House of Representatives
12 October 1950

19^th Parliament · 1^st Session

QUESTION
- BURDEKIN VALLEY DEVELOPMENT
QUESTION
- ARUP AND BRUHN PROPRIETARY LIMITED
QUESTION
- CAPITAL ISSUES
QUESTION
- IRON AND STEEL
QUESTION
- TEXTILES
QUESTION
- SULPHUR
QUESTION
- BRICKS
QUESTION
- COMPULSORY ACQUISITION OF PROPERTY
QUESTION
- DOLLAR LOAN
QUESTION
- DRIED -FRUITS
QUESTION
- PHARMACEUTICAL BENEFITS
QUESTION
- MUNITIONS ESTABLISHMENTS
HOUSING
QUESTION
- BROADCASTING
QUESTION
- HEALTH AND MEDICAL SERVICES
QUESTION
- CANBERRA
QUESTION
- BASIC WAGE
QUESTION
- ALUMINIUM
QUESTION
- CIVIL AVIATION
QUESTION
- HONEY
QUESTION
- PENSIONS
QUESTION
- TUBERCULOSIS
QUESTION
- COAL
QUESTION
- AUSTRALIAN PRISONERS OF WAR
COMMONWEALTH GRANTS COMMISSION
- Seventeenth Report
LEAVE OF ABSENCE
BASIC WAGE
TELEVISION
- Formal Motion for Adjournment
QUESTION
- INTERNATIONAL AFFAIRS
ESTIMATES 1950-51
QUESTION
- BUDGET 1950-51
BUDGET PAPERS
- National Income and Expenditure 1949-50
SUSPENSION OF STANDING ORDERS
SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) BILL 1950
- Second Reading
WOOL SALES DEDUCTION (ADMINISTRATION) BILL 1950
SUPPLY BILL (No. 2) 1950-51
- Second Reading
SUPPLY (WORKS AND SERVICES) BILL (No 2) 1950-51
- Second Reading
LOAN (HOUSING) BILL 1950
WAR PENSIONS APPROPRIATION BILL 1950
- Second Reading
STATES GRANTS BILL 1950
- Second Reading
STATES GRANTS (ADDITIONAL TAX REIMBURSEMENT) BILL 1950
- Second Reading
LOAN BILL 1950
- Second Reading
ADJOURNMENT
- Miners Pensions - Kashmir Dispute - 1939-45 War - Department of Social Services - Canberra Community Hospital
PAPERS
ANSWERS TO QUESTIONS
- Cockatoo Island Dockyard

COMPULSORY ACQUISITION OF PROPERTY

Mr RYAN:
FLINDERS, VICTORIA

– I ask the Minister for the Army whether, in view of the shortage of accommodation on the Mornington Peninsular, it was unavoidable that the Army had to acquire Mount Martha House, which accommodates 150 guests? What was the price paid for that property? What price was paid for the furniture and fittings? Is it a fact that they have been declared for disposal? Is it a fact that Whitehall Guest House at Sorrento, which the Army acquired some time ago, is not being utilized? For what purposes were these properties acquired?

Mr FRANCIS:
Minister for the Army · MORETON, QUEENSLAND · LP

Mr BEALE:
LP

– The Government is continuing with civilian production in its munitions factories where this does not interfere with defence production. Work has diminished in some factories but has been maintained, or perhaps a little increased, in other factories according to the type of work for which the factories ure equipped. The Government intends to continue to handle civilian orders to the degree to which it will be necessary to maintain staffs and keep the establishments going on an economic basis. Orders that would compete with private industry are not taken. The goods that ure produced in Government factories are being manufactured at the request of private industries and for their assistance at costs that are competitive with the costs of similar goods produced elsewhere in Australia.

page 711

HOUSING

Mr CLAREY:
BENDIGO, VICTORIA

– Will the Minister for Works and Housing supply me with the following information: - (1) Tho number of pre-fabricated houses ordered by the Australian Government to the 30th September last; (2) the number of such bouses actually landed in Australia; (3) number of prefabricated houses ordered been erected and the districts in which they have been erected ; (4) the total value of (a) the houses actually ordered, (7;) the houses landed and erected, and (c) the houses landed but not erected.

Mr CASEY:
LP

– As the honorable member’s inquiry requires a number of precise answers, I ask him to be good enough to regard it as being on the notice-paper and I shall obtain all the information that ho seeks.

page 711

QUESTION

BROADCASTING

Mr EGGINS:
LYNE, NEW SOUTH WALES

– I direct a question to the Postmaster-General concerning th’:’ need for an improved national broadcasting service in the north coastal region of

New South Wales. Can the Minister tell the House when it is expected that the new national broadcasting station, thu establishment of which has been authorized by the Government, is likely to be constructed?

Mr ANTHONY:
CP

– There is a considerable need for an improvement of broadcasting facilities on the coastal regions of New South Wales. Both the north coastal and the south coastal areas of New South Wales ure considered by radio technicians to be amongst the worst reception areas in Australia. I visited the Kempsey district some time ago and inspected the site that had been selected for a broadcasting station there because considerable opposition had been raised by local citizens to the acquisition by the Commonwealth of about 40 acres of flat land for the purpose of erecting a regional transmitter. Then seems to be a common though erroneous belief that a broadcasting station should be erected on a hill top. One of the principal requirements of a transmitter is a solid “ earth “. Therefore, a station should be erected where there is a considerable amount of damp ground. In many instances, large quantities of copper matting have to be laid through the damp ground in order to provide the required “ earth “. Requirements for television broadcasting, of course, differ in some respects. After visiting Kempsey, I took the matter up with the Australian Broadcasting Control Board and arranged for engineers to make a further inspection of the proposed site and hear the objection* of local residents so that the board could decide whether the site should be confirmed or whether a new site should be chosen. I understand that the board confirmed its original decision, and the obstacles having now been removed, the erection of the station can proceed.

page 711

QUESTION

HEALTH AND MEDICAL SERVICES

Mr FITZGERALD:
PHILLIP, NEW SOUTH WALES

– Can the Minister for Health say whether the Government favours the action which the British Medical Association proposes to take to cancel its agreement with the combined friendly societies, especially as the British Medical Association is not now providing doctors for lodge patients? If the Government does not favour this action, will it intervene to assist friendly societies to overcome the threatened injustice which will cause tremendous anxiety to a large number of pensioners, sick people and working men and women who have been lodge patients for many years? Alternatively, will the Minister introduce a scheme to provide adequate medical facilities for people in need of them?

Sir EARLE PAGE:
CP

– The honorable member may be interested to learn that both the friendly societies and the British Medical Association are anxious that any differences between them should not interfere with the Government’s health scheme.

page 712

QUESTION

CANBERRA

Dr NOTT:

– I direct a question to the Minister for the Interior or the Minister for Works and Housing, whoever feels the most guilty about the matter that I shall mention. The roads throughout the Australian Capital Territory are in a worse condition now than they were 25 years ago, and. I should like to know whether any long-range policy is being implemented to place them in a serviceable condition ?

Mr McBRIDE:
WAKEFIELD, SOUTH AUSTRALIA · LP; LCL from 1951; LP from 1954

– I am aware of the bad condition of some of the roads in the Australian Capital Territory, and action is being taken to remedy the defects. However, I point out to the honorable member that the drain on personnel and equipment is severe, and it is obvious that many of the defects will not be overcome for some considerable period.

page 712

QUESTION

BASIC WAGE

Mr CALWELL:
MELBOURNE, VICTORIA

– In view of the rumour that the basic wage will be increased by £1 a week by the Commonwealth Arbitration Court, will the Treasurer say whether he intends to proceed with his intention to present the budget this evening, or will he withhold it in order to redraft it for the seventh time?

Mr FADDEN:
CP

– In reply to the honorable member’s question, I merely say that the budget is not founded on rumour.

page 712

QUESTION

ALUMINIUM

Mr TOWNLEY:
DENISON, TASMANIA

– Can the Minister for Supply furnish any information to the House concerning the aluminium project at Bell Bay, Tasmania? When will the project be introduced, and how much aluminium will be produced there?

Mr BEALE:
LP

– This matter has been raised previously by both the honorable member for Denison and the honorable member for Bass. Some construction work has been completed and certain machinery has been delivered to the site. More material has been ordered, and arrangments have been made for the provision of a water supply and railway connexion. The Australian Government’s part of the programme is proceeding according to plan and, subject to electrical power -being made available, which is the responsibility of the Tasmanian. Government, aluminium should be produced by 1952. Some difficulties are associated with the electricity side of the undertaking, and I hope to have discussions with the Premier of Tasmania on this aspect at an early date. It is intended that approximately 13,000 tons of aluminium ingot shall be produced annually at Bell Bay, and that production would correspond roughly to our present rate of consumption. However, the consumption of aluminium is increasing and will probably amount to 20,000 tons annually in a few years. Plenty of bauxite is available.

Mr Treloar:

– Where?

Mr BEALE:

– In Australia. I know that the honorable member for Gwydir will suggest that there is bauxite in the Inverell district. .That is so, and it is also available in Tasmania and elsewhere.

page 712

QUESTION

CIVIL AVIATION

Mr DRAKEFORD:
MARIBYRNONG, VICTORIA

– Can the Minister for Civil Aviation say whether, it is intended to alter the existing wellestablished route flown by Qantas Empire Airways between Sydney and London in order to include calls at Melbourne and Perth, and returning via Djakarta, which will have the effect of extending the length of the route each way by approximately 400 miles? If so, will the Minister indicate whether there ha? been any decrease of passenger and other bookings on the Qantas Empire Airways and British Overseas Airways Corporation parallel service, and the reason for any such decrease?

Mr WHITE:
Minister for Air · BALACLAVA, VICTORIA · LP

– The answer to the first question is “ No”, and the answer to the second question is “ See answer to question No. 1 “.

page 713

QUESTION

HONEY

Mr JEFF BATE:
MACARTHUR, NEW SOUTH WALES

– I direct to the Treasurer a question concerning temporary financial assistance to the honey industry. Honorable members know that this country is now flowing with milk and honey. Is the right honorable gentleman aware that the honey industry has helped itself more than any any other industry has helped itself; that it has provided from its own funds a sum of £10,000 to advertise the highly nutritive qualities of honey ; and that it has, by a voluntary levy of one-eighth of a penny per lb., raised an amount of £42,000 to finance the stabilization of the industry? Is he also aware that a high percentage of new honey producers are ex-servicemen who have put all their finance into the purchase of equipment for the production of honey, and that such equipment cannot be used for any other activity? Is it a fact that temporary checks may result in new or marginal producers leaving the industry, and that such an event would lead later to a shortage of this particular foodstuff, which it would be desirable to avoid? Will the Treasurer give sympathetic consideration to requests from the industry for financial assistance at times when it is faced with temporary setbacks due to overseas movements or to sudden variations of production ?

Mr FADDEN:
CP

– That matter is at the moment receiving the consideration of the Department of Commerce and Agriculture. A submission will he made to Cabinet in due course in connexion with it.

page 713

QUESTION

PENSIONS

Mr CREMEAN:
HODDLE, VICTORIA

– Is the Prime

Minister aware that the “adequate maintenance “ provisions that are applied when consideration is being given to applications for invalid pensions from persons between the ages of sixteen years and twenty-one years, are a source of great hardship to the families of such applicants? Is he also aware that although the previous Government greatly relaxed the severity of those provisions, their application is still most irksome to the applicants? Will he investigate this matter immediately with a view to the introduction of legislation to remedy the position or to the taking of such action as would cancel the “ adequate maintenance “ provisions as soon as possible, so as to make invalid children under the age of 21 years eligible for a pension on the ground of invalidity alone ?

Mr MENZIES:
LP

– I shall ask my colleague, the Minister for Social Services, to examine the point, that the honorable member has raised.

page 713

QUESTION

TUBERCULOSIS

Mr HULME:
PETRIE, QUEENSLAND

– In directing a question to the Minister for Immigration I explain that I have been informed that a substantial increase has occurred in the number of infantile tuberculosis cases admitted to public hospitals in Australia, most of the patients being children who came to Australia under our immigration programme. In view of the danger of a considerable spread of the infection among Australian children prior to the detection of the disease in immigrant children, will the Minister assure the House that the fullest precautions will be taken before the embarkation for Australia of migrant children, and ensure that regulations relating to X-ray and medical examinations of migrants will be enforced?

Mr HOLT:
Minister for Immigration · HIGGINS, VICTORIA · LP

– I can assure the honorable gentleman and the House that very strict precautions are taken before the departure, from Europe or other countries, of all migrants for Australia brought out by the Commonwealth under its own immigration scheme. , I am surprised to learn that there hasbeen a report of any great increase in the number of cases of infantile tuberculosis. The last advice I had was to the effect that a very small proportion of people who, having been given a medical clearance in Europe, were found, after their arrival in Australia, to show some evidence 01’ active tuberculosis. I shall have the report examined in order to ascertain whether I can supply some more precise information.

page 714

QUESTION

COAL

Mr GEORGE LAWSON:
BRISBANE, QUEENSLAND

– Will the Prime Minister inform the House what tonnage of coal has been bought by the Australian Government from South Africa and India, the cost per ton of such coal and its total cost? What quantity of this coal has yet to be delivered? What is the subsidy that is paid on each ton of coal imported from South Africa and India and sold to South Australia and Victoria? Does the Government propose to continue importing coal from outside Australia while there is unlimited coal for sale in Queensland ?

Mr MENZIES:
LP

– If the honorable member will give me a copy of his question I shall have the information that he seeks obtained for him.

page 714

QUESTION

AUSTRALIAN PRISONERS OF WAR

Mr MENZIES:
Prime Minister · Kooyong · LP

– by leave - I lay on the table the following paper: -

Prisoners of War, 1939-45 - Report of Committee appointed to investigate question of payment of special subsistence allowance.

In May, 1950, the Government appointed a committee to investigate the question whether a special subsistence allowance should be paid to Australian servicemen who, during the 1939-45 war, became prisoners of war in enemy hands. The. committee consisted of Mr. Justice Owen, of the New South Wales Supreme Court Bench, Lieutenant-General Sir Stanley Savige and Dr. W. E. Fisher. Each member of the committee was well qualified for his taskby service and other experience. The committee was asked to report -

Whether, having regard to all the circumstances, it recommends the payment of any special allowance and
If so, at what rate and upon what conditions.

The committee’s report has now been received and I have just tabled a copy of it. It consists of two documents. The first states the conclusions of Mr. JusticeOwen and Lieutenant-General Sir Stanley Savige, while the second is signed by Dr. Fisher whose views differ in a material respect from those of the majority.

Two main issues were before the committee. The first was whether the enemy powers failed to fulfil the duties and obligations towards prisoners of war imposed by the Geneva Convention and thereby caused undue hardship to their captives. On that question all three members of the committee agreed that both Germany and Japan failed to meet the provisions of the convention and thereby caused unduehardship to Australian servicemen. The second issue before the committee waswhether a moral responsibility rested upon the Australian Government tomake a special monetary payment to those of its servicemen who were subjected to such hardships.

The majority report is to the effect that the Australian Government is under no moral obligation and it therefore does not recommend that a special subsistence allowance be paid. In the opinion of the majority, if a captor power failed to fulfil its obligations to its prisoners, thus causing them extreme hardship, and it was intended to grant some compensation, this should be made by the defaulting power and not by the power to whom the prisoner belonged. Dr. Fisher, in his minority report, expresses the opinion that a payment of 3s. per day should be made out of reparations, if any. The Government has considered the report and will act upon the view of the majority. It does, however, feel that there will be, perhaps, many cases of special hardship or disability attaching to former prisoners of war which may be outside the scope of provisions now made for the services generally. It is therefore proposing to establish a Prisoners of War Trust Fund of £250,000 to be administered by a board of trustees to be selected by the Service Ministers and the Minister for Repatriation. Payments from the trust fund will be made to prisoners of war of the 1939-45 war considered by the board to have suffered special disability not common to other members of the services and as a direct result of their war imprisonment.

I I need hardly add that all payments made from the trust fund will be additional to repatriation benefits to which the recipients are otherwise entitled.

I also lay on the table the following paper : -

Prisoners of War 1939-45 - Special Subsistence Allowance - Report of Committee and Proposals of the Government - Ministerial Statement, :and move -

That the report and statement be printed.

Debate (on motion by Mr. Haylen) adjourned.

page 715

COMMONWEALTH GRANTS COMMISSION

Seventeenth Report

Mr FADDEN:
Treasurer · McPherson · CP

– I lay on the table the following paper : -

Commonwealth Grants Commission Act - Commonwealth Grants Commission - Seventeenth Report, 1.950, and move -

That the paper be printed.

The Government has adopted the recommendations contained in the report and legislation to authorize payments for the year 1950-51 will be introduced later to-day. Copies of the report are expected to be available shortly.

Debate (on motion by Mr. Chifley) adjourned.

page 715

LEAVE OF ABSENCE

Motion (by Mr. Menzies) - by leave - Agreed to -

That leave of absence for one month be given to the honorable member for Darwin (Dame Enid Lyons), on the ground of ill health.

page 715

BASIC WAGE

Mr HOLT:
Minister for Labour and National Service and Minister for Immigration · Higgins · LP

– by leave - I take this opportunity to advise the House that the Government has received a message from the Attorney-General’s

Department that a final announcement relating to the basic wage made this morning revealed a majority decision of the court in favour of the payment of an increased wage of fi, the female rate to be 75 per cent, of the male rate. The majority decision was given by Judges Foster and Dunphy. Chief Judge Kelly recommended no change in the present basic wage. I understand that a date of operation has not yet been determined and the principle to be applied to each union will be announced later. In due course copies of the full judgment will be made available for the information of honorable members.

page 715

TELEVISION

Formal Motion for Adjournment

Mr DEPUTY SPEAKER (Mr Adermann:
FISHER, QUEENSLAND

– I have received from the honorable member for Melbourne (Mr. Calwell) an intimation that he desires to move the adjournment of the House for the purpose of discussing a definite matter of urgent public importance, namely -

The action of the present Government in abandoning the programme of the Chifley Government for the creation of six television stations in Australia and deciding instead to erect one only; and for doing other things designed to delay the introduction of television to Australia.

Mr CALWELL:
Melbourne

– I move -

That the House do now adjourn.

Mr DEPUTY SPEAKER:

– Is the motion supported?

Eight honorable members having risen in support of the motion.

Mr CALWELL:

– I move this motion with very great pleasure because, if .the Government deserves to he castigated on anything - and it does deserve to be castigated on many things - it deserves to be castigated on this question on which it has shown both remissness and a retrogressive attitude. The Chifley Labour Government was very anxious to ensure that the advantages of this amazing development should be made available to the Australian people. Two years ago preliminary steps were taken by the Cabinet to arrange for the introduction into Australia of facsimile broadcasting, frequency modulation, and television broadcasting, or telecasting as it is sometimes called. Before the 17th June, 1948, a Cabinet sub-committee had been appointed and on that date the Cabinet sub-committee made the following recommendation to Cabinet: -

With the object of enabling further consideration to be given to the matter of the introduction into Australia of a television broad, casting service, with due regard to the cost of television equipment which would be suitable for Australian conditions -

The Postal Department should be authorized to call tenders for six suitable television transmitters and 500 receivers for installation in the six State capital cities;

Before any tender is accepted, or the Government is committed in any way to the purchase of television equipment or the introduction of a service into Australia, the matter should be considered further by the Cabinet sub-committee and a definite proposal submitted to Cabinet.

We were taking the preliminary steps towards the introduction of telecasting, but we knew from our investigations that we needed to a,ct with a certain amount of caution because the developments in the field of television were both spectacular and rapid. In 1938 the British Government decided on a 405-line screen system. That was a very marked technical advance at the time, but to-day the system is almost obsolete. We knew that there were interests in England anxious to foist this system on to Australia so that we could help to share the losses which would be involved when that system had to be scrapped for a more modern system. We knew that America was using a 525-line screen, and good as that was we thought that we could perhaps get a better system if we waited a little longer. Ultimately we decided on a system of 625 lines because that system gives a degree of clarity to the televised picture which is almost comparable with that of a picture on a cinema screen. We believed that that system was as good as could be got in relation to the cost of operation. An 819-line screen system operates in France, and while that does seem to give a clearer picture definition the cost of operating is so much greater that it will probably be found to be uneconomic. In the 625-line system we feel that we have about the best that we can get and that it is a system which may ulti- mately become the European standard. On the 2&th June, 1948, the Chifley Government approved of a recommendation from its sub-committee in the following terms : -

J.’hat the Postal Department should be authorized to invite tenders for two suitable television transmitters, for Sydney and Melbourne, and, alternatively., for six transmitters, one in each State capital city, on the understanding that the matter should be resubmitted in the light of the tenders received, so that the question of dollar expenditure in relation to the television transmitters required could be examined.

On the 11th August, 1948, tenders were invited by the Postal Department for two and six television transmitters accordingly. The call for tenders was held in abeyance pending the adoption of transmission standards. We did not set standards in our advertisements inviting tenders because we thought that we should leave it to the manufacturers to do the best they could, and that in doing so perhaps we would be furnished with new ideas. We were not hide-bound in the matter of standards. On 20th January, 1949, we received tenders from eleven manufacturers for the supply of transmitters. Those tenders came from Australia, the United Kingdom, the United States, Holland and France. On 14th June, 1949, Cabinet approved of the following recommendations of the subcommittee : -

The Government should approve in principle of the introduction of television services in Australia, and that, at the outset, such services should be provided in the six State capital cities.

I interpolate here that the Government believed that every State capital city was equally entitled to the benefits from this great discovery and that it was wrong to make a beginning in Sydney only, or in Sydney and Melbourne. We believed that the cost of installing these six transmitting stations would be of the order of £1,000,000, and that the cost of operating would be about £1,400,000 annually. The proposal, therefore, could not be ruled out on the ground of cost. The Cabinet also approved of the following recommendation of the sub-committee : - ( & ) The* Government should approve of the technical standards proposed toy the Australian Broadcasting Control Board for adoption in Australia.

The Australian Broadcasting Control Board was established -by an act passed in December, 194)8, and the standards which the Postal Department had recommended were also recommended later by the board. The Chifley Government decided to act on the recommendation, and the present Government has also adopted that decision. To that extent we have made some progress. The other recommendations of the Cabinet sub-committee were -

That the Board, in conjunction with the Post Office, should be authorized to consider further the tenders received with a view to making a firm recommendation as to the tender or tenders to be accepted.
The Government should approve, in principle, that the television programme in Australia should be provided only by a National television service.
The Board should be authorized, in consultation with the Post Office, to take such preliminary action as might be necessary for making preparation for the introduction of television services, including making arrangements for further technical investigations and for the training of technical and production staff.

We decided to make television a national monopoly and included a provision to that end in the Australian Broadcasting Act of 1948. We believed that the. harm that has been done in the field of commercial broadcasting by those who had been lucky enough to get licences and who had exploited the public should not be repeated in the field of television. Furthermore, we did not know much about the possible future developments of television. The situation was fluid. The Menzies Government has now decided that it will try to amend the Australian Broadcasting Act in order to allow private enterprise to enter the field of telecasting. It will not be possible to establish more than three television stations in any capital city. Therefore, if the Government were to grant a franchise to operate a television station to private enterprise before we obtain more knowledge about the subject than we now possess, it would merely present to the lucky person who received the franchise an opportunity to make a large sum of money by inviting other persons to participate in the fortune that they had missed at the price that the successful applicant would demand.

The position that exists to-day in the field of commercial amplitudinal broadcasting is bad enough. We now have more than 100 radio broadcasting stations and: possibly, thousands of other people in the community think that they should be given a channel whereas it is not possible to allot any additional frequencies. Those people have to reconcile themselves to the thought that it was a case of the early bird getting the worm, or being lucky enough to get it.

– It is a matter not of what is desirable but of what is happening in this field. There are good and bad features about television just as there are good and bad features about radio. But nobody would say that it was a wrong decision on the part of the government of the day in 1920 to make the first radio broadcast in Melbourne, that being the first broadcast that was made in this country, and to invite people to . listen to the broadcast and appreciate the wonders of that tremendous development in our community life. Television is an extension of that invention, and we should be wrong if we were to say that we will dampen down public enthusiasm for television. As the United States of America has 103 telecasting stations with a total number of viewers of 5,000,000 and England has two television stations whose broadcasts are enjoyed by 400,000 viewers, surely the Government will he justified in developing television in this country as rapidly as possible.

Television will undoubtedly bring changes in our social life. It will affect the investment of a lot of people in cinemas, theatres, the promotion of fights and radio broadcasting as well as the interests of manufacturers in the radio field. However, we must ensure that the interests of the people shall be served, because, primarily, governments exist not to protect the vested interests of individuals ‘but to serve the interests of the general public.

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– Perhaps we should televize proceedings in the Parliament.

Mr CALWELL:

– That may well come about; but it would have disastrous effects for the Liberal party and would result in the complete extinction of the Australian Country party. For obvious reasons, the honorable member for Mackellar (Mr. Wentworth) would be the greatest opponent of the telecasting of proceedings in the Parliament. When the Chifley Labour Government inaugurated the broadcasting of proceedings of the Parliament, reactionaries opposed the innovation. I believe that the people of Australia would destroy any government that attempted to interfere with the present system of broadcasting proceedings in the Parliament. If parliamentary proceedings were televized the people would better be able not only to hear but also to see in operation those whom they have sent here to represent them. The Government must recognize the inevitability of change. Change is the law of life. Very few things in life remain stationary. Most of the things that remain stationary become stagnant. Life is made up of progression and retrogression. It is extremely foolish to try to stop changes or to retard the rate at which those changes are proceeding. Although, recognizing that change is inevitable, this Government is trying to fool the people, ‘hut it will not .succeed in doing so, when, in relation to television, it says that it has some reason for not hastening. I consider that vested interests are holding the Government back. Some people, who do not want the introduction of television unless they can get in on the ground floor and control the whole system, do not favour that change.

Considering all the progress that has been made with television in other countries, Australia, as a nation, is beginning to look foolish in deciding that it will be at least another two years before we do anything about it. The PostmasterGeneral cannot justify that inaction by saying that the development of television will interfere with the departmental programme for installing telephones and building new automatic exchanges in the country. All those works can proceed as a part of the one programme. When the Chifley Government was in office, an enormous number of telephones was installed, and as many exchanges were built as was possible with the labour and materials that were then available, yet we laid the foundations for the installation of underground cables to improve our telecommunications services between the capital cities, and that work will facilitate, in due course, the introduction of relays of telecasting from capital to capital when our television stations are established. The engineers of the Postal Department speak of coaxial relays, and that development should be proceeded with immediately.

Mr DEPUTY SPEAKER:

– Order ! The honorable in ember has exhausted hisextended time.

Mr ANTHONY:
PostmasterGeneral · Richmond · CP

– The honorablemember for Melbourne (Mr. Calwell), who was formerly the Minister for Information, is a man of surprising parts. When I heard that he proposed to move the adjournment of the House this morning, I was not immediately informed of the subject that he intended to discuss, and, for a moment, I thought that hehad decided to direct attention to Australia’s defence unpreparedness, and tothe necessity for action by the Government to rectify that matter. However, reflection for only a moment caused meto realize that our defence unpreparednesswould be the last subject that he would raise in this .Parliament. Then I thought that he might discuss an old! friend, putting value back into the £1, but I quickly concluded that he regarded that subject as a dead horse, which he did not propose to attempt to revive. Standing Order 48 provides that the subject-matter of a motion for the adjournment of the House, which takes precedence over Government and other business, shall be one of urgent public importance. This Government has been in office for ten months, and the honorable member for Melbourne has moved the adjournment of the House to indict it for its alleged inaction in respect of introducing television. I shall inform the House of some of the statements that were made by the honorable gentleman himself in the heyday of his career as Minister for Information, and even before that, as a member of the Broadcasting Committee.

I agree with my departmental advisers and my colleagues in Cabinet who consider that we must be cautious in introducing television, and that we should hasten slowly, because we shall be venturing into what will be, for Australia, an untrodden field. The caution that we are exhibiting in this matter has been displayed in other countries. The first television station in Great Britain was built in 1936, and, to-day, only two such stations are operating in the United Kingdom. One of- them lias been erected in London and the other in Birmingham. There are only 250,000 viewers of television programmes in the United Kingdom. The British Government has proceeded cautiously in that matter. The United States, which has a tremendous potential productive capacity and a venturesome spirit for which it is famous, has rushed ahead with television. Approximately 100 stations have been erected, and between 4,000,000 and 5,000,000 television sets are in use. However, the United States Federal Communications Commission held up its hand about a year ago and prohibited the erection of new television stations in that country. The commission declared that, had it known as much two years earlier as it knew when it imposed the prohibition, a different policy would have been formulated in respect of television. The decision of the Australian Government in the matter is supported by the views of the previous Government. The Broadcasting Committee, under the chairman- ship of Senator Gibson, stated in a report to the Parliament in 1942 -

Because of the human reactions brought into play, great caution is necessary in considering the introduction of television ae a public utility service.

A signatory to that report was Arthur Augustus Calwell.

Mr Calwell:

– That was not the same thing. That occurred in 1942..

Mr ANTHONY:

– The honorable member for Melbourne subsequently became the chairman of the Broadcasting Committee, and, when he was promoted to the Ministry, Senator Amour was appointed the chairman. On the 17th June, 1946, the committee, under the chairmanship of Senator Amour, presented a report to the Parliament on frequency modulation broadcasting, television broadcasting and facsimile broadcasting in which it was stated - . . we recommend - as a first step in evolving adequately informed conclusions on the issues raised in our terms of reference - that tenders be invited, as soon as circumstances permit, under conditions acceptable to the Post Office, with a view to consideration being given to the question of arranging experimental transmissions in Sydney and Melbourne.

Four years ago, that committee recommended that experimental transmissions be arranged. The Chifley Labour Government had ample opportunity to implement that recommendation, but it failed to take any action.

Mr Calwell:

– That is nonsense.

Mr ANTHONY:

– I have all the facts. On the 13th March, 1947, the then Postmaster-General. Senator Cameron, recommended to the Chifley Government that no further action should be taken regarding television for the time being. Later, with the approach of the general election, the Labour party wanted to provide ice creams and circuses for the people and it produced a plan to establish television transmitters in six capital cities. Although tenders had closed and a recommendation for the acceptance of certain tenders had been made by the Australian Broadcasting Control Board in August, 1949, three months before the Chifley Government went out of office, nothing further was done until the present Government came into office. As PostmasterGeneral, I was asked to accept the policy that had been formulated by the preceding government. The last thing that I would do would be to accept that policy without thoroughly examining it, and my examination led me to the conclusion that the erection of six television stations in Australia at this stage in the history of television would be the most senseless course of action imaginable. Every authority that had studied the problems of television had recommended that we proceed cautiously. The field of television was unknown territory. Even yet we do not know, and the authorities of Great Britain and the United States of America dc not know, what impact television will have on the public and what social changes will result from its development.

Dr Evatt:

– What social changes could there ‘be?

Mr ANTHONY:

– The honorable member for Melbourne talked about the beneficial effect that television would have upon children. This Government sent the chairman of the Australian Broadcasting Commission, Mr. Boyer, abroad recently so that he could study developments overseas. When he returned to Australia less than two months ago, he wrote an article for Australian newspapers in which he made the following statement, which I quote from the Sydney Morning Herald: -

There is no shadow of doubt that it puts new and distressing strains on discipline in the home - simply because it is quite irresistible to children, and hosts of parents are bewailing the domestic battles that go on about bed-time, and the unsuitability of some of the programmes.

Members of the Opposition laugh at the statement, but that is an important factor that must be considered in relation to television. However, the greatest factor is the unfitness of a policy of constructing television stations before homes. That is the real issue.

The honorable member for Melbourne takes credit for his formulation of the programme which brings a stream of immigrants to Australia at a rate exceeding 200,000 annually, yet apparently he would be satisfied to let immigrants go homeless and to divert our resources to the production of luxuries such as television stations. I have before me a report which states that there is a backlog of 250,000 homes in Australia to-day.

Mr Calwell:

– What is the Government doing about it?

Mr ANTHONY:

– One of the things that it will not do is divert essential materials from the housing programme to non-essential projects. Our population i3 rising rapidly as the result of both immigration and the natural increase. Our people require approximately 90,000 new homes a year, but the best that we have been able to do up to date has been to construct 57,000 houses last year, an all-time record. The Postal Department has a backlog of more than 100,000 unsatisfied applications for telephone installations. If the Government undertook the construction of six television stations, the department’s inadequate staff of technicians, upon which we depend for the provision of various essential services, would be depleted further by 180 or 200 experts. I am indeed astonished that the honorable member for Melbourne should endeavour, in effect, to censure the Government for failure to divert already scarce materials to the construction of television stations. I have before me a picture of the honorable gentleman that was published in the most recent issue of the Sunday Herald of Sydney. The honorable gentleman is ‘portrayed, in his former capacity of Minister for Immigration, kissing the 100,000th immigrant to arrive in Australia. That incident occurred in August, 1949. Accompanying the picture was a special feature article describing what had happened to certain persons who had been in the news. This is what had happened to the little girl whom the honorable gentleman kissed -

Glasgow-born Isabelle was the 100,000th British migrant to reach Australia since the war ended . . . When last in the news the Saxelbys were living in a converted cow-shed.

This Government has set out to provide accommodation for immigrant!). Extension of time granted.] It has put first things first, and one of the first points. in its programme is the provision of roofs for people who are virtually homeless to-day.

The Government’s attitude towards the introduction of television is not singular. Canada, a great country that has a. population almost double that of Australia, has adopted a similar attitude. The Canadian Broadcasting Corporation has let contracts for the erection of only two television stations, at Toronto and Montreal. It has disregarded Quebec, Ottawa, Vancouver and many other provincial capitals. Its policy exactly parallels that of this Government.

Dr Evatt:

– To what distance does the television service extend from each of the two centres that the Minister has mentioned ?

Mr ANTHONY:

– A television station has an effective radius of only 40 or 50 miles. Although that country has the example of its neighbour, the United States of America before it, it has not erected a myriad of television stations but has contented itself with erecting two television stations. For the moment it has debarred private enterprise from entering the field, although private enterprise will be permitted to do so when the time is considered appropriate.

Although I have said a good deal this morning to explain the reasons why the Government should exercise caution in this matter and why we should give priority to matters that we consider more essentia], I still consider it important that we should introduce television in Australia and that we should not lag behind the rest of the world in the application of modern scientific knowledge. The view that I expressed to Cabinet, which was accepted, is that we must make a start with television in this country, but before doing so we should obtain first-hand information and the most expert advice from abroad so that television will be established in this country on sound lines. We believe that the soundest principle to follow is that which was laid down by the Parliamentary Standing Committee on Broadcasting in a report which it submitted to the Parliament in 1946. That report recommended that we should begin with only one station and that we should gradually expand our knowledge of the most suitable type of programmes to be televised and should acquire technical experience of the operation of television under local conditions. Those are exactly the lines upon which the present Government is proceeding. After all, television must be viewed in its proper perspective, which is that it is merely one factor in a properly balanced economy.

In other words, whilst we must keep in step with the rest of the world by making available to our people the most modern amenities, we owe a prior obligation to those Australian citizens who are without many existing amenities that are essential to a decent existence.

Mr RIORDAN:
Kennedy

.- The facts placed before the House by the honorable member for Melbourne (Mr. Calwell) this morning have not been answered by the Postmaster-General (Mr. Anthony). The Minister commenced his speech by indulging in personal abuse of the honorable member, who is a former Minister, and he devoted fifteen minutes of his time to an attack upon the honorable gentleman and only five minutes to the subject of television. The Minister sought to defend the tardiness of his Government in introducing television by stating that in Great Britain there are at present only two television stations although a third one is in course of construction. That is quite true, of course, but it is also true that since 1938, when the first station was built, a world war and an economic crisis have supervened and have prevented the United Kingdom from devoting its national energies to anything but the task of survival. The television apparatus that was erected in the United Kingdom was a 405-line system. The Chifley Administration, which reviewed very thoroughly the experience of other countries in which television operated, decided, on the recommendation of experts, that a 625-line system was the most appropriate for Australia. The argument put forward by the PostmasterGeneral that we must proceed with extreme caution because television is a new field of experiment, is not altogether convincing because we have the advantage of the experience of countries in which television has now been operating for some years. The honorable gentleman also made much of the fact that Canada has only two television stations, but, at least, that is twice the number of stations that the present Government proposes to establish. The previous Government decided to make the benefits of television available to all parts of Australia, and for that reason it determined to erect six stations, which would be located in the capital cities. However, the present Government, which like previous anti-Labour governments is affected by the “ Sydney Harbour “ complex, has decided to provide only one station, which will, of course, he located either in Melbourne or in Sydney and will serve only the favoured few who reside in either of the southern capitals. By erecting six stations the cost of each installation would have been considerably less than that of a single station, and the cost of maintenance and administration of each of the six stations would have been considerably les3 than the cost of operating and maintaining a single station. Indeed, under Labour’s plan, it would have cost only approximately £1,000,000 to erect the six units, and the total annual cost of administration would have been only £1,300,000. That is a very small item in the national budget, and it is idle, therefore, for the Minister to suggest that the expenditure involved in our programme was a valid reason for not proceeding with it. Tha Minister contended that because of the demands made upon our funds by the expansion of the defence services the money could not be spared. Whilst members of the Opposition are just as keenly interested in defence as are members of the Government parties, I remind the Minister that we are not at the moment discussing defence hut are debating the right of the Australian people to participate in a new amenity that is enjoyed by the people of the United Kingdom and the United. States of America.

The honorable member for Melbourne informed us that the French Government had decided to operate an 819-line system, but whether that decision has actually been implemented I do not know. The 625-line system, which the Chifley Administration was advised to install, has the merit that it would furnish maximum efficiency for a minimum of cost. It is idle, therefore, for the PostmasterGeneral to speak of the merits of the E.M.I. and the P.Y.E. systems, which have only 405 lines. The system in operation in the United States of America is the 525-line system, and we should profit by the experience of that country..

I ask myself, what is the real motive for the attitude adopted by the Government in this matter? Is it due to the influence of Mr. Warner, a member of the former

Hollway Liberal Administration of Victoria, and a very influential member of the board of Electronics Industries Limited, who threatened to institute legal proceedings against the Chifley Government if it accepted a tender for the supply of television equipment? Or is the explanation that the Government has been influenced by a representative of P.Y.E. , of Great Britain, who recently visited this country, or by Sir Ernest Fisk, the former general manager of Amalgamated Wireless (Australasia) Limited, who is now a high executive of E.M.E., and who recently visited Australia ? Of course, we know that these organizations are unofficially associated. I stress the significance to the Government’s decision of the attitude adopted by Mr. Warner some time ago and of the special visits made to Australia by the representatives of big business from overseas. Is the reason for the Government’s decision to scrap the comprehensive plans of the Chifley Administration and to proceed with its own inadequate proposal that it wishes to make merely a token gesture to the people of Australia ?

I remind the Postmaster-General, who spoke as though television were still in its experimental stages, that 103 stations are now operating in the United States of America. Of course, the Minister attempted to make capital out of the fact that the Federal Communications Commission in that country had criticized television. It is true that that .body did make some criticism of the operation of amplitude modulation stations, but I point out to him that the commission was established years ago in order to deal with the confusion that had arisen because of the excessive number of radio stations that were operating on ordinary amplitude modulation. It was never intended at the outset that the commission should deal with television, and, in any event, television had not then been implemented. It seems clear, therefore, that the reference made by the PostmasterGeneral to the Federal Communications Commission has no real ‘bearing on the matter under discussion. We say in effect that as most of the people of Australia are congregated in the capital cities, a television station in each of those cities would be the means of giving the best service to the greatest number of people at the minimum of cost. Tha Government should take cognizance of the fact that the establishment of six stations would provide the training of six times as many technicians as would the establishment of only one station. Therefore, in the interests of technical advancement and of the development of the television industry, it is necessary that six stations be established. The Postmaster-General’s references to housing and to the use of building materials that would be involved in the construction of six stations, which were produced as excuses for the Government’s proposed action, are just red herrings. He made no reference to the fact that prior to the war, when an antiLabour government of the same kidney as the present Government put through an act to deal with the provision of hous-ing, it built only one house,” and that house was for occupancy by the present Minister for National Development (Mr. Casey) .

Mr CASEY:
Minister foi National Development and Minister for Works and Housing · La Trobe · LP

.- The honorable member for Melbourne (Mr. Calwell) - a proud title - who was a senior and responsible Minister in the late Labour Government, has moved the adjournment of the House for the purpose of discussing “ a definite matter of urgent public importance “ - that is, that we should add to our already overcrowded market for public entertainment in Australia. The honorable gentleman held a high and responsible post in the late Government, yet he appears entirely to overlook the fact that the world is in probably the most disturbed and serious state that it has ever been in during a time of so-called peace. Yet at such a time he seriously urges that we should expend our energies and our raw materials in adding, as I have said, to our already overcrowded entertainment market. I ask the honorable gentleman to consider some aspects of this matter. The Government of which he was a distinguished .member aimed, and as the Opposition now aims, at a great, planned economy for Australia. I suggest that, as a result of that Government’s eight years in office, this country has the most unplanned economy in the world. Under the aegis of the late Government the industries of Australia, either with or without encouragement, expanded their production by a great many times during the war years. All those industries used electricity, oil, coal, steel, bricks, cement and other basic materials. The late Government was perfectly content to watch industry expand at a record rate during the war years, and use up those raw materials, without giving one moment’s thought to taking steps to increase the production of basic materials.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– What about the Snowy Mountains hydro-electric project?

Mr CASEY:

– That project is a perfect example to illustrate the .point that I am making. It was entered into without any thought having been given to the necessity to increase the production of steel, cement and all the other materials that are involved in the carrying out of such projects. The result is that we have now in Australia a sort of dog’s breakfast that the present Government has inherited from the previous Government, in which all the important raw materials, without any exception - power, transport, coal, steel, coke, cement, bricks, tiles, and everything that makes a community tick - are in gravely short supply. At the same time, I suppose we have, picking a not unreasonable figure out of the air, £1,000,000,000 worth of urgent developmental works that need to be carried out. I should classify any constructional work as being in two categories, the first of which might be termed “ muscle “’ and the second “ fat “. In the “ muscle “ category I put the rapid increase of power generation, coal production and the manufacture of steel, cement, bricks, coke, hydrochloric acid and all the other basic materials. That is “ muscle “, because it adds to the ability of the community to produce, which is the goal to which the Government is primarily giving its attention. The other category, which could be described as “ fat “. includes television and a number of other activities that are now being carried on in this community. They add nothing to the country’s constructive ability, to the strength of its industry and economy, or to its ability to defend itself. Do not let us think that 8,000,000 people in a great land such a.s ours can have everything that they desire, particularly at a time like this, when the world is greatly disturbed and is moving towards a third great cataclysm. We have to get down to the essentials. We cannot afford everything. Let us ‘concentrate on providing “muscle” to the limit of our ability and cut out all this nonsense about “ fat “.

– If the honorable gentleman would confine himself to making sensible statements and would utter less nonsense, the tone of this debate would be improved. Television has a range of under 50 miles and would add to the already great amenities of the capital cities. By so doing, it would strengthen the magnet that the capital cities constitute, which draws people from country areas. We do not want such a movement of population. I consider that the Postmaster-General, whose political origin was in the Australian Country party, was statesmanlike, to say the least, ill proposing that, instead of provid ing for television on a big scale at the outset, Ave should establish one station and learn by experience.

I propose in the very near future to circulate to honorable members and senators a short list of the principal developmental activities in Australia. It occupies about ten pages of close type, each item being allotted six or seven lines. The list is limited to works and propositions each of which will cost £500,000 or more, and annexed to it is a map which show.. their location. This will bring home to honorable gentlemen the vast task that presents itself to this country in the developmental field - in the muscle field and not in the fat field.

It seems to me that the honorable gentleman’s motion is bred of a desire to oppose. The duty of an Opposition, it has been said, is to oppose, but I consider that, under present conditions, opposition for opposition’s sake by means of facetious argument is not in the best interests of this country. Honorable members are the servants of the people and their time is not their own but it helongs to the people. Is this a time, with the world almost going up in flames for the National Parliament of Australia to spend two or three hours debating a matter that is not worth “ tuppence “ to the people of Australia? Is that going to enhance the repute of this Parliament? I can only ask such fellow Australians as may be listening to believe that this debate has not been brought on at the Government’s instance. The Government deplores it and considers it to be a grievous waste of time.

I join with the Postmaster-General in saying that the Government is doing precisely the right thing. I think that I could probably live all my remaining years without television. I do not believe that there is any outcry for television among the people of Australia and, if there is, I think that our advice to them should be that they will not be any worse off, and may be vastly .better off, if they wait a few years until the sea is a bit calmer before they make this addition to the already swollen field of entertainment in Australia.

Dr EVATT:
Barton

.- Honorable members have listened to a very interesting speech by the Minister for National Development (Mr. Casey). His allegation ‘that the House is wasting its time in debating this matter is most extraordinary. The Government has no other business with which to proceed. After this business concludes a debate that is a week old will proceed on international affairs, which have changed since the debate began. If the House is wasting its time, the Government has the remedy in its own hands. If the subject of defence is of such urgent importance as the Minister indicated, then it would be perfectly feasible for the Government to say that it would not proceed with television at all. But that is not the Government’s attitude. The Government has put aside a plan for the erection of six television stations. It has not said that the plan cannot be implemented in a. time of emergency, but has limited it to one station which is to be built in Sydney. If the argument of the PostmasterGeneral were consistent with that of the Minister for Development, one could understand the Government’s point of view but the arguments of the two Ministers are in absolute conflict. The PostmasterGeneral claims that television is a very dangerous thing about which we do not know very much. He says that it might disturb the life of the home because there might be competition among members of the family to look at the various television programmes and that therefore it must be developed prudently. Is there any difference, in this way, between television and radio? Is there not competition in the home for the right to listen to certain programmes? Every parent knows that there is. That point is .complete^ irrelevant to this matter.

Australia is lagging behind every other country of the world in this modern, scientific age. There is some reason impelling the change that has been made. A number of powerful interests in this country are opposed to television. An article that was published in the July issue of Fortune magazine dealt with television and the caption “ Who’s afraid ? “ described the tenor of it. Among those who are opposed to television are the radio interests. This article says -

Radio and television are certainly in collision. They compete in time and space with not dissimilar programmes and attractions.

The Minister says that this is another adventure in the entertainment field. That will be said by the owners of the profit-making broadcasting stations. The introduction of television will revolutionize the whole industry as it has already done in the United States of America. I gave some figures to the House recently which indicated the change that has been made by television in the transmission of sporting events. Whereas the fee paid for the broadcasting of a baseball competition in America amounted to about 50,000 dollars, the fee for televising the same entertainment amounted to about 670,000 dollars. By this medium of entertainment, events are brought into the home and shown as they would be in a cinema.

I do not think that the Government should try to put back the hands of the clock. I do not think that the lack of materials is the reason why a station is to be erected in Sydney only. I believe that fear is gripping certain interests in Australia. The chairman of the Australian Broadcasting Commission has made a most extraordinary statement concerning television. What he has said was said about radio when it started. I do not regard it as a function of his to indicate the ridiculous possibilities that he mentions in the passage that was read by the Postmaster-General. It is true that television programmes are of considerable public importance and that it might be possible to have programmes that would be detrimental to the community but that applies also to radio broadcasts. Why should the chairman of the Australian Broadcasting Commission venture to engage in this controversy ?

Mr Anthony:

– I think that that is unfair to him.

Dr EVATT:

– It is not. I made my remarks in moderate language. I was amazed at his intervention. Why should the head of the Australian Broadcasting Commission say that there is something to be afraid of in television?

Mr Anthony:

– Does the right honorable member think that the chairman of the Australian Broadcasting Commission is not entitled to write an article for the press ?

Dr EVATT:

– No. But I differ from him. I want to know why he wishes to call a halt on television development. I do not know who wrote the article in Fortune, but it is written from the point of view of business interests in general and not from the standpoint of radio or television stations.

It is very important that Australia should not lag behind the United States or Britain in the development of television. There is an educational aspect of television which could be of enormous advantage to the people of Australia and the Government should take the initiative in the establishment of television stations. I cannot see why, if the experiment may be dangerous, the homes of Sydney people are to be treated as being of no importance. If there is no danger it is absurd that only one city should ‘be selected for the erection of a television station. Under the control of the British Broadcasting Corporation, television is one of the features of the life of the English people who are within reach of the service. Dramas are transmitted and educational work is done by means of television which could not be done in any other way. Why cannot the Government follow the example of Britain and proceed with the television programme?

Mr ACTING DEPUTY SPEAKER:
Mr. Ryan

– ‘Order! The right honorable gentleman’s time has expired.

Mr GULLETT:
Henty

.- It is extraordinary that honorable members opposite should have criticized the Government for not hastening the development of television in Australia. The honorable member for Melbourne (Mr. Calwell) and the honorable member for Kennedy (Mr. Riordan) are supposed, primarily, to represent the interests of the worker. The workers in the electorate of the honorable member for Melbourne would not benefit from television because they would not be able to afford it, whilst electors of the honorable member for Kennedy would not be able to benefit bemuse they would be too far away from the transmitting station. I am opposed to everything that has been said by honorable members who have supported this motion and I endorse the remarks of the Postmaster-General (Mr. Anthony) and the Minister for National Development (Mr. Casey). If there has been, any unnecessary delay in the introduction of this service it is completely justified because there was never a time when the introduction of what is entirely a luxury was less opportune than it is in Australia at present.

I am opposed to the motion ‘because, as the Minister for National Development pointed out, no one could treat this matter as being of first-class importance. Compared with the problems before this House and another place it is a fourth rate matter and it has been introduced with ill-informed argument with the sole object of diverting the attention of the people from ‘ the failure of another place to bring the anti-Communist legislation into operation. Australia can ill afford a luxury of this sort. Houses, steel, coal and everything by which we maintain our standard of living are in short supply and another great industry can ‘be superimposed on that state of affairs only at the expense of the production of those essential materials. Therefore, I cannot imagine a time less suitable to bring television into operation. I heard the honorable member for Melbourne talk loosely about six television transmitters costing £1,000,000. I have studied this matter for some time, and from my investigations during the last twelve months I have reached the conclusion that on one station alone £1,000,000 could easily be spent. It is of no use for the honorable member for Melbourne to shake his head; he has had access to the same publications and documents that I have had, and he should know that in the United States of America during the last four years more than two billion dollars has been spent on television.

It is ridiculous to talk about providing television services “ on the cheap “. Television must cast a very heavy burden on the taxpayer. Remembering that, it is well to consider that the only people who will be able to enjoy its benefits will be a few privileged and wealthy people. That is quite plain from a consideration of the cost of television receiving sets. The cost of a very ordinary set has been estimated as being between £80 and £100, but I have spoken to experts who have estimated that the cost will be at least £120. The only persons who will be able to afford to own such sets will be the wealthy few whom honorable members opposite spend such a lot of time criticizing. That is well known to the honorable member for Melbourne, yet he demands a television service for those people. I have not heard such nonsense in all my life. It is the poorest horse that he has ever started in this House. Whilst only a few will benefit from television everybody will have to pay for it because, as a government instrumentality, it will be a charge on the public exchequer. Its cost will be defrayed out of the weekly instalments that the worker pays as tax on his wages. He will pay for it but will not benefit from it. I estimate that considerably less than 1 per cent, will benefit from television for the reason that I have stated, and also because reception is possible only within a limited distance from the transmitter.

The honorable member for Darebin (Mr. Andrews) said that television will be of advantage to the defence of this country. He might as well have said that it would increase our defence preparedness to engage in the building of supersonic bombers. We cannot afford, considering our industrial potential, to engage in the construction of complicated and expensive engines of war of that type. We should concentrate on doing the things that we can best do. Highly technical and expensive instruments, such as advanced radar, we hope to be always able to get from the .United States of America or Great Britain, which have the industrial capacity to manufacture such things. . I do not think that many honorable members have had personal experience of television, and certainly, judging from the remarks of the honor- able member for Darebin, his experience must be very limited. I have seen television programmes, and they left me un enthusiastic. It is said that people will be able to watch cricket matches, horse races and other sporting events. The television screen is a small thing about 3 or 4 feet square at the most. Honorable members are asked to believe that a cricket match can be watched in that small screen. I have seen a baseball match televised and I could neither follow the game nor understand which side the players were on. On the screen the ball was no bigger than a fly, and I suggest, from my experience, that it is impossible to follow a cricket match on a television screen. Nor is it possible intelligently to follow a horse race or any other sporting contest. Television is in its infancy and whether it will ever advance to the stage where it will be enjoyable, I do not know; but certainly it has not reached that stage to-day.

I believe that television has possibilities of bringing great harm to this country. The honorable member for Melbourne suggested that the proceedings of the Parliament should be televised. I think that he committed his party to that course oi” action if it attains office again. It is most disconcerting to think that likenesses of honorable members may be taken into the homes of the people while making their speeches. Think of the effect on the children of this country of the speeches of those who not so long ago were advancing this particular proposition. The honorable member for Melbourne has himself taken part in television performances. It is very questionable whether it would be an advantage to televise parliamentary debates in the private homes of our people where innocent children and others could see and hear them. It is well known that television programmes leave a great deal to be desired and that the cost of the industry is so enormous that much time is spent in televising out-of-date motion pictures.

Mr DEPUTY SPEAKER:

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

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– It is amusing to hear honorable members on the Government side complaining about the so-called waste of time in the discussion of this very important matter. I inform the Government that if it is in a position to bring down its budget this very minute the Opposition will forthwith cease this discussion and deal with that budget. Moreover, if the Government is in a position to bring in any important legislation, this debate will not be pursued for one moment longer. The most important legislation ever introduced by any Government is the budget, but this Government’s budget has not yet seen the light of day.

I rise to take part in this debate on behalf of the people of metropolitan Adelaide. Six members of this Parliament represent that area. Only three of those, the honorable member for Adelaide (Mr. Chambers), the honorable member for Port Adelaide (Mr. Thompson) and myself favour giving to the people of Adelaide an opportunity of participating in television. Not one Adelaide member on the Government side - neither the honorable member for Boothby (Mr. McLeay), the honorable member for Sturt (Mr. Wilson) nor the honorable member for Angas (Mr. Downer) - is prepared to allow the people of Adelaide to have an opportunity of viewing television. The previous Government decided on a plan -which would have given to the people of Adelaide an opportunity of enjoying television. That Government’s plan was to build a television transmitting station in Adelaide, and it even reached the stage of calling tenders for the construction of it. When it relinquished office everything was in readiness to provide the 300,000 people of the metropolitan area of Adelaide, with a television service. We find now that the Government has decided that the Australian people are to be denied television services until private vested interests are ready to provide them. The reason for that is that the Government realizes the effect that television will have upon the community and knows that in the hands of private enterprise it will be the means of putting hundreds of thousands of pounds of profit into the pockets of those fortunate enough to obtain transmitting licences.

The effective radius of a television transmitting station is as far as the human eye can see. A transmitter placed on high ground can transmit further than one on low ground. In Adelaide, Mount Lofty offers an excellent site for a transmitter. If situated there, one transmitter could be used for the whole of Adelaide because the whole of Adelaide can be seen from that point. The Government, which is bound hand and foot to wealthy vested interests, has sold out the right of the Australian Parliament to determine, in the interests of the people, that television shall he used as a new modern instrument of education. The Government has determined that it shall be used to distort the minds of the people for the benefit of private enterprise. In the Adelaide Advertiser of the 2nd September, 1950, appears a report of what Mr. R. J. 3?. Boyer said after a survey of American television programmes. The report reads -

Television would make a different people of Australians, the chairman of tha Australian Broadcasting Commission (Mt. R. J. F. Boyer) said yesterday after a 10-day survey of American television system programmes. “ We cannot and should not he afraid, of that,” he said. “ All that remains to us is to understand that it will change us, and try to make the changes good,” . . .

Mr. Boyer said’ that the survey had convinced him that television as a medium was more direct and dynamic than radio ever was. It influenced people and their homes in a more revolutionary way. “Many educators here anc! in England are afraid of its influence,” he said. “They fear that television will alter the national habits, making people starers instead of readers and thinkers, because it tends forwards the spectacular and showy, and is apt to ignore or play down good values.”

If what Mr. Boyer said is correct, and I believe that it is, then I am not prepared to allow commercial broadcasting stations in this country to impose upon the viewers of television the type of programme that the radio stations acting for commercial interests in Australia impose upon the listeners at present. They broadcast all kinds of horror stories and thriller serials as well as low-class advertising and propaganda of various kinds. It is time that honorable members realized the importance of television and broadcasting. and the fact that television in the hands of private enterprise can adversely affect the whole nation. Let the people’s representatives in this Parliament be always in a position to determine that only the best and highest-class programmes shall be provided. I am certain that this Government is wedded not only to the commercial interests but also to the picture interests and others that would be affected by the introduction of television. American experience shows that television is gaining public acceptance at a rapid rate. Its diffusion pattern is quickly building a broad base among those who live at or near the basic wage and is constantly stimulating new interests within the family circle. It is a fact that there is a new awareness of family unity and an enlargement of the immediate circle of social relationships. Television is not yet stable or mature; it is fluid and as yet unpredictable in many aspects of its growth. But it is growing and we must take cognizance of that fact. Its growth and development will alter significantly the daily habits of Australians and all other peoples. It will have its effects on our culture, our leisure and our future. It is important and vital that the Government of the day shall keep in the hands of the people the control of this essential means of entertainment and education. American statistics show that in 1949 there were 42,000,000 homes in America that had radio sets, and that in those homes there were 81,000,000 radio sets. There were also 3,250,000 television sets in America. In this country there are 2,000,000 radio sets, but, as yet, not one television set in operation. Although I disagree with the political views of the honorable member for Henty (Mr. Gullett) I admit that he is one of the most handsome men that I have ever seen. For that reason he would have nothing to fear if the proceedings of the Parliament were televised. However, he made the remarkable statement that it would be wasteful to use materials in the construction of television stations when such materials were urgently required for the construction of houses. What would be the difference between the Government itself using those materials to construct such stations and allowing private enterprise to use the’ same materials in the construction of their own stations?

Mr DEPUTY SPEAKER:

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

Motion (by Mr. Davidson) put -

Thatthe question be now put.

The House divided. (Mr. Deputy Speaker - Mr.C. F. Adermann. )

AYES: 56

NOES: 39

Majority . . 17

AYES

NOES

Question so resolved in the affirmative.

Original question resolved in the negative.

page 731

QUESTION

INTERNATIONAL AFFAIRS

Debate resumed fromthe 4th October (vide page 300), on motion by Mr. Menzies -

That the following paper be printed: -

International Affairs - Ministerial Statement by the Prime Minister, 27th September, 1950.

Mr ROBERTON:
Riverina

.- It is not often that I inflict myself on the House on two consecutive days. This afternoon I find myself the victim of my own circumstances, because I secured the adjournment of the debate on international affairs last week, and now it ismy duty to address myself to that subject. Before I do so, I shall refer briefly to some of the observations that have been made by Opposition members in this discussion. My first reference is to the impassioned defence of the right honorable member for Barton (Dr. Evatt) that was made by the honorable member for Bendigo (Mr. Clarey), who described the right honorable gentleman as the champion of small nations.

Opposition Members. - Hear, hear !

Mr ROBERTON:

– I am glad that Opposition members agree with the honorable member for Bendigo, but I should like to comment on that statement. If the right honorable member for Barton is the champion of the small nations, may I remind him that, although Australia is large in area, it is, in point of fact, a small nation? So, too, are our sister dominion of New Zealand, and our mother country, England, and if I may be permitted to mention it, Scotland and the two Irelands. I should like to hear the right honorable member for Barton, if he is the champion of the small nations, express himself in defence of those sorely troubled small nations at this critical period in our history. That is the acid test. If the right honorable gentleman is the champion of small nations, his first manifest duty is to defend this small nation of Australia, and when he has done so, to defend our kith and kin wherever they are to be found throughout the world.

I hear the honorable member for Hind- marsh (Mr. Clyde Cameron) interjecting. I shall deal gently with him. When he was speaking on international affairs last week, he asked a very pertinent question relative to the honorable and very gallant member for Hume (Mr. Charles Anderson). He asked, in effect, “What right has the honorable member for Hume to criticize the 40-hour week as a deterrent of our defence potential?” May I ease the tension in the mind of the honorable member for Hindmarsh, and answer his question ? . Of course I know that the honorable and gallant member for Hume is competent to defend himself; but I say to the honorable member for Hindmarsh that if the honorable member for Hume has no right to. criticize the 40-hour week or any other general arrangement of human affairs in this country, no other man has the right to do so. In point of fact, the honorable member for Hume has more right than the honorable member for Hindmarsh or any one else, including myself, to voice criticism of our domestic affairs. Had it not been for him and others of his kind, there would have been no honorable member for Hindmarsh, no House of Representatives and no Parliament of the Commonwealth to-day.

The honorable member for Hindmarsh also quoted glibly from statements by gentlemen like Pandit Nehru and the Sheik Abdullah, and when I interjected, not facetiously, but to invite the honorable member to tell us what the wife of the Sheik Abdullah had to say, he took exception, and said that he was not interested in his wife. I say to the honorable member for Hindmarsh that if the Sheik Abdullah is not so happily married as I am, he is certainly more severally married than I am. The opinion of his wife is of equal impor tance, if not of greater importance than, that of the sheik himself. The same remark might apply to the honorable member for Hindmarsh. Opposition members frequently quote passages from the speeches and writings of various gentlemen in many parts of the world, but we do not hear them quote a British statesman, or His Majesty the King. Perhaps some inhibition restrains them from quoting speeches by the British king, but they do not even quote the speeches of Scottish kings. I remind the honorable member for Hindmarsh that he had a glorious opportunity to quote the address of a Scottish king, Robert Bruce, who lived more than 600 years ago. Bruce, in speaking to his army before the battle of Bannockburn, said -

Wha will be a traitor knave?

Wha can fill a coward’s grave?

Wha sae base as be a slave

Let him turn and flee!

The present Government is facing a similar situation in the same spirit. I give the next words back to the honorable member for Hindmarsh -

By oppression’s woes and pains!

By your sons in servile chains!

We will drain our dearest veins,

But they shall be free!

Those words express the view of the Government, as it has been enunciated by the Prime Minister (Mr. Menzies) in his references to our responsibilities in Korea, and to our defence system generally.

One Opposition member after another has stated that the only way in which to meet the situation that has developed in international affairs is to adopt the socialist ideology. The Leader of the Opposition (Mr. Chifley) said, in effect, “ The only solution is a form of socialism “. As I have been answering questions up to this point in my speech, perhaps I shall be permitted to ask one. If the solution of the world’s problems is a form of socialism, will the Leader of the Opposition tell me the brand of socialism that he has in mind? Is it the socialism that is advocated by himself, the socialism that is expressed by the honorable member for Melbourne (Mr. Calwell), the socialism of the honorable member for East Sydney (Mr. Ward) or that delightful form of socialism that is so adequately expressed by the honorable member for West Sydney (Mr. Minogue) ? It is futile, in a House of this description, to say that the solution of the problems of the world is the adoption of socialism, unless the speaker is prepared to qualify his view and specify the brand of socialism that he means. The idea that socialism is the solution of international problems is neither new nor novel. That procedure has been attempted in many parts of the world during the last 30 years, and wherever it has been applied in practice, it has become, in the final analysis, communism. That is thebitter experience of every socialist country, and it will be the bitter experience of this country if the Australian people accept the advice of the Leader of the Opposition or of any other member of the Opposition who has addressed himself to that subject.

In my contribution to this debate, I should like to avoid, if I can, the subtle temptation to indulge in vague political abstractions. It is so easy to move out of the Pacific, across the Indian Ocean into the Mediterranean, and from the Mediterranean into the Atlantic Ocean, thence into the Pacific Ocean and finally back home, only to find that we have not solved any of our problems. It is so easy to look at the world through the wrong end of the political telescope, and see international affairs reduced to insignificance and so utterly remote that they can be of no possible importance to Opposition members or to those people outside this chamber who follow them so blindly. It is a common practice which must be stopped by sheer reason if this country is to be saved from its enemies. It is also not difficult, even if the telescope is used in the proper way, to colour a single lens with red, pink or even blue, according to our respective political approaches, and see the world, not as it really is, but as we wish to see it. That has been done by every Opposition member who has spoken on international affairs in this debate, and it can only be described as a childish form of selfdeception.

Opposition members interjecting,

Mr DEPUTY SPEAKER:

– Order ! Some Opposition members are treating this vital debate as if it is a humorous subject. I mean to preserve order in the chamber, and ensure that the honorable member for Riverina (Mr. Roberton) is heard in silence.

Mr ROBERTON:

– I regret that what 1. have had to say has caused so much confusion, but I know that this is a matter of gr sat importance to the people of Austral. and I am certain that they will understand the situation.

We have much to do if we are to retrieve our situation in the field of international affairs. “We must re-affirm our faith as a democratic people in ourselves, in our country, and in the democratic systems and institutions that have made us what we are. Having done that, the duty of any responsible government will be to go out into the world to find an affinity with our kith and kin, and we must then discharge our responsibilities to them regardless of the cost. Having done that, we should try to find an affinity with people throughout the world, wherever they are to be found, who share our opinions and play the game of life according to the simple rules. When we have done that we can direct our foreign policy so that it will promote peace and goodwill to all mankind.

Mr THOMPSON:
Port Adelaide

– I am sure that honorable members who listened to thu remarks of the honorable member for Riverina (Mr. Roberton) must agree with mp that he made one of the most remarkable contributions to a debate on international affairs to which we have ever listened. For ten minutes he discussed everything except foreign affairs, then he devoted a similar period to a virulent attack on the Labour party, and finished up with one of .the most jingoistic utterances that I have ever heard in this House. I recall that it is four years since I made my maiden speech in this House, and the subject of that speech was foreign affairs. I hope that on that occasion I did not. inflict on the House an utterance similar to that to which we were subjected this afternoon by the honorable member for Riverina. As I listened to the honorable member’s remarks about the United Nations, I could not help realizing the amazing change that has taken place in the attitude of the antiLabour parties towards that body since it was discussed by the last Parliament. When they were in Opposition they consistently attacked the United Nations. They contended that we should dispense with the United Nations and should rest our security upon armed pacts with other nations. Of course, honorable members opposite are following the lead of the Prime Minister (Mr. Menzies), who, in initiating this debate, eulogized the work of the United Nations. When the anti-Labour parties were in Opposition they consistently attacked the Labour party for supporting the United Nations, and sneered continually at the right honorable member for Barton (Dr. Evatt), who was then Minister for External Affairs, for his efforts to preserve world peace through the United Nations. The best possible proof that could be given of their lack of sincerity at that time is to be found in their attitude towards that body to-day.

The honorable member for Riverina went out of his way to attack the Leader of the Opposition (Mr. Chifley), who, he alleged, was not prepared to provide one man or one shilling for the defence of this country. The honorable gentleman accused the Labour party of an utter lack of patriotism and an utter lack of affection for the British Empire. In support of his criticism he claimed that Labour’s war-time administration had dragged Australian troops out of the Middle East, Burma and Malaya-

Mr Roberton:

– I did not suggest that it withdrew troops from Malaya.

Mr THOMPSON:

– The honorable member said that the Curtin Government dragged some of the troops back from Malaya and left our dead and our prisoners of war there. He also said that in Australia’s direst need the Labour movement was not prepared to put Australia first, but in the next breath he condemned the right honorable member for Barton for having allegedly placed the welfare of Australia before the unity and integrity of the British Empire. Since, on his own admission, the reason why the Curtin Government withdrew Australian troops from overseas theatres to defend this country during the war-

Dr Evatt:

– It brought them back on the recommendation of all the chiefs of the Australian services.

Mr THOMPSON:

Mr Roberton:

– I was not boasting. 1 was merely expressing my gratitude for the fact.

Mr THOMPSON:

– I say to the honorable member that it is not the Labour party that is responsible for deciding just who can come and go to and from America nowadays. ‘[Extension of time granted.] The United States to-day is regarded by many people as the great democracy of the world. The honorable member for Riverina and other Government supporters are all the time holding up the United States to us as an example. Let the honorable member go to America now and try to earn his living in a job there and he will see how he will got on.

– I was going to link my remarks with the subject under discussion, and I am sorry that you interrupted me, sir. Under the electoral system to which I have referred the people will say to the members of the Labour party, “ You are the people who can best look after the foreign affairs and the interests of this country “. We know that, because of the electoral reforms we have instituted, we shall be able to give expression to what we feel on the matter, and we will be able to give the proper consideration to foreign affairs and not be turned aside by propaganda about matters such as bank nationalization and the abolition of petrol rationing. We shall be able to deal definitely with the things that mean so much to this country and its future, for the decision of the people will be, as it has been in the past, to return to office men of the people who understand the people and the needs of the people, and who are prepared to enact legislation to meet those needs as they arise.

I support the policy of the Government in relation to the Korean war because I consider that Australia must play its part and must accept its responsibilities to the United Nations. We must see that effect is given to the ideals to which we Iia ve subscribed as a member of the United Nations, and I can assure honorable members opposite that while they may disagree with us regarding methods of defence they can rest assured that we will give every co-operation that we possibly can in respect of what we believe to be the best methods of defending this country.

Mr SWARTZ:
Darling Downs

– I agree with one of the two points made by the honorable member for Port Adelaide (Mr. Thompson), but I disagree with the other. He was very critical of the lack of courage allegedly displayed by certain members of a previous government in not conscripting troops for overseas service. T take it,, then, that he fully supports the proposals of the Government that the personnel of the Australian Regular Army and the Citizen Military Forces should have the opportunity to volunteer for overseas service. I know that in that respect he is at variance with the leader of his party. I know also that other members of the Labour party are completely at variance with their leader on other matters. The honorable member made only two points in his rather long address. The second point was a definite criticism of the Menzies Government for its alleged inability to meet the defence needs of the country in the early days of the last war. He criticized it very severely and stated that when a Labour government took office in 1941 it had to do all the work of building up the armed services to a stage where we could carry on the war. I wish to remind the honorable member of the words of the late Mr. Curtin which give .a complete answer to this criticism. On the 28th May, 1941, he said -

the war has been prosecuted to the maximum of Australia’s capacity, and I doubt if any great improvements could have been made on what has been done-

That, of course, was on what had been done by the Menzies’ Government, Mr. Curtin’s statement continued as follows : - 1 have been in association with Ministers-

He was referring to the Australian Advisory War Council. He then proceeded as follows: -

The Advisory War Council and the Government have grappled with problems in a way which I believe has been as satisfactory as was possible in the circumstances.

In the brief time allowed to me I wish to refer to three points only. First, during this debate the honorable member for Parkes (Mr. Haylen) and the honorable member for Fremantle (Mr. Beazley) criticized the Government of South Korea under the leadership of Dr. Syngman Rhee very strongly. Before becoming critical of that Government, I think that one must have a full understanding of the background of the problems that it has faced since its inception in 194S. As honorable members know, Korea came under Japanese domination in 1905. In 1910 the kingdom of Korea was annexed by the Japanese Government. Korea has been subjected to Japanese occupation for 35 years. Those who have lived in countries under Japanese domination can realize that, during those years, the Koreans lived under what were virtually slave conditions. The people suffered great privations, individually and nationally. They suffered great humiliations, and performed in the main, menial tasks. During this entire period the Korean masses were kept in a state of ignorance. Even at the present-time only 10 per cent, of the population of Korea is literate. The Japanese realized that they could wield great power by keeping the masses in ignorance and they did that very effectively. Despite this fact, during the period of Japanese occupation there were a number of minor rebellions and there was one large rebellion in 1919. After this had been ruthlessly suppressed by the Japanese occupation army those leaders of the rebel parties who could do so fled from the country and quite a lot of them took refuge in China, across the northern border in Manchuria, and in the islands south of Japan. In some cases they infiltrated as far as the United States. After the rebellion of 1919 a provisional government of Korea was set up and established temporarily in China. Dr. Syngman Rhee, who had led the rebellion, was the leader of the provisional government. A person named Kim Koo was the Prime Minister. This government functioned in some sort of way until the commencement of the la=t war.

Honorable members know that in thu Cairo declaration of 1943, the United Kingdom, the United States of America and China declared that after the war Korea should become a free and independent nation. This was confirmed by the Potsdam Declaration and in the Japanese instrument of surrender which was signed in Tokio Bay. It was agreed by all the signatories to these- agreements that Korea should eventually become a free and independent nation.. The Union of t Soviet Socialist Republics was a signatory to both the latter agreements.

Since the termination of the last war, Korea has been divided into two distinct sections which, geographically, politically or in any other way were never intended to exist. Despite the remark made some lime ago by a member of the Government to the effect that, racially, the people of Korea are divided, I contend strongly that they are not. I support the Prime Minister’s statement that they are racially one. Although there are some distinctions between the north and south they are no more divided racially than Australia is racially divided between New ‘South “Wales, Queensland, Victoria and the other States. There were two major difficulties in the way of the establishment of any government in Korea after the last war. One was that the Japanese, as part of their policy of subjection, encouraged large land holdings, particularly in south “Korea, the main agricultural area. This policy aimed at establishing what has been described in this House as a kind of feudal system. Another big problem arose from the fact that at the conclusion >of the war the groups of revolutionaries who had been responsible for the rebellions which occurred throughout the Japanese occupation returned to Korea ;and took an active part in the political affairs of the post-war period. When the government was established in 1948 there were approximately 100 separate political groups functioning in Korea.

The United Nations temporary commission undertook to supervise elections for .the establishment of a national government in Korea. When it arrived there it found that the conduct of elections north of the 38th parallel was impossible as that area was under Russian domination although Russian troops had left the area by that time. Prior to the free election a government known as the National Assembly of Korea had been established in the southern part of the country. That government was not recognized by the United Nations temporary commission, and it came to be known as the “ Seoul Assembly “. Dr. ‘Syngman Rhee was appointed as its president. It was not until May, 1948, that the United Nations Commission was able to arrange for the first free election to be held, in South Korea. In the words of the report of the commission, the elections of May, 194S, proved to be a valid expression of the free will of the electors in those parts of Korea that were accessible to the commission.

The new government was faced with almost insurmountable difficulties. The people and the members of the government had had no previous training in democracy as we know it. The country was divided into approximately 100 political groups. A tremendous problem had been created by its division into North and South Korea. North Korea had the main industrial centres while South Korea was principally an agricultural area.

Taking all these factors into consideration, I think that it is the duty of honorable members, not to criticize the existing government of Korea, but to help it. I know the Koreans. I lived with them for some years. I have met good and bad Koreans, and I know what possibilities the average Korean has for the future. I think that it is the duty of Australia and the United Nations organization, not only to the Koreans, but also to the rest of the world, to teach the people of Korea democracy. I do not think that the government of the republic of Korea should be criticized at this stage. It should be encouraged to overcome its difficulties and helped to become a real democracy.

The second point to which 1 wish to refer is that of the present situation in Indo-China. To realize the problem of that country, I think it essential to have some idea of the present political and military position there. The modern history of Indo-China goes back to the years between 1862 and 1897, when France acquired this territory. In 1898, the Union of Indo-China came under the control of the French Government. Certain native territories, at that time, were still maintained on an independent basis, but came within the sphere of influence of the French Government. The most important of these was the Anna.mese territory, which has figured prominently in the news of the last few days. For 42 years this country was under French control, which did not end until the French capitulated to Germany in 1940. That event brought the close economic and military association between the province of Indo-China and France to an abrupt end. Immediately this occurred, the Japanese pressure on IndoChina commenced and, within a few months, the border between Indo-China and China was closed, despite objections by the French administration in IndoChina. Shortly afterwards, Japanese troops marched into Tongking, a northern province of Indo.China. and occupied it, but, at the same time, they agreed to recognize the French administration over the whole of Indo-China.

In the southern part of the country, pressure was brought to bear by the Thais who moved across the Thailand border and militarily occupied a portion of the territory of Laos, which was within the borders of Indo-China at the time. In July, 1941, the Japanese occupied the whole of Indo-China, excluding the southern portion of Laos, but maintained the existing French administration of the territory. When the war was drawing to a close the French administration became a little more friendly towards the allies and the allied cause. This was disturbing from a Japanese point of view, and Japan issued an ultimatum to IndoChina. It was rejected and the Japanese conducted military manoeuvres in the country and removed the French administration from office. In March, 194.5, the Japanese took complete control of the territory. At this time Tokyo announced that the Emperor Bao Dai had renounced the existing French treaty and had joined the co-prosperity sphere which was being extended as a sphere of Japanese influence throughout the Far East. At the same time the Japanese administration declared the independence of Cambodia and Laos. After the Japanese surrender to the Allies this system of independent States wa9 overthrown by a revolution led by a group known as the Vietminh. Up to this time the Vietminh had been a nationalist movement, had been active in Indo-China since 1908. In .1945 the Communist party of Indo-China gradually extended its influence into the Vietminh, and by 1.949 the Communist party of IndoChina had completely dominated the Vietminh party.

The Communist party in Indo-China. had been founded in 1930 by a person named Ho Chi Minh, a name which has some significance to-day. He had made a careful study of Marxism and had spent a considerable time in Moscow, where he was completely indoctrinated with the philosophy of communism. In 1930, Ho Chi Minh had established the Indo-Chinese Communist Party, and shortly afterwards he was imprisoned by the British for his Communist activities in this area. [Extension of time granted.’] After his return to’ China he immediately commenced to organize uprisings on the Indo-Chinese border. That was during 1940. In 1941 he founded the Vietnam or League of Independent Vietnam. He was arrested in 1943 by the Chinese National Government but was released shortly after. He again operated against the Chinese through the Vietnam. After the surrender of Japan, Bao Dai, the original Annamese Emperor, abdicated, and the Vietminh proclaimed a republic of Vietnam. At that time France was not in a position to re-occupy Indo-China, so arrangements were made with the British and Chinese Governments for British and Chinese troops to re-occupy the territory. The Chinese troops were to occupy the northern part of Indo-China and the British troops the southern part, and the French administration was to he recognized. At this time the Vietminh Government had declared itself a Republic of Vietnam and was administering the country. Certain difficulties arose when the British and Chinese troops tried to recognize the French administration. The Vietminh group was still in power, but although in the south the British did not officially recognize the Vietminh administration,, in the north the Chinese did so.

In 1945 there was a most interesting occurrence. The Indo-Chinese Communist Party was dissolved and something occurred which should make honorable members opposite think carefully. Within one month of the dissolution of the Indo-Chinese Communist Party it had been reformed and was known as the Marxist Association. The Chinese withdrew from the north of the country in 1946 and were replaced by French units. The area previously occupied by Thailand in the south was taken over by the French forces. There was an agreement between France and Vietnam in’ March, 1.946, which recognized the Republic of Vietnam within the French Union. The

French Union at that time was intended to include the Republics of Vietnam, Laos and Cambodia. A break-down of negotiations occurred between the Vietminh organization and the French Government. In July, 1946, at Fontainbleau in France, the cleavage was made wider and from that day the Vietminh’ Government has been openly opposed to the French administration. The French realized this, and Bao Dai was persuaded to return to Indo-China, where he became president of a new Government of Vietnam. From the establishment of Bao Dai’s regime in Indo-China warfare commenced between the provisional Vietminh Government and the recognized official governments in the French Union.

That is the story leading up to the present situation, but of more significance is the fact that the Vietminh Government is recognized by the central Peoples Government of China at Peking and by Russia. There are two distinct forces operating in the French Union. One is the Communist, force of Vietminh, and the other is the French and Republican force of the French Union. The present attacks on the French forces are definitely those conducted by Ho Chi Minh, whose Vietminh forces are being strongly supported by the Chinese Communists under Mao Tse-tung. Supplies, ammunition and specialist troops are being supplied at the u resent time to the Vietminh forces by Mao Tse-tung. The trouble in IndoChina is more than a border incident. It is a further advance of international communism in the East. While the pressure iri ay ease in- Korea, it is becoming stronger on the border of Indo-China at the present time. This situation that I have detailed should be closely examined and its implications should be realized so far as the future of Australia is concerned.

Finally, I refer to the third matter. During the speech of the honorable member for Parkes (Mr. Haylen), he made a. statement to the effect that he did not consider the national service proposals of the Government were necessary, and that the present Citizen Military Forces were sufficient to carry on the work required of them. I have been a serving member of the Citizen Military Forces since they were re-established in 1947. I can say definitely to the honorable member for Parkes and to other honorable members opposite that the post-war Citizen Military Forces system is a complete failure for three reasons. The first reason for its failure is its lack of numbers. The paper strength detailed to the people of Australia by the previous Government indicated that its strength was reasonably satisfactory. The majority of those figu.es. given to the public were on paper only, and the personnel was just not there. That was a form of deception practised by the previous Government, and I know from my experience that the figures it gave were completely false. The second reason for the failure of the Citizen Military Forces is that they are given insufficient periods of training. In the time allotted soldiers cannot be trained to bt efficient. They can be given only slight background training. The third reason for the failure of the Citizen Military Forces is the lack of continuity of training. Some members of the forces, for example, attend parades one night or one week-end, and stay away possibly for a long period. There is also a big turnover of personnel which means that there is an entire lack of continuity of training. Under the present proposals of the Government an opportunity exists to give complete training because personnel under the national service system are to be given three months’ continuous training with further periods of a fortnight a year and home training periods in the Citizen Military Forces. That system should ensure a reasonable standard of efficiency. It is vital that our defence system should be capable of ready expansion. When honorable members analyse the political situation in the Far East they would do well to remember the motto of an Australian Imperial Fo’ces unit of which I was once a member, lt was “ Never unprepared “.

Mr JAMES:
Hunter

– I did not intend to speak in this debate, but when I was wrongly accused of having interjected I thought that it was time that I had something to say. I also desire to answer some charges made by the honorable member for Riverina (Mr. Roberton). Apparently he tried to quote poetry. I cannot understand why he defeated his predecessor in the last general election, because that gentleman was certainly the better poet. The honorable member for Riverina accused the Opposition of being concerned only with money. Some honorable members on this side have sacrificed a considerable amount of money for the privilege ofsitting in this House. 1 refer particularly to the right honorable member for Barton (Dr. Evatt), who sacrificed a position, the salary of which was £3,000 a year, with the prospect of a pension upon retirement of £2,500 a year, for the possibility of £850 a year if elected to this House. Despite the criticism of the honorable member for Riverina, the right honorable member for Barton was one of those who was instrumental in setting up the United Nations organization, which was created precisely for the purpose of preventing future wars. On the other hand, the present Government regards the United Nations as an organization which should be used to cause war and not to avert war by agreement among its members to make available to it quotas of armed forces in order to combat aggression in any part of the world. The honorable member for Riverina said that the Leader of the Opposition (Mr. Chifley) had stated that the Labour party would not make available a man or a shilling to defend this country. I challenge the honorable member to produce his authority for that statement, because the Leader of the Opposition did not say anything of the kind. What the right honorable gentleman said was that the Labour party would not co-operate in the Government’s recruiting campaign because recruits were to be enlisted for service in any part of the world. At the same time, he made it clear that Labour would support the recruitment of forces for the defence of Australia.

I shall remind the honorable member for Riverina of certain events that occurred during World War II. What happened when the present Government parties were in office during the early part of that conflict? They quarrelled among themselves with the result that two of their supporters gave their allegiance to the Labour party and were instrumental in bringing about Labour’s assumption to office in October, 1941, because they believed that only Labour, which was then led by the late John Curtin, could effectively prosecute the nation’s war effort. That belief was fully justified by subsequent events. At great risk as leader of the Labour party, the late John Curtin succeeded in persuading the party to liberalize its defencepolicy to allow men conscripted for warservice to fight outside our shores in areas as far north as the equator. Thenewspapers, not only in Australia, but also overseas, praised the Labour party for the magnificent way that it prosecuted our war effort. In contrast, what was the record of the Liberal party when it was in office during the early years of the conflict? At that time Australia did not possess a modern aeroplane or tank, and it did not have nearly sufficient rifles with which to equip our Army. In manydistricts in my electorate I saw recruitsdrilling with broomsticks because no rifleswere available. In the industrial spherein 1942, after Labour had assumed office, coal production readied a record that has not been equalled since. When thepresent Government parties were in power previously, the Minister for External Affairs (Mr. Spender), theMinister for Health (Sir Earle Page) and the Minister for the Interior (SenatorFoll) made visits overseas. Upon their return to this country the two lastmentioned gentlemen declared that Singapore was safe. But shortly afterwards, Singapore fell to the Japanese. What contribution did the Minister for External Affairs, who was then Ministerfor the Army, make to the war effort?’ He made a visit to the Middle East and when he saw that our troops in that area were doing nothing, he suggested that the Government should send women’sauxiliary forces to the Middle East because such forces would have a. quietening, or softening, effect upon the Australian troops. About the same time, hepromoted himself to the rank of colonel.

Mr Ward:

– What for?

Mr JAMES:

– Apparently, because he had recommended that women’s auxiliary forces should be sent to the Middle East. The late John Curtin, when he was Prime Minister, was veryworried , when the Japanese entered the conflict. It is now history that when the Japanese were within 80 miles of the Queensland coast he had a wireless telephone conversation with Mr. Churchill, who was then the British Prime Minister, in which he demanded that the Australian troops in the Middle East he returned to these shores. Mr. Churchill replied, “ I cannot get sufficient ships even to transport food for the people of Britain because of the losses that are being caused by U-boats “. Mr. Curtin then said, “ I will go elsewhere “. Details of that conversation were recounted to members of the Parliament at a secret session and also at a meeting of the Labour caucus. When Mr. Churchill asked where he would go, Mr. Curtin replied, “ I will go to America “. He did so, and I say with all reverence, “ Thank God, Roosevelt answered Curtin’s call to send American troops to this country”.

The honorable member for Riverina :said that Australian troops who were serving in the Middle East were bundled hack to Australia. The Labour Government brought them back here in order to defend this country against the Japanese. Because of the action that Mr. Curtin took on that occasion some newspapers said that he was cutting the painter. To those charges he replied, “ No ; I am defending Australia. As Churchill has the duty of defending Great Britain I, ;as the first citizen in Australia, have the duty of defending it, and I shall do so “. Mr. Curtin was then living at the Prime Minister’s Lodge at Canberra, and we !know that while the troopships from the Middle East were on the water he did not have a wink of sleep because if one of those transports had been sunk the fathers and mothers of those who would have lost their lives would have blamed him for bringing back those troops without escorts and in defiance of Churchill’s wishes. If ever a man died as a casualty of war Mr. Curtin did so; and -honorable members who have criticized Labour’s administration during the recent war have done him a grave injustice. The press of Australia had nothing but praise for Labour’s war-time administration because Labour saved this country from invasion. When Roosevelt answered our call, I- admit that he could see the advantage of using Australia as an outer bastion in the defence of the United States of America; but by the same token we benefited immensely from the action that he took.

Many peculiar circumstances have arisen in the international sphere since the end of the recent war. Most honorable members will recall that Russia made a pact with Germany shortly after that conflict broke out, although just prior to doing so the Russian Government had shot 21 of its generals because they had fraternized with members of the German General Staff. We were informed at a secret session that the endeavours of the Government of Great Britain to make a pact with Russia had failed and that, following that failure, representatives of the Labour party, with the blessing of the Russian Minister in London, sent a mission to Russia to make another effort to arrange such a pact. While those representatives were negotiating with Molotov in one room, Stalin in another room signed a pact with Germany under which Russia later supplied armaments to Germany. Subsequently, however, Hitler made the fatal mistake of attacking Russia. It is useless for members of tho Communist party to say that Russia came into ‘the war of its own volition. It was forced . into the war because Hitler attacked it; and 1, personally, was thankful that he did. Prior to Germany’s attack upon Russia I met a Communist who was a. member of the miners’ management board. I said, “ Sammy, I suppose you will be back in the war now”. He replied, “ No ; no imperialist war for me “. I then said, “ But Russia is in the war now; it is not an imperialist war “. When I said that, he stopped and thought. That was typical of the attitude of the Communists in this country at that time. What happened? Shortly after Hitler attacked Russia, the Australian Communist party changed its policy and, instead of declaring that the conflict was an imperialist war, Communists said it was a just war because Russia was fighting on our side. Later still, industrial production in Australia increased substantially.

Russia has signed a pact under which it agreed to permit every nation to work out its own destiny in its own way. But is it honouring that pact at present? It is not doing so. We know what has happened in Russian satellite countries in which the people are no better off than the Germans were under Hitler. I sincerely ‘believe that Russia is bent upon world conquest. Now, when Russia is at variance with its old allies we hear the Communists in this country raising the cry, “ Ban the atom bomb ! Hands off Korea!” Whilst I do not claim to be a religious man I am a good Christian. The Labour party stands for democracy and Christianity. Sovietism and Hitlerism believe absolutely in dictatorship and totalitarianism. I do not believe in them. I am a great democrat, and I want to die a Christian democrat. Above all, I shall stand, and fight, and shed my blood in opposing any person who tries to deprive us of the right of freedom of worship.

Dr NOTT:
Australian Capital Territory

– I have listened with great interest to many speeches that have been made in this debate on international affairs. Some of them have been fiery, and have met with such fiery retorts as to make them entirely interesting. The idea has even occurred to me that it was not wholly fortuitous that Sampson selected the jawbone of an ass with which to cause such havoc among his enemies. However, I do not wish to dilate on matters of that kind. I should merely like, as an independent member of this House, and as one who is not burned up with party politics on this occasion, to express my appreciation of the Government’s most realistic approach to foreign policy. I believe that never before in the history of the Commonwealth has a Government, in time of peace, approached the problems of international relations and foreign affairs with such positive views as the present Government has approached them. The Prime Minister (Mr. Menzies) is to be congratulated on having linked in such a definite manner the foreign policy of Australia with the defence of this country, and every Australian who is prepared to devote some critical and analytical thought to the whole position will agree that a great service has been done not only to Australia but also to the Commonwealth of Nations by the right honorable gentleman, not only in the precincts of this

House but also overseas. The complete co-ordination of our foreign policy with our home defence policy, and even with’ our domestic policy, is the surest^ and,, indeed, the only method bv which we can. prepare ourselves to meet an emergency,, and enable us to play our part if, unfortunately, we should be called upon to doso. The Government has adopted a positive approach that has been neglected for too long in peace-time.

Frankly, I am one of those who, in the past, offered criticism of the United Nations. When the League of Nations rose Phoenix-like from the- crematoria! ashes of World War I., we built great hopes upon it. The whole world was animated with the belief that all the international problems and obligations that had been the dynamic force in driving countries to war, would be dispelled, and that, in the forum of the League of Nations, international difficulties would be resolved to the satisfaction of all parties. However, the League of Nations, born as it was from good intentions, and fostered and nurtured by those who trod the international stage, became an international debating society and ultimately passed away, drowned by the verbosity of the delegates who attended its assemblies. Even while our hopes were centred on the League of Nations, some men, with criminal intent, were planning for war. In the fullness of time, the world again approached the brink of conflict, and then was engulfed in World War II.

After the democracies had emerged successfully from that conflict, the United Nations arose from the cremated ashes of extraordinary destruction of human life and devastation of property. Never wa3 an organization founded in more auspicious circumstances. It had the goodwill and good wishes of many countries, and was in the hands of competent statesmen, whose place in history is assured. However, the United Nations, like the League of Nations, threatened to become verbose. Its delegates clapped the telescope to the blind eye so that they failed to see many developments that had all the pattern, of war. It is hardly necessary for me to remind the House of the many incidents affecting the peace of the world that occurred under their very noses. The Malayan incident, the Burma incident and the Indo-Ohina incident are prominently in our minds. Throughout the world, the greatest industrial turmoil in history occurred. All those developments were a part of a pattern, of events that were being fostered and encouraged in many countries. What was their origin ? Most of them were due to the infiltration of fifth columns. The honorable member for Hunter (Mr. James) has referred to the Iron Curtain that isolates the satellite countries of Russia from Western Europe. They became satellites after plans had been well and truly laid by fifth columnists who had made peaceful penetration or industrial turmoil the basis of their infiltration, until more sinister figures who had been lurking in the background were ready to seize power. Then the Iron Curtain was rung down on each satellite.

Those dramatic incidents were occurring while the United Nations was in session. When the delegates of the democracies were earnestly discussing measures to safeguard the peace of the world, Vishinsky and other Soviet delegates engaged in sabre-rattling and stage-acting, always at the crucial moment attempting, by discussions on procedure,’ to distract attention from those incidents, and to prevent the United Nations from reaching a decision that would be a contributing factor to world peace. So far as I have been able to discover, in reviewing the activities of the United Nations, no effort was ever made by the delegates to combat the greatest and most fearsome of all the infiltrations that the world has known. For those reasons, I became critical of the United Nations. I thought that it was functioning like many centenarian eunuchs would if they were discussing birth control. That was about the status that I awarded to the United Nations at that time. Then the dark clouds of war loomed on the Korean horizon, and the United Nations immediately called for support against the aggressor. Thank God, Australia was one of the first nations that answered the call, and sent forces overseas to give backbone to the United Nations action. Thanks to the United States of America, the United Kingdom, Australia, and the other countries that provided military, naval and air forces and financial aid to the United Nations, that organization will be a contributing factor to world peace in future. I believe that the Korean incident -has stiffened the United Nations, and made possible an organization that, for all time, will be a contributing factor to world peace, and will make potential aggressors think twice before they take the irrevocable step.

I consider that Australia is privileged to be a member of the United Nations, since it has proved itself a dynamic organization, but our membership imposes responsibilities upon us. One of. them, which is now obvious to every one, is that we must accept our share of military, naval and air preparedness. I was pleased to learn that the Prime Minister, in a positive fashion that will give general satisfaction in this country, has decided to dovetail foreign policy with home defence. I am astounded that any objection should be offered to the proposal that men who wish to enlist in the Army shall become liable to fight overseas. Members of the Labour party have no qualms about throwing the Royal Australian Air Force into a- hail of bullets in Korea, yet they are offering an illogical objection to the decision of the Government that the Citizen Military Forces and the Regular Army shall be available, if necessary, for service overseas. Opposition members do not object to the Royal Australian Navy and the Royal Australian Air Force fighting in any quarter of the globe. It is a quaint kind of fireside strategy to contend that we must wait until we are attacked before we may strike a blow. Under the United Nations, a global strategy may be devised in accordance with which every member of the United Nations will take its place in the field of battle. I believe that the rally to the United Nations that has taken place since the outbreak of the war in Korea has made the possibility of a global war more remote than ever.

I listened with considerable interest to the speech of the honorable member for Hunter, and particularly to the tribute that he paid to the late Mr. John Curtin. If anything, his praises of the late right honor able gentleman understated the facts. John Curtin was as definitely a war casualty as was any man who was struck down on the field of battle because of the overwhelming burden that he had to bear as the leader of this nation. Yet nobody in Australia paid a higher tribute to the war preparations of his predecessor than did he. Living in a democracy, we always hope for peace and are never fully prepared for war. Therefore, notwithstanding the sound foundations that had been laid by anti-Labour governments, a considerable period had to elapse before Australia was in a position to strike any blows of consequence against our enemies. I shall not discuss the recall of Australian forces to this country during the war. The decision to bring our fighting men back to Australia was made, I assume, upon the decisions of the war staffs as well as those of the Prime Minister and the war cabinet of the day. I offer no criticism of those decisions. I merely remind honorable members of the praise of the war-time anti-Labour governments that was uttered unstintingly by John Curtin.

I deeply regret the intrusion of rancour into a debate upon a subject which affects the very existence of the nation and which should bring forth from all parties the utmost willingness to co-operate for the good of the people. Our position to-day is perilous and it can be improved only by continued preparation for defence. The development of industry lies pari passu with the development of aerial defence. The very basis of an adequate defence plan for Australia is a proper system of aerial defence. Our air striking forces should be based well inland in readily defensible positions adjacent to industries which can provide replacements ‘promptly. Everybody should know that, in the event of war, we should be prepared for about 30 per cent. of casualties in the air in the first shock of conflict. Casualties must be replaced immediately, and properly located industries are necessary for that purpose. I believe that the Government is not unmindful of the nation’s needs in that respect. I believe also that it is. earnestly endeavouring to equip Australia to meet the dangers which threaten us, hut which will recede in the fullness of time if we pursue a positive foreign policy. As an independent member of this House who has listened to all speeches in this debate and stripped them of party bitterness, I congratulate the Prime Minister (Mr. Menzies) upon the realistic approach that he has made to a very difficult subject. I am sure that naycongratulations will be endorsed by most, of the people of Australia.

Mr PEARCE:
Capricornia

.- After listening to most of the speeches by members of the Opposition in this debate on international affairs, it was quite refreshing for me to hear the honorablemember for Hunter (Mr. James) expressthe opinion that the Communist empirethreatens the peace of the whole world. He said that the Communist empirerepresented a greater menace to the peaceloving nations than Hitler had ever been.. I join with him in that belief, and I regret that so many of his colleagues disagreewith him. In June of this year, the honorable member for East Sydney (Mr. Ward) told us that there was no danger of war and that any talk of war was mere bluff, bombast, and hypocrisy. A few short weeks later, the honorablegentleman saw the spark that was in Korea burst into a flame that spread intoa conflagration which menaced not only Korea, but also the peace and security of the rest of the world. Militarily, the tideof f ortune is with us in Korea now. Fortunately for humanity and the future of democracy, the United Nations was ableto rally its forces in time. We have been able to save face in Korea and the threat to us there is diminishing. But a great and terrible danger still threatens usfrom the Communist empire, which is the greatest empire, in numbers, and perhaps in force, that this world has known. Many of us conjecture, but none of us know where the next Communist thrust will be launched. Deep in the hearts of the most optimistic of us lies a dreadful fear that there will be another outbreak of hostilities. We do not know whereor when it may occur. We do not know what preparations to make against it.. But the people who backed the North Koreans with their might are eager and’ willing and have the initiative to move into battle against the free peoples of theworld at the hour when they are ready todo so. And when they strike the wholeworld will be shocked.

After the Prime Minister (Mr. Menzies) had made his statement on international affairs, members of the Opposition rose one after the other to tell us that we must not send our soldiers overseas. In other words, they said what their masters, the Communist-inspired and controlled trade unions, had been saying for a long time - “ Hands off Korea “ or “ Hands off “ somewhere else. I wonder whether those honorable gentlemen will be consistent if the “ red “ tide that is rolling towards Australia sweeps on until finally it touches the shores of New Guinea, as it may well do? Will they then say, “ We would not allow troops to go to Korea and so we cannot send them to New Guinea”? If the tide sweeps on to Australia, will they chorus, “ Hands off Australia “ ? Our enemy is the giant octopus of communism that straddles the world, and we do not know where it will make its next attack. The free peoples of the world have an obligation to resist communism and, if they value their lives and their security, as well as the peace and prosperity of the world, they must unite to fight the menace. Much has been said about the foreign policy that was pursued by Labour governments in recent years. I watched the activities of those governments from the sidelines and, as an onlooker, perhaps I saw more of the game than did the players. The activities of the socialist Government that preceded this Government endangered the international relations of Australia. The manner in which its immigration, policy was administered angered neighbouring nations. Its attitude towards the United Nations was short-sighted. The right honorable member for Barton (Dr. Evatt), as Minister for External Affairs, was a Communist dupe or stooge. Whether wilfully or ignorantly, he carried Communist and socialist policies right into the very heart of the United Nations, and thereby seriously threatened the peace and security of the world. Within Australia, as the socialists gradually gained might, they became power-drunk and control-crazy and sought to give unrestrained effect to their ideas about nationalization. The result was that many people whom we wanted to come to Australia, and who could have aided us, became jittery. Thus we were deprived of the help of many friends who would have settled amongst us if socialists had not been in charge of the country.

In 1946, the socialists declared that we were entering upon a golden age and were about to reap all the fruits of peace and prosperity. They told the people of Australia, “ This is your opportunity to enjoy greater wealth than ever before “. For three years prior to the election of 1949 their cry to the people was, “ Do not worry about what is * happening outside. Leave it in the hands of the right honorable member for Barton; he will handle all those problems. We are all right. We are secure and we can sell all our war equipment. We still have a .few men in the Citizen Military Forces. This is the golden age.” I believe that history does repeat itself, and my mind goes back to the fall of the great Babylonian empire after Belshazzar had succeeded his grandfather, King Nebuchadnezzar. Belshazzar, looking at the Medes and Persians arrayed outside his city, said to his people, “We have huge walls to protect us. We have farms inside those walls that can produce all the food that we need. Bring out the golden vessel and pour out the wine.” So the. Babylonians lived much as Australians lived under the Labour Administration. Their eyes were blinded to the danger that threatened them. The full might of the Medes and Persians was poised against them just as the full might of the great Russian empire has been poised outside the walls of Australia for such a long time. There came a day when the empire of Babylon fell in the midst of a feast. The people stood on the walls and jeered at the armies of Darius, the Mede, and said, “ We are safe. They will never capture us. We are living in a golden age.” That night the kingdom fell and their king was slain. It is interesting to note that the Medes entered the city through the sewers. The Communists who are trying to sabotage Australia are rising from the sewers also. Under the administration of the Labour Government we behaved just as the Babylonians did. But fortunately, though no godly hand wrote “ Finish “ to that Government’s reign, as happened in Babylon, the hand of the

Australian people took up its pencil on the 10th December last, put its mark in the right square, and elected a Government which, at the very .least, has a realistic appreciation of the dangers that threaten us from beyond our shores. We must face up to the fact that the - period in which we are now living is one of greater danger to us than has been any other. The hungry and hurt eyes of other nations are looking enviously on our wide fields, scattered population and untapped potentialities. Therefore, we must be realistic in our foreign policy. The policy that has been advanced by this Government might be expressed in the slogan, “Population, production and preparation “. Indeed, those objectives have gone forth to the people as a clarion call, and I believe that they realize that in the present Government they have a body of men which intends to govern. I think that the people also recognize the present Government’s appreciation of the difficulties that confront us, and are confident that it is prepared to populate the country, increase production and prepare us to defend our heritage in case that should become necessary.

Whilst I believe that we should support the United Nations, and that that organization affords our only hope for peace in the world, I do not think that the Government of this or of any other country can properly defend itself and co-operate whole-heartedly with the United Nations in the defence of peace while its internal security is menaced by communism. The Australian Government is being hamstrung at every turn by the antics of the followers of the former Labour Administration that was defeated so soundly at the last general election. Indeed, it is tragic that even in this Parliament the Socialist party should play the game which the Communists want them to play. By its attitude the Opposition is affording the Communists an invaluable breathing space in which to organize their defences. Although the Communists are lurking in the sewers and gutters, preparing to rise and take our kingdom from us, the Labour party says, “ Leave them alone and let them come out into the open. After all, communism is just a philosophy “. Let us be realistic and recognize that the great majority of Australians know that a Communist can never be a good Australian, a good citizen or a good Christian. All that he can be is a good Communist. After all, the Australian Communists have exactly the same outlook as have the Communists of North Korea and those in the heart of Moscow. The Communists in this country live in the hope that some day they will be able to take over Australia and substitute their way of life for the democratic freedom that we enjoy at present.

Of course, there will be no war unless Russia begins it. But how can we be assured that Russia is content with the territorial gains that it has made during the last few years? No one but a fool would believe such a thing; but, unfortunately, it appears that we have many fools in Australia and that some of them are not far from here. I listened to the honorable member for Port Adelaide (Mr. Thompson) discussing socialism, Christianity and a lot of other matters. Whilst there is no doubt that the problems which confront us at present involve great moral issues, including Christianity, it is absurd that such a professed champion of Christianity as is the honorable gentleman should use his vote in this House to assist the Communists, who are the declared enemies of Christianity. It is utterly hypocritical for the honorable member to advocate socialism, and to compare it with Christianity, while all the time he knows of the deadly struggle that is being waged by the Communists to sweep away Christianity and everything that we hold dear.

It must have been a great relief to the people of Australia to hear the speech made by the Prime Minister who initiated this debate. The result of recent Gallup polls shows that the people are confident that in the right honorable gentleman they have one who is able and ready to lead them, and who will leave no stone unturned to protect our way of life and to ensure, as far as it is possible for any government to do so, that we shall live in peace, contentment and security.

Mr MACKINNON:
Wannon

.- The debate has covered most of the matters with which our foreign policy should be concerned, and considerable emphasis has been placed on the part that

Australia must play if it is to fulfil its duty as a member of the United Nations. I think that on all sides of the House there is a genuine realization of the actualities of the situation and of the dangerous threat of war which hangs over the world. There seems also to be general agreement that the forces of communism, which are spreading over the face of the earth, constitute a most dangerous menace to the freedom of the democratic and peaceloving nations. Consequent upon the flare-up in Korea, many people have speculated regarding whether our intervention in that country would lead to another world war. I have never believed that it would, and I see no reason to alter my opinion. So long as Russia continues to gain its objectives by the methods that it has been using so successfully I do not think that it will commit itself to war. Although we believe that, fortunately, the Korean situation has reached a satisfactory conclusion, we are still confronted with immense dangers and difficulties that arise out of Communist aggression. If the future of Korea is to be determined satisfactorily the greatest statesmanship will be required from all members of the United Nations, including of course, Australia. Our successful intervention in Korea has administered a temporary check to Soviet ambitions there, but it is only reasonable to expect that Russian aggression will be manifested in other countries, particularly in East Asia. The The honorable member for Darling Downs (Mr. Swartz) stressed the significance of what is occurring in French IndoChina, and we must expect the Communists to continue to make trouble there. There is evidence of a similar situation arising in Tibet, and the conquest of that country would threaten the integrity of the entire Indian peninsula. In the Middle East and particularly in Iran, where trouble may occur over the oil deposits, we may expect further Communist intervention. In Europe, we cannot regard with equanimity the present situation in Berlin or in the rest of Germany. Those are some of the difficulties that confront us to-day. It is clear, therefore, that we must have a realistic approach to world affairs, and that those who are responsible for organiz ing the defence of this country must be alive to the dangers that beset us.

Our foreign policy and our obligations to the United Nations have three principle features. The first is, of course, defence, about which a great deal has been said in this debate. I believe that the general public is fully aware of the necessity for Australia to be ready, not only to protect itself, but also to support the United Nations. The Government believes that our security can best be safeguarded by having our three armed services available for service on our outpost lines, where they may be required by the United Nations to deal with any situation that may threaten world peace. Most, but not all, members of the Opposition have adopted the extraordinary attitude that whilst our naval and air forcesshould be available for use any where in the world, our volunteer ground forcesshould not be available for service overseas. Honorable members will notice that I have deliberately qualified my reference to members of the Opposition by using the word “ most “. It should hardly be necessary to point out that if our ground forces are not available for service overseas we shall merely repeat the mistakes of previous wars, when, in order to despatch ground forces overseas, we had to break up pur existing formations and establish an entirely separate organization which, of course, necessitated costly and dangerous delays.

The second feature of our foreign policy, which has also been thoroughly discussed during the course of the debate, is the provision of economic aid to backward countries, particularly to those inSouthEast Asia. I believe that, speaking generally, the Australian public recognizes that because we enjoy a high standard of living we should be prepared’ in the interests of world peace, tofurnish some assistance to backward peoples. The important point to bear in mind is that in conferring economic aid on backward nations we should ensure that it shall be put to proper use. In otherwords, we should insist that those nations that receive the goods and services which we supply use them for the sole purpose of raising their standard of living and so bring about a state of contentment amongst their peoples.

Another problem that hai been casually mentioned during this debate relates to education, particularly religious and political education. An analysis of the fantastic success of Communist imperialism in various parts of the world would show that it has been due, to a great degree, to the indoctrination with Communist ideology of certain elements of the populations of countries outside Russia, who had been selected for their mental and physical qualifications, and had then been sent back to their own countries to force the Communist doctrine on their own people. I think that we have in that policy a lesson that we might well study. I propose to refer at greater length to that subject, but I shall deal now with the subject of Christianity.

I recall a remark that the Leader of the Opposition (Mr. Chifley) made, in an earlier debate, concerning the rapid growth of communism in Eastern European countries. If my memory serves me aright he said that the Christian church must bear its share of responsibility for that rapid growth. I consider that to be both an amazing and an inaccurate statement, because all the world knows that the various countries concerned - Poland, Eastern Germany, Bulgaria, Roumania. Czechoslovakia, and Hungary - were not conquered from within by communism. They were conquered because of the presence of the “ Red “ army and by the assistance that the M.V.D., the Russian secret police, gave to subversive and criminal Communist elements in those countries when they acted to assume control of their governments.

Mr Haylen:

– Those countries had Communist parties before that happened.

Mr MACKINNON:

– I admit that fact, but those parties did not represent majority public opinion in those countries. It was only the pressure of the “ Red “ army and the activities of the Russian secret police that enabled those Communist parties to assume control. The honorable member for Parkes (Mr. Haylen) would be the first to admit that if ever there was a case of a country in which a free democracy was overthrown, .it was Czechoslovakia.

Mr Haylen:

– That is true.

Mr MACKINNON:

– So the statement of the Leader of the Opposition, in which he attached blame to the Christian church for the rapid ‘growth of communism in ;.the countries of Eastern Europe, and “for which, incidentally, he was taken to task at the time by a member of. his own party, quite rightly I believe, was not justifiable. An analysis of the facts will show that far from failing to combat communism the Christian church has been, and will continue to be, one of the greatest bulwarks against the future spread of communism. I suggest that the activities ‘ of the Christian church are an aspect of the struggle for world peace that might well be studied by the United Nations, and particularly by the United States and the members of the British Commonwealth of Nations. Anybody, no matter of what church or creed, will agree that there is a place in world affairs for the Christian church, not only in providing an actual example of right thinking, but also in spreading Christian education.

That point brings me back to the subject of education, particularly political education. I believe that the United Nations can achieve distinct results in this regard. As I stated earlier, I believe in learning from one’s opponent. It is an old military adage that a commander should study the character of the opposing commander. I consider that in this matter of political education we can take a leaf from Moscow’s book. I mention as an example the present educational position in Poland. A very thorough system has been developed under which, in an eleven-year period, every Polish child will have been com1pletely indoctrinated with the Moscow line. Before teachers are allowed to carry on their work they must satisfy a most comprehensive and -searching inquiry into their credentials and their knowledge of the party line. Under that system Polish children receive a normal primary education for the first three years of their schooling. The curriculum at that stage has a slightly political flavour. But in the next two or three years the indoctrination becomes more intense and more in consonance with the line of Soviet policy, until finally each child is virtually 100 per cent. Communist, with a lasting regard for the Moscow regime. Furthermore, all children are taught as a matter of historical fact that Russia is the fons et origo of everything good in scientific or artistic achievement and of everything that concerns the welfare of mankind.

Mr Andrews:

– Nevertheless, there are many defections from the Communist party in that country.

Mr MACKINNON:

– -Yes but under the system in Poland it is almost impossible for those defections to be of any importance.

Mr Calwell:

– Twenty-five thousand Russians flee to the American zone of Germany each year.

Mr MACKINNON:

– Yes, but they do so because they have had an opportunity of seeing the world outside the Soviet Union. But when people do not have the opportunity to see the outside world, and when travel by outsiders into Russia and its satellite countries is completely barred, the powers of political education are almost insuperable. Australia, as a member of the United Nations, must study this problem, because I believe that it is one in which we can, to a great degree, combat the spread of communism. Apply my argument to our own immediate neighbours. Suppose we decide that there is the risk of indoctrination by communism in New Guinea, where we have a sphere of influence. One of the first steps that we should take is to bring into our educational system as largo a number as possible of the natives of New Guinea. They should be educated by us in the spirit’ of British democracy, because it is obvious that sooner or later the New Guinea natives will take charge of their own’ country, and it would be well for us if there were available to take charge of New Guinea at that time, natives who had been trained in the spirit of British democracy.

I consider that there is a challenge which the United Nations should take up in connexion -with the points that I have mentioned,, particularly in regard to the encouragement and spread of Christianity and to the use of our political opportunities to educate people who may be influenced by communism. As a member of the United Nations, Australia should be among the first nations to support a policy that is aimed first at world peace and secondly at the preservation of free peoples and of democracy.

Mr WILSON:
Sturt

– I consider that a proper review of foreign affairs should be based on three main principles. These are, first, the strengthening of the greatest force for world peace, the nations of the British Commonwealth; secondly, the strenthening of the ties between the Englishspeaking nations, particularly the British Commonwealth and the United States of America; and thirdly, the strengthening of the ties between all the democratic nations. The Liberal party always supported the League of Nations and has always supported the United Nations. It supports the United Nations, however, only to the extent that that body is able to carry its decisions into effect. The failure of the League of Nations arose not from the fact that it did not have good intentions, but from the fact that it had no means of effectively carrying out its decisions. When the United Nations was established an endeavour was made to correct the mistake that had been made with the League of Nations. It is futile, however, to imagine that any country can, by simply passing a resolution that it supports the United Nations, consider itself thereby to be immune against aggression. The extent to which any country can rely upon the United Nations is the extent to which the. United Nations is able to give effect to its decisions. It is in that connexion that difficulties have arisen between the Liberal party and the Labour party. The Labour party seems to take the view that the mere adoption of a resolution that we support the United Nations is sufficient protection for us, and that we do not require to do anything about the defences of our own country or take any steps to see that other countries have defences. Instead, according to the Labour party we can sit down complacently in the shelter of that resolution.

The Liberal party supports the principles of the United Nations but it realizes that the United Nations is absolutely ineffective unless it has the power to enforce its decisions. The prestige of the United Nations is higher now than it has ever been for one reason alone, which is that when the North Koreans invaded South Korea the United Nations was fortunately able to act quickly because the United States, Great Britain and Australia happened to have forces serving near Korea that were able to be brought into action to carry out the decision of the United Nations.

Mr Chambers:

– No, I said that it had failed to co-operate in the recruiting campaign.

Mr CHAMBERS:

– If the honorable member peruses the Hansard record he will find that he said that the Labour party had failed to support the Government in connexion with the Korean disturbance. He also said that we had failed to give our support to the recruiting campaign. Let us now investigate the circumstances surrounding the despatch of Australian servicemen to Korea. This Government would not have been able to answer the request of the United Nations had it not been for the activities of previous Labour governments in raising military forces which were available in Australia and overseas when the Korean war began.

– Our policy was to expend that sum on defence during five years. No Liberal government ever expended more than £5,000,000 in any year of peace.

I should not have participated in this debate had not the honorable member for Stuart asked for the cooperation of the Labour party and said that we should drop party politics in international affairs. Notwithstanding that request the whole of his speech was a tissue of mean party politics. He accused’ the Labour party of not being interested in the Australian nation or the Australian people despite the fact that that party saved this country and put some confidence back into the hearts- and minds of its people after the Liberal party had let them down. The Australian Labour party was so well thought of that when Australian soldiers came back to Australia in 1946 they showed their appreciation of it. It ill becomes the honorable member to launch a personal and mean attack against the Labour party, under subterfuge of a speech on international affairs. That party has done more for the defence of Australia than the Liberal party has ever thought of doing since federation.

Then the honorable member brought communism into the debate and asked where the Australian Labour party stood on that issue. I am just as concerned about communism as is the honorable member for Sturt. I remind him that honorable members on the Government side have made much of the fact that saboteurs on the waterfront are causing- disturbances, and refusing to load ships with war materiel for Korea. If that is true, the Australian Government is falling down on its job in not prosecuting those saboteurs and putting them in gaol. If honorable members on the Government side want to bring communism into the debate let them say what is to prevent the Australian Government from arresting the leader of the waterside workers and other leaders of Communist-controlled organizations. Let us be fair about these things and act on them, not just talk about them. If honorable members on- the Government side wants to stop such people from sabotaging Australia’s welfare, then at least they should act against them under the powers that already exist.

I repeat, that it was a mean attempt on the part of the honorable member for Sturt to attack the Labour party in the guise of a debate on international affairs I remind him that the Leader of the Opposition (Mr. Chifley) stood shoulder to shoulder with the Prime Minister on the floor of this House and said, “We shall give you every co-operation in the Korean war “. That support has been forthcoming. Had it not been for the effort and foresight of the Australian Labour party there would not have been any forces or equipment available for Korea when the United Nations called upon its members for support. There would not have been a force so well equipped that the Minister for the Army paid a tribute to it.

Mr Turnbull:

– How does the honorable’ member know that?

Mr CHAMBERS:

– The Minister will not deny having made the statement I have quoted. If any other honorable member on the Government side wants to take a mean advantage of my party, let him do so on the adjournment or at some other appropriate time. Let him not use a debate on international affairs to do so. This is merely a mean attack on the great Australian Labour party which has so well served the people that before long they will realize that They made an error on the 10th December last and will replace the Government with one that has the real interests of the country at heart.

Mr ANTHONY:
PostmasterGeneral · Richmond · CP

– The honorable member for Adelaide (Mr. Chambers) worked himself into a fury in an attempt to defend the Australian Labour party against so-called attacks. He claims to have revealed the failure of the present Government parties during the early war years and pre-war years to prepare for the adequate defence of Australia. That would be a very serious charge indeed, if it could be sustained. When one passes beyond the region of rhetoric such as has been indulged in by the honorable member and gets to the facts of the case, one realizes that in regard to the attitude on defence of the Australian La.bour party during the pre-war years, particularly in 1939, 1940 and 1941, they are vastly different from what the honorable member has pictured them to be.

Mr Ward:

– The Minister should not work himself into a fury.

Mr ANTHONY:

Mr TRELOAR:

– Opposition members do not like what I have said. Talk of capitulation was not confined to the War Cabinet, and could hardly have been a rumour, because we have heard it all over the place. I. should like to know who those two Ministers were. It was general talk that quite a number of supporters of the Labour party, which claims to have done such a wonderful job during the war. said that we were linked and that the best thing that we could do was to make the best terms that we could with Japan. I myself heard that in numbers of places. Yet they are the people who now el aim that the Labour Government had a wonderful war effort. If the people of

Australia had really known what had happened behind the scenes and in the’ minds of those persons, and how they had delayed the preceding Government in its war efforts, they would never have been returned to the treasury bench. But the trouble is that they are the best mob orators I know, they are marvellous mob psychologists, and they live on class hatred.

The Leader of the Opposition (Mr. Chifley) said in this debate that he could understand hatred of Russian imperialism and of several other things. Personally, I cannot understand hatred. The greatest trouble in this country is that there is too much hatred. I do not say that I hate Communists, because it is not in me to hate anybody, but I shall do everything in my power to see that those people do not disrupt this country, and upset our defences and production.

As I said at the beginning of my speech, I had no intention of speaking in this debate, but I was practically forced to do so by the habit of Opposition members of continually thrusting down the throats of the people of Australia the story about the Labour Government’s great war effort.

Debate (on motion by Mr. BRYsoN adjourned.

Sitting suspended from 5.5k to 8 p.m.

page 763

ESTIMATES 1950-51

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, 1951, and recommending appropriations accordingly.

Ordered to be printed, and referred to the Committee of Supply forthwith.

page 763

QUESTION

BUDGET 1950-51

In Committee of Supply:

Mr FADDEN:
Treasurer · McPherson · CP

– It is my privilege to present Estimates of Revenue and Expenditure for the financial year 1950-51 and details of actual revenue and expenditure in 3949-50.

The proposals in this budget, and the related financial measures which will be brought down this session, arise from a complex national situation - a situation which carries many difficulties and risks but which also has great possibilities for good if it can be guided wisely.

Australia at the present time is in the midst of a vast and many-sided movement of expansion, to which two strong forces are contributing. Of these forces, one is the need for security, brought so urgently before us by events abroad in recent times, and the recognition that for security we must have far greater economic strength ; the other is the faith, held almost universally in Australia and by .many people abroad, that this country is capable of immense progress in .the coming years.

Under the stimulus of these ideas, governments and all their connected authorities are pushing on with large programmes of works to provide power, fuel, water, transport, housing, hospitals and schools for a larger population and a more highly developed economy. Private firms, in all branches of production, are increasing their present capacity or launching new projects to meet the wider demands of the future they foresee. Immigrants are pouring in from overseas, eager to try their fortunes and build new lives in this country. Immense amounts of capital are coming here, a great part of it for permanent investment.

In times like these, real and substantial progress is always made. Population grows, industries are built, new resources are opened up; and these are permanent gs;ins.

There is, however, a danger under such conditions that the effort to expand will out-run resources and spread itself too widely. Then you get bottlenecks, competition for scarce labour and materials and a bidding-up of prices and costs. These are the familiar growing pains of a vigorous economy.

For a considerable time past it has been clear that something of the kind is happening in Australia. Many types of labour have been scarce, and remain scarce, despite the inflow of migrants; the turn-over of labour in various industries has been extraordinarily high ; there have been chronic shortages of coal, steel, various building materials and other commodities; and progress in many undertakings has lagged because the resources to complete them could not be procured.

The problem has been greatly accentuated by a large and increasing surplus of purchasing power in the hands of the public. To some extent this purchasing power has been created in the process of industrial expansion, through higher expenditures on wages, materials and so on. There have, however, been other sources as well. There have been the large unspent balances carried over from the war, when commodities were scarce, prices were pegged and people earned much more than they could spend. There has been the large inflow of overseas capital and there has been the steep increase year by year in the proceeds of our exports, especially of wool.

By creating a demand for commodities greater than available supplies, the existence of this purchasing power has stimulated investment in all kinds of industries, so intensifying competition for resources already too scarce to go around. It has acted directly on prices and wages and all the other elements in costs, causing them to rise in a cumulative way, each rise in one factor leading to further rises in the rest.

This situation had been developing for a long time before the present Government took office last December. Prices and costs had been rising rapidly long before then; the shortages of coal, steel and other key materials had existed ever since the war and they were steadily becoming worse.,

In its approach to this situation the Government has been determined that migration and essential development shall go on, and, so far as possible, be accelerated. It is convinced that the general economic problem must be attacked in fundamental ways and not by mere palliatives. In particular, it holds that there must be a vast increase both in production and in the resources for production.

With these ends in view, the Government brought down legislation to deal with those enemies of Australia who working through the trade union movement, were organizing industrial strife and deliberately fostering practices which hold back production. It abolished obstructive and unnecessary controls, such as petrol rationing. It intensified efforts to relieve labour shortages in basic industries, where lagging output has been retarding progress throughout every branch of the economy. It has don, everything in its power to encourage essential imports, especially of those items most needed by industry and constructional works. It has remitted duties under by-law on a great number of articles and it has subsidized imports of coal and prefabricated houses.

Obviously under circumstances such as the present, we should obtain from abroad as much as we can both of equipment and materials for production and of finished consumable goods. “The overseas supply position, which was so difficult in the early post-war period, improved considerably in the past year or two, especially in the United Kingdom ,and also in Western Europe, and a rapidly increasing volume of imports is now coming forward. The removal of currency difficulties under the European Payments Union has helped to increase the flow of goods from important industrial countries such as Belgium with which we had previously been able to trade only on a strict hard-currency basis.

In 1949-50 the value of imports to Australia was £537,000,000, which represented an increase of £122,000,000 on the previous year. In this financial year, we can expect a further very substantial increase, although the speeding up of defence preparations abroad may cause serious and increasing difficulties in obtaining some of the commodities we need.

At 30th June this year, the total international currency reserves of Australia stood at £650,000,000. A substantial part of this large total, however, has been accumulated through the temporary inflow of capital, and when allowance is made for this fact and for the greatly increased value of imports and exports as compared with earlier years, the total cannot be regarded as excessive for our requirements. If we are to obtain the still greater quantity of imports we need, it is important that we should have adequate international reserves against the contingency of a fall in our export earnings or a reduction of the inflow of capital.

In one other vital direction the Government lias acted to improve the availability of supplies from abroad. When the Government took office, supplies from the dollar area were still narrowly restricted and producers in this country did not have access to many types of plant, equipment and machinery which can be obtained only from North America but which are absolutely essential to the efficient running of our basic industries and the progress of our developmental plans. The Government recognized the gravity of the general dollar problem and it has co-operated to the full with the United Kingdom and the other sterling area countries in measures to economize in the use of dollars. It was not satisfied, however, that enough had been done in a positive way by borrowing or otherwise to make more dollars available for developmental purposes. Accordingly, the Prime Minister (Mr. Menzies) made it one of the chief objects of his visit abroad in the middle of this year to explore the possibilities of raising a dollar loan. As you know, he was successful in negotiating a loan of 100,000,000 dollars from the International Bank for immediate’ use in purchasing vital equipment for agriculture, industry and developmental construction. Furthermore, by arrangement with the International Bank, a mission will visit Australia early next year to study our developmental requirements for dollars over a period of five years.

As the Prime Minister has said, the loan by no means removes the dollar shortage. It remains necessary to economize strictly in dollar expenditure. What the loan does, however, is to give Aliustralia the chance to get key types of equipment which will have enormous value in raising the productivity of our industries and furthering the progress of developmental works. I am convinced that the loan will prove to be one of the best bargains this country ever made and that, in terms of increased national output and efficiency, it will repay itself several times over.

During the brief period the Government has been in office, there have been two developments which must tend to increase the difficulties of the general economic problem. One is the worsening of the international position, as indicated by the outbreak of hostilities in Korea where Australian forces have been actively engaged as part of. the United Nations forces. The consequent speeding up and expansion of defence preparations will be directly reflected in the budget, as I shall explain later. It will, however, also intensify the problem of resources, because men, materials and equipment for defence must have high priority. As yet, the numbers of men and the quantities of material needed are not great; but these requirements are likely to increase and, as they do, the question of priorities in the use of our resources, as between defence, developmental and other uses will become progressively more acute. It is with this situation in view that the Government proposes to set up a National Security Resources Board which will have the task of examining our civil and military resources and needs and making recommendations to the Government on national planning and priorities.

Furthermore, as the Prime Minister has announced, the Government will establish an organization to supervise the general allocation of key materials. It is also proposed to re-institute the Capita] Issues control.

The other development has been the sensational rise in wool prices, notably during the past few months. Wool prices have tended generally to increase ever since auctions were resumed after the war and last season the average price was 63d. per lb. greasy. This was nearly six times the average price in the years 1936-39 and the wool cheque of £300,000,000 last season was nearly six times as great as those of pre-war years. The recent market, however, has risen far above last season’s levels. Whilst future trends in the market are impossible to predict, if current prices hold throughout the season, the clip will bring between £450,000,000 and £550,000,000. That is to say, the wool cheque will be somewhere between £150,000,000 and £250,000,000 greater than the record cheque of 1949-50.

This rise in wool prices will add to our international reserves and from that standpoint it can be counted a national advantage because of the larger quantity of imports we will be able to buy. The internal consequences, however, could be very disruptive unless firmly controlled. To make a further great addition to the volume of purchasing power, not matched by an equivalent quantity of additional goods, would increase competition for available supplies and divert resources still further from developmental activities into less essential uses. This would tend to disperse and weaken the national effort at a time when it should be more and more concentrated. Moreover, there would be direct effects on the cost of living because of higher prices for clothing and meat and this in turn would lead to higher wage costs throughout the whole economy. Within the wool industry itself, property values would soar to boom levels and wages and other working costs would rise, thus weakening the long-term position of an industry whose strength throughout the years has lain in its ability to produce wool at competitive cost levels.

The Government will therefore bring clown measures to restrain the effects which this excess purchasing power would have upon the economy. I shall give the main details of these measures at a later stage. Here let me say that the interests of the wool industry will be fully safeguarded. The Government has no desire to take from a body of producers, who have had a full share in past adversities, the good fortune which has now come their way. Means must be found, however, to harmonize the interests of the wool industry with those of the community as a whole and this is what the legislation to be submitted by the Government seeks to do. By requiring wool-growers to make certain prepayments of taxation in this financial year, it will hold off a substantial part of the excess purchasing power to which the increase in wool prices has given rise. On the other hand, by giving to growers credits for these pre-payments and enabling them to. use these credits to meet tax obligations at a later date, it will ensure that they are not permanently deprived of the gains which the present high wool market should bring to them.

These special factors apart, the Government recognizes - and it is highly important for everyone to recognize - the implications for the community of a major programme of migration and development. Both add to the calls upon our resources. Although migrants increase our labour force - they have already made notable contributions in certain key industries and elsewhere - they also add to demands for housing, transport, schools, hospitals and all the other facilities of community life - demands which even now are far from being satisfied and which for the most part can only be met from local labour and supplies. Essential development in turn, requires a concentration of resources on those projects, such as power supply, transport, housing and the expansion of basic industries which are most vital to the progress of the economy. When to these necessities are added the immediate over-riding demands of defensive preparedness, it becomes obvious that, almost as in time of war, the primary tasks of the nation must have a stronger claim than ever on our energies and wealth even though this may mean that other wants and projects, justifiable in themselves though not so urgent, must bide their day.

The rise in prices we have experienced is a product of this general situation. In part, it represents an adjustment of the Australian economy to conditions overseas where, during the war and post-war years, prices and costs in most countries rose much further and faster than here. In part it springs from forces within our economy - the excessive purchasing power of which I have spoken, the competition for labour and materials, the lag in output of basic industries, and the scarcity - which is only now being remedied - of essential supplies from overseas.

Comprehensive measures for dealing with these problems have been stated by the Prime Minister and I do not propose to re-state them here. In their financial aspect, however, they are necessarily reflected in budget policy as to revenue and expenditure, to details of which I shall now turn.

Revenue and Expenditure, 1949-50

Excluding the self-balancing items, total revenue in 1949-50 was £567,000,000 which was £35,000,000 greater than the budget estimate.

The main increases over the estimates were customs £17,000,000, sales tax £7,500,000 and income tax and social services contribution £3,500,000.

Total expenditure in 1949-50 was £592,000,000, this being £25,000,000 greater than the estimate.

The principal items in which increases occurred were post office ordinary services £5,600,000, subsidies £4,200,000, capital works and services £4,800,000 and departmental expenditure £2,400,000.

The amount transferred to the National Welfare Fund was £123,300,000. This was £2,300,000 greater than the estimate because of greater collections of social services contribution and pay-roll tax. Expenditure from, the fund was £92,800,000, which was £7,600,000 le3s than the estimate. The net addition in 1949-50 to the balance in the fund, including interest received, was £31,200,000.

Expenditure on defence services fell short of estimates by £5,700,000, of which £2,500,000 was in respect of ordinary services and £3,200,000 in respect of capital works and services.

The deficit for 1949-50 was £25,000,000 as compared with the budget estimate of £35,000,000..

Details of actual revenue and expenditure in 1949-50 compared with the budget estimates are contained in Statement No. 1. With the consent of the committee this statement and other statements to which I shall refer later, will be included in Hansard without being read.

Estimates of national income and expenditure in 1949-50 are contained in a separate paper which is being circulated with the budget papers.

Loan Transactions, 1949-50

During the year two loans were raised in Australia. Three and one-eighth per cent, securities for eleven to fourteen years and 2 per cent, securities for three years, were offered for both loans, which were issued at par. The total amount received in these loans was £199,000,000, of which £124,400,000 was new cash and £74,600,000 represented conversions of maturing securities. After providing £18,600,000 from cash subscriptions to redeem unconverted securities, £105,800,000 was available for Commonwealth and State purposes.

No conversion operations were undertaken in London. A Victorian loan of £6,055,000 sterling, which matured on 1st October, 1949, was paid off at maturity from funds provided by the Common.wealth Bank and the National Debt Sinking Fund.

Details of loan transactions are given in Statement No. 10.

Defence Services, 1950-51

On the basis of existing commitments the estimate of expenditure on defence services in this financial year is £83,000,000, compared with actual expenditure in 1949-50 of £54,000,000. In addition, provision will be made for stockpiling certain types of strategic stores and equipment.

The three-year defence programme which the Government has announced, began on the 1st July, 1950, and will extend to the 30th June, 1953. It comprises, broadly, the remaining two years of the previous five-year programme, together with additional measures adopted by the Government in the light of the changed international situation.

These measures include the introduction of national service, under which training will commence in the course of this financial year, the establishment of a Citizen Air Force active reserve, the re-establishment of women’s services in the Navy, Army and Air Force, the production in Australia of the latest highspeed bomber and of the latest development in Jet-propelled fighter aircraft as well as extension of present contracts for a type of jet fighter now in production in Australia, the modernization and conversion of existing destroyers and a new naval construction programme which will extend over several years.

Provision has been made in the above estimates for the forces in Malaya and Korea and also for the very substantial increase in pay of the forces which the Prime Minister lately announced.

The Government is keeping defence preparations under the closest possible review having regard to the rapidity with which the international situation is changing.

Details of defence services are contained in Statement No. 4.

War and Repatriation (1939-45) Services

On the basis of existing commitments, net expenditure on war and repatriation (1939-45) services in 1950-51 is estimated at £106,000,000, compared with expenditure of £9S,700,000 in 1949-50.

Estimates for this year include £30,600,000 for war gratuity. This amount, together with the balance of £36,700,000 in the war gratuity reserve, is intended to cover the payment of outstanding war gratuity, due on 3rd March, 1951, and estimated at £67,300,000. Details of war gratuity are contained in Statement No. 6.

On the other hand, expenditure in 1949-50 included the United Kingdom grant of £10,000,000 and payment of £2,S00,000 under the International Monetary Agreements Act in consequence of devaluation of our currency in terms of the dollar.

War pensions in respect of the 1939-45 war are estimated at £12,300,000 on the basis of present rates and conditions, as compared with £10,500,000 in 1949-50. Proposals for improved rates and conditions of war pensions will be detailed later.

Miscellaneous credits in 1950-51 are estimated at £5,900,000, compared with £12,600,000 in 1949-50.

Details of war and repatriation 1939-45 services are contained in Statement No. 5.

Capital Works and Services

This group of items includes purchases of plant, machinery and equipment, both overseas and in Australia, as well as expenditure on constructional works, acquisition of property and other items of a capital nature.

Estimates of expenditure in 1950-51 reflect the influence of an improved supply of labour and greater availability of materials and equipment from abroad, as well as the general rise in wages and costs of materials.

The works programme as a whole has been most carefully examined by a subcommittee of Cabinet, assisted by a departmental committee, to ensure that only works of the highest priority are included. Reductions of approximately 20 per cent, have been made in the departmental schedules originally brought forward and the Government is aiming to ensure that, in carrying out the programme, there will be no undue competition for available resources.

I might mention, too, that a very large proportion of the Estimates, especially for authorities such as the Post Office, represents expenditure overseas. Its effects, therefore, will not be inflationary, because no additional demand will be made on local resources.

Expenditure on Post Office works and services in 1950-51 is estimated at £26,250,000. Actual expenditure last year was £19,500,000. The increase is mainly attributable to improving deliveries of equipment from overseas.

Provision of £9,300,000 for immigration works and services represents an increase of £2,000,000 over expenditure in 1949-50. £8,300,000 is set down for buildings and sites as against £5,300,000 spent in 1949-50.

An amount of £6,000,000 has been included in the Estimates for the Snowy Mountains project. Expenditure last year was £2,500,000, so that the estimated increase is £3,500,000. Work in the current year will be concentrated on. branches of the project which are planned to provide substantial blocks of power in ‘about four years’ time. _ Provision of £25,000,000 for war service homes in 1950-51 represents an increase of £9,000,000 over expenditure last year from Consolidated Revenue and trust fund balances. More rapid progress is being made with the building programmes and it is expected that about 15,000 homes will be made available to ex-service personnel in this financial year. It is proposed that this year expenditure on war service homes be financed from loan fund instead of Consolidated Revenue as in 1949-50.

Details of capital works and services are contained in Statement No. 7.

Immigration

Expenditure on Immigration ordinary services in 1950-51 is estimated at £13,200,000 as against actual expenditure of £8,900,000 in 1949-50.

Additional provision this year is mainly on account of Dutch, Italian and German migration, free and assisted passages for British migrants and the equipment of workers’ hostels for displaced persons. As already mentioned, £9,300,000 is being provided for capital works and services connected with immigration, compared with £7,300,000 spent last year. Thus the total expenditure on immigration in 1950-51 is estimated to be £22,500,000, which will represent an increase of £6,300,000 on last year’s expenditure.

Other Expenditure

On the basis of existing legislation and commitments, total payments to States in 1950-51 are estimated at £104,200,000. Payments last year amounted to £101,100,000.

Through the operation of the formula under the States Grants (Tax Reimbursement) Act, the tax reimbursement grants this year will reach £70,400,000, an increase of approximately £S,000,000 over the grant in 1949-50. On the other hand, payments to States last year included the coal emergency grant of £8,000,000.

Proposals for an additional reimbursement grant and roads grants will be detailed at a later stage.

On the basis of present legislation and tax rates, the amount which would be transferred to the National “Welfare Fund in 1950-51 is estimated at £132,000,000. Adjustments will, however, be made in this item in connexion with taxation proposals to be indicated presently.

Expenditure on existing subsidies in 1950-51 is estimated at £24,400,000. This amount includes £11,300,000 for subsidy on butter, as against £8,000,000 last year, £3,200,000 for subsidies on imported coal, £7j000,000 for tea subsidy and £1,500,000 for subsidy on imports of prefabricated houses. Details of subsidy payments are contained in Statement No. 9.

Estimated post office expenditure of £49,800,000 in 1950-51 represents an increase of £5,300,000 over expenditure of 1949-50, this being due mainly to increased wages and salaries and costs of materials.

Estimated expenditures in 1950-51 on railways, £3,100,000 and the national broadcasting service, £3,400,000, show increases of £300,000 and £500,000 respectively on actual expenditure last year.

Estimated departmental expenditure of £33,700,000 represents an increase of £3,500,000 over expenditure last year. The Government has given special attention to this field of expenditure. Almost immediately on taking office, the Government set up a Cabinet committee to review the Public Service generally. This Cabinet committee has been assisted by an advisory committee comprising a chartered accountant and three of the most senior public servants. There have also been ad hoc committees of experienced public servants or wellqualified persons from outside the service to carry out special investigation. Acting on the advice of these bodies, the Government has abolished three departments, re-distributed functions as between departments, curtailed some departmental activities and reduced departmental establishments. The work of the committees is being continued.

The Government also proposes to approach the States with a view to convening, under an independent chairman, a conference of Public Service Commissioners of the Commonwealth and States, together with outside persons of administrative experience, to find out to what extent there is avoidable over-lapping between Commonwealth and State departments.

Total Expenditure 1950-51

On the basis of existing legislation and commitments and excluding selfbalancing items, total expenditure in 1950-51 is estimated at £691,000,000 as compared with actual expenditure of £592,000,000 in 1949-50.

Estimates of Commonwealth expenditure from revenue in 1950-51, compared with actual expenditure in 1949-50, are contained in Statement No. 3.

Public Accounts Committee

Because of its concern at the trend in public expenditure and because of its view that parliamentary control of public finances should be made as effective as passible, the Government proposes to re-constitute the Public Accounts Committee. This committee was established by legislation in 1913 and operated until 1932 when it was suspended as an economy measure.

Revenue Estimates, 1950-51

Total revenue in 1950-51, on the basis of existing legislation and rates of taxation, is estimated at £631,000,000. Revenue in 1949-50 was £567,000,000. The estimated increase in this financial year is therefore £64,000,000.

Customs duties, which last year showed a large increase over the previous year, are estimated to increase again substantially in 1950-51. The estimate is £92,000,000, an increase of £14,000,000 over 1949-50. The value of imports which last year was £122,000,000 greater than in the previous year, is likely to vise again this year by a large amount.

Excise in 1950-51 is estimated at £70,000,000 as compared with £66,000,000 in 1949-50, an increase of £4,000,000.

The estimate of income tax in 1950-51 is £213,000,000 as against actual revenue of £179,000,000 in 1949-50. Social services contribution is estimated at £106,000,000, compared with £100,600,000 last year. Thus revenue from these two taxes, on the basis of current legislation, is estimated to be nearly £40,000,000 greater than in 1949-50.

On present rates sales tax is estimated at £51,000,000, an increase of £9,000,000 above revenue in 1949-50.

Pay-roll tax is expected to yield £26,000,000 in this financial year, an increase of £3,000,000 over 1949-50. Revenue from other taxes is expected to be about the same as last year.

The total amount of revenue from sources other than taxation is estimated to be £57,500,000 which is £4,600,000 less than actual revenue in 1949-50. In that year there was a transfer of surplus balances of trust accounts amounting to £6,700,000. This year the amount available for transfer is only £900,000.

Post Office revenue on the basis of existing rates and charges is estimated at £41,200,000 compared with £38,300,000 in 1949-50.

Estimates of Commonwealth revenue in 1950-51, on existing legislation and rates, compared with actual revenue in 1949-50, are contained in Statement No. 2.

The estimates I have given of revenue and expenditure for tins financial year do not, of course, allow for the effects of the decision on the basic wage announced by the Commonwealth Arbitration Court to-day. The matter is being examined, but beyond saying that the broad effect will be to increase both revenue and expenditure, I am not able to indicate at this stage what the precise result will be. I can say, however, that it will not be such as to require substantial recasting of the budget as a whole.

Loan Council Programmes, 1950-51

The Australian Loan Council, which met early in September, approved a borrowing programme of £175,400,000 during 1950-51 for public works and services of governments. It was further decided that 75 per cent, of the total amount be borrowed now and, if any of the States required it, that the balance of the amount in its programme be raised as requested.

Approval was also given by the Loan Council for the Commonwealth to borrow 100,000,000 dollars from the International Bank for Reconstruction and Development.

In addition to the foregoing, the Loan Council approved of a total borrowing programme of £70,600,000 for semigO’Vernmental and local authorities.

Financial Outlook and Policy, 1950-51

Estimated national income in 1949-50 was £300,000,000 greater than in the previous year, wage and salary payments were £140,000,000 greater and gross value of rural production £160,000,000 greater. Everything points to further large increases during 1950-51.

Under conditions such as these, there is a plain obligation on governments and all other public authorities to ensure that their outlays do not outrun their receipts from normal sources. To meet expenditures from bank finance, and so add further to the volume of community spending power, would be wholly indefensible. In practical terms, revenue from taxation, business undertakings, and other current sources, together with the proceeds of public loans, ought to be adequate to cover all expenditures, either on current or on capital account.

In this context, Commonwealth revenues, together with the amount of cash likely to be raised by public loans during the financial year, may be taken as constituting the pool of financial resources available.

On the other hand, Commonwealth expenditures (which include payments of more than £100,000,000 a year to .the States) together with State loan programmes, comprise the commitments to be financed.

This year, as I have shown, Commonwealth expenditure is likely to increase very considerably, mainly because of new defence requirements and the expansion of immigration and development plans.

An amount of £30,600,000 has been provided in the Estimates for payment of war gratuity. There is, in addition, a war gratuity reserve of £36,700,000 created by appropriations in previous years; but as cash will have to ‘be provided to cover this amount as well as the balance included in this budget, the total amount, of cash to be found for war gratuity in this financial year is £67,300,000.

Proposals will be outlined presently for additional payments to the States, increased rates of war pensions, increased rates of age and invalid pensions, and extensions of health services. If adopted, these proposals will of course increase the estimates of expenditure I have given earlier.

State loan programmes, as submitted to the Loan Council, are also much larger than State loan expenditures last year. This is due to progress in State public works made possible by greater availability of labour, materials and equipment, as well as to rising costs.

It may be that a substantially larger amount of cash can be raised by way of public loans in this financial year than in 1949-50. On the other hand, options become available in the course of this financial year in respect of large amounts of securities carrying relatively high rates of interest and subject to costly tax concessions. Both Commonwealth and State governments have important interests in either converting these securities at lower, rates of interest or else redeeming them. If operations of this kind are undertaken, considerable amounts of cash may be required for redemptions, so diminishing the amount available for other purposes.

The Government has made a thorough survey of the whole financial position, taking account of revenue, loan and expenditure prospects, and the likely impact of budget measures upon the general economic situation. Whilst making every effort to eliminate unnecessary expenditure, it has had to face the probability that some forms of expenditure especially in the defence field, will continue to rise strongly. It has been concerned particularly to ensure that, in this time of high and rising incomes, government finance shall not contribute to inflationary pressure by recourse to central bank credit through treasury-bills. In the light of these considerations it has formed the conclusion that, subject to action necessary to correct anomalies and relieve hardship, present sources of revenue .from taxation must be preserved and, further, that when rising export prices are adding to inflationary pressure, special forms of financial action should be used in due measure to correct these effects.

Expenditure Proposals

I shall now outline certain proposals which will be submitted to Parliament, involving expenditures additional to those for which provision has been made on the basis of existing legislation.

Strategic Stores and Equipment Reserve

In view of developments overseas and the necessity to increase our defence preparations, the Government has decided that measures should be taken to build up in Australia reserve stocks of certain key materials and equipment needed for the defence services and war industries. An estimate of expenditure on these purchases during the current financial year is difficult to make, but it has been thought advisable to include provision, of £50,00.0,000 in the Estimates for the purpose. Legislation will be brought down to establish a Strategic Stores and Equipment Reserve Trust Account, to which it is proposed to transfer the abovementioned amount.

Payments to the States.

Including proposals to be detailed presently, total provision made in the Estimates for payments to the States in 1950-51 amounts to £111,200,000. Despite the fact that the coal strike emergency grant of £8,000,000 will not be payable again in 1950-51, payments this year involve an increase of £10,000,000 over 1949-50.

During the last five years, payments to the States have more than doubled. With total payments running at over £100,000,000 in the last two years, it is clear that financial assistance to the States represents a very substantial commitment for the Commonwealth budget.

Review of Commonwealth-State Financial Relations

At the recent Premiers Conference, it was suggested by the Commonwealth that a complete review should be made of the financial relations between the Commonwealth and the States. The Premiers indicated their readiness to participate in such a review and it is proposed therefore to convene a special conference with the Premiers to consider this difficult and complex problem.

Additional Tax Reimbursement Grant

Under the formula in the States Grants (Tax Reimbursement) Act, it is estimated that the tax reimbursement grant payable to the States in 1950-51 will amount to about £70,393,000, an increase of £7,8 56,000 over 1949-50.

At the Premiers Conference held last month, the Premiers indicated that they were confronted with substantial budget difficulties this year, particularly by reason of the effects of rising costs on State expenditure. After considering all circumstances, the Government proposes to make available to the States this year an additional tax reimbursement grant of £5,000,000. As this special grant will be payable only in 1950-51, the formula embodied in existing legislation will not be amended. Separate legislation to give effect to the proposal will be introduced.

Commonwealth Aid Roads Grant

For the last three years roads payments to the States have been made in accordance with arrangements laid down in the Commonwealth Aid Roads and Works Act 1947-49. This legislation expired on 30th June last and the Government has been giving very careful consideration to the nature of the arrangements which should operate in the future.

The matter was discussed with the Premiers last month and it is proposed to introduce legislation shortly to authorize a new scheme of roads payments.. All payments under the new legislation will be financed from the proceeds of petrol taxation, the proposed hypothecation for roads purposes being 6d. per gallon customs duty on imported petrol and 31/2d. a gallon excise duty on locally-produced petrol (excluding in each case aviation spirit). These allocations are expected to yield about £12,000,000 in 1950-51, or approximately £2,700,000 more than the payments made last year under the former legislation. Payments in future years will, of course, increase with every rise in petrol consumption.

The roads grants to the States will fall into two categories, one grant being for general roads purposes and the other grant for roads in rural areas. The purposes for which these grants may be employed are, however, considerably wider than in the old legislation, whilst explicit provision will be made to enable State governments to make any portion of the grants available to local authorities.

The new arrangements will operate for a period of five years as from 1st July, 1950. Pending the passage of the new legislation, road grants to the States are being continued on the basis laid down in the Commonwealth Aid Roads and Works Act.

With the passage of the proposed legislation, the Commonwealth will be making a further substantial contribution towards the development of the road systems of the States.

Controls over Prices and Rents.

In each of the last two years, legisla tion was passed providing for the States to be reimbursed by the Commonwealth for additional expenditure incurred by the States by reason of their assumption of controls over prices, rents and land sales. The States have abandoned control over land sales but have requested the Commonwealth to continue to reimburse them in 1950-51 in respect of the cost of the controls over prices and rents. The Government has agreed to this request and legislation to authorize the grants will be introduced shortly. It is estimated that these grants will amount to £660,000 in 1950-51 as compared with £706,000 in 1949-50.

Further details of payments to the States are given in Statement No. 8.

War and Service Pensions

Substantial increases in war pensions are proposed. The special rate war pension for totally and permanently incapacitated members is to be raised from £5 6s. to £7 a week and the 100 per cent. general rate war pension for incapacitated members f rom £2 15s. to £3 10s. a week. The pensions payable to the wife and each child of a special rate or 100 per cent. general rate war pensioner are to be increased by 6s. 6d. to £1 10s. 6d. a week and by 2s. 6d. to l1s. 6d. a week respectively.

The war widows pension is to be increasedby 10s. to £3 10s. a week and the domestic allowance of 7s. 6d. a week now payable only to war widows with one or two children is to be raised to10s. a week and will be payable to all war widows who have children or who are 50 or more years of age. The war pensions payable to the first and each of the remaining children of a war widow are to be increased from 17s. 6d. to £1 2s. a week and from 12s. 6d. to 15s. 6d. a week, respectively. The war pensions for orphans where both parents are deceased is to be raised to £2 a week, the increase being £1 2s. 6d. a week in the case of orphans fourteen years of age and under and £1 a week in other cases.

It is also proposed to increase service pensions by 7s. 6d. to a maximum of £2 10s. a week.

Other proposals include increased medical sustenance allowances, increased pensions for widowed mothers, increased allowances for war pensioners with certain specified disabilities, the removal of certain time limits for dependants and the provision of specially equipped motor cars for certain disabled ex-servicemen.

The cost of the war and service pensions increases and the repatriation proposals is estimated at £5,800,000 in a full year and £3,900,000 in this financial year.

C.R.T.S. andre-establishment Living Allowances.

It is proposed to increase by 7s. 6d. a week the living allowances payable to C.R.T.S. Trainees and to settlers under the war service land settlement scheme and the business re-establishment allowances for ex-servicemen engaged in agricultural and other occupations.

The additional expenditure involved is £160,000 for a full year and £107,000 in 1950-51.

Social Services

Child Endowment

The amendment of the Social Services Consolidation Act to provide child endowment of 5s. a week for the first child under sixteen years of age took effect as from the 20th June, 1950. The number of families receiving child endowment in this financial year as compared with 1949-50 will therefore be increased by some 450,000 to about 1,110,000 and the number of endowed children from 1,130,000 to about 2,240,000.

The full year additional cost of £15,000,000 which will be payable this year will raise expenditure on child endowment to £45,600,000 in 1950-51.

Age and Invalid Pensions

It is proposed to increase age and invalid pensions by 7s. 6d. to a maximum of £2 10s. a week. The additional expenditure involved is estimated at £8,250,000 for a full year and £5,500,000 in this financial year.

The increase of 7s. 6d. a week in these pensions will result in an automatic lifting of the maximum permissible income (inclusive of pension) of a single pensioner from £3 12s. 6d. to £4 a week and in the case of a man and wife both eligible for age pension from £7 5s. to £8 a week.

Widows’ Pensions

It is also proposed to increase the class

A widows’ pension, that is, the pension payable to a widow with one or more children, by 7s. 6d., to a maximum of £2 15s. a week; and to increase the widows’ pensions payable to other classes of widows by 5s. a week.

These proposals will, it is estimated, raise the cost of widows’ pensions ‘by £700,000 for a full year and £500,000 in this financial year.

Miscellaneous

The Government will also propose amendments to raise from £200 to £500 the exemption for means test purposes of the surrender value of life assurance policies and to exclude war pensions from income in assessing unemployment and sickness benefits.

Health Services

On 4th September, 1950, amended regulations under the Pharmaceutical Benefits Act came into operation. A comprehensive range of life saving and disease preventing drugs is now available without charge to all sections of the community when prescribed by a registered medical practitioner. This scheme, together with the free supply of pharmaceuticals in hospitals, is estimated to cost £2,300,000 this year and £3,000,000 in a full year.

As a means of improving nutritional standards, the Government is planning free milk supplies to all school children through the instrumentality of the States. The scheme is expected to cost about £1,500,000 in a full year and £500,000 in the current financial year.

The States have been approached as a preliminary to the review of the hospital benefits agreements which expire shortly, and those negotiations are proceeding.

The Government is also developing its plans for a medical benefit scheme. An amount of £2,000,000 has been included in the Estimates of the National Welfare Fund to cover the cost of medical benefits in the current financial year, including a general practitioner service and a wide range of medicines for age, invalid, widow and service pensioners and their dependants.

Expenditure on these additional social service and health benefits will of course be met from the National Welfare Fund.

National Welfare Fund

The social service and health proposals I have outlined, together with the en- dowment of the first child and the normal increase in the number of beneficiaries,, will raise estimated expenditure from the National Welfare Fund to £122,000,000 in 1950-51.

This will be nearly £30,000,000, or almost one-third, greater than actual expenditure from the fund in 1949-50.

After making allowance for taxation adjustments, payments to the fund in this financial year are estimated at £127,000,000, made up of pay-roll tax £26,000,000, social services contribution £71,000,000 and a special appropriation of £30,000,000. (The need for this special appropriation will be explained in connexion with the taxation proposals, which I shall relate presently.) Payments to the fund in 1949-50 were £123,300,000.

Including interest the estimated excess of receipts over expenditure in this financial year will add £6,000,000 to the balance of the fund which now stands at £131,000,000.

During a full year, however, the increased rates proposed and the new benefits which have operated since the 1st July last, would cost nearly £5,000,000 more than they are estimated to cost this year. Moreover, the number of beneficiaries - particularly those receiving child endowment and age pensions - can be expected to increase rapidly.

Furthermore, any additional services, especially in the field of health, can be expected to involve heavy financial outlays.

It has become clear from the trend in receipts from those sources from which payments to the National Welfare Fund have been made in recent years that the income of the fund will before long fall short of expenditure from the fund.

At present there is a large credit balance in the fund. It has to be borne in mind however that the fund is, in large part, intended to provide a reserve against adverse circumstances such as the occurrence of unemployment or a fall in the revenues from which payments to the fund are made.

As I have explained on a number of occasions, the balance in the fund is invested in securities which the Government itself must provide cash to redeem. Under present circumstances it would add to inflationary pressures if more were spent from the fund than is currently being received from taxation sources.

Obviously, therefore, in view of present trends in receipts and expenditure of the National Welfare Fund, the basis on which it is financed will have to be reexamined. The need to do this will be all the greater if any progress is to be made towards removal of the means test. The Government is at present giving urgent attention to this complex matter.

Details of the National Welfare Fund are contained in Statement No. 12 and details of Commonwealth social and health services 1938-39 and 1950-51 in Statement No. 13.

Commonw ea lth Superannu ation Pensions.

In view of the steep increase in the cost of living within the last three years, amending legislation will be introduced to provide that, pending the general review of the superannuation scheme in 1952, the value of the first eight units of pension, where the contributions therefor are required to be madeto the Commonwealth Superannuation Fund, be increased by 20 per cent. The benefit of this increase will be extended to pensioners who were contributors to the fund, to present contributors on retirement and to the widows of such pensioners or contributors. Similar amending legislation will be submitted in regard to pensions payable under the Defence Forces Retirement Benefits Act. Comparable action will also be taken in respect of future benefits from the Provident Account of the Superannuation Fund. The estimated cost is £340,000 in a full financial year and £227,000 in 1950-51.

Subsidy on Woollen Goods.

Asa means to offset the effects of recenthigher auction prices for wool on prices of woollenproducts used locally, the Government proposes to pay a subsidy inrespect ofsuch goods produced in Australia for local use. An amount of £20,000,000 is being provided for this purpose. Details will be announced later.

Taxation

Income Tax

As I have said earlier, the Government considers that in the light of the infla tionary economic situation and of present and prospective expenditure commitments, it is necessary to preserve existing sources of revenue, so that no general reduction can be made in rates of income tax this year. Nevertheless, the Government proposes to make certain major reforms in the taxing system which will in themselves contribute in an important way towards amelioration of the tax burden.

The major reforms which the Government proposes are -

to merge income tax and social services contribution into a single levy upon incomes ;
to revert to a system of deductions for dependants and other concessional allowances instead of the present rebates of tax and to liberalize the concessions;
to adjust the rates to enable the foregoing reforms to be effected smoothly ; and
to. simplify the method of expression of the rates of tax.

Since the adoption of the scheme of uniform taxation, there has been widespread complaint of the complexity which has been introduced from time to time into the system of taxing incomes. I am confident, therefore, that the proposals of the Government will meet with universal approval, and constitute a landmark in the history of taxation legislation in this country because they will so simplify our system that it will be understandable to all those called upon to contribute to the revenue. The reforms and concessions contained in these proposals will provide relief in particular to taxpayers with family responsibilities, heavy medical expenses, superannuation and like payments. These proposals cannot be implemented without some loss to revenue. However, the loss estimated at £7.000,000 in the current financial year and £.15,000,000 in a. full year, is considered to be more than justified by the benefits which will flow to all classes of taxpayers as a result of the simplification of the system and ease of calculating and checking their liabilities.

The avowed purpose of the social services contribution when introduced in 3 945 was to provide a firm basis for the financing of the National Welfare Fund.

It is the strong conviction of this Government that the financing of the National Welfare Fund should continue to be on a firm basis, but this Government is equally convinced that such a basis can be provided without the bewildering complexities consequent upon the division of income tax into two separate levies, each progressive over its own range.

It is unnecessary for the proper protection of the National Welfare Fund for separate calculations in all their ramifications to be made. The National Welfare Fund can be fully protected and taxpayers assured that their contributions are devoted to the purposes for which they are made without recourse to the confusing procedure of the past five years.

Although much has been made of the separation of the two levies to engender the belief that special sections of the community have contributed only to funds for social services, under the weekly deduction scale applied to the salary or wages of 2,500,000 taxpayers, no separation of the two levies is, in fact, made. One amount and one amount only is deducted and the amount deducted may be used to meet liability for either social services contribution or income tax. Thus, for the great majority of taxpayers, the separation of the income tax field into two levies is fictitious rather than real.

So far as conversion of the system of concessional rebates to concessional deductions is concerned, the simplification achieved will be of a major character. In association with the slight adjustments which are proposed in the rates at various points, the result will he that taxpayers generally who are entitled to dependent allowances or to allowances in respect of superannuation, medical expenses, &c., will benefit to a small extent.

At the same time, every taxpayer will be able to calculate his taxable income by simply subtracting his allowable deductions from his assessable income. The change which is proposed in the basis upon which the rates are declared will enable any taxpayer in the simplest possible way to arrive at the amount of tax and contribution payable on any given amount of income.

It is proposed to print the scale of rates on the back of assessment notices in such a manner that the tax and contribution payable on any taxable income can be readily ascertained.

The proposed simplified scale of rates, which will retain sufficient flexibility to enable any desired change in the incidence of taxation to be made in the future, will be expressed in pence without the present complications of decimals or fractions of a penny. The rates will apply to income steps of £50, or multiples of £50, but will be so designed that the liability will not differ materially from that under the existing scale.

Ready-reckoners will be required for official purposes only and these will be simple booklets replacing the large and complicated volumes at present in use.

The proposals in connexion with the deductions to be allowed for dependants and expenditure on such items as medical expenses, superanuation payments, and the like, whilst achieving much greater simplicity by making the tests of maintenance, &c, uniform, will also confer benefits through being made more liberal.

It is proposed -

to raise the maximum age for the student child allowance from nineteen to 21 years;
to rationalize the allowance for dependent parents so that a partial allowance will be granted to taxpayers who partially maintain parents;
to increase the maximum medical expenses in respect of which a taxation concession is allowable from £50 to £100 for each person ;
to extend the concession to medical expenses incurred by the taxpayer on behalf of any dependant on whose account he is entitled to a deduction;
to raise the maximum dental expenses subject to the concession from £10 to £20 for each person;
to allow deductions in respect of any therapeutic treatment or medical or surgical appliance, provided that such treatment or appliance is ordered by a legally-qualified medical practitioner ;
to allow a deduction for funeral expenses up to £30 in respect of each dependant for whom the taxpayer is entitled to a concessional deduction;
to increase the present maximum in respect of life insurance premiums, superanuation fund contributions and similar payments from £150 to £200; and
to extend that allowance to include contributions to medical and hospital benefit funds.

The annual loss of revenue due to these concessions is estimated at £1,500,000 in a full year. The cost to revenue in the present financial year will be negligible.

Company Tax,

Although no reduction is being made in the rates of tax payable by companies, an adjustment is being effected in the basis of taxation of the undistributed profits of private companies. This adjustment will enable private companies to retain an additional amount of profits free from undistributed profits tax. This increased freedom from undistributed profits tax will tend towards a closer approximation of the weight of tax on private companies and their shareholders and the weight of tax on partners in a comparable partnership.

Special Appropriation to National Welfare Fund

In my reference to the NationalWelfare Fund, I indicated that a special appropriation of £30,000,000 to the fund will be necessary in the current financial year.

The appropriation will replace the provisional contribution that would be payable if contribution and tax were imposed as separate levies. This appropriation will ensure that the element of social services contribution contained in the single levy will be applied to the provision of social service benefits only and that the resources of the fund will not be adversely affected by the merging of the contribution and the tax. When added to the £71,000,000 which will he appropriated directly, it will bring the total appropriation to the same amount as it is estimated it would have been if provisional contribution had been separately calculated.

For the financial year 1951-52, it is estimated that the amount of social services contribution payable as a separate levy on income of past years will not exceed £10,000,000.

It is proposed that, in 1951-52 and subsequent years, the fund will have an assured income estimated at no. less than it would have had if the existing provisions had continued. This matter will be dealt with when the National Welfare Fund Act is submitted to Parliament to give effect to the appropriation to the fund for the current financial year.

Sales Tax

A comprehensive review has been made of the sales tax law. As a result, it is proposed to remove certain anomalies and assist housing construction by removing the tax from such items of building requisites as still remain in the taxable field. The most notable item in this category is builders’ hardware. Certain foodstuffs are also being removed from the taxable field. Full details of these exempted items will he given when legislation to effect the changes is introduced later to-day. The loss of revenue in a full year will approximate £1,000,000 and in the current year approximately £640,000.

It is proposed to increase the rate of sales tax on certain goods, the manufacture and sale of which are considered to cause inordinate competition for materials in short supply and skilled man-power. It is hoped that the discouragement of the higher rates will check, to some extent, the growth of this competition for materials and man-power which could be better employed in the production of more essential goods. The additional revenue which it is expected will be obtained as a result will be about £10,000,000 in a full year, or approximately £7,500,000 in the current year. The goods affected will be enumerated in legislation to be introduced later to-day.

Increased Business Profits

During the post-war period, it has become increasingly evident that, in many sections of commerce and industry, the pressure of purchasing power has raised business profits to inordinate levels. To a large degree, these profit increases are not the gains of normal business enterprise and activity but the direct result of high prices for commodities in strong demand. In their turn, increased profits add to the strength of the forces of inflation.

As part of an organized and balanced plan to bring these inflationary forces under control, measures are under consideration to draw off some part of the abnormal profits.

As a first essential, however, the best methods must be devised to ensure that there will be no injury to the basic structure of commerce and industry and that any system adopted will operate fairly and equitably as between all taxpayers. The various methods that maybe employed for this purpose are receiving close examination at the present time.

Wool Deductions

As I have mentioned earlier, grave con cern has been expressed, even by leaders in the wool-growing industry, at the prospect of a further upward thrust in the inflationary spiral following the increase in the nation’s wool cheque. Although this is an occasion that demands prompt action on the part of the Government, it is not an occasion when we should be led into discriminatory and sectional action against the wool industry. Increased profits in the wool industry should be subject to taxation on the same basis as taxation of other primary producing industries, and in any event should notbe taxed more heavily than industry generally.

There is, however, a pressing need to prevent the increased sums being realized for wool from adding to the inflationary pressure. The Government’s proposal is that a proportion of the proceeds of wool sales should flow to revenue in anticipation of the income tax that will ultimately become payable by the producer. Effect to this proposal will be given by requiring wool-selling brokers and dealers in wool to pay to the Taxation Department onefifth of the amount realized on the sale of wool. These amounts will be held to the credit of the producers and will be applied in payment or part payment of the income tax payable by the producer on that income. This proposal imposes no extra tax on wool producers but merely requires earlier payment of the income tax that will be subsequently assessed. If price increases reflected in wool sales so far held are maintained throughout the season, the amount of deductions is estimated to be £103,000,000.

The proposal will be explained in full when legislation to give effect to it is introduced later.

Postal and Telegraph Charges

As a consequence of increasing wages, cost of materials, rail freights and similar factors it has been found that inescapable expenditure of the Post Office this year is likely to exceed revenue by a considerable amount, despite the increases in tariffs enacted last year, and in the light of trends in revenue and expenditure, this deficit would tend to increase rather than diminish. The Government will therefore propose certain increases in postal, telegraph and telephone charges, details of which will be given shortly when legislation is brought before the House. These increases in rates which will operate from a date to be approved by Parliament, are expected to yield additional revenue amounting to- £6,700,000 in a full year.

Revenue and Loan Finance

For a number of years past it has been the practice in Commonwealth budgets to show all items of expenditure, except Advances to States for Housing, as charges to Consolidated Revenue Fund. Any deficiency between revenue and expenditure has been shown as a charge to Loan Fund for War Services. This practice had advantages under war and post-war conditions when there had to be a greater degree of flexibility than usual in budget procedures to meet rapidly changing and unforeseeable circumstances. However, it conflicted in various respects with sound accounting principles, especially where capital items of a recoverable nature were made a charge against revenue. This year it is proposed to vary the procedure by excluding two such items of expenditure - War Service Homes and War Service Land Settlement - from Consolidated Revenue and charging them along with Advances to

States for Housing to Loan Fund. The total estimated expenditure involved ii £29,000,000. Details of estimated expenditure from Loan Fund in 1950-51, compared with actual expenditure in 1949-50. are contained in Statement No. 11.

Budget Summary

Bringing into account the revenue and expenditure proposals just outlined, the budget for 1950-51 may be summarized as follows : -

Conclusion

In this financial year, it is even more difficult than usual to predict with certainty the trend of factors which determine the outcome of budgetary plans. On the basis of the estimates I have given, however, and the various revenue and expenditure proposals 1 have set forth, it should be possible to finance the whole of Commonwealth expenditure this year without resort to treasury-bills and that, as I said earlier, should be a prime objective of public finance under present inflationary conditions. Indeed, since a considerable amount of the budget expenditure will be overseas, it can be said that the budget makes a substantial contribution to anti-inflation measures.

I may remind the House, that, in this financial year, the Government is being called upon to finance the very large, though non-recurring, item of war gratuity and that, in addition, it has to meet a major increase in defence expenditure that was wholly unforeseen a year ago..

I have emphasized, as the Prime Minister has done elsewhere, the imperative need to concentrate energies and resources on those tasks which will best serve the national purposes of Australia in this critical time. Because inflation tends to scatter and waste resources, this budget has been planned, as part of the general economic policy of the Government, to restrain inflationary pressures.

Let me make clear, however, that the policy embodied in this budget is in the best sense progressive. As evidence of that, let me point to the very large provision we have made for developmental works and immigration, for roads and other payments to the States, for increased war and civil pensions, for child endowment and, above all, for an adequate defence programme. This Government does not stand for restrictionism. On the contrary it believes in giving the fullest play to worthwhile initiative. To-day, the tide of initiative in Australia is flowing strongly. The Government is concerned solely that its course shall lead to the richest fields of national endeavour.

STATEMENT No. 8.- COMMONWEALTH PAYMENTS TO OB. FOR THE STATES.

Tax Reimbursement Grants.’

Following the decision of the Commonwealth Government to continue uniform taxation of incomes and entertainments indefinitely, provision was made in the States Grants (Tax Reimbursement) Act 1946 for payment of tax reimbursement grants to States which did not levy income taxation. This legislation set out the basis on which the aggregate tax reimbursement grant was to be determined for payment in 1946-47 and in subsequent years and also the basis on which the aggregate grant was to be distributed among the States each year.

Legislation was passed in 1947 and 1948 amending the basis for determining the aggregate grant, but the basis of distribution of the aggregate grant between the States was left unchanged.

Under the States Grants (Tax Reimbursement) Act 1946-1948, the aggregate grant was fixed at £40,000,000 in 1946-47 and £45,000,000 in 1947-48, whilst in respect of subsequent years the act provides for the aggregate grant of £45,000,000 to be varied in accordance with a formula which takes account of -

Variations in the States’ populations since 1st July, 1947; and
1. The percentage increase (if any) in the level of average wages per person employed over the level in 1945-46.

The aggregate grant paid to the States in 1949-50 in accordance with this formula amounted to £62,537,000 whilst it is estimated that the amount payable in 1950-51 will be about £70,393,000.

The aggregate grant was distributed among the States in 1946-47 and 1947-48 in accordance with the first schedule to the 1946 act. In respect of years subsequent to 1947-48 the act provides that the aggregate grant is to be distributed in accordance with a distribution formula which takes account to an increasing extent each year of the respective populations of the States after adjustments have been made to those populations for relative sparsity of population and the number of school children aged five to fifteen years inclusive in each State. The effect of this distribution formula in respect of the grant for 1950-51 is to provide that seven-tenths of the aggregate grant be distributed among the States in the proportions laid down in the schedule to the 1946 act and the remaining three-tenths in proportion to the adjusted populations of the States. By 1957-58 the aggregate grant will be distributed solely in proportion, to the adjusted populations of the States.

The estimated grants payable in 1950-51 are compared below with the grants in the four previous years:

The tax reimbursement grants paid annually to each State are reduced by the amount of any arrears of State income taxation which may be received in that year by the State. In 1949-50 these arrears amounted to £267,000 and are estimated at £119,000 in 1950-51.

Additional Tax Reimbursement Grant.

Following discussions at the Premiers Conference in September, 1950, it is proposed to make available to the States in 1950-51 an additional tax reimbursement grant of £5,000,000.

This grant will be distributed among the States in the same proportions as the tax reimbursement grant payable in 1950-51 under the States Grants (Tax Reimbursement) Act 1946-48. It is estimated that the share of each State in this additional grant of £5,000,000 will be as follows: -

Legislation to authorize the payment of this grant in 1950-51 will be introduced shortly.

Coal Strike Emergency Grant.

In 1949-50 a special non-recurring coal strike emergency grant of £8,000,000 was made to the States to alleviate the burden placed on State budgets by reason of the coal strike, coal shortages and the associated effects.

The grant was distributed among the States in the same proportions as the tax reimbursement grant paid in 1949-50. The distribution among the States of this grant was as fellows: -

Special Grants

Special grants under section 96 of the Constitution have been paid annually by the Commonwealth to Western Australia since 1910, to Tasmania since 1912, and to South Australia since 1929. With the establishment of the Commonwealth Grants Commission in 1933, the special grants paid each year to these States have been in accordance with the recommendations of the Commission.

The general principle adopted by the Commonwealth Grants Commission over the years is that of financial needs and has been expressed by the Commission in the following terms: - “ Special grants are justified when a State through financial stress from any cause is unable efficiently to discharge its functions as a member of the federation and should he determined by the amount of help found necessary to make it possible for that State by reasonable effort to function at a standard not appreciably below that of the other States”.

In its seventeenth report, the Commonwealth Grants Commission has recommended that special grants aggregating £12, 175,000 be paid to South Australia, Western Australia and Tasmania in 1950-51. The commission’s recommendations have been adopted by the Government and legislation to authorize the payment of the grants will be introduced shortly. The special grants recommended for payment in 1950-51 are compared below with the special grants paid last year: -

Commonwealth Aid Roads Grants

During the three years ended on the 30th June, 1950, roads payments to the States were governedby the provisions of the Common- wealth Aid Roads and Works Act 1947-1949. This act expired on the 30th June, 1950, and new legislation will be introduced shortly.

The Commonwealth Aid Roads and Works Act 1947-1949 provided for the following payments to be made from Consolidated Revenue: -

Payment to the States each year of a sum equivalent to 3d. a gallon customs duty and 2d. a gallon excise duty collected under the relative tariff items in respect of petroleum and shale products entered for home consumption during each year of the above-mentioned period, excluding duties payable on goods used in civil aircraft for the purposes of civil aviation.
Payment to the States in respect of roads in sparsely settled areas of £1,000,000 in 1947-48, £2,000,000 in 1948-49 and £3,000,000 in 1949-50.
Provision of £500,000 by the Commonwealth each year for the construction and maintenance of strategic roads and roads of access to Commonwealth property.
Provision of a sum aggregating £100,000 to be used by the Commonwealth in the promotion of road safety practices.

The main features of the new legislation to be considered by Parliament are as follows: -

The new legislation will operate for a period of five years as from 1st July, 1950.
Provision will be made each year for purposes of the act of a sum equivalent to fid. a gallon customs duty and31/2. a gallon excise duty collected under the relative tariff items in respect of petroleum and shale products entered for home consumption, excluding duties payable on goods used in civil aircraft for the purposes of civil aviation.
Payments each year under the new legislation will fall into the following categories: -
Grant to the States for general roads purposes.

These purposes will include the construction, reconstruction, maintenance and repair of roads and the purchase of road-making equipment. Provision will be made that the States may allocate any portion ofthis grant to local authorities for general roads purposes.

Grant to the States for roads in rural areas other than highways, trunk and gazetted main roads. This grant would he available for roads such as developmental roads, feeder roads, roads in sparsely settled areas and in soldier settlement areas and roads in country municipalities and shires.
Payments by the Commonwealth for strategic roads and road safety of up to £500,000 and £100,000 respectively.

Expenditure from ConsolidatedRevenue under the Commonwealth AidRoads Works

Act is compared below with the estimated expenditure in 1950-51 under the new legislation : -

Administration of Prices and Rent Controls.

The States took over the administration of prices, rents and land sales controls towards the end of 1948 and the Commonwealth agreed to reimburse them for the additional cost in which they would be involved in 1948-49 by reason of their administration of these controls. Provision was made accordingly in the States Grants (Administration of Controls Reimbursement) Act 1948. The grants continued in 1949-50.

Land sales controls have been discontinued by the States and the Commonwealth has agreed to continue reimbursement of the cost of administering prices and rent controls in 1.950-51. New legislation to authorize the grants will be introduced shortly.

Payments to date have been -

Payments under Financial Agreement.

Under the Financial Agreement, which was entered into between the Commonwealth and the States in 1927, the Commonwealth agreed to contribute certain amounts towards meeting the interest and sinking fund payments in respect of the States’ debts.

The agreement provides that the Commonwealth will in each year during the period of 58 years commencing on 1st July, 1927, contribute a fixed amount of £7,584,912 towards the interest payable on the State’s debts.

The sinking fund contributions made by the Commonwealth in respect of the States’ debts vary according to the nature of the borrowings and may he described briefly as follows : -

In respect of States’ debts existing on 30th June, 1927, the Commonwealth contributes 2s.6d. per cent. per annum and the States 5s. per cent . per annum for 58 years.
In respect of borrowings to meet State deficits incurred between the 1st July, 1927, and the 30th June, 1935, the Commonwealth contributes 5s. per cent. per annum and the States concerned 15s. per cent. per annum, such contributions to continue for 39 years from the 1st July, 1944. This provision was made in an amendment to the Financial Agreement in 1944. No sinking fund contribution is made by the Commonwealth in respect of any other borrowings to meet State deficits.
In respect of new borrowings by the

States after the 1st July, 1927 (other than for deficit purposes), the Commonwealth and the States concerned each contribute 5s. per cent. per annum for 53 years.

The Commonwealth contributions in respect of sinking fund on States’ debts are paid direct to the National Debt Sinking Fund. In 1949-50 the Commonwealth contributions amounted to £2,004,778, whilst the contributions in 1950-51 are estimated at £2,170,088.

Western Australia Waterworks Grant.

Under the Western Australian Grant (Water Supply) Act 1948, the Commonwealth agreed to provide financial assistance to the Western Australian Government in respect of a scheme for the reticulation of water to certain agricultural areas in the north-eastern portion of the State’s mixed wheat and sheep belt, and also for the provision of domestic water supplies to certain towns along the Great Southern Railway. The Commonwealth financial assistance is limited to one-half of the capital cost of the project, with an upper limit of £2,150,000. The grunt was considered to be justified because of the developmental possibilities of the project and the limited financial resources of the State.

Up to 30th June, 1950, payments to the Western Australian Government amounted to £37,367. An amount of £637,000 has been provided in the Commonwealth Budget for 1950-51. encouragement of Meat Production.

Following the Commonwealth’s undertaking to the Government of the United Kingdom to promote development schemes which offer a good prospect of increased meat supplies for export, the Government is pressing on with measures designed to stimulate the development of the pastoral industry in northern Australia. The provision of new and improved facilities for the movement of cattle both by road and stock route is proceeding in the Northern Territory, in the Channel country of south-west Queensland and in the area serving the meatworks at Wyndham, Western Australia. The Governments of Queensland and Western Australia are responsible for the constructional work within their respective States and Commonwealth financial assistance is being afforded to them in accordance with the States Grants (Encouragement of Meat Production) Act 1949.

Commonwealth expenditure during 1950-51 on these developmental projects is estimated as follows: -

Coal-mining Industry - Long Service Leave.

In the States where coal-miners have been awarded long service leave by the industrial tribunals concerned, viz., all States except South Australia, the State Government have agreed to reimburse employers in the coal industry the amount of the costs they incur individually in granting the leave awarded their employees.

The Commonwealth has in turn agreed, to reimburse the States the amounts paid and the administrative costs incurred by the States in giving effect to these arrangements.

To provide the funds required for these purposes ah excise has been imposed on coal under the Coal Excise Act 1949. An amount equivalent, to the proceeds of the excise is appropriated to a trust account under the State Grants (Coal Mining Industry Long Service Leave) Act 1949-1950.

Summary

Estimated payments to or for the States in 1050-51, as shown in Part IV. of the Consolidated Revenue Fund, are compared below with the actual payments in 1949-50: -

Butter, Cheese and Processed Milk Products. - In accordance with a guarantee given by the Government for the five years as from the 1st April, 1947, farmers’ returns from hotter, cheese and processed milk products are being based on the cost of production which is the subject of investigation and report each year by the Joint Dairying Industry Advisory Committee.

As a result of the committee’s most recent findings, the Commonwealth decided that returns to farmers should be guaranteed at 2s. l!.27d. per lb. of commercial butter during 1950-51. This represents an increase of 1.77d. per Jb. over the return guaranteed for last year. It was also found that butter factory costs had risen by 0.18d. per lb. compared with the previous year.

The home-consumption prices of butter, cheese and processed milk products are being held at a level lower than is necessary to give the fanner his guaranteed return, and unless the State Prices Ministers agree to a rise in home-consumption prices, the increases in cost of production which have been established in respect of .1.950-51 will have to be met by subsidy. The lifting of butter rationing also adds to the cost of the subsidy.

In respect of locally consumed butter and cheese, the present rate of subsidy is 10.9d. per lb. commercial butter basis.

The estimated cost of the subsidy on these products during 1950-51 is £11,300,000.

Tea,. - The Government has decided’ to continue the subsidy on tea at an annual ceiling rate not in excess of £7,000,000. This will require payment of subsidy at the approximate rate of 2s. 4½d. per lb.

Woollen Goods for Home Consumption. - Tn order to offset the effect of recent higher auction prices foi wool on the ,price level of woollen products consumed locally, a subsidy will be -paid in respect of such goods produced in Australia for home consumption. An amount of £20,000,000 is being provided in 1950-51 for this .purpose.

Wheat. - In accordance with the Commonwealth’s guarantee to the wheat industry the return to growers, in respect of wheat consumed in Australia from the 1949-50 crop, was increased by 5d. per bushel as from the 1st December, 194.9, to cover a rise in the cost of production. The Government decided to subsidize this increase rather than allow the effect to pass into the price pf basic consumer goods.

The total subsidy in respect of the 1949-50 crop is estimated at £1,250,000. Of this amount £622,000 was paid prior to 30th June last, leaving £628,000 to be provided this financial year.

Imported Goal. - By agreement between the Commonwealth and the States of Victoria and South Australia, the importation of up to 980,000 tons of Indian and South African coal has been arranged on the Commonwealth’s account. Of this quantity, 900,000 tons has been ordered for delivery before the 30th June. 1951, and is in addition to the amounts ordered overseas by the two States on their own behalf. Under the arrangement, coal which would otherwise have been supplied to these two States from New South Wales will be diverted by the Joint Coal Board to basic industries, principally the steel industry in New South Wales. Subsidy will be paid on the coal imported on Commonwealth account so as to bring the landed cost down to that of first-class Newcastle coal. If it is also necessary for these two States to use coal imported on their account to make good deficiencies arising from the diversion of Newcastle coal, such coal will be eligible for a similar subsidy.

It is estimated that the subsidy will cost £3,200.000 in l!).r,0-51.

Prefabricated Houses. - The Commonwealth Government has offered the State governments a subsidy to assist them to meet the additional costs of prefabricated houses imported by State housing authorities.

The subsidy is to bc an amount of up to £300 per house and for a maximum of 10,000 houses, provided the subsidy does not reduce the average cost of all the prefabricated houses imported to less than the cost of traditionally built houses of similar accommodation.

A further condition is that the houses are to be erected primarily in areas producing basic materials, particularly coal and steel, and preference in allocation of the houses is to be given to workers needed for production of basic materials.

The cost of the subsidy in 1950-51 has been estimated at £1,500,000.

Superphosphate. - The Government has announced the withdrawal of the subsidy on superphosphate as from the 1st July, 1950. The provision of the amount of £285,000 is required to cover subsidy payments on deliveries made up to the 30th June last.

Nitrogenous Fertilizer. - The Government has decided that the amount of subsidy to be paid on nitrogenous fertilizer in 1950-51 should noi exceed £500,000. This subsidy is designed to meet the difference between the average cost of nitrogenous fertilizer procured by the nitrogen pool from various sources and the fixed selling price. To keep the subsidy within the limit of £500,000, it was necessary to increase the wholesale price of ammonium sulphate from £20 10s. to £24 10s. as from the 1st July, 1950.

Other Items. - The provision of £25,000 is required to pay outstanding claims in reaped of subsidies which have been discontinued.

Redemptions of War Savings Certificates and Savings Certificates during the year were £3,560,753 l face value). No loans were raised in London during the financial year, but a Victorian loan of £6,055,545 sterling which matured on 1st October, 1949, was paid off on maturity. Funds for the repayment were provided as follows : - The Commonwealth Bank received in exchange for its payment 3) per cent. 1963 securities in Australia of an equivalent amount in Australian currency During 1949-50 the receipts of the National Debt Sinking Fund for redemption purposes were £31,542,000. In addition, a balance of £18,422,000 was carried forward from the previous year, making a total of £49,964,000 available for debt redemption in 1949-50. Of this amount an unused balance of £13,969,000 is being carried forward to the financial year 1950-51 and it is estimated that, with receipts of £33,982,000 in 1950-51, the total amount available for debt redemption purposes in the current financial year will be £47,951,000. {: type="A" start="I"} 0. move - >That the first item in the Estimates under Division No. 1 - The Senate - namely, " Salaries and allowances, £13,900 ", be agreed to. {: #subdebate-30-0-s1 .speaker-A48} ##### Mr CHIFLEY:
Leader of the Opposition · Macquarie -- *by leave* - I ask the Treasurer **(Mr. Fadden)** to have prepared a table setting out a comparison of taxes that will be payable as the result of the introduction of the deduction system compared with those that would be payable under the present rebate system. I should like such information compiled in respect of family units up to a family unit of four persons and also in respect of incomes up to £5,000 per annum. {: .speaker-F4T} ##### Mr Fadden: -- A table setting out that information is being prepared. Progress reported. {: .page-start } page 793 {:#debate-31} ### BUDGET PAPERS The following papers were pre sented : - >The Budget 1950-51 - Papers presented by the Eight Honorable A. W. Fadden, M.P., for the information of honorable members on the occasion of the Budget of 1950-51. {:#subdebate-31-0} #### National Income and Expenditure 1949-50 Ordered to be printed. {: .page-start } page 793 {:#debate-32} ### SUSPENSION OF STANDING ORDERS Motion (by **Mr. Menzies)** agreed to - >That so much of the Standing Orders be suspended as would prevent the introduction of resolutions and bills consequent on the Budget and motions for the first and second-reading of such bills. {: .page-start } page 793 {:#debate-33} ### SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) BILL 1950 Motion (by **Mr. Fadden)** agreed to - >That leave be given to bring in a bill for an act to amend the Sales Tax (Exemptions and Classifications) Act 1935-1949. Bill presented, and read a first time. {:#subdebate-33-0} #### Second Reading {: #subdebate-33-0-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson · CP -- I move - >That the bill be now read a second time. In accordance with assurances given by the Government, a comprehensive review of the sales tax law has been carried out, and due consideration has been given to the many requests that have been made from time to time for exemption from sales tax of numerous classes of goods. It will be appreciated that it would be quite impossible to accede toall those requests, but relief is being given as far as is possible in thepresent circumstances. The new concessions relate chiefly to building materials and foodstuffs. It is a fact, of course, that most goods of those classes are already exempt, but the amendments now proposed will provide further substantial relief in this direction. The new exemptions of building material include builders' hardware such as nails, bolts, screws, door handles, locks and similar fittings of a kind installed by builders as fixtures in houses. The present exemption of specified household electrical fittings is being extended to cover certain classes of electrical fittings, previously excluded because of the extent of their use in buildings other than houses. Bath heaters, sink heaters and similar Water heating equipment of a kind installed as fixtures in houses are also being brought within the scope of the exemptions. Exemption is also being allowed in respect of structural steel in the form of girders, which, although used mostly in industrial and business premises are to some extent used inbuildings which provide residential accommodation such as hostels. The exemption of all these goods will lesson the cost of building, and assist in solving problems of housing and accommodation generally. The extensions of the exemptions of foodstuffs are designed chiefly to eliminate competitive anomalies, and they apply to foods which are closely comparable with other foods already covered by existing exemptions. The foods now being made exempt from tax include certain foods in the form of sandwich spreads, relishes and meat extracts. The restoration of coffee and cocoa to the exemptions schedule is based on the fact that they are sold in competition with tea, a beverage which does not bear sales tax. Strong representations for the exemption of ice are being acceded to, as this commodity serves an important purpose in the preservation of foods and is widely used throughout the community. The exemption of ice is in line with the fact that sales tax is not payable in respect of electricity, gas and kerosene, which are used in refrigerators for the same purpose. There has been much criticism of the fact that tax is payable in respect of tractor-drawn trailers for use in agricultural industry, whilst horse-drawn trailers for use in that industry are exempt. This anomaly is being removed by extending the exemption so as to cover both classes of trailers. Some complaint has been made, and, in my opinion, with good reason, that it is inappropriate that wedding rings should tear the heavy rate of sales tax payable in respect of jewellery in general. Exemption is accordingly being allowed in respect of plain wedding rings. Wedding rings set with gems will continue to bear the same rate as other jewellery. The new exemptions are provided for in clause 4 of the bill, which contains the amendments to the first schedule to the Sales Tax (Exemptions and Classifications) Act. The effect of the amendments will be readily ascertained from the explanatory statement which has been circulated for the information of honorable members. The further exemptions will involve a loss of revenue amounting to approximately £1,000,000 in a full year, or about £640,000 in the current financial year. As 'I indicated in the budget speech, however, this bill is* not confined to the allowance of further exemptions. Close consideration has been given by the Government to the desirability of measures designed to decrease the demand for goods which may be classified as being of a less essential character. Australia is at present handicapped 'by shortages of certain essential goods, whilst other classes of less essential goods are available to the public in large quantities, and sell readily even at high prices. The taxing of these latter goods at higher rates is regarded as clearly justifiable from more than one angle. In the first place, a heavier impost can reasonably be expected to check the demand for such goods, to cause a diversion of labour to employment of greater value to the nation, and to release more materials for goods which are essential to the nation'9 welfare and protection. In the second place, it is fitting that persons who are in a position to spend money on these less essential goods should be required to make a greater contribution to national revenue1 than those who are obliged to confine their spending to necessities. In the light of these considerations, it is not proposed to increase the general rate of sales tax, which at present stands at 8^ per cent., hut it is proposed that certain goods now subject to that rate shall bear a higher rate. The rate of tax on motor cars is to be increased from 8?, per cent, to 10 per cent. The present rate of 8^ per cent, will continue to apply to motor vehicles such as trucks, lorries, utilities, delivery vans and motor buses. The present rate of 8J per cent, will also continue to apply to parts and accessories for motor cars, because these goods are also used as parts or accessories for trucks or utilities. Musical instruments, wireless receiving sets, gramophones and parts and accessories for these goods will be 'subject to tax at the rate of 25 per cent., which was the rate that was previously applied to them during the war period. The rate of tax is being increased to 33-J per cent, in respect of jewellery, imitation jewellery, fancy goods, watches and clocks other than alarm clocks, plated ware, and crystal and cut-glass ware. This rate is also being applied to. handbags, travelling bags, and other classes of bags and baskets, as well as toilet and beauty preparations, cameras, photographs, photographic film and other photographic equipment, and fur garments. Of the goods that are named in this group, jewellery, imitation jewellery, toilet preparations and fur garments have hitherto, been subject to tax at the rate of 25 per cent. The increased rate of tax on cameras and photographic equipment and materials will not affect professional photographers who engage in the production of photographs for sale, and who pay tax on the finished photographs. These per- ' sons, in common with other manufacturers, will obtain their raw materials and aids to manufacture in the form of equipment free of sales tax.. They will pay tax at the higher rate on their finished photographs. Recently, vendors of cosmetics and of other toilet preparations have complained of difficulties arising from the fact that whilst the law required the payment of tax at the former maximum rate of 25 per cent. in respect of these toilet preparations, there was no similar requirement in respect of the containers in which these goods are sold. The rate of tax on such containers was81/3 per cent. Some of these vendors adopted the practice of selling the goods and the containers for separately specified prices and calculating tax at the rate of 25 per cent. on the charge for the toilet preparations and at 81/3 per cent. on the charge for the containers. This splitting of prices and dual calculation of tax was soon found to cause considerable practical difficulties, particularly in view of staff shortages, and the Government was strongly pressed to relieve the position by causing the goods and the containers to be taxed at the same rate. This is being done in thebill. It is provided that the new maximum rate of 331/3 per cent. will apply not only to toilet preparations, but also to containers in which they are sold. The goods that are affected by the increases of rates are specified in the amendments relating to the second, third and fourth schedules to the Sales Tax (Exemptions and Classifications) Act. Goods that are covered toy items in these schedules will be subject to tax at the rates of 10 per cent., 25 per cent. and 331/3 per cent., respectively. Details of the goods affected are set out in the explanatory statement which has been circulated. It is estimated that those increases will bring in approximately £10,000,000 additional revenue in a full year, or about £7,500,000 for the balance of the current financial year. In accordance with the usual practice, it is pro vided in the bill that the amendments shall commence to operate on and from to-morrow, the 13th October. I commend the bill to honorable members as a measure that will be a material factor in the fight against inflation, and also because of its beneficial effects in the removal of anomalies. Debate (on motion by **Dr. Evatt)** adjourned. SALES TAX BILLS (Nos. 1 to 9) 1950. In *Committee of Ways and Means:* {: #subdebate-33-0-s1 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson · CP .- I move- (1.) That, on and after the thirteenth day of October, One thousand nine hundred and fifty, in lieu of the sales tax imposed by the Sales Tax Act (No. 1) 1930-1949, the Sales Tax Act (No. 2) 1930-1949, the Sales Tax Act (No. 3) 1930-1949, the Sales Tax Act (No. 4) 1930- 1949. the Sales Tax Act (No. 5) 1930-1949, the Sales Tax Act (No. 6) 1930-1949, the Sales Tax Act (No.7) 1930-1949, the Sales Tax Act (No. 8) 1930-1949 and the Sales Tax Act (No. 9) 1930-1949, sales tax be imposed at the following rates,but otherwise in accordance with the provisions of those acts: - {: type="a" start="a"} 0. in respect of goods covered by the Second Schedule to the Sales Tax (Exemptions and Classifications) Act - 10 per centum; {: type="a" start="b"} 0. in respect of goods covered by the Third Schedule to the Sales Tax (Exemptions and Classifications) Act - 25 per centum; 1. in respect of goods covered by the Fourth Schedule to the Sales Tax (Exemptions and Classifications) Act - 331/3 per centum; and 2. *d* ) in respect of goods not covered by the Second, Third or Fourth Schedule to the Sales Tax (Exemptions and Classifications) Act and on the sale value of which it is not provided by that Act that sales tax shall not be payable -81/3 per centum. (2.) That, for the purposes of the foregoing resolution, "the Sales Tax (Exemptions and Classifications) Act" mean the Sales Tax (Exemptions and Classifications) Act 1935- 1949 as proposed to be amended by the Sales Tax (Exemptions and Classifications) Bill 1950. The purpose of this proposed resolution is to declare the new rates of sales tax payable, on and after the 13th October, 1950, in respect of goods of the various classifications specified in the Sales Tax (Exemptions and Classifications) Bill that I have just introduced. That bill contains provisions for a new second schedule and a new fourth schedule to the Sales Tax (Exemptions and Classifications) Act, and the bills to be introduced later to give effect to the resolution will impose tax at the rate of 10 per ment. and 331/3 per cent. respectively in respect of goods covered by the provisions of those schedules. The rate of 25 per cent. will apply to goods covered by the third schedule as amended. The general rate of 81/3 per cent., which applies to goods not specified in any of the schedules, remains unchanged. As I have already indicated, the effect of the resolution and associated bills upon the various classes of goods in question, is clearly set out in the explanatory statement which has been circulated among honorable members. Progress reported. {: .page-start } page 796 {:#debate-34} ### WOOL SALES DEDUCTION (ADMINISTRATION) BILL 1950 *In Committee of Ways and Means:* {: #debate-34-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson · CP [9.431-I move- {: type="1" start="1"} 0. That a producer be liable to pay to the Commonwealth an amount equal to one-fifth of the sale value of wool produced by him and, on or after the twenty-eighth day of August, One thousand nine hundred and fifty, sold Or otherwise disposed of by him otherwise than for delivery out of Australia. 1. That a producer be liable to pay to the Commonwealth an amount equal to one-fifth of the appraised value of wool produced by him and, on or after the twenty-eighth day of August, One thousand nine hundred and fifty, exported by him. 2. That the foregoing resolutions do not apply in relation to wool produced in the Northern Territory of Australia. 3. That expressions used in these resolutions have the same meanings as they have in the Wool Sales Deduction (Administration) Bill 1950. 4. That the acts passed to give effect to these resolutions be expressed to continue in force until a date to be fixed by Proclamation but not *in* any event after the Wool Sales Deduction (Administration) Act 1950 ceases to be in force. As I said when introducing the budget, the Government is preparing an organized and balanced plan to bring the various inflationary forces under control. A close examination is being made of the measures necessary to draw off some part of abnormal profits. The high prices that are now being obtained for wool are well known to honorable members. The Government rejoices with the wool industry in the present prosperity, but is concerned about the effect that the greatly increased spending power will have on the national economy. The Government believes that unless some positive and immediate action is taken to reduce the effect of this increased spending power a further impetus will be given to the inflationary spiral. The proposed resolutions that I have submitted are a part of the overall plan of the Government for controlling the inflationary forces. Honorable members may have heard it suggested that the Government intends to impose some additional tax on those persons who are benefiting from the high price of wool. The Government's proposals, however, do not impose any additional tax on that class of taxpayer. The Government considers that the present situation can be adequately met by withholding from circulation a proportion of the moneys that are now being obtained from the sale of wool. Accordingly, these proposed resolutions, provide that 20 per cent. of the price obtained for wool shall be paid to the Commissioner of Taxation and be held by him until income tax becomes payable on the wool proceeds. The first proposed resolution requires that 20 per cent. of the sale value of wool shall be paid to the Commissioner in any case where the wool is sold. The second proposed resolution requires that 20 per cent. of the appraised value of the wool shall be paid to the Commissioner in any case where it is exported. It is proposed that this plan shall apply to all wool sold or exported on or after the 28th August, 1950, that being the date of commencement of the current season's wool sales. At a later stage, a bill will be introduced to provide the machinery and procedure for the collection of the amounts which by these proposed resolutions will be payable to the Commissioner. It is proposed that wool-selling brokers shall deduct from the sale price an amount equal to 20 per cent. of that price, and pay the amount deducted to the Commissioner, instead of to the person on whose behalf the wool is sold. A person who purchases wool, other than through a wool-selling broker, will also be required to pay 20 per cent. of the sale price to the Commissioner, instead of to the person from whom it was purchased. In the case of a person who exports wool, the payment will be made by him to the Commissioner and will, of course, be based upon an appraised value. Those persons who have sold wool since the 28th August last, and have already received the proceeds from the sale, will be required to make a direct payment to the Commissioner. Provision will be made in the machinery bill to ensure that a payment will be made only once in respect of any wool. Details of the procedure for the collection of amounts that become payable to the Commissioner, as a result of these proposed resolutions, will be explained when the machinery bill is introduced. However, it may be appropriate for me to explain, at this stage, that the procedure will provide for wool-selling brokers to issue wool deduction certificates to the persons on whose behalf they sell wool. In a similar manner, a person who buys wool will issue a deduction certificate to the person from whom he purchases the wool. When a person to whom a wool deduction certificate is issued furnishes his income tax return for the year in which the wool was sold, he will forward the certificate to the Commissioner with the return. The Commissioner will give him credit, against the tax assessed, for the value of the certificate and will refund to him any excess. The proposed resolutions provide that wool produced in the Northern Territory will be exempt. This is proposed because primary producers who are residents of the Northern Territory are not required to pay income tax on income derived from primary production. I want to make it perfectly clear to honorable members that the Government's proposals do not impose any additional tax burden on the wool industry. They merely require payment of an amount at the time of the transaction, which will be applied later in payment of any income tax that may arise from that transaction. This' principle has been followed for the last nine years in the case of salary and wage earners. It has operated very successfully over a field of 2,500,000 tax payers. The proposals represent an anti-inflationary device necessitated by existing economic circumstances. I commend these proposed resolutions to honorable members. Progress reported. {: .page-start } page 797 {:#debate-35} ### SUPPLY BILL (No. 2) 1950-51 *In Committee of Supply:* Motion (by **Mr. Fadden)** agreed to - ^ That there be granted to His Majesty for or towards defraying the service of the year 1950-51 a sum not exceeding £61,189,000. Resolution reported and adopted. Resolution of Ways and Means, founded! on Resolution of Supply, reported and adopted. *Ordered -* >That **Mr. Fadden** and **Mr. Anthony** do prepare and bring in a bill to carry out theforegoing resolution. Bill presented by **Mr. Fadden,** and1 read a first time. {:#subdebate-35-0} #### Second Reading {: #subdebate-35-0-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson. · CP .- I move- >That the bill be now read a second time. The Supply Act (No. 1) 1950-51 madeprovision to meet requirements for thefirst four mouths of the financial year 1950-51. The. purpose of this bill is toobtain' Supply for a further period of two months to carry on the necessary normal services of the Government, other than capital services. The amount to be appropriated is £61,189,000, and details may be summarized under the following: heads : - In the past it has been the practice to base the provision in a Supply Bill on the appropriations of the previous year. Under present conditions, however, it has been found impracticable to limit the amounts to one-sixth of the expenditure for the ordinary services of last year. Salaries have been progressively increasing with the rise of the cost of living, and the recent award of the Public Service Arbitrator, which dates back to December last, has required the provision of a substantial additional amount. The increased cost of materials has bad a considerable impact on the amount required. The amounts in the bill are, therefore, based on the current needs of departments, but there is no provision for the increase of the basic wage that was announced to-day. The amount of £27,325,000 for defence services provides for expenditure on the post-war defence plan and, the additional commitments which the Commonwealth has undertaken in respect of Malaya and Korea. The amount of £597,000 provided for "War (1939-45) Services covers expenditure on repatriation and rehabilitation and other charges arising out of World War II. Except in relation to commitments in Malaya and Korea, no amounts are included for new services. Debate (on motion by **Dr. Evatt)** adjourned. {: .page-start } page 798 {:#debate-36} ### SUPPLY (WORKS AND SERVICES) BILL (No 2) 1950-51 *In Committee of Supply:* Motion (by **Mr. Fadden)** agreed to - >That there he granted to His Majesty for or towards defraying the service of the year 1950-51, for the purposes of Additions, New Works and Other Services involving Capital Expenditure a gum not exceeding £18,592,000. Resolution reported and adopted. Resolution of Ways and Means, founded on Resolution of Supply, reported and adopted. *Ordered -* >That **Mr. Fadden** and **Mr. Beale** do prepare and bring in a bill to carry out the foregoing resolution. Bill presented by **Mr. Fadden,** and read a first time. {:#subdebate-36-0} #### Second Reading {: #subdebate-36-0-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPhersonl · CP -- I move- >That the bill be now read a second time. This bill provides for a further appropriation of £18,592,000 to enable Commonwealth works in progress at the 30th June, 1950, to be continued, pending the passing of the budget by the Parliament. Amongst the major items for which further appropriation is sought are £10,000,000 for the Postal Department, £2,300,000 for immigration and £1,450,000 for civil aviation. The Government has adopted a policy of comprehensive long-range planning for The Government has adopted a policy of comprehensive long-range planning for capital works, covering from periods of three to five years, in the defence services and in departments such as Works and Housing, Postmaster-General and Civil Aviation. To enable these programmes to be continued successfully, it is essential that funds be available without interruption for the purchase of materials in advance, both in Australia and overseas, to ensure continuous employment on the many projects. Thebill provides therefore for a further two months' expenditure on works based approximately on the expenditure programme of £69,000,000 included in the capital works estimates 1950-51, which are now being considered by the Parliament. Together with the amounts provided in Supply (Works and Services) Act (No. 1) 1950-5,1, this bill makes provision for the estimated requirements for six months of the current financial year. I might mention here, as I did in my budget speech, that the Government has given the closest scrutiny to all works programmes and has made heavy reductions on original departmental proposals to ensure that there shall be no undue competition for scarce labour and materials. In accordance with the usual practice in submitting a Supply Bill, no provision has been made for any new service. Debate (on motion by **Mr. Chifley)** adjourned. {: .page-start } page 798 {:#debate-37} ### LOAN (HOUSING) BILL 1950 Message recommending appropriation reported. *In committee* (Consideration of Governor-General's message) : Motion (by **Mr. Casey)** agreed to - >That it is expedient that an appropriation of moneys be made for the purposes of a bill for an act to authorize the raising of moneys to be advanced to the States for the purposes of housing. Resolution reported and adopted. *Ordered -* >That **Mr. Casey** and **Sir Earle** Page do prepare and bring in a bill to carry out the foregoing resolution. Bill presented by **Mr. Casey,** and read a first time. {: .page-start } page 799 {:#debate-38} ### WAR PENSIONS APPROPRIATION BILL 1950 Message recommending appropriation reported. *In committee* (Consideration of Governor-General's message) : Motion (by **Mr. Fadden)** agreed to - >That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to grant and apply out of the Consolidated Revenue Fund a sum for war pensions. Resolution reported and adopted. *Ordered -* >That **Mr. fadden** and **Sir Earle** Page do prepare and bring in a bill to carry out the foregoing resolution. Bill presented by **Mr. Fadden,** and read a first time. {:#subdebate-38-0} #### Second Reading {: #subdebate-38-0-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson · CP . - I move - >That the bill be now read a second time. The purpose of thisbill is to provide £28,000,000 out of the Consolidated Revenue Fund for the payment of war pensions. The measure is similar to that submitted to the Parliament from time to time for the purpose of appropriating from revenue an amount for payment into a trust account to enable pensions to be paid in accordance with such rates as are approved by the Parliament. Expenditure on war pensions is showing a continuous increase, as the following table indicates: - The amount of £28,000,000 now required will cover approximately a year's expenditure. This measure merely authorizes the provision of funds for the trust account from which war pensions are paid. It has no relation whatsoever to the rates or conditions under which war pensions are paid. The Government's intentions in this regard have been outlined in my budget speech, and honorable members will have full opportunity of debating the proposals when the enabling legislation is introduced. In view of the fact that the present appropriation is now exhausted, an early passage of the bill is necessary so that the payment of pensions may continue without interruption at the rates at present approved by the Parliament. Debate (on motion by **Mr. Chifley)** adjourned. {: .page-start } page 799 {:#debate-39} ### STATES GRANTS BILL 1950 Message recommending appropriation reported. *In committee* (Consideration of GovernorGeneral's message) : Motion (by **Mr. Fadden)** agreed to - >That it is expedient that an appropriation of revenue be made for the purposes of abill for an act to grant and apply out of the Con solidated Revenue Fund sums for the purposes of financial assistance to the States of South Australia, Western Australia and Tasmania. Resolution reported and adopted. *Ordered -* >That **Mr. Fadden** and **Mr. Casey** do prepare and bring in a bill to carry out the foregoing resolution. Bill presented by **Mr. Fadden,** and read a first time. {:#subdebate-39-0} #### Second Reading {: #subdebate-39-0-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson · CP .- I move- >That the bill be now read a second time. The purpose of this bill is to provide for the payment during the current financial year of special grants aggregating £12,175,000 to the States of South Australia, Western Australia and Tasmania. The payment of these grants has been recommended by the Commonwealth Grants Commission in its seventeenth report which has already been tabled in the Parliament. As in previous years, the commission has adopted the principle of financial needs in arriving at the grants recommended. In interpreting this general principle, it has compared the financial positions and practices of the claimant and the non-claimant or standard States. The audited results of the States' budgets on which the commission bases its detailed calculations are not available until some time after the close of each financial year. There is, therefore, a time-lag of two years between the year in which the grants are assessed and the year in which the grants are paid. In order to meet this time-lag difficulty, the grants recommended by the commission in its last two reports have consisted of two parts. The commission's first step is to calculate the " assessed grants " for the latest year in respect of which audited figures are available, which is, in the present case, 194S-49. In arriving at the " assessed grants " for 194S-49, the commission calculated the amounts which would have been required to give the claimant States balanced budgets in that year and then adjusted those amounts to take account of differences between the claimant and the non-claimant States in standards of social services expenditure and in the rates of taxation and the charges of State business undertakings. The first part of the grants now recommended by the commission is the difference between the grants so assessed for 1948-49 and the grants actually paid in that year. This part is an adjustment to correct overpayment or underpayment in the grants recommended and paid in 1948-49. The second part of the grants represents the commission's estimate, calculated on a conservative basis, of what the assessed grants for 1950-51 may prove to be when the audited results for this year become available. It is treated by the commission as an advance payment which will be adjusted two years hence when the assessed grants are calculated. As I have mentioned, the special grant3 recommended for payment this year total 12,175,000. Of this amount the first part of the grants totals £1,755,000, whilst the advance payments to meet the indis pensable financial needs of the States in 1950-51 total £10,420,000. The first part of the grants recommended for payment to South Australia and "Western Australia amounts to £762,000- and £1,089,000 respectively, representing the amounts by which the grants now assessed for 1948-49 exceed the grants actually paid in that year. The grant actually paid to Tasmania in 1948-49 exceeded the grant now assessed for 1948-49 by £96,000, and the grant for 1950-51 has therefore been adjusted accordingly by the commission. The second part of the grant, which is designed to meet the indispensable financial needs of the States in 1950-51, is in each case higher than grants assessed for 1948-49. This reflects the deterioration which would occur in the finances of each State in the absence of increased special grants. The reasons for this deterioration aro set out fully in the commission's report. The main single item accounting for the deterioration is the increase of social services expenditure. In arriving at the grants, the commission has taken account of the shares of the claimant States, amounting to £2,539,000, in the prospective increase of the tax reimbursement grants this year. As the special grants now proposed involve an increase this year of £1,121,000, the total increase in the payments to the claimant States on account of both the tax grants and the special grants will amount to approximately £3,660,000. Of this amount, South Australia will receive an additional £2,254,000, Western Australia an additional £1,226,000 and Tasmania an additional £180,000. The special grants recommended each year by the commission since its establishment in 1933 have always been adopted by successive governments and the present Government can see no reason why the recommendations contained in the commission's seventeenth report should not be adopted this year. Because of printing difficulties, only a few copies of the commission's report have been received and these are held by the Clerk of the House. I commend the bill to honorable members. Debate (on motion by **Mr. Chifley)** adjourned. {: .page-start } page 801 {:#debate-40} ### STATES GRANTS (ADDITIONAL TAX REIMBURSEMENT) BILL 1950 Message recommending appropriation reported. *In committee* (Consideration of GovernorGeneral's message) : Motion (by **Mr. Fadden)** agreed to - >That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to grant and apply out of the Consolidated Revenue Fund a sum for the purpose of financial assistance to the States. Resolution reported and adopted. *Ordered -* >That **Mr. Fadden** and **Mr. Casey** do prepare and bring in a bill to carry out the foregoing resolution. Bill presented by **Mr. Fadden,** and read a first time. {:#subdebate-40-0} #### Second Reading {: #subdebate-40-0-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson · CP .- I move- >That the bill be now read a second time. The purpose of this bill is to authorize the payment to the States in 1950-51 of an additional tax reimbursement grant of £5,000,000. Under the tax reimbursement formula embodied in the States Grants (Tax Reimbursement) Act 1946-1948, it is estimated that the tax reimbursement grant to the States will amount to £70,393,000 in 1950-51, or £7,856,000 more than was granted last year. As a consequence of this bill, therefore, the total tax reimbursement grants to the States will be increased by £12,856,000 this year. At the conference of Commonwealth and State Ministers, which was held last month, the State Premiers indicated that they were confronted with substantial budget difficulties this year, particularly because of the effects of rising costs on State expenditures. The Premiers therefore suggested that the tax reimbursemnt formula should be amended. The reimbursement formula in question was laid down in the legislation passed in 1946, which provides that the aggregate tax reimbursement grant be varied each year in accordance with a formula which takes account of variations of the State's popu lations and increases of the level of average wages. The formula was amended in 1947 and again in 1948. The general effect of the 1948 amendment was to increase the grant for 1948-49 by £8,740,000, whilst this year the formula will result in the States receiving about £19,000,000 more than they would have received under the 1946 formula. A further indication of the amount by which the grant has been increased in recent years is given by the fact that in the five years since 1946-47 it will have increased from £40,000,000 to just over £70,000,000, an increase of 75 per cent. After considering all the circumstances, including the present and prospective commitments of the Commonwealth, the Premiers were informed that the Commonwealth could not contemplate amending the f ormula, but that it would be prepared, as a special measure this year, to supplement the amount payable under existing legislation by an additional grant of £5,000,000 in 1950-51. At the same time, the Commonwealth suggested that a complete review should be made of the financial relations of the Commonwealth and the States. The Premiers stated their readiness to participate in sucha review, and a special conference of Commonwealth and State Ministers will be convened by the Commonwealth for this purpose. It is laid down in the bill that the grant of £5,000,000 will be distributed among the States in the same proportions as the grant payable under the States Grants (Tax Reimbursement) Act 1946-1948 is distributed in 1950-51. The precise amount which each State will receive this year under the legislation will not be known until the Commonwealth Statistician has completed the calculations which he is required by law to complete. Preliminary estimates furnished by the Statistician, however, indicate that the share of each State of the additional grant of £5,000,000 will be approximately as follows: - I commend the bill to honorable members. Debate (on motion by **Mr. Chifley)** adjourned. {: .page-start } page 802 {:#debate-41} ### LOAN BILL 1950 Message recommending appropriation reported. *In committee* (Consideration of GovernorGeneral's message) : Motion (by **Mr. Fadden)** agreed to - >That it is expedient that an appropriation of moneys be made for the purposes of a bill for an act to authorize the raising and expending of a certain sum of money. Resolution reported and adopted. *Ordered -* >That **Mr. Fadden** and **Mr. Casey** do prepare and bring in a bill to carry out the foregoing resolution. Bill presented by **Mr. Fadden,** and read a first time. {:#subdebate-41-0} #### Second Reading {: #subdebate-41-0-s0 .speaker-F4T} ##### Mr FADDEN:
Treasurer · McPherson · CP .- I move- >That thebill be now read a second time. The budget proposals for 1950-51 provide for an expenditure from the Loan Fund of £25,000,000 for war service homes and £4,000,000 for war service land settlement. The present measure seeks parliamentary authority for the raising and expending of these moneys. The amount of £25,000,000 for war service homes is required to meet expenditure under the War Service Homes Act to assist ex-servicemen to obtain homes. Under that act the War Service Homes Division purchases and develops estates for housing, finances both individual and group housing projects, and makes advances for the purchase of existing properties, or the discharge of existing mortgages. In the financial year 1949-50, the expenditure on war service homes amounted to £16,000,000 from Consolidated Revenue and Trust Fund balances. The expenditure now proposed thus represents an increase of 55 per cent. on that of the previous year. It is expected that about 15,000 houses will be made available to ex-service personnel in this financial year. The amount of £4,000,000 for war service land settlement is to be paid to the States as financial assistance for the settlement of ex-servicemen on the land. This expenditure is designed to assist the States of South Australia, Western Australia and Tasmania in acquiring, developing and improving land for subdivision into holdings that will be allotted to ex-servicemen settlers, and in providing credit facilities for the settlers. In the other States, of course, the provision of capita] moneys for these purposes is the responsibility of the State Government concerned. Financial assistance to all the States for other expenditure on war service land settlement, such as living allowances for settlers, the writing down of the value of holdings, &c, amounting to £1,180,000 in 1950-51, will be paid by the Commonwealth from the Consolidated Revenue Fund. Debate (on motion by **Mr. Chifley)** adjourned. {: .page-start } page 802 {:#debate-42} ### ADJOURNMENT {:#subdebate-42-0} #### Miners Pensions - Kashmir Dispute - 1939-45 War - Department of Social Services - Canberra Community Hospital Motion (by **Mr. Menzies)** proposed - >That the House do now adjourn. {: #subdebate-42-0-s0 .speaker-JSW} ##### Mr BRYSON:
Wills .- I wish to place before the House a matter on which I ask for the assistance of either the Minister for Health **(Sir Earle Page)** or the Minister for Social Services **(Senator Spooner).** I am aware that it is not a responsibility of the Federal Government, but because of the peculiar circumstances of the case I bring it to the attention of the appropriate Minister, in the hope that some action may be taken in regard to it. The case to which I refer concerns a man who suffers from miner's phthisis. He made an application originally in Western Australia for the payment of compensation because he had contracted that disease but was informed that as he had not applied within the prescribed period he was not eligible to receive any compensation payment from that State. He then applied to the Victorian Government for payment of compensation and his claim was again rejected. I shall quote a portion of a letter from the Victorian Treasury that will explain the case to some degree. Th that letter the Victorian Director of Finance made the following statement: - >Tl,e facts of the case are that the applicant mined in Victoria during tcn years from 1899 to 1909 followed by 17 years in Western Australia. He left the Western Australian mine in 192(1 because he was suffering from minor's phthisis. Bis subsequent mining experience was for odd very short periods only, in Victoria, Tasmania and again in Western Australia. In view of the foregoing the Treasurer feels it would bc very difficult to say that the applicant's condition is due to mining in Victoria. In the circumstances he regrets that he cannot vary the decision given hy his predecessor. The actual position is that this man worked in the mines of Victoria and Western Australia for quite long periods. It is almost certain that his work in Victoria was partly responsible for his having contracted dust disease, whilst his work in Western Australia was also partly responsible. Because of his activities in both States he is now a chronic sufferer from miner's phthisis. Until now both State Governments have disclaimed responsibility. I appeal to-night to either the Minister for Health or the Minister for Social .Services, whichever is the appropriate Minister to handle the case, to negotiate with those State governments with a view to ascertaining whether a scheme can be evolved whereby this man and any other man who is suffering under similar circumstances, can receive benefits from one State or the other or partial benefits from both States. {: .speaker-C7E} ##### Sir Earle Page: -- Is he an inmate of a home? {: .speaker-JSW} ##### Mr BRYSON: -- No, he is able to walk about, but is not able, to engage in any ordinary work, and he is permanently receiving treatment. Because of his disease, his living expenses, naturally, are much higher than they would otherwise be. . {: .speaker-C7E} ##### Sir E ak ls Page: -- Is he receiving any pension ? {: .speaker-JSW} ##### Mr BRYSON: -- Not as a result of the disease. As I see it, this is not a Commonwealth matter, but where there is a difference of opinion on the subject and where work' in two .States is partly responsible for his condition, I consider that the appropriate Minister might see fit to discuss the matter with the Ministers of Health of the two States concerned. {: .speaker-C7E} ##### Sir Earle Page: -- Will the honorable gentleman supply -to me later the man's name ? {: .speaker-JSW} ##### Mr BRYSON: -- I shall do so now. His name is **Mr. Arthur** Gregory, and his address is 10 'Belgrave-street, East Coburg, Victoria. Perhaps the Minister will be able to do something to gain for this man the assistance to which in my opinion he is entitled. {: #subdebate-42-0-s1 .speaker-KEE} ##### Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP -- Recently I had an opportunity to peruse the full report of **Sir Owen** Dixon to the United Nations on the Kashmir dispute. That document contains information which is of such vital importance to every Australian that I ask the Minister for Health **(Sir Earle Page)** to have a copy of it placed in the hands of every honorable member. I understand that it is not a confidential report. In view of the recent proposals that have been made for mediation in Korea and in view of what happened in Hyderabad and the situation that is now evident in Kashmir I believe it to be the duty of every honorable member to acquaint himself with the facts as reported by the mediator who was appointed by the United Nations. {: #subdebate-42-0-s2 .speaker-DTN} ##### Dr EVATT:
Barton .- I learned this evening that, during the course of a debate this afternoon, the honorable member for Gwydir **(Mr. Treloar)** referred to the conduct of the war against Japan by the Curtin Government and' stated that he had been informed that at one stage of the war, before the battle of the Coral Sea- {: #subdebate-42-0-s3 .speaker-10000} ##### Mr DEPUTY SPEAKER: -- I presume that the right honorable gentleman is not going to engage in a debate on the matter ? {: .speaker-DTN} ##### Dr EVATT: -- No, **Mr. Deputy Speaker.** I intend to deal with the matter as shortly as possible. The honorable member for Gwydir stated that two members of the Cabinet had been in favour of the capitulation of Australia. That statement is completely untrue. Throughout the course of the war against J apan such a suggestion was never made while the Curtin and Chifley governments were in power. I do not suggest that the honorable member for Gwydir originated the statement, but whoever did so made an allegation that is so untrue and foul having regard to the efforts of the Curtin Government, that it should be denied as quickly as possible by some one who. knows the record of that Government. Everything that took place in the War Cabinet and in the Advisory War Council has been recorded by the permanent secretary of both bodies, **Sir Frederick** Shedden. The Curtin Government believed that Japan should surrender unconditionally. I do not suppose that anybody really believes the honorable member's statement to be founded on truth. I do not think the honorable member for Gwydir could himself believe it - to be true for it is absolutely untrue. The general conduct and planning of the war was not only in the hands of the War Cabinet. Its decisions came before the Advisory Wai- Council on which the Opposition was represented. Honorable members who served on the Advisory War Council will confirm what I have said. I consider that it is scandalous that such a statement should be made. It should be retracted or the Government should appoint some authority to investigate it in order that its falsity may be established. {: #subdebate-42-0-s4 .speaker-6V4} ##### Mr DALY:
Grayndler .- I wish to reply 'to certain statements that were made to-day by the Minister for Social Services **(Senator Spooner).** {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- This House is not interested in what has happened in another place. {: .speaker-6V4} ##### Mr DALY: -- I am commenting on a report containing information that has been given to me which deals with a statement made :by the Minister in reference to a newspaper article that appeared in the Sydney *Sun.* In the course of comment on it the Minister alleged that I made a cowardly attack on the officers of the Department of Social Services. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Was the statement made in the Senate? {: .speaker-6V4} ##### Mr DALY: -- The text of the statement has been passed on to me and I make this explanation only because I consider that I have been misrepresented and should be given the opportunity to clarify a comment on myself which is unfair, unjust and untruthful. I crave your indulgence, **Mr. Deputy Speaker,** to clarify the point. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- I can allow the honorable member to proceed only if he obtains leave to make a personal explanation. {: .speaker-6V4} ##### Mr DALY: -- *by leave* - It has been brought to my attention that the Minister for Social Services, in reply to certain questions based on a newspaper report, stated that I had made a cowardly attack on the officers of the Department of Social Services. The newspaper report was not an accurate record of my speech. On reading it I hardly recognized the contents as being those of the speech that I had made. In the course of my speech in this House, I said - >I make no change against the officers of the department, who, in most instances, are courteous, but there must be some doctors employed who are incapable, or who are casehardened and who should have their credentials investigated. I made that charge only against 1 certain doctors who evidently are doing work for the department and who-I am prepared to prove to the Minister are incapable of carrying out their duties. I suggest that the Minister should have referred to the official report of my speech before making an attack on me. I said that I was prepared to give to him the names of three persons whose pensions had been withdrawn, two of which had them restored. Great hardship was caused in those instances. I am also prepared to furnish particulars of three cases in which grave injustice was done because the parties concerned were treated callously and discourteously by the doctors who examined them. I hope that the Minister will investigate my submissions and withdraw the implications that he made against me in another place. {: #subdebate-42-0-s5 .speaker-K4Y} ##### Dr NOTT:
Australian Capital Territory -- I bring to the notice of the House and the Minister for Health **(Sir Earle Page)** a serious position which is affecting a considerable number of my constituents who are unable to obtain admission, in some cases for urgent surgical attention, to the Canberra Community Hospital owing to the grave shortage of accommodation in that institution. I have no complaint to make against the administration of the hospital, nor have I anything but praise for the efforts of the staff, which is working against great odds owing to staff shortages. I know that the hospital board is in possession of plans which, if implemented, would lead to an immediate amelioration of the position; but, at the moment, owing to the extraordinary demand on the accommodation, people are not able to gain admission and many of them are compelled to proceed to Sydney and elsewhere in order to obtain at a greatly increased cost treatment that they should be able to receive in Canberra. I do not propose to mention some of the exceedingly excessive fees that have been charged people who have been compelled to proceed to Sydney in order to obtain treatment that is essential for their welfare. The hospital cannot at present meet the demand and its extension is urgently necessary if it is to give the service which it is anticipated will be required of it. This is not a new problem. We do not expect the Minister for Health to produce the necessary accommodation overnight simply by waving a magic wand, but J do hope that the matter will receive urgent consideration, and that it' will be given immediate priority so that the hospital can be developed to meet the expanding needs of the Australian Capital Territory. I have discussed this matter with the Minister for Health, and I know that he is sympathetic, but, at this stage, something more than sympathy is required. The problem is rapidly becoming acute. Many people are being seriously inconvenienced, and are incurring medical expenses out of Canberra which, in some instances, are out of all proportion to the services that they are receiving. I beg of the Minister that he take this matter into consideration immediately and leave no avenue unexplored in an endeavour to provide increased hospital accommodation for urgent cases. Even to-day a patient who was to have been admitted had to be refused admission because more urgent cases were awaiting accommodation. The position is entirely unsatis factory. Even an emergency plan would go some distance towards overcoming the shortage that exists. The inadequacy of the nursing staff is another consideration, and I do not propose to touch upon it to-night. I shall have an opportunity to deal with that matter at a later stage. However, I am most concerned for the welfare of people who, owing to the shortage of accommodation, are unable to obtain treatment at the Canberra Community Hospital, and I trust that the matter will be regarded as urgent. {: #subdebate-42-0-s6 .speaker-JWU} ##### Mr FRASER:
Monaro · Eden -- The honorable member for the Australian Capital Territory **(Dr. Nott)** speaks with close knowledge when he describes affairs at the Canberra Community Hospital because, until comparatively recently, he was the executive head of that hospital and saw, during his period of administration, the growing problem that he now regards as being of great urgency. I know of the honorable member's keen interest in the affairs of the hospital, and I appreciate that his remarks to-night have been made in the most helpful spirit. I must say, in fairness to the Minister for Health **(Sir Earle Page)** that since I, as chairman of the Hospital Board, have had dealings with him, he has shown great readiness to handle all matters affecting the hospital as expeditiously as possible. It is quite true that there is pressure on the accommodation available at the hospital at present. That, of course, is a problem that is common to public hospitals all over Australia. It is quite true also that the shortage of beds has not suddenly arisen in recent months. The accommodation problem will be partly met by the completion of the obstetric block now under construction. I was very disappointed that it was not found possible to secure for the hospital a portion of the old building which, instead, has been allocated to the National University, but I must pay a tribute to the Minister for his action in obtaining the highest priority for the construction of much needed new accommodation. * With the assistance of departmental officers, plans have been prepared, and the Minister has agreed to meet representatives of the Hospital Board one night next week to examine those plans. I am hopeful that, in view of Cabinet's decision to give top priority to this work, it will soon be undertaken., I appreciate the action of the honorable member for the Australian Capital Territory in making his plea to the Minister for sympathetic consideration of our requests. I am confident that the Minister will continue to give sympathetic consideration to the affairs of the hospital. Management of the hospital is in the hands of a board elected by the citizens of the Australian Capital Territory at a compulsory poll. It represents all shades of political opinion, yet it works as a team in the interests of the hospital which is by far the largest under the control of the Commonwealth. All our requests have had a very fair reception not only from the present Minister for Health, but also from his predecessor. Whilst I shall be quite prepared to criticize the Minister if at any time he fails to continue his present sympathetic attitude towardsus, I am confident that we shall obtain from him in the future decisions that will facilitate the expansion of the hospitalin accordance with the rapidly growing needs of the Australian Capital Territory and the adjoining areas of the Eden-Monaro electorate which the hospital serves. {: #subdebate-42-0-s7 .speaker-C7E} ##### Sir EARLE PAGE:
Minister for Health · Cowper · CP .- As the honorable member for Eden-Monaro **(Mr. Fraser)** and the honorable member for the Australian Capita] Territory **(Dr. Nott)** know, I have taken a personal interest in the affairs of the Canberra Community Hospital since I have been Minister for Health. In fact, I have believed it to be my special prerogative to look after the Canberra Community Hospital, which, as the honorable member for Eden-Monaro has said, is the largest under the complete control of the Commonwealth. The shortage of beds is not new. It existed when I assumed office, but everything possible is being done to alleviate the situation. When it was found impossible to obtain a part of the old hospital building, Cabinet was good enough to give the highest priority to the erection of an annex to house aged and chronically ill patients, thereby making beds in the hospital itself available for more acute cases. Plans for the new building are progressing favorably and, as the honorable member for Eden-Monaro has stated, I shall discuss them with the hospital authorities next week. I am sure that the Minister for Works and Housing **(Mr. Casey)** will give all possible assistance to the project. Again I assure the honorable members who have raised this matter that the Government is doing everything possible to meet the situation because it wishes to show the rest of Australia the way to deal with the problem of old and chronically ill patients. {: #subdebate-42-0-s8 .speaker-JWE} ##### Mr CASEY:
Minister for National Development and Minister for Works and Housing · La Trobe · LP -- I assure honorable members who have spoken in the adjournment debate that the matters raised by them will be brought to the notice of the appropriate Ministers. Question resolved in the affirmative. {: .page-start } page 806 {:#debate-43} ### PAPERS The following papers were presented : - Commonwealth Public Service Act - Appointments - Department - Repatriation - R. H. Brent. Treasury - C. A. Gordon. Trade and Customs - A. E. A. Weaver. Dairy Produce Export Control Act - Twenty-fifth Annual Report of the Australian Dairy Produce Board, for year 1949-50, together with Statement by Minister regarding the operation of the act. House adjourned at 10.49 p.m. {: .page-start } page 806 {:#debate-44} ### ANSWERS TO QUESTIONS *The following answers to questions were circulated: -* {:#subdebate-44-0} #### Cockatoo Island Dockyard {: #subdebate-44-0-s0 .speaker-K58} ##### Mr O'Connor:
MARTIN, NEW SOUTH WALES r asked the Minister for the Navy, *upon notice -* {: type="1" start="1"} 0. Is Cockatoo Island Dockyard still working under the war-time agreement? 1. Has any alteration been made to the agreement; if so, what is the nature of the change ? 2. What percentage of profits goes to the Commonwealth ? 3. What was the amount of profit made for each of the years ended February, 1947, 1948, 1949 and 1950? 4. What is the relationship of the Naval Board to the administration of the dockyard! {: type="a" start="i"} 0. What difference exists between the status of employees of the dockyard and those of Garden Island, as far as the Commonwealth is concerned, in relation to awards and conditions i {: #subdebate-44-0-s1 .speaker-JWT} ##### Mr Francis:
LP s. - The information is being obtained and I propose to let the honorable member have the reply as soon' as possible. Rich. {: #subdebate-44-0-s2 .speaker-JLZ} ##### Mr Anthony:
CP y. - On the 28th Septem ber. the honorable member for Newcastle **(Mr. Watkins)** asked a question about rice. The Government has decided that distribution of rice to the public in Australia is to bc resumed. Millers are now making arrangements to supply it through the usual channels. Offers to supply rice from outside Australia have been reported at various times over the last few. months. Wheat. {: #subdebate-44-0-s3 .speaker-JLZ} ##### Mr Anthony:
CP y. - On the 28th September the honorable member for Hoddle **(Mr. Cremean)** asked a, series of questions a'bout the chairman of the Australian Wheat Board. I now inform the honorable member as follows : - {: type="a" start="a"} 0. **Mr. J.** S. Teasdale was appointed Chairman of the Australian Wheat Board on the 7 th August, with a salary of £3,000 per annum. A disability allowance of £1,000 per annum is also provided to cover the transfer of bis domicile to Melbourne. 1. The conditions do not include a living away from home allowance, but do include the disability allowance shown above. The remuneration was fixed in pursuance of the provisions of trie Wheat Industry Stabilization Act. 2. As the relevant circumstances are known the need for any investigation does' not arise. (<2) A living away from home allowance was not provided. Regular payment is being made in respect of the disability allowance. Shipping. {: #subdebate-44-0-s4 .speaker-JLZ} ##### Mr Anthony:
CP y. - On the 5th October, the honorable member for Farrer **(Mr. Fairbairn)** asked without notice a question concerning the slow turn round of ships in Australian ports. The Minister for Trade and Customs has now furnished the following information : - * The Department of Trade and Customs is fully mindful of the need to keep a steady flow of trade through the various Australian porta and with this end in view has -done everything possible, consistent with the obligation to safeguard the revenue, to facilitate the clearance of goods through the customs. The department has co-operated with State government authorities and the mercantile community in revising established procedures to speed up the removal of cargo- from wharf areas. In this regard it has adopted a system of checking entries before the arrival of vessels. This is possible in cases where the relevant documents such as bills of lading! invoices, &c. are presented by' the importer or his agent prior to the inward report of the vessel. In Mich cases the related goods are cleared from customs control as soon as payment of duty has been made. A big departure from established customs practice made by the department has been to allow, where appropriate, delivery of good* direct from ships' slings immediately after payment nf duty and primto check of the related entries, subject tn the revenue being protected by means of u security or undertaking to pay any additional duty found to be due. The department also allows importers to take delivery of up to SO per cent, of bulk goods upon payment of duty and before the related entries have been checked. Th remaining 20 per cent, is released as soon as the department is satisfied that the correct duty lias been paid. In common with all employers both governmental and private the department finds difficulty in maintaining sifficient trained staff for its needs. In this connexion considerable overtime is worked and experienced retired officers have been re-engaged. There are many factors contributing to the slow turn round of ships in Australian ports and many people, not having a knowledge of the facts, find it convenient to place the full responsibility on the Department of Trade and Customs.

Cite as: Australia, House of Representatives, Debates, 12 October 1950, viewed 22 October 2017, <http://historichansard.net/hofreps/1950/19501012_reps_19_209/>.

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House of Representatives12 October 1950

QUESTION

BURDEKIN VALLEY DEVELOPMENT

Mr EDMONDS:HERBERT, QUEENSLAND

Mr FADDEN:Treasurer · MCPHERSON, QUEENSLAND · CP

QUESTION

ARUP AND BRUHN PROPRIETARY LIMITED

Mr HAWORTH:ISAACS, VICTORIA

Mr FADDEN:CP

QUESTION

CAPITAL ISSUES

Mr DALY:GRAYNDLER, NEW SOUTH WALES

Mr FADDEN:CP

QUESTION

IRON AND STEEL

Mr WHEELER:MITCHELL, NEW SOUTH WALES

Mr CASEY:Minister for Works and Housing · LP

QUESTION

TEXTILES

Dr EVATT:BARTON, NEW SOUTH WALES

Mr BEALE:Minister for Supply · PARRAMATTA, NEW SOUTH WALES · LP

Mr Ward:

Mr BEALE:

QUESTION

SULPHUR

Mr LESLIE:MOORE, WESTERN AUSTRALIA

Mr BEALE:LP

QUESTION

BRICKS

Mr FRASER:EDEN-MONARO, NEW SOUTH WALES · ALP

Mr CASEY:LP

QUESTION

COMPULSORY ACQUISITION OF PROPERTY

Mr RYAN:FLINDERS, VICTORIA

Mr FRANCIS:Minister for the Army · MORETON, QUEENSLAND · LP

QUESTION

DOLLAR LOAN

Mr CLYDE CAMERON:HINDMARSH, SOUTH AUSTRALIA · ALP

Mr MENZIES:Prime Minister · KOOYONG, VICTORIA · LP

QUESTION

DRIED -FRUITS

Mr TURNBULL:MALLEE, VICTORIA

Mr ANTHONY:Postmaster-General · RICHMOND, NEW SOUTH WALES · CP

QUESTION

PHARMACEUTICAL BENEFITS

Mr DAVIES:CUNNINGHAM, NEW SOUTH WALES

Sir EARLE PAGE:Minister for Health · COWPER, NEW SOUTH WALES · CP

QUESTION

MUNITIONS ESTABLISHMENTS

Mr CRAMER:BENNELONG, NEW SOUTH WALES

Mr BEALE:LP

HOUSING

Mr CLAREY:BENDIGO, VICTORIA

Mr CASEY:LP

QUESTION

BROADCASTING

Mr EGGINS:LYNE, NEW SOUTH WALES

Mr ANTHONY:CP

QUESTION

HEALTH AND MEDICAL SERVICES

Mr FITZGERALD:PHILLIP, NEW SOUTH WALES

Sir EARLE PAGE:CP

QUESTION

CANBERRA

Dr NOTT:

Mr McBRIDE:WAKEFIELD, SOUTH AUSTRALIA · LP; LCL from 1951; LP from 1954

QUESTION

BASIC WAGE

Mr CALWELL:MELBOURNE, VICTORIA

Mr FADDEN:CP

QUESTION

ALUMINIUM

Mr TOWNLEY:DENISON, TASMANIA

Mr BEALE:LP

Mr Treloar:

Mr BEALE:

QUESTION

CIVIL AVIATION

Mr DRAKEFORD:MARIBYRNONG, VICTORIA

Mr WHITE:Minister for Air · BALACLAVA, VICTORIA · LP

House of Representatives
12 October 1950

Mr EDMONDS:
HERBERT, QUEENSLAND

Mr FADDEN:
Treasurer · MCPHERSON, QUEENSLAND · CP

Mr HAWORTH:
ISAACS, VICTORIA

Mr FADDEN:
CP

Mr DALY:
GRAYNDLER, NEW SOUTH WALES

Mr FADDEN:
CP

Mr WHEELER:
MITCHELL, NEW SOUTH WALES

Mr CASEY:
Minister for Works and Housing · LP

Dr EVATT:
BARTON, NEW SOUTH WALES

Mr BEALE:
Minister for Supply · PARRAMATTA, NEW SOUTH WALES · LP

Mr LESLIE:
MOORE, WESTERN AUSTRALIA

Mr BEALE:
LP

Mr FRASER:
EDEN-MONARO, NEW SOUTH WALES · ALP

Mr CASEY:
LP

Mr RYAN:
FLINDERS, VICTORIA

Mr FRANCIS:
Minister for the Army · MORETON, QUEENSLAND · LP

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

Mr TURNBULL:
MALLEE, VICTORIA

Mr ANTHONY:
Postmaster-General · RICHMOND, NEW SOUTH WALES · CP

Mr DAVIES:
CUNNINGHAM, NEW SOUTH WALES

Sir EARLE PAGE:
Minister for Health · COWPER, NEW SOUTH WALES · CP

Mr CRAMER:
BENNELONG, NEW SOUTH WALES

Mr BEALE:
LP

Mr CLAREY:
BENDIGO, VICTORIA

Mr CASEY:
LP

Mr EGGINS:
LYNE, NEW SOUTH WALES

Mr ANTHONY:
CP

Mr FITZGERALD:
PHILLIP, NEW SOUTH WALES

Sir EARLE PAGE:
CP

Mr McBRIDE:
WAKEFIELD, SOUTH AUSTRALIA · LP; LCL from 1951; LP from 1954

Mr CALWELL:
MELBOURNE, VICTORIA

Mr FADDEN:
CP

Mr TOWNLEY:
DENISON, TASMANIA

Mr BEALE:
LP

Mr DRAKEFORD:
MARIBYRNONG, VICTORIA

Mr WHITE:
Minister for Air · BALACLAVA, VICTORIA · LP

Mr JEFF BATE:
MACARTHUR, NEW SOUTH WALES

Mr FADDEN:
CP

Mr CREMEAN:
HODDLE, VICTORIA

Mr MENZIES:
LP

Mr HULME:
PETRIE, QUEENSLAND

Mr HOLT:
Minister for Immigration · HIGGINS, VICTORIA · LP

Mr GEORGE LAWSON:
BRISBANE, QUEENSLAND

Mr MENZIES:
LP

Mr MENZIES:
Prime Minister · Kooyong · LP

Mr FADDEN:
Treasurer · McPherson · CP

Mr HOLT:
Minister for Labour and National Service and Minister for Immigration · Higgins · LP

Mr DEPUTY SPEAKER (Mr Adermann:
FISHER, QUEENSLAND

Mr CALWELL:
Melbourne

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

Mr ANTHONY:
PostmasterGeneral · Richmond · CP

Mr RIORDAN:
Kennedy

Mr CASEY:
Minister foi National Development and Minister for Works and Housing · La Trobe · LP

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

Dr EVATT:
Barton

Mr ACTING DEPUTY SPEAKER:
Mr. Ryan

Mr GULLETT:
Henty