Mr. Deputy Speaker (Mr. J. J. Clark) took the chair at 3 p.m., and read prayers.
Mr DEPUTY SPEAKER:
– I desire to inform the House that the Right Honorable Lord Fairfax, a member of the House of Lords, is within the precints of the House.With the concurrence of honorable members, I shall invite him to take a seat on the floor of the House beside the Speaker’s chair.
Lord Fairfax thereupon entered the chamber, and was seated accordingly.
Mr McLEOD: WANNON, VICTORIA
– Can the Minister for Commerce and Agriculture say what profits are held by the Australian Wool Realization Commission as Australia’s share of the operations of the joint organization set up to dispose of the wartime wool surplus? Is the Government taking any steps to provide for an interim distribution of profits, and if so, when may wool-growers expect the distribution to take place? When will the final distribution be made?
Mr POLLARD: Minister for Commerce and Agriculture · BALLAARAT, VICTORIA · ALP
– Australia’s share of the profits held by the Australian Wool Realization Commission is expected to amount to between £55,000,000 and £60,000,000, which was about the value of a normal prewar Australian clip. The Government, under the terms of the Wool Realization Act, has taken into consideration the financial position, and the Treasurer has agreed to an interim disbursal not exceeding £25,000,000. The act requires that the Australian Wool Realization Commission shall be consulted, and a letter of consultation has been despatched to the commission to-day. It is expected that a distribution of £25,000,000 can be made within the next two months. A final distribution of the remaining profits cannot be made until the scheme is wound up. A conference is to take place in London in January of next year to discuss the matter, and after that we shall be in a better position to fix upon a date for winding up. When a decision has been reached, we shall be able to indicate the additional amount which is to be distributed, and the approximate date of distribution.
Mr HARRISON: WENTWORTH, NEW SOUTH WALES
– Will the Prime
Minister inform the House of the total cost, entailed by the kiss bestowed by the Minister for Immigration upon the brow of the fifty-thousandth displaced person to arrive in Australia ? Will the right honorable gentleman itemize that cost and state from what source it will be met? Will he confirm or deny the reported statement by the master of the migrant vessel which brought the “ kissee “ that his ship was diverted to Fremantle on an order received while at sea and that this diversion was a factor in making the ministerial kiss a costly ceremony? On whose authority was the vessel diverted? Was the kiss inspired by Government policy or did the Minister act on his own initiative in the matter?
Mr CHIFLEY: Prime Minister · MACQUARIE, NEW SOUTH WALES · ALP
– My information with respect to the incident to which the honorable member has referred is that the total cost involved in the kiss bestowed by the Minister for Immigration upon a child refugee was the physical effort expended by the Minister in giving it. The vessel was not specially diverted for the purpose of meeting the Minister at Fremantle. That aspect of the matter has already been explained. In reply to the last part of the honorable gentleman’s question, I can only say that one’s action in kissing a person is simply a matter of personal favour and preference.
Mr SHEEHAN: COOK, NEW SOUTH WALES
– Is the Minister for Immigration prepared to make a statement about the recent deaths of immigrant children in this country?
Mr CALWELL: Minister for Immigration · MELBOURNE, VICTORIA · ALP
– I have a statement ready. I told some pressmen the other day that I would seek an opportunity to make a statement as soon as the House met. I propose to ask for leave to make the statement at about three minutes to 4 o’clock to-day.
Mr WHITE: BALACLAVA, VICTORIA
– I wish to ask the Minister for Immigration a question on unassisted British migration. To explain my question, I point out that some thousands of British people who are waiting to come to Australia cannot obtain nominators and others who would pay all their own expenses cannot obtain houses. The Minister may remember a proposal 1 made to him in writing and in the House about the need to cater for these people on a plan arranged between the Government of the United Kingdom and the Australian Government that would include housing. He will, of course, have had other proposals, too. Can he say whether any plan is being worked out so that these persons who wish to migrate to Australia will not be lost to us? Can he say whether accommodation, even of a temporary nature, could be provided as it is provided for displaced persons?
– It is perfectly true that the honorable member for Balaclava, and also other honorable members, have expressed concern from time to time at the inability of a number of people in Great Britain, who wish to come to Australia, to find nominators who can guarantee them accommodation in their own homes or such other accommodation as the State immigration authorities can accept. I, too, have been greatly concerned about this position, and I took advantage of the recent conference of Commonwealth and State Ministers to raise the matter, through the Prime Minister. The Premiers have agreed, in most cases, that there should be a joint Commonwealth-State scheme for building hostels to house the type of British migrant to whom the honorable gentleman has referred. We are awaiting replies from all the States. We shall go ahead as quickly as we can with the provision of hostels on much the same lines as those in which we are housing the new Australians, but, as I pointed out to the honorable member for Calare when he raised thi3 matter some little time ago, our difficulty with the British migrants is that we cannot tie them down for two years in the same way as we are able to tie down the new Australians and require them to work in a particular industry and live in a particular locality. We could do it of course - the authority to direct man-power is operating in England to-day - but we choose not to do it. The difficulty arises from the fact that some of the British migrants undoubtedly would take the accommodation that is offered to them and would leave within a few days or a week, and our plans would be considerably dislocated. The refusal of such people to stay where we want them to stay would complicate the housing problems of Australians, and, to that extent, could cause friction. We are trying to overcome all the difficulties because we do want to bring to Australia as many more British people, who cannot at present come here, as we possibly can get.
Mr CALWELL: Minister for Information and Minister for Immigration · Melbourne · ALP
– by leave - The deaths at Albury of twelve European child migrants, some of them from malnutrition, is a tragic reminder of the conditions of privation under which children are still forced to live in war-devastated Europe. If we need any further incentive to redouble our efforts to bring to Australia as many as possible of these innocent victims of the war’s cruel aftermath, these deaths would provide it. By bringing these children to Australia, we at least give them a chance first to live and then to grow hale and strong.Were we to leave them in Europe, we would condemn them to a. death rate very much higher than the incidence of deaths among those who have so far arrived in Australia.
The moment a European child migrant reaches Australia, he or she receives the best care which medical and nutritional science can provide. Once the children have entered a Commonwealth reception centre, malnutrition becomes merely a memory of a sad past except for the few whose condition has been too far advanced on arrival for the sufferer to respond to treatment. I am deeply concerned at the fate of these pitiable few and, in recent months, I have made the strongest possible representations to the International Refugee Organization.
Let it be clearly understood that the migrant from Europe becomes the responsibility of the Australian Government only from the time of arrival in Australia. The International Refugee Organization is responsible for the care and welfare of all European migrants from the time of their admission to a displaced persons’ camp in Europe until their arrival at an Australian port. In fact, the Commonwealth has no direct control over conditions on any migrant ships. Standards for accommodation and commissariat are laid down in the merchant shipping laws and regulations of the countries in which the ships are registered. On these are superimposed any special conditions required by the charterer, which in the case of the ships which brought these children to Australia is the International Refugee Organization. Policing of conditions is, therefore, the responsibility of the navigation authorities and the charterers. All that Australia can do is to request that certain standards be set and adhered to and this has been done in the strongest possible terms, not only in relation to the ships themselves, but also in respect of the camps in which migrants for Australia live prior to embarkation.
Earlier this year, I was disturbed by reports of conditions at International Refugee Organization embarkation centres in Naples and following representations dating back to January of this year, I caused the following telegram to be sent on the 30th March to Major-General Galleghan, head of the Australian Military Mission to Berlin : -
Your cable notifying the deaths of children at Naples coupled with reports being received by heads of families in Australia from dependants there indicate that conditions are far from satisfactory. Most damaging reports have emanated from Camp Capua. These depict conditions as deplorable.Will you please cable detailed report on conditions of all camps in which displaced personsen route to Australia are waiting also any action taken or to be taken by international Refugee Organization to improve conditions.
To this cable, Major-General Galleghan replied that the International Refugee Organization had sent an Australian member of its staff to investigate conditions at Camp Capua. This officer had reported that the deaths of the children had not been directly due to local conditions, although a lack of amenities and the fact that they were placed in an unheated camp had contributed to the trouble. Furthermore, the food in Naples was said to be strange to most of the displaced persons, particularly those from Poland and the Baltic States, and that sickness could be expected until they had adjusted themselves to the food. MajorGeneral Galleghan added that conditions in all the Naples staging camps were rapidly being improved by the International Refugee Organization. More recently, on the 11th July last, I addressed further strong representations to the International Refugee Organization through Major-General Galleghan for the special care and treatment both at embarkation centres and on shipboard of young children, particularly those showing preliminary signs of malnutrition.
As a result of my representations, improvements have been effected by the International Refugee Organization and have been reported to me by MajorGeneral Galleghan in a letter dated the 9th August, as follows: -
I took this matter up on a high level at Geneva and as a result Geneva had a conference of all the people concerned. I spoke to the Assistant Director-General responsible (Mr. Jacobsen) and impressed upon him the seriousness of the complaint and he has now advised me that as a result of the complaint a food supervisor has been appointed to the Naples area who will be responsible for diet, sanitation and hygiene in the various kitchens and dining halls of the two camps at Capua and Aversa. He also advised me that international nurses are being appointed to the various vessels, and in the case of vessels of large capacity there will be two international nurses. These will replace to a large extent the Italian nurses who have been employed, and the employment of whom has been the cause of complaint by me to the International Refugee Organization. It is further advised from Geneva that the Health Division there will Compile a full set of sanitary and hygiene instructions for use by the escort staff starting from the originating points for displaced persons in Germany and Austria covering the eating of tainted fruit and drinking of polluted water while en- route to Naples. This instruction will also cover the conduct of mothers Whilst in the staging areas and on board ships and will have special reference to those boats which flock around the ships at such ports as Port Said, Aden, and Colombo selling fruit which it would be much wiser not to allow children to eat. The International Refugee Organization has also guaranteed me that they Will ensure that the water in the tanks of the various vessels is tested at Naples before departure, and that water tanks are cleaned and re-cemented after every voyage. This was in reply to a suggestion by me as a result of troopships experience that water tanks are often the source of intestinal troubles.
I am quite satisfied that Geneva is seized with the seriousness of this complaint and are taking all possible remedial action . . .
Also as a result of these representations, Matron Constance Fall, principal matron for New South “Wales during the latter stages of the last war, and matron of the King George V. Hospital, Sydney, has left Europe for Australia on the International Refugee Organization ship Nelly, which is due to reach Australia in mid-September. Matron Fall will report fully on all aspects of the shipboard diet and medical care facilities for children on the voyage to Australia. In preliminary reports submitted by Matron Fall on conditions prior to embarkation, she indicated that catering at camps in Europe was satisfactory with the exception of one camp. The director of that camp was, as a result of Matron Fall’s report, replaced1 during August. In addition, recommendations submitted by her to the International Refugee Organization regarding care of mothers and children during train travel to staging camps, and in these camps, have also been put into operation by the International Refugee Organization. A further factor which contributed to the illness of children on arrival Ls referred to by Matron Fall in a preliminary report. A baby passenger in the ship Nelly, on which Matron Fall is travelling, died after two days at sea, and it is believed that the mother of the child concealed the fact that it was ill prior to embarkation in the fear that the family might miss the ship. This is a sufficiently pitiable commentary on the eagerness of these unfortunate people to get to Australia. Arrangements have now been made for all families to be lectured, in order that they may be assured that illness of children, whilst deferring embarkation on a particular vessel, will not bar them from subsequent embarkation.
In the light of this positive action on my part to improve conditions which are in no way Australia’s’ responsibility, it will be seen that there is no justification for the statement by the Sydney Daily Telegraph in its leading article on Monday that Australia might have contributed to the tragedy of the young children by its neglect to ensure that shipboard conditions were up to a reasonable standard. Once the migrant children are admitted to a Commonwealth reception centre, those of them who show signs of malnutrition become the special care of doctors, nurses and nutritionists who prescribe the best possible foods in medically desirable quantities. A diet chart for children in the different age groups has been compiled after exhaustive investigation by Dr. E. H. Hipsley, a distinguished nutritionist who is Acting Director of the Institute of Anatomy, Canberra. This diet chart, which admits of absolutely no limitation in its prescription of the best protective and body-building foods, ensures that the children receive milk, butter, cereals, eggs, fruit, meat, vegetables, fish liver oil, orange juice, tomato juice, broths of all descriptions, and so on.
All hospitals in Australia are short of staff, but the 200-bed hospital operated by the Commonwealth Department of Health which serves the immigrants at the Bonegilla Reception Centre is as well staffed as any Australian hospital, in the capital cities or elsewhere. The Bonegilla hospital has a professional staff of two Australian doctors and eight Australian nurses assisted by a nursing and domestic staff of over100 migrants, including six who were practising doctors in Europe and others with nursing experience. The conditions in our immigration centres have set a standard for the world. Members on both sides of the House and of both Houses of the Parliament who have visited these centres have been eulogistic in praise of them. Other leading public figures both from Australia and abroad have been most enthusiastic about the way in which the new arrivals are looked after in these former service camps and have been most complimentary in their comments on the methods adopted for the care and well-being of the migrants. Even the newspaper reporters who flocked to the Bonegilla Reception Centre at the week-end are unanimous that the migrants get the best possible food and plenty of it. Had the newspapers even the flimsiest reason for reporting otherwise, they would have done so because they normally show no disinclination to embarrass me or the Government.
Let me emphasize that the number of deaths of migrant children under two years of age is by no means high in the circumstances. The total number of deaths from all causes of European child migrants after arrival in Australia is nineteen out of a total of 2,029 children under the age of two years of age who have arrived. This represents a death rate of only 9.4 a thousand. It will be obvious, therefore, that despite the unfortunate start these children have in life, despite the lack of proper food and prenatal care for their mothers, despite the difficulties of providing appropriate diet and facilities for medical care in dis placed persons’ camps in Europe, despite the severe climatic conditions they face in their early life, often without proper clothing, and despite the undernourished condition in which some of them arrived in this country, we have been able to reduce the mortality rate amongst them to a remarkably low level. Thinking people, when they know the full facts surrounding the bringing of these children to Australia, will realize that, much as we regret that the best medical skill and attention available were unable to save their lives, we should remember rather those other children who, had it not been for the proper nourishment and care provided in Australia, would have perished in displaced persons’ camps in Europe instead of being as they now are, fine healthy children sharing with their Australian playmates the sunshine and plenty of this country. I should like to make it quite clear that it has never been and never will be the practice of out immigration selection teams in Europe to reject a family merely because a child showed signs of malnutrition. It may even happen that in the future other children who arrive here too late may die, but it will certainly happen that many children who would otherwise have died in Europe will find health and happiness in Australia. I lay on the table the following papers: -
Deaths of European Child Migrants - Ministerial Statement;
Report on the Deaths by the Medical Superintendent of Bonegilla Hospital ;
Letter, dated 5th September, 1949, to the Minister for Immigration from Major-General C. E. M. Lloyd, Chief of Australian and New Zealand Mission of the United Nations’ International Refugee Organization, and
Cablegrams from the International Refugee Organization to the Minister for Immigration and to Major-General Lloyd.
Major-General Lloyd, in his letter, disclaims any responsibility on the part of the Australian Government for the deaths from malnutrition of these unfortunate children with whose cases I have dealt. The international telegrams completely refute statements that either the International Refugee Organization or its officers or spokesmen have ascribed any blame to the Australian Government for the fact that these children have died. They also state that the International
Refugee Organization has decided, subject to our consent, that the summer crossings of the Red Sea, which intensify the arduous conditions of shipboard life and make illness more likely to occur among children, will be postponed for 60 days until cooler weather will enable .the children to be brought here with a greater prospect of their safe arrival in Australia. 1 move -
That the Ministerial statement be [printed.
Question resolved in the affirmative.
Mr DALY: MARTIN, NEW SOUTH WALES
– Is the Minister representing the Minister for Social Services in a position to advise the House of the reasons for the delay on the part of the High Court in delivering its judgment in the important case dealing with the Pharmaceutical Benefits Act?
Mr HOLLOWAY: Minister for Labour and National Service · MELBOURNE, VICTORIA · ALP
– The case to which the honorable member has referred arose out of the attack made by the British Medical Association and the Victorian State Government upon the validity of the Pharmaceutical Benefits Act. The case was heard early last month, and the hearing, which was commenced on the 12th August, was concluded quickly, for it lasted only two and one-half days. The Government naturally expected that the court might give its judgment by the end of that month. As the court has now gone to Western Australia, and may be dealing with other matters, I am not able to give the honorable member any idea when it is likely to announce its decision in the pharmaceutical benefits case. I understand that six justices heard that case and that each of them must give a separate decision. Consequently, we cannot expect the judgment until the slowest member of the court arrives at his decision. I shall ask the Attorney-General, if he thinks it proper, to do so, to approach the Chief Justice with a. view to obtaining an early decision.
Mr HAMILTON: SWAN, WESTERN AUSTRALIA
– Has the attention of the Minister for Commerce and Agriculture been drawn to a statement by Mr. H. Smith, General MacArthur’s food officer, that informal discussions had taken place regarding Japan becoming a party to the International Wheat Agreement? If so, has the Minister any information to give to the House regarding the matter? Has Australia been asked to indicate its attitude on the proposed participation of Japan in the agreement?
Mr POLLARD: ALP
– I have read in a press report the statement to which the honorable member has referred, but I have no official knowledge concerning it. Any application by Japan to become a party to the International Wheat Agreement, if it has been made, will be dealt with by the Wheat Council which has been set up under the terms of the agreement. I have no doubt that at the appropriate time the council will announce whether any such application has been made. It will also, no doubt, tell the world how it recommends that the application should be dealt with.
Commonwealth Assistance - -Butter
Mr FULLER: HUME, NEW SOUTH WALES
– I ask the Minister for Commerce and Agriculture whether the Government’s grant of £250,000 to promote greater efficiency in the dairying industry will be used to pay more experts and to enable the writing of more reports? Is it a fact that Government interference with the dairying industry and Government experts is preventing increased production of dairy products? Is the Minister aware that the Bank Officers’ Committee has implied in advertisements published in the newspapers that this is the case?
Mr POLLARD: ALP
– By accident my attention was drawn to the newspaper report to which the honorable member has referred. I was rather astonished to think that any body of men such as the Bank Officers’ Committee would dare to suggest that the State governments, or for that matter the dairy-farmers of Australia, would resent the Australian Government making available an amount of £250,000 annually for five years for the purpose of promoting efficiency in the dairying industry of this country. The expenditure of that money will not involve the employment of experts by the Australian Government. The money has been allotted to the States on the basis of their respective cow population. This year Victoria and New South Wales .will each receive £67,000, Queensland £68,000, Western Australia £17,000 and Tasmania £9,000. The money will be expended by the State Departments of Agriculture, which will employ experts who are already on their staffs. Probably they will recruit a few additional outside experts. I am sure that the dairy-farming community in the States I have mentioned will welcome the provision of this money and the additional work which its expenditure will make possible. The money will be expended oi. herd recording, sire surveys, increasing the efficiency of dairy-farmers, the provision of mobile units for extension work find the like. I am astonished to think that anybody should be so ill-informed a.t,o resent the making available of money for these purposes by the Australian Government. The ultimate result of this expenditure will be that the efficiency of the dairying industry will be improved and more butter and fats will become available to Great Britain. Eventually dairy-farmers will be able to lead much more enjoyable lives and dairy products will be produced at a more reasonable cost.
Mr ANTHONY: RICHMOND, NEW SOUTH WALES
– I direct a question to the Prime Minister. I have here an interesting little booklet entitled Digest of Decisions and Announcements and Important Speeches by the Prime Minister, No. 131. I refer to an announcement that was made by the Prime Minister on the 13th October, 1947, and reported on page 5 of the booklet. The right honorable gentleman stated that there would be a review of the prices of dairy products each year from April to June and that the price of butter would be adjusted according to the findings of the reviewing committee as from the 1st July of each year for a guaranteed period of five years. The committee recommended an increase of the price of butter by 3d. per lb., which should have been paid to the suppliers as from the 1st July last. When is it proposed to make that distribution to the dairy-farmers ? Can they expect that, like the wool cheque, it will be in two or three months’ time?
Mr CHIFLEY: ALP
– Quite a number of conferences have been held on the price of butter. The Minister for Commerce and Agriculture has just handed me a list of the conferences. On the 6th July there was one at Brisbane with the prices officers. Another was held at Brisbane on the 8th July with the prices ministers representing the .States. A special conference of departmental officers and the prices officers was held at Canberra on the 27th and 28th July. There was a further conference between the Premiers and myself on the 17th July. On the 25th August the departmental officers and the prices officers again conferred. So there has been no lack of conferences on the matter. The intimation that I have received from the Premiers is that the price of butter will receive further consideration from the prices ministers at an early date. I forget the precise date. The Premiers have given me an undertaking that the matter will bc cleared u>p at a reasonably early date. It is not the fault of the Australian Government that the increased price of butter recommended by the committee has not been paid. Discussions are still taking place.
Washington Conference: Australian Representation - Inducements to Investors
Mr ABBOTT: NEW ENGLAND, NEW SOUTH WALES
– Will the Prime Minister state whether the Canadian Ministers for Finance and External Affairs are representing the Canadian Government at the dollar talks which are to open at Washington to-day? Will the right honorable gentleman explain why the Australian Government is not to be represented at these talks at a ministerial level, and why the Australian Minister for External _ Affairs is not present with his Canadian colleague to support Australia’s case? If it is not considered necessary for an Australian Minister to be present, is it because the Government has given Sir Stafford Cripps an open authority to agree to whatever that gentleman likes, irrespective of whether or not it is in the interests of Australia?
Mr CHIFLEY: ALP
– The talks are to take place between representatives of the dollar countries, and of the United Kingdom as representing the sterling area.
– Is the United Kingdom a dollar country?
– The talks are to take place between representatives of dollar countries, and of the United Kingdom as the leader of the sterling area.
– Why is one dominion to be represented and not another?
– One of the reasons why Canada is to be represented is because that dominion is a dollar country. Sir Stafford Cripps has neither asked for nor has he been given a blank cheque in this matter. We understand and appreciate the difficulties which will confront him -and Mr. Bevan at these talks. It has been customary for the Canadian Government to direct the Canadian Minister for External Affairs, Mr. Pearson, to attend conferences on behalf of that dominion. It eather peculiar to find that when the Minister for External Affairs is absent from Australia honorable members opposite want to know why he is away; but when he is here they want to know why he is not elsewhere. The representatives of the United Kingdom, which controls the dollar resources of the sterling area, will take part in these talks on behalf of the sterling group. The discussions will take place with representatives of Canada, and the United States of America, the two countries directly associated with dollar currency.
Mr WILLIAMS: ROBERTSON, NEW SOUTH WALES
– In view of the desirability of taking a long-term view of the necessity for making dollars available to Australia in connexion with the development of this country, will the Prime Minister inform the House whether the Government holds out any inducement to people who desire to bring capital to Australia, or to establish manufacturing industries here? Is the Prime Minister prepared to examine personally any applications for import licences for machinery and plant which have already been refused by the Department of Trade and Customs on the ground that the dollar expenditure that would thereby be incurred is not warranted ?
– I assume that the honorable member for Robertson has referred to American companies which de sire either to enlarge their interests here or to transfer interests from America to this country. When such a position has arisen, I have generally been a party to discussions upon the application, because the proposal has very often involved the formation of companies or the provision of additional capital in an existing company. From that aspect alone, the matter would come to my notice, as a rule, through the Advisory Committee on Capital Issues. There are a number of difficulties in connexion with the importation of plant and machinery. Sometimes, the American interests consider that the plant should be paid for in dollars. At other times, American interests have been prepared to take shares, representing the capital equivalent of the plant, in the particular company with which they proposed to become associated. Indeed, some strong demands have been made in favour of allowing them to take shares for the capital equivalent of plant that i.s installed in an Australian company and to pay fairly substantial sums for what is known as the technical “ know-how “. I have not always looked upon such requests with great enthusiasm. The utmost assistance is given to every kind of industry that will produce essential and even non-essential goods, so long as it does not make a heavy drain on our dollar resources. -I am prepared to look at each particular case, and I think that it; is safe to say that 90 per cent, of the cases of any magnitude have been examined by me personally.
Mr HAYLEN: PARKES, NEW SOUTH WALES
– I ask the Minister for External Affairs whether it is a fact, as has been reported in a section of the press, that a petition has been forwarded to him for presentation to the Human Rights Commission of the United Nations. The petition is reported to concern the removal of certain Chinese aliens from Australia under recently enacted legislation. Has the matter any relationship to the Declaration of Human Rights, and is the Chinese Embassy associated in any way with the alleged petition?
– Is not the matter sub
Dr EVATT: Attorney-General · BARTON, NEW SOUTH WALES · ALP
– As the honorable member for New England has interjected, certain aspects of this question are before the High Court and I shall not deal with them. However, I think that I can answer the honorable member’s question by saying that no petition has been received by me and that I cannot imagine that the Chinese Embassy would be associated with it because it would be a. very irregular course to present a petition to the United Nations secretariat in the way that has been suggested in the press. Apart altogether from the legal constitutional questions that are before the court and about which I shall say nothing, there is no relationship between the Declaration of Human Eights, or any clause of it, that I am aware of and the exercise by a country of its national right, which has always been recognized in every country, to determine the composition of its own people.
ClearanceofCargoes - Ban on Dutch Vessels.
Mr FALKINDER: FRANKLIN, TASMANIA
– Will the Minister representing the Minister for Trade and Customs ask his colleague to have an investigation made into the excessive delays occasioned by the Department of Trade and Customs in the slow clearance of cargoes from oversea s and interstate ships in Australian ports to the firms to which the goods are consigned?
Mr POLLARD: ALP
– I shall be glad to refer the question to the Minister for Trade and Customs and will endeavour to obtain a prompt answer.
Mr BERNARD CORSER: WIDE BAY, QUEENSLAND
– Has the Prime Minister’s attention been drawnto recent newspaper reports that the federal council of the Waterside Workers Federation may decide next month to lift their ban on Dutch shipping? In. view of the fact that the ban has already resulted in a loss to Australia of £40,000,000 worth of trade with the Netherlands East Indies in the past four years, and is tantamount to the Government’s surrender of Australia’s foreign policy, will the right honorable gentleman inform the House why he has permitted continuing loss of government prestige?
Has the Australian Government yet been advised by the Communists when they may lift this shipping ban against a friendly nation ?
Mr CHIFLEY: ALP
– I presume that the honorable member is not referring to all Dutch shipping coming to Australia. At one time the Waterside Workers Federation imposed a ban on the unloading of ships of the Holland-Australia Line. That matter was dealt with and there is not now a ban applying to vessels of that line coming to Australia. Suggestions have been made by certain interested parties, about a ban on oil tankers plying from). Indonesia, particularly Sumatra, to Australia. In point of fact there has never been any interference with oil tankers coming from the Netherlands East Indies to Australia. They pass to and fro quite freely. Although there have been difficulties with relation to other shipping; coming to Australia from the Netherlands East Indies, the Government does not officially recognize that any ban has been placed on Dutch shipping in Australia. That matter may be overcome very quickly. As a result of the activities of the Good Offices Committee of the United Nations organization, on which Australia has a representative, I understand that the relationship between the Indonesians and the Dutch is now much better than it has been. The Good Offices Committee has succeeded in smoothing out many difficulties and there are hopes that others will be overcome very shortly.
Mr GEORGE LAWSON: BRISBANE, QUEENSLAND
– I ask the Minister for Labour and National Service how the labour market has adjusted itself since the great army of unemployed developed as a result of the recent coal strike? Will the employment of new Australian workers from overseas adversely affect the re-employment of Australians who may be still unemployed? What is the degree of unemployment in Queensland to-day?
Mr HOLLOWAY: ALP
– The labour market has not quite re-adjusted itself since the recent coal strike, but the figures show that it is rapidly getting back to normal. In the week preceding the strike, 920 people in Australia were drawing unemployment benefit, and, at the peak of the strike, there were 118,000 people drawing unemployment benefit. Last Saturday 3,670 people were drawing unemployment benefit. So, the position is rapidly getting back to what it was before the strike. The honorable member has asked whether the employment of Australian workers may be affected by the employment of new arrivals. The answer is that it will not be affected. There is a perfect understanding between the Department of Labour and National Service, the Department of Immigration and the employers’ and employees’ organizations that Australian workers will not be adversely affected by the employment of new arrivals. While Australian labour is available new labour from overseas cannot bp engaged. That undertaking was agreed to at the inauguration of our immigration policy. It has been faithfully carried out, and it will continue to be carried out. The honorable member may rest assured that we are employing new arrivals as quickly as possible in essential industries where they are most needed. We will continue to do that, but that will not adversely affect Australian workers. Queensland has more people temporarily unemployed than have the other States because there is much more seasonal work there. When the strike broke out 500 people in Queensland were drawing unemployment benefit. Their number jumped to 14,000 during the strike. The figure is now down to 650.
Mr.FRASER. - Will the Minister for
Commerce and Agriculture inform the House whether it is true that prior to the referendum on rents and prices the Government warned producers that six separate State governments could not satisfactorily administer prices control? Following the defeat of the referendum, was power to control the price of butter transferred to the State governments in terms of the undertaking given to the industry? If the State governments do not grant to the butter industry a price based on the cost of production, will the Commonwealth consider withholding from payments due to the States, from the 1st July, an amount sufficient to recoup to the butter producers the loss incurred by them on account of the failure of the State governments to do them justice?
Mr POLLARD: ALP
– It is true that prior to the recent referendum on rents and prices control the Australian people were informed that in the absence of an overall prices control authority the Australian Government would find it difficult, if not impossible, to continue to pay subsidies in relation to certain commodities. It is also true that following the defeat of that referendum complete control over prices was transferred to the State governments. The honorable gentleman has asked what the Australian Government will do in certain eventualities. I am hopeful that common sense will prevail. I am sure that every angle will be studied carefully before a decision is made, and I think that the decision that will bemade will be satisfactory to all concerned.
Mr FRANCIS: MORETON, QUEENSLAND
– My question relates to the decrease of the production of cotton in Queensland. In May, 1948, the Queensland Cotton Marketing Board presented a case to the Tariff Board for a guaranteed price of 32d. per lb. for raw cotton for a period of five years. The Tariff Board completed its report in May of this year. The delay in ensuring that cotton producers shall receive an adequate return for their products has, unfortunately, resulted in a serious decrease of cotton production. I ask the Minister representing the Minister for Trade and Customs whether the report of the Tariff Board can be considered by the Government without further delay and a decision regarding a guaranteed price for cotton expedited. The cotton planting season is about to begin, and if a favorable decision is not made soon only a very little cotton may be produced in Queensland in the new year.
Mr POLLARD: ALP
– I shall refer the matter to the Minister for Trade and Customs and ascertain the present position.
Mr LANG: REID, NEW SOUTH WALES
– I ask the Treasurer whether the printed budget papers were received at the Treasury offices in the State capitals of Australia on last Monday morning, prior to their consideration either by Cabinet or the Parliamentary Labour party?
Mr CHIFLEY: ALP
– The budget was dealt with by Cabinet some time ago. It has not been considered by Cabinet during this week. Some weeks ago Cabinet made decisions regarding recommendations to be made to the Parliamentary Labour party concerning the budget. Those recommendations were considered yesterday and endorsed by the party. It has always been the practice, after Cabinet has dealt with the matter, to forward to the State capitals copies of the budget papers and an outline of the budget speech, or, if possible, a copy of the speech itself, so that they can be made available in those cities for the benefit of the press. If the Parliamentary Labour party at its meeting yesterday had rejected the proposals that were put forward by Cabinet, the budget speech could not have been delivered this afternoon. I informed the leaders of both the Opposition parties that the budget speech might be made this afternoon. That was conditional upon the endorsement by the Parliamentary Labour party of the Cabinet’s proposals. It is true that the budget papers were sent to the capital cities of the States after the budget proposals had been considered by Cabinet. That is the usual practice. It was done for the convenience of the press.
SEWERAGE INSTALLATION AT ALICE SPRINGS
Report of Public Works Committee
– I present the report of the PublicWorks Committee on the following subject : -
Sewerage installation at Alice Springs.
Ordered to be printed.
Mrs BLACKBURN: BOURKE, VICTORIA
– I ask the Min ister representing the Minister for Social Services whether the rehabilitation of physically incapacitated persons under the social services legislation includes the provision of hearing aids, at least topersons on low incomes ? Does that legislation also cover the teaching of lip reading to those who require that service, and, if so, is the Government arranging for the training of the necessary teachers?
Mr HOLLOWAY: ALP
– The matter of supplying hearing aids to people on lower incomes was investigated by the Minister for Social Services when he was making inquiries overseas regarding the cheapest equipment available for that purpose. I am not sure whether a scheme for supplying those aids has actually been put into operation, but I shall discuss the matter with the Minister and give the honorable member a reply as soon as possible.
Mr RYAN: FLINDERS, VICTORIA
– Can the Minister representing the Minister for Health state whether, in view of the widespread public concern over the spread of poliomyelitis, or infantile paralysis, in Australia and abroad, the Government will assist the Governments of the States in measures to combat the disease? What facilities, if any, has the Government to conduct research on a national scale into this disease? Is it a fact that four years ago the New South Wales Government desired to establish a modern research unit costing £60,000 but abandoned the plan when it was discovered that that amount was insufficient, and that an additional sum of £190,000 would be required to establish an up-to-date institution of the kind desired? Will the Government consider giving assistance to the State authorities to establish research units to deal with this disease?
Mr HOLLOWAY: ALP
– I could answer portion of the honorable member’s question but I consider that it would be more to his advantage if he were to put it on the notice-paper. I shall meanwhile discuss the matter with the Minister for Health and obtain a full answer to the whole question.
Mr ADERMANN: MARANOA, QUEENSLAND
– As I understand that the present contract price for pig meats supplied to the United Kingdom has practically expired, can the Minister for Commerce and Agriculture inform the House whether any decisions have been finalized between the Australian Government and the British Ministry of
Food regarding the new contract. If so, what price has been agreed upon?
Mr POLLARD: ALP
– The Australian Meat Board recently forwarded to the Australian Government its recommendations regarding the prices that it considered fit and proper for Australian meat producers to receive from the United Kingdom under the terms of contracts to be reviewed as from the 1st October. The Government has considered those recommendations and has conveyed to the United Kingdom Government its requests regarding the review of the price. A public statement will be made as soon as a decision on price levels is reached by the United Kingdom Government and the Australian Government.
Mr HOWSE: CALARE, NEW SOUTH WALES
– During the parliamentary recess I asked the Minister for Repatriation whether he would consider the use of the Lapstone Hotel, which the Government has acquired, for the treatment of war neurosis cases. Is the Minister yet in a position to say whether a final decision has been reached on that matter ?
Mr CHIFLEY: ALP
– I shall answer the question which relates to the use of the Lapstone Hotel which, as the honorable member has mentioned, has been acquired by the Australian Government. The present arrangements are that the Lapstone Hotel building will be used as the head-quarters of the Royal Australian Air Force, Eastern Command, which will be transferred from Bradfield Park, Sydney. This will release accommodation at Bradfield Park, which will be made available partly to the New SouthWales Ministry of Housing, and partly to immigration authorities to provide additional accommodation for immigrants arriving in New SouthWales. It will not be possible, therefore, for the Lapstone Hotel to be used for the purpose that the honorable member has mentioned. The Minister for Repatriation may have some other proposals regarding that matter, and in any event I shall mention to him the matter that the honorable member has raised.
GOVERNMENT HOSTEL, DARWIN
Report of Public Works Committee
– I present the report of the Public Works Committee on the following subject: -
The erection of a hostel for officers at Darwin, Northern Territory.
Ordered to be printed.
Reports on Items.
Mr POLLARD: ALP
– I lay on the table reports of the Tariff Board on the following subjects : -
Fuel Injection Equipment
Motor Vehicle Bodies and Pressed Metal Panels
Cooking Stoves and Cooking Ranges
Ordered to be printed.
Mr BEALE: PARRAMATTA, NEW SOUTH WALES
– I wish to ask a question of the Minister representing the PostmasterGeneral. I have received a letter from the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia enclosing a copy of two broadcast scripts which were banned by the broadcasting authorities. They were offered by the Queensland Branch of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia in furtherance of its anti-Communist campaign for August and September, and they were refused for broadcasting under section 89 (3) of the Australian Broadcasting Act, which prohibits the dramatization of political matter. By way of further explanation–
Mr DEPUTY SPEAKER:
– I think the honorable member has explained enough. He should now ask his question.
– Has the Minister seen the script of the two broadcasts? Is he aware that they are in simple and straightforward terms, that they are not in dramatized form, that they are set out in the form of a dialogue between two persons named “.Ted “ and “ Bill “ who discuss the merits and demerits of communism ?
Mr DEPUTY SPEAKER:
– The honorable member should ask his question.
– Has the Minister seen the scripts, and can he justify the grounds on which permission to broadcast them was refused?
Mr DEPUTY SPEAKER:
– The latter, part of the honorable member’s question is out of order. The Minister is not called upon, in answer to a question, to justify anything.
– Is the Minister aware that the two scripts referred to have been banned under section 89 (3) of the Australian Broadcasting Act? Does he agree with the banning of the scripts, and is he aware of the grounds on which they were banned ?
Mr CALWELL: ALP
– This matter affects the administration of my colleague the Postmaster-General. I have seen some reference in the press to the scripts mentioned, and I have myself received a letter on the subject. I sha.ll ask the Postmaster-General to prepare a report on the matter, which I hope to be able to supply to the honorable member at an early date. I take it from what the honorable member has said that, in his view, there was no dramatization of the scripts because there were to be only two voices, those of “ Ted “ and “ Bill “.
– That is also the opinion of Mr. Fanning, the chairman of the Australian Broadcasting Control Board.
– I can see no reason why the scripts should be rejected because they provided for the use of the voices of two men called “ Ted “ and “ Bill There might be a difficulty if they were “Howard” and “Percy”.
Mr HOLT: FAWKNER, VICTORIA
– I direct a question without notice to the Attorney-General about the raid which was made a few weeks ago by Commonwealth officers on Marx House, Sydney. Will the Minister inform the House of the purpose of the raid? Can he tell honorable members anything of the results obtained, and what action, if any, the Government proposes to take as a result of the investigations?
Dr EVATT: ALP
– The primary purpose of the raid was to ascertain whether the Communist party was committing a breach of the National Emergency (Coal Strike) Act, which this Parliament passed during the last sessional period. The information which was obtained by the security officers was used in the Arbitration Court, and was instrumental in obtaining important orders against the Communist party of Australia regarding the payment of certain moneys into court, which orders were immediately obeyed by the Communist party. In the course of the raid, certain other information was, not unnaturally, obtained. Responsibility for the internal security of Australia rests in the first instance upon the DirectorGeneral of Security, Mr. Justice Reed. His officers have examined the documents obtained during the raid, but it would be obviously contrary to the public interest to indicate what information has been obtained. Indeed, it is so obvious thar all honorable members will agree that such a rule, upon which the Director.General absolutely insists, must be strictly observed.
– Has the attent N of the Prime Minister been directed to a, San Francisco newspaper report, dated 1Sth August last, of a statement by the Australian Ambassador to the United States, Mr. Makin, that there was no heavy Communist influence in most Australian unions, and that industrial disturbances had been negligible in recent years? Was the statement made on the authority, or with the concurrence, of the Australian Government? If so, was Mr. Makin advised that Australia had just passed through a general coal strike of seven week’s duration, which the Prime Minister and the Premier of New South Wales had publicly described as a Communist conspiracy? If the Australian Ambassador to the United States was not so advised, will the Prime Minister state why he was not apprised of the latest Australian developments?
Mr CHIFLEY: ALP
– I have not seen in any San Francisco newspaper a report of any statement made by the Australian Ambassador in Washington. Probably, His Excellency the Ambassador was speaking in general terms about the industrial position in Australia. He was certainly not given any indication by me of the statements he should make. He is quite capable of attending to such matters himself. I regard the honorable member’s inquiry as a purely propaganda question, and therefore I do not propose to discuss it any further.
– In view of the recent denunciation of the Communists by Commonwealth Ministers and their knowledge that the ban on Dutch shipping was the work of the Australian and Indonesian Communists and has cost Australia millions of pounds worth of trade, can the Minister for External Affairs, now that he is not going overseas, report progress with respect to any action the Government has taken or intends to take to end this sabotage?
– I do not know whether the honorable member was in the chamber at the time, but a similar question was asked earlier by the honorable member for Wide Bay and was answered by the Prime Minister.
PAPUA AND NEW GUINEA
Mr TURNBULL: WIMMERA, VICTORIA
– Can the Minister for External Territories say whether the Legislative Council for Papua and New Guinea has yet been officially set up? Are the members of this council, with the exception of three missionaries, required to take the oath of allegiance, which is not to be confused with the oath of office ?
Mr WARD: Minister for External Territories · EAST SYDNEY, NEW SOUTH WALES · ALP
– The council has not yet been officially established, but it will be established at an early date. The answer to the latter part of the honorable member’s queston is, “ Yes “.
LEGAL SERVICE BUREAU
– Has the AttorneyGeneral received a communication from the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia stating that they have heard that legal aid to ex-servicemen, hitherto provided by the Attorney-General’s Department, is to be discontinued? Is it intended to discontinue this service?
Dr EVATT: ALP
– There is no substance whatever in the report. Indeed, the contrary is the fact. During the seven or eight years of the existence of the Legal. Service Bureau which gives legal advice to ex-servicemen and their dependants, thu number of advisings in the six States has been almost 1,000,000. Far from contracting its activities, we are coming to the conclusion that we shall have to extend them in some respects.
We are considering whether it would be advisable to provide for the giving of advice to members of the public who believe that they are entitled to Commonwealth social service benefits.
LAND SETTLEMENT OF EX-SERVICEMEN
Mr ARCHIE CAMERON: Postmaster-General · BARKER, SOUTH AUSTRALIA · ALP
– Can the Minister for Post-war Reconstruction prepare a statement disclosing whether it is a fact that, under Commonwealth law, a lessee of a soldier settler’s block is not allowed to bequeath that- lease to either his widow or children? Will the Minister lay upon the table a copy of the leases being issued to ex-service personnel in each of the States and the Territories?
Mr DEDMAN: Minister for Defence · CORIO, VICTORIA · ALP
– I shall give consideration to the honorable member’s request.
High Court Action against Mr. R. E. Fitzpatrick.
– In view of the fact, as reported in the press, that the Minister for External Affairs does not intend to attend the next conference of that “ white elephant “ called the United Nations organization, will he now have time to inquire into the matter relating to the aerodrome at Bankstown and which affects one Fitzpatrick? The Minister promised me during the last sessional period that he would supply me with a report on the subject. Can I expect to receive a report on that matter during this sessional period ?
Dr EVATT: ALP
– The honorable member’s sarcasm is not strong, and his wit is no sweeter. If he had understood the information which I furnished to him during the last sessional period he would have learned from the facts supplied therein by my officers exactly where the litigation to which he refers stood. The matter which was decided in one part against Fitzpatrick and in another part in his favour, is in the hands of the High Court and it must be dealt with by the court.
– Increased postal charges have been made by the PostmasterGeneral’s Department. Will the
Minister representing the PostmasterGeneral ask his colleague to overprint all forms, such as telegram forms and the like, to show the new charges and thus end the confusion which now exists regarding the new rates ?
Mr CALWELL: ALP
– I shall ask the Postmaster-General to give consideration to the honorable member’s request and to furnish me with a reply which I shall deliver to the honorable member at an early date.
BILLS RETURNED FROM THE SENATE
The following bills were returned from the Senate: -
Without requests -
Supplementary Appropriation Bill 1947- 48.
Without amendment -
Supplementary Appropriation (Works and Buildings) Bill 1947-48.
ASSENT TO BILLS
Assent to the following bills reported : -
Snowy Mountains Hydro-Electric Power Bill 1949.
Pharmaceutical Benefits Bill (No. 2) 1949.
Genocide Convention Bill 1949.
Commonwealth Conciliation and Arbitration Bill 1949.
Liquid Fuel (Defence Stocks) Bill 1949.
Cockatoo and Schnapper Islands Bill 1949.
Immigration Bill 1949.
War-time Refugees Removal Bill 1949.
Whaling Industry Bill 1949.
Census and Statistics Bill 1949.
Post and Telegraph Bill 1949.
Lighthouses Bill 1949.
Defence Forces Retirement Benefits Bill 1949.
Australian Soldiers’ Repatriation Bill 1949.
Stevedoring Industry Bill 1949.
Supplementary Appropriation Bill 1947-48.
Supplementary Appropriation (Works and Buildings) Bill 1947-48.
Messages from the Governor-General reported transmitting Estimates of Revenue and Expenditure and Estimates of Expenditure for Additions, New Works, and Other Services involving Capital Expenditure, for the year ending the 30th June, 1950, and recommending appropriations accordingly.
Ordered to be printed, and referred to the Committee of Supply forthwith.
In Committee of Supply:
Mr CHIFLEY: Prime Minister and Treasurer · Macquarie · ALP
– I have the privilege of presenting estimates of revenue and expenditure for 1949-50, and details of actual revenue and expenditure in 1948-49.
In 1948-49, for the second time since the war ended, it was possible to balance the Commonwealth budget. All expenditure, excluding advances to the States for housing, was met from revenue, and, in addition, substantial sums were set aside in the National Welfare Fund and the War Gratuity Reserve.
This result marks a great improvement in the national finances under post-war conditions - an improvement which can be measured by comparison with 1944-45, the last full financial year of the war period. In that year revenue fell short of expenditure by £266,000,000, which had to be borrowed. In the four years since then -
Tax reductions have been made which, on present income levels, would be valued at £280,000,000 per annum ;
Large outstanding war accounts, including the lend-lease settlement, have been met; £108,000,000 has been provided for repatriation and re-establishment of ex-service men and women ; £184,000,000 has been found for interest and sinking fund on debt arising from the war;
Gifts totalling £35,000,000 have been made to the United Kingdom;
Contributions worth £30,000,000 have been made for the relief of war-distressed peoples ;
Social service expenditure has been increased from £39,000,000 a year to £81,000,000 a year and the National Welfare Fund has been built up to nearly £100,000,000. Social service expenditure this year is estimated at £100,000,000;
Annual payments to the States have been increased from £48,000,000 a year to £79,000,000 a year. With proposals to be made in this budget, payments to the States in 1949-50 would be £101,000,000; £132,000,000 has been paid in subsidies to keep down the cost of living and to assist primary producers ;
A post-war defence programme to cost £295,000,000 has been pushed forward and great national works have been undertaken in the fields of the post office, civ il aviation and power development.
Whilst the budget has encompassed all these measures, the huge war-time gap between revenue and expenditure has been closed and in the past two financial years no borrowing for current purposes has been necessary.
Australia has been aided in these years by good seasons, and export prices have been high because of the strong post-war demand for our products abroad. The national income has increased and that increase has been widely shared. Imports have flowed in strongly during the past three years, adding to local supplies of goods. But the main key to this post-war financial achievement - as to many others - has been, I believe, that throughout the whole period full employment of labour has been maintained.
Consistently, every available worker has had a job, every new worker has found a job, and the total number of wage and salary earners in work has risen rapidly. In June this year it was 75,000 above June last year and 720,000 above June, 1939. These basic facts, far more than anything else, explain why we have been able to throw off the burdens of war, reduce taxes, increase production, improve social services and find the way to our present strong financial position.
Revenue and Expenditure, 1948-49
During 1948-49 national income is estimated to have increased by £200,000,000, and wage and salary payments by £150,000,000. Exports rose by £140,000,000 and imports by £76,000,000.
Detailed estimates of national income and expenditure in 1948-49 are contained in a separate paper which is being circulated with the budget papers.
As in the previous year, budget estimates of revenue in 1948-49 allowed for some rise in employment, incomes and trade, but not for as much as occurred.
Total revenue for the year, excluding self-balancing items, was £535,000,000, which was £42,000,000 above the estimates. The main increases were -
Income tax and social services contribution - £26,000,000. This was due to the rise in wages, salaries and other incomes being greater than expected and to further overtaking of arrears in income tax assessments.
Customs and excise- £11,000,000. The rise in imports was greater than estimated and there was also a substantial increase in sales of beer and spirits.
Pay-roll tax- £1,800,000. This reflected the exceptional increase in wage and salary payments.
On the expenditure side defence and post-war charges in 1948-49 were £196,000,000, which was £3,000,000 below estimates.
Expenditure on defence and allied services showed a small increase over the budget estimates. Pay and allowances of the forces were substantially greater than estimated mainly as a result of the increase in service rates of pay granted in November last year and the settlement of pay accounts of personnel discharged. Navy expenditure was also greater than estimated mainly because of payments to the United Kingdom in respect of the aircraft carriers and associated equipment. As against these increases, however, expenditure on army supplies was less than expected and defence research and development expenditure, although increasing at a rapid rate during the year, was below the estimate.
Post-war charges of £117,000,000 in 1948-49 were £6,000,000 below budget estimates. Expenditure on war service land settlement and on reconstruction training was below the estimates by £2,700,000 and £2,800,000 respectively. On the other hand, subsidies on imported goods discontinued last year were greater than estimated, largely because of an extension of the time during which goods on ship were eligible for subsidy.
Total credits offset against defence and post-war charges were £3,400,000 above estimates.
Expenditure other than ‘defence and pest-war -charges exceeded the budget estimate by £2 ,
Tor reasons already -discussed -the amount transferred to the National Welfare Fund on account of social service contribution and pay-roll tax was £ !8,000,:0TO -greater than tire ‘estimate.
Post ‘Office expenditure of £f9,9O0,’0’0!0 on ordinary services was £5,200,000 greater tiran the estimates, increased wages, salaries, and cost of materials being mainly responsible.
Expenditure on post office works was £2,000,08® above estimates. On other capital works and servies it was £3,000,000 lower than was estimated.
Details of revenue and expenditure in 1948-49 compared with the budget estimates, are contained in Statement No. 1. In addition, the main items of aggregate war expenditure to the 30th June. 1949, are set out in Statement No. 5.
Loan Transactions. 1948-49
During the year, loans raised in. Australia for State works programmes, Commonwealth advances to the States for housing, and redemption of unconverted securities resulted in cash subscriptions amounting to £127,598,780. In addition, conversion operations were undertaken to deal with maturing securities amounting in all to £161,825,775, which became due in September and October, 1948, and April, 1949. The total amount converted was £111,018,805. The holders of securities not converted were paid off from cash subscriptions to the loans. Three and one-eighth per cent, securities for eleven to fourteen years were offered for both loans, and 2 per cent, securities for threeyears were, in addition, offered in the April operation.
Conversion operations were also undertaken in London to deal with maturing loans and loans over which options of redemption were available. The total amount o’f these Joans which represented debts of the ‘Commonwealth and States was £58,7’4’9’908. Securities amounting to £15,’76”3,7.21were paid off and the balance of ‘£#2;9-86,i’87 was converted into 3 per cent, securities. Of the amount paid off £1,318,556 was redeemed from the National Debt Sinking Fund1 and £14,445,165 was transferred to Australia with the assistance of the Commonwealth Batik.
Details of loan transactions are given in Statement No. 6.
Incomes, Prices and Employment, 1949-50
Expansion of employment and production, rising export prices and the upward thrust of internal prices, wages and general costs which followed, upon the relaxation of war-time controls, have combined during the past three years to cause a great increase in total community incomes.
The market for wool appears to be still very strong but wheat prices have fallen back from the peak reached sixteen months ago. Prices of metals have also receded and exports of manufactures are meeting keener competition abroad than formerly. Prices of most other major exports are determined under long-term contracts. In all, it seems likely that export income will be lower this year than in 1948-49 but it will still be relatively high.
Wages and internal prices have risen rapidly during the past two years and will probably go further in 1949-50. Some rise in these factors was inevitable under post-war conditions when demand’ for goods has increased so much faster than supplies could possibly have done. The Government, however, has always recognized the difficulties to which excessive and cumulative price and cost increases could give rise and’ it has done its utmost to avoid such increases, partly by direct controls so long as these were available and partly by general monetary and financial measures.
Shortages of coal and steel and of certain classes of labour have retarded production in a. number of industries and these difficulties have been accentuated sharply - although, I believe, temporarily - by the recent coal strike. Nevertheless the underlying drive for industrial expansion continues and its fruits are seen in a greater volume and variety of goods available to the public. Imports, of course, have also brought increased supplies.
Experience in many countries during recent years should warn us that the course of economic affairs can change suddenly and unpredictably. I shall review again presently the special problem of international payments, which has great significance for Australia. Transcending even this, however, is the question whether levels of employment and incomes can be maintained in major countries abroad, because it is these factors which, fundamentally, determine world production, prices and trade. This year some falling away in business activity has occurred in the United States and its effects have already been felt in other countries. We must profoundly hope that this movement will soon be reversed because conditions in the United States, the greatest of industrial countries, have enormous importance for the world1.
Again, it would be wrong to ignore the difficulties to which developments within our own economy could lead. Some industries, encouraged by the buoyant conditions of recent years, may tend to develop capacity too great for prospective demand.
Nevertheless, our external position has been strengthened by reducing the burden of overseas debts, accumulating London funds, and securing long-term contracts for a number of our exports. Within Australia, industry has been greatly diversified, business and farm debts have been reduced, interest fates kept down and the national finances brought to a sound position. These are valuable safeguards against adversity, from whatever source it may arise.
MIGRATION and Development.
Security, higher living standards and the attainment of an ampler national life all depend upon whether we can bring our indisputable wealth of resources into greater productive use. There are two main conditions to fulfil. One is that development should proceed along systematic lines, with governments and in- dustry co-operating. Another is that we should have a population large enough to make the best use of our resources.
To an increasing degree, now that the tasks of war have been put behind us, the Government is directing its- energies to undertakings which will provide th basis for future expansion of our economy. These undertakings lie in the fields of power development, water supply, aviation, land transport, and the search for minerals, which are pre-requisites for progress under the new techniques of our age. They extend also to the opening up of pastoral and agricultural areas.
The Snowy Mountains power scheme, for which legislation has been passed this year, will be the greatest single project so far undertaken in Australia. It aims to provide large blocks of electric power for defence purposes and to conserve water for irrigation purposes in the valleys of the Murray and Murrumbidgee Rivers.
In Western Australia, the Commonwealth is sharing with the State Government the cost of a plan to reticulate water to certain areas in the north-eastern portion of the main mixed wheat and sheep belt.
The Commonwealth has plans for encouraging the development of the cattle industry in Northern Australia, and so increasing the availability of meat for export to the United Kingdom. The Government is collaborating with the Governments of Queensland and Western Australia in the provision of improved transport facilities and water supplies for this purpose. On present estimates these plans will cost the Commonwealth about £4,500,000.
Discussions have been held with the Queensland Government on three other major projects. One envisages the use of the waters of the Burdekin River for irrigation and the generation of electricity. Under a second scheme the Barron and Walsh rivers would be used for irrigation purposes. A third project would provide railway facilities for the Callide open-cut coal mine, and make additional, supplies of coal available for all States, particularly the southern States.
These are examples of individual projects to bring the latent wealth of this country into fruitful economic use. At the same time, great programmes of work are going forward in the fields of the Post Office and civil aviation, where modern facilities can do so much to improve the general efficiency of our industrial life.
Meanwhile, the Government is tackling the population problem on a scale never attempted before. Under its migration programme it is expected that some 220,000 financially assisted new settlers will have landed in Australia by the 30th J une next year, and of these some 130,000 will be available for employment. Thereafter, the numbers will increase year by year. Indeed, now that shipping difficulties are being overcome, the only limits to the programme are those set by availability of suitable people from overseas and the capacity of our economy to absorb them. The programme will not be accomplished without difficulties and financial costs. The Government, however, is prepared to meet those difficulties and costs because, in its view, they will be far outweighed by the gains to be made from a steady increase in our population.
Already the benefits of immigration have appeared in a higher output of industries formerly under-staffed and a faster rate of progress in building and other constructional projects. Key services such as hospitals have also gained relief from pressing shortages. Steadily the stream of new citizens and workers will broaden out to reach all branches of’ the economy.
Progress in developmental works and immigration will open the way for the growth of private industry. Progress in these fields together will secure increasing markets for the products of industry, so that the whole economy can go forward. That in itself will afford the best assurance of steady full employment and rising living standards. It will also enlarge the foundations of our defensive strength which, in the troubled world conditions of to-day, must rank amongst our foremost national objectives.
International Trade and Payments
In most countries of Western Europe during the past year production, trade and industrial capacity have increased, although some countries have done better than others. The United Kingdom achievement has been notable indeed. Its industrial output rose during the year by 7 per cent, and the volume of exports by 9 per cent. In the last half of 1948 its external earnings and payments actually balanced whereas in the year before there had been a gap of £630,000,000 sterling.
Notwithstanding these gains, however, an acute crisis exists to-day in the sphere of international trade and payments. A number of countries are taking further measures to curtail spending of dollars and other scarce currencies. The gold and dollar reserves of the United Kingdom have fallen sharply in recent months and are now considerably below the level regarded as a safe minimum.
In essentials, the exchange problem has not altered. Although producing more than in earlier post-war years, many countries are still unable to earn sufficient dollars to pay for the goods they need from the United States, Canada and other dollar sources. They have borrowed where possible, sold investments and spent reserves; but beyond these resources and the special aid they are receiving from the United States, they are forced to do without dollar goods, even of essential kinds. Similar problems exist on a smaller scale with regard to Belgian and Swiss francs and certain other currencies.
The Marshal] plan envisages an attack on this problem extending over four years. Through dollar grants and loans, the participating countries are enabled to obtain goods for industry and reconstruction over and above those they can buy from dollar resources of their own. It is a condition of receiving this aid that they shall do their utmost to help themselves and one another.
Under the plan valuable progress has been made by the countries concerned and this can be expected to continue. But special difficulties have arisen. Although they have more goods to export, participating countries have not been able to sell as much as they had hoped, either’ direct to the dollar area or to countries which can pay in dollars. The position has beeen worsened by the business recession in the United States, which has made selling there more difficult, and in particular by smaller earnings from Bales of raw materials, such as wool, cocoa, rubber and tin from which dollars, are normally obtained.
The United Kingdom, which has led the way in post-war recovery and has itself given substantial aid to countries iri. Europe and elsewhere, has felt the full impact of these developments so that, despite great progress in its overall trade position, its dollar position in the past few months has seriously deteriorated. Both the value and the volume of its sales to dollar countries have fallen and so, too, have sales of certain raw materials from the colonies which are an important source of earnings for the dollar pool.
When these adverse changes had become apparent, the Prime Minister of the United Kingdom, Mr. Attlee, invited Ministers from the sterling area countries of the British Commonwealth and from Canada, to attend a conference in London in July at which the position would be reviewed. Following this invitation but before the conference, there were discussions in which United Kingdom and Canadian Ministers and the Secretary to the United States Treasury. Mr. Snyder, had a part.
At the London conference, where Australia was represented by the Minister for Defence and Minister for Post-war Reconstruction (Mr. Dedman), longterm aspects of the problem were considered and agreement was reached as to major objectives which should be pursued. In particular it was thought that the central aim of all countries should be the achievement of a pattern of world trade in which the dollar and non-dollar countries should be able to operate within a single multilateral system, and that the strength and stability of sterling as an international currency should be a major goal.
The conference also considered the immediate problem of stopping the drain on the gold and dollar reserves of the United Kingdom which are the central reserves for the whole sterling area. The United Kingdom Government had previously announced its intention to cut expenditure on dollar imports in 1949-50 by 25 per cent, as compared with the 1948 level. Representatives of the other sterling area countries agreed to recommend to their respective governments action designed to achieve comparable results.
At the time of the conference, it had been arranged that further discussionsbetween representatives of the United. Kingdom, Canadian and United States Governments would take place in Washington during September. Those discussions have begun and are expected to cover the main problems of financial relationships between the three countries taking part.
It will be clear that, apart from longerterm considerations, the issues being discussed in Washington have a critical present importance. Further restriction of imports, whilst necessary to check the fall in gold and dollar reserves, obviously cannot be carried beyond certain limits without causing grave dislocation to industries and standards of living in the countries concerned. In any case, it can of itself contribute nothing to the solution of the dollar problem which requires a positive effort to lift levels of trade rather than to reduce them.
The Government has decided to adopt the recommendations of the London conference and, as already announced, has reduced allocations of licences in theSeptember quarter for imports of goods from the dollar area. The aim is to reduce dollar expenditure on imports to- 75 per cent, of the 194S level as quickly as possible. This means that there will have to be a substantial reduction in dollar expenditure by government departments as well as cuts in practically all the major categories of commercial dollarimports. Dollar imports were already severely restricted in 1948. The reductions in the ‘September quarter were thelargest which could be applied immediately without causing severe disruption, in Australian industries.
But the full 25 per cent, saving in dollar import expenditure will not be possible of achievement in 1949-50’ because of the commitment represented by outstanding licences. Australia must play its full part in avoiding a furtherdrain, on. the limited gold and dollar reserves of the United Kingdom and the Government is examining the possibilities of borrowing as a means to provide additional dollars. The Government recognizes that this course may present difficulties. Generally, it has been averse to increasing the long-term dollar commitments of Australia. There are various possible sources of dollar borrowing, and the matter will be decided in the light of all the circumstances.
Proprosed Grant to the United Kingdom.
It has been remarked earlier that whilst most countries in Western Europe had increased production and trade last year, some had done better than others. This unevenness in the rate of recovery as between European countries creates problems having much in common with the general dollar problem, though on a smaller scale. Some countries cannot earn enough by trade with other countries to buy from them the goods they require, even when those goods are available. As a result, productive effort will be wasted and aid received from abroad will fall short of its purpose unless means can be found to remove these difficulties of payment between such countries.
As a counter-part to Marshall aid, a system of intra-European payments was -established last year with the object of providing funds by which European countries could within limits buy from their neighbours more goods than their own earnings would cover.
It is proposed that, with modifications, this scheme will be continued in the current year, in which case the United Kingdom will again make large contributions in sterling. This is because sterling, which is the means of buying goods not only in Great Britain but throughout the whole sterling area, is for many countries a very scarce currency. The United Kingdom, as honorable members know, has during the post-war years given very large financial aid to countries in Europe and1 this has helped them considerably to restore their industries and trade.
Australia has a large trade with Western Europe and, since trade improves with general economic activity, it follows that Australia has benefited from the aid given by the United Kingdom to Western Europe and that we stand’ to gain from any further improvement there.
In view therefore of the further contributions which the United Kingdom will this year make to European revival and as a measure of assistance to the United
Kingdom in its own great efforts, the Government has decided to make a further grant of £10,000,000 to the United Kingdom Government. The payment will be made from balances held by the Commonwealth Bank in London and repayment will be made to the bank in Australia from Consolidated Revenue. Legislation will be brought down for this purpose at a later stage in this session.
Financial Prospects, 1949-50
Because incomes and trade have increased so steeply in the past three years and because substantial arrears of income tax assessments have been overtaken, revenue has continued to rise notwithstanding the heavy reductions made in rates of taxation.
These conditions, however, must in large part be regarded as temporary. Total incomes will probably rise further in the current year, but not as fast as recently. Tax arrears will again contribute to revenue this year but not so much as last year and before long they will be reduced to normal. At the same time the full effect of reductions in taxation rates will be reflected in revenue.
On the other hand, the current rise in prices and costs is likely to continue for some time yet and will cause further increases in expenditure, particularly in the Post Office, railways and works, but also in most other branches of administration. The necessity of importing materials in short supply here will also in many cases add to costs.
Since, therefore, proposals affecting revenue and expenditure extend beyond the present into future years, often with progressively increasing effects, the considerations just cited must be kept prominently in view at a time like the present. Because at all stages since the war the economic outlook has been liable to rapid change, the Government has consistently refused’ to embark upon financial measures that were not clearly practicable and for which the resources were not in sight. Whilst adhering to this policy, the Government has still been able to achieve a great deal in the financial field, as the earlier review has shown. It would be wrong if passing circumstances were allowed at this stage to induce a departure from that policy.
Defence and Wak SERVICES, 1949-50.
In the Estimates this year items relating to services and commitments arising out of the recent war are grouped under the heading “War and Repatriation (1939-45) Services and will henceforth be treated on the same basis as War and Repatriation (1914-18). The heading Poet-war Charges will not in future be used. Expenditure on the post-war defence plan is shown under the heading Defence Services.
On the basis of existing commitments, net expenditure on Defence and War (1939-45) Services is estimated at £154,000,000 as compared with £195,600,000 in 1948-49. The latter figure included an amount of £17,000,000 transferred from trust fund balances.
Provision is made for gross expenditure of £640,000,000 on Defence Services as compared with £61,000,000 in 1948-49 and for War and Repatriation (1939-45) Services of £101,000,000, as compared with £149,000,000 in 1948-49. Credits in 1949-50 are estimated at £11,000,000 as against £14,400,000 in 1948-49. Full details of Defence and War (1939-45) Services are contained in Statement No.” 4.
Expenditure on Defence Services this year is estimated at £60,000,000, of which £9,000,000 is expected to be spent overseas.
The five-year defence programme, which extends over the financial years 1947-48 to 1951-52, is progressing satisfactorily. The total cost of the programme was originally estimated at £250,000,000. This figure has now been increased to £295,000,000 as a result of rising costs and certain changes which have been found necessary since the plans were first formulated.
Naval aviation is now firmly established in the Royal Australian Navy. The first aircraft-carrier, H.M.A.S. Sydney, has joined the fleet as a fully operational’ unit. A naval air station as a hase from which the carrier will operate has been established in New South Wales.
It is expected that the first destroyer under the post-war programme will be completed by the end of 1949 and the second during 1950.
Army estimates for 1949-50 are based on an average strength of 15,000 full-time military duty personnel and a Citizen Military Force of an average strength of 23,000. The strength of the Australian Military Forces in the British Commonwealth Occupation Force in Japan has been reduced to proportions commensurate with the smaller commitment required under stabilized conditions. From army personnel returned to Australia during the past twelve months, a Regular Army Brigade Group has been formed.
Developments in the Royal Australian Air Force in 1948-49 included the establishment of a school of land/air warfare and also a staff college for the training of career officers for the Royal Australian Air Force. All Royal Australian Air Force units have their full complement of aircraft and will carry out operational and training flying to the maximum extent possible. Satisfactory progress is being made with the local manufacture of aircraft and engines already provided for in the defence programme. In “addition, work is proceeding on the production of prototypes of certain new types of aircraft. Proposals for the manufacture in Australia of new types of jet-propelled fighter and bomber aircraft are now under consideration.
At the Naval and Air bases at Manns, construction work is well advanced and personnel have been posted by both Services.
An amount of £6,000,000 has been included in the Estimates for expenditure on defence research and development. Of this the greater part relates to the longrange weapons project. Satisfactory results have been achieved in assembling appropriate equipment at Salisbury and in recruiting scientific staff. Accommodation has been a limiting factor but current plans for housing of personnel engaged in the project should overcome this difficulty. Considerable progress has been made in developing the range and technical areas at Woomera and concurrently with this work, buildings, services and amenities in the village area have gone forward. A shortage of materials and certain types of supervisory and skilled labour as well as surveyors has resulted in some slowing up of the planned building and constructional works. However, trials as planned are proceeding on the interim missile range, concurrently with construction on the main range.
Pay of the Forces.
The pay code for the defence forces, which was introduced in July, 1947, provided basic rates of pay for members of the permanent forces having regard to civilian rates then ruling. In light of changes in civilian rates, the basic rates were varied in November last year to provide for an increase of 2s. a day in the overall remuneration of the forces.
A further review of the pay code is now being made and, whilst full details of the increases have not yet been worked out, they will be completed in time for the new scales to operate from the commencement of the first full pay period in October, 1949. An amount of £1,000,000 has been included in the Estimates on this account.
War and Repatriation (1939-45) Services
On the basis of existing commitments, expenditure on War (1939-45) Services is estimated at £101,000,000. Expenditure last year, which included the United Kingdom grant of £10,000,000, was £149,000,000.
An estimated increase of £970,000 in war pensions this year reflects the operation for a full year of the increase in pension rates made last September.
Expenditure on reconstruction training is expected to decrease by £2,600,000 in 1949-50 as compared with 1948-49 because the number of trainees is falling off.
On the other hand, estimated expenditure on war service land settlement is £800,000 above the amount spent in 1948-49. Greater contributions towards the writing down of capital value of holdings are expected and, with more settlers in occupation, provision is made for increased expenditure on living allowances.
Price stabilization subsidies in 1949-50 are expected to cost £6,700,000, which includes £5,500,000 for subsidy on tea and £1,200,000 for outstanding claims in respect of subsidies discontinued last year.
The estimate of primary production subsidies this year is £9,700,000, which includes provision of £5,600,000 for sub sidies on dairy products, £3,600,000 for superphosphate subsidy and £500,000 for subsidy on nitrogenous fertilizer. Details of price stabilization and primary production subsidies are contained inStatements Nos. 8 and 9.
Provision of £1,300,000 is made for international relief and rehabilitation, which includes £450,000 for post-Unrra expenditure and £850,000 for the third Australian contribution to the International Refugee Organization.
On the basis of existing legislation and commitments, total expenditure other than Defence and War (1939-45) Services is estimated at £387,000,000 in 1949-50 as compared with £339,000,000 in 1948-49.
The major increases are £11,000,000 in payments to the National Welfare Fund, £13,600,000 in payments to the States and £15,700,000 in capital works and services.
Statutory payments to the National Welfare Fund in 1949-50 are estimated at £121,000,000, of which £99,000,000 is from social services contribution and £22,000,000 from pay-roll tax, as compared with £110,000,000 in 1948-49.
Expenditure from the fund, on the other hand, is estimated at £100,400,000, as against £80,800,000 last year. The main increases are -
The increase in pensions and child endowment payments is due in part to normal growth in numbers of beneficiaries and in part to the operation for a full year of the increased rates which came into effect last year. The estimate of unemployment and sickness benefits is larger because of the coal strike.
Details of the National Welfare Fund are contained in Statement No. 7 and of Commonwealth social and health services in Statement No. 11.
Special Grants to States
The report of the Commonwealth
Grants Commission for 1949-50 has not yet .been received, but an amount of £11,000,000 has been included in the Estimates for special grants to South Australia, Western Australia and Tasmania.
Capital Works and Services
Expenditure on capital works and services, excluding defence works, is estimated to increase from £37,500,000 in 1948-49 to £53,200,000 in 1949-50. Major increases are -
Additional labour and increasing deliveries of plant and equipment have been making possible a higher rate of progress in works programmes which, howover, will now be retarded by the coal strike. Construction costs are rising because of higher wages and costs of materials.
The Government is maintaining its efforts to ensure the utmost economy and efficiency in administration. Staffing and organization of departments is under continuous review by the Public Service Board and special instructions have been issued to all branches of the Public Service that expenditure of all kinds must be kept to a minimum. With wages, salaries and costs of materials rising and with expansion of vital activities such as the Post Office, civil aviation and works, some increase in the numbers of staff and in the genera] costs of government is inevitable.
Total Expenditure, 1949-50
On the basis of existing legislation and commitments total expenditure in 1949-50 is estimated at £541,300,000 as compared with actual expenditure of £535,000,000 in 1948-49.
Estimated Revenue, 1949-50
It is estimated that revenue in 1949-50 will be £532,600,000 after taking into account the reduction in rates of income tax and social services contribution which came into operation on the 1st July of this year.
Allowing, however, for a substantial increase in incomes and profits subject to taxation, revenue from these two taxes is estimated at £2-76,000,000 compared1 with revenue of £272,000,000 in 1948-49.
At existing rates, revenue from salestax is estimated at £40,000,000. This is £1,000,000 higher than last year.
Revenue from pay-roll tax in 1949-501 is estimated at £22,000,000, an increase of £2,000,000 above 1948-49.
Revenue from customs is estimated to be slightly lower on existing rates than in 1948-49. There may be some increase in total imports, though mainly in free or low duty classes of goods. On the other hand, dollar imports, some of which carry high rates of duty, will be lower.
Estimated excise revenue for 1949-501 is set down at £64,000,000 as comparedwith £62,700,000 in 1948-49.
Post Office revenue will reflect therecent increases in postal, telegraph and’ telephone rates and is estimated to be- £5.000,000 higher than last year.
Accordingly, on the basis of estimates’ which do not allow for proposals affecting both revenue and expenditure, which will be detailed presently, revenue for 1949-50 will fall short of expenditure- by £9,000,000.
In March last, substantial reductions were made in the rates at which incometax and social services contribution arepayable by individuals for this financial year. The rates were reduced prior tothe 1st July, 1949, so that the benefit of the reductions would be reflected in theinstalments deducted from salaries and’ wages as from that date.
The total cost to revenue of the reductions is estimated at £36,500,000 perannum, which amounts to approximately 23 per cent, of the total direct taxation payable by individuals. This will beoffset to some extent, however, by thecollection of arrears. During the financial year 1948-49, arrears in the assessment and collection of income tax and social’ services contribution were largely overtaken and it is expected that, by thu end of this financial year, the arrears will’ be reduced to a normal level.
There have now been five major reductions in rates of direct taxation since the- war ended, besides a large number of particular concessions and their effect has been to lighten the weight of taxation upon individuals very greatly. The majority of taxpayers now pay considerably less than half the taxes which would have been payable at war-time rates on comparable incomes and a very large number of people pay no income : tax at all.
As an assistance in the re-equipment of industry and in the establishment of new industrial enterprises, the income tax depreciation allowances are being extended. At present, a special initial depreciation deduction of 20 per cent. of the cost of plant and machinery acquired or installed up to the 30th J une, 1950, is allowed in the year of acquisition or installation. This special deduction is additional to the normal annual allowance for depreciation. It is proposed to extend the period of the special allowance for a further two years to the 30th June, 1952. At the same time, companies and other taxpayers are being given a right to elect to deduct initial depreciation of 40 per cent. in lieu of the present 20 per cent. on plant and machinery acquired or installed after the 30th June, 1949.
It is proposed also to extend the income tax concessional rebate in respect of life assurance premiums and superannuation contributions by individuals. At present, £100 is the maximum amount on which the rebate is allowed. As from the 1st July, 1949, this maximum is being increased to £150.
In the field of indirect taxation the Government proposes to make certain concessions which will now be outlined.
It is proposed to reduce the general rate of sales tax from 10 per cent. to 81/3 per cent. This reduction will apply to a very wide range of goods in general use and “will thus operate to the benefit of the whole community. Certain new exemptions will also be granted, and the tax on some goods will be reduced from the maximum rate of 25 per cent. to the new general rate of 81/3 per cent. This new rate will be relatively simple to calculate as it will represent1d. for each 1s. of taxable value. Detailsof the amendments will be found in the bills to be introduced later this evening. The cost to revenue of these concessions is estimated at £6,700,000 for a full year and £5,000,000 for the current financial year.
It is proposed to reduce the rates of entertainments tax by approximately 20 per cent. in regard to all classes of entertainments. Details of the reductions will be announced when the relevant bill is introduced later this evening. The resultant loss of revenue is estimated at £1,100,000 for a full year and approximately £800,000 for the current financial year.
Customs, Excise and Primage
The following remissions are pro posed : -
Primage. - Removal from some 400 items and sub-items, mainly raw materials, semi-manufactured goods and industrial equipment. Cost to revenue is estimated at £1,000,000 in a full year and at £820,000 in 1949-50.
Outside Packages. - Abolition of customs duty and primage. Cost to revenue is estimated at £450,000 in a full year and at £385,000 in 1949-50.
Passengers Baggage. - Remission of duty on articles for personal use or gifts to a total value of £30 with a limitation on spirituous liquors and tobacco. Articles above a total value of £30 will be charged a flat rate of 25 per cent. ad valorem. Cost to revenue is estimated at £30,000 in a full year and at £25,000 in 1949-50.
Ships’ Stores. - Abolition of customs duty and sales tax on stores other than spirituous liquors and tobacco. Cost to revenue is estimated at £120,000 in a fullyear and at £100,000 in 1949-50.
Aircraft Stores. - Exemption from customs duty of stores used on aircraft trading overseas. The concession will extend to nonAustralian aircraft where Australian aircraft receive reciprocal treatment. Estimated cost to revenue is £100,000 in a full year and £83,000 in 1949-50.
Radio Valves. - Reduction of excise by1s. a valve. Cost to revenue is estimated at £100,000 in a full year and £87,000 in 1949-50.
Full details of these concessions will be announced later this evening by the Minister representing the Minister for Trade and Customs.
Total Tax Reductions
In all, therefore, the proposed additional tax concessions will cost revenue £9,600,000 in a full year and £7,300,000 in 1949-50. Taking into account the reductions in rates of direct taxation estimated to cost £36,500,000 a year the full cost to revenue of tax concessions coming into operation in 1949-50 would thus be approximately £46,000,000 per annum.
Payments to the States.
Proposals will be made for payment to the States this year of a coal strike emergency grant of £8,000,000 and an increase in the Commonwealth Aid Roads and Works Grant of £1,000,000 a year. In addition, provision is made in the Estimates for an increase in the States Tax Reimbursement Grant of £8,750,000, an increase of £3,500,000 in special grants, and a further payment this year to reimburse the States for costs of administering controls over prices, rents and land sales. Taking account of these items, the main details of which will be given presently, aggregate payments to or for the States in 1949-50 will be approximately £101,000,000 - an increase of £22,500,000 above payments last year and £34,000,000 above 1947-48.
Tax Reimbursement Grants
It is expected that under the formula embodied in existing legislation the tax reimbursement grants payable to the States in 1949-50 under the uniform tax scheme will amount to £62,500,000, an increase of about £8,750,000 over 1948-49. This will mean a total increase of no less than £17,500,000 in the tax reimbursement grants since 1947-48.
Coal Strike Emergency Grant
In recent months, a very heavy burden has been placed on State budgets by reason of the coal strike, coal shortages and associated effects. The adverse effect of the coal situation on State budgets has been particularly noticeable in the finances of the State railways and certain other State business undertakings.
At the recent conference of Commonwealth and State Ministers the Commonwealth was furnished with estimates of the effects of the coal situation on State budgets, and after considering all circumstances, the Government has decided that a special coal strike emergency grant of £8,000,000 should be made to the States in 1949-50. This grant will be distributed among the States in the same proportions as the tax reimbursement grant payable this year. Legislation to give effect to this proposal will be introduced shortly.
Commonwealth Aid Roads Grant
It is also proposed to increase by £1,000,000 the amount made available to the States under the Commonwealth Aid Roads and Works Act 1947-48 for expenditure on roads in sparsely settled areas. This will increase the amount to be provided for that purpose in 1949-50 to £3,000,000 and the estimated total roads grant to £9,000,000. Legislation will be introduced to make the necessary amendment to the act.
Controls over Prices, Rents and Land Sales
Last year, legislation was passed pro viding for the States to be reimbursed by the Commonwealth for additional expenditure incurred by the States in 1948- 49 by reason of their assumption of control over prices, rents and land sales. The Government has decided that this arrangement should be continued in 1949- 50. New legislation will be necessary. Last year, grants to the States in reimbursement of the cost of these controls amounted to £597,000 whilst £800,000 has been provided for this purpose in the budget this year.
Further details of payments to the States are given in Statement No. 10.
War Gratuity Reserve
During last financial year, as honor able members know, the War Gratuity Reserve was established as a provision against the payment of war gratuity due in the financial year 1950-51.
At the 30th June this year the balance in the reserve was approximately £30,100,000. As the total liability for war gratuity is estimated at £80,000,000 which will mainly fall due for payment in 1950-51, the Government considers that further provision should as far as possible be made in this financial year.
Accordingly, it is proposed that part of the balances in certain trust accounts built up through provision against certain war-time contingencies, such as the Diverted Cargoes Account and the “War Damage Fund, and which are no longer required for their original purpose, should be appropriated to the “War Gratuity Reserve. The total amount involved is £6,700,000, which would bring the balance in the reserve to £36,800,000.
Taking into account the revenue and expenditure proposals just outlined the budget for 1949-50 may be summarized as follows: -
Details of the revenue estimates for 1949-50 compared with actual revenue in 1948-49 and allowing for the proposed reductions in taxation are contained in Statement No. 2. Also, details of the expenditure estimates for 1949-50, compared with actual expenditure for 1948-49, and including new expenditure proposals, are contained in Statement No. 3.
Loan Council. Programmes 1949-50
At its meeting in August this year, the Loan Council endorsed a works programme for the Commonwealth and the States of £116,887,000.
The borrowing programmes approved by the Loan Council for 1949-50 total £79,300,000 to cover loan expenditure by governments, mainly on public works and housing. The Commonwealth’s share of this amount is £13,100,000, which will be used wholly for advances to the States under the Commonwealth-State Housing Agreement. The Loan Council also approved a total borrowing programme’ of £45,000,000 for semi-governmental and local authorities. All the borrowingsapproved are subject to review in January, 1950.
The past ten years have proved the resilient strength of our country. When faced with danger, we put forth a military and industrial effort far greater than formerly thought possible and since thewar we have been able, despite many difficulties arising from that conflict, to recover lost ground and advance along the road of progress again. Indeed, Australia is in many ways much fartherahead than ten years ago. In manufacturing, our capacity has increased at least 50 per cent. Throughout the economy asa whole there are 40 per cent, more peopleat work than there were then. From a social standpoint we have greatly extended the range and value of services availableand experience has shown not merely that we can afford these services but that they have a positive worth in keeping updemand for goods and hence employment and investment.
These examples of constructive achievement in a time disordered by war and theeffects of war point to what can be done under normal conditions. Knowing our resources, we should not be afraid to set our goals high. I believe for examplethat our population can be doubled within a few decades. I believe also that our present problems of fuel and power can be solved, so opening up immense industrial possibilities. Housing, again, difficult though it has been in recent years,, will be steadily overcome if we keep upour efforts.
But it is a condition of all this that we should accept as a common aim the future greatness and security of Australia and as a common responsibility that it rests with us in our own generation to. do our utmost to achieve these things.
STATEMENT No. 4.- DEFENCE SERVICES AND WAR AND REPATRIATION (1939-45)