House of Representatives
26 October 1950

19th Parliament · 1st Session

Mr. Deputy Speaker (Mr. C. F. Adermann) took the chair at 10.30 a.m., and read prayers.

page 1465




– Is the Prime Minister aware Chat the chairman of the conference of State Ministers administering prices control, Mr. Finnan, has stated that he is in favour of handing over prices control to the Australian Government because it is impossible for the States adequately to control prices since they have no power over imports or exports and cannot finance the payment of subsidies in respect of those commodities and goods which require the payment of subsidies in order to keep down prices! Is it a fact that it will be impossible for the States to take the steps to check the increase of prices that are so essential to the achievement of a stable economy in this country? Will the Prime Minister agree to have the control of prices taken over by the Australian Government, if the States are agreeable to transfer the necessary powers to the Commonwealth!

Prime Minister · KOOYONG, VICTORIA · LP

– I have not seen a statement such as that to which the honorable member has referred, and I have no idea whether one has been made. However, I can inform the honorable gentleman that only this morning I was in communication with Mr. Finnan and we have actually arranged the date and place of a meeting at which the State Ministers will discuss’ with me the problem of making their work more effective, insofar as Commonwealth co-operation oan assist in doing so. I anticipate that the discussions will be useful.

page 1465




– I direct to the Postmaster<General a question that arises from representations that I have made in respect of the granting of a commercial broadcasting station licence for the Manning River Valley area, which includes such important towns as Taree and Wingham. Such a facility is very urgently needed in that area, particularly for the purposes of issuing flood warnings. Can. the Minister advise the House whether progress is being made in negotiations to overcome the technical difficulties that, I understand, have delayed a decision in this matter, and whether it is yet possible to make a channel available so that the necessary licence can be granted?

Postmaster-General · RICHMOND, NEW SOUTH WALES · CP

– I have given a good deal of attention to representations that have been made by the honorable member for Lyne and other honorable members in connexion with the issue of commercial broadcasting licences for a number of country areas. Many of these districts are clamouring for a commercial broadcasting licence, but it has not been possible to grant them owing to the limited number of frequencies available and also owing to the fact that we must consult in respect of such matters with the broadcasting authorities in Kew Zealand, because that country’s frequencies are not very far away on the broadcasting band from those of Australia. My officers have just returned from New Zealand after having had a conference with New Zealand broadcasting officials, and it is hoped that we shall be able to straighten out a number of matters in connexion with frequencies that concern both countries. I have asked the Australian Broadcasting Control Board to examine the possibilities of granting licences for low-power commercial stations in various parts of Australia. At the present time I have about 1,500 applications for licences for commercial stations from many parts of the Commonwealth, but it is not possible to grant more, than a few of them under present conditions. However, the matter that the honorable gentleman has raised is being examined, and I hope that it will be possible to do something, not only in respect of Taree, but also in respect- of. a number of other districts.

page 1466




– Can the Minister acting for the Minister for Commerce and Agriculture inform the House of the nature .of the arrangements entered into between the United Kingdom Government and the Australian Government through the honorable member for Franklin, who has just returned from the United Kingdom, where he bad gone, I understand, for the purpose of negotiating for the sale of Australian apples, particularly from Tasmania, during the forthcoming export season?


– The honorable member for Franklin has been discussing with interests in the United Kingdom - not necessarily the United Kingdom Government - the question of the disposal of Australian apples. He has done a very good job. I believe that the Minister for Commerce and Agriculture will himself be back in -Canberra to-day.

Mr Pollard:

– Did it take two of them to do the job?


– No. The honorable member for Franklin handled the matter quite capably. The Minister for Commerce and Agriculture, I understand, will be in Canberra to-day- and I suggest that he should answer the question himself.

page 1466




– I ask the Minister acting for the Minister for the Interior whether it is a fact that a considerable sum of money is being lost each year in the conduct and control of hotels and hostels in the Australian Capital Territory? Is it a fact that approximately 33 per cent, of the total cost of the conduct and control of these hotels and hostels is attributable to overhead departmental administrative charges? Is it also a fact that guests who arc staying at the hostels controlled by. the Department of “Works and Housing, whilst paying a uniform rate for accommodation, ave not enjoying a uniform type of comfort and convenience? Has it “been threatened that the “ blitz “ against guests occupying these hotels will be directed against politicians who occupy government-controlled hotels as from the 9th November, and that they will be seriously inconvenienced and suffer considerable financial loss by the proposed action? Has the department taken into consideration the effect that the proposed increase of tariff will have on the losses of the Parliamentary Refreshment Rooms? Will consideration be given to the setting up of a non-party committee composed of members of both Houses of the Parliament in order to investigate the present conduct and control of all hostels and hotels controlled by the Government in the Australian Capital Territory?


– I have only just assumed control of the department and I am indebted to the honorable member for the information which he has supplied concerning certain aspects of that department. I shall certainly investigate the matter that he has raised.


– Is the Minister for Works and Housing aware that certain areas of Canberra are being ‘blacked out regularly because of electricity restrictions? In common with many other people I was obliged to dine last night by candle-light. In view of the statements that the honorable gentleman made in this chamber yesterday about the efforts that he had made to provide additional electric power for the public, I ask him whether the black-outs in Canberra are the first fruits of his labours?

Minister for Works and Housing · LP

– The question could have been addressed more properly to the Minister for the Interior. However, insofar as it may be thought to affect me, I shall investigate the matter and advise the honorable member of the result of my inquiries.

page 1467



– Does the Prime Minister believe that the Australian Labour party supports or advocates the objectives, policies, teachings, principles or practices of communism as expounded by Marx and Lenin? Does the Prime Minister believe that the policy of the Australian Labour party is influenced substantially by persons who support or advocate the objectives, policies teachings, principles or practices of communism as expounded by Marx and Lenin? If the answer to either of the foregoing questions is in the affirmative, and having regard to the subversive definition given to communism in the Communist Party Dissolution Act 1950, does .the Prime Minister intend to ask the investigating committee to consider whether the Labour party should be ‘ declared unlawful?


– It will be a great, relief to the honorable member for Hindmarsh, I am sure, to be told that the Government is not contemplating any proceedings against the Australian Labour party except, of course, in the strict way of business at an election.

page 1467




– My question is directed to the Minister for National Development and Minister for Works and Housing. I think that the question may be appropriate to both those portfolios. Does the Government consider it of major importance that the population of Australia should be more evenly distributed? Is it a fact that if the housing shortage in our capital cities is overcome there will be little hope of a balanced population distribution ? Is the Government pursuing a country before city housing policy, and if so with what, result?


– The answer to the first part of the honorable member’s question is in the affirmative. As many houses as possible, so far as this Government is able to direct them, are being directed to country areas. About 30 per cent., or more, of the houses built under the Commonwealth and State Housing Agreement are in country areas. With war service homes & policy is being adopted which is favorable to country areas while not being to the detriment of city areas. Building outside of the metropolitan areas is subject to disabilities and difficulties greater those encountered in the metropolitan areas. However, the Government and the departments for which I am responsible, are well aware that housing in country areas must be improved as one of the principal methods of stopping the drift from country areas to the city. That has been recognized as a cardinal point in our policy. If the honorable member can suggest any means whereby our policy can be more actively pursued, I shall be grateful to hear of them.


-I ask the Minister for Works and Housing whether the Commonwealth and State Housing Agreement provides for a defined method of ascertaining the capital costs of dwelling.1; for the purpose of calculating economic rents ? Has the Auditor-General of New South Wales reported that that part of the agreement with the Commonwealth is being departed from by the New South Wales Government? Can the Minister say whether this departure is causing additions to the rentals that are paid by tenants who occupy Housing Commission homes in New South Wales ?


– The Housing Division of the Department of National Development compiles a housing index, which is published quarterly, and sets out the capital costs of houses under a great many detailed headings. The. Commonwealth and State Housing Agreement contains provisions that lay down with some precision the method of calculation of rentals to be adopted by the State governments. I have not had the advantage of seeing the report of the New South Wales AuditorGeneral, but, as the honorable gentleman has directed my attention to it, I shall have it investigated and ascertain whether it is necessary to pursue the matter any further.

page 1468




– Is the Prime Minister aware that as a consequence of the policy pursued by the gramophone monopoly known as E.M.I. Sales and Services Limited, Australia is practically the only country in the world which does not make recordings of its own national composers’ serious works? Will the Prime Minister endeavour to persuade E.M.I, to record serious Australian compositions, or failing this would he consider setting up a small Government agency to record worthwhile local compositions such as John Antill’s Corroboree, or Alfred Hill’s Hinemoa.


– I am not aware of the circumstances initially stated by the honorable member, although I find myself in general sympathy with his view that there should be effective recordings of Australian works such as he has mentioned. I shall certainly look into the matter.

page 1468



– In view of the great amount of publicity and interest following a recent* broadcast that beef raised in central Queensland gained 100 per cent, marks in the world competition for beef in England, which record of course can never be broken, and as I understand that negatives of photographs taken at the time are available, would you, Mr. Deputy Speaker, give consideration to having the negatives printed and photographs of this prize-winning beef displayed in Parliament House.


-I shall give consideration to the honorable member’s question and let him know the result of that consideration.

page 1468




– My question is directed to the Treasurer. In 1946 the Joint Organization was set up to deal with the disposal of Australian wool and I understand that in 1946 £5,000,000 was paid into the fund of that organization. 1 also believe that in subsequent years the following amounts were paid in: - 1947, £750,000; 1948, £750,000; 1949, £500,000 ; and 1950, £500,000. Will, the Treasurer state the amount paid into the fund each year and also the total amount now in the fund.


– I shall have the information prepared and supply it to the honorable member.

page 1469




– By way of explanation of my question I inform the PostmasterGeneral that there are several newly developed centres in my electorate which lack telephone facilities. As a temporary expedient I have applied for the installation of public telephones, but have been informed that further action cannot be taken because of lack of materials. Will the Postmaster-General give consideration to the granting of a high priority to the installation of telephones in newly developed and rural areas where no such facilities now exist?


– I shall certainly give consideration to the suggestion that the honorable member has made.

page 1469




– Can the Treasurer say whether the Government, since it assumed office, has increased the import quota of newsprint from dollar sources? If so, why has that increase been granted?


– Since the Government assumed office, the importation of most goods has been increased because of the increased dollar resources that the Government has been able to make available as a part of its general financial policy.

page 1469




– I ask the Postmaster-General, who represents the Minister for Fuel, Shipping and Transport, whether the report is correct that the Commonwealth Railways Commissioner is purchasing diesel rail cars as distinct from diesel electric locomotives from the United .States of America ? The report to which I refer also states that these diesel rail cars are capable of travelling “at speeds of up to 85 miles an hour. If that report is correct, what portions of the road bed of the Trans- Australian Railway are safe for such speeds ? Would not diesel rail cars that are capable of speeds of up to 60 miles an hour, of which several are being purchased by the Victorian Government from the sterling area, be equally suitable for use on the Commonwealth railways, and would not the pur chase of such cars enable the Government to save dollars?


– I shall refer the question that the honorable member has asked to the Minister for Fuel, Shipping and Transport with the object of obtaining for him a full answer.

page 1469




– I address a question to the Minister for National Development that is based on a statement that was made in the policy speech of the Treasurer, as Leader of the Australian Country party, at the last general election. That document is indexed in the National Library as No. B329 : 994. In it the right honorable gentleman stated that the sum of £250,000,000 would be raised, apart from funds for the Snowy Mountains hydroelectric power scheme, for national developmental works and that the money would be made available to State governments and local government authorities in respect of any works that fitted into the Government’s scheme for national development. He added -

No repayments of National Development loans will be required from any State or local authority for moneys received or spent under this scheme.

Has any part of that sum of £250,000,000 been raised, or is any of it being raised? If so, have any amounts been made available to local authorities on the condition that those bodies shall not be obliged to repay such moneys? If such amounts have been made available, what is the nature of the works for which they have been allocated ?


– The statement from which the honorable member has quoted refers to expenditure that is to be incurred not in any one year but over a period of years. The Government’s national development programme entails the beginning of the implementation of the matters that the honorable member has mentioned. I shall obtain the details and supply him with a more specific reply.

page 1469




– Has the Minister for Defence any information regarding the reported invasion of Tibet by forces of the Chinese Communist Government? As he is aware, the United Kingdom Government has recognized the Chinese Communist Government. In view of this report, and as Tibet adjoins India and Pakistan, has he any knowledge of what effect this move is likely to have upon diplomatic relations between the United Kingdom Government and the Chinese Communist Government?

Minister for Defence · WAKEFIELD, SOUTH AUSTRALIA · LP

– I have no official information concerning the reported invasion of Tibet by Chinese Communist forces. I am aware that the Chinese Communist Government has been recognized by the United Kingdom Government, but I do not think that an invasion of Tibet would necessarily have any adverse effect upon the diplomatic relations between the United Kingdom Government and the Chinese Communist Government. The United Kingdom has not guaranteed the sovereignty of Tibet, and I imagine that, in the event of a Chinese Communist invasion of Tibet, the way would be open for that country to refer the matter to the United Nations for consideration and the taking of any action that might be deemed necessary in the circumstances.

page 1470




– Has the Prime Minister seen in this morning’s press a reportby no less an authority than an official correspondent of the London Times that the South Koreans have been guilty of atrocities as great as those that were perpetrated by the North Koreans, that they have incarcerated prisoners of war in dark dungeons for many day?> have clubbed them with rifles and have resorted to the old Chinese torture of putting lighted matches under the finger nails of their victims? In these distressing circumstances, will the Prime Minister take immediate steps to contact the United Nations Commission for Korea and Australia’s representative on the seven nations commission and repudiate such acts, which are breaches of the Geneva Convention, so as to establish in the minds of people throughout the world that, although South Korea is our ally, we and the army of the United Nations do not countenance atrocities?


– I have not seen the report that the honorable member has mentioned and I certainly have no official knowledge of any such matters. Therefore, it would be a little odd, I think, for me to offer any repudiation in the circumstances. Australia is represented on the commission that is being established by the United Nations and I have no doubt that that body will be in the best possible position to ascertain the facts and to make any report that may be necessary to the United Nations.


Minister for the Army and Minister for the Navy · Moreton · LP

by leave - I desire to make a brief statement concerning further casualties in the Australian forces in Korea. Advice has been received by me that some casualties have occurred as a result of Australian troops taking part in the fighting in northern Korea. I am pleased to say, however, that no fatal casualties have been reported. Seven members of the Australian battalion have been wounded, and their nextofkin have been advised by telegram of the facts. Immediately I receive confirmation that next-of-kin have received advice, the names of the soldiers concerned and the nature of their wounds will be released for publication.

page 1470




– Can the Minister for Labour and National Service inform me whether it is a fact that the shipping hold-up in the port of Newcastle has ended with the shipowners agreeing to abide by the longestablished practice of allowing seamen to select the vessel upon which they desire to work? Will the Minister state whether that matter was the cause of the dispute in the first instance? Will he explain his statement, ‘ in reply to a question by a Government supporter some time ago, that the dispute was a part of a Communist plot to hold up production in the steel industry? Will he now admit that, if any such plot existed to hold up production in the steel industry, it was on the part of the employers and not of the men?

Minister for Immigration · HIGGINS, VICTORIA · LP

– I understand that it is a fact that work will be resumed on the vessels to which the honorable member for East Sydney has referred, and arrangements are now well in hand for the supply of crews to all the ships which were temporarily tied up in the port of Newcastle. It is not a fact that the immediate cause of the trouble was that only one ship could not get a full crew. Several ships were not able to complete their crews, and the shipowners gave notices of dismissal to the crews, with the object of awaiting the time when a full crew would be available for each of the ships.

Mr Ward:

– That is not true.


– Subsequently, calls were made for the ship in question, as it was the vessel which had been waiting longer than any other to secure a full crew. I repeat, since the honorable member challenges my statement, that when the notices of dismissal were given, several ships had been unable for some time to secure a full crew. The honorable member also asked whether it was a fact that I made a statement of belief to the effect that the hold-up of shipping, at Newcastle formed a part of an organized campaign to retard the production of steel at and the shipment of steel from Newcastle. I made that statement publicly. It was not merely my own belief, because it was confirmed by two senior Ministers of the Government of New South Wales. That belief was also shared by several members of the Opposition in this Parliament, who discussed the matter with me.

Mr Ward:

– That is not true.


– The honorable member seems to have a faculty for intuition.

Mr Ward:

– Who are they?


– Order I The Minister is entitled to be heard in silence when he is replying to a question.


– I discussed the matter with other members of the Labour party in the Parliament, who come from the same district, and they also confirmed that view.

Mr Ward:

– I do not believe it.


– That was’ their belief. It was the view of our own industrial officer in the port of Newcastle, and of the Coal Industry Tribunal, who sent an official communication to the Government in which he asked that a special tribunal be constituted to make an inquiry into the situation. In point of fact the Government instituted inquiries in various directions. Some of the reports have already reached me, and I understand that others will reach me to-day. We shall than decide whether, in our view, any further action arising out of those reports, is deemed necessary.

page 1471




– My question to the Prime Minister is prompted by the increasing deathroll from road accidents. I realize that there is a federal organization, the Road Safety Council, in existence, and that the subject of my question may be put aside on technical grounds as a State matter. I ask permission to read one paragraph from a letter written on behalf of the Swan Hill Chamber of Commerce. It is as follows : -

We are informed that there is nothing to stop a person who is debarred from holding a driving licence in one State, from obtaining a, licence from a neighbouring State and once more becoming a menace to other road users.

The next time the Premiers assemble in Canberra, will the Prime Minister endeavour to have conditions relative to State motor registrations, and the issue of drivers’ licences, made more uniform and rigid ?


– The matter referred to by the honorable member falls within the purview of the Minister for Fuel, Shipping and Transport, but I shall discuss it with my colleague.

page 1471




– Can the Minister for Immigration say whether it is a fact that from 80,000 to 90,000 British migrants will be brought to Australia within the next twelve months, and will he also inform the House of the method of selecting migrants that is followed by the department? Because of the shortage of labour in the mining industry, will the Minister consider including mine workers in Great Britain, many thousands of whom have relatives in this country, amongst the migrants selected to come here? Is it correct that the British Government does not like to lose mine workers to Australia?


– The Government hopes that next year it will attract to Australia approximately 80,000 or 90,000 British settlers. By the end of December we shall have brought to Australia nearly 80,000 British migrants this year, which will be, I understand, a record. Migrants from Great Britain are made up of different categories. Some of them are fullfare paying passengers, who come out on their own initiative; the members of another group are nominated by friends, relatives and employers; and those in a third group represent a new development that was instituted by the present Government this year, and comprise persons nominated by selection committees who are accommodated on their arrival in hostels provided by the Government. The aspect to which the honorable member has particularly referred, of attracting to Australian mine . workers to go into our coal-mining districts, has been very much under consideration by the Government, and we have advanced our plans to the stage where a decision has been taken to establish hostels in the mining districts. It is hoped that we shall obtain workers to come into those hostels and into the labour forces that will be working our coal-mines, particularly in New South Wales.

page 1472




– The honorable member for Henty addressed a question to me yesterday regarding lobbying in this building and suggested that persons, other than those visiting members by appointment, should not be admitted to the lobbies. I wish to inform the honorable member that the existing rules governing the use of the lobbies, which are exhibited at the various entrances, state clearly that the lobbies are strictly private and that strangers are not permitted to remain in or about any of the passages between the chamber and the various rooms set apart for the exclusive use of members. In view of the complaints made by the honorable member for Henty, I have repeated previous- instructions to the. attendants of the House to the effect that strangers found in the lobbies must be asked to leave. It would be appreciated if members also would co-operate in this matter by ensuring that persons visiting them are not left unattended in the lobbies.

page 1472




– Many young men in Sydney, including particularly a number who ‘are attending the technical college for the purpose of taking diploma courses in chemistry and engineering, and who use B.S.A. army model motor cycles, have tried during the last six months to obtain tyres size 350 by 19 by 14, for their motor cycles, but have been informed by the tyre distributors that such tyres are unprocurable on the Sydney market. In the interests of the young men concerned, will the Minister for Supply make arrangements to have tyres of this description made available immediately ?

Minister for Supply · PARRAMATTA, NEW SOUTH WALES · LP

– -The distribution of motor cycle tyres within Australia does not come within the purview of the Department of Supply. The department controls the export to places abroad of tyres and rubber materials, but I repeat that neither the Department of Supply nor any other Commonwealth department has any control over the0 internal distribution of tyres. However, I shall look into the matter raised by the honorable member in order to see whether anything can be done to facilitate the supply of motor cycle tyres.

page 1473


Motion (by Mr. Anthony) agreed to -

That leave be given to bring in a bill for an act to amend the Post and Telegraph Rates Act 1902-194!).

Bill presented, and read a first time.

Second Reading

PostmasterGeneral · Richmond · CP

hy leave - I move -

That the bill bc now road a second time.

This bill deals with an amendment of the Post and Telegraph Rates Act 1902- 1949 to enable certain postal and telegraph rates to be increased to amounts more in keeping with present-day operating costs and conditions. Before outlining the manner in which it is proposed to adjust these tariffs, and also the charges for telephone services, I shall show honorable members why it is necessary to take this action, seeing that the rates were increased by the previous Government in the middle of 1949. I feel that when honorable members are made aware of the position, they will have no hesitation in supporting the proposals.

Since 1912, in accordance with the express wish of the Parliament, the Postal Department has prepared its balance-sheets on a commercial basis, which takes- into consideration the value of services performed for other government departments, such as the transmission without charge of meteorological telegrams and the payment of pensions, for which it does not receive full cash payment.

With the exception of 1930-31, when a small loss was recorded, the commercial balance-sheets of the Postal Department showed substantial profits over a period of twenty years, particularly during the war years and the first complete postwar year when the financial results of the department’s operations were influenced by the following abnormal factors: - The transport and delivery by the armed forces without cost to the Postal Department of an ‘ enormous volume of mail matter addressed to service personnel, the curtailment of maintenance work in order to conserve materials and man-power, the effect of wage and price pegging, the virtual suspension of staff recruitment and training, and the inability of the Department to incur expenditure on normal service improvements. Evidence of this is the fact that the highest surplus ever recorded by the Postal Department was £6,674,595 in 1944-45, whereas the greatest peace-time profit was £3,625,371 in 1938-39 immediately prior to the war. Since 1944-45, despite the utmost care in administration and close supervision of expenditure, the Postal Department has been unable to avoid a very heavy increase of costs of providing essential postal and telecommunication services. Those inescapable extra costs have been due chiefly to -

Increased wages as the result of arbitration awards, the 40-hour week, higher prices of materials, sharp rises in the costs of carriage of mails by rail and road, additional maintenance resulting from deferment of much maintenance work during the war years, and recruitment and training of additional staff necessary to restore the services to a reasonable level of efficiency and to expand and develop facilities to meet essential public needs.

The financial effect of those greater operating costs inevitably converted the surplus into a deficit. In 1947-48 the profit was only £1,849,781, and in the following year there was a loss of £1,722,993, excluding a deficiency of £1,146,724 that arose from the operation of broadcasting services. The wireless branch is not a commercial undertaking, and its financial results are now omitted from the Postal Department’s balancesheets. Apart from the wireless branch, a deficit of £5,000,000 was expected in 1949-50 on the basis of the rates in force, but postal and telegraph rates were adjusted in July, 1949, following . an amendment of the Post and Telegraph Rates Act, and the charges for local and trunk-line telephone services were also varied by a revision of the relevant regulations. As a result, the loss for 1949-50 was reduced to an amount of about £1,500,000, despite the fact that inescapable increases of labour, freight and maintenance costs totalled more than that amount, an eventuality which could not be foreseen at the time that the rate adjustments were made.

Since the amendment to the act was made in June, 1949, there has been a further heavy increase of the working expenses of the Postal Department. The annual wages bill has risen by £5,250,000, including £2,000,000 in. respect of cost of living adjustments, £750,000 under arbitration awards and £2,500,000 for wagesand salaries of new staff. The cost of road, rail and air mail services has increased by more than £1,000,000, and the expenditure on maintenance materials has increased by nearly £500,000.

Honorable members will be interested to learn that in 1944-45 the department’s annual wages bill was less than £14,000,000. This financial year, even without the recent basic wage increase of £1 a week and the cost of living adjustment from the 1st November, it will exceed £33,000,000. “Wages of new staff to cope with expanded activities account for only £8,000,000 of this increase, the remaining £11,000,000 being due to higher wage rates. The basic wage judgment delivered by the Full Arbitration Court on the 12th October may add more than £4,000,000 to the department’s annual expenditure on operating and maintenance staff. I interpolate here that capital costs will be increased by an additional £2,500,000 as a result of that judgment, so that the actual new cost to the Postal Department of the £1 a week increase will be £6,500,000 or £7,000,000.


– What does the Minister mean by “ capital costs ? “


– I mean the expenditure on the construction of post offices and other buildings, as apart from the provision and maintenance of services.


– Do not the sums for such expenditure come out of Consolidated Revenue ?


– Not necessarily. Portion of them comes from loans. Each ls. a week increase in the basic wage adds £200,000 to the department’s annual wages bill, including £25,000 for men engaged on capital works. The increase of the basic wage, when operative, will also affect immediately the costs of the department’s stores and materials.

A good deal has been said and written about the effect on the national economy of the introduction in January, 1948, of the 40-hour week! I do not propose to comment on that matter other than to say that the 40-hour week reduced the effective working time of a considerable proportion of the staff of the Postal Department by at least 8 per cent., and that much additional overtime at penalty rates has since been necessary to enable the department to continue to give the desired amount of service to the public. In 1946-47 the overtime bill was £317,000; last financial year it was nearly £1,300,000. It is estimated that the immediate direct effect of the 40-hour week has been to increase the department’s labour costs by about £1,000,000 yearly. The indirect effects, on the costs of materials, freights and so on, have also inflated expenditure.

Higher prices for materials have also added greatly to the costs of operating and maintaining postal services and of the expanded capital works programme. Since the war ended prices of materials used by the department have increased to an extraordinary degree. For example, automatic exchange equipment is 60 per cent, dearer; telephones and switchboards cost 50 -per cent, more ; and materials used in trunk line construction have increased in cost by 130 per cent. Materials used in maintenance work cost £702,000 in 1944-45, £1,637,000 in 1948-49 and, even on the basis of present prices, will cost well over £2,000,000 during the current year.

Comparing the prices of materials ten years ago with present prices, the increase has been phenomenal. For example, the cost of automatic exchange equipment has risen by more than 100 per cent., that of telephones and switchboards by 150 per cent., and that of underground cable by 250 per cent. During the war years much maintenance work had to be suspended, and it is only recently that the department has been able to increase its staff to a level that has enabled it to undertake an appreciable portion of this deferred maintenance. The extra work now being carried out has further increased annual expenditure. In 1944-45 the cost of conveying mails by road, rail, sea and air was £3,440,000, but sharp increases of charges made by contractors have been so heavy that it will cost at least £5,000,000 to maintain these services during the current financial year, which represents an increase of well over £1,000,000 on expenditure for 1948-49.

In the face of all these higher costs, the Postal Department has, since 1941, /made only one increase of its charges - the 1949 variation of postal, telegraph and telephone rates, which represented an overall increase of earnings of only 16 per cent. Having regard to the rise of 70 per cent, in the average wages of the staff, without allowing for the recent basic wage increase, the cost of living adjustment of £18 a year from the 1st November, and the marked rises of prices generally, I am sure honorable members will agree that the relatively small percentage increase which has taken place in the Postal Department’s rates generally during the past ten years is a tribute to the efficient and economical manner in which the department has managed its affairs.

If wages and prices of materials and freights were still at the 1944-45 levels the department would have recorded a profit of something like £11,000,000 in its commercial accounts for 1949-50, instead of a loss of about £1,500,000. Increased rates which applied in 1949-50 gave additional revenue of little more than £5,000,000. These increases were designed to eliminate the deficit but, as I have said, this was not possible because of further unforeseen rises in wages and material costs.

Although the business of the post office has increased rapidly and will continue to grow, earnings have not kept pace with spiralling costs of labour and materials. To ‘ illustrate this, I would point out to honorable members that in 1944-45 the average cost of handling 1,000 originating postal articles was £8 2s., by 1948-49 it had risen to £10 8s., and since then it has risen to £12 6s. The cost of handling 1,000 telephone calls rose from £13 6s. in 1944-45 to £17 18s. in 1948-49, and to-day it is £22 2s. The cost of handling 1,000 originating telegrams increased from £63 8s. in 1944-45 to £114 12s. 6d. in 1948-49, and to-day it is £151 18s. These figures speak for themselves.

In the face of these extraordinary increases in costs which are due to factors beyond the control of the department, it is little wonder that the post office will record a deficit in its commercial accounts for 1950-51. In the light of known and probable extra costs during the present financial year, it is estimated that a loss of at least £8,000,000 will be sustained in the post office accounts unless Parliament approves an increase in tariffs. The ideal for a postal administration is to provide adequate and satisfactory services and at the same time be self-supporting. Unfortunately, the achievement of this ideal cannot be accomplished. In the first place, the rate increase, if approved by Parliament, will operate for only seven months of the present financial year. They will operate from the 1st December if they are passed by Parliament in time. Every month’s delay will cause a loss of a further £500,000. Secondly, the recent basic wage adjustment and cost of living increase will add greatly to post office expenditure this year. These tariffs do not take into account the £1 a week increase granted by the Arbitration Court. Therefore, despite the increases dealt with in this bill, a heavy deficit for the current year is unavoidable. The Government had decided, however, to approach the matter on an interim basis and to review it again, in the light of actual results and the precise effect of the revised tariffs, at a later date. A further statement will be made to Parliament when the effect of the new basic wage is known.

If the post office continued existing charges in the face of the sharply increasing costs, the alternative to a serious and continually rising deficit would be to reduce drastically postal, telephone and telegraph services to the public at a time when the demand is most pressing. Such action would retard national development and cause embarrassment to primary and secondary industries particularly and could not be countenanced by the Government which recognizes full well the importance to the community of an efficient and comprehensive communications system.’ For the reasons I have mentioned, the only sensible and practical course is to increase charges to a reasonable extent to enable the post office to operate on a sounder financial basis. Accordingly, proposals for higher tariffs have been developed on an equitable basis having regard to a number of factors, which are : the cost of providing services ; the comparable charges in other countries ; the need to maintain and expand efficient facilities for . the public; and the importance of providing relatively cheap service to rural areas. The Government is satisfied, after examining the position carefully, that the proposed charges are fully justified in view of the inescapable increased costs which the department has to meet. I shall now indicate briefly to honorable members the nature and extent of the proposed adjustments. In connexion with the postal charges, the bill now .before the House provides for the following revision of rates : -

Letters. - Tim existing charge of 2id. for the first ounce or part of an ounce will be increased to 3d. The charge for each additional ounce or part of an ounce will be increased from 2d. to 2£d.

Letter-cards. - The existing charge of 2£d. will be increased to 3d.

Post-cards. - The existing charge of 2d. will be increased to 2Jd.

Commercial papers, patterns, samples and merchandise. - The existing charge of lid. for the first 2 oz. or part of 2 ox. will be increased to 2d., .but the present charge of 1 1/2 d. for each additional 2 oz. or part of 2 oz. will be continued.

Printed matter, including printed papers, circulars, catalogues and books, and publications not registered for transmission as newspapers or periodicals. - The existing charge of 1-Jd. for the first 4 oz. or part of 4 oz. will bo increased to 2d., but the present charge of lid. for each additional 4 oz. or part of 4 oz. will remain the same.


– Will this affect the air-mail rate?


– I- shall come to that later, but it will not, in fact.

No increase has been made to the rate for letters since 1941, when it was raised from 2d. to 2£d. The present fee represents an increase of only 25 per cent, on the rate in force twenty years ago. Although an increase of £d. was made in 1949 in the charge- for each additional weight unit of commercial papers, printed matter and the like, the fee for the first weight unit has not been altered since 1941. The existing rates are inadequate under present’-day conditions. I feel sure that the honorable member for Parkes (Mr. Haylen) will welcome this announcement. No change will be made in the current rate of 1-Jd. for each 6 oz. which applies to publications registered for transmission as books and to single copies of newspapers and periodicals, as the Government recognizes the importance of encouraging Australian authors and publishers. The concession rate of ltd. for 12 oz. applicable to Commonwealth and State Hansards will also be retained. This might possibly improve the mind of the reading public. No alteration is proposed in the bulk rate of 2£d. for each 16 oz. in respect of publications registered for transmission as newspapers and periodicals. The greater proportion of these journals are published in the metropolitan areas, but many are sent to subscribers in country districts. In addition, country newspapers utilize the system for distributing copies to subscribers in outlying areas, and the concession is also beneficial to a number of non-commercial bodies, including churches, ex-servicemen’s associations and organizations of employers and employees which publish journals coming within the scope of newspapers and periodicals as defined in the Post and Telegraph Act and regulations.

Consequent on the variation in domestic postage charges, it will be necessary to make adjustments in some Empire and foreign rates, and the necessary executive action will be taken concurrently with the enactment of this legislation. The most notable variation is an increase from 3-Jd. to 5 1/2 d. for the first ounce in respect of letters addressed to foreign countries, this adjustment being necessary as a result of the devaluation of the Australian £1, to keep within the limits prescribed by the Universal Postal Convention to which the Commonwealth is a signatory. The convention lays down on a gold franc basis the minimum and maximum postage rates which shall be applied by member countries to postal articles addressed to other countries.

Amendments to the Postal Regulations are being made to increase the charges for parcels and the rentals for private boxes at post offices. It is proposed to adjust the parcels rate schedule by making some increases. For example, the minimum charges applicable to a parcel weighing up to 1 lb. will be raised in the following manner : -

For delivery within 30 miles - Increase from 6d. to 9d. ,

For delivery elsewhere -

Within State of posting - Increase from 9d. to1s.

In adjacent State - Increase from1s. to 1s. 9d.

In distant State - Increase from1s. 3d. to 2s.

Corresponding adjustments will be made in the rates for heavier parcels. The maximum increase will be from 7s. 3d. to 8s. 9d. for a parcel weighing 11 lb. addressed to a distant State. The present parcels rates were fixed in 1929 and the revenue derived falls far short of the costs incurred in their treatment, conveyance and delivery. The Postal Department loses very heavily on the handling of parcels. The rates applied are nothing like sufficient to cover the cost of the service performed. The rates are generally much lower than those charged by the railway departments. The Postal Department would be justified in imposing, purely on a cost basis, much higher rates than those now put forward.

The rentals for private boxes have been in force since 1914 and present-day costs justify a substantial increase. It is proposed to double the charges for boxes at general post offices and to increase the rates at other post offices by up to 50 per cent. Under the new scale the yearly rental for an ordinary sized box will be £2 at general post offices and 15s. at other post offices.

The bill also provides that the base rate for ordinary telegrams up to fourteen words shall be increased from1s. 3d. to1s. 9d. where the offices are not more than 15 miles apart and from1s. 6d. to 2s. in all other cases. The present practice of charging urgent telegrams at double rates will be continued. The charge for each additional word beyond fourteen has remained unchanged at1d. since federation and is far too low in the light of existing costs. It is proposed, therefore, to increase the rate to l½d.

No change is contemplated in the tariffs for lettergrams and press telegrams. Due to the greater use of aircraft for conveying surcharged airmails, the use of lettergrams is declining, and press telegrams are also decreasing in numbers as the result of the adoption of leased teleprinter services. The major users of the press telegram service are the country newspapers. The additional fee of 2d. at present charged for a phonogram, that is, a telegram telephoned to the telegraph office for onward’ despatch, is not sufficient to cover the cost of operation, and an increase to 3d. is to be made by an amendment to the Post and TelegraphRegulations. At the same time, it is proposed to increase from 2d. to 3d. the fee which is charged, in addition to the normal telegraph tariff, when a telegram is lodged at a telegraph office through a private teleprinter service.

Although the charges for telephone services are to be adjusted by an amendment of the telephone regulations, I shall outline briefly for the information of honorable members variations which are proposed in rentals, local call fees and trunk-line charges. Increases in telephone subscribers’ yearly ‘rentals will range from 7s. 6d. for subscribers in local call areas with 1,001 to 2,000 lines to £1 15s. for business services in Sydney and Melbourne. The rentals for business services will be increased by £1 12s. 6d. in Brisbane, Adelaide and Perth, and by £1 7s. 6d. in Hobart and Newcastle, while therentals for residence services will be raised by £1 5s. in Sydney and Melbourne, £1 2s.6d. in Brisbane, Adelaide and Perth, and 17s. 6d. in Hobart and Newcastle. One effect of the adjustments will be to widen the margin between rentals for business and residence services in those telephone networks where there are differential rates.

The rentals for services connected to exchanges with local call areas of 1 to 300 lines will be reduced by 5s., while no variation will be made in the rentals for areas of 301 to 1,000 lines. These exceptions to the general increase are considered to be justified in order to give effect to the policy of the Government to improve conditions in rural areas. They will also offset to some extent the increase in the ‘unit fee for local calls in these groups ‘to which I shall now refer.

At present the unit fee for a local telephone call is where the local call area is restricted to 300 lines or less, 1 3/4 d. in other country districts and 2d. in metropolitan areas and Newcastle where special network conditions apply. It is proposed to introduce a uniform unit fee of 2d. for local calls. The Postal Department makes no distinction in the charges for postal articles and telegrams, and it is desirable to extend the principle to local telephone calls. The charges for trunk line calls made between 9 a.m. and 6 p.m. will be increased by amounts varying from Id. for calls under Ti miles to 4s. 2d. for calls over 1,300 miles. Rates for calls made during night hours, that is 6 p.m. to 9 a.m., will be raised by sums varying from Id. for calls under 7£ miles to 3s. 2d. for calls over 1,300 miles.

It is also intended to increase by amounts varying from Id. to 2s., according to the direct distance between the trunk line offices concerned, the additional fees which are charged in cases where calls are made to specified persons or extension ‘telephones. Although these fees were raised in 1949, they do not compensate for the special service provided and the extra trunk line time occupied.

No increases are to be made in the extra mileage charges for telephone subscribers extending beyond a radius of 2 miles from the exchange or in the tariffs for extension telephones, switchboards, and miscellaneous apparatus.


– How will this affect overseas telephones?


– That is a different matter altogether. I am referring to local telephones at present. Adjustments to the charges for overseas telephone calls will be made in consultation with countries overseas. The extra mileage charges have been fixed at a nominal figure to meet the needs of outlying localities. Recently I gave in the House an outline of the more liberal conditions which have been introduced by the Government relating to the provision of telephone services in country districts.

The general effect of the proposed increases in postal, telegraph and telephone rates will be to raise the Postal Depart ment’s earnings ‘by only 16 per cent. The cumulative result of the 1949 and 1950 adjustments will be to increase the earnings of the Postal Department by about 35 per cent., which is a very moderate increase having regard to existing ‘circumstances and the much higher rises which have taken place in wages and costs generally. In general, the new tariffs will still compare favorably with those in operation in other English-speaking countries. For example, the basic letter rate of 3d. will .be less than the equivalent charges in the United States of America and the United Kingdom. A fourteen word telegram from Brisbane to Perth will cost 2s., whereas a similar message from New’ York to :San Francisco costs 16s. 2d. The charge for a trunk line call from Sydney to Melbourne will be 9s., compared with lis. in South Africa, 14s. Id. in the United States of America and 23s. lOd. in Canada for a call over a similar distance.

I have mentioned that, unless these revised charges are introduced, the Postal Department will record a loss of at least £8,000,000 for 1950-51. This is not due in any way to lack of careful and wise management. Since assuming office as the Postmaster-General, I have reviewed all main aspects of the department’s operations and I am satisfied that the administration is sparing no effort to reduce expenditure to the lowest possible level consistent with the provision of adequate services to the public and to use all modern aids, as well as to streamline procedures. The plain fact is that the increased expenditure to which I have referred is almost wholly due to inescapable extra costs that result from causes over which the Postal Department has no control. The situation that faces the Postal Department in Australia does not differ in any marked degree from that which confronts postal, telegraph and telephone administrations abroad which have met heavy losses by substantially increasing tariffs.

The Postal Department’s programme of works to restore and expand the postal, telephone and telegraph services is now in full swing, and this year considerable progress will be made in overtaking the arrears that accumulated during the recent war and early post-war years. For example, during the last six months 46,831 telephones have been installed, compared’ with the 37,263 telephones installed during the corresponding period of last year. The Government has provided appropriately for the continued development of services, and stocks of materials have been built up to enable the department to proceed with expedition and economy in the vital task of catching up with arrears of works and meeting the needs of the community for its services. The Government is solidly behind the controlling officers of the department in their aim to supply adequate and efficient services as rapidly as possible. I remind honorable members that the Postal Department not only provides postal, telegraph and telephone facilities, but also carries out a wide variety of services for other departments. In its commercial accounts the department takes credit for the value of these services, and through its agency they are performed at a lower cost to the Australian taxpayer than would be possible if other departments set up special branches to do the work.

Honorable members are fully aware of the fact that the Postal Department has a vital obligation to provide adequate and satisfactory postal and telecommunication services for all settled districts throughout the Commonwealth, and that in performing this national task it must supply and maintain a wide variety of facilities in rural areas on a basis that could not be supported on financial grounds but is fully justified from the standpoint of assisting in the development of our great resources. Take, for instance, mail services. The estimated cost of conveying mails by road during the current financial year will exceed £1,500,000, whereas the expense of despatching mails by rail will be less than £900,000. As more than 90 per cent, of the population lives in towns on the Australian railway systems, the unit cost of transporting mail to rural localities by road is at least twenty times as great as the cost of conveyance by rail, and, obviously, the expense is very much in excess of the revenue that the department receives.

As a further example of the progressive and realistic policy that has been adopted by the department, I refer to the generous conditions under which telephone services are provided to country residents. Although the capital value of the plant required to install a subscriber’s service now exceeds £100,’ and the annual charges involved in respect of maintenance, depreciation and operation have risen tremendously during recent years, the annual rentals are much less than those charged in the metropolitan networks and large country cities and townships. Furthermore, the extra mileage charges on lines extending beyond the 2-miles radius of exchanges are much less than would be justified on an economic basis, whilst the hours of service at country exchanges are increased beyond the normal business hours under the same liberal conditions. The Government is convinced that the provision of services in rural areas at rates which, in many instances, are far less than the cost incurred by the department is fully justified as a means of keeping people on the land, avoiding undue centralization and stimulating and maintaining essential primary industries.

Although it must be admitted that, due mainly to abnormal conditions that have arisen from the recent war, the services of the department are lacking in some respects, the need to remedy the deficiencies and . to build up a public communications system that will meet all reasonable demands is fully appreciated by the Government and the administration, which are sparing no efforts to achieve as quickly as possible postal) telephone and telegraph services that will compare favorably with those in any other part of the world.

In view of the facts that I have stated^ honorable members will recognize that the proposed increases of departmental charges aTe unavoidable and that they are very moderate in the light of the additional costs which the department has to meet. Honorable members will also agree that the alternatives to the adoption of the new charges would be to curtail services and maintenance work with consequent detriment to national development and depreciation of valuable public assets, dismiss large numbers of staff, throw an additional burden on taxpayers) or to stimulate the demand for departmental facilities by making them available at rates that would be much lower than those that are justified by the costs incurred or by their value to users.

In conclusion, I urge honorable members to give careful consideration to the bill, which is nonpolitical in character. I know that it will be supported by all honorable members who appreciate the vital need for a national communications service which will provide the adequate and satisfactory facilities that are so essential to the development and welfare of Australia. I again emphasize that the financial return from these proposals will go only a part of the way towards balancing the accounts of the Postal Department for 1950-51. Consideration has not yet been given to the full impact upon the department’s activities of the increase of the basic wageby £1 a week that was recently announced by theCommonwealth Arbitration Court. As I said earlier, I shall be obliged to make a statement on that matter when the department has ascertained the exact effect that that declaration will have in relation to its expenditure.

Debate (on motion by Mr. Calwell) adjourned.

page 1480


Debate resumed from the 12th October (vide page 799), on motion by Mr. Fadden -

That the bill be now read a second time.

Leader of the Opposition · Macquarie

.- The bill provides for the appropriation of money for the payment of war pensions during the remaining two months of the calendar year. As honorable members will have plenty of opportunities to discuss war pensions during the debates on the budget and the ‘bill that will be introduced for the purpose of increasing the rates of pension, the Opposition does not propose to delay this measure. I assume that it provides for the increases that the Government contemplates.

Mr Fadden:

– That is so.


– In the circumstances, the Opposition will reserve any comments that it may wish to make upon the subject of war pensions for a later occasion so that the Government may secure the desired appropriation without delay.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1480


BUDGET 1950-51

In Committee of Supply: Consideration resumed from the 25th October (vide page 1390), on motion by Mr. Fadden -

That the first item in the Estimates under Division No. 1 - The Senate - namely, “Salaries and allowances, £13,900”, be agreed to.

New England

– The budget reflects the great difficulties of the period through which not only Australia but also other countries throughout the world are now passing. The main problems confronting the people of Australia, and through them the Government and particularly the Treasurer (Mr. Fadden), relate first to the development of Australia, secondly to the defence of Australia, thirdly to the peopling of Australia by means of immigration, and fourthly to the reconciliation of the solutions of the first three problems with an attack upon the rising living and general costs in the community. Those problems provide the background for our discussion of the budget, and any attempt to disregard them must necessarily involve an utterly unrealistic attitude to our responsibilities. Various methods have been proposed for the reconciliation of the first three tasks that I have mentioned with the job of restraining increasing costs. They have ranged from the imposition of confiscatory taxes and the appreciation of the Australian currency to a slowing down of our efforts to develop, defend and populate the country by means of immigration. I shall discuss those suggestions as briefly as possible.

The Government has decided not to appreciate the Australian £1. That decision has been criticized rather strongly in certain quarters. Is the Government’s policy or unwise? Would appreciation, for instance, reduce the cost of living? Honorable members must answer that question. I admit that the proposal to appreciate our currency has some merit, but I do not think that appreciation could have a very favorable effect upon the high cost of living. I shall state the reasons that have influenced me in forming that opinion. My belief is that appreciation of the currency would inflict serious financial losses upon primary producers, would endanger the stability of our great secondary industries, would imperil our immigration policy, and almost certainly would cause serious damage to the structure of public finance. It could have no really effective impact upon the cost of living for the very sound reason that the true causes of high costs lie within Australia and are not external. If high costs were caused by external factors, the Government would ‘be obliged to adopt a policy that would have its impact upon those factors. However, I propose to show that the overwhelming balance of evidence proves that the cost of living depends mainly upon internal factors. I refer honorable members to the annual report of the Commonwealth Bank of Australia in which, after a review of various factors that affect the cost of living, production and so forth, the following significant statement appears : -

However, the cost of imports has only a com- iii ratiively small direct effect on items included in the cost of living index and hence on wage costs, and, after allowing for the effect, on Australian costs, of higher prices for exportable products like wool, it is still necessary to look further for an explanation of the continued increase in prices and costs generally.

The significance of that position is that neither the cost of imports nor the income that is derived from the sale abroad of primary products, even the much maligned wool, is the basic reason for the rising cost of living. That statement in the report of the Commonwealth Bank is one of the most significant that could possibly be made as a part of an impartial survey of the factors that affect the cost of living in the Australian community.

To follow up my remark upon that matter, I invite honorable members to examine some statistics regarding factory production in this country in 1948-49, and certain allied factors that bear upon what I have said. The. gross value, of; factory production in . that . year was– £1,425,000,000. The figure for the . last1 financial year was even greater than that, amount. Income from exports in-1948-49i amounted to £615,000,000, and the in*,terest on the public debt payable in Australia was £72,300,000. Each of those amounts is a factor within Australia that influences the co3t of living, and we must direct our attention to them before we light-heartedly agree with the opinion that it can be reduced by external action.It is well that we should first examine our own household.

I shall now tell the other half of the story, which is about the external factors. In 1948-49, Australia imported goods to the value of £535,000,000, and the interest payment on our overseas indebtedness was £12,300,000, making a total . of £547,300,000, compared with the sum- of the three internal factors, £2,112,300,000. Even if that external factor could be’’ reduced by 20 per cent., the result would not, in my opinion, produce a reduction of £109,400,000 and make an appreciable impact upon our economy. A great disproportion exists between the internal and the external factors, and it is not indicated that the revaluation of the Australian £1 would materially assist to reduce the cost of living in this country.. On the contrary, such action would possibly have a markedly adverse effect. I admit that the figures that I have cited are only approximate. I do not contend that they are correct to the last penny, but statistical accuracy is always a matter of doubt, even when experts work on the calculations. However, the general statements are substantially correct. In order to obtain a problematical saving of £109,000,000 by appreciating the £1, we should jeopardize the prosperity of industries in this country which are producing goods and commodities to the value of £2,040,000,000 per annum. Australia purchased £280,000,000 worth of goods from Great Britain in 1949-50. Would that country reduce the value of its sales to us by £56,000,000 per annum if this Government were to appreciate the £1? I venture to say that British exporters calculate their costs upon what they can obtain by the present rate, and shipping freights and many other charges would almost immediately be readjusted to reduce the advantage that we should expect to obtain from revaluation. During the last financial year, Australia imported £73,000,000 worth of motor vehicles. It would appear that the revaluation of the £1 would effect a saving of £14,600,000 on that item, but that would not be achieved, because a considerable proportion of those vehicles were imported from the United States of America. Is it suggested that American exporters would cheerfully accept the effects of revaluation of the £1? I do :not believe that they would. They would immediately begin to re-adjust their prices for the purpose of reducing the advantage that the importer would expect to gain from the appreciation of the £1. All honorable members are aware of the developments that followed the devaluation of the Australian £1 by the Chifley Government. Australia gained practically no advantage from that decision, because exporters to Australia immediately adjusted their costs in order that their rake-off would not be affected.

I now wish to discuss the prime factors in the cost of Jiving. If those factors are represented by imports, my argument must be seriously weakened. But if they are to be found within Australia, my argument must be strengthened. The prime factors in the cost of living are food, clothing, light, heat, housing and furniture. To what degree will action that is taken to reduce our external costs materially reduce the costs of those internal factors? First, I shall examine the position in regard to food. That the Australian consumer receives the cheapest food in the world to-day is evident from information that I have obtained from certain tables supplied to me by the Department of Commerce and Agriculture. The wholesale price of butter, which i«i paid to the producer in Australia, is 215s. lOd. per cwt., plus a subsidy of 101s. 9d., making a total of 317s. 7d. per cwt. The United Kingdom contract price is 313s. 10 1/2 d. per cwt., on a sterling basis, and the world price is 450s. per cwt. Those people who airily say that the Australian rate of exchange should be unpegged do not appear to realize the. effect that such a policy would have on living costa in Australia. If the £1 were revalued, and if the subsidy on butter were substantially increased so that the consumer would pay approximately 383s. per cwt. - the difference between the Australian price and the world price - the taxpayer would quickly realize his present “indebtedness to the dairying industry The wholesale price of cheese in Australia is 130s. 8d. per cwt., plus a subsidy of 56s. per cwt ., making the price to the consumer 180s. Sd. per cwt. The contract price with the United Kingdom is 175s. per cwt., whilst the world price is 200s. per cwt. The wholesale price of eggs in Australia is 3s. a dozen, and the United Kingdom contract price is 2s. 7d. a dozen. The world price is not cited. When I was in our island territories recently, eggs were selling at 6d. each. Egg production makes a useful contribution to the Australian economy, and that industry would be completely smashed if it were deprived of the advantage that it now derives from the exchange rate. If that protection were withdrawn, thousands of small poultry-farmers - thrifty, honest, hardworking people - would require the assistance of a substantial subsidy to enable them to remain in the industry.

Australia gets its beef at from 8$& to 9$d. per lb., and no subsidy is payable in respect of that commodity. The Australian contract price with the United Kingdom is 8£d. per lb., and the world price in indicated by a question mark. The prices are undoubtedly much higher than we pay for beef in Australia, and range up to 4s., and 5s. per lb. The price charged for lamb in Australia varies from ls. 3d. to ls. 6d. per lb., but lamb is made available to Great Britain at 11 3/4 d. per lb. under a contract with the United Kingdom which provides that payment shall be made in sterling. It is clear, therefore, that the local price of meat would not be affected by a revaluation of the currency. The free price for lamb on the world’s market is from 2s. 3d. to 2s. 6d. per lb., so honorable members will realize the loss entailed to the meat industry in supplying the local markets. Wheat is sold on the Australian market for 6s. 8d. a bushel, but if it is sold overseas, under the International Wheat Agreement, it realizes from 15s. 3d. to 16s. Id. a bushel. If it is sold on markets which are not affected by the international agreement, it realizes 18 s. a bushel and even more. Since 60,000,000 bushels are made available for home consumption, honorable members will realize that the sacrifice made by wheat-growers is very considerable. Calculating the loss on average prices, it has been estimated that it amounts to £30,000,000 annually. A similar state of affairs characterizes the dried fruits industry. The price of almost every variety of dried fruits is lower in Australia than it is abroad. Many thousands of people are engaged in the production of the various foodstuffs that I have mentioned, and the livelihood and happiness of these people and their families depend directly on the continued prosperity of those industries. Furthermore, the people engaged in those industries represent Australians of the best types, and revaluation of the currency, which would destroy the economic advantage at present enjoyed by those industries, would do incalculable harm to our primary producers. Any one who imagines that an appreciation of the currency will reduce the cost of the basic foodstuffs is misinformed, and his calculations are misleading.

I turn now to housing materials, in regard to which there does not seem to be much prospect of a reduction of prices. The greater proportion of housing materials is produced or manufactured in Australia, and the cost of many building materials could not be cheaper. Australia now produces most of the cement used in building, and its price compares very favorably with the price of that produced overseas. We also manufacture the cheapest iron and steel in the world. Housing costs very largely depend upon the prices of bricks, cement, tiles, timber, and other materials, most of which are produced comparatively cheaply in Australia. Practically all our furniture, which is an ancillary of housing, is manufactured in this country from Australian timber.

The principal sources from which power and fuel for light and heat are obtained in this country are coal, water, and to a lesser degree, diesel oil. Almost all the coal consumed is mined in this country, and huge quantities of water are dammed for the generation of hydro electric power. The cost of diesel oil fuel is not high, and it is apparent that no great reduction of the prices of power and fuel, for light and heat can be effected.

I shall deal briefly now. with clothing costs. The greater proportion of the textiles and clothing used in this country is imported. Of course* a large proportion of them are manufactured in Australia from imported raw. materials. In 1946-47’, £53,700j000 worth of textiles and. clothing attire was imported, but only £10,200,000 worth was exported. In other words, in that financial year, Australia expended £43,500,000 on its textile and clothing requirements. It is clear, therefore, that whilst a saving on clothing and textiles might be effected by appreciating our currency, the extent of the saving would not be nearly so great as some people imagine it would be.

I have already pointed out that the wheat-farmers of this country are virtually subsidizing our economy by approximately £30,000,000 a year.” The dairy-farmers are virtually subsidizing the Australian consumers of butter by approximately £8,000,000 a year. The annual loss to graziers on hides sold in Australia, when compared with the overseas price of hides, amounts to approximately £8,500,000. Obviously, an alteration of the present exchange rates would not reduce the cost of footwear, because Australians already enjoy the advantage of being able to purchase the cheapest leather in the world. Some years ago when I was a member of the Parliament of New South Wales I had occasion to investigate the prices of leather and hides, and my investigation revealed that the producers were receiving approximately 9d. per lb. The people of Australia also receive a virtual subsidy from stockraisers of approximately £5,000,000 a year in respect of tallow.

All the fruit and vegetables consumed in this country are grown in Australia. Recently we have heard prolonged outcries from the housewives of the metropolis of Sydney about the scarcity, and the price, of fruit and vegetables. What is the reason for that condition? The explanation lies in the fact that almost all the fruit and vegetables sold in Sydney early in the season come from the warm areas of the north coast of New South

Wale’s. The area between Port Macquarie arid the Queensland border, which produces nearly all our early fruit and vegetables’, was inundated by a succession of floods during the last several months, and it is obvious that no governmental action can circumvent the consequences of such seasonal disturbances.

The brief review that I have given of the basic goods and commodities which really determine the cost of living shows that the revaluation of the currency could not possibly have any material effect on those factors. Consider the attitude adopted by the Australian Labour party towards our present economic difficulties. Labour advocates the reintroduction of prices control as the panacea for all our economic troubles. Of course, from our experience of prices control, we know that it leads only to poverty, scarcity and decreased production. In response to the nation-wide cry of the people for a reduction of the cost of living, all the Labour movement has to offer is the reintroduction of prices control. In other words, it is offering the people, who are crying out for bread, a barren stone. The introduction of prices control would necessitate the re-introduction of wagepegging, profit-pegging and rationing. Who wants rationing ? Is there any member of the Opposition who will advocate the re-introduction of rationing?

Mr Curtin:

– What about pegging profits?


– Let us be quite fair about that proposal. In the first place, it is intimately related to wagepegging and price-fixing. If we reintroduce prices control we shall immediately withdraw from production the services of some thousands of people who will be engaged in all the form-filling routine and checking and cross-checking associated with the cumberous structure that would be needed to enforce any effective system of prices control. Any withdrawal of labour from our present economy, which is suffering gravely from n lack of sufficient labour, would inevitably decrease production and so increase the present costs of goods and services. After all, the principal causes of scarcity are those that arise from the operations of nature, including flood, pestilence and fire, and those that are brought about by the deliberate action of monopolists and others who seek to exploit the community. I do not need to say any more about the monopolists and the exploiters, because any administration that is worthy of office can deal with them.

Another basic cause of the present inadequate production is the deplorable state of our industrial relationships. Although I consider that the introduction of the 40-hour working week must inevitably have had an unfavorable effect upon our economy, I admit at once that the 40- hour working week has never been given a fair trial because people generally have not put .forward their maximum working effort. When we appeal to the Labour movement and the trade unions to cooperate with us in order to stimulate production, which is, after all, the only factor that will increase production and reduce the cost of goods, we are met with the response that the Government should re-introduce prices control. Although the introduction of prices control may be inevitable in circumstances of emergency, it is never a desirable departure from our normal economy. Undoubtedly, the unsatisfactory state of our economy -to-day is due not only to an insufficiency of production but also to a number of other factors. For instance, the nation has decided that if it is to survive it must have a greatly increased population, and to that end we are bringing large numbers of migrants to this country. It is inevitable that those additional people must accentuate the demand for goods and services. In addition, the Government has been compelled to undertake large commitments for the proper defence of this country. That, unfortunately, is unavoidable in the present state of the world ; but does any one seriously suggest that we should reduce the allocation of money or man-power to defence projects?

In conclusion, I consider that the great problem of reducing the present inflated cost of living demands team work on the part of all sections, and of every member of each section, of the community. In the first place, we must eliminate the friction that exists in our industrial relationships, for most of which, undoubtedly, the Communists are responsible. Fortunately, the Government has already directed considerable attention to the Communists, and is now endeavouring to. deal with the purely economic factors that are aggravating our economy. The Government proposes, in this budget, to bring about a balanced economy. Of course, our troubles, which have been accumulating for years, cannot be surmounted in a day. Finally, I appeal, to the people of Australia to realize the magnitude of the difficulties that confront this country, and I appeal to honorable members on both sides of the committee to co-operate with the Government in. solving those difficulties. If any real co-operation is forthcoming, then I am sure that the time spent on this debate will not have been wasted.


Ryan). - Order! The honorable member’s time has expired.


The budget is in many ways a remarkable document. I am sure that the Treasurer (Mr. Fadden) would not wish to have repeated the experiences that he underwent while he was preparing it. After many changes it is now before the committee in a rather ingenious form. I suggest that the budget should be presented to the Parliament in a more simple form than that in which it is customarily presented. I am not an accountant and I have considerable difficulty in understanding it. There are better and more simple ways in which it could be presented so that it would be less intricate than it now is. I also believe that the Parliament should not have to wait twelve months for an opportunity to consider the financial position of the country. Interim reports containing summaries of the nation’s financial position should be presented half-yearly to the Parliament so that it would have information on, and bc able to appreciate, economic trends. The system of a yearly presentation of the budget is not peculiar to the present Government. It has been the tradition of governments since federation to present the budget annually. . Under the present system the budget deals with the financial programme for a period of twelve months, during which time circumstances might arise that are unforeseen when the budget is presented.

The budget contains a summary of estimated receipts and expenditures. Included in the estimated receipts is the sum of £103,000,000 which the Government will collect from the wool sale3 deduction. The Treasurer has taken that amount into account in order to .balance his ‘budget. If it were not for the inclusion in the budget of that sum the Treasurer would be showing an anticipated deficit of about £103,000,000 instead of an estimated surplus of about £500,000. The method that the Treasurer has adopted of showing the estimated proceeds of the wool sales deduction a3 expected receipts, in order to balance his budget, cannot be justified.

Government supporters have made great play of the alleged condition of the social services funds that were bequeathed to the Government by the previous administration. Not many governments in tha history of the Commonwealth have taken office in such favorable circumstances as those that prevailed when the present Government started its term. The Government took over a stable economy. The revenue was buoyant. It has been able, by the use of funds that were accumulated by the previous Government, to bolster its budgetary position.

Mr Anthony:

– But there was no money in those funds.


– Government supporters may claim that there was no money in the funds, and that they consisted only of I 0 U’s. If that is so then the Government is using those I O U’s in order to balance the budget. The Government cannot have it both ways. As a matter of fact it was precisely because that money was in existence that the present Government has been able to provide for the extensive increases of social service payments that it has made.

I turn now to the dollar position and the dollar loan. The budget makes no provision for dealing with the effect that the dollar loan will have upon our economy. It does not provide sums to be devoted to the payment of interest on that loan. This year we shall be paying 4^ per cent, interest, in dollars, on the loan. Provision for that payment should have been made in the budget. The Government has decided that the best means of developing the economy of this country is that of borrowing. Government supporters who have spoken in defence of that policy have dealt with the advantages that we shall reap from the dollar loan, which will assist in the development of this country. They have failed to point out the possible effects of the loan on our future. I recall that in the period from 1920 to 1929, anti-Labour governments followed precisely the same policy of borrowing, and finished up by busting our economy. The same thing may happen again. We are not able to meet our dollar commitments to-day, so how shall we be able to meet them after we have saddled ourselves with an annual interest burden of 3,250,000 dollars on this loan? The loan will enable capital equipment for development to be imported, but it will not directly contribute one cent to our dollar earnings. In support of the Government’s attitude to dollar borrowing honorable members opposite have stated that if we can get dollars into the country we shall be able to compete to a greater degree in dollar markets. On the contrary, that will not be the case, because in the first place America will not permit unbridled competition by us in dollar markets. What could happen is that we might be able to compete more effectively in sterling markets. It is just too silly to think that if we develop this country to a stage where it oan compete effectively, not only with America, but also in the United Kingdom’s dollar market, those two countries will stand aside and let us continue to do so without hindrance. If we reached a stage of productive efficiency that would (suable us to compete with American produck on a cost basis, then, believe me, America would not allow that position to remain unchanged. It would take steps to see that its markets were not undermined by Australian competition, as it has done in the past in similar circumstances, by raising its tariff barriers.

I consider, therefore, that the contention that the dollar loan will enable us to earn more dollars is erroneous, and will not be proved sound in practice. Honorable members opposite seem to believe that because we shall be able to import more capital equipment through the means of the dollar loan, all our problems will be solved by the consequent increase of production. About twenty years ago we. heard that same story, but the difference then was that we were competing in a sterling market, whereas now we are trying to compete in a dollar market. Notwithstanding the fact that up to 1929 we borrowed so extensively that borrowing by the Commonwealth and the States together reached a point where it was necessary to impose controls, we had practically unlimited sterling receipts in the form of loans, and that our production was sufficient to meet our own needs, one of our greatest problems, when the crash came in 1930, was to meet our overseas sterling commitments. The necessity to pay interest on sterling loans was a factor that contributed to the retardation of our development. It is possible that that position will recur as a result of the recent dollar loan.

Nobody knows for how long that position would last. It might last for years. As everybody knows, such conditions occur in cycles. They have a habit of repeating themselves in a more intensified form. If the lessons of history are reliable, then there will be another cycle similar to that which affected us in 1930. I do not know when that will happen. If it were not to occur, then we could not trust the lessons of history. Should it happen as a result of this dollar loan one of the problems confronting us will be that of meeting our interest commitments. I have pointed out repeatedly that it is almost impossible for us to break into the dollar markets. This loan will not assist us in any way to do so, and I cannot subscribe to the idea that has been promulgated in this Parliament that we shall gain greatly from the loan. The terms of the loan leave a lot to be desired. The honorable member for Watson (Mr. Curtin) said last night that America was lending money interest free to Japan. A few years ago America lent Britain money at 2 per cent, interest, yet now we are asked to pay 3^ per cent., plus 1 per cent, commission in the first year. After the first year we shall pay 3£ per cent. I do not consider that this country has made a good bargain. As I have said before, the problem of finding dollars is fraught with difficulty, and if this loan has the effect that

Government supporters have said it will have, that result will be entirely contrary to the teachings of history.

Sitting suspended from12.45 to 2.15 p.m.


– At the suspension of the sitting I was discussing the subject of loans. There are four Australian loans falling due in New York, the interest rate on which varies from 3¼ per cent. to 5 per cent. This loan has been secured at the same rate as loans that were obtained in New York twenty years ago.

Mr Cramer:

– That is not so.


– I suggest that the honorable member for Bennelong (Mr. Cramer) look at the table of loans. If he does so he will find that my statement of the position is accurate. I have before me the table of loans raised in New York and the rates of interest-

Mr Cramer:

– But those loans were not raised twenty years ago.


– They were raised up to twenty years ago. They were raised before the Loan Council came into operation. A number of loans due in New York were raised at interest rates lower than 3¼ per cent. If the honorable member can refute that statement he will have refuted my contention that the Government has obtained this loan on precisely the same terms as applied to loans that were raised over twenty years ago. The Government has obtained this loan on no better terms than it could have got twenty years ago, notwithstanding the fact that interest rates throughout the world are supposed to have been considerably reduced since then. This loan will be a cause of serious inconvenience to Australia in years to come. At the moment, the Government is budgeting for a deficit of 20,000,000 dollars annually. Past deficits have been financed from the Empire pool. Australia was compelled as a result of the change that was made several years ago in the relation of sterling to dollars,to reduce its dollar expenditure from approximately 70,000,000 dollars to 50,000,000 dollars. Tinder existing conditions, Australia is incurring an annual debt of 20,000,000 dollars. It has been suggested that this loan will be the means of enabling Australia to earn dollars to meet its dollar liability. That will not be the case because it will be impossible for this country to earn dollars. It is the responsibility of the Government to provide not only for the present but also for the future. “Whilst this loan may be of some temporary value it will be a grievous burden in the future. The Government has mortgaged the future of this country and the temporary advantage which it may gain will be cancelled out in the future because it will not be able to meet dollar commitments unless there are some abnormal developments.

The Estimates make provision for approximately £103,000,000 as wool deductions. That proposal amounts in effect to a forced loan. The people who have objected to it have a legitimate grievance. At the moment, they are paying7½ per cent. into a wool stabilization scheme. It is now proposed that they should pay an additional 20 per cent. so that they are being taxed at the rate of approximately 27½ per cent.


– They are not.


– They are. For the current year, wool-growers will have their income reduced by 27½ per cent. Honorable members opposite may say what they will of this proposal, but it represents a forced loan. If it is equitable for the Government to discriminate in this matter there are other sections of the community who may well be affected in the same way in the future. In singling out this section of the community the Government has set a precedent which it may regret later on.

The budget is an ingenuous document. It seems to me to be the work of a surrealist. The longer one looks at it the less sense it makes. It will be impossible for this country to achieve any degree of stability, due to the ingenuous methods that have been used by the Treasurer. If the effect of his methods of finance are not felt in the next twelve months they will undoubtedly be felt in years to come. By virtue of the fact that he has included in his budget this wool tax of £103,000,000-

Mr Turnbull:

– It is not a tax.


– Whatever it is, it has been used by the Treasurer to balance. his budget. If the Treasurer had not included this £103,000,000 in his budget he would have been short ‘of that amount. The Treasurer has shown a surplus of approximately £500,000, but if that £103,000,000 “had been excluded from the budget he would have shown a heavy deficit. The attitude of the Government is fraught with danger and difficulty for (this country. “We have experienced what has happened when Australia has embarked, upon a policy of borrowing. Years ago this country borrowed almost up to the hilt in the sterling area, and when the crash came -it was not in a position to meet its sterling liabilities, notwithstanding the fact that it had an abundance of production and a surplus of goods. If a similar position occurs again it will not be able to meet its dollar liabilities. The fact that Australia was not able to meet its sterling commitments accentuated the effect of the depression in this country. Unless this Government can prove that the economic cycles that characterize capitalism have disappeared it must show that this country will not have commitments which it will not be able to meet.

The Government seems to imagine that the importation of capital equipment will enable industry to produce goods which will earn dollars. I submit that not one item of imported capital equipment will earn an appreciable number of dollars for Australia. The use of substantial additional capital equipment might enable Australia to sell goods iri the sterling markets, but it will not enable us to penetrate the dollar areas. It is ridiculous to think that the United States of America will supply dollars to enable Australia to cut the dollar market away from Americans who hold it now. The Government has not shown how we are going to earn dollars. “Wool and wheat are our greatest dollar earners. It is ridiculous to suggest that we should export more wool to the United States of America because the United States of America itself determines the amount of wool that it will take from Australia. Yet, unless we can boost the production of wheat and wool there will be no chance of our overcoming the dollar deficit. In what other field’ can this country compete in the dollar market with other countries? Can we compete in dollar areas with Great Britain with its huge industrial potential? Will America forgo its present markets in hard currency areas in order to enable Australia to enter them ? “We must look to the possibility of developing trade in the soft currency areas. While this loan may have some immediate advantage, in the long run it will be a burden and will not result in any substantial contribution to the development of this country.

A government has the responsibility of taking into consideration the future as well as the present. The last Government would not embark on the policy that this ‘ Government is now pursuing. It could have obtained the same accommodation that this Government is obtaining but it refused to do so because it considered that it was responsible for the future of the nation as well as for the present.

The DEPUTY CHAIRMAN”. - Order ! The honorable member’s time has expired.


.- The honorable member for Martin (Mr. O’Connor) has asked why no provision has been made in the budget for the payment of interest on the recently acquired dollar loan. The reason is that the effective date of the loan has not been decided and, until it is fixed, no withdrawals can be made. Interest is only payable on the amount drawn and it is payable over a period of six months. Therefore, if the effective date is after the 31st December .the interest for the ensuing six months will not come into this budget. If, on the other hand, it is before the 31st December, there will be a small amount of interest but, because the amount withdrawn will be small, no provision has been made for it in the budget. We believe that most of the interest will have to be paid next year. The honorable member also said that this loan would not assist us in any way. It is very hard to follow the honorable member’s reasoning on that point. It is hard to believe that the importation of essential equipment will not benefit us. The dollar loan will be used to import tractors, headers and other agricultural plant, as well as coal-mining machinery such as the Joy continuous miner, grab-loaders and other heavy machinery which is at present obtainable only in America. Such machinery will assist to increase the productivity of this country. About £1,000,000 worth of dollars will be spent on the Snowy Mountains hydro-electric scheme. If dollars were not available for this loan, work on that scheme would be greatly retarded, or it possibly could not be carried on at all.

The Minister for National Development (Mr. Casey), very early in his term of office, introduced into Australia. 96 of the largest earth-moving machines available anywhere in the world. They were the T.D.24 type of tractors. Twenty of those were set to work in the Snowy Mountains area. The purchase of those machines was made possible by an arrangement by the Minister which avoided the use of dollars. Still more dollars will be required if the scheme is to come into operation as quickly as is desired. Speed is of the essence of the contract, in that project. It is no use to have a scheme which will produce power in 35 years. Power is needed in Australia now. The Minister for National Development has also taken active steps to speed up the work on the project. Men engaged there now work 48 hours a week, and are paid overtime for the time worked in excess of 40 hours. That is for the purpose of getting our muchneeded electric power as quickly as possible. As a result of re-organization it is expected that within four years the first block of power will become available from the scheme. This will comprise 60,000 horse-power. Two years later a further 120,000 horse-power will become available. At that time tha harnessed water power will save 250,000 tons of black coal each year. The scheme is expected to produce finally about 3,500,000 horse-power. If this country is to be developed it is essential that that project should be pressed to a speedy and satisfactory conclusion. It cannot be so expedited unless we have dollars to purchase machinery for it. Optimists believe that fifteen years will pass, and the worst pessimists estimate that 25 years will elapse before the scheme will be completed. Therefore, we can expect it to be finished within about twenty years. In addition to the power produced, about 2,000,000 acre-feet of water will become available for irrigation along the banks of the Murray and Mumimbidgee rivers. To say in the light of those prospects that the dollar loan is not of much use is merely to make an absurd statement.

The honorable member for Martin mentioned what he called the “wool tax “. There is no wool tax in .existence, nor is any contemplated. What is proposed is a prepayment of taxes. It can be called, as the Leader of the Opposition (Mr. Chifley) has said, a forced loan, because under the proposal the wool-growers will have to pay their income taxes probably a year ahead of the time When they would normally pay them. Let us consider how the small wool-grower will be affected by the proposal. A man with 150 sheep would shear about five bales of wool. He would receive £200 a bale, so that his gross return would be about £1,000. About five years ago he would have received £150. Out of that £1,000 he will have to pay two levies, a 7-J per cent, levy and a 20 per cent. levy. The TJ per cent, levy has already been considered in this chamber, and it has been decided that a vote will be taken of all wool-growers to ascertain whether they desire such a scheme.

Arguments have been put forward on both sides. It has been said that this levy is an insurance against bad times and that when a stabilization fund of £50,000,000 has been accumulated, backed by a government guarantee, it will be possible to ensure that wool prices do not again drop to the disastrous levels to which they have sunk in the past. The arguments against the scheme are that it represents government interference, and will require a large number of people to operate it who will not be engaged in doing anything useful for a considerable time. Many wool-growers feel that they would prefer to stand on their own feet. They have always done so in the past and desire to continue to do so. The per cent, levy proposal is something upon, which every wool-grower will be able to vote. If the wool-growers accept it, well and good; if they reject it their money will be paid back immediately. The 20 per cent, scheme is one under which the wool-grower will pay income tax in advance and receive a credit. A man who receives £1,000 for his wool will have £200 deducted, for which he will be given a credit. He will use that credit to pay his income tax when his assessment is issued. If that £200 were left in his own hands, he would have it for only about twelve months, and it is most unlikely that he would be able to earn more than 2 per cent, interest with it. Therefore he will lose about £4 during the year if it is taken as a credit against his income tax. If he is working on an overdraft he may have a mortgage upon which he is paying 4^ per cent., so that he will lose £8 10s. gross if he pays the £200 to the Taxation Branch. The £8 10s. would be a deduction from income tax and actually his loss would work out again to about £4. I do not think that there is anything unreasonable in asking a farmer to forgo £4 out of his £1,000 wool cheque.


– Then why are the wool-growers protesting?


– They are objecting mainly because they do not know the full details of the scheme. Something has been said about hardship, and it has been stated that there is no hardship clause in the bill, but the Treasurer (Mr. Fadden) has stated that provision has been made to meet cases of hardship among wool-growers. I direct the attention of honorable members to clause 11 of the measure, which reads -

Where the Commissioner receives from a producer a wool deduction certificate and is satisfied that the producer has suffered such losses by reason of flood, drought or other adverse seasonal conditions, or otherwise, that the producer would suffer serious hardship in paying an amount of income tax or provisional tax payable by him but in respect of which he is not entitled under the last preceding section to a credit in respect of that certificate, the Commissioner may credit, in payment or in part payment of that income tax or provisional tax, an amount not exceeding the amount of that certificate.

There is a further provision in clause 12 under which a producer who is not satisfied with the decision of the Commissioner may appeal to the Land Valuation Board established under the Land Tax

Assessment Act 1910-1949. Therefore, it is quite certain that cases of hardship have been provided for.

An important matter raised during the debate is that although the Opposition has been particularly critical-

The DEPUTY CHAIRMAN.- Order ! There is far too much conversation in the chamber.


– The Opposition has not put forward anything in the way of constructive criticism of the budget.

The DEPUTY CHAIRMAN.- Order ! The honorable member for Watson (Mr. Curtin) is conversing too loudly.


– Honorable members opposite have put nothing forward as an alternative to the Government’s proposals except prices control. They know as well as everybody else that prices control with all its concomitants > in the way of wage-pegging and direction of man-power would be quite unacceptable to the people in peace time. They have put nothing forward to assist us to improve the budget in any way by making a better arrangement for dealing with the period of inflation through which we are passing. The Leader of the Opposition (Mr. Chifley) was very critical of the Government’s failure to reduce expenditure. Does he believe that we should reduce our expenditure on defence, which is estimated to co9t £83,000,000, or on building up a stockpile of essential stores upon which £50,000,000 is to be expended, or that we should not pay child endowment for the first child? Does he believe that we do not need more and improved postal facilities or that a free medicine scheme should not have been introduced? Doe? he believe that we should not increase pensions by the large amount which was said by the Treasurer to be the largest increase in pensions that has ever taken place? It is all very well to criticize the Government, but the Opposition has not attempted to point out how the Government’s actions could have been improved.


– It would not be hard to do that.


– I am asking for some constructive criticism, but none has yet been forthcoming from the Opposition during this debate which has been proceeding for a long time. The previous Government handed out to the States a very meagre amount of money for road construction and maintenance. The roads of this country are in a deplorable state at the present time.

Mr Thompson:

– The Minister for National Development has said that the States could not spend the money which was made available to them by the previous Government.


– I have consulted the engineer of the shire in which I reside and he has informed me that he could have spent considerably more had it been forthcoming.

Mr Casey:

– If the honorable member for Port Adelaide (Mr. Thompson) charges the States with inability to spend the money allocated to them he will find that they will give him a very different answer from that which he might expect.

Mr Thompson:

– The money allocated by the Australian Government for road maintenance was not spent by the States.


– Roads are in a deplorable condition and have been made worse by the widespread floods which have occurred this year. As a modern, progressive country, we used to pride ourselves upon the state of our roads, particularly the Hume Highway, which was was one of the best roads in Australia. This fine road has now deteriorated into a string of pot-holes, and near Sydney it has at times been completely impassable. In those circumstances, the Government must provide additional finance to State governments and. local government authorities for the development and maintenance of not only main roads but also access roads. If the Government were now faced with the necessity to move vast quantities of strategic materials over the roads between Melbourne and Sydney few of the vehicles employed in the task would be able to complete the journey within a week, whilst many of them would .break down completely.

Mr Thompson:

– The recent heavy rains have damaged those roads.


– That _ is so; but, principally, for want of repair, they are not capable of carrying present meter traffic which is rapidly increasing because the railways of New South Wales cannot handle a large proportion of the goods that are offering to them. We are approaching a stage when road transport will outstrip the rail transport, which is coming obsolete. For instance, the New South Wales railways will not accept any goods for delivery outside a radius of 50 miles.

Mr Curtin:

– Tell us something about the pot-holes in the workers’ wages.


– The Government is also incurring greatly increased expenditure under its immigration scheme. Surely, no honorable member would suggest that for the sake of saving a few million pounds we should curtail that scheme. Under it we are bringing large numbers of people to Australia who will contribute much to the development of our resources. Provided that the Government presses on with its immigration plans, we may witness in this country a. parallel to the development that took place in the United States of America in the ‘90’s, which was a groat factor in helping that country to become a leading nation to-day. I have heard considerable criticism of some of the classes of migrants that are being brought here. It is said that many of them will not prove to be satisfactory. However, even should a few migrants fail to ‘become good Australian citizens we have every reason for hoping that their children will do so. I urge the Minister for Immigration (Mr. Holt) to apply the immigration law a little more strictly than it is being applied at present. Although all migrants who are brought out under the Government scheme sign an agreement to engage for a period of two years in work to which the Government assigns them, we know that in many instances migrants have had as many as six jobs within a period of a few months, and that some of them have simply laughed in the face of departmental officials when they have been directed to certain industries. The Government should not hesitate to send back to Europe any migrants who are proved to be unsuitable. However, the great body of migrants are making a very valuable contribution to the development of this country. Recently, when I inspected some large industries at Wagga I was amazed to find so many migrants engaged in them, and those in control of those industries informed me that they would not have been able to carry on had it not been for the migrant labour that had been made available to them.

A few minutes ago the honorable member for Watson made an interjection that had reference to the problem of putting value back into the £1. The honorable member is aware of the reasons for rising posts. One is that the purchasing power of the community is excessive in relation to the supply of goods that are available. The Government is taking every action in its power to remedy that position. First, it is importing plant and goods that are urgently required by industry; and secondly, it is implementing a plan to increase local production. Whilst in 1949 we imported £139,000 worth of coal, last year we imported coal to the value of £438,000, or an increase in value of oyer 100 per cent., and, last year we imported £22,665,000 worth of iron and steel compared with imports valued at £9,335,000 in 1949. In addition, the Government has reduced import duty and sales tax on an extensive range of articles including prefabricated structures. The Prime Minister, in the series of broadcasts that he made recently, fully explained the Government’s plan to step up production generally. Every one realizes that underproduction of coal is at the root of this problem. The Government has also negotiated the dollar loan which will be used for the purpose of procuring plant and machinery and of mechanizing coal mines. Recently, the Parliament passed the Communist Party Dissolution Bill which should have the effect of reducing industrial unrest. The Government does not expect by that means to achieve that objective immediately. Indeed, it is most probable that the first .reaction to that measure will be increased unrest until the core of communism is removed from our essential industries.

The Bureau of Mineral Resources has done an enormous amount of exploratory work. In my electorate, thanks to the work of that body, what was at first thought to be a minor coal-field has been proved to be 600 square miles in area whilst drilling has disclosed a seam 62 feet in width at a depth of 200 feet! That is the only large deposit of coal in New South Wales that is conveniently situated to serve the requirements of Victoria. I do not know whether it, can better be developed by the open cut method than by deep mining. However, the deposit is so situated that the coal can be fed directly to the Victorian railways, which can convey it to any part of that .State, or it can be transported by barge on the Murray River to power houses at Mildura and Swan Hill and to meet the needs of many important industries along the Murray Valley that are now starved for coal. Whilst that coal is rated at only 10,000 British thermal units compared with a rating of 12,000 British thermal units of Maitland coal, it is of better quality than other coal found in Victoria with the exception of Wonthaggi coal. However, the Wonthaggi seam is of limited dimensions.


– Why has not the seam to which the honorable member refers been opened up?


– It would have been opened up by now, had it been situated anywhere else but in New South Wales. I could mention many other measures that the Government is taking with the object of increasing production, but I wish to deal briefly with a matter that is a bone of contention in the Parliament. I refer to the introduction of systems of incentive payments and profit sharing in industry generally. As the Government has no legislative power to implement such systems, the initiative in this matter must rest with the employers and employees. The introduction of such systems will depend upon the degree to which the workers are prepared to cooperate. Such schemes would contribute greatly towards increasing production. Ab my time has nearly expired, I shall conclude by repeating that the budget is designed to curb inflation by increasing production by reducing the purchasing power of the community and increasing the limited supplies of goods that can bc produced under present conditions.


.- The honorable member for Farrer (Mr. Fairbairn) has just made an amazing apology for the budget. Every one anticipated that the Government would introduce proposals to eliminate all forms of controls and would severely prune government expenditure, but in spite of the promises that the present Government parties made at the last general election, nothing contained in the budget is designed to achieve those objectives. On the contrary the Treasurer (Mr. Fadden)- in his budget speech said -

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 Capital Issues control.

I realize, of course, that the Prime Minister (Mr. Menzies), in the numerous broadcasts that he has made in recent months has, rendered more difficult the Treasurer’s task in framing the budget. I recall that on a previous occasion when the Treasurer wa3 Prime Minister he was virtually forced out of office as the result of criticism that was levelled against him by the present Prime Minister. Perhaps I can best convey the general reaction of the community to recent speeches that were made by the Prime Minister by quoting press editorials. The following editorial was published under the heading “ Better off than ever - What’s all this hard times and inflation talk?”: -

Capital Issues Board: Proposal to revive this comes as a shock. Control of capital issues is a blow against initiative and free enterprise. Any man or woman in Australia should be allowed to start any enterprise he or she likes. If it is not a success they lose their money; but it was free enterprise that built the -primary and secondary industries of Australia without any Capital Issues control. Further, there are more brains in free enterprises than among the bureaucratic boards that are set up to strangle them. In any case, legally the suggestion does not mean anything, for it is invalid. Mr. Menzies should ignore it. . . .

Discouraging workers in unnecessary .or luxury trades: This rather savors of industrial conscription. Who is going to decide what are unnecessary and luxury trades ? Any government seeking to direct Australians in industry will find that Australians will not stand for it.

Less Government spending: Every one will agree with this. Curtail Government spending by all means, but do it and don’t talk about it.

Government finances to be conducted to avoid inflationary budgets and to avoid running into debt, will receive wide commendation. It is something that the people desire with all sincerity.

But the budget gives no promise of any reduction cif expenditure! Commonwealth revenue from individuals will increase this year from last year’s total of £95,500,000 to £157,000,000. The over-all increase of revenue for the year will exceed £172,000,000. These betrayals of the policy that was announced during the election campaign will -require a greatdeal of careful explanation when the Government and its supporters next face the voters, an occasion which, I hope, will not be long postponed.

The Government took office during the period of greatest financial prosperity in Australia’s history, and its persistent propaganda about the danger of inflation is largely humbug. All citizens should share in this prosperity. Hysteria should be discouraged and the people should be informed that there is no immediate risk of a depression. The Government’s policy was viciously criticized by the six State Premiers, both Labour and anti-Labour,’ at the recent conference of Commonwealth and State Ministers. The attitude of the Prime Minister and the Treasurer led to discord throughout the discussions at that conference. The curtailment of expenditure by the .States, of which the Government talks so freely, will lead to the obstruction of progress and the curtailment of major developmental works that are of the greatest, importance to the nation as a whole. Home building will be retarded, notwithstanding the Government’s vainglorious promises. The financial restrictions that it has imposed upon the States will hamper the construction of hospitals, the expansion of health services and the construction of muchneeded schools. Water, sewerage and electricity projects will be delayed. Some Premiers have declared that they will budget for deficits during the current financial year. They cannot do otherwise if their States are to prosper. The important work- of municipal councils will be held back because of the shortage of funds that will result from the Government’s restrictive financial policy. Many men of vision and initiative serve the community free of charge on local government bodies throughout Australia. But their efforts will be negatived unless they can obtain funds with which to finance the undertakings that they have planned. One council in the electorate that I represent, which includes the salubrious district of Bondi, has prepared a scheme to make Bondi a tourists’ paradise that will become famous throughout the world. That plan will have to be deferred indefinitely because the council will be financially starved as the result of the implementation of the Government’s policy.

Many of the speeches that have been made in this budget debate have created a false atmosphere. It is true, of course, that most of the nation’s wealth is concentrated in the hands of only a few citizens, a situation that might easily lead to inflationary chaos. However, by means of a more equitable distribution of our wealth, the Government could secure the full co-operation of the community in the task of stabilizing our economy on a permanent basis.

Mr Freeth:

– Does the honorable member favour higher taxation?


– I should have no objection to the levying of higher taxes upon those people whose incomes would enable them to bear the increased load without hardship, or even discomfort. I consider that the Government should give more help to the people who are in need of assistance instead of increasing the salaries of highly placed public servants and judges, some of whom will receive as much as £100 a week when the Government’s proposals are implemented. Some members of our community are expected to live on an income of approximately £130 a year. Most supporters of the Government have no real conception of the conditions under which the masses of the people live. They speak of the magnificent liberties that are enjoyed by Australian citizens and, when members of the Opposition remind them of the sufferings of the unfortunate members of the community, they believe such equality exists under this system that the rich, as well as the poor have freedom to sleep under bridges and to starve if they want to do so. That is a very grim type of humour.

There is a great deal of poverty in our midst to-day as the result of the high cost of living. I plead for the workers with young families and the workers in the age group over 60 years whose sufferings are considerable. A few months ago the Minister for Labour and National Service (Mr. Holt) said that the average working man was then earning about £9 or £10 a week. The Prime Minister also said in a broadcast speech that, in real wages, the workers were receiving on an average about £10 or £11 a week. Those figures apply only in some instances. Many Australians are able to maintain a reasonable standard of comfort because both husbands and wives go out to work and bring money in the home. Wives should not be forced to work in order to help their husbands to keep the wolf from the door. The practice is destructive of family life and no honorable member can look upon it with favour. But many wives are unable to help their husbands because they are obliged to stay at home to look after young children. Such families suffer many hardships and discomforts because of the difficulty of making ends meet on the wages of one worker. Almost daily the newspapers publish accounts of children suffering from hunger because mothers cannot afford to buy sufficient food because of high costs. The cost of living has risen out of all proportion to the average working man’s income. I plead with the Government to give special consideration to the needs of yoting married couples with children and workers over 50 years of age. From my experience in New South Wales with the Department of Labour and National Service, I know of the difficulties that confront elderly workers. According to reports published in the newspapers to-day, over 117,000 jobs are available in Australia and only 394 people are in receipt of the un “inpayment benefit. The, number of unfortunate unemployed people is small, but their plight is serious. The benefit is £1 5s. a week for single men and £2 5.s. a week for married men. It is disgraceful that people should be expected to exist on that miserable pittance when the basic wage is about to be increased to £8 6s. a week.

Men over the age of 55 years have great difficulty in finding employment unless they are in first-class physical condition or have special skills. Employers want only men under the agc of 45 years. The Government ought to do something to lighten the’ burdens of elderly workers. In the United Kingdom recently, a bill was introduced in the House of Commons for the purpose of providing for the rehabilitation and re-establishment of disabled citizens. A project of that sort has considerable merit. I do not suggest that we should adopt any scheme that would encourage employers to secure slow workers’ permits, for that would break down established industrial conditions. However, I consider that it is imperative for industry to employ a percentage of partly disabled and aged workers. Not long ago the Minister for Social Services (Senator Spooner) appealed to pensioners to find jobs for themselves in order to help thu nation. Many people over the age of 65 years are eager to work and would tak, employment if they could find it. The Government should encourage and help them by compelling employers to allot a certain proportion of the jobs in industry to such men and women.

Mr Casey:

– Is the honorable gentleman referring to people who have retired from industry?


– Yes, and to people who are not physically capable of doing laborious work. Employers will not engage such people unless they are forced to do so, and the Government ought to enact legislation for that purpose.

The increase of pensions has been made a feature of this budget. I realize that some pensioners will be happy to receive an additional 7s. 6d. a week, but that amount will be insufficient for their needs in view of the recent increase of the basic wage. The Commonwealth Arbitration Court has increased the basic wage- by fla week, whilst an additional loading of 4s. has been allowed. Yesterday, I asked the Treasurer whether he would be prepared, in view of that increase in the basic wage, to introduce a supplementary budget to provide for an increase of all classes of pension. The right honorable gentleman evaded the principal point in my question by stating that the Government’s financial proposals would be considered by the Parliament this week. Therefore, it appears that age, invalid and widows’ pensions will be increased by only 7s. 6d. a week. In the first week in December, the basic wage in Sydney will be increased to £8 6s. a week, an increase of £2 14s. a week in the last two years. During the same period, the age pension has been increased by only 7s. 6d. a week. All classes of pensioners and the recipients of unemployment and sickness benefits will not be able to meet the higher costs of the necessaries of life that may be expected when the. full impact of the new basic wage is felt on prices.

The Government has appealed to the workers to increase production, and to co-operate generally with it in an endeavour to overcome our economic difficulties. I believe that the workers, if they were relieved of the fear of unemployment in future years, would perform their tasks with greater confidence, and meet the Government’s wishes. I am certain that any government, regardless of its political views, would receive the co-operation of the workers if they considered that they had security of employment. The Leader of the Opposition has stated that the Labour party does not support or protect loafers, profiteers and racketeers. I advise the Government to examine the conditions under which many workers live. If all workers were adequately housed, and were assured of security of employment, there would be confidence in the future and an increase of production. There is a widely held opinion, particularly among Government supporters, that every worker is in a very sound financial position. The people who hold that view will be astonished to find that, despite conditions of full employment and of so-called prosperity, only one Australian in three can afford to take an annual holiday away from his home, and one Australian family in five has never had a holiday. That information has been compiled by the Melbourne Political Research Unit.1 The facts are that, although workers have the benefit of the 40-hour week and are supposed to be receiving high wages, they are not able to take their families on an annual holiday.

The conditions under which some workers live are appalling and disgraceful. In the electorate of Phillip, which I represent, many homes are in such ‘a state of bad repair that almost every roof leaks during wet weather.

Mr Turnbull:

– Whom does the honorable member blame for those conditions?


– The Government is constantly expressing concern about cooperation with the workers, and I am pointing out that many of them are badly boused. If they had better accommodation and amenities with security of employment, they would co-operate with the Government and increase production. The Sydney Sun recently published the following news item under the heading of “ Alderman shocked by dwellings “ : -

Roofs of houses in Pyrmont and other industrial areas are in an appalling condition. Alderman J. C. Carroll said to-day. “ In Pyrmont the roof of practically every house needs repairing “, he added. “ About 75 per cent, of the roofs should be renewed. “ Ceilings of 50 per cent, of these houses arc either down or coming down.”

Alderman Carroll said the position in Ultimo was nearly as bad. “ Since I became an alderman nearly two years ago the roofs of only 10 houses in Pyrmont have been repaired “, said Alderman Carroll.

A few minutes ago, the honorable member for Mallee (Mr. Turnbull) asked by interjection whom I blamed for such conditions. I have the greatest pleasure in informing him that the persons whom he protects in this Parliament ‘are responsible for them. They are causing such a panic among the workers that the Government cannot possibly secure the co-operation for which it asks. It is hypocrisy to speak about co-operation when many workers live under such appalling conditions, and have no confidence in the future. The blame lies with those people who are not co-operating to provide better living conditions for the workers. It is disgraceful that such bad housing conditions should exist in this fair land of ours, which is so wealthy and which should be able to provide all theamenities the workers crave.

I now desire to refer to anomalies in the social services legislation, and I shall make particular reference to war service pensions. I hope that when the Australian Soldiers’ Repatriation Act is being reviewed, anomalies which affect exservice men and women will be rectified. One example of the anomalies which I cite is that civilian pensioners are permitted to receive an income of 30s. a week before their age or invalid pension is affected, whereas persons in receipt of war widows’ pensions or service pensions are permitted to receive additional income of only £1 a week. I understand that such an anomaly has existed for a considerable time, and I hope that it will be rectified without delay.

The DEPUT Y CHAIRMAN. - Order ! The honorable member has exhausted his time.


– The honorable member for Phillip (Mr. Fitzgerald) has made an interesting remark to the effect that Australia is enjoying great prosperity. I hope that I am not misquoting the honorable gentleman, but that was a fair inference to draw from his statement. It is true, and it can be proved, that Australia is enjoying prosperous conditions, but that fact does not make the budget problem any easier. Prosperity is accompanied by all the problems that are caused by high prices and inflationary trends. Therefore, the Treasurer (Mr. Fadden) has been obliged to devote a considerable amount of time and effort in order to produce a budget which, in this year of almost violent change, will bring lasting good to our community. Australia is experiencing the effects of inflationary pressures and high prices. I believe that although the prices of some goods are high at the present time, the real kind of inflation, of which we should be really afraid, has not yet overtaken us. We must guard against it, and take every possible measure to cushion its effects. The Treasurer has had to draft his budget during a period when the prices for the goods that we export are rising considerably and when substantial sums of money are in circulation as a result of war-time financial measures, including loans. Our wool is bringing fantastic prices. The Division of Agricultural Economics has informed me that, at a corresponding time last year, the average price of wool in Australia was approximately 40d. per lb.. At the beginning of this year, it had risen to 80d. per lb., and to-day, it is about 120d. per- lb. That is to say, in twelve months, the average price of wool in Australia hasincreased threefold, and an amount of approximately £300,000,000 has been released into the community. The economists inform us, and their opinion appears to be sound, that high prices are caused when the demand for goods is considerably greater than the supply, or to put it another way when the supply of goods remains static and the quantity of money keeps rising. One Opposition member said last night that, in recent times, prices of many articles have risen by 100 per cent., and he used that figure as au argument in favour of the reintroduction of prices control by the Commonwealth. What are the facts about the fixation of prices? A few hours ago, I obtained from the Commonwealth Statistician some details about the “G” series index, which includes the goods which, the unions agreed in the Commonwealth Arbitration Court, are the necessaries required by the wage-earners.

Mr Ward:

– The unions did not agree to that. The honorable member does not know what he is talking about.


– I have not sa id-

Mr Ward:

– The unions have to accept the “ C “ series index.


– In fact, the index does not include fruit and vegetables. Before the honorable member for East Sydney (Mr. Ward) interjected, I was about to point out that the trade unions agreed that the fluctuations that occur throughout Australia in the prices of fruit and vegetables made it impracticable for an allowance to be made for them in the price index”. I know that at present fruit and vegetables are inordinately expensive. That . is due, of course, to the destruction of fruit and vegetable crops by the recent series of prolonged and disastrous floods in the northern parts of New South Wales. Prices control and food subsidies were discontinued by the Australian Government in September 194S, and during the preceding twelve months prices had increased by 10 per cent. In the first year of prices control by the States, the increase of prices that took place was only 9 per cent. It is clear, therefore, that prices increased less under State control than they did when the National Government was administering prices control. Leaving aside for a moment those who are dependent uponfixed incomes, it is clear that the average wage-earner is -better off by 12 per cent, than he was before the war.

Mr Ward:

– Let the honorable member try to convince an Australian housewife of that.


– The Australian housewife is better off to-day than she was before the war because the increased cost of living is more than balanced by the increased wages which come into her home. Furthermore, the average wage.earner to-day is receiving considerably more than the basic wage and, probably, more than the award rates for his particular occupation. Whilst the real wages of the average man before the war did not often exceed the award rate for his occupation, it is abundantly clear thatmany people are to-day receiving more than their award wages. Full employment also has a direct bearing on the family budget, because it is now possible for a family of three or four people and even adolescent children to receive an income in respect of each person. Many homes to-day have an aggregate income of from £30 to £40 a week, so that they are comparatively well off. I am not speaking at the moment of a married man with a young family, or of a man who cannot obtain proper housing accommodation for his family, because such people are obviously worse off than they were before the war. The fact remains, however, that the majority of people are better off now than they were before the war. In fact, we are experiencing prosperity. Of course, I do not deny that the present economic trend can lead to danger, but I do not think that we should mislead ourselves by imagining that the cost oi living to-day is exaggeratedly high, because in twelve months’ time we may be afflicted by real inflation. To prevent the onset of inflation it is obviously necessary to increase production, but that can only come about if employers and employees do their part.

The Treasurer (Mr. Fadden) is confronted with the problem of combating the approach of inflation, which is just around the corner. He has to provide nearly £100,000,000 for additional expenditure on defence, and approximately £70,000,000 for war gratuity. The war gratuity will be paid in March next year, and we can imagine the inflationary effect that the release of such a large sum in addition to millions for the sale of wool will have upon our economy. The Government has also been called upon to provide additional money for the States and, as a consequence, a strained relationship now exists between it and the State governments. The introduction of uniform tax has resulted in the emergence of a competitive spirit between the National Government and the State governments, which is obviously bad for the community. Although the National Government has control of revenue, the State governments control the Loan Council. The Government has asked the States to curtail expenditure, but unless Commonwealth and State relationships improve, the States may carry out their threat to defy the Commonwealth by borrowing excessive money on the loan market. At the last meeting of the Loan Council the States increased very considerably the amount which they are authorized to borrow, and, as a consequence of increased borrowing, more than a further £100,000,000 may be released in the community. I do not know whether the States could expend that money if they borrowed it, but the expenditure by the States of any additional money, and particularly of loan money, will undoubtedly aggravate the present shortage of goods and the general inflationary trend. I understand that the States do not want to revert to the former system of raising their own revenue from taxation, but prefer that the Australian Government should continue to play the odious part of national tax-gatherer. However, I think that a royal commission should be appointed to inquire into and report upon Commonwealth and State financial relationships. Such a commission could determine the proper spheres of the Commonwealth and the State governments in raising and expending money. A continuance of the present unsatisfactory arrangements will endanger our economic, stability.

The matters that I have mentioned touch upon only some of the difficultiesthat confront the Treasurer, who realizes the added danger occasioned to our economy by the influx of some additional hundreds of millions of pounds from the sale of wool. The original proprosal made by the Government to the wool-growers was that a compulsory levy of 7i per cent, should be imposed on all moneys received from the sale of wool. That proposal was made in consequence of the termination of the operations of the Joint Organization, and the leaders of the wool industry agreed to the imposition of that levy. Under that scheme the money deducted from the wool-growers income would remain their property and would be used to finance a wool stabilization scheme to protect their interests in less prosperous times. The next proposal put forward by the Government was that a prepayment of tax of 20 per cent, of the proceeds from the sale of wool should be made by the growers. That proposal would result in the Treasury receiving approximately £100,000,000 twelve months earlier than it would otherwise receive it, but it does not mean that the wool-growers will be treated harshly in comparison with the ordinary taxpayers, as no unfair discrimination is involved in the scheme. All that is required of the wool-growers is that they shall pay their income tax earlier than they would normally pay it, and at a time when they can well afford to do so. In any event, the incomes of wool-growers will be much higher this year than ever before, except in a comparatively few instances, where the wool clips have been spoiled by the floods or by some other exceptional cause. Special provision is made in the scheme to prevent hardship being inflicted upon persons who cannot afford to make a compulsory contribution.

Unfortunately, however, there is a widespread belief in the community that the farmers are subsidized by the Government, that they are always trying to get more from the general pool, and that, in fact, they are grossly unfair to the rest of the community. I know that that feeling is particularly strong in some metropolitan electorates. In a later part of my speech I shall cite some remarks made by Mr. Colin Clark, the Queensland Government Economist, which have, I believe, already been quoted by other honorable members, in order to disprove the contention that the farmers are receiving more than their fair share of the communal wealth and to demonstrate that the consumer is getting a fair deal. Before doing so, however, I point out the very big difference in the home-consumption price of wheat, which is 7s. Id. a bushel, and the overseas price, which is, on the average, approximately 16s. a bushel. The Australian dairying industry also provides butter for local consumption at 2s. 2d. per lb. in most parts of Australia, although the overseas price- is very much in excess of that figure. Whilst it is true that the dairy-farmers receive a government subsidy to enable them to sell butter so cheaply for local consumption, I point out to honorable members that the local price bears no relation whatever, to the price charged for butter in other parts of the world. In the United States of America butter costs as much at 8s. lid. per lb., and in the United Kingdom, it is in extremely short supply. Although Australian butter is sold to the United Kingdom at a lower price than that sold on the markets of the world, it is necessary for the United Kingdom Government to subsidize butter in order to bring its price within the reach of the British people. Because such a variety of nutritious and cheap food is available in Australia we take it for granted that a similar condition obtains in other countries. That is not so. In the United States of America margarine is in general use as a substitute for butter, and the butter ration in the United Kingdom is still only 5 oz. a week for each person.

Mr. Colin Clark, to whom I have previously referred, has made it abundantly clear that the primary producers of this country are more than pulling their weight in the national economic effort, as is shown by the following remark : -

The farm and pastoral population which now numbers only one-sixth of the labour force has increased its product per head by from 25 to 30 per cent, in spite of all the shortages and difficulties with which they are faced.

I have checked that estimate with the Division of Agricultural Economics, whose officials have informed me that the appropriate figure of production more closely approximates to 40 per cent. Mr. Clark continued -

This figure is a remarkable tribute to their hard work, skill, and courage.

Ordinary common sense will tell us that the way to enrich Australia is to attract as much labour and enterprise as possible into our productive farm and pastoral industries, and not into our unproductive manufactures.

We have been strenuously doing the exact opposite - discouraging agriculture by compelling the primary producer to sell his products below world prices, imposing exceptional taxation upon him, and keeping him short of essential supplies, while encouraging manufacture by protection, import licensing, and many other forms of governmental support.

In another article Mr. Clark wrote -

Exports of primary produce now command much better terms of trade on the world market than previously.

Instead of allowing the benefit of this transaction to accrue to the primary .producer, the wage-earner claims part of it for himself by requiring the primary producer to exchange a large part of his ouput for high-priced Australian goods and services, rather than the lower priced goods which he could have obtained on the world market.

I am putting my views before the committee because I consider that the public should be informed about the actual facts. Primary producers, including those engaged in the dairying and wheat industries, have voluntarily imposed stabilization on themselves. They did so for several reasons. They do not like famine prices, because they know that consumers find it difficult to pay high prices and that that fact will lead to a contraction of the market. They wish to have supplies of their products stored away to be released to the market during periods of scarcity. They also wish to assist to keep prices within the means of the consumers. They do not like the glut prices which operate in periods when an enormous volume of goods is thrown on to the market because nature has been particularly bountiful, and when prices fall so that some farmers, whose production might be needed later in famine times, are forced out of production. It will be recalled that in the joint policy speech of the Liberal party and the Australian Country party, the Prime Minister (Mr. Menzies) suggested the establishment of a rural industry tribunal to operate in much the same way as the Tariff Board operates, to adjust the prices of primary products over a period. We should have in operation a scheme administered hy a suitable tribunal to achieve price equilibrium. The operation of such a scheme would be accompanied by many difficulties, but it would be unwise to continue to allow the prices of primary products to be governed by the vagaries of nature. Pood, fire or drought can make prices high, whilst an exceptionally good season can make them low and put many producers out of business. I wish to see proper price equilibrium for primary products, which will not only give the producer a fair return for his labour but will also make goods available to the consumer at reasonable prices. Such equilibrium has been achieved in relation to bread, butter and sugar. I also desire to see careful storage of primary products in good seasons, for release to the markets in bad seasons.

The way in which some people talk about high prices to-day is amazing. Recently I attended a function connected with a blinded soldiers’ organization at which some women were preparing bread and butter for afternoon tea. As soon as they knew who I was they said to me. “ You come from Canberra. Canberra has been putting up the prices of goods “.


– That is correct.


– They apparently believed what the honorable member for Hindmarsh (Mr. Clyde Cameron) has been telling them. They even said that the Prime Minister (Mr. Menzies) had introduced the 40-hour week, which will indicate to honorable members the sort of talk that goes around. When they had cooled down I asked them what the price of bread was, and they said . that they did not know.


– What is it?


– The price of bread is Bid. per 2-lb. loaf, which the honorable member probably does not know. I asked those women, who had been complaining about prices what the price of butter was, and they said they did not know. For the information of the honorable member for Hindmarsh it is 2s. 2£d. per lb in Canberra and 2s. 2d. per lb. in Sydney. The prices of goods such as sugar, tea, eggs and other household commodities are as low in Australia as they are anywhere in the world. Those commodities are produced by primary producers many of whom are owner-farmers who work without the assistance of hired labour. In one part of my electorate there are 1,376 farms on which 2,200 people work. That means that about 1.6 persons work on each farm. That average number includes the farmer, his family and hired hands. Many farms are worked by only one man. Those people are doing their share in the productive effort of this country by working seven days a week. Their work begins at 5 a.m. every day. They are on the job early to produce goods that the honorable member for Hindmarsh and his colleagues find waiting on their doorsteps every morning. Even on Saturdays and Sundays people in the metropolitan area, most of whom do not rise early on those days, find their morning milk on the doorsteps. It is there because dairy farmers work hard, long hours.

There are two good features that have made themselves apparent in recent times. One is the change in the attitude of the trade union movement, which started with the visit of a team of British trade unionists to America to discover the secret of the higher real wages earned by Americans. Figures relating to real wages in America show that Americans have the highest real wage in the world. The real hourly wage in Australia, expressed in terms of the present purchasing power of our money, was 30d. in 189.1 and is now 56d., which is almost double.


– Rubbish!


– In the United States, where the real wage was also about 30d. in 1891, the level is now 109d., which is nearly twice as high as the level of the real wage in Australia. The real wage in Canada is 71d., and the real wage in Great Britain is 39d. Real wages in all other countries, including Britain, are much below the real wages in America, Canada and Australia. The only reason that I can see for the higher real wages in America is a combination of more- efficient management, more effort by the workers and a greater availability of capital equipment. The approach that we should adopt in order to increase real wages is one which will, in its effect, achieve more production. Thank heavens the trade unions of Australia are contemplating the recent £1 a week basic wage increase from that standpoint. They have said to themselves, “ “What is the use of an increase of £1 a week in wages if we will not be able to buy more goods with the higher wage? “ The president of the Australian Council of Trades Unions, Mr. A. E. Monk, said immediately after the court’s judgment was made known, that he believed the trade union movement should investigate the problems of productivity and the returns that people receive for their wages.


– He denied having made such a statement, and in any event he cannot get anybody to support him.


– We heard a deplorable statement from the honorable member for Hindmarsh only the other night in which he dissociated himself from what Mr. Monk had said.


– So did all other trade unionists.

The DEPUTY CHAIRMAN. - Order ! The honorable member for Hindmarsh is interjecting too frequently.


– The Australian Workers Union ha?, a good reputation in this community because of its efforts to increase production, and it is amazing to find the honorable member for Hindmarsh, who is associated with that trade union, dissociating himself from the statement that was made by Mr. Monk. When Mr. Monk made that statement, he was aware of the conditions under which trade unionists work in other parts of the world. He knew that trade unionists in Russia are forced to flog up production, and have very few rights. He knew also that a British team of trade unionists went to America to discover the secret of- that country’s great productivity. Now we can see signs that the trade unions, which up to the present, have directed their endeavours towards obtaining a greater share of the monetary rewards of production for their members, are realizing that the position has reached a point where the workers now receive the greatest monetary share that they can possibly obtain from production, and that any increase in wages will merely be followed by an increase of prices, which will soon offset the wage increase. So now trade unions are beginning to turn their attention to the problem of increasing production itself.


– That is what the honorable member thinks.


– The honorable member for Hindmarsh has discredited himself and the Opposition. The strength of any democratic government is measured by the strength of its Opposition. If we had a strong Opposition which tried to investigate the real nature of the problems that face us to-day, Australia might make more progress than it is now able to make. But we have a weak Opposition. It is only necessary to have been in this Parliament a few months to see the vacillating way in which the Opposition treats every problem and how it suddenly changes its mind on important issues. The Opposition has actually tried to sabotage the leadership of Mr. Monk, who really desires to do something for Australia and the workers. The honorable member for Hindmarsh attempted to sabotage him last week. If the Opposition would pull itself together and really help-

The DEPUTY CHAIRMAN- Order ! The honorable member’s time has expired.


.- Despite the favorable publicity that the press of Australia has given to the budget, the clear fact remains that its provisions have been a source of bitter disappointment to the people. Every one had hoped that, in a period of ever-increasing inflation, the budget would include some measures to correct the position, with a view to putting value back into the £1. We were told ad nauseam during the last general election campaign that it was the policy of the Government parties to restore purchasing power to the £1. The Government’s statements during that campaign were re-inforced by an article written by the Treasurer (Mr. Fadden), which appeared in the financial and business review of the Melbourne Herald on the 6th March last under the following head-lines : -

Government to put value back into the £1. Fadden details hie methods.

The article was signed, “By Mr. A. W. Fadden, Federal Treasurer “. It read, in part-, as follows : -

The Federal Government is determined to put real value back into the £1 note. Our first three months in office has been necessarily a period of review, but a taxation review and a vigorous drive to cut expenditure, are already well under way.

I stress that last sentence. The provisions of the budget certainly make that last euphemistic statement laughable. To suggest that there is a review of taxes in the budget in the way it was foreshadowed is a mere figment of the Treasurer’s imagination. It is true that some small income tax concessions are made in the budget, but they will be offset by increases of sales tax. The stated vigorous drive to cut expenditure is also amusing when we realize that the budget provides for a record peace-time expenditure. Naturally people who read the Treasurer’s article were very disappointed when the provisions contained in the budget were made known. It is the object of every Treasurer, no matter to which political party he belongs, to balance his budget. The Treasurer has only balanced the budget by taking £103,000,000 from the wool-growers ostensibly in an endeavour to halt the inflationary spiral. He has made a deliberate attempt to hoodwink the people, but has not succeeded.

Prior to the introduction of the budget, members of the Government stated that measures would be introduced to tackle this most invidious problem of inflation and that the first would concern the high price of wool. The Government has made no attempt in this budget to prevent the continuation of the infla- tionary spiral. The reverse is the case. It is by no. means certain that if this £103,000,000 remained in the hands of the wool-growers they would spend the full amount. It is possible that a lot of it would be kept in cold storage for future requirements; but when the Government get9 its hands upon it every penny will be spent. I cannot accept the Government’s decision to single out the wool-growers for discriminatory treatment as there are many other sections of industry which are in receipt of inflated incomes. This wool levy has been represented by the Government as being a mere advance payment of taxation which will be due next year. This year the wool-growers have to pay their tax in the ordinary way, the same as any manufacturer or other business person. So the argument that was advanced by the Prime Minister that this is just a form of pay-as-you-earn taxation such as’ is applied to wageearners is a sham and a delusion. I make that statement on greater authority than my own - the authority of a leading article in the Sydney Morning Herald which has taken the Prime Minister to task on that very point. The Government’s case, as submitted by the Prime Minister, will not hold water. This wool levy will compromise the revenue of the country in future years and, in my opinion, the Government cannot show a credit balance of £400,000. The real, unequivocal facts are that the Government this year will have a deficit of £103,000,000.

The pension of £2 10s. a week which is to be paid to elderly and sick people is far too meagre for their requirements. It is an insignificant sum when compared with to-day’s costs, particularly in view of the extent to which the cost of living has risen since this Government came into office. Many pensioners are forced to pay 25s. a week for rooms, and all of them, in common with other people have to pay 2s. 2£d. per lb. for butter, 3s. 3d. a dozen for eggs, and 6d. a pint for milk. Those are all stable items of diet which the pensioners must buy in order to exist. I had hoped that when the Government provided for an increase in pensions it would make some endeavour to relate pension rates to the ‘ basic wage. Apparently, no effort has been made to do that. At the 5th July, 1945, the pension rate of 32s. 6d. a week was 33.8 per cent, of the basic wage; when the pension was increased in 1948 to 42s. 6d. a week, it was 36.64 per cent, of the basic wage; in August, 1950, prior to the introduction of the latest budget, the percentage had decreased to 30.8. At the present time, with a basic wage of £8 6s. in Sydney, and with the pension at £2 10s. a week, the percentage is 30.18. That must be compared with 36 per cent, when the Labour Government gave pensioners their last increase. If the Government were not prepared to make a larger increase in pensions I should have thought that it would have related pensions to the cost of living adjustments. It would not be the first time that that had been done. Cost of living adjustments were made between 1932 and 1935 and between 1942 and 1945 when the rate was fixed at 32s. 6d. a week, but such adjustments were not made after that year. If the Government is not prepared to increase pensions by a larger amount it would be a mere act of justice to these elderly folk to fix their pensions at a percentage of the basic wage. When the basic wage went up 2s. a week on one occasion, the pension was increased by 6d. That was not much but it showed that the Government was showing practical sympathy. If the cost of living rose by 5s. a week and the pensioner’s increase was only a shilling or two, that would at least represent a practical gesture, but nothing of that kind has been attempted. I hope, even now, that if the Government introduces a supplementary budget next year it will make some practical attempt to relate pensions to a percentage of the basic wage because prices will certainly rise again as the result of the £1 a week recently granted by the Commonwealth Arbitration Court as an increase of the basic wage.

I was hoping that an endeavour would be made in this budget to modify the means test for pensioners. This is a matter of great concern to many salary and wage-earners who are at present contributing to private superannuation schemes. I know that it would be impracticable to abolish the means test overnight. Before any government can abolish the means test there must be a thorough examination of the position with a view to placing pensions on a new financial basis, but I hoped, when I read the Prime Minister’s policy speech, that some attempt would be made to lighten the means test for pensioners. The Prime Minister, in his policy speech, made the following statement: -

We are deeply conscious of the frequently unjust operation of the means test, and of the penalty it imposes in many cases upon thrift. There are also great anomalies associated with the position of persons who have contributed for their own superannuation benefits. We desire, however, to adjust the anomalies I have referred to and to make such modifications in the means test as we find possible pending a contributory scheme. This great human problem will our urgent attention as a matter of priority.

About eleven months have elapsed since the Prime Minister uttered those words. I thought that some endeavour would have been made to put that promise into effect by increasing from 30s. to £2 the amount that a pensioner could earn. The gap has increased between the pension and the basic wage. The anomalies in the means test should be approached from a non-party aspect in an up-to-date fashion. It is bitterly disappointing to tens of thousands of pensioners that no endeavour of this kind has been made. I realize that huge financial problems are tied up with the means test, but many persons who have a little money or who have contributed to superannuation schemes are being deprived of a large part or all of the pension under the present system. A person who, over the same period of working life, has received the same wages as the person who has saved, but has lived up to his means receives the full pension. That is wrong. I was hoping, in view of the statement that the Prime Minister made last year, that the Government would face up to this problem. However, it has decided to side-step the matter

I was pleased to see that provision has been made in the budget for increased pensions for ex-service men and women. However, I think that the increases are totally inadequate in view of the excessive living costs, and if a supplementary budget is introduced if. the new year I hope that the Government will take further measures to increase these pensions. “When the Chifley Government was in office there was considerable agitation, particularly from the “War Widows’ Guild led by Mrs. Vasey, for increased war widows’ pensions. Honorable members who now support the Government, but who were in Opposition at that time, were very eloquent in their protestations that the last Government was not doing the right thing hy the war widows and that it was, consequently, letting the returned men and women down. In view of that flow of eloquence over many months, I expected to find that the Government would fix the war widow’s pensions at a rate which would be in keeping with the energy displayed on behalf of the widowers by the Opposition members of . that time, but the increase for war widows is only 10s. per week. Mrs. Vasey, the lady who was very critical of the Labour party twelve months ago, is now very critical of this Government. On the 13th October, the Melbourne Herald published reports of interviews with various people, one of which read as follows : -

Thu Federal President of the War Widows’ Guild, Airs. G. A. Vasey - The hopelessly inadequate rise nf 10s. is ti ic must tragic mistake that the .Federal Government lias ever made. In .1918 the Government, with u revenue of about ?89.000,000, paid war widows a pension nf ?2 2s. which was 90 per cent, nf the then basic wage. To-day, with a budget revenue of more ‘than ?700,000.000, a war widow’s pension is to bc ?3 10s. or 45 per cent, of the new basic wage.

A lot of people who supported the parties opposite because of the promises which they made last year are certainly not supporting them now that those promises Lave not been translated into fact. When honorable members who now support the Government were in Opposition they also spoke about the iniquitous effect of the sales tax. One can pick up hardly one volume of Hansard of former years without reading that some honorable member of the then Opposition had stated how sales tax affected the cost of living of the workers and of how it was more deadly than income tax. They also alleged that the Labour party had been guilty of gross treason against the working class in not dealing with that matter. After hearing those comments, I should have thought that the Government would have made provision to release the working class from that load which they have found it so hard to carry. Some articles have been exempted from sales tax to the amount of ?1,000,000 a year but, in respect of other items, the sales tax has been increased to the amount of ?10,000,000 a year. I read the following report in yesterday’s issue of the Melbourne Age: -

Mr. K. B. Coles, VicePresident of the Taxpayers’ Association of Victoria, stated at the animal meeting yesterday that sales tax was a major factor in reducing the purchasing power of the ?1.

The Government’s own supporters are chiding it for increasing the sales tax. The addition of ?10,000,000 to the proceeds of the sales tax will reduce the purchasing power of the ?1.

Mr Bowden:

Mr. Coles is a Labour supporter.


– No. He is a great supporter of the Institute of Economic Relations. He has always been an ardent supporter of the Taxpayers Association and I have yet to- hear of one member of the Taxpayers Association who is a supporter of the Labour party. Some of the increases in sales tax announced in the budget are open to the most cogent criticism. For instance there is a need for an explanation why the sales tax on wireless sets has been increased by 25 per cent. Clocks, fountain pens, suit-cases, shopping baskets and wireless sets are far from being luxuries, they are everyday necessaries. ‘ The list was apparently drawn up for one purpose only; that is to obtain revenue irrespective of social necessaries. The protestations that we heard in the past from the Government parties about the iniquities of the sales tax, pale into insignificance when compared with the protests that can be raised against taxing those items. Even in twenty years’ time, this action will be held against the Government. During the last general election campaign the Government parties, in an endeavour to obtain votes, stated that, if elected to office, one of the methods that they would adopt to put value back into the ?1 would be to reduce the sales tax. I shall quote from a manifesto issued by the Liberal party in the electorate of Batman. The quotation is as follows: -

To the Mothers and Fathers, Young Men and Women of Batman. . . there is a big job ahead, first of importance being that of putting value back into money. . . .

Then the author of this pamphlet cited price increases. I wish to direct the attention of the committee particularly to the next sentence, which we may be assured will never again find its way into a Liberal party manifesto. It is -

Every time a woman buys lipstick or a box of face powder, she pays tax.

That was an endeavour by the Liberal party last December to gain the votes of women because the previous Government had imposed sales tax on face powder and lipsticks. Yet this Government is increasing the rate of the tax. After reading of the iniquitous imposition of sales tax by this Government, we may be sure that such a claim will never again be advanced by the Liberal party during ah election campaign.

I shall now turn to the Prime Minister’s remarks about prices control. The right honorable gentleman attempted to deride the Labour party’s proposition that prices control should be re-introduced on a Commonwealth basis. In 1948 the Chifley Government, with rare political foresight, observed the dangerous inflationary tendency that was then developing in the nation, and whilst not contending that prices control would prevent inflation, knew that it would ameliorate our condition. Therefore, it proposed that prices control would be made a permanent feature of our economy. The electors were told by the Liberal party that the cause of inflation was not that prices were uncontrolled but that this country needed to free industry from the fetters of government control, and that once the fetters were taken off industry the demand for goods would be overtaken and prices would return to normal. When the fetters were removed it wasfound that it was prices and not production which soared. The removal of prices control did notimpose the slightest check on the upward trend of prices. The States have failed completely to exercise adequate control over prices. They all admit that, and most people realize that effective prices control is beyond the power of any one State. Australia is an economic unit, and any attempt by the States individually to control prices is sheer folly. The States adopted the method of de-controlling prices, but then realized the futility of such a course and have now decided to reimpose prices control on thousands of consumer goods. They have also requested a Commonweal th-States conference, and the Prime Minister announced to-day that such a conference had been arranged and that a date had been fixed for it. I am of the opinion that the only effective method of keeping prices within reasonable bounds is the re-imposition of Commonwealth control. That would be a prelude to other and more basic measures which are needed to meet the present emergency. The Treasurer said in his historic budget speech -

I have emphasized, as the Prime Minister has done elsewhere, the imperative need to concentrate energies and resources on those tasks which will best servo 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.

I should be very interested to know what is the “general economic, policy “ of the Government. We have been told that the wool tax is a part of that policy, and that possibly others will follow.


– It is not a tax.


– The wool-growers think differently from the honorable member for Mallee (Mr. Turnbull), and those honorable members on the Government side who represent constituencies in which wool is grown will realize that at the next general election. The Government has suggested a number of measures designed to cure inflation. I shall dispose at once of the canard that is always advanced by the Government when the subject of inflation is mentioned. The Government maintains that the main action which must be taken to combat inflation is to induce the worker to work harder. Soon after I entered this Parliament I heard honorable members on the Government side during the debate on the Address-in-Reply stress time and again the necessity for harder work to increase production. The proposition cannot be advanced too strongly that if we wish to produce in sufficient quantities to halt the inflationary spiral, our methods of production in many industries must be modernized. Owing to the circumstances that operated in this country during the war and have operated since then, there has been a high level of demand which has made it easy for manufacturers to make large profits without worrying about the efficiency of their factories. They have also had tariff protection to lull them into a state of complacency and security. Australia should follow the example of England and try to increase its production in a sensible fashion. Teams of employers and employees have been sent from England to study American methods of production. An association has been formed in England called the AngloAmerican Council on Productivity which has sponsored such visits. . It is realized in that country that it is not right to abuse the worker for lack of production, but that more modern methods should be introduced in the factories. No one has ever suggested that the Economist is anything but a conservative periodical. I shall quote from the issue of that journal dated the 20th May, 1950-

page 1506


Most of the teams which have visited the U.S. under the arrangements made by the Anglo-American Council on Productivity have been concerned with their particular industries alone. As their reports have shown, certain, factors which make for high productivity in the U.S. are common to many industries. The most recent reports of the productivity reports is an attempt by a specialist team to isolate one of these factors, the mechanical handling of materials.

The team visited some good progressive factories and it is not surprising that its members should have come back convinced that British industry stands to gain a great deal from a more resolute attitude towards the methods used in handling its materials.

Turnover can be increased, buildings and plant more fully utilised, quality improved, fatigue and waste of effort avoided, and the costly accumulation of work in progress can be cut down. Costs, in short, can be reduced and a better return obtained for any given expenditure of money and effort.

One great example of the success of introducing modern methods may be found in the British steel industry. [Extension of time granted.] Recently in England a report was issued by a productivity team which had previously visited the United States in connexion with the iron foundry industry. The employers in the group went back to their factories and carried out the recommendations of the team. By the utilization of the devices they had seen in America splendid results were achieved. Some firms increased production by 50 per cent. over the 1939 figures, and the total man-hours involved were reduced by 10 per cent. It was thought that a new lay-out of the factories would reduce the man-hours by 50 per cent. and eventually 75 per cent. In this industry in England prices have remained steady for the last two years whilst earnings and output have increased. The employer can contribute far more than the worker to increased output, because after all a worker cannot work faster than the speed of the machine upon which he is engaged. In this country there is not nearly the same efficiency as may be found in America. Instead of gratuitously insulting the worker on every possible occasion and saying that he should produce more, his critics should realize that any appreciable and tangible increase of production can be achieved only by striving towards greater technical efficiency. In 90 per cent. of the cases an improvement of efficiency is in the hands of the employers themselves.

Progress reported.

page 1506


Customs Tariff Amendment (No. 3) ; Excise Tariff Amendment (No. 1)

In Committee of Ways and Means:

Minister for Defence · Wakefield · LP

– I move- [Customs Tariff Amendment (No. 3).] (1.) That the Schedule to the Customs Tariff 1933-1949, as proposed to be amended by Customs Tariff Proposals, be further amended as hereinafter set out, and that on and after the twenty-seventh day of October, One thousand nine hundred and fifty, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1 949 as so amended. (2.) That in this Resolution “ Customs Tariff Proposals “ mean the Customs Tariff Proposals introduced into the House of Representatives on the following dates, namely : - 11th May, 1950 ; and 8th June, 1950.

[Excise Tariff Amendment (No. 1).]

That the Schedule to the Excise Tariff 1921-1949 be amended as hereinafter set out, and that, on and after the first day of July, One thousand nine hundred and fifty, at nine o'clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Excise be collected in pursuance of the Excise Tariff 1921-1949 as so amended. The only commodity affected by the customs and excise proposals I have just introduced is matches. The excise duty on matches has been reduced by 9d. on 8,640 matches, that is the equivalent of a gross of boxes each containing 60 matches. The reduction will operate from the beginning of the present financial year and an arrangement will he made to refund the excess collections that have been made. The variation will not affect the present retail price of matches, its purpose being to offset increased costs in the industry and to obviate an increase of the present price. The corresponding reductions indicated in the comparative statement circulated to honorable members with copies of the proposed resolutions, have been made in the customs duties on imported matches, so as to maintain relativity between the rates. However, so as to obviate administrative difficulties, the reduction of customs duties has not been antedated but will operate from to-morrow morning. Progress reported. {: .page-start } page 1508 {:#debate-25} ### WAR PENSIONS APPROPRIATION BILL 1950 Bill returned from the Senate without amendment. {: .page-start } page 1508 {:#debate-26} ### QUESTION {:#subdebate-26-0} #### BUDGET 1950-51 *In Committee of Supply:* Consideration resumed *(vide* page 1506). {: #subdebate-26-0-s0 .speaker-JRB} ##### Mr BOSTOCK:
Indi .- During the course of this debate there has been a good deal of discussion of detail, most of which has been along party lines and has included recriminations and a certain element of abuse. I find it necessary to clear my mind upon the whole subject of the function of government. The budget provides the means by which the Government carries on the administration of the country, and it is of value to understand just what that responsibility involves. In its basic form, it can be stated simply. The function of any government is to solve two problems, the first of which is to maintain the security of the country, and the second to improve the living standards, contentment and happiness of the people. Those are not light tasks.* No government can carry them to a conclusion unless it has the help of the Parliament as a whole and, indeed, of the whole of the people. Conditions in the world to-day are not encouraging. In fact, they are so disturbing that they occupy the urgent attention of most thinking men. We, like every other democracy, are hopeful that we shall be able to ensure the maintenance of a peaceful world. Yet, there is a serious threat to that peace, .and it comes from one source only. That source is Russia. The threat to the peace of the world is not communism; it emanates from Russian imperialism - the aim of the Russian dictator State to dominate the world. The Russians are clever enough to use communism as a weapon. The Russian plan, which is being revealed more clearly every day, consists of three phases. The first phase has been operating with considerable success for the last five years. During this phase Russian imperialism hopes to sap the resources of the democracies by causing internal dissension, obstruction and confusion and by retarding the recovery and development of potential opponents of its ambition of world domination. In Australia, we have had demonstrations of the effectiveness of this weapon of communism. It is only within the last few weeks that we have struck the first effective blow in our own defence by passing the Communist Party Dissolution Bill. There has been a lot of controversy and discussion about the details of that bill. However, the principle behind the bill is acceptable to every member of the Parliament and to practically every Australian. Therefore, we want to be clear about the objective at which we are aiming so that we shall not confuse the principle and the vital issue with a mass of detail. We should give up talking about Communists. We should describe them correctly, that is, as foreign agents, traitors, and spies. If we did that we should no longer have people espousing their cause, mistakenly in many instances, under the impression that the Communists' ideas are more or less political. The Communists are, in fact, enemies of our country who are working in accordance with the first phase of the Russian plan for world domination. By causing chaos and confusion in our industries, they hope - indeed, they have already achieved success - to reduce our capacity to defend ourselves. The same tactics have been applied to retard the development of the national resources of their major opponents in the world, namely, the United States of America and the United Kingdom. That first phase of Russian aggression has paid very good dividends, and it is still going on. It is only now, after the Communists have been practically unhindered in their activities for the last five years, that the democracies are beginning to realize that if they are going to build up their defences and potential war resources they must combat this sabotage and disruption of foreign agents, spies and traitors. The second phase of this plan is quite clear ; and it follows a very sound military principle. It is to divert and disperse the forces that the Russians fear they may have to meet. They do that by creating, through satellite countries in almost every instance, incidents throughout the world. I do not believe that the Korean incident just happened. It is a part of the Russian plan to force the democracies to disperse their resources. The same thing is going on in Malaya. Korea having served its purpose, the main effort of the Russians in carrying out the second phase of their plan has been directed to Indo-Ohina. It has now been reported - I expect with truth, although not officially - that Russian Communist-inspired troops have invaded Tibet. We have the example in Europe of forces being constantly kept engaged because of friction over the Berlin question. That is all a part of the second phase of the Russian plan and it is concurrent with the first phase. The third phase of the Russian plan will be inevitable if the first' two phases succeed. I do not believe that war is inevitable, but I do- believe that if the Russians are successful in reducing the war potential of the democracies to a degree which will encourage them to believe that they have a reasonable chance of success they will come to the third phase of total war. In that war there will be no victors or vanquished. If such a catastrophe occurs, all nations will be prostrated and exhausted. Therefore, while recognizing this Russian plan, we should realize that our best and surest means of averting the final catastrophe is to take such steps that these preliminary phases shall not reduce the democracies to a stage at which their lessened capacity to defend themselves will incite the Russians to implement the third phase of their plan. Perhaps, some people will say, " Yes, that is all very fine. Platitudes ! Every one knows that. Why tell us?" The answer is that we are prone to think that Australia is only a small nation and cannot have a very great effect upon the destinies of the world. That is a fallacy, because if every nation considered that it was unable, alone, to combat a menace no nation would make any attempt to do so and its defeat would be certain. Even though Australia is a small nation, we must show our determination to 'play our part to the maximum of our resources. It is for that reason that the Government has introduced its new defence plan. That plan is a step in the right direction. I, personally, do not think that it goes far enough. I believe that national service should include the responsibility for service anywhere in the world where the defence of Australia can best be provided for. I do not believe that any thinking person is convinced that Australia, or any other country, can be effectively defended by sitting back and waiting until the enemy arrives on its shores. The only effective defence is to meet the threat as far away from Australia as we possibly can, and scotch it in the bud. To do that we must have forces available to meet the enemy wherever he can best be defeated. I know that a substantial section of public opinion in Australia is objecting and, traditionally, has objected, to compulsory military service, particularly outside Australia. That traditional objection must be broken down and the Opposition can play a very important part in making clear to the people the necessity for doing so. A world catastrophe may be avoided and the lives of Australians may well be1 saved if we agree to play our part in a world scheme of defence against the threat of domination by Russia. Another aspect of the Government's defence plan should be reviewed, in my opinion, at some not too distant date. I refer to the length of service that national trainees will be required to give. As a nation, we consider that, with the development of modern military technique, a period of six months training is sufficient. I find that opinion very hard to reconcile with the fact that the governments of 'both the United Kingdom and the United States of America have recently decided to increase the period of compulsory training from eighteen months to two years. I believe that we are too optimistic in thinking that we can train our men adequately within the short period of six months. I repeat emphatically that there is a very human aspect to the training of (fighting men. Everybody who has thought about this subject will agree with me that to send untrained troops into combat is to take a sure way to suffer heavy casualties. Therefore, from a humanitarian point of view alone, it is desirable that, in the event of war, our troops shall take the field fully trained to protect themselves so that our casualties may be as light as possible. Closely allied to the subject of national security is that of national development. This thought brings me to the second basic function of government that I mentioned earlier - the promotion of the prosperity, contentment, general welfare and happiness of the people. That function can be discharged successfully only if we have the ability to address ourselves as a team to the problem of defeating the inflationary spiral. I do not want to repeat platitudes. Honorable members acknowledge that the basic reason for inflation to-day is to be found in the fact that the spending power of the community exceeds the quantity of the goods that are available. Having accepted that fact, we are driven to the conclusion that there are two ways of restoring balance to our economy. One method is to reduce spending power and the other is to increase the quantity of goods available for purchase. The first method is negative. In fact, it reduces prosperity and retards progress. However, it may have to be employed as a temporary expedient, until stability is achieved. {: .speaker-JF7} ##### Mr Beazley: -- Is that why the Government has introduced the wool sales deduction scheme? {: .speaker-JRB} ##### Mr BOSTOCK: -- It is one of the main reasons why the plan was included in the budget. The increased return from the sale of wool this year will inject into our economy more money than was previously expected. In addition, the payment of war gratuity, the increase of the basic wage and the maturing of a loan, a portion of which will be realized in cash, will add to the inflationary tendency during this critical year. Therefore, the Government has been forced to adopt the negative method of endeavouring to check the spiral temporarily by skimming some of the surplus purchasing power of the community. I am a small wool-grower and I consider that the wool sales deduction scheme is quite acceptable and provides a good solution of a difficult problem, although I should like to have some of its features changed if possible. For instance, I should like the legislation to be effective for only 'twelve months so that it mustbe re-enacted each year if that were found to be necessary. That would help to convince the small woolgrower that the arrangement was merely a temporary expedient. also thing that more effective machinery than is proposed should be established to deal rapidly with cases of hardship. Under the bill as it now stands, applications for relief will be dealt with by the ordinary machinery of the Taxation Branch and by Land Valuation Boards. But every wool-grower who considers that he is suffering from hardship will be required to wait until he receives his income tax assessment before he can appeal for relief, although the 20 per cent, deduction will be levied as soon as his wool is sold. I should prefer a system that would enable an applicant to apply for relief and to establish hardship before some court between the date of sale of his wool and the date of receipt of payment for it, usually a period of about one month. {: .speaker-JF7} ##### Mr Beazley: -- Is there not a good case for deducting profits from some other booming business as well as from the wool industry? {: .speaker-JRB} ##### Mr BOSTOCK: -- I am concerned at the moment only with the expedient of reducing the spending power of the public. The wool sales deduction scheme will effect a reduction of £103,000,000, which will be well worth while. I emphasize that it is only an expedient and must be regarded as such. "We must get down at once to the positive method of restoring balance to our economy by increasing the volume of goods available to the community. That method will establish true prosperity. I shall now say something that members of the Opposition will not like. The only way to bring the volume of goods on the market nearer to the level of the community's purchasing power is to produce more goods and services. I do not want to be misunderstood. I do not suggest that people who work with their hands should work for more than 40 hours a week. The Arbitration Court has established the 40-hour week and, as far as I can see, if every man at the factory bench, every coal-miner, every railway worker and everybody else in the community works conscientiously and honestly, without absenteeism, for 40 hours in every working week in the year, the desired result will be achieved. Management and labour are equally responsible. Each one of us must work hard. According to my calculations, if every man and woman in Australia would work a conscientious 40-hour week, allowing for holidays and legitimate sick leave, the production of goods and services would he increased by from 20 to 30 per cent. That would be a definite step towards prosperity, but it cannot be achieved by the worker alone. Managements must work harder also. Technical efficiency must be improved and overhead costs must be reduced. In order to give point to my argument, I shall make use of a hypothetical illustration. It will probably be very inaccurate in detail, but it will underline the point that I want to emphasize. Let us suppose that more continuous and conscientious work on the part of all sections of the community should come about overnight. What effect would that change have upon the cost of a house that "is now worth about £2,000 ? The man working in the forests would cut sufficient timber for the house in 20 per cent, less time than previously. The sawmiller would prepare the timber in 20 per cent, less time. The steel worker, and the coal-miner whose production enables the steel worker to do his job, and all the other workers would do their tasks in 20 per cent, less time. The management would be 20 per cent, more efficient, and the team of builders who assemble the materials would erect the house in 20 per cent, less time. Thus, 20 per cent, of the wage factor, from the raw material to the complete house, would be taken out of the cost and the building could be sold for about £1,600 instead of £2,000. Everybody concerned with its construction would have worked the same length of time as normally and would have the same amount of wages. That would be an example of true prosperity. Value would be put back into the £1. As I have said, that example probably bristles . with inaccuracies but it illustrates the general principle of my argument. I repeat that I do not suggest that the workers as a class should work harder or longer than they do now. My suggestion is that everybody should work conscientiously for the times normally prescribed under our arbitration awards. If we can increase our production of goods and services by 20 per cent., we shall establish true prosperity. We can defeat the threat to our prosperity only by concerted effort and unified action to increase production, and we can ensure our security only if we are prosperous and so develop our resources that we shall be able to resist aggression. In the words of the greatest man of our century, " Let us to the task " to achieve the two fundamentals of government, namely, to ensure our security and to promote the prosperity, contentment and happiness of our people. Let this Parliament work as a unit for the common good. Let us make Australia the stronghold of freedom and democracy, and the home of gracious living. {: #subdebate-26-0-s1 .speaker-JUX} ##### Mr MINOGUE:
"West Sydney -- I cast my mind back to the GovernorGeneral's Speech on the 22nd February last, in which the Government proclaimed an optimistic policy, and I compare it with the gloomy tones of the budget that was presented to this chamber a fortnight ago. I have carefully considere*d every line in those two documents, and I am profoundly impressed with the difference between expectation and realization. I have appreciated various speeches that have dealt with matters concerning the welfare of the nation, but I am sadly disappointed with the contents of the budget. My disappointment is shared by many hundreds of people throughout Australia, some of whom are supporters of the Labour party, whilst others are supporters of the Liberal party and the Australian Country party. The promises made by the present Prime Minister **(Mr. Menzies)** during the last general election campaign have not been fulfilled. The budget does not even pretend to honour them, and I believe that the Government has no intention of giving effect to them in the future. The honorable member for Indi **(Mr. Bostock),** in common with other Government supporters, has offered no solution of our present economic difficulties other than to repeat the slogan " Work harder ", and to blame the Communist party for impeding' production. What action has the Government taken to combat communism ? It is well known that communism must be checked by measures that will alleviate distress among the working class throughout the world. I expected that as a preliminary move against communism the Government would introduce logical and tangible measures to improve the living conditions of workers in this fair land, but that fundamental step has been ignored. The Commonwealth, which has a monopoly in collecting income tax, should have announced a national housing programme, because no factor is upsetting the welfare and happiness of the workers to a greater degree than is the problem of living accommodation. The three political parties represented in this chamber are in agreement upon the broad principles of the immigration policy. Although migrants are being brought here at the rate of approximately 90,000 a year, only 10,000 prefabricated houses are being imported. That disparity makes heartrending reading for young Australian men and women, who wish to marry and settle in their own homes, because under our immigration scheme, we are bound, and rightly so, to provide accommodation for- the migrants. I have before me *The Good "Neighbour,* which is printed in Canberra, and I notice in its columns a reference to one family of sixteen persons who are coming to this country. The ages of the fourteen children range from eighteen years to four months. Accommodation must be provided for them, with the result that a young Australian married couple will be deprived of a home. If they were suitably housed, they would probably have a child in twelve or fifteen months time, who on attaining adulthood, would assist to defend this country. Unfortunately, the Government has **Mr.** *Minogue.* not taken any action to accelerate the building programme and thus provide homes for young Australian men and women. The preceding Labour Government, which was in office for nearly five years during World War II., was bound to concentrate its efforts upon the prosecution of the war, and was not able to devote so much time as it would have liked to building homes for the workers. Government supporters frequently tell us that Australia is enjoying conditions of great prosperity., Many millions of pounds are being received from the sale of our wool, and of other goods and commodities. The least that we can do with a part of that wealth is to engage in a vigorous housing programme so that young Australian workers may be able to live in reasonable comfort. The honorable member for Indi cited a hypothetical case of a home costing £2,000. He chose a low figure. The imported prefabricated dwellings cost £2,500, and the addition of the cost of land, electricity and other services would increase the price to more than £3,000. Even under the provisions of the Commonwealth and State Housing Agreement, the rent that is payable for a home of that type is not less than £2 10s. a week. Workers may be receiving fairly high wages, and many of them will draw an additional 24s. a week from the beginning of December as the result of the decision of the Commonwealth Arbitration Court in the basic wage case, but they are not in a position to pay £3 or £4 a week in rent, as many of them would be required to do if they wished to have a comfortable house at the present time. The Government, if it sincerely wished to combat communism, would formulate a tangible plan for the accommodation of the workers. When the Minister for Works and Housing **(Mr. 'Casey)** intervened in this debate, I expected that he would announce a grandiose plan for overtaking the housing lag, and I was disappointed when he did not do so. The honorable member for Bennelong **(Mr. Cramer)** has condemned the McGirr Government in New South Wales for its alleged failure to build sufficient homes for the people.. I have read that the Government of Tasmania has withdrawn from the Commonwealth and State Housing Agreement, which, evidently, is not very satisfactory and has reduced interest rates on home building by 1 per cent. {: .speaker-KWH} ##### Mr Townley: -- The Government of Tasmania promised to reduce interest rates, but it has not yet done so. {: .speaker-JUX} ##### Mr MINOGUE: -- A Labour government honours its promises, and I have no doubt that the Labour Government in Tasmania will fulfil that promise. But when a government, like the Menzies Government, has no policy, the outlook is hopeless. The Commonwealth now pays a subsidy on wheat, butter, tea and woollen goods consumed in Australia. Why should it not subsidize housing? If migrants are brought to this country at the rate of 90,000 a year, our housing position in two years will be calamitous. The honorable member for Indi urged the workers to work harder. Some months ago, the president of the Liberal party in New South Wales, **Mr. Ritchie,** told them that they should work 56' hours a week. However, the leader of the Parliamentary Liberal party in New South Wales, **Mr, Treatt,** was not prepared to go to those lengths during the last general election campaign in that State, and said that he agreed that the standard working week should be one of 40 hours. I deduce, from his attitude, that the 40-hour working week is not responsible for any of our present economic difficulties. Much has been made of the proposed wool sales deduction. Some of our economic difficulties are due to the fact that certain sections of the community such as the wool-growers and the brewers have too much money. Why does not the Government arrange for those patriotic people to invest their surplus funds and excess profits at a low rate of interest, for the purpose of financing a housing programme and other urgent requirements? I read in the press to-day that £1 shares in Tooth and Company Limited, brewers, are now valued at £6 10s. Yet Government supporters tell us that the country is going from bad to worse. That brewery is now able to satisfy only 60 per cent, of the present demand for beer, and I assume that if it were able to increase the production of liquor, the value of its shares would be substantially greater. The Government has treated the pensioners in a disgraceful manner. {: .speaker-KBH} ##### Mr Wilson: -- Did the Chifley Government increase pensions last year? {: .speaker-JUX} ##### Mr MINOGUE: -- The only retort that Government members can make to a reasoned criticism or to a statement of fact is, " What did the Chifley Government do ? " That is why the outlook for the present Government is hopeless. The preceding Labour Government, under the leadership of the right honorable member for Macquarie **(Mr. Chifley),** did a good job in war and in peace. It won the war, and its predecessor, the Curtin Labour Go v ~. anient, helped to win the war. Under its wise administration, Australia passed almost tranquilly through the transition period from a war-time to a peacetime economy. The people who are represented by honorable gentlemen opposite were in reserved occupations during World War IX, and did not have to defend their country. They enjoyed the freedom of being civilians, whilst the trade unionists fought their battles. That is one of the reasons why I believe that, if those people have too much money now, they should contribute their excess profits to enable the conditions of the workers to be improved. The Australian Country party wing of this Government refused to tolerate the imposition of a tax on the excess incomes of wool-growers, and a wrangle developed between it and the Liberal party on that issue. The Australian Country party dictated its terms to the Liberal party, and the wool sales deduction, which is a poor substitute for a wool tax, has been adopted as a matter of policy. Government supporters direct attention to the so-called differences among members of the Labour party. They almost shed tears of blood because we have disagreements in caucus and elsewhere, but I warn them that the present Government will not he returned to office at the next general election.. It has failed miserably to honour its promises to the people to put value back into the £1. The purchasing power of the £1 in 1950 is approximately one-half of what it was in 1939. If the £1 continues to bleed to death, we shall speak, in the future, of putting value back into the 10s. I have received a circular letter from the Granville Central Branch of the Original Old-age and Invalid Pensioners Association appealing for my assistance to remedy the injustice from which pensioners generally are suffering. Omitting the formal parts, the letter is as follows : - >We seek your support in our strivings for a better deal. Our pension is now £2 2s.6d. per week. But the basic wage is £7 2s. So our pension is nowhere near half the basic wage, . supposedly the minimum on which a couple can live, > >Further, our pension is pegged; there are no quarterly increases for us, as the cost of living soars, as there is with the basic wage. Workers, we know, consider these quarterly increases utterly inadequate to make up for the continual lifts in prices. Well, how much more unjustly are we pensioners hit. as our pensions are pegged? > >Every new price rise is a further plundering of our pockets and purees; and there is only £2 2s.6d. in them to pay rent, buy fuel and clothes, pay fares and eat from each week. > >We are calling for an increase in our pensions to half the basic wage; with quarterly cost-of-living increases, as with the basic wage. This is not an extravagant claim. It can be met by the Government allocating from the people's money raised by taxation (for socialservice to assist in sickness, unemployment and old age, incidentally) sufficient to meet the needs of the aged instead of making mad preparations for a new war. This means using the people's money to maintain life instead of to destroy it. > >We arc organized in our association, but our strength alone is not great enough to force action from the Government. We need your support. Every one of you has elderly folk near and dear to you; every one of you will yourselves be old one day. ' You then, with us, have a vital personal interest in our demands. > >In the name of justice for us elderly people, we ask your support for - > >Minimum pension to be half the basic wage. > >Pensions to be subject to quarterly costofliving increases as the basic wage is. > >Abolition of the means test as affecting pensions in general up to the basic wage income. In view of the pathetic appeal for justice made in that letter, I emphasize two points that arise out of the budget that we are now considering. First, it proposes to 'provide many millions of pounds for the conduct of the war in Korea. I do not criticize that expenditure, because I believe it to be necessary. At the same time, one cannot help contrasting the readiness of the Government to provide huge sums of money for wars with its parsimous and niggardly attitude towards a helpless, defenceless and uninfluential section of our people. Secondly, since the budget provides for a record expenditure of £ 738,000,000, surely it is not too much to ask the Government to increase age and invalid pensions by a mere 10s. a week. It would cost approximately £10,000,000 annually to give a pension of £3 a week. If the present Government is not prepared to do that I am sure that when Labour returns to office it will not continue to deny justice to such a deserving section of the community. I also point out to the Government the anomaly involved in its decision not to make an increased allowance in respect of invalid pensioners who have dependent children under sixteen years of age. Quite obviously, a pensioner who has a child or children cannot maintain herself and children on her pension of £27s. 6d. a week. The position of people in such circumstances must be deplorable, and something must be done that will provide more humane treatment for them. The present Government is continually urging the workers to work harder and to eschew communism. The people of West Sydney, whom I represent, are tired of waiting for the Government to do something for the pensioners, who are now suffering so acutely because of the hopeless inadequacy of their pensions to cope with the ever-increasing cost of living. As the result of a function which they conducted in the Sydney Town Hall recently £250 was raised to provide Christmas cheer for the old people of West Sydney. I thank the workers of West Sydney for their generous action. I also take this opportunity to express my appreciation of the action of the Sydney City Council in providing £6,000 for a Christmas treat for the age pensioners of 'Sydney. I regard it as deplorable that the time of the National Parliament should be occupied almost exclusively in discussing inflation and in arguing about the disposal of the huge excess profits made by many fortunate individuals in the community while the old and infirm members of the community, whose hard work in the past has brought us to our present state of prosperity, receive scarcely a moment's thought. It would be only fair if those who have made excess profits were to make a voluntary donation or loan of a substantial portion of their surplus wealth to enable the Government to do the right thing by our old people. I bring before the committee now the view expressed by the Prime Minister **(Mr. Menzies)** in a letter that he wrote to me on the 17th March last in reply to certain representations that I had made on behalf of the United Ago and Invalid Pensioners Association of Australia. Before reading the letter to honorable members I remind them that the writer is the individual who promised that he would restore the value of the £1. Of course, no one is suffering more in consequence of his failure to do so than are the unfortunate pensioners. The letter is as follows: - >I wish to acknowledge your letter of the 0th March, and the attached communication addressed to you bv **Mrs. M.** A. Huntress, honorary general secretary of the United Age and Invalid Pensioners Associations of Australia. > >You might advise **Mrs. Huntress** that' there are now Approximately 410,000 invalid and age pensioners, and the suggested increase to £3 per week in pension rates would entail a heavy increase in expenditure. My colleagues and I are deeply conscious of the effect ot rising living costs upon the financial position of pensioners and others with fixed incomes and every effort will be made to assist them. However, it is unlikely that the vast additional expenditure involved in the suggested general increase will be practicable at the present time. > >The Minister for Social Services **(Senator the honorable W. H. Spooner)** is now preparing some information on social services foi consideration by the Government, and I will forward **Mrs. Huntress's** letter to him tu ensure that her comments are taken into account when pension rates are under review. The observations in connexion with the abolition of the means test will be borne in mind when this matter is being considered. The Minister for Social Services **(Senator Spooner)** subsequently advised the pensioners to go out and work. {: .speaker-KDH} ##### Mr Eggins: -- The preceding Labour Administration did not do anything to assist the pensioners. {: .speaker-JUX} ##### Mr MINOGUE: -- I was not' a member of the last Parliament, and therefore I cannot be blamed for any omissions with which the Chifley Government may be charged. Undoubtedly, the reason why the. Minister for Social Service decided to increase the permissible income of pensioners was to drive them out to work, and every honorable member must realize the probable effects of that decision on many old people. Many of them are now so impoverished that they will drag themselves out to work, regardless of the disastrous effect which exertion will have on them at their age and in their state of health. Further evidence of the inflation that is occurring under the present Government is supplied in the statement made by the Minister for Latour and National Service **(Mr. Holt),** in the course of a broadcast cn the 22nd October last that an ordinary two-bedroom cottage would now cost about £200 more to build than it did formerly. What is the Government doing to remedy that situation ? One needs only to glance through the budget to realize that it is utterly lacking in any constructive proposals. Of course, we all know that the present Government is not concerned with improving the conditions of the workers, but is concerned solely with the welfare of those who subscribed so generously to its funds before the last general election. I know from my daily experience in Sydney that the people now realize the mistake they made when they elected the present Government to office. They are very bitter in their condemnation of the Menzies Administration. Further evidence of the inconsiderate attitude of the present Government towards pensioners is revealed by the statement made by the Treasurer **(Mr. Fadden)** in this chamber yesterday. That statement is as follows : - >On the 24th October, the honorable member for Watson **(Mr. Curtin)** asked whether, as increases proposed in the salaries of justices and judges of the High Court and the Commonwealth Arbitration Court and Conciliation Commissioners were to operate from 1st July last, the Government would also make increases proposed in civil and war pensions retrospective to that date. > >I would inform the honorable member that it is not customary or considered practicable to make increases in pension rates retrospective. I would remind the honorable member that none of the pension increases introduced in recent years by the previous Government was made retrospective. I realize that supporters of the Government, including many young men who have just been elected to the Parliament, raise the parrot cry, "Why didn't your Government do something to improve the conditions of pensioners ? " Of course, they are told to say that ; but it is a pity that they do not devote their energies to spurring the Government which they support to do justice to the unfortunate pensioners. However, I cannot believe that, the present Government will retain office for very long. If the anti-Labour parties are so foolish as to seek an early general election, I confidently predict that Labour will once more be returned to office under the leadership of the Leader of the Opposition **(Mr. Chifley).** {: #subdebate-26-0-s2 .speaker-KCD} ##### Mr DAVIS:
Deakin .- The honorable member for West Sydney **(Mr. Minogue)** spoke with great sincerity, but in many respects without knowledge of the subjects with which he was dealing. He referred to the inflow of migrants to this country and said that the present annual intake of migrants was 90,000. According to the last report of the Commonwealth Bank, to which members of the Opposition take such delight in referring, the number of migrants admitted to Australia last year was 149,000, and the total acquisition of migrants for the current year is expected to reach 200,000. It is quite evident, therefore, that the honorable member did not take the trouble to inform himself of the facts concerning migration. The honorable member devoted a substantial portion of his time to the discussion of housing. That again illustrates a sincerity that was not backed by a knowledge of the circumstances. A Tariff Board report which has been previously quoted here uses the following words, in a reference to the housing problem : - >No one will deny, for example, the importance of extending the building programme and of increasing employment in that field. There must, however, be a proper balance, and it would be absurd to have labour available for construction and no materials, tools. &c, with which to build. This is a typical problem vhich must be surveyed on a broad basis, since diversion from factory production to building construction could, in some circumstances, aggravate the difficulty it was proposed to relieve. The honorable gentleman's remarks are an example of well meant enthusiasm that is not supported by knowledge. After all, the budget is a statement of the financial affairs of the nation, and it can be divided into three general divisions. It provides for expenditure on services that are essential in any organized community ; it recognizes the community's responsibility to help people who are unable to help themselves; and lastly, it provides for funds to permit the Government to take such action as it considers fit to regulate the economy of the country. A responsible Parliament should consider the budget as a whole and not piecemeal. Undue emphasis should not be placed on certain of its aspects, with no consideration being given to other aspects. The honorable member for Phillip **(Mr. Fitzgerald)** expressed his views on the budget with more tolerance and reason than are usually exhibited by honorable gentleman opposite. He referred to discord at the recent conference of Commonwealth and State Ministers. Any discord that might have made itself apparent at that conference was due to the deliberate policy of the Chifley Government - a policy of divide and rule. If the Chifley Government wished to be true to Labour principles then its policy .had to be a policy directed towards the advancement of Labour's objective of the unification of Australia by the abolition of State governments. Difficulties between the States were brought into being during eight years of Labour rule, when Labour administrations had opportunities to establish the conditions that would advance Labour's policy. The general tenor of the debate illustrates the wisdom of the ' proposal, mentioned in the budget, to establish a Public Accounts Committee. Few people will deny that most honorable gentlemen who have spoken on the budget have tended to over-emphasize items that are in themselves relatively unimportant when regarded in relation to the general problems dealt with in the budget. One honorable gentleman last night eloquently discussed for a quarter of an hour the subject of lipsticks. However important that subject may be, it is not the most important in the budget. {: #subdebate-26-0-s3 .speaker-K8B} ##### Mr CURTIN: -- Tell that to the business girl- {: .speaker-KCD} ##### Mr DAVIS: -- I confess that I have not the knowledge of cosmetics and of the people who use them that has been displayed by the honorable member for Watson **(Mr. Curtin).** The standard of debate during the last few days has illustrated the truth of the statement that was made in 1913 when the Public Accounts Committee was first constituted. That statement was to the effect that it was difficult for members of the Parliament to cover the whole scope of government accounts, to examine them as they should be examined. The committee was remodelled and its functions were amended in 1920, and it was abolished in 1932 on the ground of economy. The Public Accounts Committee system is common to most of the English-speaking countries in the world. Great Britain, South Africa, Canada and New Zealand, at least, have the equivalent of such a committee. The purpose of such committees is to examine the Government's accounts and to report in general terms to the Parliament on particular items that .may bc referred to it. I suggest that the establishment of such a committee might well bc considered on a non-party basis. It is obvious that a consideration of important accounts, perhaps away from the atmosphere of the Parliament itself, would be of benefit to the people, irrespective of what attitude different political parties might adopt towards each other in connexion with other political questions. The Public Service has been, and always is, the subject of a great deal of discussion in the Parliament, and will no doubt continue to be so while it exists. Honorable members frequently have much to say about its standards, the number of its employees and its functions. Prom time to time I have heard honorable members express .themselves both fluently and forcefully on those subjects. The budget approaches the problem of the Public Service in a reasonable way. It indicates that a committee has been established to overhaul the administration of the various departments. As a result of the work of that committee three departments have already been abolished, whilst efficiency has been increased and expenditure reduced in some departments. The Prime Minister **(Mr. Menzies)** indicated this week that a suggestion for the holding of a conference between the States and the Commonwealth to avoid overlapping of government activities and to arrange some form of governmental co-operation, may be acceptable to both the States and Commonwealth. Provision is also made in the budget for an increase of superannuation payments for Commonwealth public servants. That provision is a recognition of the changed circumstances of to-day. Indeed, the budget makes a very reasonable and balanced approach to that matter. I turn now to the amounts provided in the Estimates for the administration of the Postal Department. An amount of about £12,000,000 is to be provided for Postal Department services. Total expenditure by the Postal Department is estimated at about £76,000,000 as against last year's actual expenditure of about £64,000,000. Those are vast figures, but we should remember that there is no honorable member who has not been constantly appealed to for assistance in the presentation to the Postmaster-General of a case for the installation of one or other of the facilities that are provided by the Postal Department. All government, departments face problems in supplying services to meet the increased public demand for amenities and facilities that has become apparent in the last few years. I understand that in Victoria the requests for new telephones this year are nearly 100 per cent, greater than they were only a few years ago. I am subject to correction in respect of those figures, but I am sure that the percentage increase is ' certainly more than 50. We have te __'y, as representatives of the people, to reconcile two essentially conflicting needs. One is the need for the most rigid economy, and the other is the need to provide all the services that the people themselves demand and are willing to pay for. The Government has acted as a democratic government should act, by recognizing the desire of the people for more facilities such as telephones, post offices and other necessities. Quite rightly the people must pay for such services, and we, as representatives of the people, have the responsibility of ensuring that the services shall be paid for. Some honorable members have criticized the proposed expenditure on defence on the ground that it will have an inflationary effect. But the Government proposes only that this country shall meet the needs of . the day by improving its defences. The estimated expenditure on defence is £79,000,000 more than last year's actual expenditure. The budget makes the wise provision of £50,000,000 for expenditure on the storage of defence equipment. It also provides for an increase of war pensions and service pensions at a cost of about £6,000,000 in a full year. It provides for the payment of war gratuities amounting to about £67,000,000. ' Those are all items that the people themselves have demanded should be included in the budget. The only really valid criticism that I have heard of the proposed expenditure on defence came from the Leader of the Opposition **(Mr. Chifley),** who, if I understood him correctly, contended that the next war would be a push-button war, and that our proposed expenditure on defence would prove to have been wasted. I do not think that that criticism is up to the general standard of criticism that is usually offered by the right honorable gentleman. Despite the charges that were made by the honorable member for "West Sydney it seems to me that the Government has recognized, on behalf of the whole community, its responsibility to those who cannot provide for themselves and, in almost al] cases, there has been an increase of allowances and pensions. The honorable member for Phillip made a useful contribution to the debate when he suggested that the Government might consider increasing the amount of the permissible income of pensioners. As a result of discussions that I have had with many persons who are in receipt of pensions, I think that if the Government increased the amount of permissible income it would help to overcome many cases of hardship. In this country, more than in others, the proportion of elderly people in the. community increases each year. If the Government can help these people to help themselves it will give to them the greatest help that could be given to anybody. Basically, this country's problem is one of unsatisfied demand that results from shortage of power, transport, housing, consumer goods and the products of our basic industries. A world shortage of basic materials is reflecting itself in world inflation which affects the economy of this country irrespective of what shade of political opinion may be represented oh the Government benches. The situation in this country is a little worse than in others because it has a legacy that was left behind by the Chifley Government. I do not accuse the Leader of the Opposition or his Government of lack of capacity or maladministration but I do say that their policy was directed towards laying the foundations of socialism. In laying that socialistic foundation the Chifley Government banked up the inflationary forces over two or three years and to-day this country is experiencing a great inflationary pressure which would not have existed had the objective of that Government not been, ultimately, to achieve a state of socialization. Honorable member? recall that the Leader of the Opposition, when speaking on this measure, said that his Government had redeemed treasury-bills to a large amount. It redeemed those bills in the ordinary course of events with money that it had received for social servicesI do not challenge that action. The social services reserve was expressed by investments in treasury-bills. In the year ending June, 1948, about £70,000,000 worth of treasury-bills was redeemed; in the year ending June, 1949, £85,000,000 worth of treasury-bills was redeemed. In. other words, in the two years after the war £155,000,000 worth of treasury-bills was redeemed. It does not seem to be coincidental that the reserve for social services was £120,000,000 and that the reserve provided to meet war gratuities was £30,000,000. In other words, the reserves amounted to £150,000,000 which was expressed in terms of treasury-bills that, during those two years, were withdrawn from the economy of the country and acted as a deflationary influence. In the present year that £150,000,000, or such proportion of it as will be utilized, will increase the inflationary situation. About £30,000,000 was shown in the accounts of the Commonwealth as a reserve allocation for war gratuities and this meant, in fact, that the Government was committed to the payment of £30,000,000 this year. The Postmaster-General's Department, the Commonwealth Bank, social services, repatriation benefits, war gratuities - expenditure in respect of all these items is above the normal budgetary requirements of this country. If honorable members of the Opposition consider that this is an extravagant budget, I suggest that they attempt to analyse the figures and point out where expense could have been avoided. In " cold fact "-the term used by -the Leader of the Opposition - many of the Government's problems, if not all of them, spring from the shortage of basic production. They spring from the fact that Australia is not producing enough black coal to meet the demands of its economy. It was estimated recently that, during the current year, Australia would fall behind its estimated requirements of: black coal by about 3,500,000 tons. That shortage is reflected, I remind the honorable member for West Sydney, in the insufficient number of houses that have been built. No government can build houses out of thin air. No government can use steel that has not been produced. The honorable member for West Sydney referred to the inflationary effect of immigration. That is a state of affairs which must be accepted, and to suggest that this Government is responsible for the degree of inflation due to the influx of about 200,000 migrants is to ignore statements that have been made by honorable members of the Opposition themselves. The honorable member for Melbourne **(Mr. Calwell)** expressed himself clearly on this matter quite recently. The honorable member for West Sydney agreed that it was necessary to maintain a high immigration influx. If that is so, do not let us quibble. Let us face the fact that immigration on that scale brings in its train inflationary forces. The condition of this country's transport services is one of the causes of inflation that is frequently overlooked. In the budget, provision has been made for £1.2,000.000 to be granted to the States n under the Commonwealth Aid Roads and Work? grant. In the financial year 1947-4S the amount allocated by the Government to the States was £6,300,000. Last year it rose to £9,267,000. It is estimated that, in the current year, £12,000.000 will be allocated to the States. For the first time, the amount allocated has been linked, with petrol consumption. That is a realistic approach to the matter. Whilst this country's basic problem remains a shortage of man-power it is also faced with a shortage of machinery. lu country areas the main problem in road maintenance and construction is not, in the first place, a shortage of man-power, but a shortage of machinery. In this budget it is proposed, for the first time, that grants for road-making machinery shall be available to local authorities. A review of the budget as a whole and not as a collection of isolated legislative acts leads to the conclusion that it is a reasonable budget, which provides, as far as the Government can do so, for the welfare of all sections of the community. As far as it can, the Government has provided for real and practical deflationary measures to be taken against the inflationary crisis. *Silting suspended from 5.58 to S p.m.* {: #subdebate-26-0-s4 .speaker-JUP} ##### Mr CLAREY:
Bendigo .- In the debate that has taken place in connexion with the budget the matter of the inflationary spiral that is being experienced at present in Australia has been discussed at length. I suggest that there are three dominant factors in the present inflationary spiral which should have our consideration. The first is the high purchasing power of the community, which results from two reasons: the existence of full employment with its concomitant regular income for the whole of the community; and the very high prices received for many of our exported products. The second factor is intense capital development, which is making a big demand on the resources of the community. The third factor is the shortage of labour. The first two factors are causing an unprecedented demand for goods and services whilst the third factor is aggravating the existing shortages of materials and supplies. With all three factors operating together certain economic problems have come into existence. Those problems by and of themselves are not economically evil, but in combination they can cause economic chaos unless they are properly understood and the proper action is taken in order to minimize their evil effects. It lias been stressed in this debate that these difficulties can be met by increased productivity. It is in regard to that matter that I wish to address the committee to-day. So many goods are required that the call for greater production becomes imperative. I associate myself with the appeal made by the president of the Australian Council of Trades Unions, **Mr. A.** E. Monk, in regard to greater production in Australia. I do that because while I was president of the Australian Council of Trades Unions, on more than one occasion I urged greater production, not only for the maintenance but also for the improvement of our living standards. I am inclined to the view that in some quarters a totally wrong conception has arisen about what is meant by greater production. There seems to be a belief that it means that the worker must work harder and longer. I think that the note struck by the honorable member for Indi **(Mr. Bostock)** rings true. He said that what is needed is more efficient work. Efficient work doe9 not depend entirely upon the employee. Prom the employee's standpoint efficiency in his job is most desirable, and almost all workers strive to achieve it. The efficient working of industry depends upon many of the factors involved in management. The most efficient employee, unless he is working under efficient management and proper supervision, and unless constant supplies of raw materials and power are always available, is unable to do efficient work. "When consideration is given to the whole subject of greater productivity in Australia, one finds that it is dependent upon three factors. Those factors are governments, employers and workers. It has been alleged that the worker is not playing his full part in industry. I repudiate that allegation, and submit that it is not only untrue but also harmful. The worker in industry has the pace set for him by the machine. In fact the worker, playing his part in production by tending the machine efficiently, is giving the service required of him by industry. Never let it be thought that by hard work on the part of the employee any problem in connexion with production has ever been solved. I point out to honorable members something that perhaps everybody knows, that is that for hundreds of years mankind made, little material progress because the only things that they could procure to supply their needs were the things that could be made by hand. For many centuries the only aids that man had for the satisfaction of his needs were the power of the domestic animal, water power and wind power. Because man's capacity to produce was limited by the power of his own hands together with the aids that I have mentioned, for centuries no progress was made. Once power was harnessed to machines the productive capacity of the human race increased enormously. One has only to peruse the records of production for the 150 years to see what great expansion and what enormous production have taken place, and how we have been able to make conditions of life better because we have had powerful assistance in our work. Therefore, in dealing with this matter of the necessity for increasing productivity, and labour's part in it, we must consider the methods of present-day production as well as the economic conditions of the times, and try to understand what is involved in securing better results from both human labour and the machinery that human beings tend. I suppose that the best definition of productivity or of production by the worker, is that given in the report of the Director-General of the International Labour Office to the 33rd session of the Internationa] Labour Conference held in Geneva, in 1950. I think that the words used in this report very closely indicate the responsibilities which fall upon the whole of the community, and particularly upon those who not only work in but also are the managers of industry and have to face important tasks. On page 77 of the report we find this passage - To say that the average man must produce more wealth is not the same thing as to say that he must work harder. Harder and more regular work may be - and often is - one of the things that is required; but in very many jobs the worker's output depends more upon tools, methods of operation, managerial performance, plant morale and operating conditions than upon his own personal application. Nor does higher productivity mean increased production at any cost. Higher productivity means, in the most general terms, an increase in the ratio of the output of wealth (goods and services) to the corresponding input of labour - an increase in the production of wealth per unit of labour. As a simple illustration I shall cite again to the committee certain figures that I cited a fortnight ago in regard to the volume of production per person engaged in rural industries. It is well known that in the last ten years there has been an increased use of machinery in rural industries and an increased utilization of the fullest information in regard to technical and other problems associated with rural production. From 193S-39 to 1948-49 the volume of labour employed fell by 13£ per cent, and the actual production per person increased by 26 per cent. Obviously that increase could not have been achieved merely by human labour alone and that other factors have operated. In this matter of effecting an increase of production certain problems are involved which must be solved. Unless we can understand the nature of those problems and see clearly some of the steps that must be taken to solve them, we shall be fooling ourselves by believing that an increase of production can be readily obtained in this country and in consequence our economic ilk can be cured. I point out to the committee that prior to the outbreak of World War II. industry in Australia, and in every other country, was not geared to meet the full requirements of the people under conditions of full employment. I hope to give illustrations later to substantiate that. In fact, industry was geared to supply about 80 per cent., or a little more, of the things needed by the community. That arose from the fact that we had a constant group of unemployed of roughly 10 per cent., and that most of those engaged in industry never knew when they would be unemployed.. There was consequently a tendency on the part of the workers not to spend all that they earned, but to put by something for a rainy day. Nowadays without insecurity, psychological and real, to affect the' purchasing power of the community and to act as a brake upon production, there are not enough goods to go round. Conditions to-day are different from those that existed before the war, and when we start on this tremendous task of trying to overcome shortages that have arisen in consequence of a world war, and to increase the supply of goods and services, we begin with the economic machine, which in itself is not efficient, because it was never geared to the task of providing all the people with those things that were necessary to make their lives happy and contented. In the last eight years certain things have happened which may make the task of rehabilitation very difficult. For four out of five years there was a reduction of capital expansion, a cutting down to the minimum of the civilian needs of the community and at the same time the development of full employment. We have now had five years of full employment, and industry is making gigantic efforts to overtake the accumulated shortages and at the same time to supply the vastly increased needs of the community. More efficient machines are required to increase production in essential industries whilst those already available must be operated more efficiently. However, when we tackle that problem we find ourselves up against a very difficult situation. Industries that existed before the recent war were considerably stimulated as a result of war conditions. In many instances they expanded beyond the limits that were contemplated by those who had established them, and because they have not been able to obtain sufficient land and factory space to meet their requirements their efficiency has suffered. To-day, industry urgently requires three things, namely, more buildings, more machinery and more power. In order to provide the additional buildings more space is required. During the last 30 years, all progressive undertakings have built to a plan that would enable them to cut down unnecessary effort to a minimum. The ideal factory is one in which the raw material is received at one end and after passing through successive processes comes out at the other end in the form of the manufactured article. For instance, the Shepparton Fruit Preserving Company Limited, which is a wellknown concern in Victoria, was established about 1918 on a plan under which its founders took advantage of experience that had been gained in the United States of America. They built a small factory with the idea that the raw material would be received at one end and, going through successive processes, would emerge at the warehouse at the other end ready for despatch. The founders of that company were fortunate in that at that time they were able to obtain all the land that they required. To-day, the factory is twenty times as large as the original building.. That company was able to apply the ideal method of production right throughout its factory. However, many efficient businesses that are anxious to follow its example are frustrated because of the economic conditions that have developed during the last few years. In addition to the problem of capital expansion and the development of our productive resources we are up against a very urgent social problem in the shortage of housing. An industry cannot expand if sufficient housing is not available for the labour that it requires. Thus, right at the start of this problem, we find one reason why industry is unable to develop the most efficient methods of production. In addition, the very great acceleration and stimulation of Australian industry that took place between 1940 and 1945 has upset all calculations with respect to our requirements of basic raw materials. I cite, for instance, the shortage of power. In Victoria, the State Electricity Commission which, I believe, all honorable members will admit efficiently conducts a well-planned undertaking, exercised great foresight before the recent war by drawing up a plan of expansion based on the normal rate of industrial expansion. However, during the five years of war the expansion that took place in Victoria, particularly in industries engaged in the production of war material, caused a development that would not have taken place under normal conditions for another 20, or 25 years. Consequently, despite the careful planning of the State Electricity Commission it is not able at present to meet all the power requirements of industry in Victoria. For that reason the Kiewa River project and other power projects are being undertaken whilst the Snowy Mountains scheme is being accelerated. The second problem in connexion with production .is the shortage of labour. Industry cannot expand at the rate that is required because it cannot obtain adequate materials, and the shortage of materials is due largely to the problem of providing sufficient labour. When labour is in short supply, it naturally tends to go to industries that it finds to he the most attractive. The great expansion that occurred in industry generally under war conditions has given rise to a much greater demand for coal than would normally be the case. The coal-mining industry is not attractive to labour. Indeed, it is losing labour, and that shortage is becoming increasingly more serious. Industry also urgently requires a greater production of bricks, but the brick-making industry is not attractive to labour. ' In fact, it has not yet equalled the production of bricks that was recorded in 1939. The shortage of labour frustrates our efforts to increase production. At the time at my disposal I shall touch briefly on some problems that must be faced in order to increase the productivity of labour. Shortages of goods and services cause hardship, discomfort and inconvenience. They prevent natural economic expansion and they make life more difficult for every one in the community. I shall refer to some of the factors that we must examine if we are to solve this problem. First, the turnover of labour is twice as great in Australia as in the United States of America and the United Kingdom. There is an urgent need for training within industry. This system of internal training has been carried on with great success in the United States of America and the United Kingdom. Its extension to Australia might well be investigated by the Department of Labour and National Service. Next, we must allocate our resources between industries and occupations. One reason for the present falling off of productivity in some industries is that they cannot obtain sufficient raw material to enable them to keep their machines constantly in operation. When machines are idle production is lost, and that loss tends to increase the hardships of the community. Industry must also make the requisite organizational and administrative changes in order to enable it to produce to the maximum of its capacity. Every industry tries to achieve that objective, but in existing circumstances very few of them succeed. That is another matter that the Department of Labour and National Service should investigate. We must also consider the allocation of capital to those industries that are essential to Australia's economic welfare. They should be given first call upon any capital that is available for investment. Frequently, industries do not develop full technical efficiency although, in many instances, machines that are idle could be put into operation by making a slight adjustment. Much potential production is lost for that reason. Next, we must establish efficient apprenticeship and vocational training systems in order to make available to industry an adequate pool of well-trained technical craftsmen. I give full credit to the Minister for Labour and National Service **(Mr. Holt)** for his recent announcement that the Government will investigate the apprenticeship problem as a whole in order to obtain the best results. The trade union movement requested the Minister to act in that direction, and he has agreed to do so. Other matters that call for urgent attention are the standardization of plant, the provision of adequate standards of safety and health, and the development of a scheme whereby an industry as a whole will benefit from the technical progress that is made in any section of it. Those matters are of very great importance. When I visited the United States of America during the recent war, I inspected the Packard plant at Detroit-. That undertaking operates a system under which every technical improvement that is either developed or evolved within it is immediately circulated among all other branches of the industry throughout the United States of America. No effort is made in Australia to pass on details of technical advancement to all branches of an industry. Whenever improvements are made in methods of production, they should be made known to industry as a whole. Only in that way can our economy benefit from such progress. In conclusion, I emphasize that if industry is serious about increasing its productivity it must have the will to strive towards that objective. The three elements in industry must co-operate in order to ensure that all available machinery shall be utilized to the maximum degree. Undoubtedly, the need for greater production is pressing, but production cannot be increased overnight. That task involves planning and co-operation. I am confident that if the Government attacks this problem from a practical stand-point by thoroughly investigating all aspects of it and calling upon the three elements in industry to accept their responsibilities and put their shoulder to the wheel, it will succeed in overtaking existing shortages of goods and services. {: #subdebate-26-0-s5 .speaker-JPA} ##### Mr BERRY:
Griffith .- First of all, I shall comment briefly on some of the statements that were made by the honorable member for Bendigo **(Mr. Clarey).** I agreed with the honorable gentleman when he said that conditions in industry to-day were entirely different from those of eight years ago. I submit to members of the Opposition that conditions ought to be vastly different. During the last few days we have heard a great deal of criticism of the recent dollar loan. One of the principal purposes of that transaction is the improvement of the nation's industrial capacity and the conditions of the workers in industry. Members of the Opposition who criticize the Government for trying to improve the lot c.f the workers are mere hypocrites. The electorate that I represent includes one of the most highly industrialized areas in Australia. The shipbuilding yards constitute the only heavy industry, but there are many light industries as well. I have visited every one of those industries and I have seen the men at work in them, every man doing his job as it should be done. I agree that industrial workers in Australia are not provided with the best modern machinery and equipment. I sympathize with the man who has to use second-rate and out-of-date machinery. One of the fruits of the dollar loan will be the introduction of modern and efficient factory equipment, which will benefit working men and women. The honorable member for Bendigo, who is one of the most moderate and least splenetic members of the Opposition, said that Victoria's industrial potential is handicapped by a shortage of power. I tully agree with that statement. The whole of Australia, and Victoria in particular, suffers from a shortage of coal, and consequently an inadequate supply of power. However, the honorable gentleman did not point out that Queensland has plenty of coal. If the Premier of that State, which has had a Labour administration for the last 30 years- {: .speaker-KJQ} ##### Mr James: -- That is why Queensland is so prosperous. {: .speaker-JPA} ##### Mr BERRY: -- I shall invite the honorable member to visit that State some time. He will change his mind when he sees what conditions there are like. We have more coal in Queensland than we know what to do with. Our trouble is that, although we can produce an abundance of. coal, we cannot transport it to the wharfs. Some time ago the " MacCain " Government in Victoria offered to supply steel rails to Queensland so that a railway line could be constructed to transport its coal to the seaboard. The Queensland Premier, **Mr. Hanlon,** chose an expert who went to Victoria and reported that the rails that had been offered were not good enough for the Queensland railways. Yet the *Spirit of Progress* was able to travel over some of those rails which should have been used to provide tracks over which coal could have been transported from Blair Athol and Callide to Gladstone. When prospective customers receive that sort of treatment from the Queensland Government, one can scarcely blame them for going elsewhere to buy coal. I compliment the Treasurer **(Mr. Fadden)** upon the budget. I do not say that it is faultless, but its shortcomings, such as they are, are attributable to the mismanagement of the country's affairs by the Chifley Government. This Government should not have had to undertake the task of rectifying those faults five years after the end of World War II. The outstanding feature of the budget, and of all financial measures to-day, is the inflation that they reflect. That feature is noticeable also in the budgets that have been presented to State parliaments in recent weeks. Money has lost much of the purchasing power that it had a few years ago. Consequently, every govern ment must make provision in its financial plans to counteract the growing effect of inflation. The blame for this state of affairs does not rest entirely upon the Chifley Government, the remnants of which now sit in Opposition, but the present unfortunate condition of our economy could at least have been mitigated by prompt and intelligent action on the part of that administration. When inflation began to rear itself in .1947, the socialists had the greatest opportunity in history to make a full-blooded, honesttoGod, adventurous effort to prevent it from spreading. But instead, they decided that they had a golden opportunity to put into operation their longcherised dream of socialism. The Chifley Government had the people completely under its thumb. The exercise of war-time and post-war controls had given almost unlimited power to the politicians. Only the fact that the people placed this Government in office hindered the Labour party from giving full effect to its socialist plans. The nation is still suffering from the ills of socialism and the inflation that it caused. The Chifley Government was not concerned about balancing its budget. It merely issued treasury-bills. Members of the Opposition have claimed repeatedly during the last few days that the Labour Government did not borrow. But, if the issuing of treasury-bills does not constitute borrowing, I do not know the meaning of the term! A treasury-bill is neither more nor less than an I 0 U. Our debts have been increased to the tune of the hundreds of millions of pounds that were squandered by the Chifley Administration in an attempt to stop the leaks in iti. budgets. {: .speaker-KYC} ##### Mr Pollard: -- Now this Government is going to rob the wool-growers. {: .speaker-JPA} ##### Mr BERRY: -- From the time when I first entered this Parliament until recently I heard from members of the Opposition a continual tirade of abuse of the Australian Country party and the people whom it represents. Honorable members opposite did not seem to have one good word to say about the primary producers until they thought that they could capitalize on what they falsely call the Government's " wool tax " proposal, which, in fact, is merely an extension of the " pay as you earn " system that applies to every factory girl and every man on the 1 basic wage - a system that was introduced by the Labour party. Many people believe that prices are going to return to the levels that prevailed in 1939, but they are destined to suffer a rude shock. I certainly hope that prices will never return to the 1939 levels, because, if they fall to that degree, we shall be overtaken by an economic recession or depression and wages will come down, bringing the standard of living of the average man and woman down with them. The Opposition claims that it represents the interests of the average man and woman, but its attitude towards the national economy does not encourage belief in the sincerity of the boast. The ."job that lies ahead of this Government is to stabilize prices so that our currency will regain its proper value in relation to goods and services. That job was sadly neglected by the Chifley Government. I maintain that prices will remain stationary. Honorable members may ask how that result can be achieved. The answer to their inquiry is that the most effective method of restoring value to our money is to increase production. I know that Opposition members pretend that the Government's policy may be sumimed up in the words, " sweat the worker ". I have heard that statement so many times that I am sick of it. No one intends to sweat the worker. I believe that the introduction of incentive payments will lead to an increase of production, and will " make " this country in every way. The honorable member for Brisbane **(Mr. George Lawson)** will vouch for the fact that the system of incentive payments has operated with marked success in the business of **Mr. Bruce** Pie, who was at one time the leader of the Liberal party in Queensland and is still a member of the Parliament of that State. Possibly some Opposition members will describe him as a financial tycoon. That word is often bandied about this chamber. However, the system of incentive payments was introduced in his factories many years ago, and he has never had any industrial trouble. I suppose that he has approximately 1,000 employees, but his production has never declined and he has never " sweated " a worker. I read in to-day's issue of the *Courier-Mail* the following news items : - >A Brisbane employer is launching a f 200,000 scheme to provide 100 homed for his employees. He is **Mr. Bruce** Pie, M.L.A. for Kedron, who said last night that thu houses would be built by a contractor on about 20 acres of land. > >They would be available for purchase by all employees : at his Kedron mill. On the sporting fields, men of the same type as those who work in our factories give of their best to clip one-quarter of a second off the record for the 100 yards sprint. They exert all their strength and powers on the football field. In all kinds of sport, men and women strive to win. Why? The explanation is that they have an incentive, perhaps a silver cup or some other trophy. They respect the captain of their team, and will not let him down. But there are bad captains in many of the trade unions, who encourage the members of those organizations not to give of their best, as they would willingly do if they had an incentive to work for. Whether or not Opposition members realize and admit the fact, the day will come when incentive payments and profit sharing will be in operation throughout the great factories in Australia. I know that some members of the Labour party are opposed to that system, and I cannot understand their attitude. The suppression of endeavour is not known on our sporting fields. Why should it be known in our factories ? We must have a balanced economy; otherwise, we shall always have inflationary conditions and high prices out of all proportion to the wages that the working men and women, who are the backbone of this country, receive. I was most interested in the speech by the honorable member for Gellibrand **(Mr. Mullens),** and I consider that he made some constructive suggestions. He described some of the people of Sydney and Melbourne as " poor, disgruntled persons looking out of the windows of their sub-standard homes with a blank expression on their faces when they saw other persons walking by". That statement should not give rise to laughter. It is serious, and I agree with it. But who is to blame for those conditions? Did the honorable member blame the Menzies Government, which has been in office for only ten months? Did he blame the socialists, the Chifley Administration, who were in power for eight years? Did he blame the Labour party in Victoria, which was in office in that State for many years? Did he blame the McGirr Labour Government in New .South Wales ? I know that there are sub-standard homes in Sydney and Melbourne. When I have been driving through the electorate of East Sydney, the thought has occurred to me, " If that is the best that the honorable member for East Sydney **(Mr. Ward)** can do for his constituents, why in the devil do they continue to elect him to the Parliament? " Honorable members may be astonished to learn that after 30 years of almost continuous administration by Labour governments, there are sub-standard homes in Queensland. The policy of the Hanlon Government is to provide, not houses, but housing camps. Have honorable members been through those establishments? I do not think that they have seen them. But the sight of the poor, unfortunate people who live in them makes an indelible impression on a visitor's mind. The housing camps are virtually the buildings that were vacated by the American and the Australian armies. The Premier of Queensland, Ned Hanlon, has even seen fit to erect a school in the housing camp at Holland Park, and no fewer than 600 children attend it. It is a standing disgrace to the administration of the Queensland Government that it can do no more for young married people than herd them together, as *is* done in Russia, in camps or community centres. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- What does the honorable member know about Russia? {: .speaker-JPA} ##### Mr BERRY: -- I have listened to Ernie Thornton, the former president of the Federated Ironworkers Union. If those housing camps are not a breeding ground for communism, I do not know under what conditions the seeds of communism germinate. The Labour Government in Queensland believes that the lower the standard of the working people can be reduced, the more likely will they be to vote for the Labour party. That idea has been fostered from time to time by insidious propaganda. My time is almost expired- Opposition Members. - Hear, hear ! {: .speaker-JPA} ##### Mr BERRY: -- Of course Opposition members cannot " take it ". I should like to refer briefly to our defence policy. I know that the Labour party does not believe in defending this country, yet the Senate and the House of Representatives agreed without a dissentient voice to the despatch of Australian servicemen to support the United Nations action against the Communist aggressors in Korea. But the Labour party declares that we do not need an army to protect our own country. The national' service scheme cannot be introduced toosoon. When I make that statement- {: .speaker-K8B} ##### Mr Curtin: -- Does the honorablemember believe in conscription? {: .speaker-JPA} ##### Mr BERRY: -- I almost anticipated that interjection, because I was about to say that I have two sons who will be in the first call-up under the national service scheme. Does any honorablemember think that I want them to go towar? Does any one believe that I want the sons of any other person to go to war ? Of course, I do not ! No one in his senses would entertain such thoughts for a moment. But if my sons have to fight for their country, as they will in an emergency, I want them to he thoroughly trained, not only to wreak some destruction on the enemy who is invading our shores, but also to protect themselves. In other emergencies when untrained troopswere sent from Australia, thousands of them were killed, because they had not been taught the fundamental principlesof self -protection. I emphasize to thiscommittee and to the people that we need a national service scheme. Every oneshould be trained, not because Australia is a potential aggressor, but to defend this country. It would be ludicrous to say that Australia would ever be an aggressor nation, but we must be able toprotect ourselves. Whilst the socialists agreed unanimously to the action of the Government in sending Australian troopsto Korea, they say, " Do not touch thefifth column within Australia. Let them, like rats, eat our defences to the ground."' If action is not taken in the near future,, om- defences will be undermined by fifth columnists. Opposition members professto represent the working class. Some of them have held office in the trade unionsOne of their number is now absent from: the Parliament, supervising a strike of railway workers. He is conducting it against his fellow trade unionists. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Is he a Communist? {: #subdebate-26-0-s6 .speaker-JPA} ##### Mr BERRY:
GRIFFITH, QUEENSLAND · LP -- I do not know. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Why does not the Government declare him? {: .speaker-JPA} ##### Mr BERRY: -- The honorable member for Hindmarsh **(Mr. Clyde Cameron),** out of his own mouth, will declare some one if he talks for long enough. An Opposition member is conducting a campaign against his fellow unionists. {: .speaker-KYC} ##### Mr Pollard: -- Nothing of the kind. {: .speaker-JPA} ##### Mr BERRY: -- Of course, he is! Who has to walk to work because the transport employees are on strike? It is the wage-earner, who cannot afford to hire a taxi or who does not own his own motor car. Honorable members should not think that I believe that the representatives of trade unions have the interests of trade unionists at heart. After all, the trade union official is often a man who lives on the bounty of his fellow workers. I am thinking of the type of union official who will hound a girl in a factory for her union dues of 2s. 6d. to enable the union to fight a strike in another State or perhu ps to fight a political election campaign. {: #subdebate-26-0-s7 .speaker-JRJ} ##### The TEMPORARY CHAIRMAN (Mr Bowden:
GIPPSLAND, VICTORIA -- Order! The honorable member's time has expired. {: #subdebate-26-0-s8 .speaker-KX7} ##### Mr WARD:
East Sydney .- The more one examines the present budget the more certain one becomes that the country is facing a dim future. The only bright spot is that at an early date the people may have an opportunity to pass judgment on the Government. If that happens we are quite convinced that the people will again change their government and will return Labour to office once more. It is remarkable how Government supporters who have taken part in this debate have introduced all kinds of subjects in order to get away from the one that concerns the people of Australia more than does any other. The people of Australia want to know definitely when the Government intends to commence to give effect to its promise to bring value back to the £1. That is the question which every one is asking himself to-day. Yet speaker after speaker amongst honorable members opposite has attempted to avoid answering it. I have noticed that some of them have attempted to avoid it by saying that the rate of increase of prices has been no greater under an anti-Labour administration than it was under Labour's administration. One honorable member mentioned the " C " series index, and said that the workers of this country accepted that index as a proper basis on which to assess the cost of living in this country. That is the first time that I have heard it suggested that the workers of this country are satisfied with the procedure followed in the fixation of the basic wage. The Commonwealth Statistician's figures, from which the " C " series index i.« compiled, do not tell the whole story, a3 the Australian housewife knows. The data from which the 'Commonwealth Statistician compiles his returns is obtained from information furnished to him by various manufacturing and commercial concerns, and that information is treated by the department as being absolutely confidential. We do not even know the identity of the business firms who supply the data on which the official statistics are based, nor do we know the sort of material that they supply. However, I venture to say that no commercial enterprise in this country will sell goods to the workers at the cost price which they set out in the returns that they furnish to the Commonwealth Statistician. We know that those returns will not stand a close examination or check of any kind. The real test of whether the cost of living is getting out of hand is supplied by the reaction of the average Australian housewife to the present, prices of commodities. The. opinion she holds is formed as the result of her every-day experience of the cost of living which has risen so greatly under this anti-Labour Government. For confirmation of the extraordinary increase of prices I refer honorable members opposite to the statements that have been made in the daily press lately about the cost of living. All honorable members know that those newspapers with few exceptions are not sympathetic to Labour and that they would not be likely to put the case for Labour in its true light before the people. However, even the press cannot refrain from criticizing the administration of the present Government. I shall not read a great number of these newspaper headline comments, but the following are a fair sample : - >Housewives shy off record food prices'. > >Apples likely at ls. 4d. each. > >Pensioner of 78 scrubs to exist. > >High food prices cause starvation in Sydney. > >Children suffer, say cleric. > >Record food prices; Housewives, angry protest. > >Green peas Jd. a pod. > >High costs make wives take jobs. > >Fancy such conditions obtaining in a country like Australia, which produces such an abundance of foodstuffs ! > >I have heard honorable members opposite endeavour to claim that the Prime Minister **(Mr. Menzies)** did not promise during the last general election campaign to put value back into the £1, and they have challenged members of the Opposition to prove that he did make such a promise. I shall read an advertisement which appeared in the press over the authority of **Mr. Cleland,** who was at that time Secretary of the Liberal party. Under the heading " Chifley Government's fake excuse for high prices exposed by actual facts " it states - > >The Federal Labour Government is entirely to blame for the present extortionate cost of living and for the fact that prices have steadily increased since the Chifley Government " controlled" them. No faked excuse will convince Australia to the contrary. > >The Liberal .party, as soon as returned, will take prompt steps along essentially practical lines to remedy the present disastrous position, and will, bv the encouragement of incentives - increase production, stabilize and progressively reduce prices. > >That statement certainly contains no qualification of the Prime Minister's promise. During the last general election campaign members of the anti-Labour parties told the people that all they had to do was to eject the Labour Government and all their economic troubles would be rectified. It is interesting to note that prices first began to spiral rapidly from the day when effective prices control was ended following the decision given by the people at the referendum on the control of rents and prices. Honorable members opposite must accept responsibility for the defeat of that referendum. They told the people that the States could more effectively handle prices control, yet only to-day the Prime Minister undertook to confer with the States about tightening up prices control. The reason for the proposed conference is that it is now generally recognized that the States have been unable to institute effective control over prices. > >Of course, I remember when the antiLa'bour parties were bitterly opposed to prices control, and accused the previous Labour Government of wanting to regiment the nation and to destroy the individual liberty of the subject. I recall that only a few years ago, with the war going on, many honorable gentlemen who now sit opposite to me assured the workers that all they had to do was to put their best foot forward in order to win victory and then we should have a new order of society based on the principle of social and economic justice to all. Of course, they were also told that the new order would include certain controls. I shall read to honorable members a passage from an address delivered to a group of business men in Melbourne by the present Prime Minister on the 19th August, 1941, shortly before his Government was replaced by the Curtin Administration. This is what the right honorable gentleman said on that occasion - > >In the last two years you have seen the introduction of profits control and prices regulations. You have seen new departments of government lay their hands on private enterprise and .policies pursued which are designed to affect the cost of living and interest rates . . . > >I hope that none of you will imagine that these just and equitable things that have been done during the war will cease when peace has been won. > >He was referring to prices control. He continued - > >They will not. This country has been learning new things during the war - new things about human relations, the responsibilities of government, the responsibilities of those who are masters of men and who have capital to invest. > >Those things will not, I hope, come to an end when the war is ended. What we have been doing, however imperfectly, is laying the foundations of this New Order here and now, while the war is going on. > >Now I shall quote from one of the Liberal party's official pamphlets that was issued during the campaign which preceded the referendum on the control of rents and prices; it reads - Five Reasons Why You Can Safely Vote No. Though the Commonwealth actually controlled, nearly all prices were fixed on a State or regional basis. All States are ready and able to do a better job. Price control from Canberra has pushed up prices - encouraged a huge black market - caused unnecessary shortages of goods - placed the greatest burden upon the honest citizen. If honorable members opposite believe that the people still hold the same opinion of prices control that they held when the referendum was taken, why not give them another opportunity to express their opinion now that they have had the experience of State government control of prices? When honorable members opposite were fighting to protect the interests of their masters, the financial and banking institutions of this country, they were posing as the upholders of democracy. They said, " Let the people decide all these questions". I am not a believer in the infallibility of the so-called Gallup polls, but honorable members opposite are fond of citing the results of those polls from time to time. Let me tell them now of the result of one Gallup poll that was held recently, the results of which were published in the Sydney *Sun.* That poll indicated that at least 57 per cent, of the people were either in favour of a referendum being held on the subject of prices control or were in favour of that control being transferred immediately to the National Government. If that is the feeling of the people, why are honorable members opposite opposing them? Although prices control has been handed back to the States, there are many, things that the Government could do to improve the present position if it desired to do so. On Tuesday night the Prime Minister put up a great defence of the metal monopolists of this country, who, he said, made a great sacrifice in order to provide Australia with cheap metal. He referred to the fact that the .prices of certain metals had recently been increased by the States' prices Ministers. Of course, every one knows that the prices Ministers had no alternative because, if they had not been prepared to increase the price, Australia would have been denuded by the monopolists of essential metals. The prices demanded by the monopolists for zinc and lead have no relation to the cost of production. The wages paid to the workers in the metal industry have no real bearing on the present high cost of prices of the metals, which are the direct result of monopoly control and of a strong demand for metals overseas. A similar situation exists in relation to much of our primary produce. The Australian public ought not to be asked to pay higher prices for its needs merely because the exporters can get exorbitant prices overseas. The Australian consumers should not be asked to suffer because prices overseas have risen steeply. There should be some regulation of exports. Let us consider the position in relation to meat supplies. Is it not a fact that Australian housewives have for some time been paying exorbitant prices for Australian meat while great quantities of meat of superior quality have been exported overseas regardless of the requirements of the home market? The reason why the meat interests wanted to export the meat was that very high prices could be obtained for it overseas. Of course, the present Government will not take any action to remedy that state of affairs. Indeed it is powerless to take any such action because, if it attempted to do anything that might conflict with the interests of the wealthy pastoralists and industrialists who support it, they would withdraw their financial assistance. I shall say something now concerning another aspect of the budget proposals. I refer to the treatment of the woolgrowers. It may seem strange to those honorable members opposite who are attempting to interrupt the flow of my speech, but it is well known that, notwithstanding all the efforts of the Australian Country party to make the country people believe that the Labour party represents only metropolitan interests, almost every legislative act to assist country people has been introduced by a Labour administration. Furthermore, that legislation has invariably received the unanimous support of Labour members regardless of the constituencies which they represent. Although I represent a Sydney metropolitan constituency, I have sufficient sense of fairness to know that the Government's proposal to attack the wool-growers is neither fair nor equitable. I am not worried about the big graziers, because they are able to look after themselves, and they can exercise their influence with the present antiLabour Government. I am concerned about the small farmers, who, despite all that has been said concerning their favorable position, are not all enjoying prosperity. I was unaware of the real situation until recently, when a small sheep-farmer wrote to me and informed me that the insurance companies of this country will not issue flood insurance policies to farmers or graziers in territory that is subject to flooding. That means, of course, that the small farmer must bear his own losses. If his land is inundated during a flood and a considerable portion of his stock, fences and dwelling is washed away, he has to replace them from his own resources. That is why I am concerned about the " small man ", who must continue to raise sheep if the industry is to continue to prosper. It is interesting to speculate on the effects upon primary producers of the Government's proposal to levy a compulsory contribution from the woolgrowers. Already the wool-growers are paying into a Government fund for a stabilization scheme 7£ per cent, of the proceeds of the sale of their wool. In addition, they are now to be called upon to pay to the Government a compulsory contribution of 20 per cent, of the proceeds from the sale of their wool, which is supposed to represent a payment in advance of income tax. It is estimated that the proceeds of that compulsory contribution will bring in approximately £103,000,000 to the Treasury. What is the real purpose behind the Government's proposal? The small grazier who wrote to me informed me that in the last eighteen months he had been able, for the first time since he has been engaged in the industry, to discharge the mortgage on his land and stock. He informed me that many other small wool-growers have not yet reached that favorable position. He said that' because of the prosperity of primary industries to-day, many farmers and small graziers have been able to dischargetheir mortgages, which means, of course, that the country branches of the privatebanks are experiencing a decline of business. What will happen when the Government has withdrawn the estimated sum of £103,000,000 from the primary producers? Undoubtedly, it will deprive a large number of the less fortunately placed primary producers of the opportunity of discharging their indebtedness to theprivate banks. Many of them will not be able to repay their overdrafts, and. they will again find themselves placed' securely in the control of the banks. I have a very shrewd suspicion that the- private banks may have initiated thescheme now submitted by the Government. Therefore, I say that the membersof the Australian Country party in supporting this proposal are not lookingafter the interests of the people whom they are supposed to represent. Now assuming for a moment - and I accept the argument - that one way toassist in arresting inflation where there is an insufficiency of goods, is to drain off a quantity of the purchasing power that is in the hands of the people, I ask, whyselect the wool-grower alone for attention in that respect? Are there not other high income groups in this country? Why not increase the rate of income tax. on the earnings of the higher incomegroups if it is considered that too much money is circulating in the community and is causing prices to rise? That would be the most equitable and fair way of contracting spending power because it would mean that men on high incomes,, such as bookmakers, publicans, graziers,, wheat-farmers and so on would all be on exactly the same footing. There is nodoubt that the Government's action in relation to the proposal to withhold portion of the money received from the saleof wool discriminates against one section of the community. In any case, how can it be argued that it will assist in arresting inflation when the Government,, whilst withholding £103,000,000 from the wool-growers in order to prevent them from spending it, proposes to pay the- sum into Consolidated Revenue and to expend it? That seems to me to he a rather queer method of tackling inflation. I am not expressing the opinion of the Labour party only in relation to this matter. If Government supporters care to study the Finance Review published by the Sydney *Baily Telegraph* on the 17th October last, they will find in it an article by Professor S. J. Butlin, Dean of the Faculty of Economics at the University of Sydney, in which exactly the same opinion is expressed. The Government's action will hit the small woolgrower but will not vitally affect the big wool-grower. The Labour party is always concerned with assisting the small man because it recognizes that he is the person who must look to the Labour party for such assistance. I turn now to the sales tax proposals contained in the budget. It is interesting to note that whilst the gentleman who is now Treasurer **(Mr. Fadden)** promised the people at the last general election that taxes would be reduced in the event of the election of an anti-Labour Government, he has since been making all sorts of apologies for not reducing them. Now he is saying to the people, " "Well, if we cannot reduce taxation at least we have not increased it ". But his budget speech indicates that sales tax is to be increased by a total of about £9,000,000. It is evident that the Treasurer places his own position in an anti-Labour Government above the interests of the people that 3ie is supposed to represent, because the proposed increase of the sales tax hits the small country producer very heavily. One of the major increases is to be in respect of wireless receiving sets, sales tax on which is to go up from 8£ per cent, to 25 per cent. It is rather interesting to learn that an anti-Labour government regards wireless sets as luxuries. We do not have to turn our minds back many years to remember that anti-Labour governments and anti-Labour judges considered that a bath in the working-man's home was a luxury in this country. A radio set is an absolute necessity, particularly in country areas. The sales tax on radio accessories and radio batteries is to be increased, and will represent a further burden upon people in country districts. Here are the Treasurer's own words in respect of the proposed increases - >The purpose of the increases is to discourage the use of goods of the least essential character. To discourage their use by whom? Does he imagine for one moment that the wealthy people of this country will do without radio sets because the sales tax on them has been increased? When he talks about discouraging the use of what the Government regards as luxury items he does not mean that one wealthy person in this country will be obliged to go without a radio set. He simply means that if the purchase of radio sets is to be restricted, the restriction will apply to the lower-paid section of the community - the workers in industry and the small farmers. I notice that the sales tax on watches and clocks is to be increased to 33^ per cent., but that no provision is made for an increase of sales tax on alarm clocks. No doubt this constitutes the Government's plan to increase production. It does not wish the workers to sleep in and be late for work. Now I turn to social services. We used to hear honorable members opposite talk about their plan to remove the means test, but now they have postponed putting that plan into operation. It is rather interesting to note that the increased payments to pensioners are to commence from the 1st November next. But members of the judiciary and higherpaid public servants, who earn incomes of up to £5,000 a year, are to receive substantial salary increases, not fixed as a result of arbitration or of a strike - because they do not have to go on strike, but merely need to contact their friends in the Government - as from the 1st July last. These members of the judiciary adjudicate in relation to wage claims and talk about how much it should cost a worker and his family to exist, yet they decide, through their representatives in the Government, to give themselves substantial increases that are to date from the beginning of the financial year. Is it unreasonable to say that if the Government considers it fit to make the increases of the salaries of judges and higher public servants retrospective to the 1st July, it should also make the increases of sicial services payments for pensioners retrospective to at least the same date? Day after day in this chamber we have heard the doddering Minister for Health **(Sir Earle Page),** to whom the Prime Minister referred only recently by the peculiar name of "Dogsbody", tell us that the Government intends to do something about inaugurating a health scheme and a medical scheme for age and invalid pensioners, whereby those deserving people would obtain free the medicines and the medical services that they require. One of his colleagues, the Minister for Social 'Services **(Senator Spooner),** considers that pensioners ought to go to work. He thinks that that would bo a good way to achieve an increase of production. It is rather interesting to note how often members of the Government can think up ideas that do not affect themselves or the people whom they represent. I guarantee that if the pensioners of this country attempted to go to work the Treasurer would immediately order the sleuths in his department to see whether he could not disqualify them from receiving pensions because they were earn ing more than the permissible income. I come now to the hospital agreement between the Commonwealth, and the States, which is another of the Government's economic measures. The previous Labour Government provided that any person., irrespective of his social position, would be able to obtain free hospital treatment and would not be pestered by people asking him how much he could afford to pay. Despite all the Government's talk about the abolition of the means test, the Minister for Health has now provided that it is to be re-instituted in respect of sick people who have to enter hospital. He said that that measure would assist the finances of the hospitals because the patients would be obliged to pay at least £4,000,000 a year. No wonder the Government can talk about .being able to balance the budget, when it takes forced interest-free loans from one section of the community and at the same time effects economies that hit the people generally. I come now to the subject of industrial co-operation. During the last few days I have asked the Minister for Labour and National .Service **(Mr. Holt)** a number of questions relating to certain industrial disputes, which the Governmest was attempting to ascribe to Communist activity. It was quite clear that the reverse was the case and that the employers of this country were breaking industrial conditions that had existed for many years. Eventually the Government has been compelled to admit that the employers were at fault in the case of the shipping dispute at Newcastle, because the employers have now accepted the views of the Newcastle seamen and have decided to man ships on the conditions under which they could have been manned at the start of the dispute. The Liberal party claims to have sympathy for workers and trade unionists, and so it is profitable to examine how it treats its own employees. I shall inform the committee of a case that concerns a returned soldier who was foolish enough to become an employee of the Liberal party. For a period of four and a half years he was a paid organizer of that party. I refer to a man named A. G. Whitcombe. He has been dismissed from his position of organizer of the Liberal party - the party that claims to believe in dealing fairly with workers and employees ! It has refused to give him any reason for his dismissal, but we have a. very good idea of the real reason. He was given, one week's notice of the termination of his employment, although he was a " permanent organizer " and not somebody who had been appointed as an organizer for some particular campaign only. He married after he was appointed to the position and established a home in the country. He was advised of his dismissal verbally by **Mr. Tarrant,** the chief organizer of the Liberal party, who paid a visit to the Bathurst district and saw him there. He received no written notice of dismissal. **Mr. Tarrant** advised **Mr. Whitcombe** that the dismissal was the result of an executive decision. Honorable members have heard Government supporters talk about how members of the Labour party are under the domination of an executive. **Mr. Tarrant** also told **Mr, Whitcombe** that no reasons for the dismissal were given. **Mr. Whitcombe** wrote seeking reasons for his dismissal, to the following officials of the Liberal party: - **Mr. Carrick,** New South Wales State secretary ; **Mr. H.** W. Hesketh, New South Wales State treasurer; **Mr. J.** E. Cassidy, K.C., New South Wales State vice-president; **Mrs. Furley,** New South Wales State vice-president; and **Mr. Lyle** Moore, New South Wales State president. He also wrote to the Minister for Supply **Mr. Howard** Beale, for the same reason. None of them replied except **Mr. Carrick,** who did not give **Mr. Whitcombe** any reason for the dismissal. He merely wrote a letter which read in part as follows : - >The members of the Staff Committee gave very full consideration to your application for re-instatement to the staff of the Liberal party, but unanimously resolved that the decision to terminate your services be upheld. **Mr. Whitcombe** had not applied for reinstatement. He had asked only for reasons for his dismissal. I come now to the reason. That particular gentleman had appeared as a witness for the Liberal party before a royal commission that was held in New South Wales arising out of allegations made by **Mr. McCaw,** M.L.A. His evidence was not satisfactory to the Liberal party. He was abused outside the court by **Mr. Genders,** the Liberal party candidate who stood for election against **Mr. Cahill,** who told him that his evidence was not satisfactory. Further than that, the honorable member for Bennelong **(Mr. Cramer)** had a conversation with **Mr. Whitcombe** recently and asked him where he was stationed. When **Mr. Whitcombe** told him that he had been dismissed, the honorable member for Bennelong said, " You were involved in that royal commission. Could it be that? It is rotten if it is". **Mrs. Furley,** a .State vice-president of the Liberal party in New South Wales, also spoke in similar terms during a telephone conversation with **Mrs. Whitcombe.** The fact is, and there can be not baulking this, that Whitcombe was dismissed because he refused to tell anything but the truth before that royal commission. He could still have been an organizer of the Liberal party if he had been prepared to perjure himself. He was not prepared to do so, and was therefore dismissed, and the Liberal party refused to give him any reason for that dismissal. Members of the Liberal party claim to be the upholders of the rights of the people and of justice, and to protect the Australian workers. We can imagine what protection the workers would get if this Government had its own way. The Government has asked for industrial co-operation, but Ave know how the workers have been treated in respect of housing alone. The honorable member for Griffith **(Mr. Berry)** spoke recently about the shocking conditions in a housing settlement in Queensland, yet he supports a government that continues to bring in immigrants by the thousands, regardless of the situation that exists in the Australian community. {: #subdebate-26-0-s9 .speaker-JRJ} ##### The TEMPORARY CHAIRMAN (Mr Bowden: -- Order! The honorable gentleman's time has expired. {: #subdebate-26-0-s10 .speaker-JLU} ##### Mr CHARLES ANDERSON:
HUME, NEW SOUTH WALES · CP -- It has been my misfortune before, when speaking in this House, to follow the honorable member for East Sydney **(Mr. Ward).** When the honorable member for East Sydney speaks on the budget he does not deal with its main points. I take it that that means that he cannot find anything to criticize in it. The budget is the most important factor in our parliamentary system and through it is implemented the whole policy of the party that is in power. It is the mainspring of the Parliament. It alone provides the clear-cut distinction which marks a democracy from any other form of government. The final choice of the electors is the party that comes into power after a general election and in the budget of that party is set out its whole policy. That is why the budget is the mainspring of a democracy. Proposals involving expenditure are fully debated and can be scrutinized by honorable members of the Opposition, who, if they are the faithful representatives of the people that they claim to be, should criticize but not obstruct any provision that the Government has incorporated in the budget for the purpose of carrying out its professed policy. The Opposition is an integral part of our system of government and it is a part of its duty to ensure that the country shall be well governed on the lines that the people have chosen to follow. If honorable members of the Opposition would quietly sit down and reflect over their conduct in the last ten months the only conclusion to which they could come would be that never in Australian parliamentary history had any opposition done so much to destroy our parliamentary institution. Never in the history of the Commonwealth has a government been faced with such an Opposition as that with which this Government is faced. Rancour and distortion have been witnessed in this chamber practically every sitting day. Whether dealing with the Commonwealth Bank Bill, the Communist Party Dissolution Bill or other bills, the Opposition has subordinated the national interest to the party interest. Like Russia in the Security Council, it has abused the use of the veto in another place. The tragetdy is that Parliament is earning a certain degree of public contempt which is affecting more than the personal reputations of honorable members. By the stigma which they are earning, honorable members are breaking down our parliamentary institution. It is common knowledge that the Opposition has been under the direction of twelve outside persons. Honorable members of the Opposition recently were told to act in a certain way and this Government, which has met continuous obstruction since it has been in office, was denied the right of a double dissolution. The Government had that right because for the ten months that it had been in office it had not had a fair deal. Through this budget, the Parliament governs the people and guides and controls all things political. The way of life of every citizen is controlled by some proposal in it. Freedom from want, freedom from fear, and our liberties generally are all protected by this reflection of ihe' operation of our parliamentary institution. It is, in fact, an illustration of the functioning of democracy. The last ten months have shown signs of the dangers that are approaching. I say, with becoming modesty, that that was something that I forecast in my maiden speech in this Parliament. I stated, on that occasion, that the Opposition had certain duties to perform. I spoke, also, of my profund dislike of trade unions being linked with a political party. I, in com- mon with every other member on the Government side of the chamber, have a profound respect for the principles of trade unionism, but when trade unionism as an economic force is linked with a political party it is to be regarded with the greatest suspicion. Trade unionism is linked with a political party in Australia as it is in the United Kingdom, where that position might well lead to the dictatorship of the proletariat. Trade unions are organizations of trades people of certain categories who have banded together for their betterment and, as such, they have a very beneficial effect for their members. Nobody will deny that the trade union movement has had a profound effect on the standards and working conditions of people engaged in industry. But trade union bosses have found that, by gathering together in unity, they can develop force. Force, if used with circumspection, can be very good but all force must be kept under some sort of control. Under bad leadership a trade union can be a force for evil and, consequently, has to be watched with constant vigilance. Human emotions may be stirred up for spiritual reasons and for material reasons and in every walk of life there are people who have the hastily conceived idea of being dictators. The trade union offers a very good steppingstone for persons who have that idea. Any sort of man who wishes to obtain power over his fellow beings seeks support in groups such as trade unions which represent a movement that he can apply to his own gain. If a man wants to start a movement where does he look for support? Does he go to persons of wide views who have different values or does he go to the lowest common denominator ? I do not use that term in a derogatory sense. He will seek those who have the same outlook in life. Let us consider the coal-miners, whom I know fairly well. They have been with me in the army and one of my best officers was a coal-miner's son, but they live in communities which engage only in coalmining. They' go to the same " pubs ", work in the same occupation and attend picnics together. If there are accidents they assist each other. In fact, they are a people whose values are all more or less narrow and static and who are an easy prey for the deliberate designs of the skilful demagogue. Here, by means of inflammatory speeches, he can weld decent, gullible people together and build *a* solid force. It may be called a human law that men can be moved more easily by negative programmes than positive tasks. They respond to the negative more readily such as in their hatred of an enemy or in envy of one who is better off. Here the skilful agitator may work and, playing on grievances, build a strong united front. When the trade union leader says to the miners, " Look right ". they look right. If he says, " Look left ". they look left, and so they become a form which he can use for his own purposes. Too often he says, " Look left ". Where do the Communists seek their following? Among what class of people do their skilful agitators work? Surely it is among such people as miners. They are to be found where force can be engendered - among people who work in similar surroundings and have the samp idea of values. The Australian Workers Union, which is the biggest union in Australia, has always been free from Communist influence for the very reason that the members of the union are engaged in diverse tasks and are spread throughout the length and breadth of the country. Working in different places at different tasks, they have different outlooks and cannot be welded into a solid force. As long as the force of trade unionism is applied wisely it can do nothing but good, but if it is applied to evil purposes it becomes very dangerous. In Australia we are faced with the cult of solidarity. That is the idea that a trade union leader who has a solid core behind him becomes a much more powerful and important person. Under such circumstances tyranny permeates the unions and the ordinary democratic principles of trade unionism become lost. The formal laws of democracy disappear and are replaced by arbitrary trade union rules. Then we reach the state of affairs which may be found in many Australian unions to-day, particularly in those in which Communists have gained control. The only thing that the Australian fears is to be called a scab and that threat hangs over the heads of many trade unionists. It is a matter upon which I feel very strongly. Many a decent trade unionistdoes not attend the meetings of his union. I have heard leader after leader of the trade union movement say " Decent blokes won't attend meetings ". That is because they fear that if they do attend and speak with moderation they will be subjected to intimidation. They are afraid that their homes will be visited and their women folk warned of reprisals. That is the sort of thing that is taking place in Australia to-day. Some men have attained power and are developing it by means of a campaign of class warfare. When many honorable members on this side of the committee first came to the Parliament they were amazed to hear honorable members of the Labour party continually preaching class warfare. The American people recognize that there is more class warfare in Australia than in any other democracy. That is because some persons are using trade unions for political advancement. What has happened to the old Labour party, which was really liberal in its philosophy? If the political history of Australia in the early part of this century is read, a great similarity will be noticed between the Australian Labour party of those days and the present Government parties. But the trade unionists have now seized the Labour party and control it. The Labour party is now under the control of persons who have behind them economic forces. The Communists seek power in the trade unions so that they can use the forces of union solidarity for their own purposes. It appears that they have been singularly successful in Australia. The old principles of the Labour party are going the same way as the liberal principles of many of the unions went. Those principles are becoming more autocratic as time goes on. Recently we had the spectacle of twelve delegates from trade unions giving directions to members of this Parliament. That is certainly not democratic. Organizations such as trade unions were started by reformers, men of goodwill, but as time passes we shall find that the unions have been welded into machines which will become too strong for their makers to control and that conditions will arise when directions will have to be given which offend against democratic principles. When that occurs the men of goodwill will leave the unions. But in all organizations there are some ruthless persons who will not leave but will eagerly seize the opportunity to grasp power. Wherever force is not controlled the worst elements rise to the top. There are many trade union leaders in this Parliament, and I do not cast any reflection upon them in what I say. The trade union movement has not yet come to the pass where the worst has come to the top, but it is reaching that stage and there arc some unions in which the change is complete. I refer honorable members to the platform of the Labour party of 1945-46. Under the heading of " Industrial " it will be seen ' that one of the planks of the platform is " Preference to trade unionists". But by 1948 that had been changed to " compulsory trade unionism". That means that gradually the party found that it was forced to espouse the cause of compulsory trade unionism. That is one more step along the road to tyranny. The change in the unions is being reflected in. this Parliament by the conduct of the members of the Opposition. It is not now a parliamentary party, it is a group of delegates from trade unions. The Australian parliamentary system is thus being broken down. With the defeat of the Labour party at the last general election a feeling of great bitterness swept through the party and the unions and they fear that it will be some time before they are again in office. That feeling of bitterness has been translated into action in this Parliament. Their tactics now are to foster fear among the people. First they try to scare the people by talk about the depression. Then they talk about inflation and about the depreciated value of the £1. On no occasion have they attempted to assist the Government to bring about a better state of affairs in Australia. Bather have they adopted the policy of deliberate obstruction. The Leader of the Opposition **(Mr. Chifley)** came hack from a trip to England in 1948 and pleaded with the people for more production. That plea did not suit the trade union leaders and the talk of greater production soon died away. I do not say that all the working people in Australia are not working hard, because I believe that the great bulk of them are doing so. I am referring more to a union like that composed of the wharf labourers. Many people try to excuse the wharf labourers, but their union is led by a man who has been blackmailing the public for the sake of his own ambition. Again, nobody can defend a union which re-elects a man like McPhillips as its leader, a man who is a notorious Communist and who is even decried by the Labour party as a traitor to Australia. For what purposes has he been elected? He has attained his position because the members of the union think that he will be of advantage to them.' That is a very ugly spectacle. When such activities are linked with a political party there is the danger that our democratic institutions will not be preserved. The honorable member for Watson **(Mr. Curtin)** said that the workers will cooperate not with this Government but with only one Government, and that would be a trade union government. The trade unionist is showing more loyalty to his trade union in some cases than to his own country. Mi". Curtin. - All the loyalty is in the trade unionists of Australia. {: .speaker-JLU} ##### Mr CHARLES ANDERSON:
HUME, NEW SOUTH WALES · CP -- That is not how the matter appears to me. Otherwise there would be a lot more co-operation from honorable members opposite with the plans of the Government for the benefit of Australia. Another sorry spectacle is the taunting of this Government by the Labour party about its election pledges. This Government promised that petrol rationing would be removed, and petrol rationing was removed. It promised to deal with the Communists, but its attempt to do so was held up for many months by the Labour party. We received no help in our plan to give effect to that pledge. We promised to re-establish the Commonwealth Bank Board, but received no assistance from the Labour party in that connexion. We promised child endowment for the first chold, but again our proposal- received no assistance. The Labour party denies us the right to rule and then its members bleat about putting- value back . into the £1. In the recent basic- wage casechild endowment for the first child was not taken into consideration by the court, yet, we all remember the strong attacks by the Labour party when that legislation, was going through the Parliament, on the ground that amy such endowment would be. taken into- account in the assessment of the basic wage. I think that the Labour party has a strong case to answer here, and that any connexion between trade unions' and political parties has a very ugly significance. Honorable members should recall what the honorable member for Melbourne **(Mr. Calwell)** said when the Commonwealth Bank Board was being- discussed. His statement that the Opposition did not want a board' to Be appointed carried the implication that the Labour party intends to socialize the banks without the intervention of the law. Consider also the prices referendum. The people defeated that referendum because it contemplated giving to the Government powers that would, enable it to socialize Australia. The honorable member for East. Sydney said that prices started' to rise immediately after prices control, was- removed. Let us examine that statement. I do not believe that the Leader of the- Opposition, because of pique, removed certain subsidies immediately the prices referendum was defeated. We know now that, he could not make a decision in the master, and that it was made by the significant twelve. They may well be- called the group of the significant twelve, and two more in that group would make it even more significant. What was the object of withdrawing subsidies? A mere child must have known that prices would rise immediately. The subsidies were, removed to make it impossible, for the. States effectively to control prices and thus pave the way. for a new, prices, referendum. At the present time in Australia there is a force working, through trade unionism- which is- not responsible.- to the. electors, and I believe that the democratic institution of thePaul lament, will be gravely- endangered unless we take steps- to. remove this, force-, consider now the number of strikes that have occurred for political purposes in Australia. The great coal strike some time ago was for purely political purposes,, but it caused a tremendous amount to- be lost in wages and production. In Victoria and. Queensland there are about 30 strikes a year, but in New South Wales, which is the home of the Communists, there are 1,000 each year. Strikes make a great difference to our cost, of living. The people who strike control: the Labour party, and that being so there is no. doubt that our parliamentary institution is in danger. Honorable members opposite have no freedom as members of Parliament. When they are elected' they tell the electors that they will represent the electorate and that they will do this and that for the people, but they do nothing of the- sort. They are merely delegates in the power of the significant twelve. As long as" trade unionism is joined with a political party the danger will exist of a breakdown in parliamentary institutions. Trade unions are" an economic force, and as such should work only in the economic field. They should never enter the political field. One way of controlling the avid desire of union leaders for political advancement is the institution of the secret -ballot. If unionists ballot on the question of whether they are to strike or not they remove great, power from the hands of their leaders. The decent trade unionists who are forcibly swayed by the extremists in their unions have a right to. protection from the Government. It is not right that the Government should rule Australia and that a portion of thepopulation should be forced into the unions and then be intimidated. The national characteristics' of Australians' are- being- changed by the tactics, of extremists. In 1914-1S the Australian was recognized overseas as a forthrightindependent man. He is certainly not. that to-day. A man came into my shearing; shed drunk at. 11 o? clock one night,, and disturbed the whole shed. The overseer heard some men grumbling about it next morning,, and spoke to the- man, concerned., When he. was questioned he turned to the men who had been grumbling and said, " Did I disturb you ? " and everybody said " No ". That certainly would not have happened 30 years ago. Nowadays men are becoming afraid, and the fear is being caused by the forces of political trade unionism. I hope that more moderate trade union leaders like the honorable member for Burke **(Mr. Peters)** will try to defend the cause of moderation in their unions and to use the unions for legitimate economic purposes. I have come to the conclusion that the Leader of the Opposition agrees with the view that I have just expressed. I repeat that any party will defeat itself if it associates with a force that it cannot properly control. In that way, the Labour party will raise a monster that will destroy it. {: .speaker-JRJ} ##### The TEMPORARY CHAIRMAN (Mr Bowden: -- 'Order! The honorable member's time has expired. {: #subdebate-26-0-s11 .speaker-K6T} ##### Mr COSTA:
Banks .- Before I proceed to deal with, the budget proposals, I shall reply to some of the statements that the honorable member for Hume **(Mr. Charles Anderson)** has just made. Prom his remarks it is obvious that he is ignorant of the history of the great Australian Labour party and the trade union movement. I suggest that he should busy himself in the library by studying the history of those great organizations. He said that the Australian Labour party has been taken over and is now dominated by the trade union movement. Originally, the workers banded together in trade unions and formulated objectives for the purpose of improving the conditions of their employment. Eventually, they discovered that it was useless to have objectives unless they allied themselves to a. political party that could give legislative effect to them. For that reason, the trade unions established the Australian Labour party, and to-day that party is stronger than it has ever been before because over 75 per cent, of the trade unions in this country are affiliated with it. Just as the Labour party is backed by those industrial organizations, so does the Liberal party rely upon the support of bankers, big business organizations, chambers of commerce and chambers of manufactures. The honorable member for Hume had much to say about the shortage of coal. I shall cite official statistics in order that he may be informed accurately on that subject. Whereas in 1927, when there were 24,000 coal-miners employed in the industry, the production of coal totalled 11,000,000 tons, in 1942, when there were only 16,000 miners employed in the- industry, the production of coal totalled 12,000,000 tons. Thus 8,000 fewer miners produced over 1,000,000 more tons. In 1929, when 24,000 miners were employed in the industry the production of coal totalled 7,000,000 tons. That fact calls for some explanation. At that time, the mine-owners decided to reduce the wages of miners by 124 per cent, and when the miners refused to accept lower wages the mines were closed down. The mineowners could afford to take that action because large reserves of coal had been accumulated. However, the owners' practice of stock-piling coal was to rebound to their detriment. During that period many miners were driven out of the industry, which has not fully recovered from the injury that; was done to it by that -action of the mine-owners. Those facts indicate that the present shortage of coal is due not to any lack of effort on the part of the miners, but to the fact that for many years past fewer miners have been employed in the industry. That trend commenced during the depression. {: .speaker-KDH} ##### Mr Eggins: -- At that time the Scullin Labour Government was in power. {: .speaker-K6T} ##### Mr COSTA: -- And the board that then controlled the Commonwealth Bank refused to make available to that Government adequate finance to enable it to carry on the administration of the country. The Leader of the Opposition **(Mr. Chifley)** described the budget as " a fraudulent document". He said that it left unfulfilled many of the promises that the present Government parties made at the last general election, and that it gives no indication of what the Government intends to do to check inflation. I shall deal, first, with the Government's taxation proposals. During the last general election campaign the present Government parties harped on the fact that the Labour Government had not reduced taxes sufficiently notwithstanding that it had remitted many millions of pounds to taxpayers. Those parties also accused the Leader of the Opposition, who was then Treasurer, of having" built up hidden reserves. However, the taxpayers have been sorely disappointed with the Government's taxation proposals in th is budget. The Treasurer **(Mr. Fadden)** said that it embodies many major reforms in the taxation field. One of those so-called reforms is the Government's proposal to merge income tax and social services contribution. The Leader of the Opposition claimed that the workers are concerned not about the headings under which they pay tax but about the actual amount of tax that they are obliged to pay. The Treasurer also described as another reform the proposal to replace the system of concessional rebates with the system of deductions. In that respect, also the taxpayer is concerned not about the method of computing his tax but about the amount of tax that he has to pay. The Treasurer also lauded the Government's proposal to simplify the method of expressing the rate of tax. Some time ago a committee was set UP to simplify taxation procedure, and the Treasurer claimed that its recommendations constituted a landmark in the history of taxation reform. The fact is that the Government merely proposes to revert to the system that was in vogue before the present rebate system was introduced. It is also proposed to raise the age of dependent students for tax deduction purposes from nineteen years to 21 years. That change will not afford much relief to t,lie average worker. The Government also proposes to increase the maximum amount in respect of medical expenses for tax deduction purposes from £50 to £100. If the medical profession had co-operated with the Chifley Government in giving effect to its health and medical services scheme, the workers would not have been involved in any medical expenses. Therefore, that concession is not of much use to them. The Government has claimed that the increase of the maximum allowance in respect of life insurance premiums, contributions to superannuation funds and similar payments from £150 to £200 a year, will be of benefit to the people generally, but I maintain that it will not be of much assistance to the workers. With regard to the claim that income tax will be reduced substantially, the budget reveals that direct taxes will be reduced by £7,000,000, but that is counterbalanced by an increase of sales tax by £10,000,000. The Government is, as it were, putting it in at the back door and taking it out through the front door. The Treasurer, dealing with the taxation of business profits, said - >As part of an organized and balanced plan to bring those inflationary forces under control, measures are under consideration to draw off some part of the abnormal profits. At the moment, that is only a promise, and if the Government treats it in the same way as it has treated other promises that have been made it will be just another case of non-fulfilment. One feature of the budget that is a disappointment to every member of the Opposition and to most Australians is the failure of the Government to make any real increase of age, invalid, widows', service and other pensions, and the delay that will occur before the paltry increases proposed are paid. In view of the strong promises that the Government made during the last general election campaign and the manner in which it emphasized the terrible plight of pensioners, one would have expected it to give first priority to pensions increases, but, knowing the Government as I do, its failure to act generously and promptly in that matter does not astonish me. It is a case of those who get least get it last. The people of Australia will not fail to notice the promptness with which the Government acted in relation to high wool prices. It soon found a way to protect the squatter wool-grower. I do not agree with sectional taxes, but I point out that we soon discovered that the Government was eager to help those who needed help least. Recently I heard the Minister for Works and Housing **(Mr. Casey)** say that first things should come first. Having regard io the Government's failure to put value back into the £1, I believe that first priority should be given to increases of pensions. I invite the Minister for Works and Housing to use his influence with the Government and persuade it to put into The Government has let pensioners *S.&mi very* badly. Its .slowness -to act ion their behalf has 'been a tremendous disappointment, but -ewen at this late hour it could retrieve the position by -making the increases retrospective. A .precedent having been established in relation to the judiciary, why should it not be applied also to pensioners? -Steps are being taken to increase #ie salaries of judges, conciliation commissioners and other high officials by .£500 a year, and the increases are to be made retrospective to the 1st July. If it be right that increases 'of the salaries of -persons who are receiving thousands of pounds a year should be made retrospective, it is doubly right that increases of payments to pensioners, who receive only shillings a week, should also be made retrospective. The Government has shown very bad taste in this matter. It wonders why people become bitter. Although it is at its wits' end to find means of defeating communism, it does the very tilings that cause communism to thrive. Recently the Archbishop of 'Canterbury, in a broadcast to the people of this country, said that social justice "was a bulwark against all evil " isms ". He also said - >The Communist creed appeals to people who have throughout the ages known nothing but poverty, starvation and hardship. They have believed the promisee, and hope for deliverance. > >One way to repel the Communist advance is to raise the standard of living in backward countries', and I am pleased to know that Australia is taking a most valuable lead in securing .action in this respect. 'Our answer to the appeal of communism is to offer .something better. I believe that this Government should offer the pensioners something better. I suggest that it should accept the good advice that the Archbishop of Canterbury gave and also the advice that I am giving to it, and make increases of pensions retrospective. The Treasurer has boasted that the 7s. 6d. a week increase of pensions that "will commence from the 1st November will be the biggest single increase ever given to pensioners. In terms of figures that may be correct, but considered in terms -of what 7s. 6d. will purchase it is possibly the smallest increase that pen- Since this Parliament assembled early in the year, honorable members on this side of the chamber have directed the attention of the Prime Minister **(Mr. Menzies)** and other members of the Government to numerous anomalies to which the social services and pensions legislation gives rise. They have also suggested various increases that should be made either by expanding the field of the scheme or by liberalizing payments. Every Liber.a.1 party and Australian Country party candidate at the last general election, including those who were defeated, promised the people everything but the moon. For months before the election, special columns in every little newspaper throughout the country were devoted to the election bait of the anti-Labour parties. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Did they promise to put value back into the £1 ? {: .speaker-K6T} ##### Mr COSTA: -- Tes. I have here a large election advertisement that bears a photograph of the present Prime Minister. It declared, in bold type, " Reduced living costs and increased living .standards. Put the shillings hack in the £'s ". The budget merely tells a story of broken promises. One of the outstanding pledges in the advertisement to which I have referred was, " Removal of means test injustices ". The Government apparently has conveniently forgotten those undertakings. It should make provision for a higher funeral allowance for pensioners. This benefit of £10 was introduced by the Chifley Government in 1943. I remind the Government that the cost of dying has risen just as .steeply as has the cost of Jiving. Another neglected item is the allowance for wives of invalid pensioners, which is to remain at £1 4s. a week. In my opinion, the situation of the wife of a dependent invalid is inFinitely worse than that of a widow. The wife must maintain a home for herself and her husband, and rent must be paid for it. Many such women are forced by circumstances to go out to work in order to augment the pension and allowance, although it is essentia] for them to spend a great deal of time in the home caring for their husbands. The payments to invalids' wives should be increased at least to the level of other pensions. 'The Prime Minister has ignored the suggestion that has been made for the payment of a special allowance to pensioners at the Christmas season. At that festive time of the year, everybody - feels a need to spend a little extra money in the spirit of the season, but persons with fixed incomes, such as pensions, .are never able to put any money aside for such purposes. The Government could well make some special allowance to them. No attention has been paid to .the 1' ate ©f the unemployment and sickness -benefits since they were added .to the social services of the -country ,by the Labour Government. The rate is to remain at £1 .5s. :a week for a husband and £1 a week for a wife. The -serious decrease of the value of the £1 warrants an increase. A- class of persons that deserves the special consideration of the 'Government consists of - widows who were dependent upon sons who were -killed when serving their country during "World War II. These unfortunate women receive an allowance of £3 a week, but they are subjected to a severe means test under which they are allowed to earn only 6s. a week in .addition to the rate of pension. They ought to he treated in the same way as war widows, for whom there is no means test, are treated. Whenever members of the Opposition suggest any improvement of social services, supporters -of the Government raise the old hae and cry, "What did the Labour party do during the eight years in which Lt was in power ? " For the sake of those honorable members who do not know, I shall enumerate some of the benefits that were initiated by the Labour party when it was in office. I ask them to note particularly that the Labour Administration enacted these humane measures at a time when it was obliged to expend £1,500,000 daily in order to finance a total war effort. In 1944, the Labour party introduced the unemployment and sickness benefits scheme. Until that time, breadwinners who became ill or lost their employment from other causes had to rely upon charity. The widows' pension was introduced in 1942 and the .allowance for the wives of invalids in 1943. A hospital benefits scheme, providing for free hospitalization of .every sick or injured person in the community was inaugurated in 1944. Those benefits are exempt from any means test. Another innovation was the £10 funeral allowance foa- pensioners. One of the most valuable of all the new social services was the .scheme for the rehabilitation of invalid pensioners. In the first year of its operation, that scheme saved the community as much as £50,000, and enabled 500 pensioners to re-establish themselves in industry. The maternity allowance was increased by the Labour Administration from £5 to £17 10s. I regret that this .social service also has been neglected by the present Government. Social services generally were so extended and improved by the Labour party that, during its regime, the rate of expenditure on all benefits increased from £17,000,000 to £100,000,000 annually. Had the Labour party been returned to power on the 10th December last, it would have carried on the good work that it commenced so well. I am keenly disappointed that the inadequate pension increases for which the Government has budgeted will not have retrospective effect. {: #subdebate-26-0-s12 .speaker-ZL6} ##### Mr HASLUCK:
Curtin .- The debate on the budget offers such a wide scope to every speaker that the problem before me is, initially, one of selection. "Which topics shall I choose from among so many? I propose to begin by referring to two or three particular matters and then to make some general observations. The selection of the particular matters to which I shall refer will not be made because I consider those points the most important in the budget, but rather because they are among the points which have perhaps received insufficient attention. The first matter to which I should like to refer has, not been mentioned by any other speaker, I. think, except the honorable member for Deakin **(Mr. Davis)** this afternoon. *[Quorum formed.']* I should like to thank honorable members opposite for offering to assemble an audience for me after they had helped to reduce the numerical strength of the committee. The first matter to which I wish to refer is the proposal in the budget speech of the Treasurer **(Mr. Fadden)** to re-establish the Public Accounts Committee, which was discontinued in 1932 as an economy measure. I draw attention to the fact that for a number of years the AuditorGeneral has peristently referred in his reports on the finances of the country to the need for a public accounts committee. The need for this committee has 'become more and more marked as the years have gone by. The tremendous increase in the scope of the financial transactions of the Australian Government is in itself a sufficient reason why such a committee should be re-established. Estimated expenditure from Consolidated Revenue in the current financial year is approximately £738,300,000, compared with an actual expenditure of approximately £98,000,000 in 193S-39. With accounts growing at that rate, and increasing in. complexity, there i? clearly a need for the establishment of a public accounts committee if Parliament i« to discharge efficiently its function of oversight and ultimate control of the finances of this country. That function is perhaps the most important one that the Parliament, in a democratic state, can discharge. Now that public accounts have grown to such magnitude, 1 suggested that there is a very pressing need for continuous and detailed scrutiny of the expenditure of the government no matter which government may be in power. Moreover, it has become increasingly difficult either to cover the whole ground of the Estimates in the time allowed for the budget debate, or to enter, during such debate, into an examination of the individual items of the Estimates. I look forward for very useful services being performed for the. Parliament by the proposed public accounts committee. I trust that the spirit that will animate this committee, will be the spirit that is derived from the fact that such a committee will serve the Parliament, not any particular party, and that it will help the Parliament to discharge its functions in respect to the finances of the country. In passing, perhaps I may be permitted to express regret that a similar proposal by this Government for the establishment of a foreign affairs committee has not yet been put into effect, due, I understand, to failure to obtain the co-operation of the Opposition that is necessary to the establishment of such a committee. A second point to which I wish to refer is the Treasurer's statement about the Public Service. I should like to express personal satisfaction that some progress has been made in the tidying up of the over-balanced Public Service, the streamlining of departments, and the re-distribution of functions and the reduction of departmental establishments. It is also encouraging to note that the work of the Public Service committee which has been engaged on these matters is to be continued, and moreover, that it will be extended by seeking the co-operation of the Public Service Commissioners in the various States. Whilst ' expressing some satisfaction at what has been done I also express regret that, so far, this project has not been carried down to the fundamentals of the machinery of government. All that has been done to date has been done along the lines of reduction within the existing structure, and I submit, as I have done on a former occasion, that, after fifty years of federation and having regard to the great increase in the number of functions being performed by the Commonwealth, and the growing complexity of public administration through- the world, that there is a pressing need for a much more comprehensive review of the machinery of government in Australia than has yet been given to it. I hope that this Government will seek an examination of the more fundamental problems, not simply by a Public Service committee, but by some superior outside expert body, which might perform a function similar to that which was performed by the Haldane Committee in the United Kingdom after the 1914-16 war. The matters that should be examined on a higher level than they have yet been examined include the relations between the various departments, the functions of the departments, the course of devolution, of executive authority, departmental methods, duplication in departments, and machinery for interdepartmental consultations. Such an examination might well be extended to the machinery of Cabinet itself, both as to the number of Ministers given a place in the Cabinet, which, with all respect, I submit is perhaps a little too large at the moment for effective government, and also the machinery of the central secretariat of Cabinet, which, to my mind, has not yet been developed in Australia as fully as efficiency demands. Tn illustration of the points I am trying to make, I should like to mention an example of the type of problem that needs attention in Australia. So far as the Australian Government is concerned, we have a confusion of ideas regarding the distribution of functions among departments. At first glance we can see that there is a pattern of allocation of functions to departments in accordance with the services that those departments perform. For example, we have a Department of Defence created as a defence department, because it performs defence services. "We have a Department of Health performing health services. We have a Department of External Affairs performing services relating to external affairs, and we have the Department of Immigration, perform ing services in respect of immigration. That is a perfectly logical pattern in the allocation of functions to various departments. But side by side with that state of affairs we have numerous conflicts of ideas. We have a department such as the Department of the Interior, which seemingly abandons that original principle and becomes a department which is simply a kind of pigeon-hole for anything that happens inside Australia and is not covered by any other .department. We have a department such a.*, the Prime Minister's Department which, in part, is the central secretariat of the Government, but also is a repository for all sorts of odds and ends of governmental functions and administers a most diverse collection of activities. I go further to the Department of Commerce and Agriculture, where the idea of performing a certain group of services gives place to the idea of serving a particular group of industries. I also submit that, between such a department as the Department of Commerce and Agriculture, and such a department as the Department of Trade and Customs, there is a certain conflict of function and a certain duplication of function in respect of the service of both trade promotion and the application of the externa] trade policy of the Government. I mention those matters by way of illustration, not as an attempt to offer a final solution of a ]1 v of those problems, but merely to indicate some of the problems of governmental machinery which require urgent attention to-day, and which can receive that attention only by somebody making an examination outside the existing structure of government. I should now like to offer a word of commendation, if I may, on the provision that is made in the budget for social services. According to the information which has been given to us, the increases made in respect of age, invalid, widows, and other pensions are the most substantial that can. be granted at the present time. Speaking personally, I regard those increases - those welcome increases which will give a great deal of relief and materia] benefit to a number of people - as simply an interim measure. I recall the declaration' made in the joint statement of policy of the Liberal' party and of the Australian Country party during the last general election campaign that, if returned to- office-, they would undertake to prepare and submit to the people a more comprehensive and soundly based plan of social services, so that the people could pronounce upon it. If the opinionof the people was favorable> such a plan would be introduced. Such a comprehensive scheme would remove many of those features of the present social services which are so open to criticism. I refer to features such as the means test and1 inequality in respect of different classes of people. {: .speaker-A48} ##### Mr Chifley: -- Such a proposal would not run a place if it were submitted to the people by way of referendum. {: .speaker-ZL6} ##### Mr HASLUCK: -- I am not suggesting that a referendum should be taken onthat proposal. I am only recalling a declaration which the present Government made that it would undertake the solemn duty of trying to place social services- on a sounder financial footing, and. on a more equitable social basis. I have every confidence, in fact, I think that I may be permitted to say that I know that the Minister for Social. Services **(Senator Spooner),** with the officers of his department, is giving attention to the preparation of such a plan so that Australian social services shall not make, on the one hand, a perpetual drain on budget after budget, and shall give, on the other hand, a larger measure of social justice to the deserving people of Australia, who require some special provision to be made either for their old agc or for their invalidism. {: .speaker-A48} ##### Mr Chifley: -- The honorable gentleman may recall that some of the present Ministers were interested in one of those schemes years ago. {: .speaker-ZL6} ##### Mr HASLUCK: -- I remember the. national health and pensions insurance scheme, to which,. I believe, the Leader of. the Opposition **(Mr. Chifley)** has referred, but. I. am young enough, and. have sufficient confidence in Australia not to share his cynicism.. {: .speaker-DTN} ##### Dr Evatt: -- Scepticism ! {: .speaker-A48} ##### Mr Chifley: -- Just facts,' that is all'. {: .speaker-ZL6} ##### Mr HASLUCK: -- The next matter that I should like to- mention is the pro1vision which rs- made in the budget for defence-. An amount of more than £l33,000,000 is- to be expended1 to ensure the defence of this country. All honorable members- on this side of the chamber welcome the making of that provision, but, whilst welcoming it, they express some disappointment that readier co-operation on matters of defence is not forthcoming. from the Opposition. Although I advocate, the provision of such a large sum for the defence of Australia, I think that I may be permitted to add my opinion that this country cannot be defended simply by the expenditure of money. Simply to. vote a large amount of money, and then to believe that we have provided for the defence of the- country may be likened, to my, mind, to a very small' man who puts on. big clothes, with padded shoulders1, and imagines that, thereby, he has increased his strength. To make our defence vote something more than mere paper talk, we have to put behind it a solidly-based and expanding economy. The Leader of the Opposition, in speaking on the proposed defence expenditure, said that we had to be careful not to over-strain, the economy of the country. I consider that there is something valid in that remark, but,, for my own part, I should prefer to state it in a different way. This increased provision for defence has to -be accompanied by an expansion of the development of Australia, an increased use of the resources of Australia, and a growth of production in Australia, otherwise it will be. comparatively meaningless. Those two- matters go- side by side. The- right honorable gentleman may prefer to- say, " Do- not overstrain the- Australian, economy ", but I prefer to say, " Provide for. the defence of Australia, and make that defence effective by co-operating with, us in increasing the- development, the production and the economic strength of this country in general "'. The basic problem is: still the old' war-time problem of the. best use* of man-power and materials. That thought leads me' to the general problem- of the economic health and strength of this country. I believe- that this Government can take to itself a considerable measure of -credit for the way in which, first of all, it is continuing the policy inaugurated by the previous Government for increasing the population of Australia; and then, for the measures it is taking for national development and for obtaining the dollar loan - not from the United States of America but from the Bank of International Reconstruction and Development - in order to provide for that capital equipment without which national development cannot proceed very far. If there is one point that should be emphasized more than another, it is that we in Australia today are facing a time of acute national peril and a time in which the fundamental issue is one of survival that we must, therefore, either develop or wither away. We cannot stay still. In this debate, much has been said about increased production. It has been said with varying degrees of emphasis and passion, and in various contexts. But I doubt whether mere talk about increased production is enough, if, by increased production, we simply mean that we shall try to squeeze the last drop out of the existing sponge. I do not think that such a policy would take us far. Increased production in that sense would simply be a counsel of despair. Increased production will only take on its full meaning if we think of the provision of new sources of supply, of expansion into new fields of production, and of providing new strength for our country. We should think, not simply of getting another little bit out of the old machinery, but of building new machines, building greater economic strength in this country, and expanding our whole economy so that, we can obtain increased production in the fullest sense of the term. Unfortunately, it seems to me that much of the talk about increased production is along two lines. Some people say that the workers must work barrier, and others say that they are frightened that employers will make too much profit. I submit that our problem is too simply -stated if we think -of higher production only hi those terms. We have a common task, whether we are wage-earners, managers or owners.; and our part is not to begrudge one another profits, or to try to impose stricter industrial conditions on some other group, but to co-operate in the -development . of our country. During discussions about higher production there seems to be too much of a tendency to talk about capital and labour as separate and rival entities. Let us examine those two terms. - Where is the capital of Australia held? Unfortunately, not enough study has been made of the subject to enable us to answer the question definitively, but honorable members must realize from their own experience that capital is very widely held. The widow who owns £3,000 worth of shares is a capitalist. The trade union secretary who has invested £500 is a capitalist. Honorable members opposite who speculate in the buying of property, or who advance money, are capitalists. We are all capitalists. Capital, under modern conditions, is more vague and shadowy than when it was held in a few hands and administered by a few people." Let us now turn to the term " labour ". The practice of classifying a3 labour groups engaged in certain occupations is clearly false. Surely the term " labour " must cover any one who does a fair day's work, and gives of whatever skill, talent and strength he has. The term " labour " covers those who work at the desk and those "who work at the lathe, those who work with a shovel and those who work with a pen. If honorable members on the front bench opposite cast their minds back to the war period, they will realize that when war-time man-power controls were necessary the Labour 'Government did not apply them only to those whose work involved the expenditure of muscular strength. The control of those working at all kinds of occupations was necessary. Under war-time controls, the man who pushed a pen was often just as important as the man who swung a pick. Labour is much more comprehensive a term than some (honorable members opposite are disposed to believe it to be. I add to those attempts to give a new definition to the terms "capital" and "labour" something which was implied in the considered and thoughtful speech of the honorable member for Bendigo **(Mr. Clarey)** earlier this evening. In the new economy, the position of those who are called the managers of industry is equally as important as that of labour, and is far more important than capital. Those who take part in management are themselves, for the most part, employees. They are not capitalists according to any strict definition of the term, but employees. When we consider realistically the problem of achieving higher production we come down to the factory manager, the sub-manager, the works foreman, the shift boss, and the man handling particular tools. Higher production can be obtained only by *the* co-operation of all of them. The manager alone cannot give higher production. The workman alone cannot give higher production. Higher production can be achieved only by all working together. We should not go on talking of capital and labour as if they *wore* two antithetical bodies which must always be in opposition. Rather should we think of them as engaged in a common enterprise in which common benefits can be shared. Above all, we should think of them as engaged with management in a common enterprise for the advancement of the economy of this country. In my opinion, and in the opinion of many honorable members on both sides of the committee. Australia is facing a critical time. It is no exaggeration to say that we are once again, as we were nine years ago, up against the solid central issue of survival as a nation. I take it to be inmost in the patriotism of all Australians that they want Australia to survive, to hold to our way of life and to the traditions and hopes that we have held in the past. If honorable members on both sides of the chamber share that hope in the future of Australia they must recognize that they, in their various capacities, must accept the common task of making Australia strong, and of giving reality to the 'budget proposal for the defence of the country. Progress reported. {: .page-start } page 1546 {:#debate-27} ### SUPPLY BILL (No. 2) 1950-51 Bill returned from the Senate without requests. {: .page-start } page 1546 {:#debate-28} ### SUPPLY (WORKS AND SERVICES') BILL (No. 2) 1950-51 Bill returned from the Senate without amendment. {: .page-start } page 1546 {:#debate-29} ### ADJOURNMENT {:#subdebate-29-0} #### Dr. H. V. Evatt, M.P Motion (by **Mr. Fadden)** proposed - >That the House do now adjourn. {: #subdebate-29-0-s0 .speaker-A48} ##### Mr CHIFLEY:
Leader of the Opposition · Macquarie -- I crave the indulgence of the House to refer to a matter that was raised in this House last night, and to place on record certain observations by another body. When the matter was raised last night, I felt that I should ask you, **Mr. Deputy Speaker,** to give a ruling on the point whether matters under consideration in the courts ought to be discussed in this House. You did not, in fact, rule on that point. The Minister for Labour and National Service **(Mr. Holt)** in the course of what I regard as a completely evasive utterance, sought to bring under notice, and, I think, to cast reflections upon, and engage in a smear campaign against, the right honorable member for Barton **(Dr.** Evatt), which I described then as being characteristic of what some other members of the Government had been doing in regard to certain proceedings in a particular court. I shall continue to refer very briefly to it in that way, because it was by adopting such evasive tactics that the Minister for Labour and National Service was able to raise the matter last night. My colleagues and I made a very clear statement about the matter. The right honorable member for Barton is a member of the legal profession, which is a distinguished profession, and as such he is justified in going to any court to represent any client, without necessarily holding the views of his client or of espousing the cause that his client might be espousing. But, apart altogether from his right to do that, the right honorable gentleman holds the position of King's Counsel, which is a more privileged position and carries greater obligations than that of an ordinary barrister. I thought it was quite wrong, therefore, that, for political reasons and as part of a smear campaign, an attempt should have been madeto reflect upon my colleague. The Minister for Labour and National Service said in the course of his remarks that he ha<. notified the Prime Minister **(Mr. Menzies)** of the action he proposed to take. He did not say that the action that be took in the House had the concurrence of the Prime Minister. The Minister said that he had informed the right honorable gentleman of hi.-i intention to act in a certain way, but I do not know whether that involves the right honorable gentleman in acquiesence in his colleague's remarks. L" should have thought that the right honorable gentleman, who is himself a very distinguished member of the legal profession, and, as Prime Minister, holds the first position in this country, would not have been a party to the action engaged in by the Minister for Labour and National Service last night. I merely put that point of view because I thought that the incident that occurred in the House last night was quite disgraceful. Since last night and following, I presume, the publication of reports in the press of the proceedings in the House night, the chairman of the Committee of Counsel has seen fit to make a statement on behalf of the Victorian bar on the matter. In the interests of the historical record of this incident, and for the benefit of any one who later reads about it, 1" crave the permission of the House to place on record in *Hansard* the statement made by the chairman of the Committee of Counsel, which is as follows: - > **Mr. E.** R. Reynolds, K.C., Chairman of the Committee of Counsel, on behalf of the Vic torian Bar said- {: .speaker-BV8} ##### Mr Calwell: -- He is a member of the Libera] party. {: .speaker-A48} ##### Mr CHIFLEY: -- Besides being a member of the Victorian bar, I understand that he is also a member of the Victorian Parliament. **Mr. Reynolds** said - >Current public discussions involve the .propriety of members of the Bar holding briefs in certain causes. To avoid public misunderstanding as to the position of the barrister concerned, and to prevent unfair criticism, the Committee of Counsel made the following statement: - *lt* is a barrister's duty to accept a brief in the courts in which he professes to practise at a proper professional fee, unless there arc special circumstances to justify his refusal to accept a particular brief. > >Special circumstances are such as would cause professional embarrassment to the counsel offered such brief and would include unfairness to any other party to the cause and any impediment to the best effort of counsel in his conduct of his client's case. " A barrister is not entitled to refuse a brief merely because of the character of the cause or of the client, or because be does not share the ideals involved in the former or dislikes the latter. Unless this were so, it might happen frequently that many claims or defences might not be put properly or at all before the courts and many persons might be denied justice under the law, which is the right of every citizen. " A litigant is entitled to free choice of . counsel and counsel is bound by his profession to take up his cause forensically subject only to the limitation above stated. The decision as to whether he is likely to be embarrassed or not is one for the individual barrister concerned and in which he must be guided by his knowledge and conscience." In a further statement **Mr. Reynolds** made certain remarks which I should like to engrave on the mind of every person in this country who believes in tolerance, liberty and justice. Those remarks are - >Freedom of advocacy is one of the foundations of liberty. The advocate can never be suppressed. That principle is the inspiration of the Bar. **Mr. Reynolds** added that statements such as he had made on behalf of Victorian barristers were rare, and were made only after careful deliberation. I merely add that I hope that those members of the legal profession, and, in particular, the Minister for Labour and National Service, who raised this matter, will learn, from the words of the representative of his colleagues of the legal profession, some sense of decency in dealing with the public affairs of this country. {: #subdebate-29-0-s1 .speaker-N76} ##### Mr MENZIES:
Prime Minister · Kooyong · LP .- The Leader of the Opposition **(Mr. Chifley)** has been good enough to refer to me in connexion with this matter, and, indeed, I find that I had the honour of being referred to in the House last night. I should perhaps begin by saying that I was not in the precincts of the House last evening. I was engaged in conversations with the Ambassador of the United States of America, and was not in the House. {: .speaker-KYC} ##### Mr Pollard: -. - Did the right honorable gentleman know that thos subject was going, to be raised.?. {: .speaker-N76} ##### Mr MENZIES: -- I had the benefit of a conversation on the telephone with my distinguished colleague, the Minister for labour and National Service **(Mr. Holt).** {: .speaker-KYC} ##### Mr Pollard: -.! - And did the right honorable gentleman approve- of his attitude ? *Honorable- members interjecting,* {: #subdebate-29-0-s2 .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! {: .speaker-N76} ##### Mr MENZIES: -- I do not mind being cross-examined. The: Leader of the Opposition has referred to a statement made by tha chairman of the Committee of Counsel of Victoria, and I am bound to' say at once that J entirely subscribe to the statement made by **Mr. Reynolds.** It has never occurred to me - although it has occurred to some people - that counsel is necessarily identified with- his client, and,, in any event,. I am, of course, utterly familiar with, the rules that exist at the bar. So, indeed, is my colleague, the Minister for Labour and National Service, who is a. member of the profession. As I understand it, he has not at any time challenged those rules. In the course of the debate on the motion for the adjournment last night, the honorable member for East Sydney **(Mr. Ward')** took a hand and referred to myself. He even ventured to say that there was a time when I was Attorney-General in the Government- of Victoria, and he- went on to say that. the. Government of which I was a member appointed a royal commission to inquire into the operations- of the Shell Oil Company Limited. It is a trifling matter,, but the statement was quite untrue. The royal commission into the operations- of the petrol, companies of Australia was not appointed by the Government of Victoria, but was appointed by the Australian Government, of which I was not a member; Indeed, at that time I was- not even a member of this Parliament. But the honorable member, having falsified! that matter, went on to: say that it was- a matter worthy of note. The simple truth is that- I was not a member of this Parliament, and that I exercised my right and performed my duty as- a member of the bar for- a client. So much for that; {: #subdebate-29-0-s3 .speaker-KX7} ##### Mr WARD: -- The right honorable gentleman is off the beam-. That is not my speech at all. {: .speaker-N76} ##### Mr MENZIES: -- Then all I can say is that the honorable member has been grievously misreported. It is quite true, as the right honorable member for Barton (Dr:. Evatt) and I are well aware, that counsel who is practising in a court and has a brief offered to him, has to. take it unless the fee is insufficient, or he is otherwise engaged,, or he would suffer some definite personal embarrassment by accepting the case. Let us suppose, for example, that I were not the Prime Minister of this country, but. a private member of this House, and in the course of the debates on the anti-Communist legislation I had expressed the views that. I am well known to hold on this matter. If I were then offered a brief to appear for the Communists, I should have to consider my position carefully. I should have to consider whether my duty was here or elsewhere1. That is quite obvious. I should have to consider whether, as the Parliament was sitting, I should absent myself from- ifr to- appear in *the* case. {: .speaker-KYC} ##### Mr Pollard: -- Like Percy Spender did !' {: .speaker-N76} ##### Mr MENZIES: -- Each man may speak for himself. {: .speaker-BV8} ##### Mr Calwell: -- The honorable member for Warringah-, is not here to speak for himself. {: .speaker-N76} ##### Mr MENZIES: -- It, is- the misfortune of the right honorable- member that he is here to- speak for- himself. Those rules are very well understood. All I desire to say is that the right, honorable gentleman may find himself in a somewhat, embarrassing position over this matter. All members of Parliament, whether they be- party leaders-,, or deputy leaders, or rank-and-file party members, have some responsibility other than their personal responsibility to themselves. There- is> litigation in the. highest court in the land. I shall not say one word about that because I am well aware of. my duty, but honorable members generality will realize that, in the High Court, two matters- promise to become matters of issue. One iff the validity of the law. That is a pure matter of law. The other- is, whether the recitals in the bill. which set out a: series of charges against the Communist party, earn be examined' in court. That matter has still' to be decided by the High Court because-, as the honorable gentleman will' agree, one of the arguments already advanced is- that those recitals about the Communist party are not conclusi ve and are not, as the lawyers say, traversable and can be argued to determine whether they are true or fal'se. I shall not presume to anticipate the court's decision on that- issue. {: .speaker-A48} ##### Mr CHIFLEY: -- I suggest that the right honorable gentleman is getting very close to being out of order. {: .speaker-N76} ##### Mr MENZIES: -- Not at all. Not one word that I say on this matter will' be calculated to influence the court's decision, and I offer no opinion at all on what that decision will be. I merely point out to the House that the High Court will decide first whether those recitals can be debated and made the subject-matter of evidence; and, secondly, whether, according to the answer to the first question, the act itself is a valid exercise of the Commonwealth's power. Those are the two- questions that have so far emerged in the course of discussions iri the High Court. The court will give a completely impartial judgment on those questions. However, if the High Court decides that those recitals are capable of being denied, and must be the subject-matter of evidence, then, whoever appears for **Mr. Healy** or any union concerned, will' find himself for a week, a. month, or perhaps two months, leading evidence, cross-examining witnesses, and advancing arguments to the effect that the statements made against the Communist party in the recitals are not true. I am not standing in the place of the right, honorable gentleman, but if he finds himself required to undertake that task, then I can very well imagine that there may bc great embarrassment for those members of this Parliament who sit behind him. This is purely a matter of personal judgment; but that judgment lias to be formed in the light of the task that has to be done. It is not a task that I should care to undertake were I in the right honorable gentleman's- place, but that is only my judgment. I accept at once, as *1* nam sure my colleague- the Minister for Labour a-nd National Service. does, the proposition- that iti is foi" the right honora'bl'e member for- Barton to. determine the matter for himself. *[Extension of time granted.]* I repeat that this is purely a- matter of personal judgment. Thd,8 House is engaged in the discussion of legislation of very great importance-. Snowing that,, and knowing **Ms position** in his party, the right honorable gentleman says ku effect, " I am able to attend to. this case- ".. That is for bain. to> decide. If he accepts, all that that involves in the. nature, of the case to be presented,, that is. a matter for himself, but it will be for his- party to> decide whether that brings any- embarrassment to.- those who sit behind him. This does not seem to me to be an occasion for any argument about general- principles,, because the general principle- is. clear. This. is. purely a matter of individual judgment. I myself, should feel very embarrassed hy. arguing, on a great matter of public controversy, a proposition which ran in the teeth, of what was believed by those- who honoured me: by sitting behind me. {: #subdebate-29-0-s4 .speaker-KYC} ##### Mr POLLARD: -- The right, honorable gentleman is, trying to. prejudice the standing of counsel in the Bligh Court. {: .speaker-N76} ##### Mr MENZIES: -- I shall- be very happy to. know whether the honorable member for Lalor **(Mr. Pollard)-** disagrees with the propositions I have put. Again I say that this is purely a, matter of individual judgment. All counsel who appear in the High Court are listened to on the strength of their arguments and on the merit, of the case, that they present. Nobody denies that the right honorable member for Barton has a perfect right to appear in the High Court on this matter. All I say is- that, on this overwhelmingly important issue, with the nature of the. arguments before us,, it is for him and nobody else to determine whether he will put himself into this position. {: #subdebate-29-0-s5 .speaker-DTN} ##### Dr EVATT:
Barton .- I did not intend to speak on- the motion for the adjournment, but 1 wish to make some remarks, about the matter with which the Prime Minister **(Mr. Menzies)** has dealt. It is very good of the Prime Minister to envisage- a situation in which I might be involved. I entirely agree with the statement of the- leader of the- Victorian bar, which indeed expresses the view of the whole of the Victorian bar, about the position of counsel. The right honorable gentleman had no need to elaborate these points. This is not a question of counsel's rights. It is a question of counsel's duty. I was offered the brief that is the subject of this debate, in the proper and ordinary way, and I accepted it. I desire to say to the House, but not as a matter of politics, that I considered that I would completely forfeit my position as a member of an honorable profession if I did not accept the brief. I quite agree that, as the Prime Minister has said, the two clients concerned in the case do not commend themselves for the time being to him. The clients are the general secretary of a great trade union and that trade union itself. I think, however, that the right honorable gentleman admits that that has nothing to do with the case. I consider that the statement of **Mr. Reynolds,** the leader of the Victorian bar, shows that unless the members of the bar in this case act on their own responsibility and, to the best of their ability, discharge their duty to clients, no person in the country could feel any security so far as the administration of justice is concerned. That is how I felt. I am convinced that this question of embarrassment is all just an imaginary question. I do not intend to discuss the issues of the case before the High Court, as the right honorable gentleman did, and as you allowed him to do, **Mr. Deputy Speaker.** {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- The Prime Minister did not discuss the merits of the case. {: .speaker-DTN} ##### Dr EVATT: -- He said what the issues would be, and one of the great questions in the High Court is what those issues will bo. That is the matter for argument and debate. I do not want to traverse the issues, but I can assure the House and the country that there will be no embarrassment in this case. There is nothing that I have said in the House that will be in conflict with my duty in the case. I am determined to perform my duty in this ease to the best of my ability. Last night, the Minister for Labour and National Service **(Mr. Holt)** took it upon himself to be the champion of the Parliamentary Labour party, and spoke about whether its members approved pf what 1 had done. This is the gentleman who suggests the principle that before a member of the bar should appear in a case he should apparently obtain consent to do so from the political party to which he may happen to belong. What an extraordinary principle! If it were to be observed anybody who was engaged in politics would have to sacrifice his normal profession completely. I suppose it would apply to professions other than the legal profession. It could apply to the medical profession, and could have the effect that before a doctor who was engaged in politics attended a patient he might have to inquire what the patient's politics were. That line of thought could be elaborated. I want to say to the Minister for Labour and National Service that he is the last person to attempt to appear to defend the rights of the Parliamentary Labour party in relation to myself. Let that matter be discussed between my colleagues in the Labour party and myself. He deliberately intervened last night not, in my opinion, for a bona fide purpose, but for another purpose - to embarrass the proceedings in the High Court and to try to injure me. It was a very wrong thing for him to do, and I cannot understand his doing it unless he was advised to do it. The tone of his observations last night was very different from the tone of the Prime Minister's observations to-night. One has only to read the report of his statements and compare them with the statement of the Prime Minister to-night to find that the tone of his remarks differed entirely from that of the Prime Minister. The Prime Minister's remarks to-night were a judicial and calm utterance, whilst last night we had the eager rushing in of the Minister for Labour and National Service. The attitude to the Communist Party Dissolution Act of the organization and the person for whom I am appearing has, of course, nothing to do with the case. I consider that, from my reading of it, this matter was sufficiently canvassed last night, but I must say that I regard the statement of the leader of the Victorian bar, in the circumstances in which it was uttered, as a complete vindication of my conduct. I am determined that I shall perforin my duty as a member of the bar, undeterred by any intimidation from whatever quarter it may proceed. {: #subdebate-29-0-s6 .speaker-KEE} ##### Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP -- I do not want to take part in any further discussion on this particular case, **Mr.. Deputy Speaker,** but I ask for a I'll ling from you in respect of all cases of this nature. I direct your attention to parliamentary practice, as laid down on page 115 of May's *Parliamentary Practice.* That procedure appears under the following heading: - >Advocacy by members of mutters in which they have been concerned professionally: *May* states as follows: - >On the 22ml June, 1858 the House of Commons resolved that " lt is contrary to the usage, and derogatory to the dignity, cif this House that any of its members should bring forward, promote or advocate in this House any proceedings or measure in which he may have acted or boon concerned for, or in consideration of. any pecuniary fee or reward". Should an amendment of the Communist Party Dissolution Act, for instance, some before the House as a result of a ca9e of the nature now before the High Court, would any honorable member - and I am not referring specifically to the right honorable member for Barton **(Dr. Evatt),** who may or may not be receiving a fee in this particular case, nor am 3 referring to any individual - who, in his professional capacity received any fee for having appeared in such proceedings, come under the provisions of the parliamentary procedure to which I have referred? In this particular case the act that is under challenge has been passed. But if an amendment was submitted to it. would any honorable member who had been concerned professionally in a case that had arisen as a result of the bill, and who had. received a fee or reward, be entitled to take part in the debate on that amendment? {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- There is no need for me to give a ruling on that matter now. I shall consider such a situation when it arises. {: #subdebate-29-0-s7 .speaker-BV8} ##### Mr CALWELL:
Melbourne .- If ever a Minister was repudiated by his leader, the Minister for Labour and National Service **(Mr. Holt)** was so repudiated to-night, because the Prime, Minister **(Mr. Menzies)** has said that the right honorable member for Barton **(Dr. Evatt)** had a perfect right to do what he did. Last night the Minister for Labour and National Service said that the right honorable member for Barton had no right to accept the brief that he had accepted. The Prime Minister, in spite of all his words this evening - and they flowed from him as water flows in a cascade - did not endorse the action of the Minister for Labour and National Service last night. The Minister has been, in a gentle way, repudiated by his leader. The leader of the Victorian bar, who, with the Prime Minister, the honorable member for Chisholm **(Mr. Kent Hughes)** and some other people, was a founder of the Young Nationalists Association, has indicated very clearly what the legal position is in regard to the acceptance of briefs. Although the Prime Minister has read us a lecture to-night on the conduct that ought to be pursued by those members of the legal profession, who are also members of the Parliament, he himself has not followed that advice in this Parliament. I remember one case that occurred in the period in which he sat in Opposition during the lifetime of the last two or three parliaments. It involved a scandal in the Defence Forces Canteens Trust Fund. Two people whose names were, I think, Brewer and Roberson, were convicted, and although an all-party committee had decided that certain action should be taken against them, if my memory serves me aright the present Prime Minister appeared in the appeals court for them and they gained an acquittal. {: .speaker-N76} ##### Mr Menzies: -- That was not a parliamentary committee. {: .speaker-BV8} ##### Mr CALWELL: -- It was appointed on the authority of this Parliament, at any rate, and dealt with a matter that came under a law passed by this Parliament. Precisely the same position obtained in that instance in which the Prime Minister accepted a brief as obtains in the present instance in which the right honorable member for Barton has accepted a brief. However, certain remarks were attributed by the Prime Minister to the honorable member for Sydney **(Mr. Ward),** which should have been attributed to me. The Prime Minister said that the royal commission on -.petrol was appointed, not by the Parliament of Victoria, but by the Commonwealth Parliament. The royal commission that was (appointed to inquire into the conduct of the .Shall Company of Australia Limited was appointed by an anti-Labour government and the present Prime Minister, who was the AttorneyGeneral for the State of Victoria at that time, was, therefore, charged with the duty of protecting the public interest as far as his State was concerned. Instead, he appeared for that companyThat was a matter for him to decide. I should never have mentioned the matter again, although it was canvassed in this Parliament in days gone by, hut for the scandalous attacks that were made by the Minister for Labour and National Service on the right honorable member for Barton. If the Minister for Labour and National Service was justified in saying the things he said about the right honorable member for Barton, I am justified in drawing analogies from the past, in making comparisons with the conduct pursued by the present Prime Minister, and in asking, if that was right, what was wrong with the action taken by the right honorable member for Barton. {: .speaker-N76} ##### Mr Menzies: -- The 'honorable member is not doing his colleague much good. {: .speaker-BV8} ##### Mr CALWELL: -- I do not think that the Prime Minister is doing his party much good. {: #subdebate-29-0-s8 .speaker-DB6} ##### Mr WENTWORTH:
Mackellar -- I do not think that any honorable member would have the presumption to disagree in any way with the pronouncement of the leader of the Victorian Bar. After all, that pronouncement concludes by saying that this is a matter for the conscience and individual guidance of the man concerned. The man concerned must judge whether he himself will, or will not be embarrassed. I believe that the right honorable member for Barton **(Dr. Evatt)** must have known of the great -embarrassment which would inevitably 'flow from his acceptance of this -brief. I do not believe that he could possibly have been such a political child a-s not to have known that. That raises in its proper perspective the political issues, which are not only quite separate from, but also transcend, the legal issues. {: .speaker-JF7} ##### Mr Beazley: -- I rise to order. The honorable member for Mackellar has said that he intends to -raise the .political issues that are associated with certain activities of the right honorable member for Barton **(Dr. Evatt),.** I ask for your ruling, **Mr. Deputy Speaker.** Is this to be construed as an attempt to intimidate the right honorable gentleman in his activities in the court, and to make him afraid of the political consequences of his action? {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- I shall not attempt to construe the words of the honorable member for Mackellar until I have heard what he has to say. I shall listen carefully to his words, and form my own judgment. {: .speaker-DB6} ##### Mr WENTWORTH: -- I assure you, **Mr. Deputy Speaker,** that the political issues I had in mind do not in any way affect the matters that have been raised by the honorable member for Fremantle **(Mr. Beazley).** What would be the motive which induced the right honorable -member for Barton to take a step of this kind, which he must have known would be embarrassing? There are three possibilities. They might well be fear, hope of gaining a personal advantage, or vanity. Let us examine those motives. He may, perhaps, have been compelled to take this brief. Do not forget .the circumstances in which the right honorable gentleman first entered this Parliament. I quote from an article written by **Dr. Lloyd** Ross, which was published in *Railroad* of the 15th October, 1940, referring to the original election of the right honorable member to this Parliament. **Dr. Lloyd** Ross wrote - >Wo might also recall that the first approaches to Doctor Evatt were made by the Hughes-Evans group. The Communist roots of the right honorable gentleman's political past may go a little deeper than some members of this House, and the community, realize. Let us remember that, during 1941, he acted in many cases as the legal adviser of the Council for Civil Liberties, which is now declared by the Australian Labour party to be a Communist front. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! The honorable member had better .restrain his language. The StandingOrders for bid unworthy imputations against 'Other honorable members. {: .speaker-DB6} ##### Mr WENTWORTH: -- Very good, sir. After all, what theright honorable gentleman is doing in this case may be no more than a repetition of what he did in 1941. That, I think, may indicate that an Indian sign was placed on the right honorable gentleman. So much for the first motive - fear. Was he actuated by hope of personal advantage? This is a matter of high political principle,because some of the views that have been canvassed in this House seem probable,or at least possible, and others seem rather improbable. It is said by some that the righthonorable gentleman is trying to make his marble good in case Communists should ever get control of this country. I do not believe that accusation to have substance, but I think that he is trying to make it good in case there should be a contest for the leadership of the Australian Labour party. Mr.Chifley. - I rise to order. The remarks made by the honorable member for Mackellar are offensive to honorable members on this side of the House, and to me personally as theleader of the Australian Labour party. I ask that the honorable member be prevented from continuing, and be compelled to withdraw his offensive words. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- I think that since I asked the honorable member for Mackellar to restrain his remarks, his words have conformed to the general tenor of the remarks of other honorable members and can be answered. {: .speaker-JF7} ##### Mr Beazley: -- They always are in. the right. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! The honorable member forFremantle will withdraw that insult to the Chair. {: .speaker-JF7} ##### Mr Beazley: -- I withdraw. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- I reply to the point of order raised by the Leader of the Opposition by informing him that the Chair will decide whether or not an honorable member has offended. {: .speaker-DB6} ##### Mr WENTWORTH: -- It is generally thought that the leader of the Australian Labour party is elected by the Labour caucus. That, hitherto, has been the case, but I direct the attentionof honorable members to rule 9 ofthe federal constitution of the Australianlabour party, which reads - >On all questions affecting members of the Federal Parliamentary Labour party the decisions of the Federal Conference shall be final. Pending 'consideration by the 'Federal Conference, the ruling of the Federal Executive shall be binding. That means that if this council of twelve men decides who shall be the leader of the party, the puppets on my right will have to accept that decision, because their constitution, from which I have just quoted, binds them to vote in that manner. *Opposition members interjecting,* {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! I shall name honorable members who refuse to obey the call for order from the Chair.This is the last occasionon which I shall warn honorable members. {: .speaker-DB6} ##### Mr WENTWORTH: -- It may be that the right honorable member for Barton is trying to enlist the support of the left wing in the Labour party executive in the hope that, at some future time, it will name him as the leader of the Parliamentary Labour party. Under the provisions of rule 9, which I have just read, it is entitled to do so. We did not know until recently the extent of the influence and the dictatorial power to command which this executive has exercised over members of the Opposition. There is a third factor which, I think, is worthy of consideration. It may be that the right honorable gentleman, as he has done in the past, is bidding for a high office in the United Nations and that he would like to have the support of the Sovietbloc. I canvass all these possibilities because I am certain that the right honorable gentleman was not actuated by the hope of pecuniary gain. There is something else behind what has happened which I do not quite understand and which must explain the right honorable gentleman's extraordinary action. Can it be the hope of deriving some advantage? Can it be fear of his past association with certain people? Or can it be the vanity of wanting to be held up as a great constitutional authority, the Saint George who has gone to the rescue of the hapless Communist party when ithas been attacked by dragons in this House? {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! The honorable member's time has expired. {: #subdebate-29-0-s9 .speaker-KX7} ##### Mr WARD:
East Sydney .- L should not have taken any further part in this discussion had it not been that the words of the honorable member for Mackellar **(Mr. Wentworth)** may be regarded by some people as having, been uttered by a responsible member of this Parliament. Briefly, I want to advise honorable members of some of the activities of the honorable member for Mackellar, so that they will be in a position to judge how much attention should be paid to his remarks. The honorable member for Mackellar mentioned as one of the possible motives of the right honorable member for Barton **(Dr. Evatt)** that he wanted to " make his marble good " with the Communist party in case it should come to power in this country. Probably, that was the motive of the honorable member for Mackellar when,- on the south coast of New South Wales, he had an interview with Ted Roach, the Communist member of the Waterside Workers Federation, made a donation to strike funds, and provided a cup for a competition among the various unions in the 3ix-hour day demonstration which they hold there every year. When the honorable member wants to regale this House again, it will be much more interesting if, instead of allowing his fertile imagination to rill] riot in analysing other people's motives, he explains the motives that actuated him when he blew up the bridge at Cronulla and tried to demonstrate to General Blainey that the south coast could easily be captured in the event of a. Japanese invasion. He should also explain his motives for arming his platoon, section, or whatever he commanded, with live shells, and endangered the lives of real Australian soldiers so seriously that a permanent military officer had to warn bini to get away, or bo would shoot him. If the honorable gentleman does not do so. I shall probably relate on a future occasion the whole of this incident. Then there is the famous Dobson story. The honorable member is very lucky that he was. not brought up on a criminal charge with Dobson in the New South Wales court because when Dobson dipped himself in the harbour, and then said that he had been thrown off the Manly ferry some 3^ miles away by Communists, and had swum ashore, he had come from the residence of the honorable member for Mackellar, who had concealed him there overnight. The honorable member paid Dobson's telephone account, made provision for his office in the city, and paid his transport charges when he was running away from justice. This is the gentleman who tries to malign an honorable member of this House. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! I give to the honorable member the same warning that I gave, to the honorable member for Mackellar. He must restrain his language and not impute improper motives. {: .speaker-KX7} ##### Mr WARD: -- I think I have said sufficient to indicate that the people of this country can pay no regard whatever to what this " ratbag " utters. {: .speaker-DB6} ##### Mr Wentworth: -- I rise to order. I ask that the offensive statement that the honorable member for East Sydney has just made be withdrawn. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- The honorable member for Mackellar has complained of offensive remarks, and has asked foi- a. withdrawal of them. {: .speaker-KX7} ##### Mr WARD: -- I withdraw them. *Honorable members interjecting,* {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! Who is telling me to sit. down? {: .speaker-DB6} ##### Mr Wentworth: -- I wish to make a personal explanation. The honorable member for East Sydney has said enough to prove either that he is a damned liar, or that-- {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! I will not permit such remarks to be made in this House. I ask for a withdrawal of that term. {: .speaker-DB6} ##### Mr Wentworth: -- I withdraw it. The honorable member has been grossly misinformed, and, doubtless unwittingly, has given to this House information which is entirely untrue. Everything that he has said about **Mr. Dobson** is untrue. He said that on the night on which **Mr. Dobson** threw himself into the harbour- {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! The honorable member can only correct misrepresentations concerning himself. {: .speaker-DB6} ##### Mr Wentworth: -- I was accused of having harboured **Mr. Dobson** in my house that night. It so happened that I was out of Sydney at that time. {: .speaker-KGX} ##### Mr Haylen: **Mr. Haylen** *interjecting,* {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! I ask the honorable member for Parkes **(Mr. Haylen)** to leave the chamber until the Chair decides that he may return. He has been continually disobedient. _ I ask the Serjeant-at-Arms to remove him. I take this action under Standing Order 303. I will have silence in this House. The honorable member for Parkes must leave the chamber. *The honorable member for Parkes thereupon withdrew from the chamber.* {: .speaker-DB6} ##### Mr Wentworth: -- Everything that the right honorable member for East Sydney said regarding my connexion with Dobson is entirely untrue. I give the lie to every one of his statements. He mentioned other matters which also were untrue. I am sorry that I cannot recall them all. He mentioned an interview with Roach. So far as I can recall, I have never met that gentleman. It is true - and I have published the full circumstances myself- {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! The honorable member cannot speakabout any matter other than that on which he has been misrepresented. {: .speaker-DB6} ##### Mr Wentworth: -- It has been misrepresented that I made a donation to strike funds. It is true that I did help in regard to the pig-iron dispute. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! {: .speaker-DB6} ##### Mr Wentworth: -- I have published under my own name, the full circumstances of that matter, in both the Sydney and the local press. I have nothing whatsoever ' to conceal. As for the remainder of the garbled utterance of the honorable member for East Sydney,' all that I can say is that it is either the product of his fertile imagination or is based on information supplied by a sneaky, unreliable informer and is completely false. {: #subdebate-29-0-s10 .speaker-009MC} ##### Mr HOLT:
Minister for Labour and National Service and Minister for Immigration · Higgins · LP -- I do not propose to speak at any length. The Leader of the Opposition **(Mr. Chifley),** after casting a few more compliments in my direction, quoted in full a statement by the Leader of the Victorian Bar, **Mr. Reynolds,** K.C. I wish to say what my leader has already said very clearly to this House, namely, that I entirely subscribe to that pronouncement and invite any member of the Parliament to find, either in my statement last night, or in a statement that I made when a. similar issue was raised in this Parliament in 1936, anything that I have said at any time which questioned the right of a practising member of the legal profession, who was also a member of this Parliament, to practise his profession in the courts of this country. The Leader of the Opposition quoted with some emphasis this concluding passage - >Freedom of advocacy is one of the foundations of liberty. The advocate can never be suppressed. That principle is the" inspiration of the bar. That principle is also the inspiration of parliamentary government, and so long as j personally feel, while I am privileged to remain in this place, that I have a responsibility to discharge in this Parliament, I shall not allow the abuse of either the Leader of the Opposition or any of his colleagues, or any other brand of intimidation that they might try to use upon me, to deter me from saying what I believe I should say in this House. I have never at any time challenged the right of the right honorable member' for Barton **(Dr. Evatt)** to appear in the courts of this country. But he is here in a dual capacity. He is here as a member of the Parliament and as Deputy Leader of his party; he is also here as a member of the legal profession. What he does as a member of the legal profession may be his affair and that of those who care to brief him in the courts, but what bc does as Deputy Leader of the Parliamentary Labour party, whether he does it as a barrister, whether he does it as a private citizen, or whether he does it in this Parliament, is a matter which we, looking at the actions of a responsible public man in this country, are entitled forour part to examine and, if we so desire, to criticize. So I ask those in this Parliament who plead for the right of an advocate to speak without suppression - and I say that, for myself, I will always demand it - to ensure that they do not in turn try to suppress the right of any member of this Parliament to discharge his responsibility as he sees it. There are many occasions on which, we consider, issues should! be raised, the raising of which gives neither pleasure nor satisfaction. I have had them in this Parliament myself, and last night was one of them. I heard the . honorable member for Fremantle **(Mr. Beazley)** interject that I was always taking advantage of the absence of others to launch attacks upon them. I invite him to tell me of. the occasions on which I have launched personal attacks in this House and to tell me of any statement that I made concerning any absent member of this Parliament that I was not prepared to make to his face,, either inside this Parliament or outside of it.. I say in conclusion- An Opposition Member-. - The Minister has said enough. {: .speaker-009MC} ##### Mr HOLT: -- Perhaps I have said too much for the honorable member. I wish to make my position perfectly clear in this place. I am one whom the people of my electorate have sent here to represent them and to discharge my responsibility to them, and no manner of intimidation, neither threats nor abuse, on the part of honorable members opposite will deter me from doing what I think proper to be done. {:#subdebate-29-1} #### Mr.Beazley (Fremantle) [11.54;]. - Mr: Deputy Speaker- >That the question be now put. {: #subdebate-29-1-s0 .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Has the honorable member for Henty submitted a motion? {: .speaker-KFS} ##### Mr GULLETT:
HENTY, VICTORIA · NAT; UAP from 1931 -- Yes. {: .speaker-JF7} ##### Mr Beazley: -- I rise to order. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- There can be no point of order at this stage. There can be no debate on the motion " That the question be now put ", once it has been moved. {: .speaker-JF7} ##### Mr Beazley: -- There is a point of order upon the procedure adopted by the honorable member for Henty **(Mr. Gullett).** {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! I shall now put the question. Question put - >That the question be now put. The House divided. (Mr. Deputy Speaker - Mr.c. F. Adermann.) AYES: 45 NOES: 25 Majority . . . . 20 *In division:* AYES NOES Question so resolved in the affirmative. Question put - >That the House do now adjourn. The House divided. (Mr. Deputy Speaker - Mb. C. P. Adermann.) AYES: 0 NOES: 25 Majority . . . . 20 AYES NOES Question so resolved in the affirmative. {: .page-start } page 1557 {:#debate-30} ### PAPERS The following papers were presented : - >Commonwealth Public Service Act - Appointments - Department - > >Health - L. W. Wheeldon. > >Works and Housing - H. C. Green. > >House adjourned at 12.4 a.m. (Friday). {: .page-start } page 1557 {:#debate-31} ### ANSWERS TO QUESTIONS *The following: answers to questions were circulated: -* {:#subdebate-31-0} #### Commonwealth Advertisements {: #subdebate-31-0-s0 .speaker-BV8} ##### Mr Calwell: l asked the Treasurer, *upon notice -* {: type="1" start="1"} 0. What is thecost of the advertisements containing matter authorized by the Government and issued in the name of the Prime Minister, inserted in recent weeks in (a) the daily metropolitan press, (b) the daily provincial press, (c) provincial papers and (d) weekly newspapers and periodicals? 2.. What is the cost of each series of radio talks announcing Government policy made by the Prime Minister over the period dating from his recent return from overseas? 1. Were commercial stations directed to make these broadcasts or were arrangements made through the Commercial Stations Federation ? 2. Will similar arrangementsin regard to advertisements and radio broadcast talks be made available at government expense to the Leader of the Opposition? {: #subdebate-31-0-s1 .speaker-F4T} ##### Mr Fadden:
CP -- The answers to the honorable member's questions are as follows: - {: type="1" start="1"} 0. The only advertisement issued recently in the name of the Prime Minister was one which appeared in metropolitan dailies throughout Australia on the 3rd October, 1950, the cost of which was £3,979 16s. 2.. No cost was incurred by the Government in respect of national stations. The cost of land-lines made available by the PostmasterGeneral's Department to the commercial stations, amounting to £219 5s.6d. will be met from Commonwealth funds, in accordance with the practice which was observed under the previous Government. 1. Arrangements for the broadcast from commercial stations were made through the Commercial Stations Federation, under an arrangementof some years standing with the federation whereby the Prime Minister of the day may broadcast on national matters without charge. 2. During the course of these talks the Prime Minister stated that if the broadcasts contained any controversial matter, he would facilitate a broadcast by the Leader of the Opposition. Armed Forces. {: #subdebate-31-0-s2 .speaker-JWT} ##### Mr Francis:
LP s. - On the 18th October, the honorable member for Swan **(Mr. Grayden)** addressed a question to me in regard to air travel for Royal Military College cadets when they are proceeding on leave to their homes in Western Australia. I have looked into this matter and find that a general provision is made to enable members of the forces to return to their homes by rail or sea at public expense, once annually. During the Christmas break, Royal Military College cadets have approximately seven weeks' leave, and during short breaks in May and August, approximately seven days leave; but, generally, other members of the forces are granted three weeks' annual leave only. Royal Military College cadets receive their annual free travel warrant to cover the Christmas vacation. Staff cadets who live more than one night's journey beyond Perth or two nights' journey 'beyond Brisbane, however, are provided with air passages from Perth or Brisbane to their homes. During short breaks in May and August, staff cadets may go to their homes at their own expense, but, because of the shortness of the breaks, time does not permit cadets proceeding beyond Adelaide or Brisbane. The question of air travel has received careful consideration on a number of occasions, but, having regard to the fact that cadets are able to spend more time at home during their seven weeks Christmas leave than other service personnel during their three weeks' annual leave, and that it would be unfair to extend the special facilities to cadets and not to all service personnel proceeding on leave, approval for extra air travel for cadets cannot be granted. {:#subdebate-31-1} #### Taxation {: #subdebate-31-1-s0 .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP n asked the Treasurer, *upon notice -* {: type="1" start="1"} 0. What was the population of each State and of the Commonwealth at the 30th June, 1950? 1. What was the value of production of each State and of the Commonwealth for the year 1948-49? 2. What was the total amount of taxation for each State for the year 1949-50? 3. What was the total amount of taxation collected by the Federal Government for the year 1949-50? 4. What amounts were collected from direct and indirect taxation levied by the Commonwealth? {: #subdebate-31-1-s1 .speaker-F4T} ##### Mr Fadden:
CP -- The answers to the honorable member's questions are as follows : - NORTHERN TERRITORY {: #subdebate-31-1-s2 .speaker-JLZ} ##### Mr Anthony:
CP y. - On the 4th October, the honorable member for the Northern Territory **(Mr. Nelson)** asked a question concerning the. shipping and rail position at Darwin. The Minister for Fuel, Shipping and Transport has supplied the following answer: - >During my visit to the Northern Territory 1 examined the shipping position generally and held several conferences with members of the North Australian Workers Union, shipping agents, and others connected with shipping in the port. The main factor militating against full use of the port at the present time is, of course, the difficulties associated with wharfage accommodation. In this respect proposals arc in hand for the construction of a new wharf. Tenders were called for thi* recently, but unfortunately no firms have submitted tenders for the work. The matter is being further examined with n view to seeing what steps can be taken to provide a new wharf as early as practicable. > >I also took up, whilst in Darwin,- certain matters associated with the working of the port which were raised bv representatives of the union and others. Several of these have already been put in hand, e.g. lighting for the band yard, the provision of showers at the main jetty and sorting shed. Other mutters ure still under consideration. > >With regard to the shipping available for servicing Darwin, it is realized that the vessel at present carrying on the service on the eastern side, II. V. *culoairn* is not altogether suitable for the purpose and is costly to operate. However, it is the only vessel ut present available foi- this purpose and the Australian Shipping Board therefore has no option but to employ it in the Darwin trade. > >On matters affecting- the Commonwealth Railways i furnish the following information: - > >What steps arc being taken to recondition - (a) Permanent way - Despite . shortage of staff, the permanent way is maintained in safe condition. Action is in hand to obtain the services of new Australians to augment the track force. (4) Rolling stock - Action is in hand to modernize equipment on the North Australia railway. Tenders have been called, closing on the 14th November, 1950, for the supply of four diesel-electric locomotives, lt is the intention, if suitable tenders are received, to replace the existing steam locomotives entirely with diesel-electric power. Tenders have also been called for the supply of two modern diesel railcars, which are required to provide a frequent fast service for passengers, mails, and perishable traffic. The freight rolling stock in service is sufficient in numbers, types and condition for the traffic offering for carriage on the railways. > >What steps are being taken to improve the working and living conditions of the men employed on the railway- -A programme has been drawn up for the rehabilitation of all railway residences which are in reasonable order, and for the construction of residences for married employees and new quarters for tingle men. This programme is being pushed on as quickly as practicable, but is hampered by shortages of mcn and materials. Workmen have been sent to the North Australia railway from Port Augusta to hasten the improvement of living accommodation, and no effort is being spared to secure additional tradesmen for this work. Tn addition, arrangements are in hand to invite tenders for the construction *nf* houses

Cite as: Australia, House of Representatives, Debates, 26 October 1950, viewed 22 October 2017, <>.