an era. of unparalleled prosperity, ‘and granted immediate and substantial remissions of taxes. This policy produced a temporary boom, which was followed in 1921 by an inevitable slump. That Government failed to heed the warning given by the increasing revenue .from customs duties, and depleted Australia’s credit overseas. In fact, it was financing its

Sinking Fund and interest obligations overseas by borrowing from, investors in Great Britain. It did so because it believed, from the rise in customs revenue, that a period of unexampled prosperity had arrived. It forgot that, in the long run, imports can only be paid for by means of exports. That lesson has been learned by the present Treasurer. Customs revenue is high to-day because of the great demand for goods that banked up during the war years. There can be no certainty that this revenue will continue. This fact should be kept continually in mind. Although we have a substantial trade balance to-day, we must realize that a heavy adverse balance could lead us into a situation similar to that which resulted from the unwise financial policy of antiLabour governments. The period of depression caused by that policy was much more serious in Australia than it was in other countries. Only the election of the right honorable member for Yarra (Mr. Scullin) to the position of Prime Minister enabled that disastrous economic drift to be corrected. As the present Lord Bruce said at the Ottawa conference, the economic transformation which, occurred in Australia within the brief space of two years - under the Scullin administration - was remarkable. He pointed out to the conference that, because of tariff restrictions and prohibitions, a heavy adverse balance against Australia had been converted within two years to a slight favorable balance. He described the improvement as being almost miraculous. Incidentally, he did not think to give credit for this change where credit was due. He attributed it broadly to the people of Australia.

The taxation proposals of the Government show that it has given wise consideration to all of the problems involved. It has planned a developing taxation system which places greater reliance on . direct taxes and less reliance on indirect taxes on goods and services. That is the correct policy to adopt, and I have no doubt that the Government will continue to pursue it. The Leader of the Opposition has said that the Government has’ had to look about hurriedly for some way in which to . expend the surplus revenue that it receives. That statement is absurd in the light of a .clear analysis of the situation. The right honorable gentleman has the ability to analyse this subject, but he has preferred not to exercise it. He did not drawattention to the fact that the surplus revenue is not surplus to Government expenditure, but is merely surplus to budget estimates, and that the Government, in order to meet its commitments, has had to obtain a substantial loan from the people. The loans will involve rising costs, perpetual interest payments, and, presumably, a repayment of the debt some day. Probably the raising of large loans at this stage is less advisable than the imposition of fairly severe income tax rates in order to finance governmental commitments. I invite the Leader of the Opposition and his supporters to state which branches of government expenditure they would eliminate. The Government provided for heavy expenditure under a variety of heads in the last budget, and it will do so in the next budget. In case the honorable member for Richmond (Mr. Anthony) is going to suggest a reduction in government departments, I remind him that expenditure on these services is but an infinitesimal part of total annual governmental expenditure. The large reduction of taxes suggested by the Opposition could not be met by cutting down the costs of government services, even if public servants were reduced to working without salaries.

The Government has given fresh evidence of its interest in the areas of Australia where living conditions are hard and costs are high. It has expanded the scheme which it laid down some time ago to give tax relief to people who live in isolated areas. I commend it for doing so. It has also granted tax remissions that will benefit family units. That is the correct way to effect tax reductions, anc ‘ the .policy should be endorsed by the people generally. Honorable members opposite claim, from time to time, that Australians are still the most heavily taxed people in the world. I invite them to produce figures in support of their claim. They should not overlook the fact that our social services are financed by means of a social services tax, the rate of which is graduated according to ability to pay, not on a flat rate basis, as in the sister- dominion of New Zealand, where the contribution amounts to ls. 6d. in £1, and in other countries. Examination of all relevant figures proves beyond doubt that Australians in high income groups pay taxes on a scale that is comparable with taxes levied in other countries. People in the lower ranges pay less income tax than they paid in combined Federal and State- taxes in the days before uniform taxation. This applies to incomes between £250 and £350 a. year. In general, the Government’s tax policy is wise. It has recognized anomalies which existed in a variety of faxes and imposts and has removed them. By means of income tax reductions and the extension of social services, it has given substantial relief in quarters where relief was most needed. Honorable members opposite may claim that the total monetary relief afforded in respect of low incomes is far less than that afforded to incomes in the high ranges. That is certainly true. However, the remissions should be examined as percentages, not as total amounts. The reduction in respect of low incomes has been as great as 100 per cent. Such remissions, of course, do not represent large sums of money, whereas a small percentage reduction of the tax on a, high income may represent a very large sum. I ask honorable, members opposite to approach this subject honestly and deal with the full facts. We can easily answer criticism based on false premises, but the Opposition should approach the subject fairly instead of dealing with only selected facts. The other proposals contained in this statement can be dealt with when the bills to implement them are being considered by the Parliament. I endorse the policy of the Government; 1 believe it is wise and just, and in accordance with the promise this party made to the people that we would reduce taxes as and when it was shown to be possible.


– The honorable member for Perth (Mr. Burke) has given us a most interesting exposition of the point of view of the Australian Labour party, and I have listened very attentively. Through the whole of his remarks there seemed to be running a thread of apology for the Government because of the comparatively small reduction it proposes to make in taxes and for the necessity of maintaining the present burdensome infliction upon the community. Neither I nor any other member of the Opposition questions the necessity for taxation. After nearly six years of war no one can dispute that taxation to-day must inevitably bc higher than it was in pre-war years. The Government must provide finance for the aftermath of war, because of the heavy expenditure involved in repatriation and rehabilitation, a charge the community must meet. Therefore, any one who suggests that we should go back to pre-war rates of taxation is unaware of realities to-day. At the same time, I would point out that the rate at which this Government is reducing taxes is not such that the people can expect any substantial lightening of the burden which they are carrying. I refer honorable members to the financial statement made by the Treasurer (Mr. Chifley) at the end of last year, in which he said that war-time expenditure reached a peak in 1943-44, when £548,000,000 was appropriated. That sum entirely excludes expenditure on ordinary civil administration. By 1945-46 war expenditure had dropped to £278,000,000, and in 1946-47 the sum appropriated to cover the maintenance of out force, in Japan, repatriation, rehabilitation, soldier settlement, and so on, had declined to £110,000,000. The reduction from £54Si000,000 in 1943-44. to £110,000,000 in 1946-47 represents a fall of £438,000,000 in war expenditure. But do we find any reduction of taxes commensurate with the lightening of the Government’s burden? The speech of the Treasurer shows an immediate reduction of taxes of £36,000,000, or, te be quite fair, of £71,000,000 since the end of the war. That means that although expenditure declined to the extent of £43S,000,000, taxes have been reduced by only £71,000,000. I appreciate that a great deal of the finance for war. expenditure was raised from loan funds, but, at the same time’, something like 40 per cent, or 50 per cent, of it was realized from revenue. If one examines the financial statement made by the Treasurer at the end of last yea>r, one finds that whilst war expenditure declined to the substantial amount which I have indicated, governmental expenditure rose from £164,000,000 in 1945-46 to £221,000,000 in 1946-47, an increase on purely civil expenditure for the twelve months of £57,000,000. How can the unfortunate taxpayer expect any lightening of his burden when he knows that the Government disregarded its opportunity to reduce taxes, and, on the other hand, deliberately increased expenditure? I believe that a day of reckoning will come; that we are not always going to enjoy prosperity such as we have at present. Just now employment is at its peak, and customs and other revenues are buoyant. That is attributable to the fact that the community is making up the lag of nearly six years by purchasing goods and services denied them during the war years, as the honorable member for Perth stated so clearly. Because of that, we are enjoying a boom at the moment. But any one with any knowledge of history realizes that that condition cannot continue indefinitely. We all know that the cycle must end; and it is our duty to provide for the leaner times ahead. As a matter of national policy, expenditure should be restricted in times of prosperity so that when depressions occur governments may be in a position to meet them. It is generally accepted as a principle of finance that the duty of governments during depression periods is to create work for the unemployed by means of public works and the disbursement of public money. But that can only be done if governments curtail their expenditure in times of prosperity.

The financial statement made by the Treasurer proposes some reduction of taxes. However, even with the proposed reductions, a man in receipt of £500 a year will pay £71 17s. in income tax and social service contribution, whilst a man receiving £1,000 a year will pay £22S, and a man in receipt of £S00 a year will pay £157. Will the proposed reductions be of any substantial benefit to persons who are trying to pay their way and improve their position in life?

Sitting suspended from 1248 to Si. 15 p.m.


– insofar as it contains an acknowledgment by the Prime

Minister that there is need to reduce taxes, the financial statement which we are now debating is very welcome. The statement, however, is in strong contrast to those of the Prime Minister and the Attorney-General during the last election campaign. At that time the Leader of the Opposition (Mr. Menzies) and the Leader of the Australian Country party (Mr. Fadden) said that if the Opposition were returned to power its first act would be to reduce income tax by from 20 per cent, to 2S per cent., according to the figures as they found them, the overall reduction being estimated at £33,000,000. That promise was described by the Prime Minister and his colleagues as misleading to the public and impossible of performance by an honest government; yet a few months later the Prime Minister himself proposes to reduce the income tax, and informs us that the proposed reduction will be approximately 26 per cent., a figure which is remarkably close to what he so recently described as impossible. If there is any justification for an Opposition continuing to fight against a Government’s overwhelming majority, it lies in the fact that we have compelled the Government by force of argument, and by mobilizing public opinion, to adopt the proposals which we put forward. Of course, in the last resort, public opinion is the only thing that can move the Prime Minister. It is characteristic of the Government that it moves only under pressure. This was exemplified in the case of the wage-pegging regulations. The Prime Minister, with characteristic obstinacy, refused to repeal the regulations until pressure from the Australasian Council of Trade Unions, and the industrial unions became so great that he was compelled to yield to it. Even then, as was pointed out by- the Leader of the Opposition, he tried to save face by throwing the responsibility, not upon the Government, but upon the unfortunate Acting Chief Judge of the Arbitration Court, who has been bitterly abused by members of the Cabinet. However, we are thankful for small mercies - for the belated reduction of income tax which, as has been pointed out, could have been made long ago, and could have been even greater had the Government taken full cognizance of the decline of war expendi- ture, amounting to £450,000,000 in the last two years. Against such a substantial decline, the reduction of income tax is miserable indeed.

Who is it who .bears the burden of taxation? Its real weight is not felt by the big fellow with a huge income, whom honorable members opposite are always so ready to “ plaster “. I maintain, however, that excessive taxation even of companies and wealthy individuals has an adverse effect on the community, because it prevents the establishment of reserves from which new enterprises are financed. Without reserves of this kind industrial expansion is impossible. All over Australia . to-day there are opportunities for expansion, whether of farms or small businesses, but they cannot be availed of because all surplus income is taken by the tax gatherer, and is used by the Government on unproductive undertakings. In point of fact, heavy taxation bears most greviously upon the bulk of the community who are in receipt of low incomes. I have here a list taken from the Quarterly Summary of Statistics showing the number of taxpayers in Australia for the year 3 944-45, the latest for which figures are available. In that year, 2,052,000 persons stint returns to the Commissioner for Taxation, ‘ and, 3,250,000 of them returned incomes of less than £500 a year. Thus, the vast majority of taxpayers are the little people receiving less than £10 a week. It is of great importance to them that their purchasing power should be improved by a reduction of taxes.

Everybody recognizes the need for a certain amount of government expenditure, but as J. have pointed out, although war expenditure has declined by £450,000,000, Government expenditure on other items has increased by £60,000,000 a year. The Government justifies this by saying that it has provided social services, that it is doing something for the underprivileged person that was never done before. It claims that though the people are paying income tax and social services tax on a high scale, they are receiving a good return on their money from the Labour Government, because of the social benefits which they receive out of the National Welfare Fund. Among those benefits are invalid and old-age pensions and child endowment which were inaugurated by non-Labour governments, and would be continued under non-Labour governments. Widows’ pensions were introduced by the present Government, but they had previously been in operation in New South Wales, so that the people of that State, at least, have not benefited by the passing of the Commonwealth legislation. For the period mentioned the amount paid as widows’ pensions totalled £3,247,000, whilst maternity allowance payments amounted to £2,493,000. The maternity allowance was brought in by a non-Labour government. It is true that the allowance has been increased since the present Government has been in office, but, even so, the purchasing power of money has fallen so greatly that the value of the allowance has not necessarily increased. Unemployment and sickness benefits involve a payment of £1,144,000 whilst funeral benefits call for an expenditure of £1S5,000. These payments represent a heavy burden on the taxpayers, and as I have shown that the groat majority of taxpayers are workers, .honorable members will realize that most of this burden falls on the shoulders of the workers. I emphasize that many of these benefits existed long before the present Labour Government came into office. Although the worker pays his share of direct taxes, he pays an undue proportion of indirect taxes. Figures extracted from the Treasurer’s statement show that of a total revenue of approximately £358^000,000 from taxes for the year 1945-46, income tax represented £195,000,000 and indirect taxes £163,000,000. The latter sum included £33,000,000 derived from sales tax. Does any supporter of the Government contend that sales tax is not, in the main, paid by the masses of the people? Excise duty yielded £49,000,000 in 1945-46.

For over six years the majority of houses in Australia have not been painted.

Mr Fuller:

– The honorable member surely does not blame the Labour party for that?


– No. I was about to point out that customs and excise duty on paint and oils for the year 1944-45 amounted to £S,526.000, and in the following year to £12,156,000. Will the honorable member for Hume (Mr. Fuller) say that, in the main, that extra tax did not come out of the pockets of the working people of Australia? Another item which I have taken at random from the records is that the excise duty on matches amounted to £150,000 in one year. My point is that these items represent taxes extracted from the worker in addition to income tax and must ultimately come out of his pay envelope. The time has come for the people to examine for themselves the effects of Labour administration. Today, Australia is enjoying a measure of prosperity, due partly to inflation. It is a time when governmental expenditure should be held in check, so that should a depression come - and we all know that ‘ depressions do come periodically - the Government may be able to relieve the situation by engaging in public works which will provide employment. That is acknowledged to be one means of minimizing the effects of a depression. The principle is that when work is plentiful, governmental expenditure should be reduced ; but that when private employment slackens and unemployment is created, the Government should absorb misplaced workers by undertaking large public works. The present Government has reversed that policy; it proposes a big programme of public works at a time when the demand for workers is already greater than the supply.

We all know that a company has no body to be kicked or soul to be damned, and it is evident that companies in Australia are not loved by the Government. Yet they provide ‘ employment for the great masses of the people. If we create conditions which curb their activities unduly, we strike a blow at their capacity to provide employment for workers. Some figures relating to a small company with about 60 employees may be of interest to honorable members. Among the contributions to Consolidated Revenue by that company in one year were -

Mr Beazley:

– The company does not pay income taxes deducted from its employees.


– Those items total £11,687 and as the income of the company was approximately £13,000, it will be seen that less than £2,000 was divided among its shareholders. That is the experience of one company which is typical of companies operating in Australia to-day. My friend the honorable member for Perth said.- that there are very many young people in this country anxious to start enterprises of all kinds. I have no doubt there are ; I know many of them ; but they are desirous of doing so in the expectation that oppressive taxation will be lightened before their operations become productive. In view of the present set-up of the Labour Government, and the figures I have just cited, showing progressive increases of expenditure of a non-war character, how is it possible to expect a. reduction of taxes? Yet, if taxes are not reduced, how can business enterprises expand? Every person in the community hopes to be able to set aside from his income sufficient to be able to buy a house or a farm or, in the case of those with more modest incomes, say, a piano. Every penny that they expend for these purposes creates employment for others. The man who buys a piano creates employment for a variety of workers; the man who buys a farm and ploughs a field not only creates employment but also provides revenue for the railways and produces additional foodstuffs for the cities. If the. Government takes away too big a portion of the earnings of an individual, a company or the community, which would otherwise be set aside for the expansion of private enterprise, unless it can justify its action up to the hilt as was the case during the war, the only result will be to retard our progress and development. I have pointed out that from 1943 to 1947 there has been a reduction of war expenditure amounting to £43S,000,000 ; surely that justifies a. more optimistic financial statement than the document we are now considering.

There is another matter to which I should like to refer which is, perhaps, a little beyond the ambit of the financial statement, namely, the economic position of New Guinea. We might have expected some degree of progress, some lightening of the burden of the Australian taxpayer as a result of the expansion of activities in New Guinea. I have made extensive inquiries regarding the position there, and it is quite apparent that under the administration of the present Minister for External Territories (Mr. Ward) there is little hope that while the present Government remains in office New Guinea will be able to play its part as an economic unit of our Commonwealth territories. Planters have complained that they can uo longer obtain labour to assist them.


– Order ! The honorable member is anticipating a debate on a motion standing the name of the honorable member for Balaclava.


– I thought that that debate had been concluded. In view of your ruling, “sir, I shall not continue to discuss the subject.

I refer now to the position of Australia in relation to the occupation of that part of Japan which comes within the area controlled by the British Commonwealth Occupation Force. Recently, Mr. David Heritch. a member of General MacArthur’s staff at Tokyo, visited Australia. I understand his visit followed a request, by the Commonwealth Government to General MacArthur that a textile expert should be sent here to advise the Government on matters relating to trade with Japan. According to press statements Mr. Heritch, in his report to General MacArthur, said -

In Australian political circles there is a lack of complete information about the aims and progress of the occupation.

That is “a remarkable statement from a man whose contact with Australians must have” been confined to members of the Commonwealth Government and heads of departments. Mr. Heritch. also said that the Australian representation in Japan was not as full as was desirable and that it should be on a more adequate and permanent basis. Whether or not Mr. Heritch is qualified to speak on the subied of the Australian occupation of Japan I do not know, but I do know that the Commonwealth Parliament knows very little about what is going on in Japan or the situation of our Australian troops there. Not one member of the Parliament other than the Prime Minister (Mr. Chifley) and the Minister for the Army (Mr. Chambers), both of whom made very sketchy visits - I believe the Prime Minister’s visit lasted two days and that the Minister for the Army spent only a week there during the Christmas period - has any personal knowledge of very important matters relating to our occupation, the necessity for its continuance, the status of our troops there, the conditions under which they exist or their relations with the American forces.


– Order ! The honorable member’s time has expired.

Debate (on motion by Mr. Beazley) adjourned.

page 1897


Brussels Sprouts - Telephone Services - Re-establishment : Inmates of Repatriation Hospitals; Reconstruction Training Allowances; Preference to Ex-service Personnel - War Pensions : Unemployment Relief Deductions.

Motion (by Dr. Evatt) proposed -

That the House do now adjourn.


.- I bring to the notice of the Government the plight of a number of vegetable-growers in Ferntree Gully, because vegetablegrowers in many other places may find themselves in similar circumstances. Certain vegetable-growers at Ferntree Gully have entered into contracts with Messrs. Gartside Brothers, of Dingley, and Kan’s Food Products of Moorabbin for the canning of brussels sprouts. The value of contracts- made by the latter company for this season exceeds £16,000, and that of all contracts entered into by all canning companies must be a considerable amount. During last month, these two factories were refused any tinplate by the Controller of Tinplate for the purpose of canning brussels sprouts and, consequently, cancelled these contracts. I point out that the growing of brussels sprouts is a fairly long process, approximately six months, and involves constant care of the plants during that period. I shall cite the case of two exservicemen at Ferntree Gully which is typical of the circumstances in which vegetable-growers at Ferntree Gully now find themselves. These two men took up vegetable-growing some time ago and entered into a contract with Kan’s Food Products to supply brussels sprouts, the total value of the contract being approximately £1,S00. Up to date the costs incurred by them amount to £100 an acre and they have 6 acres under cultivation. That cost covers such items as manure, dust, labour, stock feed and seeds. Their deferred pay and the money they saved while on war service is not sufficient to finance that outlay. If their contract is broken they will not receive the £1,800 for which they contracted with the canning company, and all their labour for six months will be wasted, whilst, at the same time, they will lose all the money they have invested in the venture. Those two men will actually be ruined financially. Many other vegetable-growers at Ferntree Gully are placed in similar circumstances.

It may be thought that if the canning factories do not take these brussels sprouts these . can be sold on the open market; but that is not the case. First, the market for brussels sprouts is always consistent ; and as it was widely known in Victoria that these contracts were entered into, growers in other parts increased their acreages of brussels sprouts. Therefore, if these supplies are not taken by the canning factories they will be a dead loss, not only to the people concerned but also to the public. It is impossible for these growers to change to other crops because they are in a dry non-irrigated area.

Dr Evatt:

– The honorable member knows that the supply of tinplate is so short that any supply at all can only be made available under certain restrictions.


– I realize that tinplate is in short supply everywhere. However, my point is that these growers must be saved from financial ruin, because many growers and many thousands of pounds are at stake. For that reason, I ask the Government to intervene in the matter as early as possible. One of the canning firms concerned proposed to can from 20,000 to 24,000 cases of brussels sprouts, and .if it be unable to obtain sufficient tinplate, it will be obliged to put off employees. I also point out that when the matter, with respect to the various lines of vegetables to be canned, was discussed earlier this year, the Controller of Tinplate indicated that equal preference would be given to brussels sprouts as to other vegetables in the allocation of tinplate. Therefore, I ask the Government to ensure that a reasonable allocation of tinplate be made for this purpose. Another point is that there is a widespread impression among users of this material that allocations of it are not being fairly made. I do not know any of the members of the Commonwealth Canning and Tinplate Board, but people with whom I have conversed on the matter recently allege that some members of the board are themselves users of tinplate, and that in making allocations they do not treat themselves unfavorably. It is said, in fact, that they have the first “whack” at whatever supplies are available. I do not know whether that allegation is well founded, but the Government should investigate it. My last point is that the facts I have given show clearly the great damage that can be clone by arbitrary action on the part of government officials whether individually or as members of boards. Whether the decision is made after or without consultation, it throws out of employment large numbers of people and ruins others. One does not object to necessary control, but everyone concerned should be consulted before any decision is made in allocating materials in order that perfectly innocent people may not be damaged. I hope the Government will give this matter immediate consideration.

Dr Evatt:

– I shall place it before the Minister for Supply and Shipping immediately and have it examined at once.


.- I submit a proposition for the consideration of the Postmaster-General (Senator Cameron). It is a request for the establishment of a fund from the revenue of the Postmaster-General’s Department to provide for communication requirements of people living in remote areas. In my electorate there are many courageous people who have gone out into the un developed parts of the country to carve out a home .for themselves and their families. Immediately such people do so they are handicapped by regulations. In the Gippsland electorate there are settlers living 40, 50, or 60 miles from doctors, hospitals and nurses and all the social amenities so necessary for people to-day. They naturally consider that they are as entitled to modern facilities as are city dwellers to whom those facilities are so readily available. I refer particularly to telephones. To every request for the installation of telephones they receive the reply that telephone installations made beyond a certain point must be paid for by them. Even if there were any moral reason why they should be required to pay, it is beyond their capacity to do so. So they have to do without. They are developing this country. They go into areas into which a city man would not dream of going except to spend a holiday. We must be more realistic in our approach to requests of this kind. These people are taxpayers. They are not relieved of income tax because they are developing the country. They have to pay their share of tax and put up with all the hardships of their existence. They are denied the amenities that their taxes help to provide for their more fortunatelyplaced fellow citizens. I make no complaint against the officials to whom the requests of these people for telephonic facilities go. Indeed, I compliment them on their unfailing courtesy and on the completeness of their investigations. They have a full knowledge of the needs of the settlers and I think that if they had the say, the service would be installed immediately, but they are bound by regulations. I do not want the Postmaster-General to say that he is unable to do anything because of the regulations. Nothing is simpler than amending the regulations-, if the Government desires to do so. Neither is lack of money an excuse, for the AuditorGeneral’s report discloses that in the last two financial years the revenue of the Postmaster-General’s Department exceeded expenditure by £3,680,340 and £3,S’78,297. Even allowing for capital expenditure, I do not see why my request should not be granted. The Government has a good precedent to follow., In all the States the main roads boards allocate to shire councils money to expend on the building of roads for isolated settlers. It is called the Isolated Settlers Grant. If it is competent for a governmental authority to do that it is equally competent for the Commonwealth Government to set aside some of its revenue from the Postmaster-General’s Department to supply isolated settlers with telephones. The revenues of .the department are buoyant, especially as the Postmaster-General seems determined to retain the postal surcharge of one halfpenny a stamp that was imposed for war purposes. A fund of £25,000 a year would go a long way towards helping the settlers. The Government might vote a larger amount.

Recently I visited one remote area of my electorate to learn the facts at first hand. A proposition made to the settlers there by the department was that they erect 900 poles costing £1 each, purchase wire and insulators and pay for labour. The cost would be about £2,000. Theycould not pay it. It is a ridiculous proposition. They would be satisfied with a tree line, but the department frowns on any suggestion of -a party line tacked on trees. These people do not want to talk to America or Japan; they only want to be able tq ring up the nearest town. When the department realizes that, it may be more amenable to reason and more inclined to amend the regulations in order that it may provide the service asked for. The sum of £25,000 would never be missed from the postal revenue, but telephones would greatly encourage and. promote much happiness among- the people who dare to go out into the wilds to shape themselves an. independent home for the benefit of Australia. I do not want this matter to be ignored. I want it to be submitted to the Postmaster-General with, I trust, the support of the Minister who submits it to him. The proposition is sound and sane. I hope that such favorable consideration will be given to it that I shall be relieved of the necessity to bring it up again.

Mr. BLAIN (Northern Territory [3.5]. - I realize any honorable member who speaks on the adjournment at the end of the week lays himself open to the charge that he does so only for the sake of talking. However, I willingly submit to that charge because during the last month back-benchers in this chamber have been deprived of an opportunity to place their grievances before the House. Yesterday, although private member’s day, was almost fully occupied with a discussion on the Victorian strike, and once again private members had no opportunity to discuss minor grievances. However, I do not speak with any diffidence with regard to matters I shall raise now. The first concerns ex-servicemen, most of them former prisoners of war, who are in Concord Military Hospital. The second relates to living allowances under reconstruction schemes. I regret that the Ministers who deals with these matters are not now in the chamber.

Dr Evatt:

– I shall let them know what the honorable member says.


– The Ministers should be here now to listen to important matters raised by private members. That is their duty. They are drawing salaries and they should not be out playing golf or catching trains. I have received the following letter from certain patients of the Concord hospital : -

Dear Sir,

We would like to bring to your notice th<i insufficient rate oi sustenance paid to sick ex-service personnel while a patient in a repatriation hospital.

If a nian is receiving a special pension due to war disability, he is totally incapacitated, but if he is receiving a full pension he is able to earn by work money to assist his pension. But the sick man in hospital who receives sustenance of a full pension is. in no position to earn more to assist that sustenance.

We only ask for something reasonable when we say we would like sufficient sustenance to pay our rent and keep our families in a decent manner. Is it fair that a man should draw on his life savings, deferred pay, back pay received from being a prisoner of war or when that has gone be humiliated by being in debt through being a sick ex-service personnel.

Every man is aware of the high cost of living before the basic wage rise of 7s. per week but the repatriation patient did not receive any rise and the cost of living, went

Hp higher giving us less chance.

We have written a similar letter to the Sth Division Sub-branch of the Legion of Exservicemen and Women, and the Returned Soldiers’ League and head body of the Legion of Ex-Servicemen and Women and in which we have informed them of your willingness to give your support in all ways available to you through your position to- do so.

That letter is signed by 22 patients and the first name is that of a former prisoner of war whom I took’ away with me from this country in the, 2nd/12th Engineers from Tamworth. We were separated for three years while we were prisoners of war but we have met since our return to this country. He was a good tradesman - a plumber - and he obtained his discharge from the army as quickly as he could - too quickly he found out later. He was earning £10 a week at his trade, but after six months he’ cracked up, having had amoebic dysentery in Malaya, and is now in hospital, a wreck. He is a married man, and is receiving only £2 10s. a week. There is no hope of his allowance being increased unless the Minister for Repatriation rules otherwise. That is only one specific case; 21 other men have signed the letter. Many men obtained their discharges from the services tod quickly. That applies particularly to prisoners ‘ of war who were anxious to return to their homes as soon as possible. Some even urged the doctors to mark them Al so that they would be released immediately. I, myself, was one of those, but I am a piece of fencing wire and apparently have a metabolism that men with twice my physique do not possess. However, I am not speaking for myself now. I am speaking for the many ex-servicemen who are in poor physical condition and are being treated in hospital. .Some of them were earning as much as £10 or £15 a week, but now receive only £2 10s. a week for themselves and their families. The wife of this man works three days a week. She told me that she was looking for a house, but fortunately, she was a Sydney girl and was able to live with her mother. I ask the Attorney-General (Dr. Evatt) to place this case before the Minister for Repatriation (Mr. Barnard). I realize that the Minister is a humane man, and I know that he visits the repatriation hospitals, but he should go more often and. see the patients who make these complaints. I am confident the Minister will give favorable consideration to increasing this meagre allowance-‘ of £2 10s. a week. I have been waiting for a month to put. this matter before the Minister because I believe it to be of! considerable public importance.

To-day I received a letter from the New South Wales Council of Reconstruction Trainees stressing the inadequacy of the living allowances paid to these men. Many of them entered the services in their youth, probably straight from school, and had no opportunity to enter a trade or a profession. .Now they have returned, and the Government is providing them with training in skilled occupations, or with the university courses. I do not wish to be unduly critical of -the Government’s .efforts in this direction. I congratulate the Government on what it has done in respect of university students. It is only fair that ii they fail in the first year of their studies they should be given an extra year. Any man who will try twice has something in him. Unfortunately, however, allowances are far from adequate to meet the present high cost of living. A single man receives £3 5s. a week, and a married man £4 16s. a week. Both these allowances, particularly that payable to married men, are totally inadequate. I have personal knowledge of some of these cases. Only three weeks ago I went to see a young man who, according to advice I had received from my nephew in New Guinea, wished to be a surveyor. I went to his house in Carlton, Sydney, and asked him if he would become articled to me. He was a good mathematician, and I was sure that he could have succeeded in the job. He told1 me that he arid his wife and nine-months-old baby were living in one room, and that he was too ashamed to invite me inside. He said that if I had come to him six months ago- he would have seized the opportunity’. The authorities had “’ fooled ‘’ him- around for nine months without giving him any definite information and he; had been forced to take a job- as a labourer’ with the Main Roads Board at £7 a week.

In the office which I occupy in. Sydney, there is a young man, a former member of the Royal Australian Air Force, who married a girl’ from Canada, while he was training in that dominion. This young couple is expecting a baby in’ September, and they are extremely worried about how they will make end’s meet upon his income1 of £4 16s. a week. These matters are moat serious. About ten days ago, a- big meeting: was held in the Sydney

Town Hall to discuss the situation, and speakers emphasized that the Government must review the whole matter of sustenance, not only for single men at the university, but - also for married men. The Minister for Works and Housing (Mr. Lemmon) must endeavour to ensure that ex-servicemen shall be granted preference in the allotment of accommodation. Has the Minister any influence with the State authorities in this matter? When many of us were prisoners of war after the Malayan campaign, a considerable difference of opinion existed among the men as to whether ex-servicemen should receive preference in employment on their return to Australia. This division of opinion existed for about four months, and before the Japanese transferred us to the slave camps. At that time, we were still husky fellows. Many men would not entertain the idea of preference in employment for ex-servicemen. I was elected president of an old diggers’ association there, and I arranged a series of lectures on this subject. Some of us emphasized that the ex-serviceman had a right to occupy, on his return, the position that he would1 have occupied had he not enlisted. Surely that is not too much to ask. Many of the men ultimately adopted my views on the subject. [f, for instance, a serviceman had beena member of the Public Service, he should, on his discharge,, and after a few months’ training, be given the position that he would have filled in the normal course. It is futile for the Government to attempt to evade this responsibility. Many men were not allowed to serve in the armed forces, because they were employed in essentia! industries, such as munitions’ establishments. We cannot blame them. Self-preservation is the first law of life. In addition, we cannot blame them for “ digging-in “ and “sitting pretty” before the end of the war. The soldiers know that they did, and, what is more; this Government is fully aware that they did. But the exserviceman finds himself “ on the outer “, because he had’ no opportunity to “ digin “ or “ sit pretty “ in civil employment, as they did. Those who stayed1 at home had the opportunity to consolidate their positions, and they did so. Therefore-,

I contend that ex-servicemen must be granted a measure’ of preference in employment over those who, during the war, were in a position to look after their own interests in civil life. I hope that the Minister for Post-war Reconstruction and the Minister for Repatriation will heed these statements.

Naturally, my constituents think that on the motion for the adjournment of the House, I should deal with subjects concerning my electorate and be a “good member “.


– Order ! The honorable member has exhausted his time.

Mr. WHITE (Balaclava) [8.18).- On several occasions, I have emphasized to the Prime Minister (Mr. Chifley) the fact that war pensions should not be regarded as income, and, therefore, be deductible from unemployment relief payments. When this Government- introduced the Unemployment and Sickness Benefits Bill two years ago, the Opposition submitted an amendment providing that war pensions should not be regarded as income for this purpose. The whole principle was opposed to the declared policy of preference for exservicemen. The Minister for Labour and- National Service.- (Mr. Holloway), who was in charge of the bill, gave to members of the Opposition an assurance that he would discuss their representations with Cabinet, and we withdrew our opposition to the bill, in the confident expectation that some adjustment would bo made. Unfortunately^ the position has not been, altered. As the result of a series of widespread industrial disputes, such as Victoria is experiencing at the’ present time,, thousands of men have -been obliged to apply for unemployment relief,, which is really the dole. I hope that I am not talking to the empty air on this subject. I have mentioned it on a number of occasions, and I urge the Attorney-General (Dr. Evatt) to discuss it with the Prime Minister. Fine sentiments were expressed, at services held at our war memorials on Anzac Day, but ex-servicemen .who are receiving war pensions are. living memorials. They lost a limb, a hand, a leg or fingers, and for- those disabilities they are. now receiving a small war- pension. If a trade unionist is thrown out of work, any financial benefits which he receives from the industrial organization is not offset against unemployment relief. But an unfortunate ex-serviceman, who, for the loss. of a hand, or an eye, and ‘who receives a war pension of, say, 23s. a week, is paid unemployment relief amounting to only 4s. a week, because

I he. war pension is deducted from the dole. Sympathy is not enough. When I raised this matter on my own initiative, the Opposition, as a whole, strongly supported my representations. I received the following letter from the general secretary of .the federal executive of the Returned Sailors, Soldiers and A irmen’s Imperial League of Australia : -

In referring to your letter of the 14th April, to which was attached a letter from the Minister for Social Services, in relation to exemption of war pension when assessing the income of applicants for social service benefits, it is advised that further representations in this regard will, no doubt, be made by the league.

The federal secretary of the Limbless Soldiers’ Association of Australia wrote -

We sincerely hope that the bill will be so amended as the subject in question is one which vitally concerns limbless soldiers.

When I directed the attention of the Prime Minister to this matter, some weeks ago, he said that he would investigate it. Subsequently, I received the following intimation from the Minister for Social Services (-Senator McKenna) -

As you ‘are aware, this question has been brought forward from time to time during recent years .and has received careful consideration. Whilst I am, personally, sympathetic towards any proposal for an amelioration of conditions for those men who have become incapacitated in the service of their country, I cannot overlook the fact that, if it were decided to disregard war pension payments in assessing income for social service purposes, the Government will find it difficult to resist requests that other forms of benefit granted in respect of injury or illness, e.g., workers’ compensation, mine workers’ pensions, &c., be accorded similar treatment.

I regard that as a specious answer. The Minister, while expressing his sympathy, is not prepared to rectify the anomaly. I believe that I should submit a motion for the formal adjournment of the House to discuss this matter, of urgent public importance. The recipients of war pen- si ons are not a clamorous group. They do not go on strike, and they are not welded together into strong “ pressure groups “ which make governments jump. They are ordinary men, who volunteered to serve their country in war-time, and the evidence of their active service is their own disabilities. These men have defied their disabilities. Yet, Ministers, who have not any knowledge or understanding of these things - I do not emphasize that, but I say it factually - are prepared to allow war pensions to be deducted from unemployment relief payments. I do not desire to raise this matter again, but if this anomaly is not- promptly rectified, I shall move the adjournment of the House for the purpose of directing attention to it. I urge the Prime Minister not to be obdurate. We know that he is an obstinate man. He has periods of silence which may be interpreted as the silence of a strong man or an unsympathetic man. I prefer to believe that the right honorable gentleman is only waiting for the appropriate moment to adjust this matter. Recipients of war pensions deserve every consideration. The sentiments which were expressed on Anzac Day will be mere lip service to patriotism if this” state of affairs is allowed to continue. These men have given a demonstration of practical patriotism, which is the only patriotism of any value. I need not remind honorable members of what Dr. Johnson said about patriotism. I ask the Minister for the Interior (Mr. Johnson) to take this matter to the Prime Minister and have it settled. Let us not have any more subterfuge and promises by one Minister to hand the matter to another Minister, who says, “ I believe in the justice of the claim, but I am sorry that nothing can be done”. I believe that the other anomalies which are mentioned have been reviewed by the Government only in order to find an excuse for doing nothing. The miners have other ways of securing monetary recompense for injuries they may suffer. The disability pension of an. ex-serviceman is paid to him as a sort of compensation for the handicap that he must suffer throughout the rest of his life. I am sure that the Minister will give this matter further consideration. I ask the Government to make provision in the bill that will soon be dealt with in this House to meet the case which I have submitted.


– Ever since I have been a member of this Parliament I have been impressed by the soundness of requests made to the Government by the honorable member for Gippsland (Mr. Bowden). The reason7 able appeal which he made to-day on behalf of his constituents applies admirably to residents of my electorate. He referred to mountainous country in the Gippsland electorate; in the Wimmera electorate, there are large areas of almost desert country adjacent to which is some fertile land on which men are trying, as the honorable member indicated, to hew for themselves a heritage. I strongly support his request for the creation of a fund to provide telephonic services for people living in outback areas. The only point on which I disagree with him in this regard - and it must be due to the honorable member’s modesty - is the amount of money which he proposed for the fund. However, that matter can easily be put right. I suggest that more than £25,000 a year should be allocated for the pro-1 vision of such services. AVe all know that the costs of wire, when it is available, and other materials needed for telephone services are high. Why should telephone communications be centred chiefly in the cities? We hear a great deal about decentralization in Australia, but what we need first is decentralization of amenities so that people will go to live where civilized condition’s of living are available. It is well known that amenities are scarce in the wild mountains of the upper Dargo region - the kind of country which the honorable member for Gippsland had in mind - and in the “Sunset country “ and beyond Werrimull in the Wimmera electorate. We should rectify this state of affairs as quickly as possible. Women and children who live in those isolated areas are entitled to have telephone services which they. may use to summon medical or other aid in times of emergency.

Mr Bowden:

– And they should not have to pay for them.


– At any rate, they should n.ot have to pay for them at an excessive rate. The farther away from, centres of population that one lives, the greater are the costs of amenities. Telephone services should be provided for residents of the outback at a low flat rate.. As is his custom, the honorable member for Gippsland has stated this case very clearly. I support him strongly.

I also give my strenuous support to the statements that” were made by the honorable member for the Northern Territory (Mr. Blain). His claim on behalf of exprisoners of war is very near to my heart. I know that the honorable gentleman is greatly concerned about the welfare of exprisoners of war because, when he was in Outram Road Jail at Singapore, there was a time when he could not stand upright and had to move about on his hands and knees. A man who has survived such experiences and returned to Australia is able to put the case for his fellow sufferers in a way that perhaps may not be appreciated by all honorable members, but which should engage the prompt and favorable attention of the Government. When the honorable member proposed an increase of sustenance payments to exprisoners of- war who are at present in hospital, I suggested by interjection that, if a subsistence allowance of 3s. a day for the period of imprisonment were paid, as I have advocated consistently since I have been a member of this Parliament, there would be no necessity for so many of these men to go to hospitals. A man who was not a prisoner of war has written to me enclosing a newspaper cutting which describes what is being done in America for former prisoners of the Japanese. The letter states -

I am enclosing a cutting from a Detroit News, U.S.A., dated 31/12/45.

As I have been listening with great interest to your fight for payments to P.O.W.’s, I thought it may be of interest to you. It gives a fair indication of the way the U.S.A. are treating their P.O.W.’s.

The .newspaper extract is as follows: -

Vacations at leading Detroit hotels - with all expenses paid - await prisoners of war who are now returning to this area.

The plan was announced by the Array’s Sixth Service Command at Chicago.

It will go into effect Thursday in Detroit and Milwaukee and will be extended later to other cities.

The War Department will provide transportation, hotel rooms and the best in meals for the veteran and two members of his family.

Fancy asking this Government to do as much as that for ex-prisoners of war! The report continues -

Jerry Moore, manager of the Hotel Fort Shelby and Chairman of the Board of Directors, Detroit. Hotel Association, said the Army has signed contracts with six Detroit hotels.

They are the Book-Cadillac, Statler, Fort Shelby, Whittier, Detroit-Leland and Tuller.

P.f.c. Richard W. Wilson, of Dickerson Avenue, was the first to receive a room, beginning Thursday, Moore reported. He selected the Whittier Hotel.

The Army estimated the cost would be $133 to $392 per veteran, depending on the number’ of dependants who accompany him.

Meal allotment will be $0.50 daily per person, including $.1 for breakfast, $2 for lunch and $3.50 for dinner.

Hotels have promised the guests will receive “ super service “.

In addition to long special leave - that is what is given to ex-prisoners of war in the United States of America - super-service at good hotels at the expense of the Government. Those men may take their mothers and fathers, their sisters or brothers, or their wives and children on a wonderful holiday while they rehabilitate themselves after the terrors of the Japanese prison camps, If this were clone for Australian ex-prisoners of war, would so many of them be in hospitals to-day? Even at this late stage the Government could decide to pay these men at least the subsistence allowance of 3s. a day which I have advocated for so long with the support of most Australians. By doing so, it could protect the health of many ex-prisoners who, in the words of the Minister for Repatriation, are “ beginning to break up “. If they were given an opportunity to take long vacations now, so that they might enjoy the amenities of which they were deprived for such a long time, they might be able to regain their lost strength and thus be able to face their return to civil life with confidence. ‘ I support the claim made by the honorable member for the Northern Territory. It is worthy and legitimate.

Question resolved in the affirmative.

page 1904


The following papers were presented : - :

Defence (Transitional Provisions) Act - National Security (Industrial Property) Regulations - Orders - Inventions and designs (109).

House adjourned at 3.34 p.m.

page 1904


The following answers to questions were circulated: -


Mr Ryan:

n asked the Minister for Immigration, upon notice -

  1. Is it a fact that certain of the migrants who reached Australia on the ship Misr are crippled ?
  2. What medical standard was set before they were granted permits to ensure that the migrants would be useful citizens?
  3. How many of those admitted are paralysed or otherwise physically disabled?
  4. Is it a fact that the quota of refugees has been increased beyond the original limit of 3,000?
  5. Is it a fact, as reported on the 23rd April, that 25 per centum of the accommodation in French ships scheduled for Australia has been reserved for refugees?
  6. Is it a fact that Australia has arranged with Great Britain to accept displaced persons in Britain as migrants; if so, how many will come hero and how will they be chosen?

Mr.Calwell. - The answers to the honorable member’s questions are as follows : -

  1. One migrant on theMisr was a cripple. The medical officer on the Misr regarded this boy as being above average intelligence and gave it as his opinion that with proper medical attention and the application of medical facilities available in Australia it would be reasonable to expect he would become a useful member of society. Refusal of this boy’s entry into Australia would have entailed his separation from the other members of his family which comprised the father already resident in Australia and his mother and three sisters who travelled with him. In these circumstances I accept full responsibility for the decision to permit him to land.
  2. Alien migrants are required to furnish to a British Consul satisfactory medical certificates in the prescribed form before their passports are visaged for travel to Australia. The form of medical certificate was drawn up after consultation with the Commonwealth health authorities. I will arrange for a copy of the form to be supplied for the information of the honorable member.
  3. There were twomigrants on the Misr who did not comply with the usual health standards. One was a Greek boy sixteen years old who was crippled, and the other was also a Greek who wassuffering from a form of neurasthenia. In both casesthey were members of a family coming to join a father permanently resident here. They were therefore permitted to land on compassionate grounds, subject to satisfactory full-time maintenance guarantees being furnished.
  4. I invite the honorable member’s attention to the statement made by me in the House in March, 1947, when I gave full particulars of the Government’s policy regarding refugees. I then pointed out that in accordance with the agreement made at the Evian Conference on behalf oftheLyons Government Australia wasbound toaccept 15,000 refugeesand displaced persons, that6,474 such persons had arrived up to 1945 when the Department of immigration was established, leaving 8,525 who couldbe admittedwithin the figures set by the agreement.
  5. The Department of Immigration has no control over the reservation of passages to Australia on overseas ships. It was, however, reported that efforts were being made to reserve available berths on foreign ships from European and Middle East ports for refugees and displaced persons. With a view to ensuring that every possible avenue was provided for British settlers and approved aliens outside the refugee classto come to Australia, I requested refugee organizations and shipping companies to limit passages to refugees to a maximum of 25 per cent. of the total accommodation on each foreign ship. All passages on shipssailing fromUnited Kingdom ports are reserved for returning Australians and British subjects in the United Kingdom.
  6. No.

Prices Control: Private Hospital Fees.

Mr Pollard:

d. - On the 22nd April, the honorable member for Franklin (Mr. Falkinder) askedwhether the Prices Commissioner had given directions to private hospitals in Tasmania and possibly elsewhere that have resulted in three increases in fees in the last six months and if so, what were the directions, what were the reasons for them, andwhat in-, creased fees were involved? I am informed by the Minister for Trade and Customs that increases in rates charged by private hospitals in Tasmania . had been approved by the Prices Commissioner. These increases variedbut ranged up to £2 2s. per weekand were in line with increases granted to private hospitals in mainland States. The increased rates were a consequence of the issue of a newState award for nurses and domestics, which, together with adjustments in the basic wage increased weekly wages by 8s. for domesticsand 26s. for nurses. Adjustments of a similar nature arising from the same causes have also been made in the rates charged for private wards in certain public hospitals.

ElectricityServices: Importationof Machinery.

Mr Chifley:

– On the 27th March, the honorable member forReid (Mr. Lang) asked a question concerningthe importation into Australia of some American diesel alternator sets as advertisedin the Sydney Morning Herald on Tuesday, the 25th March last. The Minister for Trade and Customs has supplied the following information : -

Approval was given on the 10thSeptember, 1946, for the importation fromthe United States of America of ten diesel alternator sets of 75 kilowatt capacity. However, prior to the granting of such approval, investigations made by officersof the Department of Tradeand Customs showed that - (a) therewas an essentialneed by industry for such equipment, particularly in view of the uncertainty of electricity supply; and (b) that comparable machines were not readily available from either Australianor United Kingdom sources of supply.

Each of the alternator sets to which the honorable member referred is supplied as a complete unit and incorporates a diesel engine of165 horse-power. Whereas some local manufacturers, including Standard Waygood Limited, of Sydney, were known to be interested in the manufacture of alternators only, they do not make the diesel engines which formportion of the complete equipment. Neither are diesel engines of the required horse-power manufactured by any other Australian company.

In view of the evidence obtained by the Department of Trade and Customs showing non-availability of 75 kilowatt diesel alternator sets from Australian or other “ sterling “ sources, it was decided, in accordance with Government policy in relation to “ capital “ equipment for industry, to permit the importation of ten machines from the United States of America and to make the necessary amount of dollar exchange available for the purchase.

Armed Forces: War Graves.

Mr White:

e asked the Minister forthe

Army, upon notice -

  1. Are the bodies of membersof the Australian Imperial Force who died in Borneo and were buried there in service cemeteries, being transferredelsewhere without relatives being consulted first?
  2. What is the reason for such transference?
  3. Did he promise- the honorable’ member for Balaclava in Parliament that this practice would be discontinued f
  4. Who is the official responsible for such policy being departed from ? ‘.
  5. Will he sec that’ no further re-interments will bc made without prior consultation with the relatives of the fallen?
Mr Chambers:
Minister for the Army · ADELAIDE, SOUTH AUSTRALIA · ALP

– The answers to the honorable members questions are as follows.: -

  1. No.
  2. Permanent war service cemeteries have been established iti Borneo,, as in the other theatres of war. and in establishing these permanent cemeteries the interests of next-of-kin and relatives is given first consideration to ensure accessibility by sea, land and air in districts where accommodation is likely to be available for the next-of-kin and relatives who may wish to visit the graves. At the present time working parties of the War Graves .Unit are operating in these areas with a view to locating the bodies of deceased personnel and concentrating burials in the permanent war cemeteries. For this reason re-burials in Borneo are being effected in the case of isolated graves in jungle areas, to ensure that inch graves are not lost by jungle growth and in order to provide for their future maintenance and upkeep in permanent cemeteries which will be handed over to the Imperial War Graves Commission when the work of the’ War Craves Unit in the area has been completed.
  3. lt was agreed that wherever possible therelatives would be notified of proposed reburials. See also answer to No. 5.
  4. The policy for the establishment of permanent war cemeteries throughout the various operational theatres of . war was laid down after the 1914-1S war by . the Imperial War Graves Commission and is still the accepted policy.
  5. On the discovery of an isolated grave by the War Graves Detachments operating in the various theatres of .war, action immediately proceeds to effect re-burial in the permanent war cemetery located in that area, and the next-of-kin are advised of this fact at the earliest possible date.

Cite as: Australia, House of Representatives, Debates, 2 May 1947, viewed 22 October 2017, <>.