House of Representatives
6 May 1952

20th Parliament · 1st Session

  1. House of Representatives
  2. 20th Parliament
  3. 1952

Mr. Speaker (Hon. Archie Cameron) took the chair at 3 p.m., and read prayers.

page 3

LYNE ELECTORAL DIVISION

Return to Writ: Mr. Philip Ernest Lucock Sworn

Mr SPEAKER:

– I have to announce that I have received a return to the writ which I issued on the 19th February, for the election of a member to serve for the electoral division of Lyne, in the State of New South Wales, to fill the vacancy caused by the death of Mr. Eldred James Eggins, and that, by the endorsement thereon, it is certified that Philip Ernest Lucock has been elected in pursuance of the said writ.

Mr. Lucock made and subscribed the oath of allegiance.

page 3

DEATH OF DON STEPHEN SEN AN AY ABLE

Mr MENZIES:
Prime Minister · Kooyong · LP

– Since the House met last we have all been shocked and grieved by the news of the death of the Prime Minister of Ceylon. I desire to submit to the House on this very sad occasion the following motion : -

That this House expresses its sincere regret at the death of Don Stephen Senanayake, who was at the time of his death Prime Minister of Ceylon, records its sensibility of the great loss sustained both by that dominion and the whole British Commonwealth as a result of his death, and extends to his widow and his family its profound sympathy.

Ceylon is one of the last of the great communities under the British Crown to achieve self-government. In the achievement of that self-government, not only the late Prime Minister, Don Stephen Senanayake, but also the entire Senanayake family, played a great part. The first Prime Minister of the new selfgoverning Ceylon was the man whose death we mourn to-day. A great number of honorable members of this House had the pleasure of meeting him when he was in Australia. I, myself, have had the pleasure of having a great deal of contact with him during the last two or three years and I should like to express on behalf of myself and of all honorable members our very sincere sorrow at his untimely dea.th and our warmest sympathy with his very distinguished and loving family.

The late Prime Minister of Ceylon was a man who worked and struggled hard to achieve complete self-government in his own country. But he did not believe that the achievement of selfgovernment was an end; he understood very, very clearly that it was a means of raising the living standards mid encouraging the future prosperity of his own people. All of us who knew him must have been very much struck by the fact that he had no time to waste on the battles of the past. All his time was devoted to the battles of the future to discovering how, when and where lie could do something for the good of his own people. In that respect lie was one of the distinguished democratic leaders of our own time; and the world can ill afford to lose any of its distinguished democratic leaders. He was a man who was forward-looking, who had no ambiguity in his mind about the substance and importance of the British Commonwealth but who, at all times, believed that his first duty was To promote the real interests and the real needs of his own people. I and, I believe, all honorable members had profound respect for him in that capacity. In our personal relations I had the deepest affection for him. He was a man in every sense of the word. He was an all-round man. He had played his part in sport and in serious affairs, and he had played his” part in Ceylon and in the world. Throughout all his activities he had an almost boyish humour, a good nature, u friendliness and yet a firmness which 1 ;im perfectly convinced laid hold of the people he knew so well and produced in them a feeling of profound affection.

I should like to say on behalf of the Parliament to the Government and the people of Ceylon how much we value the work he did and how much we mourn his death. I think I may be permitted to add that we have some feeling of personal satisfaction in the knowledge that his son is the new Prime Minister of Ceylon and that a great family tradition is being woven into what I am sure will bp a great national tradition.

Dr EVATT:
Leader of the, Opposition · Barton

– On behalf of Her Majesty’s Opposition I second the motion. I endorse the remarks of the Prime Minister (Mr. Menzies). The sudden, tragic death of Mr. Senanayake adds to a list of statesmen the passing of whom has been a tremendous loss to the British Commonwealth during a comparatively few number of years - Mackenzie King of Canada, Smuts of South Africa, Fraser of Kew Zealand, Chifley of Australia and Liaquat Ali Khan of Pakistan. We do well to pay honour to the work and memory of the late Prime Minister of Ceylon and to extend our heart-felt sympathy to his family and to the people of Ceylon.

The Prime Minister of Ceylon fought hard for self-government for hia country as a member of the British Commonwealth, and helped to negotiate a very difficult period in the constitutional history of the British Commonwealth. He also fought hard for the welfare of his people. He was a big man physically and in every other way; he had broad vision, and was tolerant and wise. He was the man for the job in a great crisis. He had a deep feeling for the people of Australia. It was a great honour to bc associated with him, as some of us were, during earlier periods, and he was intensely grateful to the people of this country for the economic help that came to Ceylon in a time of great crisis during the last war. I feel sure that his work will help to bind his country to ours, and to the British Commonwealth, for untold years to come. It is a great honour to associate myself with the motion submitted by the Prime Minister.

Question resolved in the affirmative, honorable members standing in their places.

page 4

DEATH OF M. GABRIEL PADOVANI

Mr MENZIES:
Prime Minister · Kooyong · LP

– Within the last few days, we have learned of the death of the Ambassador of France in this country, M. Gabriel Padovani, who had been with us for three years. There may be many people who did not have the opportunity to meet him during that period, but there are many members of this House who met him and acquired a special feeling in relation to him. lt has not been a frequent happening in the history of a country that an ambassador accredited from a foreign power dies in the country to which he is accredited. The death of M. Padovani was entirety unexpected, and it is profoundly regretted by everybody who knew him. Australia, in comparison with some countries, has not a long international history,, but it has had during this century the deepest and closest associations with France - in difficulty and then in triumph in World War I., in disaster and then again in triumph in World War II. I do not need to emphasize how profoundly concerned everybody in this House is with the future of France as a great European power, with the significance of France in the achievement of balance and peace in the world, and, in particular, with our relations with France in South-East Asia and in the islands of the South- West Pacific. Wc have had the honour and the pleasure of having several representatives of France since we have exchanged diplomatic missions with that country, and during the- last three years we have had in M. Padovani a gentleman of experience, understanding, humour and a quiet but persuasive personality who has achieved much in the relations between the two countries, which owe to each other the duty and privilege of friendship, because of their traditions of culture and their mutual passion for peace and tranquillity in the world. Therefore, I express to the members of the family of M. Padovani who are so far away from us, the mutual and unanimous feeling of this House of sorrow at his death and of appreciation of the work that he has done in this country to consolidate the friendship which is of such importance to aH of us. With these thoughts, I move -

That this House expresses its deep regret lit the death of M. Gabriel Padovani, for three years Ambassador of the Republic of Franc in this country, and tenders its sincere sympathy to his wife and family in their bereavement.

Dr EVATT:
Leader of the Opposition · Barton

– I second the motion. Few happenings could be sadder than the sudden death of the French Ambassador so far from his homeland and his family, and the Opposition joins in the tribute that has been paid by the Prime Minister (Mr. Menzies) to M. Padovani. whose work was of great value in diplomatic circles in Canberra. I think that his last official act as. ambassador was to- lay a wreath bearing the tricolour of France on the Stone of Remembrance at the Australian National War Memorial at Canberra on Anzac Day. That wreath was a reminder to us of something that we tend to forget - the close association of Great Britain and Australia with France throughout all the great struggles of World War I., in which the Gallipoli campaign figured so prominently. The Opposition feels a deep sense of loss at the death of this distinguished Frenchman, and I hope that our unanimous expressions of sympathy will be some small consolation to his family and to the Government that he served so long and so faithfully.

Question resolved in the affirmative, honorable members standing in their places.

page 5

BILLS RETURNED FROM THE SENATE

The following bills were returned from the Senate without amendment: -

Treaty of Peace (Japan) Bill 1952. Security Treaty (Australia, New Zealand, and the United States of America) Bill

Fisheries Bill 1952. Pearl Fisheries Bill 1952.

page 5

ASSENT TO BILLS

Assent to the following bills reported: : -

Ministers of State Bill 1952. Parliamentary Allowances Bill 1952. Parliamentary Retiring Allowances Bill 1932.

Income Tax and Social Services Contribution

Assessment Bill 1952. Treaty of Peace (Japan) Bill 1952. Security Treaty (Australia, New Zealand and the United States of America) Bill

Fisheries Bill 1952. Pearl Fisheries Bill 1952.

page 5

QUESTION

SECURITY LOANS

Dr EVATT:

– Will the Treasurer include in the financial statement, which, I understand, he will make to-night, particulars of contributions, including official and semi-official contributions, made to the Fifteenth Security Loan ?

Sir ARTHUR FADDEN:
Treasurer · MCPHERSON, QUEENSLAND · CP

– I am sure that the Leader of the Opposition knows that it is not the practice, nor is it desirable, to disclose particulars of loan subscriptions.

Mr Calwell:

– Why not?

Sir ARTHUR FADDEN:

– It was never done during the eight years of Labour government.

page 6

QUESTION

TAXATION

Mr BRIMBLECOMBE:
MARANOA, QUEENSLAND

– I direct the Treasurer’s attention to an apparent anomaly in the collection of income tax at Manus Island. Whereas wages and salaries of employees of the Department of Works and Housing are exempted from income tax, servicemen are required to pay income tax on their pay and allowances. Will the Treasurer investigate the matter with a view to removing this apparent injustice?

Sir ARTHUR FADDEN:
CP

– The situation touched upon by the honorable member arises from the implementation of the Income Tax Assessment Act 1936- 1952. Income derived in the Territory of New Guinea - and that, of course, includes Manus Island - does not come within the provisions of the act when derived from sources in the territory. Government employees receive differential treatment because of special considerations, but the whole matter is now being investigated in order to determine what can be done about it. I point out, however, that the situation has existed ever since 1936.

Mr GRIFFITHS:
SHORTLAND, NEW SOUTH WALES

– Can the Prime Minister say whether anything has been done to expedite the hearing in the High Court of the case, Commissioner of Taxation v. Fletcher Clarence Dixon, or in respect of the general subject of the taxation of servicemen’s made-up pay? Does he remember receiving correspondence on this matter last September from a branch of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia to which some weeks later hp replied -

I am informed that the Crown Law authorities are doing all that is possible to hasten the hearing and it is confidently expected that the case will be heard this month.

In view of the fact that more than six months have elapsed since it was expected that that case would be heard and as many ex-servicemen are unable to have their accounts with the Taxation Branch finalized, will the right honorable gentleman see what can be done to have that case expedited ?

Mr MENZIES:
LP

– I shall certainly act upon the honorable member’s suggestion. Of course, I, personally, have no knowledge of the progress of the proceedings to which he has referred, but I shall ascertain the position from the Crown Law authorities this afternoon and advise him to-morrow.

page 6

QUESTION

CONSTITUTION ALTERATION

Mr COSTA:
BANKS, NEW SOUTH WALES

– Has the Prime Minister taken any notice of the statement that was made by Sir John Latham at the time of his retirement from the Chief Justiceship of the High Court of Australia. Sir John said that it was about time that consideration was given to bringing the Australian Constitution up to date. He also said that section 92 of the Constitution should be mad a a little clearer. It is obvious to everybody that this should be done because of the conflicting nature of judgments by members of the High Court bench from time to time. Other matters which Sir John Latham suggested for review were the financial relations of the Commonwealth and the States, and section 51 of the Constitution, which deals with the industrial powers of the Commonwealth. Will the Prime Minister consider taking action to have the Constitution reviewed oil a non-party basis as Sir John Latham has suggested? I believe that the Prime Minister will agree that most thinking people are of the opinion that the Constitution is a “ horse and buggy “ affair at present and that, until it is modernized, many of our important national problems will remain unsolved.

Mr SPEAKER:

– Order! The honorable gentleman’s question is becoming rather lengthy and it includes a good deal of comment.

Mr COSTA:

– Will the Prime Minister give this matter some thought with a view to taking early action?

Mr MENZIES:
LP

– I read the reported remarks of the former Chief Justice of the High Court with great interest, and, of course, with great respect. The problems that he referred to are very much in my mind and very much under consideration by the Government. The whole trouble about these constitutional problems, of course, is that from day to day one grows hot and cold and hot and cold. It is very difficult to strike a happy medium.

page 7

QUESTION

WATERFRONT EMPLOYMENT

Mr FALKINDER:
FRANKLIN, TASMANIA

– The Minister for Labour and National Service undoubtedly is aware that a very serious position lias arisen on the waterfront in Tasmania in relation to the fruit export season, which is very restricted. Has the Minisler any information concerning action that may be taken to alleviate the situation?

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

– We have been giving active attention to the problem that has arisen at Hobart. The honorable member has asked what action may be taken to alleviate the situation. The most useful action that could be taken would be for the Waterside Workers Federation to lift its ban on the working of overtime, particularly at Hobart, where, as the honorable member has pointed out, the loading season for the apple crop is very short. We have tried to improve the position in various ways, such as by attracting labour from the mainland and from other ports in Tasmania that are not fully engaged at this time. However, these are only palliatives. The Australian Council of Trades Unions, through its secretary, Mr. Broadby, also has tried to obtain the co-operation of the Waterside Workers Federation but so far it has been unsuccessful. I remind the House that important legal proceedings which have a bearing on this matter, and on other ports as well, are at present in train before the Commonwealth Court of Conciliation and Arbitration.

page 7

QUESTION

DRUGS

Mr GEORGE LAWSON:
BRISBANE, QUEENSLAND

– Is the Minister for Health aware that, owing to the import restrictions that have been imposed by this Government, imports from overseas of urgently needed vitamins will be considerably reduced? Does he know that Vitamin E, discovered by the Shute Foundation for Medical Research, has an amazing effect upon people suffering from heart ailments and that at the present time many thousands of sufferers from these ailments are being treated with this vitamin, with extraordinarily good results? Owing to the Government’s import restrictions, Vitamin E now is in desperately short supply in this country. In view of this serious position, will the right honorable gentleman take steps immediately to ensure that the import restrictions that have been imposed upon this important commodity will be relaxed?

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

– The importation of drugs that are indispensable in the treatment of human diseases has been carefully considered. The list of drugs of that kind that are in short supply in this country has been continually brought to the notice of the Minister for Trade and Customs, who is giving very sympathetic consideration to the matter. Doubtless, the honorable gentleman will bt! glad to learn that the drug that he has mentioned is now being made in Australia and, therefore, there is no need to wory about importing supplies of it.

page 7

QUESTION

IMMIGRATION

Mr WILSON:
STURT, SOUTH AUSTRALIA

– Has the attention of the Minister for Immigration been directed to complaints that have been made by residents of Gepp’s Cross immigrant hostel about charges for board? Will the honorable gentleman give urgent consideration to the request made by those residents that kitchenettes be installed at the hostel in order that they may cook their own meals?

Mr HOLT:
LP

– I am aware that complaints have been made about the recent increase of charges to residents in the Gimp’s Cross hostel. I point out to the honorable member that no other increase ha? been made since July of last year, although during that time not. only have the operating costs of the hostel increased considerably but also the basic wage has risen by approximately 40s. Therefore, it is only reasonable to insist that some portion of the increased operating costs shall be passed on to the residents of hostels of this kind. The Governnent is anxious that the charges shall be fair and reasonable, but we must have regard in this matter to the interests of the Australian taxpayers. I remind the honorable member that, for the next financial year, an appropriation of nearly £1,500,00 has been made to meet concessional allowances for immigrants and their dependants who are living in hostels. In the circumstances, it cannot be claimed that the present charges are unduly high. The installation of kitchenettes raises a very difficult question. We have already given some consideration to the matter. I know that a specific scheme has been prepared in relation to the Gepp’s Cross hostel, in which the honorable gentleman is interested. I give him an undertaking that the matter will be fully examined.

Mr MINOGUE:
WEST SYDNEY, NEW SOUTH WALES

– In view of the acute shortage of houses in> all States and the present indication of widespread unemployment, due to the Government’s credit restriction policy and the provision of insufficient loan funds for public works, will the Minister for Immigration state the number of immigrants that he intends to bring to this country within the next twelve months?

M.r. HOLT. - The Government has already announced its plans- for the ensuing twelve months and I can supply details of them, if desired, in a detailed statement. The Government does not intend to reduce substantially the rate of flow of immigrants that has obtained for some time. I am not aware that there has been any opposition on the part of honorable members opposite to the programme, that the Government has announced. When this programme was announced at the Citizenship Convention which was held in January not only did it receive broad endorsement by representatives of the Opposition who were then present, but it received the enthusiastic endorsement of the very representative gathering of Australian community leaders who were there present. The Government proposes to provide wider opportunities for employment in Australia by bringing immigrants with essential skills to this country. At present, although many thousands of vacant positions are on record, the number that can be filled is limited by the availability of .skilled workers who are necessary in order to enable the unskilled workers to be used. At the Sunshine Harvester works in Victoria, for instance, there are 800 vacancies, but this figure includes vacancies for hundreds of unskilled workers whose services cannot be used until the company has obtained a large number of skilled workers. Consequently, one of the means whereby opportunities can be created for the employment of unskilled workers in Australia is the bringing of skilled tradesmen from overseas.

Mr DAVIES:
CUNNINGHAM, NEW SOUTH WALES

– I address a question 10 the Minister for Immigration relating to the frequent stabbing affrays that have taken, place recently at or in the vicinity of .government hostels for immigrants. .1= he aware that many European immigrants carry knives on their person and are a constant danger to decent, citizens? In view of the fact that British and Australian citizens arc prosecuted and suffer heavy penalties if they are found with fi rearms in their possession, will he consider the advisability of taking steps to stop this dangerous practice on thu part of European immigrants which, I repeat, creates fear in the minds of many citizens?

Mr HOLT:

– Instead of generalizing in a way which brings discredit upon a body of people who, with very few exceptions, are settling into community life in this country in a manner which brings great credit upon them, the honorable member would render greater assistance if he were to give details of any instance!; about which he has complained and which have come to his notice. He has asked what action can be taken to deal with European immigrants who are involved in affrays in which they use knives. 1 assure him that action has already been taken in instances that have come to the notice of the department. Considerable publicity on the matter has been given in journals that are circulated amongst immigrants, and in cases that have been brought to my attention I have made it dear that I have power to deport persons who are convicted of serious offences. T assure the House that such power is exercised where considered appropriate in instances of the kind that the honorable member has mentioned. If lie will supply me with details of any particular ease that has come to his notice, I assure him that anything I can do will be done, to protect the community generally.

page 9

QUESTION

BANKING

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

– -Recently the Prime Minister made a statement to the effect that the Government would ensure that the Commonwealth Bank, in fair competition with the trading banks, would be developed as an essentia] part of the commercial banking structure of this country. Will the right honorable gentleman, in further explanation of that statement, say whether it is proposed that “ f ai r competition “ shall include the establishment of a branch of the Commonwealth Bank in every centre in which private banks are operating, and the fixation of the rate of interest upon advances on the basis of what is within the capacity of the Commonwealth Bank to offer, thus ending the present arrangement whereby thi’ trading banks fix a uniform rate of interest by agreement? If it is not proposed by the Government that the Commonwealth Bank shall follow this course, will the Prime Minister state precisely what he means by “fair competition”?

Mr MENZIES:
LP

– lt would be quite foolish for me to say that fair competition connotes the establishment, of a branch of the Commonwealth Bank in every place in which some trading banks have branches, because I do not know, and the honorable member does not know, whether fair competition requires such action. Whether a bank or a business establishes a branch in a particular place depends entirely on the volume of business available in that particular place. I am not prepared at this moment to discuss the question that the honorable member has put to me concerning interest rates. All I shall say is that fair competition to my mind connotes that no advantage shall be conceded to the Commonwealth Bank which is denied to trading banks, and that no burden should be placed upon the trading hanks which is not placed upon the Commonwealth Bank.

Mr JOSHUA:
BALLAARAT, VICTORIA

– I ask the Treasurer whether managers of branches of the

Commonwealth Bank are compelled to abide by the advances control policy communicated to all trading banks by the Governor of the Commonwealth Bank ? If the answer is in the affirmative, will the right honorable gentleman take action to stop the campaign, of misrepresentation that is being conducted at present by certain sections of the press and community?

Sir ARTHUR FADDEN:
CP

– The answer is in the affirmative, and certain action has been taken. The co-operation of the trading banks is desired in all matters, particularly in our present economic circumstances.

page 9

QUESTION

PASSPORTS

Mr ROBERTON:
RIVERINA, NEW SOUTH WALES

– Is the Minister for Immigration aware that the issue of passports which will permit five Australian nominees of the All-China Communist Federation of Labour to visit Peiping for the purpose of attending an alleged conference is causing grave public concern? Since conferences of the kind are convened by the enemies of democracy to plot the destruction of democracy, can the Minister advance any sound reason for the issue to delegates from this country of passports that will allow them to take part in those nefarious proceedings? Are passports freely issued by the Soviet Union to persons who desire to escape from the terrors and persecutions of communism? Should the five Australian delegates be refused permission to leave Peiping, or should they be induced to visit Siberia on a protracted visit, as so many other people have been induced to do, is it proposed that this country shall go to war to effect their extradiction ?

Mr HOLT:
LP

– The honorable member has asked me whether I can offer any good reasons for the events which have occurred. There are a number of important reasons which should immediately be brought under his notice. First, it has been the practice of British countries to permit their own citizens to travel freely, that is, without any restriction being placed upon them by their own country, in any part of the world. Secondly, the Australian Government has at this time no power to prevent any of its citizens from travelling, in time of peace, to any other part of the world to which they may desire to travel. Thirdly, it has been the invariable practice, so far as I am aware, to grant passports to Australian citizens upon request. The only exception to that practice which has come under my notice was not really an exception in that it related to an Australian citizen who had renounced his Australian nationality and who was therefore not issued with an Australian passport. In accord with such considerations every Australian citizen is issued with a passport as a matter of right. Some time ago the Government endeavoured to discourage visits by Australians to Communist countries by including in the Australian passports a provision that the passport itself was not valid for use in specified countries. It was found in practice that this procedure did not have the result of restricting the travel to those countries of any persons who were acceptable to the countries concerned, and the net effect of its application was that some Australian citizens who had no Communist affiliations or views, but who were travelling in Europe, found that they were placed at some inconvenience, whereas other people whom the Government might have thought to discourage were not similarly inconvenienced. Consequently, it was decided, after consultation with our security authorities, to revise the procedure. The Australian passport still contains a provision that it is not valid for certain specified countries, but upon application by any person holding a passport and a notification by that person of the broad intention behind the proposed visit, the passport is made valid for use in the country concerned. Admission to that country does not, however, rest upon the issue of the passport by us, but is a matter for decision by the country to which the person proposes to travel. We have no power to restrict the movement of our own citizens from Australia, but we have power to restrict the entry of other people to this country and that power has been exercised in cases to which its application has been considered appropriate.

Mr BERNARD CORSER:
WIDE BAY, QUEENSLAND

– I ask the Minister for Immigration whether the obligation to grant passports to traitors who wish to attend certain conferences is governed by the Australian Constitution or by the Parliament and its enactments ? If the latter be the case, will the Minister consider the introduction of amending legislation to safeguard the security of this country from joining saboteur and gunzens from joining saboteur and gunman representatives of countries that are virtually at war with Australia to-day and are acting to the detriment of the British Commonwealth of Nations and its allies?

Mr HOLT:

– My own understanding of the matter is that while we have general authority under the defence power to deal with this matter in time of war, no power exists in peace-time, that is at the present time, to enable this Parliament to legislate to prevent the movement of its own citizens from Australia to othercountries. In any event the honorable member’s question has raised a matter of important principle which would have to engage the close attention of the Government if it were to consider adopting a course which so far has not been adopted in any other British country. There have been consequences in individual cases such as those to which the honorable member has referred, but I point out that practical difficulties arise. Last year, for instance, which was a typical year, over 100,000 Australians left Australia to travel outside our shores. The honorable member will appreciate the tremendous practical and administrative difficulties that would occur in time of peace in attempting to investigate the private affairs and politics of all persons who apply for passports, and the other issues involving the overseas governments concerned, which would have the effect of restricting the movements of some such applicants.

page 10

QUESTION

GOVERNMENT LOANS AND FINANCE

Mr DRAKEFORD:
MARIBYRNONG, VICTORIA

– In view of the unanimous vote of the State Premiers at the recent meeting of the Australian Loan Council in Canberra against the

Government’s financial proposals and the adverse public criticism that those proposals have aroused, will the Treasurer reconsider the position and seek other means than those so far proposed to enable the works programmes of the States to be carried out and thus facilitate the increase of primary production that is essential to correct the unsatisfactory economic position into which Australia has been allowed to drift? If other means of correcting the position are not to be applied immediately, will he call another meeting of the council as early as possible so that this matter of great public importance may receive enrly consideration ?

Mr SPEAKER:

– The question relates to a. matter of policy.

Sir ARTHUR FADDEN:
CP

– The matter mentioned by the honorable member is one entirely for the Australian Loan Council.

page 11

QUESTION

TEXTILES

Mr OPPERMAN:
CORIO, VICTORIA

– During the last sessional period of this Parliament I asked the Minister for Supply whether he would give consideration to the placing of further government orders to assist the textile industry during its present difficulties which have been caused by heavy importations of goods from abroad. Although I know that import restrictions introduced by this Government since that time have been of great benefit to the textile industry, it is understood that there is yet wider scope for the placing of further government orders. Will the Minister indicate whether he has been able to do anything about this matter?

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

– -I remember that the honorable member raised this matter in this House before the end of the last sessional period of the Parliament, and I have already taken certain action. I hold the view that it would be unfair to take up the time of honorable members during question time in giving an answer, which would of necessity be lengthy, to the honorable member’s question. Therefore I shall ask for leave to answer the honorable member at the conclusion of question time.

Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES

– Having regard to the reply that the Minister for Commerce and Agriculture gave to the honorable member for Fisher, is it not a fact that the Australian Hides and Leather Industries Board, until the judgment of the High Court was given recently, was responsible for the gathering and marketing of hides in Australia? Is it not a fact that prior to the operation of that board, the primary producers were entirely in the hands of the merchants who paid them whatever price they liked to pay for their hides? Did not those merchants and their agents initiate litigation in the High Court in order to get an open go again at the primary producers ? Further, does the Minister think that he is acting in the interests of the people by attempting to get the State Ministers in charge of prices to increase the price of hides rather than to deal with the price of leather in respect of which the real exploitation is going on at present?

Mr McEWEN:
Minister for Commerce and Agriculture · MURRAY, VICTORIA · CP

– I have no doubt that the honorable member is correct, historically, in saying that before the Australian Hides and Leather Industries Board commenced operations there was an open market for hides in Australia as there was, and as there is to-day, in respect of most primary products in this country. However, I am right in reminding him that the board is obliged to operate under the schedules of prices stipulated by the State Ministers in charge of prices. The price of hides to-day is the same as it was in 1939 and to my knowledge hides are the only product in respect of which no adjustment of price has been made in the interim. I believe that I am acting in the interests of the primary producers and in the public interest in requesting the State Ministers in charge of prices to make a fair adjustment in the price of hides.

Later:

Mr BEALE:
LP

– I ask for leave to give a deferred answer to a question by the honorable member for Corio about textiles.

Mr Rosevear:

– Wait until questions are over.

Leave not granted.

Mr BEALE:
Minister for Supply · Parramatta · LP

– by leave - The honorable member for Corio (Mr. Opperman) and other honorable members have raised the question of the practicability of advancing textile orders for defence requirements with the object of helping the textile industry out of its present difficulties resulting from the heavy importation of textiles from abroad. I asked a committee representative of my department and the services departments to examine this matter and to advise me upon it. I am advised that the department’s ability to help in this respect is limited. At the most, Government requirements do not absorb more than 10 per cent, of Australia’s textile production. The majority of out heavy orders have already been placed and ordering from now on will dimmish unless the Government decides to accelerate its defence expenditure. On that matter, 1 cannot make any forecast. But, there are some textile requirements of the services which lend themselves to rearrangement and wherever possible we are moving forward those orders in the interests of the industry. There, are not many ‘orders of that kind; they would represent only a small proportion of the L0 per cent, of Australian production to which I have referred. However, very heavy orders have been placed and most of them are still current.

Mr Ward:

– I rise to order. Is it in order for a Minister to give a reply to a question that an honorable member asked some time previously w”hen that honorable member is not present in the chamber ?

Mr SPEAKER:

-The Minister is in order. He asked for leave to make a statement, and the granting of leave for that purpose provides about as wide an opportunity as can be given to a Minister to deal with a subject.

Mr Rosevear:

– With respect, Mr. Speaker, I think that the Minister asked for leave to answer a question.

Mr SPEAKER:

– I understood that he asked for leave to make a statement.

Mr BEALE:

– I asked for leave to make a statement. However, we shall not quarrel about the form of it. In the interests of honorable members themselves, I did not make this statement during question time, because of its length. With your permission, Mr. Speaker, I shall continue.

Mr SPEAKER:

– I understood that leave was granted unconditionally to the Minister.

Mr Rosevear:

– No. The Minister granted leave to answer :a question.

Mr SPEAKER:

– Order ! I ask the Minister to resume his seat. When a question, even a question without notice, is asked in this chamber, there are few curbs upon the opportunity of the Minister in using his discretion in answering it. When a Minister is granted leave to make a statement or if, as has been alleged by the Opposition in this instance, is granted leave to answer a question, I do not propose to impose any curbs upon his reply. The House, if it does not desire to hear him, has its remedy.

Mr ROSEVEAR:

– I rise to order, ls there not a vast difference between the right of a Minister to answer a question, and the granting of leave to him to make a statement, because debatable matter must not be introduced into the question or into the answer, but debatable matter may enter into a statement that is made by leave? I mention, in fairness, that I think that the Minister asked for leave to answer a question, and leave was granted to him to do so; but he is now making a statement that may contain ji great deal of debatable matter. Certainly it is not an answer to a question.

Mr SPEAKER:

– The submission ot the honorable member for Dalley is quite correct to this degree: that the Standing Orders provide that debatable matter may not be introduced into a question or into an answer. That Standing Order, I am sorry to say, is sometimes disregarded. However, when leave is granted to a Minister to answer a question or to make a statement, his opportunity to deal with that particular subject is fairly -wide. At any .rate, that is my view, and there I stand. I ask the Minister to continue.

Mr BEALE:

– I do not desire to take any advantage of the form in -which leave was granted to me. If honorable members opposite want to discuss this matter, I. for my part, will facilitate the discussion. I am seeking to make this statement in the interests of honorable members on both sides of the chamber, because the House will recall that members of the Labour party as well as Government supporters have asked questions about the matter of advancing textile contracts in order to help the textile industry, and, in particular, the workers in that industry who have been affected. I repeat that there are some textile requirements of the Services which lend themselves to rearrangement, and, wherever possible, we are moving them forward in the interests of the industry. There are not many of them, and they would represent only a small percentage of the 10 per cent, production which, as [ have mentioned, was the only part in which the Department of Supply was interested. However, very heavy orders have been placed and most of them are still current, so that the industry is still getting the benefit of having the Government as a large-scale customer at this difficult time. For instance, since the commencement of factory operations this year until the middle of April, we delivered to the Army 116,000 shirts, and deliveries are now being made at the rate of 13,000 a week. During the same period we delivered 63,000 pairs of drill trousers and are now delivering 5,500 a week. This production will increase. In the field of textiles we delivered 234,000 yards of serge, 116,000 yards of khaki waterproof cloth, and 21,000 yards of blue barathea cloth. Heavy deliveries of those materials are continuing. Similarly, we have delivered 33,000 greatcoats. 68,000 battledress blouses and 72,000 battledress trousers. The deliveries of those articles are still continuing. Many members of the textile industry have not shared in these orders, hut the House will remember that the Department of Supply cannot arbitrarily allot its contracts to all manufacturers. Generally, contracts arc let to the lowest tenderer, and even when we use the industry price system instead of the lowest tender system, inevitably the position is that although many may be called, few are chosen. But we are doing what we can to help, and we believe that the recently imposed import restrictions will be of great assistance to the industry.

page 13

QUESTION

SOCIAL SERVICES

Mr LUCHETTI:
MACQUARIE, NEW SOUTH WALES

– Is the Minister for Social Services aware of the desperate plight of recipients of pensions because of the increasing cost of living? If he is aware of the present circumstances of such persons, is he prepared to recommend to the Cabinet that st’-ps should be taken to alleviate their distress? Will he also recommend easing the means test and increasing considerably the pensions of persons who are so sorely in need?

Mr TOWNLEY:
Minister for Social Services · DENISON, TASMANIA · LP

– As the honorable member appreciates, all the matters that he has raised are matters of policy. They will be considered by the Cabinet at the appropriate time. The House will then be informed of the measures to be taken. This Government is acutely aware of everything that is happening to pensioners, and it is also aware that certain people are using the plight of pensioners for their own political ends.

page 13

QUESTION

JAPAN

Mr BERRY:
GRIFFITH, QUEENSLAND

– Can the Minister for Supply inform the House whether the Government has let to any firm in Japan a contract for the manufacture of uniforms or other equipment for the armed services? I ask this question in view of the fact that it has been brought to my notice that, several trade union journal.6 have-

Mr SPEAKER:

-Order ! The honorable gentleman may not base question? on newspaper paragraphs.

Mr BERRY:

– My question is not based on a newspaper paragraph. It wa.« a trade union journal.

Mr SPEAKER:

– Order ! The honorable gentleman cannot proceed along those lines.

Mr BERRY:

– I omit the latter part of my question and merely ask whether the Government has let to any firm in Japan a contract for the manufacture of uniforms or equipment for the armed services of Australia?

Mr BEALE:
LP

– Although I did not know that the honorable member intended to ask me this question, I am delighted that he has done so because I am glad to inform the House, and also the country, that this Government has never, as far as my department is concerned, let to Japan contracts for the supply of made-up garments.

page 14

INDUSTRIAL ARBITRATION

Mr JAMES:
HUNTER, NEW SOUTH WALES

– Will the Prime Minister state whether it is a fact that during the regime of the two previous Labour governments considerable industrial trouble was experienced because of continuous appeals to the Commonwealth Arbitration Court, against awards made by the conciliation commissioners, by a wellknown person by the name of-

Mr SPEAKER:

– Order ! Any question concerning the activities of a person outside the House must go on notice.

Mr JAMES:

– I shall leave his name out. Because of the delay caused by appeals against the decisions of the court the Labour party amended the act in order to make decisions of a conciliation commissioner final and binding. Surely the recent press reports are not correct that the Government proposes-

Mr SPEAKER:

– Order ! The honorable gentleman is right out of order in his press references. Does the Prime Minister wish to reply?

Mr Menzies:

– No.

page 14

QUESTION

POLIOMYELITIS

Mr PEARCE:
CAPRICORNIA, QUEENSLAND

– I preface a question to the Minister for Social Services by saying that the Poliomyelitis Committee of the National Health and Medical Research Council recently stated that a large proportion, of severely disabled persons left in the wake of the recent poliomyelitis epidemics are in the 15 to 30 years age group and that those persons will eventually gravitate to homes for incurables unless means are devised for their rehabilitation. Will the Minister urgently consider waiving the application of the means test when, notwithstanding medical necessity, it debars persons suffering from poliomyelitis from receiving social service.1 and rehabilitation benefits?

Mr TOWNLEY:
LP

– Under the Social Services Consolidation Act which I administer, I have no discretionary power to take the action that has been sug gested by the honorable member for Capricornia. However, his suggestion has much merit and I shall be very pleased to consider it and ascertain if anything can be done along those lines.

Mr NELSON:
NORTHERN TERRITORY, NORTHERN TERRITORY

– Is the Minister for Health aware that an outbreak of poliomyelitis recently occurred at Alice Springs and that as the hospital at that town is without an isolation ward a dangerous situation has arisen? As the hospital serves not only the whole of central Australia but also the northern areas of South Australia, will the Minister take immediate steps to have an isolation ward provided at the hospital in order to safeguard the health of the people of those areas?

Sir EARLE PAGE:
CP

– I shall ascertain whether it is practicable to comply with the honorable member’s request.

page 14

QUESTION

BOOKS

Mr BIRD:
BATMAN, VICTORIA

– Can the Prime Minister inform honorable members whether it is a fact that Australia will need to import more books in the coming year than in the past because our schools, universities and libraries are at present straining as badly under the pressure of the population bulge as are our other services? If this is so, will the Government consider reviewing its decision to limit future book imports to the value of the 1950-51 sterling level in view of the fact that since that year, book prices abroad have increased by at least 25 oper cent, and this, under the present regulation, must necessarily mean a decrease in the number of books to be imported?

Mr MENZIES:
LP

– The honorable member’s question does not really concern me directly. It should be addressed to the Minister representing the Minister for Trade and Customs. However, I can say to the honorable member that this Government has no desire to reduce the importation of books into Australia. Tt attaches very great importance to the importation of books and to the. availability of books generally. However, the problem that has given rise to the import restrictions or to import licensing is the availability of overseas exchange with which to pay for the books that are imported. That is the dire problem of international currency. What the Government decided was that in the case of books, there should be no reduction in the value of books that were imported during the base year. The honorable member has suggested that there should be a departure from the principle of values, but what basis does he suggest as an alternative? Has he the basis of quantity in mind? I can see no way of working out the importation of books on a quantity basis, because the value of individual books changes and books differ very much, in price. Doing the best that it can and having regard to the overall problem, the Government h.is given the most favorable possible treatment to the importation of books. It has determined that the value of books imported in 1950-51 shall be the value of such imports for 1952-53. In addition, of course, there are the cases of people who have lodged their own orders for books. I believe that I am right in saying that they have been placed in the administrative section of the licensing system. I really believe that that is proper treatment of this problem. I can only wish that it were not necessary to place, any restrictions at all on books, but we are not our own masters in this matter. Nothing would be worse than to allow our sympathetic judgment to sway us to allow goods to be imported in terms of quantity for which we could not pay at the end of the financial year.

page 15

QUESTION

CIVIL AVIATION

Mr TURNBULL:
MALLEE, VICTORIA

– Will the Minister for Civil Aviation state whether it is a fact that the Government is importing six turbo-jet aeroplanes for Trans-Australia Airlines at a cost of approximately £2,000,000 each ? If so, can the Minister justify this expenditure on imported goods when machinery for primary production is so urgently required?

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

– The honorable member is completely wrong in what he believes to be the facts.

Mr Turnbull:

– I asked whether the statements were facts.

Mr ANTHONY:

– No, they are completely wrong. In the first place the Government is importing nothing for Trans-Australia Airlines which is a statutory body and has its own funds with which, to purchase aircraft and other equipment. Those funds are derived from depreciation, the writing down of existing aircraft, and the reserves that are kept for the purpose of buying new aeroplanes. Secondly, the cost of the turbo-jet Vickers Viscount aircraft is not £2,000.000 each, but, I believe, £200,000 each. Arrangements for the ordering of these aircraft were entered into some considerable time before the recent import restrictions were imposed.

page 15

QUESTION

HEALTH AND MEDICAL SERVICES

Mr THOMPSON:
PORT ADELAIDE, SOUTH AUSTRALIA

– Has the Minister for Health considered the anomaly that exists in that persons in receipt of age and invalid pensions are able to obtain medical treatment under the Government’s health scheme, whereas those who require physiotherapy treatment are unable to obtain it unless the physiotherapist, concerned is prepared to work without fee or reward ? If the right honorable gentleman has not yet considered making the services of registered physiotherapists available to age and invalid pensioners in the same way as the services of medical practitioners are available to them, will he consider doing so ?

Sir EARLE PAGE:
CP

– It has been a great task for my department to get the health service for age and invalid pensioners to its present state of efficiency. Last year the number of medical attendances in connexion with the scheme totalled not less than 2,000,000. Up to the present it has been impossible for us to extend the scheme. The suggestion made by the honorable member will be examined and I shall ascertain whether it is practicable to provide such services.

page 15

QUESTION

SUPERANNUATION

Mr CRAMER:
BENNELONG, NEW SOUTH WALES

– I remind the Treasurer that during the war reductions were made in the superannuation payments of retired Commonwealth officers who were re-employed by the Commonwealth during that period and that last year a provision was inserted in the Superannuation Act which enabled the amounts so deducted to be refunded. As such refunds have not yet been made, will the Treasurer look into the matter and ascertain whether early payments can be made as the withholding of the money is causing difficulty to many of the former officers concerned?

Sir ARTHUR FADDEN:
CP

– I shall certainly look into the matter with a view to having the payment of the refunds expedited.

page 16

POSTAL DEPARTMENT

Mr FULLER:
HUME, NEW SOUTH WALES

– 1 have received from constituents throughout my electorate, particularly from primary producers, many letters expressing strong resentment at the Government’s policy of drastically curtailing mail services. In some instances these services have been reduced from a daily delivery to deliveries only three times a week. In other instances deliveries have been cut from three days -i week to twice a week.

Mr SPEAKER:

– Order ! The honorable member is giving rather than seeking information.

Mr FULLER:

– In view of the growing discontent among country people because of this policy, and further, in view of the Government’s plea to primary proi lucern to increase production, will the Postmaster-‘General have the policy reviewed and restore to country districts the mail services which in some instances they have enjoyed for the last 50 years?

Mr ANTHONY:
CP

– I have heard a good deal of talk about country mail services having been drastically curtailed.

Mr Fuller:

– The Minister now has in his office a letter from me on the subject.

Mr ANTHONY:

– Only about a half a dozen mail services have in fact been curtailed. As thousands of mail services are provided by the Postmaster-General’s Department I do not think that such a curtailment can be regarded as drastic. The department is calling for the usual tenders for mail services and also for alternative quotes for services of a lesser frequency. It does not follow that services of a lesser frequency will be provided. Tenders are being called in order to ensure more competition. Necessarily, there will have to be some curtailment of mail services in districts where a change of population has reduced the volume of business. In general, up to date, there has been no substantial interference with mail services. Such interference as has taken place is scarcely worth mentioning.

page 16

QUESTION

HIDES

Mr ADERMANN:
FISHER, QUEENSLAND

– Will the Minister for Commerce and Agriculture state whether the Commonwealth is in any way involved in the present set-up under which hides and tallow are expected to be sold at ridiculously low and unpayable prices? Why are leather prices prohibitive when the price of hides often fails to meet the cost of transport? If the Commonwealth is in any way involved in this matter, will the Minister take appropriate action to ensure that, a sufficient supply of hides will be forthcoming to the market ?

Mr McEWEN:
MURRAY, VICTORIA · CP

– The Commonwealth is involved in this matter, but not in respect of the local price for hides. The State prices authorities have maintained that price unaltered at the 1939 level. This is the only commodity in Australia in respect of which price adjustments have not been made. The price of hides for local use is only a few pence per lb., whereas the price of hides for export is many times the local price. Accordingly it has become necessary, first, to ensure the retention in Australia of adequate supplies of hides for our own purposes, even if they have to be sold at the low prices that prevail at present; and, secondly, to equalize the price of hides at the average of the local and export prices. To that end an officer of the Department of Commerce and Agriculture has been appointed as chairman of the Australian Hide and Leather Industries Board, which operates a mechanism rather too involved to describe in answer to a question. The Board decides what quantity of hides and leather should be retained in Australia, or, conversely, what quantity should be permitted to be exported under permit, and what shall be the equalized price. On several occasions I have suggested to the State prices authorities that the local price of hides is unreasonably low and that it should be adjusted, but the States have taken no action. Although the State prices authorities have no inhibitions about increasing the prices of footwear, handbags and other leather goods, the local price of hides still remains at the 1939 level. Apparently only the primary producers are being penalized.

page 17

QUESTION

EMPLOYMENT

Mr HAYLEN:
PARKES, NEW SOUTH WALES

– Will the Minister for Labour and National Service state why his department continues to issue optimistic estimates of employment in Australia when members of Parliament know that the figures are not accurate in relation to actual experience? Is it a fact that the statistics so issued are eight weeks out of date and that the categories mentioned as being acceptable for employment are so boggled together that there is no way of ascertaining whether work is available for the people in the constituencies? Further, when issuing such statements in the future will the Minister indicate alongside the number of jobs available the number of people who have been refused jobs because they are not available at local omployment agencies ?

Mr HOLT:
LP

– I am not aware that there is anything optimistic in comment accompanying the statistics issued by the department to which the honorable member has referred. It has been our practice for some years - I believe it was in full force during the time of Labour Administration - to issue monthly statements of jobs available which are primarily intended for the information of institutions and organizations which take an interest in these matters. It was never intended in those statements to give an official expression of Government policy regarding the employment level at a particular time. 1 should agree that if the statements were read in the sense that the honorable member has implied they could prove to be misleading. However, for the reason I have indicated, if they give a list of vacancies that does not mean that a position is immediately open for a number of particular persons because it might require a balance between skilled and unskilled persons. We set out the factual position that the figures disclose. We give the number of vacancies recorded with the department and the number of persons who have applied for and obtained employment benefit; but, usually, we endeavour to give some general comments to indicate our general view of the trend. I have said that there has been, a tightening of the labour situation and a marked decline of the number of vacancies recorded, but, at the same time, the level of unemployment, so far as L can discover, is lower in Australia than it is in any other industrialized country at present.

page 17

THE PARLIAMENT

Mr SPEAKER:

-(Hon. Archie Cameron). - Honorable members will recall that on the 4th March last discussion took place in this chamber with respect to a ruling that I gave relating to the withdrawal of unparliamentary language and offensive behaviour. On that occasion, in reply to the Minister for Supply (Mr. Beale), the honorable member for Evans (Mr. Osborne) and the Leader of the Opposition (Dr. Evatt), I promised that I would prepare a considered ruling on the subject. I am now preparing that ruling and shall deliver it to-morrow. I shall supply copies of it to the leaders of all parties so that they may attend tomorrow with their notices of dissent already drawn up.

page 17

SUSPENSION OF STANDING ORDERS

Motion (by Mr. Eric J. Harbison) - by leave - agreed to -

That so much of the Standing Orders be suspended as would prevent the introduction, and motions for the first and second readings, of the following bills: - Land Tax Assessment, Land Tax, High Commissioner, Spirits, Whaling Industry, Australian War Memorial, States Grants (War Service Land Settlement), Northern Territory Acceptance. Naval Defence, and Air Force.

page 17

LAND TAX ASSESSMENT BILL 1952

Motion (by Sir ARTHUR Fadden) agreed to -

That leave be given to bring in a bill for an act to amend the Land Tax Assessment Act 1910-1951.

Bill presented, and read a first time.

Second Reading

Sir ARTHUR FADDEN:
MCPHERSON, QUEENSLAND · CP

– I move -

That the bill be now read a second time.

Under the provisions of the Land Tax Assessment Act a statutory deduction of £5,000 is allowed in the case of a resident land-owner in arriving at the taxable value of his land on which the tax is imposed. This amount has remained unchanged since the enactment of the act in 1910. In the measure now before the House, it is proposed to increase the statutory deduction from £5,000 to £8,750. As one of the measures for controlling war-time inflation, sales of land were, during the war and post-war years, strictly controlled. As a consequence of this control and in view of the man-power difficulties in making valuations during those years, unimproved values of land to be applied in land tax assessments were, in March, 1942, by regulation under the National Security Act, pegged to the unimproved value of the land as assessed at the 30th June, 1939. After the repeal of the National Security Act as from the 31st December, 1946, the pegging of values was continued under the annual Defence (Transitional Provisions) Acts and the pegged values continued to apply in assessments for the financial years up to and including the financial year 1950-51.

As land sales control had, during the year ended the 30th June, 1951, ceased to apply, and as there was then a free market for sales of land, the Government decided that the pegging of values for land tax purposes should be removed and that assessments for the financial year 1951-52 and subsequent years should be based on the market value of the. land at the appropriate 30th June.

Land tax assessments for the current financial year are based on the unimproved value of the land at the 30th June, 1951, and, in view of the removal of pegging, are based on values substantially higher than the values which have been applied in land tax assessments since the financial year 1939-40. The overall average increase in values has been estimated at approximately 75 per cent., but in individual cases the increase may be much greater. The effect of the increased values on the liability of land taxpayers is illustrated by the fact that whilst the revenue for 1950-51 from the tax was approximately £3,500,000, the budget estimate of the revenue to be obtained for the current financial year was £7,500,000. Whilst the Government does not consider that the statutory deduction should be varied, from time to time, in accordance with the variations in the level of the unimproved values of land, it considers that, in the special circumstances which exist, there should be some alleviation of the greatly increased liability which the increased values impose on land taxpayers.

As one of the steps towards this end it is proposed to raise the statutory deduction from £5.000 to £8,750, an increase of 75 per cent., which corresponds with the overall increase in values. This is being clone by an appropriate amendment to section . 11 of the principal act. The amendment of section 11 for this purpose involves consequential amendments of section 38 (7) and section 38a, which make provision for the allowance of the statutory deduction in cases of taxpayers holding interests in joint ownerships under wills or settlements operative prior to the commencement of the act in 1910.

It is estimated that the increase in the unimproved values of land has brought into the field about 22,000 new taxpayers who previously had never been required to lodge returns. The effect of the proposed increase in the statutory deduction will be that these persons will now be excluded from the operation of the act. It is also estimated that the increase of the statutory deduction will offset by £687,000 the additional revenue to be obtained from the tax during this year.

In addition to increasing the statutory deduction the Government has decided to remove the super tax of 20 per cent. which is imposed in cases where the taxable value of the land exceeds £20,000. This decision is the subject of a separate measure amending the Land Tax Act. I commend the bill to honorable members.

Debate (on motion by Mr. Calwell) adjourned.

page 19

LAND TAX BILL 1952

Motion (by Sir ARTHUR Fadden) agreed to -

That leave be given to bring in a bill for an act to amend the Land Tax Act 1010-1941.

Bill presented, and read a first time.

Second Reading

Sir ARTHUR FADDEN:
.Treasurer · McPherson · CP

– I move -

That the bill be now read a second time.

The purpose of the bill is, first, to abolish the super tax of 20 per cent, which is imposed in the assessments of land taxpayers, the taxable value of whose land exceeds £20,000 and, secondly, to ensure that the flat rate of Id. in the £1 which is paid by absentees on the first £5,000 of taxable value will be extended to £8,750 to conform with the proposed increase in the statutory deduction which is allowed to resident land-owners.

The super tax was imposed in 1941 as a war-time measure and is an additional amount equal to 20 per cent, of the tax otherwise payable or 1 per cent, of the taxable value of the land in excess of £20,000, whichever is the less. As a consequence of the substantial increase in the unimproved values applied in land tax assessments for the current financial year compared with the pegged values which have been applied in assessments for the past twelve years, it is estimated that land taxpayers will be called upon to pay this year about £4,000,000 additional tax to that paid in the previous year. As the super tax was imposed to assist in financing the war, the Government has decided, as a step towards alleviating the greatly increased liability which the increase of unimproved values has imposed on land taxpayers, that this additional impost should be abolished. Absentees do not receive any statutory deduction ; they pay tax on the full unimproved value of their land. On the other hand, residents receive a deduction of £5,000 and pay tax only on the unimproved value of their land in excess of £5,000.

Under the existing law, absentees pay a flat rate of Id. in the £1 on the first £5,000 of unimproved value of their land. As I previously explained, the first £5,000 of the unimproved value in the case of a resident is, by the operation of the statutory deduction, exempt from tax. The taxable value of the land in the case of an absentee is thus the full unimproved value, whereas, in the case of a resident, it is the unimproved value less £5,000. Where the taxable value of the land owned by an absentee exceeds £5,000, the rate of tax on £5,001 is 2d. plus one eighteen thousand, seven hundred and fiftieth of a penny, increasing uniformly by one eighteen thousand, seven hundred and fiftieth of a penny for each additional £1 of taxable value until the taxable value reaches £80,000, at which point the rate reaches 6d. in the £1. Thereafter the rate of tax is lOd. in the £1. Throughout the scale the rate of tax payable by absentees i3 Id. greater than the rate payable by residents.

The bill to amend the Land Tax Assessment Act which I have just introduced will increase the statutory deduction allowed to residents from £5,000 to £8,750. This increase involves a consequential amendment to the schedule imposing the rates of tax payable by absentees in order to maintain the application of the flat rate of Id. in the £1 on the taxable value of the land up to £8,750 instead of £5,000 as at present.

The schedule lias, accordingly, been recast for this purpose. Where the taxable value of the land exceeds £8,750, the rate will increase in exactly the same ratio as it does at present, reaching 6d. in the £1 at £83,750 as against £80,000 under the existing scale. Under the amended scale, the absentee’s rate of tax will, throughout the scale, continue to be Id. in the £1 greater than that of a resident as it is at present. It is estimated that the abolition of the super tax will offset the additional revenue to be obtained from the tax during this year by £1,020,000. The effect of the variation of the tax payable bv absentees will be negligible. I commend the bill to honorable members.

Debate (on motion by Mr. Calwell) adjourned.

page 20

HIGH COMMISSIONER BILL 1952

Motion (by Mr. Eric J. Harrison) agreed to -

That leave be given to bring in a bill for an act to amend the High Commissioner Act 1909-1945.

Bill presented, and read a first time.

Second Reading

Mr ERIC J HARRISON:
Vice-President of the Executive Council and Minister for Defence Production · WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– I moye -

That the bill be now read a second time.

This is a bill to amend section 6 of the High Commissioner Act in order to permit of an increase of the salary of the High Commissioner for Australia in the United Kingdom from £3,000 to £3,500. When the High Commissioner Act was enacted in 1909, it provided that the salary of the High Commissioner should be £3,000, and so, down the years, the salary has remained at that figure. There has never been any attempt to relate the High Commissioner’s salary to changing circumstances and conditions. The rate of salary has remained static during all kinds of economic crises and vicissitudes and to-day, after more than 40 years, we find the statute still providing for a salary of £3,000. I need hardly draw honorable members? attention to a comparison between the value of a salary of £3,000 in 1909 and that of the same salary nowadays. The comparison is ludicrous. Fluctuations of the basic wage, of the cost of living and of the average wage paid from time to time are so well-known that a mention of them will suffice. The salaries of heads of departments and departmental officers have increased beyond recognition over the last 40 years. The High Commissioner is our representative in the United Kingdom and holds one of the major diplomatic posts abroad. His office is a very onerous and exacting one. The difficulties of the war years and of the hardly less troublous period that has followed the war have added burdens to the already heavy load the High Commissioner has been carrying. The work that he is doing for Australia in the United Kingdom, in carrying out the important and delicate duties which have to be undertaken and in smoothing out difficulties which must necessarily arise, is invaluable. It is therefore fitting that some measure of recompense should be embodied in the statute. This bill aims to do this by increasing the salary to £3,500 to take effect from the 21st June, 1951. I recommend the bill to honorable members.

Debate (on motion by Mr. Tom Burke) adjourned.

page 20

SPIRITS BILL 1952

Motion (,by Mr. Eric J. HARRISON. agreed to -

That leave be given to bring in a bill for an act to amend the Spirits Act 1900-1947.

Bill presented, and read a first time.

Second Reading

Mr ERIC J HARRISON:
Vice-President of the Executive Council and Minister for Defence Production · WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

.- I move-

That the bill be now read a second time.

This is a bill to amend the Spirits Act. Clauses 1 and 2 are drafting measures. By clause 3, it is proposed to include in the Spirits Act the terms under which words signifying long maturation may be used to describe potable spirits. The qualification will be according to the time the spirits have actually been stored in wood. Regulations in force under the Customs Act contain a comparable provision insofar as imported bulk spirits which are bottled in bond in the Commonwealth are concerned, but no provision of a like character exists to cover spirits imported in the bottle. Regulations under the Excise Act take care of the wording used to describe Australian spirits bottled in bond. The proposal now put forward will facilitate the application of identical conditions to all spirits, imported or domestic, in regard to the use of the words “old “ or “ very old”.

In clause 4, a proposal is put forward to add other kinds of spirits, or distilled spirituous liquors, such as arak, aquavit and vodka, to those already exempted by the act from the maturation provisions of sections 11 and 12. It is not a practice to store in wood spirits which have undergone a high degree of rectification in course of distillation, such as gin, schnapps and liqueurs, as it is very doubtful whether they are thereby improved. However, it has long been recognized that proper maturation effects appreciable improvement of the quality of spirits, such as brandy, whisky and rum, which are distilled at lower strengths.

Debate (on motion by Mr. Tom BURKE) adjourned.

page 21

WHALING INDUSTRY BILL 1952

Motion (by Mr. McEwen ) agreed to -

That leave be given to bring in a bill for an act to amend the Whaling Industry Act 1949.

Bill presented, and read a first time.

Second Reading

Mr McEWEN:
Minister for Commerce and Agriculture · Murray · CP

, - I move -

That the bill bc now read a .second time.

The purpose of this bill is to amend section 29 of the principal act, the Whaling Industry Act 1949, in order to provide for a financial year commencing on the 1st April and ending on the 31st March. The present financial year of the Australian Whaling Commission extends from the 1st July to the 30th June and thus ends during the active whaling season, which for baleen whales commences on the 1st May and extends to the 31st October.

The Acting Auditor-General, in his report on the accounts of the Australian Whaling Commission for 1950-51, pointed out that the prescribed financial year was inappropriate and suggested that, if the financial year were altered to commence on the 1st April, the trading results of each complete season’s operations would be reflected in the accounts for the period. This would also be of assistance in administration by avoiding the necessity for preparing annual accounts during the height of the season. Further, as trading stocks would be at a minimum on the 31st March of each year, the commission could mare easily cope with the stocktaking of plant and stores during the off season. The Government is in agreement with the Acting

Auditor-General and I commend the bill to the consideration of honorable members.

Debate (on motion by Mr. HAYLEN adjourned.

page 21

AUSTRALIAN WAR MEMORIAL BILL 1952

Motion (by Mr. Kent Hughes) agreed to -

That leave be given to bring in a bill for an act to amend the Australian War Memorial Act 1925.

Bill presented, and read a first time.

Second Reading

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– I move -

That the bill be now read a second time.

This bill is designed to amend the Australian War Memorial Act 1925. Its main purpose is to make the Australian War Memorial - which is, I think, considered by every person who has seen it to be one of the finest war memorials in the world - a memorial not only to the Australian servicemen who gave their lives in the 1914-18 war, as it is under the present act, but also to those Australian servicemen who were killed in the 1939-45 war and all other Australians who have given their lives on active service. In the present act, “ the War “ is defined as meaning the war that commenced on the 4th August, 1914. Clause 2 of the hill proposes the omission of the definition of “the War” from the principal act, and the insertion of a definition of “ active service “. Those amendments, together with others that will be effected by clause 3 and clause 7, will extend the scope of the memorial to provide for it to be a memorial of the part taken by Australian forces in all wars, including the New South Wales Contingent of 1885, the Commonwealth Contingent to the Boxer Rebellion in 1900, and the Australian forces which served in the South African war. In that way, the memorial at Canberra will provide a complete record of the Australian naval, military and air forces from their inception.

Clause 4 proposes the repeal of sections 5 and 6 of the principal act and the insertion in their stead of two new sections. Those sections relate to the constitution of the Board of Management of the memorial. Under the present provisions, the board is constituted entirely nf members appointed by the GovernorGeneral in Council. As a result, certain members, particularly the Chief of the Naval Staff, the Chief of the General Staff and the Chief of the Air Staff, although they are really ex officio members of the board, having been appointed by virtue of the positions that they hold, have to be. asked, whenever they relinquish those positions, to resign from the board of management in order that their successors may be appointed in their places. Proposed new section 5 will give authority for the Chief of the Naval Staff, the Chief of the General Staff and the Chief of the Air Staff to be members of the board. Whenever the bolder of one of those positions relinquishes his post, he will automatically cease to be a member of the board and his successor will automatically become a member in his place. All other members will be appointed by the Governor-General in Council.

Proposed new section 6 will empower the members of the board to elect one of their number to be the chairman of the board. At present, the chairman is appointed by the Governor-General. Under the existing act, the chairman of the board has only a deliberative vote at board meetings. Clause 5 proposes the insertion of a new sub-section, under which the chairman in the event of an equality of votes, will be entitled also to a casting vote. ‘Clause 6 will effect a machinery amendment by restricting the operation of section 8 of the principal act, which deals with the vacation of office of members appointed by the Governor-General, only to those nine members who are appointed by the Governor-General and are not ex officio members of the board.

Clause 8 proposes the insertion of new sections 14a and 14b. They are selfexplanatory. Proposed new section 14a deals with the perusal of records. It reads as follows: -

Where the Board, or a person authorized by the Board to act under this sub-section, is satisfied that it is necessary or desirable !<o to do,- the Board or that person may authorize a person to peruse and make extracts from, or copies of, any of the records or documents forming part of the war relics of the Commonwealth which are not on public exhibition.

Proposed new section 14b prohibits the manufacture, printing, publishing and sale of exhibits unless permission has been given in writing by the board or by a person authorized by the board to give such permission. Those two proposed new sections have been found necessary as a result of experience. I commend the bill to the House.

Debate (on motion by Mr. Haylen) adjourned.

page 22

STATES GRANTS (WAR SERVICE LAND SETTLEMENT) BILL 1952

Motion (by Mr. Kent Hughes) agreed to -

That leave be given to bring in a bill for an act relating to grants to the States in connexion with war service land settlement.

Bill presented, and read a first time.

Second Reading

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– I move -

That the bill be now read a second time.

This is one of those delightful measures that appear upon the statute-book because the legal authorities have said, “It may not be entirely necessary, but we think it highly desirable that a measure of this nature should be passed”. Since 1949, when the High Court, in the Magennis case, declared the War Service Land Settlement Agreements Act to be ultra vires the Constitution, we have been carrying on the administration of war service land settlement under the provisions of section 96 of the Constitution. The War Service Land Settlement Agreements Act was a very short measure, which put into legislative form the agreements that had been arrived at between the States and the Commonwealth in respect of war service land settlement. In 1949 the High Court ruled that that act was invalid because it related to acquisition and did not affirmatively provide for just terms of acquisition. Therefore, the agreements and the act went by the board. Then it was decided to carry on more or less under the terms of the agreements, except for the question of the disagreement in certain quarters upon the matter of just compensation. That method of operation has been used since the High Court judgment was delivered in 1949.

On the 24th May, 1950, there was a meeting at Canberra, between the Commonwealth Minister for the Interior and the Ministers of the Governments of New South Wales, Victoria and Queensland who were administering the war service land settlement scheme in their respective States. The meeting was called to discuss a new agreement between the Commonwealth and those three States, as a result of the decision of the High Court. Only New South Wales, Victoria and Queensland were concerned because they are the three States acting as principles. The other States are agent States. At that meeting, it was agreed that the whole question of carrying on the war service land settlement scheme should be referred to legal advisers. The advice of the legal advisers was that the Commonwealth Parliament should enact a short measure in pursuance of section 96 of the Constitution, providing for the grant of financial assistance to the States in connexion with war service land settlement subject to the condition that settlement was effected in a manner acceptable to the Commonwealth Minister for the Interior.

The wording of this bill may appear to be somewhat dictatorial. The measure provides that the sums payable to the States shall be paid in such amounts and subject to such conditions as the Minister for the Interior shall determine. That means, in effect, “ as determined by the Cabinet “ which phrase itself means, “ as approved by the Parliament “. So, although the wording of the bill may appear strange, it merely constitutes a legal method of saying, “ as determined by the Cabinet and the Parliament “. That is the process which has been carried on since the High Court decision was given in 1949. This bill seeks merely to give effect to the unanimous recommendation of the legal advisers of the three State? concerned, and puts into legal form something that the legal authorities at the moment seem to consider is not necessary but is advisable to have in such form.

Debate (on motion by Mr. ALLAN Fraser) adjourned.

page 23

QUESTION

NORTHERN TERRITORY ACCEPTANCE RILL 1952

Motion (by Mr. Hasluck) agreed to -

That leave bo given to bring in a bill lor an act to amend the Northern Territory Acceptance Act l’.UO-lOH), as amended 1, v the Northern Australia Act 1920.

Bill presented, and read a first time.

Second READING

Mr HASLUCK:
Minister for Territories · Curtin · LP

[4.56J. - I move -

That the bill hu now read a second time.

This short bill is designed to correct a certain disparity in land-holding in the Northern Territory. When the Northern Territory was transferred from South Australia to the Commonwealth of Australia 42 years ago, it was provided in section 10 of the Northern Territory Acceptance Act that all estates and interests held within the Northern Territory, at the time of the acceptance, by any person from the State of South Australia, should continue to be held from the Commonwealth on the same terms and conditions as they were held from the State. Subsequently the Commonwealth also created rights in land, and to-day the vast majority of land-holdings in the Northern Teritory are under some form of leasehold granted by the Commonwealth. There are, however, about 2,000 titles in fee simple, originally granted by South Australia, mostly in the Darwin and gulf districts, comprising altogether an area of approximately 675 square miles.

The operative clause of the bill proposes to amend section 10 of the Northern Territory Acceptance Act by inserting words that will place beyond doubt that the lands held under these old titles, like the lands subsequently alienated, shall be held subject to the laws of the territory.

Section 10 of the principal act will be amended to read as follows: -

All estates and interests held by any person from the State of South Australia within the Northern Territory at the time of the acceptance shall, subject to Ordinances in force under the Northern Territory (Administration) Act 1910-1949, continue to be held from the Commonwealth on the same terms and conditions as they were held from the State.

There is no reason to suppose that when section 10 was originally framed 42 years ago it was intended to do anything else than provide for the conversion from State tenure to Commonwealth tenure of the estates and interests to which the section refers. It could not be envisaged that the intention was to give to these title-holders special immunity from the operation of any laws which, in the public interest, it would be necessary to enact from time to time in the territory. It cai; hardly have been intended to create mie class of land-holders subject to territory laws and another class of landholder? who were not subject to them.

The outstanding example of the disparity between the two classes of land-holders may be found in relation to mineral rights. One peculiarity of the titles in fee simple issued by South Australia in the 1870’s was that the ownership of minerals went with the title, whereas modern practice in land distribution in Australia, as applied in the land legislation of the Commonwealth a.nd the States, is to reserve mineral rights to the Crown. Although these old titles included ownership of minerals, subsequent South Australian legislation, passed before the days of the transfer, provided for mining on the land by persons other than the owner upon certain conditions. However, the application of territory legislation to the lands held under the old titles in respect of prospecting and mining is not wholly clear. This situation is regarded as not being in the best public interest nor in conformity with the modern practice as expressed in the Northern Territory M ining Ordinance and in all State mining laws to-day. It is therefore proposed to provide means to correct it by this bill. ATe are not making any novel or surprising proposal. If no transfer had taken place in 1910, and the lands for which titles were originally issued in South Aus- tralia had remained in South Australia, they would to-day be subject to State laws which would have affected the mineral rights. As it is the aim of the Government to encourage prospecting and mining in the Northern Territory it is important to clarify the situation. If the bill is passed it is intended to bring down an ordinance in the Northern Territory Legislative Council that will acquire for the Crown all the rights in the minerals on freehold land in the Territory, and provide for compensation to be made to the present title holders. This will make all landholding in the Territory uniform in respect of mineral rights.

This reference to mineral rights illustrates the purposes and the expected effect of the passing of the bill. It is a short and simple measure to make in the most direct way possible an improvement that has been found necessary in land administration in the Northern Territory. I commend it to the House on the grounds that it is in the public interest, that it will facilitate the development of the resources of the Northern Territory and that it deals with the rights of the land-holder in a fair and reasonable way.

Debate (on motion by Mr. Nelson) adjourned.

page 24

NAVAL DEFENCE BILL 1952

Motion (by Mr. McMahon) agreed to-

That leave be given to bring in a bill for an act to amend the Naval Defence Act 1910-1949.

Bill presented, and read a first time.

Second Reading

Mr McMAHON:
Minister for the Navy and Minister for Air · Lowe · LP

– I move -

That the bill be now read a second time.

This bill is necessary to bring the Naval Defence Act into conformity with the National Service Act and the Defence Act. It also seeks authority to raise a native force for naval service and it provides authority for the constitution of the Naval Reserve Cadets and a Sea Cadet Corps. Parts of the Defence Act, which relate to compulsory service, are repealed, and provision is made to permit National

Service Trainees, who volunteer for service outside Australia, to serve in the Royal Australian Navy.

Under Part V. of the bill, provision is made for the training and conditions of service of Naval Reserve. Cadets and the Australian Sea Cadet Corps to be prescribed by regulations. The Naval Reserve Cadets are enrolled between the ages of sixteen and eighteen years. The Navy League of Australia has established a Sea Cadet Corps. Boys between fourteen and eighteen years of age are accepted, the policy being generally to restrict the entry to boys between fourteen and sixteen years of age in those areas where naval reserve training establishments are located. A very considerable proportion of those eligible to do so join either the Permanent Naval Forces or the Royal Australian Naval Reserve.

Proposed new section 24a confers authority to raise for naval service a native force consisting mainly of aboriginal inhabitants of a territory of the Commonwealth. It provides that service in a native force shall comply with the Charter of the United Nations. Similar authority to raise a native force for military service has been conferred by the Defence Act.

In proposed new section 44D provision is made to regulate the sale and supply of intoxicating liquor in naval canteens, camps, establishments and ships. The sale and supply of intoxicating liquor to National Service Trainees under 21 years of age is prohibited. Similar provisions have been made under the Defence Act in relation to trainees in the Army. I commend the bill to honorable members.

Debate (on motion by Mr. Pollard) adjourned.

page 25

AIR FORCE BILL 1952

Motion (by Mr. McMahon) agreed to-

That leave be given to bring in a bill for an act to amend the Air Force Act 1923-1950.

Bill presented, and read a first time.

Second Reading

Mr McMAHON:
Minister for the Navy and Minister for Air · Lowe · LP

– I move -

That the bill be now read a second time.

The Government’s policy for the introduction of national service was enunciated in the national service legislation which was passed by this House last year. This has necessitated amendments to the Air Force Act 1923-1950, which is a very short act providing for the establishment, organization and government of the Royal Australian Air Force. It provides for the application to the Air Force of certain sections of the Defence Act and the Imperial Air Force Act, and deals with the liability of members of the Air Force to serve outside Australia, and the power of the Governor-General to make regulations. It will be seen, therefore, that very little amendment is necessary consequential upon the passing of the national service legislation of 1951.

This bill proposes to eliminate references to Parts XII., XIII. and XIV. of the Defence Act - the old compulsory training provisions - to omit Part V. of the Defence Act relating to compulsory training by Junior and Senior Cadets, and to amend section 4 of the Air Force Act 1923-50 in order to bring it into conformity with the provisions of National Service Act 1951.

I commend the bill to the House.

Debate (on motion by Mr. Pollard) adjourned.

page 25

QUESTION

INTERNATIONAL AFFAIRS

Debate resumed from the 22nd February (vide page 274, Volume No. 216), on motion by Mr. Casey -

That the following paper be printed : -

International Affairs - Ministerial State ment, 22nd February, 1952.

Dr EVATT:
Leader of the Opposition · Barton

– The House considered the statement of the Minister for External Affairs (Mr. Casey) on international affairs some months ago and many of the matters that he mentioned related to events that were occurring then. However, I am obliged to the Minister for his statement concerning the decisions of the General Assembly of the United Nations organization at which Australia was represented. The Minister referred to the stormy nature of some of the debates in the General Assembly. As he must know such debates are nothing new.Plain, vigorous, aud sometimes violent, debate has become part and parcel of the proceedings of the General Assembly. Nevertheless, the importance of this body has become self-evident during the last few years. In a sense, the balance of power within the United Nations organization is gradually passing from the Security Council to the General Assembly. I remember very vividly that when the Charter of the United Nations organization was being drafted a number of nations, including Australia, objected most vigorously to the exercise of the veto by the five powers.

The exercise of the veto has not been limited to enforcement action such as that which is exemplified in Korea, but baf been extended to mediation between disputants by the Security Council. Such mediation cannot be undertaken by the Security Council if any one of the five powers object. It is notorious that ever since 194S Russia has exercised its right of veto almost continuously on matters which it considered affected its security. Fortunately, the United Nations Charter, which is often misunderstood, also contains provision for the holding of wide discussions and the making of recommendations to the General Assembly. For instance, when the dispute occurred over the Balkans the matter first came to the Security Council and investigation committees were set up in order to try to prevent interference with the Greek nation by its neighbours in the north - Yugoslavia, Albania and Bulgaria. Later on, being uneasy over some of the results, the Russian Government exercised a veto which would have resulted in terminating the activities of the investigation committee. However, through the General Assembly, a commission was appointed for the purpose of performing almost the same functions as those which had been performed previously by the investigation committee. That incident illustrates the type of work that the General Assembly is able to do. The transfer of power and influence to the General Assembly where no power of veto exists has increased the democratic strength of the United Nations organization.

The General Assembly is sometimes criticized, due to the fact that 60 nations are represented there and, as I have said, the debates sometimes take a very vigorous and even violent form. That need not give cause for concern. The decisions that this body is competent to make are carried into effect. During the last session of this Parliament, the Minister cited some of the decisions which the General Assembly made at its last meeting, but he did not state all of them. I do not expect them all to be embodied in Hansard, but I should like the House to he informed of all the decisions made by the Plenary Assembly so that honorable members may know how Australia voted on each occasion.

In connexion with the Korean situation a very important point has been overlooked. There is no nation except the United States of America, and perhaps South Korea, which has rendered greater service in the Korean campaign than the British Commonwealth, especially the United Kingdom and. Australia. It is vitally important that our representatives should not be merely informed of what is taking place at the cease fire discussions but that they should participate in them. There should be active participation by the British Commonwealth at the military and political levels. I ask the Minister for External Affairs (Mr. Casey) to make, during the present sessional period, a further analysis of the international position, both for the benefit of honorable members and in order to bring his previous statement up to date.

Mr CASEY:
Minister for External Affairs · La Trobe · LP

– in reply - I listened with great interest to the Leader of the Opposition (Dr. Evatt). As he said, this matter was dealt with in the report to the House that I made towards the end of last February. During the present sessional period of the Parliament I propose to make a statement that will touch upon the principal aspects of foreign affairs as they affect Australia. T hope to do that within the next two or three weeks.

I shall now briefly reply to some of the questions raised by the Leader of the Opposition. He mentioned the United Nations Assembly, and the gradual but noticeable shift in the centre of gravity from the Security Council to the General Assembly. That is quite true, and it has been caused, as the right honorable gentleman said, by the constant use of the veto which has made democratic decisions by the Security Council practically impossible. I agree with the Leader of the < Opposition that that movement has tended further to democratize the proceedings of this great international forum, the United Nations. The right honorable gentleman used language of conscious moderation when he spoke of the vigour of the debates in the United Nations General Assembly. I should have chosen a rather more vigorous word than “ vigour “. With regard to the decisions of the plenary assembly, I shall most certainly comply with the right honorable gentleman’s request and have the decisions incorporated in Ilansard as soon as possible.

I understand that the Leader of the Opposition believes that Australia should have a representative on the negotiating body at Panmunjon. I see the point of that request but I doubt whether, at this advanced stage of the negotiations with the Communists, any change such as that suggested could be made. At present the United States is responsible for the negotiations insofar as the United Nations’ affairs are concerned. We know of the dreary and unsatisfactory nature of the negotiations that have been in progress for about nine months, and which never appear to move noticeably forward. Nevertheless we must continue to plug on. I remind the right honorable gentleman that Australia, takes full advantage of its opportunity for expressing its views on the policy to be adopted by the United Nations negotiator. Not a day goes by during which we do not express ourselves, in some cases with some strength, as to the policy being adopted bv the chief United Nations negotiator. We do that through Washington, and our ambassador in Washington has almost daily conferences about our proposals with senior officers of the American State Department. Several Australian proposals made in conjunction with our other colleagues during the last couple of months have been adopted. Therefore. I believe that it may be said that we are exercising to the fullest any opportunities that we have for influencing these vital external affairs. Our representatives are always welcomed at Washington. We have also had one of our senior departmental officers in Korea for a considerable time. He is on terms of the closest intimacy with the leading personalities among our Allies in Korea. His presence in Korea has proved of tremendous value to us.

I shall now extend somewhat the remarks that I made last February about. South-East Asia. If one compares our present state of knowledge of SouthEast Asia and our present degree of intense interest in the area, with the position only a relatively short time ago, one will perceive that both my department and myself are now giving vastly greater attention to South-East Asian affairs than has ever been the case before. We have become very much more aware than at any previous time in Australia’s history of the importance of South-East Asia to us, and of the obligation which lies upon Australia, and possibly upon all other self-governing Commonwealth countries, to concern themselves with that area. South-East Asia is now of greater concern to Australia than it is to any other power. In fact it is almost a metropolitan problem to us, whereas to other powers it is a rather distant problem. Therefore, we should have a continuing knowledge of events and trends in South-East Asia. We are at present setting up a legation at Saigon, which will make contacts with the governments of Veitnam, Laos and Cambodia, and we shall shortly set up a legation in Rangoon to make diplomatic contact with Burma. That will complete our chain of diplomatic representation at all posts in South and South-East Asia. Before long I hope to strengthen our diplomatic post at Singapore and use it as a regional reporting centre for all our posts in the whole of Asia. Mr. Malcolm McDonald, the Commissioner-General of South-East Asia for the United Kingdom, is situated at Singapore, where he has a considerable staff, and is regarded as a regional reporting centre for British posts in SouthEast Asia. By establishing an Australian diplomatic post in Singapore, similar to the British post there, we shall have the advantage of the closest liaison with Mr. Malcolm McDonald and shall have the advantage of advice from the United Kingdom posts as well as from our own.

In a few weeks time I shall make a fairly comprehensive statement on some of the matters that I have mentioned, and on other matters of world concern to Australia. Therefore, I shall say no more at present except to remind the House that the Joint Parliamentary Standing Committee on Foreign Affairs has been set up under the chairmanship of the honorable member for Flinders (Mr. Ryan). At present it is composed of selected members from the Government parties. At the moment - and I hope for not very much more than the moment - the Opposition has not seen fit to co-operate. Personally, I look forward very much to its early co-operation in the functioning of this committee, which is proving an extremely successful and useful body. If honorable members of the Opposition care to question the present members of the committee outside the House, I am sure that they will obtain confirmation of that statement.

Mr Morgan:

– When are they going to make a report?

Mr CASEY:

– It is not a question of reports, although I expect that the committee will report in due course. At the moment it is devoting fairly intense study to the individual countries of South-East Asia as well as to that area as a whole, it being our principal source of problems and closest to us geographically. The committee will then turn its attention to South Asia and will study the affairs of India, Pakistan and Nepal. After that, the countries of the general area of the Middle East will probably be studied, followed by the countries of the East, other than South-East Asia. Consideration will then be given to a number of instrumentalities of international concern.

My department has put forward a great deal of effort in order to produce documents to meet the requirements of the committee. It will, of course, continue to do so. A senior officer of the department is devoting practically his entire time to the work of the committee. He attends its meetings and supervises the preparation of the necessary documents. I myself have addressed the committee, b y their courtesy, on at least three occasions. I repeat that this committee will perform a most useful function by widening the range of knowledge of a representative group of parliamentarians of both Houses concerning the principal matters related to international affairs. I again invite the Leader of the Opposition (Dr. Evatt) to reconsider the decision of the Australian Labour party in order that the Parliament and also the country might benefit by the service of members of the Opposition on the committee.

Question resolved in the negative.

page 28

PUBLIC SERVICE

Debate resumed from the 2nd October, 1951 (vide page 207, Volume No. 214), on motion by Mr. Menzies -

That the following paper be printed: -

Public Service Retrenchments - Ministerial Statement

Mr DEAN:
Robertson

.- This subject was fully debated during a previous sessional period and it is necessary for only one or two matters to be mentioned at this stage. First, I think that honorable members should remember that the retrenchment of a certain number of public servants was a matter of Government policy. Reference to it was made in the policy speech of the Prime Minister (Mr. Menzies) during the general election campaign, and the fact that retrenchment has been carried out illustrates that the Government has honoured the promise that was then made. At that time it was stated that approximately 10,000 persons were to be retrenched. Actually, I understand that that number has been exceeded. It should be clearly understood that no attack upon civil servants is being launched by the Government. All honorable members on this side of the House, and I think the majority of those on the other side of the House, pay tribute to the services which most permanent public servants render to the country. Soon after the last world war ended a large number of temporary public servants was engaged by the government of the day. The present Government has found it possible to dispense with, the services of approximately 11,000 public servants, and there is no evidence that inefficiency has resulted. That is one of the most important aspects to consider when this matter is being discussed. The taxpayers of Australia have been relieved of a certain amount of their financial burden because of this action on the part of the Government.

Much confusion of thought has existed concerning this matter, although the majority of Australians agree with the action that has been taken. Many complaints have been made to members of this Parliament, letters have been written to the press, and generally, the whole electorate has been most vocal in the matter. At one stage reports were current that the Public Service was being increased by more than 100 persons a day. lt. was stated that one person in every three was employed in the civil service of the country.

Mr Calwell:

– Not in the Commonwealth Public Service !

Mr DEAN:

– No country could afford to carry such a large number of civil servants. It is appreciated, of course, that certain services to the community must be regarded as essential. Additions have to be made to the Public Service from time to time because of the requirements of constructional works for the national development of the country. It is well to remember that when the total number of public servants is being calculated, every person on the pay-roll of the Government should be taken into account. Therefore, it is necessary to include those, who are at present employed on the great national developmental work being carried on by the Snowy Mountains Authority. Every one appreciates the necessity for that work to proceed. The fact that the Public Service may be increased in size because of additions to the staff of the Authority does not constitute a negation of the policy of this Government that the strength of the Public Service overall should be reduced. There has been no denial of the statement that the retrenchments have been effected without loss of efficiency and without hardship being imposed on the community.

I believe that the object of the Chifley Government in increasing the Public Service to the degree that it did was to make more and more Australians dependent upon it. The idea was that if the Public Service was increased, the Government would have greater influence over a larger number. That is not a criticism of the Public Service as a service, but of the policy of the Chifley Government. I congratulate the Government on its actions and 1 believe that they are endorsed also by a big majority of the people.

Mr CALWELL:
Melbourne

.- The Opposition opposes the Government’s action in adopting a policy of retrenchment in the Public Service. The idea of retrenchment commends itself to some honorable members. The very fact that the Public Service exists at all causes sleepless nights for some of the more conservative honorable members in this ch amber and their supporters outside it. They believe in an era of free enterprise in which everybody will work for private employers and no one will be employed by the Government.

Mr TURNBULL:

– In which fewer will be employed by the Government.

Mr CALWELL:

– The honorable member for Mallee (Mr. Turnbull) could not restrain himself. He had to identify himself as the first of the reactionaries, lt would suit the honorable member to have nobody in the Public Service except those who are in the Post Office and deliver mails in his own electorate. Many honorable members forget that there are Liberal party socialists, Country party socialists and Labour party socialists all mixed up in this House. Our ideas on socialism differ in degree and variety, but everybody believes in a certain amount of socialism and the members of the Australian Country party are the greatest socialists of all when they want something for themselves and for those whom1 they represent. I do not blame them for that, but I do blame them for the inconsistency with which they approach the question that is before the House. The honorable member for Gippsland (Mr. Bowden) spoke strongly in favour of retrenchment, as though it were a good thing. But retrenchment is an ugly word. It connotes a depression in the offing. When people talk of retrenching, they mean that they are going to spend less. Once everybody spends less, suffering accumulates for quite a number of good people in the community. Many people who are engaged in private enterprise on their own account are affected as well as the big emporiums and major manufacturing concerns.

The Labour party objects to what the Prime Minister (Mr. Menzies) has done with the backing and support of his Cabinet. I heard the right honorable gentleman say the other night that his was a united party. The purpose of his broadcast speech seemed to be to emphasize something that did not exist, but I suppose that the parties on the Government side are united on the question of retrenchments. That was the only new point that I can remember the Prime Minister making, and it took him a long while to make it. The Opposition objects to the principle of retrenchment and also to the method by which it was introduced. The Public Service Board was not asked to investigate the matte:- and make recommendations. Speaking on this subject the Prime Minister said -

The target at which we aim in this matter and which we are setting out in our instruction to the Public Service Board is 10.000 At the moment there are about 150,000 people in the Commonwealth Public Service. We aim to release 10,000 of them to other employment.

In other words, the Government set the figure and then said to the board in effect. “ Let us get rid of 10,000 employees quickly, not because it is important or necessary to do so, but because we believe that that is the number we have to remove from the pay roll of the Commonwealth service. If efficiency suffers that does not matter. We must economize in numbers.” In the course of his statement, the Prime Minister set out the actual reduction* which the various departments were being asked to effect. There was to be a 5 per cent, overall reduction. No consideration was given to the importance of the work of each department, and the Ministers were not in a position to judge the situation fairly. The only body that could give a disinterested report to the Government was the Public Service Board.

Its members were asked to act as executioners and not as advisers. As was forecast by the Opposition, the position has become very desperate in some departments because of lack of staff. The Government has created its own difficulties. It decided to restrict imports. The result was a flood of mail to the Department of Trade and Customs in protest. I am told that at one time that department had 3,000 inward letters unopened. Not only had the volume of mail increased, but the staff was insufficient to handle it. Retrenchments prevented officers from being transferred from other departments to the department which was suffering from the latest actions of the Government.

Honorable members are told that the Government wanted to get rid of 10,000 public .servants. Actually there are 12,000 fewer public servants now and the efficiency of the service has suffered in consequence. If the Government intended that the persons who were retrenched should go into private employment, it was disappointed because most of those who were dismissed have been absorbed into State government departments and instrumentslities. The railways and tramways are run by the State governments or semigovernment agencies which have bigger staffs than they had before the retrenchments in the Commonwealth Public Service. No former employees of the Australian Government are going on to the land as was suggested by Government supporters in their arguments in favour of the retrenchment proposals. Neither have the retrenchments benefited essential industries as the Prime Minister suggested in his statement which in that connexion obviously referred to iron, steel and coal. The PostmasterGeneral (Mr. Anthony) stated in thi.? House since he was given that position after the elections in 1940 -

Any curtailment of services to the public would cause grave difficulties and would not be in the interests of the community, having regard to the vital importance of the communication services.

Yet under this scheme which was announced by the Prime Minister, thi’ Postmaster-General’s Department was asked to sack 4,000 men. Many of those who were retrenched were highly trained and skilled workers. The PostmasterGeneral’s Department is short-handed and there were threats of overtime bans at Christmas because post office employees were asked to handle an increased volume of mail with fewer workers to do the job. In this House to-day-

Mr SPEAKER:

– Order ! The honorable member cannot deal with proceedings that took place in this House to-day.

Mr CALWELL:

– Not even to say that the Postmaster-General was referring to the curtailment of mail services ?

Mr SPEAKER:

– Order ! No, the honorable member may not do so.

Mr CALWELL:

– I believe that when the Government acted as it did, its purpose was to help in the creation of a pool of unemployed, the “ Hytten pool which was talked about in other days. It has not succeeded in getting a pool of unemployed at once, but unfortunately the signs are that unemployment is increasing. The Government should look at this question of retrenchment again and ascertain whether it can employ in other departments some of the men whom it has dismissed.

Mr OSBORNE:
Evans

.- This matter has already been fully debated on a number of occasions. The Opposition has not got anywhere in its malicious attempt to prove that the Government is trying to establish a pool of unemployed. We all know that the reduction of the number of Commonwealth public servants has proceeded more smoothly and effectively than anybody could have expected. I have not heard of any public servant whose services were dispensed with in the circumstances referred to during this debate who has not been successively re-employed in some other sphere. The Opposition’s objections to the reduction of the Public Service have turned out to be quite empty-

Mr Bryson:

– That is completely stupid.

Mr SPEAKER:

– Order ! The honorable member for Wills (Mr. Bryson) must not so refer to the remarks of another honorable member. He must withdraw the expression.

Mr Bryson:

– I withdraw it.

Mr OSBORNE:

– However, we could very well examine the circumstances in which the Public Service was able to grow to such dimensions that drastic measures of the knid taken by the Government were needed to reduce it. As a legacy of eight years of administration by a Labour Government, the Public Service was so inflated and out of balance that drastic reductions of staffs became absolutely necessary. The Government might profitably undertake a comprehensive review of the efficiency and management of our public departments. No such review of the operations, efficiency and management of the Public Service has been made since the Gibson inquiry of 1919-1921. As the result of the Gibson report the Commonwealth Public Service Act was redrafted and brought up to date. It is high time that another inquiry of the same kind was held.

In 1921, the Commonwealth Public Service consisted of approximately 8,000 employees; to-day, it numbers 160,000 employees, plus an additional 60,000 employed by various instrumentalities of the Commonwealth who are not subject to the provisions of the Commonwealth Public Service Act. Every one will agree that what is suitable for the administration of an organization of a stated size is not necessarily suitable for the organization if its staff strength is multiplied by fr-ur. The very growth of the Public Service, necessary as I see it, has made essential a re-consideration of its management. Investigations of that kind are made in other parts of the English-speaking world. In England a comprehensive review of the civil service is undertaken approximately every ten years. I understand there is no statutory provision for periodical reviews of the British civil service, but successive British governments have arranged for them to be undertaken. Looking back over the past we find that these reviews have been made approximately every ten years.

In the United States of America a very complete investigation of the public service was conducted by the President’s Committee between 1935 and 1939. Periodical review is considered so important in the United States of America that as soon as that committee had presented its report another committee was established to start a new investigation in the knowledge that its task would take several years to complete and that by the time its work had been done circumstances would have changed and would have made another one necessary. The practice adopted in the United States of America supports my contention that periodical reviews of our Public Service should be undertaken in order to provide for changing circumstances.

It may be argued that under the provisions of the Commonwealth Public Service Act the Public Service Board is charged with the duty of conducting a continuous review of the service which it administers. I point out that the board is not only the administrator, but also the critic of the Public Service. The slightest application of common sense will show that a board which is charged with carrying out certain functions and at the same time is expected to criticize them, is not likely to give very great consideration to criticism of its own work. The functions of administration and of criticism of administration are entirely different and must be discharged by different organizations.

Investigations into the efficiency and management of the Public Service could be carried on with very little embarrassment to the Government. Once the decision had been taken to make the investigation, its personnel had been appointed and its terms of reference had been established, the investigators would carry on the work unaided. I urge the Government to give serious consideration to instituting a review of the Public Service - a matter which has been advocated for a long time by my colleague, the honorable member for Warringah (Mr. Bland).

Mr GEORGE LAWSON:
Brisbane

– Instead of praising the Government for having effected the alleged retrenchment of 10,000 public servants, I enter my emphatic protest against its action in dismissing many thousands of public servants who gave loyal service to the Commonwealth for many years, particularly during the war period. As long ago as February of last year, I protested against the dismissal of a number of temporary employees who had been employed in the Department of Trade and Customs in Brisbane, some of them for periods of up to thirteen years. Because of advancing years some of them were unable to secure posts in private enterprise, and many of them are still unemployed. It has been interesting to Opposition members to listen to the arguments that have been advanced by honorable members opposite in support of the motion, but their comments will not be listened to with such interest by the unfortunate persons to whom I have referred. When the Prime Minister announced that it was the intention of the Government to retrench 10,000 public servants, it was naturally assumed that most of those who would lose their posts in the Public Service would be temporary employees. I believe that in ordinary circumstances all members of the Public Service should be permanent employees, but I repeat that it is wrong, wicked and cruel to throw out–

Motion (by Mr. Eric J. Harrison) put -

Thatthe question be now put.

The House divided. (Mr. Speaker - Hon. Archie Cameron.)

AYES: 58

NOES: 37

Majority . . 21

AYES

NOES

Question so resolved in the affirmative.

Question put -

That the following paperbe printed : -

Public Service Retrenchment - Ministerial Statement

The House divided. (Mr. Speaker - Hon. Archie Cameron.)

AYES: 38

NOES: 58

Majority 20

AYES

NOES

Question so resolved in the negative.

Sitting suspended from 6.9 to 8 p.m.

page 33

QUESTION

FINANCIAL STATEMENT

Sir ARTHUR FADDEN:
McPhersonTreasurer · CP

– by leave - During the later months of last year, the Government brought down a series of important measures culminating in the budget, to deal with the serious economic situation that had developed during 1950-51. A number of major economic changes have occurred since then, and I think it would be appropriate if, at this early stage in the resumed sitting of the House, I were to review the situation as it now stands. I have it in mind as far as possible to trace the working out of the measures taken last year. I shall also deal with various criticisms of those measures and give particular attention to some subjects of policy such as the balance of payments, bank credit, housing, and public works, with which members will no doubt have a particular concern. The Government intends to bring down its budget for 1952-53 rather earlier than is usual ; but it cannot, of course, be until some time after the middle of the year. The economic and financial outlook will then be surveyed in detail. The statement I am now to make is therefore in the nature of an interim review. It cannot, in some respects, be as detailed as the House might wish, but I intend to make it as frank and as informative as I can.

For the sake of comparison, I may recall the situation that existed about the middle of last year. Upon the strong inflationary pressures which had developed through the war and post-war years, there had supervened a great flood of export income due mainly to the extraordinary rise in wool prices for the 1950-51 selling season. Other international prices had also risen as a response to the world armament boom, and we felt that rise in higher import costs. Wage rates and earnings had taken a sharp upward turn, largely because of the fi a week added to the basic wage by the Commonwealth Court of Conciliation and Arbitration, and because cost-of-living adjustments had assumed an entirely now order of magnitude. As a consequence, the year 1950-51. had seen an extraordinary rise in all the main elements of income and investment demand. National income rose by £800.000,000, or 35 per cent., farm incomes by £325,000,000, or 65 per cent., wage and salaries income by £320,000,000, or 26 per cent. During the year, the “ O “ series index of retail prices rose by 19 per cent., the wholesale price index by 24 per cent, and average wages by 26 per cent.

At the middle of the year, these inflationary forces appeared to be moving towards a climax. Pressures in every section of the economy had become more intense than before. Shortages of labour, materials and power were becoming almost intolerably acute. Many people began to fear major break-downs in essential services and industries. We confronted this kind of situation at a time when the necessity to expand our defence programme had become critically urgent.

I should not need to recall or justify in detail again the particular forms of action taken by the Government. They were canvassed at great length in this House during the budget session of last year. The fundamental lines of Government policy had been laid down some time earlier. We had rejected the policy urged upon us in some quarters of trying to check the inflation by freezing prices, wages and other costs and meeting uncontrollable cost movements by subsidies. ¥hat policy, as we can now see even more clearly than then, would have been as useful as dropping a cork into a volcano. The Government came to the basic decision that inflation had to be tackled at the roots by any and every means available to it and to the community at large. The demand for goods and the resources with which to produce goods had to be brought progressively into balance with the supply of goods and resources. We took that proposition as the determining principle of the whole scheme of measures that were applied.

The Government recognized at the time, and was completely frank in saying, that no immediate or spectacular results could be expected from this policy. Inflation had reached a high rate of momentum, which would inevitably carry forward a long way whatever might be done to restrain its progress. Price and cost increases which had already occurred would inevitably produce other price and cost increases sometime in the future. The great gap between demand and supply could not be closed at a stroke. Moreover, rising prices in countries abroad would necessarily transmit something of their effects to our income.

Some six or eight months have passed since the period that I have been describing. There are some encouraging signs in the present situation. The rate of increase in both retail and wholesale prices and in wage costs has slowed down. Rather better supplies are available in some of the basic materials. Th: acute labour shortages of last year have eased to some extent, and, in particular, there has been a gratifying movement of labour into basic industries such as coal and steel. I believe this to be a genuine result, of the action taken by the Government, aided by certain other forces which have helped to mitigate the inflationary pressures. We would not claim, however, that anything approaching a cure of our inflationary troubles has yet been achieved. The problem is still with us in a formidable degree. The Government believes that its policy is fundamentally the right one and it is determined to follow through with it. We take for ourselves, aud offer to the community, the encouragement of such gains as have been made; but with them must go a realization that a long and difficult road still lies ahead. Meanwhile, there have been at least two major changes in the basic factors determining our economic position and I shall next discuss the implications of these changes and of the steps taken by the Government in consequence of them.

At the opening of the sales for the current season, the average wool price showed a fall of about 25 per cent, on the closing price of the previous season and of something over 60 per cent, on the peak price reached in March last year. Later on, the price rose appreciably but then began to fall away again, reaching eventually a level somewhat lower than the opening market. In the result it appears that wool income for 1951-52 will be somewhere about half that of 1950-51. That is to say, it will be something like £300,000,000 compared with £600,000,000 in the boom year.

A fall of this magnitude could not help but have important economic consequences. Although wool prices may still be regarded as reasonably good by the standards of earlier periods, the level of costs in the industry had to some extent followed prices up in the boom period. Moreover, large areas in the wool-growing districts were severely affected by drought during the summer and also by bush fires. Both of these adversities entailed serious loss and expenditures. The net cash income of wool-growers for the current year must therefore be far and away below their receipts in 1950-51. This raises an acute taxation problem. Income tax and provisional tax is being levied during this year on the basis of the peak incomes for 1950-51. To meet their tax liabilities, therefore, wool-growers have only the greatly reduced cash receipts of the current year, and widespread evidence was soon forthcoming that very many growers simply were not in a position to meet their full tax liabilities. The Government went into the problem, and, by way of giving a measure of relief, it decided upon the provisional tax deferment scheme, details of which I announced some time ago.

Necessarily, this will affect our budget in a quite substantial way. In the estimates of revenue from income tax this year, receipts from taxation of wool incomes had bulked largely, but this element in the estimate has now to be scaled down. I do not intend at this stage to make any precise forecast of what the net result of our 1951-52 budget will be. I can, however, say that we will fall appreciably short of the surplus for which we budgeted, and the main single reason for this is the probable fall in taxation on wool incomes. Of course, the fall in wool prices has had effects extending far beyond the industry itself, because so much of our economy depends upon the level of wool income and the way it is spent. Both retail and wholesale trade have reflected this factor. So, too, have the railways and other forms of transport. Wo may say that in one sense the reduction of inflationary pressure from wool incomes is all to the good. Nevertheless, it has left behind a good many local and particular problems.

Probably the greatest and most immediate effect of the fall in wool prices, however, was the loss of export income, and that was a major element in the great balance of payments problem which developed rapidly at the end of 1951. For some years past, wool prices have been the main determinant of our export income. Other exports, of course, are important but experience for some years past has been that the total earnings from them are comparatively stable. Between 1948-49 and 1950-51 the value of exports other than wool fluctuated between £300,000,000 and £350,000,000 and for the current year their value will be somewhere within the same range. Wool exports, on the other hand, have been as low as £220,000,000 and as high as £620,000,000 The fall in wool prices this year is, in fact, the main reason why our export earnings are likely to be about £300,000,000 less than they were in 1950-51. In other words we will. have that amount less to spend on goods from overseas.

That is one side of our external account. Other factors were operating still more dramatically on the other side. Beginning about the middle of 1950-51, the monthly rate of imports began to climb in a most extraordinary way. By November, it bad reached the level of £110,000,000 f.o.b. which was equal to £1,300,000,000 for a full year. It was obvious at that stage that unless a fall in the rate of imports occurred serious difficulties lay ahead; but it was impossible to determine with any certainty whether any such fall would occur. Most people whose opinions were obtained - people in the business and financial worlds who were in a position to know about the volume of orders placed abroad and prospects for delivery - thought that a fall would occur after Christmas; but no one could determine accurately just when the fall would begin or how great it would be. We had necessarily to wait upon events. By the middle of February, however, there was sufficient information to indicate that a major fall in the rate of imports could not be expected before April at the earliest. Meanwhile the trend of wool prices had been downwards and we were losing London funds at a. rapid rate. On the best estimates that could be made it appeared that unless imports were restrained, the total for 1951-52 was likely to be of the order of £1,100,000,000 f.o.b. or, taking freight and insurance into account, about £1,250,000,000. The implications of this were all too plain. I.i was clear that by the 30th June, our international reserves, which had stood at something over £840,000,000 at the 30th Tune last, would be well below £300,000,000. Thereafter, because the September quarter in any year is always a relatively lean period for export earnings, we could expect to go on losing London funds at a relatively rapid rate. When such a point is reached there is a grave risk that capital movements may begin through a loss of confidence in the situation. We confronted the stark possibility that unless drastic action were taken our international reserves could easily be exhausted before the end of 1952. In bare terms that is the .story of the balance of payments crisis. We had to act and act drastically to preserve our international solvency. There were sound reasons to expect that in tha months ahead the rate of imports would fall away, but on the balance of considerations it seemed improbable that this fall would occur soon enough or go far enough to correct the position in time.

There has been criticism to the effect that we need not have acted at all in the way we did, because the situation contained its own remedies. That is illinformed criticism and the information I have just given refutes it. I do not need to carry that argument any further. Strangely, however, we have had the quite opposite criticism that we should have acted earlier than we did, in which case we would not have had to curtail imports so severely. There are various good reasons why we did not act earlier, and ] am prepared to state them frankly. The Government was reluctant to curtail imports till it became absolutely necessary. For ten or twelve years past oversea? supplies of very many kinds of goods have been difficult or impossible to obtain. It could hardly be expected that, either the Government or the publicwould be- anxious to cut off unnecessarily the supply of such goods just as they had again become available in adequate quantities.

As a Government we are against controls and we will always do our utmost to avoid them if we can.

Opposition members interjecting.

Mr SPEAKER:

– Order! I must ask the House to keep order. The Treasurer was granted leave to make a statement. I think that statement should be listened to in silence as I have no doubt all honorable members who intend to participate in the debate will hope to be heard.

Sir ARTHUR FADDEN:

– I repeat that, as a Government, we are against controls and we shall always do our utmost to avoid them if possible. There were very good reasons up to a fairly late stage for thinking that import controls might be avoided. It appeared that a substantial part of the sudden flood of imports was due to transient factors such as the grouped arrival of ships after long shipping delays, the sudden fulfilment of large orders for plant and materials and so on. Moreover, the powerful measures taken in Australia to reduce the inflationary demand for goods could be expected in the course of time to cut down the flow of imports. As I have said earlier, opinion in well-informed trade and financial circles considered that the rate of deliveries could be expected to fall away in the early period of this year. So long as there wa.s a reasonable possibility that import controls might not be needed, the Government could hardly be blamed for not rushing into them. More important still, the Government realized that the inflow of goods from abroad was helping very materially to stem inflation. For this very reason, as well as to assist development, the Government had worked steadily ever since it took office to encourage imports of essential goods. It bad bargained hard abroad to get supplies and ships to carry them. It had paid subsidies and remitted customs duties under by-law. It had borrowed money to pay for imports, as it did by means of the international bank loan. All this was part of a deliberate and considered policy to increase the supply of finished goods, material and equipment for Australia, and I venture to say that the great majority of people agreed with that policy. In fact, we were even criticized for not buying more imports, for not borrowing from overseas, or for not spending our London funds faster. It is ironic to recall now that, well within the past twelve months, various people, including one or more State Premiers, were demanding that the Government should do something really drastic to reduce the total of our London funds. Furthermore, our own balance of payments problem was closely interconnected with the problem of the sterling area, which was a subject of discussion at the London meeting of finance ministers in January. I shall say more about that subject at a later stage. Clearly, however, the outcome of the London discussions was certain to have some bearing -on our own situation and on the action to be taken here.

These are the reasons why the Government did not act earlier. I have stated them frankly and I consider that the Government has not the slightest need to apologize for any of them. They are all sound and valid reasons. May I add that there ought not to be any recriminations about what occurred, because few, if any, have grounds for recrimination. Practically everybody thought it was .a good thing to get more imports, as indeed it was, in several important ways. Governments and private businesses alike went out to get more imports. People in all sections of the community bought imported goods freely and paid what was asked for them. It was a good thing in several, ways to seek an import surplus, but the limits to which we could follow that course were set by the reserves available to us. We had to reach such a limit sooner or later. Through the need to take sudden and drastic action, dislocation has been caused to many business firms and expectations have been disappointed. I think it would be A’ery difficult, however, to find any one who honestly could claim not to have had some share in bringing about the difficulties which have occurred.

I shall refer now to the possibilities of overseas borrowings. It is common enough to say that restriction of imports is a negative way of dealing with the balance of payments, and that is certainly true. The Government, however, has been fully alive to the need for positive action to increase the amount of overseas funds available to us. Borrowing is one of such possibilities, and, when I was abroad earlier this year, I went into this subject very thoroughly indeed. I shall attempt to outline briefly the conclusions I reached. In the United Kingdom at the present time there appears to be virtually no possibility of public borrowing on any worthwhile scale. Internal demands for investible funds in the United Kingdom have increased enormously in. recent years, through nationalization projects, housing, the post-war reconditioning and expansion of .private industry and other factors, and only a very restricted amount is now available for investment outside the United Kingdom.. There is a long waiting list of would-be borrowers on the London market.

At the finance ministers’ conference, which I attended, the official policy was indicated very clearly. It is that, so far as funds may be available for investment abroad, a preference will be given to the colonies overseas and to those semiindependent territories, like Southern

Rhodesia, for the development of which the United Kingdom Government has certain responsibilities. With grave balance of payments difficulties of their own, the United Kingdom authorities are inclined to keep funds at home rather than to encourage them to move abroad.

In the United States, again, there seems to be no immediate prospect whatever of raising money on the open market. Fundamentally, the American investor looks for opportunities within his own country long before he thinks of investment overseas. In addition to this, there is undoubtedly an active prejudice in the market there against almost any kind of foreign bonds except those of Canada. Furthermore, the fact that sterling is not freely convertible into dollars puts a further obstacle in the way of borrowing by sterling area countries like Australia.

In Switzerland, there appear to be some possibilities of borrowing. The Swiss are in a strong external position and they have been making a number of foreign loans in recent times, including loans to South Africa. But the amounts are relatively small, and the terms tend to be rather stiff by our standards. However, the possibility of Swiss borrowing will be further explored by the Commonwealth.

The only other possible source of longterm borrowing is through the international bank, and, as honorable members are aware, we have had lately a mission in Australia from the international bank and a visit from the president of the bank. When the Prime Minister goes to Washington later this mouth, it is his intention to carry discussions with the international bank another stage forward.

As a short-term measure would help our immediate situation, we applied to the International Monetary Fund for a drawing against our quota in the fund, and, as already announced, we will purchase from the fund against Australian currency an amount of 30,000,000 dollars. This will be of direct assistance not only in connexion with the dollar problem, which I shall discuss presently, but also in connexion with our overall balance of payments problem. We must have well in mind, however, that currencies purchased from the International

Monetary Fund have to be repaid to that institution within a comparatively short period.

Summed up, therefore, the possibilities of borrowing abroad at the present time do not amount to a great deal. The Government will, however, fully follow up such possibilities as exist because it is important to obtain overseas funds, not only for balance of payments reasons, but also for the requirements of our developing economy.

In some quarters, the impression appears to have been formed that the action taken by the Government to restrict imports was a direct result of the finance ministers’ conference held in London during January, which I attended as the representative of the Australian Government. This, however, is an erroneous idea. We would have had to reduce imports in the way we did even if the finance ministers’ conference had never been held, because the overall balance of payments difficulties confronting us would have had to be dealt with in any case. The meeting in London was concerned with the separate, though related, problem of the sterling area deficit with the nonsterling world and the running down of the central gold and dollar reserves. At the conference, agreement was reached between the sterling area countries represented there on three principal objectives as follows: -

  1. That the sterling area as a whole should be in balance with the rest of the world at latest in respect of the second half of 1952.
  2. That within this balance with the non-sterling world there should also be at least balance with the dollar area.
  3. That where any country in the sterling area was likely to be in overall deficit, corrective measures should be taken as soon as possible.

The impression to which I have referred may have arisen from a misconception of what the third of these objectives was intended to do. If a country within the sterling area had a deficit in its overall balance of payments, it would in all probability be drawing away from the sterling area countries ‘resources which would otherwise go to earn non-sterling currencies. It would probably be drawing also to an excessive extent upon the reserves of the sterling area to pay for non-sterling imports. This was, in fact, the case with Australia. Therefore, by taking action to balance, our own external accounts we would be helping to remedy the deficit of the sterling area with the rest of the world. This is what the third objective really proposes. The necessary action implied in the objective, however, was such as we would need to take,, and did in fact take, for the maintenance of our own international solvency. It may l.»e said that there was a coincidence between the objectives arising from the conference and our own national objectives, but that is different from saying that the. conference laid down or directed what we, as a Government, should do. As to any of the agreed objectives, it was left to individual countries to pursue them in their own ways.

By the restrictions announced on the St,11 March, which reduced imports from all countries other than those of the dollar area and Japan, we did make a contribution to the task of saving non-sterling currencies. It was necessary, however, that we should also act to reduce our direct call upon the sterling area dollar pool. That was the purpose, of the decision subsequently announced to recall outstanding dollar and other licences. It was also the purpose for which we have now purchased 30,000,000 dollars from the International Monetary Fund. We have taken this action because we have n vital responsibility for the preservation of the sterling area system. We are an important part of that system, and we find great advantages in our membership of it. It follows that we must always be prepared to measure up to the. full obligations which membership of the system imposes. As all honorable members know, since the middle of last year there has been a rapid progressive call upon the gold and dollar reserves held in the United Kingdom. By the end of the March quarter of this year, these reserves had fallen to a level of 1,700,000,000 dollars, equal to £stg.607.000,000. At this level the reserves must be regarded as dangerously low, and action of a drastic kind to maintain them is fully justified.

At the finance ministers conference, however, I may say that I found a most gratifying acceptance of the point of view which this Government has maintained about the dollar problem, which is that it cannot be solved merely by the negative process of curtailing imports and that measures must be taken, collectively and individually, by the. countries concerned to improve their earnings of non-sterling currencies, particularly of dollars, and to attract investment from outside the sterling area. The conference, in fact, agreed that full convertibility of sterling must be taken as the common goal of sterling area policy, and that the member countries must direct their national policies towards the eventual achievement of convertibility. It was recognized that this involved the fulfilment of certain basic conditions. In particular, it required that during the next few years the sterling area countries should aim to have a surplus with the non-sterling world, and with the dollar area in particular; that each country should endeavour to live within its means after taking account of any investment it could attract from abroad; and that the member countries should do everything possible to facilitate the. entry of non-sterling capital investment. Those are difficult conditions to fulfil. That fact was fully realized. They are, however, in themselves, sound principles of national policy. If they are the price which must be paid for the achievement of convertibility of sterling, they are, nevertheless, a price worth paying to restore sterling to the universally strong position it held in other days.

At this point I should like to say how greatly I was impressed by the frankness with which the discussions were conducted at the finance ministers’ conference, and with the competence and breadth of outlook displayed by the representatives of our fellow countries in the British Commonwealth who gathered there.

I made some reference earlier to the valuable effect which the flow of imports had exercised in reducing inflationary demand within Australia. Whilst the import boom has led us into great balance of payments difficulties, it has, at the. same time, provided a most useful supplement to our other anti-inflationary measures. The great inflow of finished goods, materials and equipment,, exceeding in amount the income we were obtaining from exports, operated to soak up excessive purchasing power, relieved pressure on supplies of locally produced articles and discouraged excessive investment in industries producing consumption goods. Even though we have had to apply import restrictions,, we will still reap benefit from these developments. A lot of goods not affected by the restrictions has still to come in. Of those goods which have already been delivered, considerable quantities are undoubtedly held in stocks. When these additional supplies eventually come on to the market they will operate to absorb some part of the still excessive monetary demand. We can expect this effect to continue, though in a diminishing degree, for some months yet. However, the import surplus will be a declining influence, and. some time before the end of 1952 it may well have disappeared altogether.. By then imports and exports should be more or less in balance, and there- will be no surplus of any significance’ one way or the other.

In this situation, some very dangerous inflationary tendencies could arise. If there were to be an all-round attempt to extend local production of consumption goods to replace import’s, further excessive strains would be imposed upon our limited resources, and the inflationary spiral might receive a new and powerful impetus. It would be different if we had resources to spare, but we have not. Even though, as I said earlier, there has been some easing of the basic shortages, we are still a long way from having any productive capacity in reserve. I hope that industry will take this view of the position and recognize that the important thing now is to concentrate on essential production. Industry should realize, moreover; that the import restrictions are intended to be only temporary. Therefore, industries would be courting loss: if they were to invest capital in new or expanded lines oi production, and to rely only on. the chance that import controls would continue. As I have, said, it will be found necessary to. extend some branches of local production to replace imports that we can. no longer obtain., The- Government: has this possibility well in. mind and, as> the Prime Minister has announced, special attention will be given by the Commonwealth Bank and the Capital Issues Board to cases of this kind. By and large, however, we must do our utmost tO’ avoid any indiscriminate extension of. secondary industry which the import restrictions may tend to encourage.

Control of imports has been, introduced to meet an. emergency. Therefore, the restrictions must be regarded as temporary in character. It is the firm intention of the Government that they shall be so. The Prime Minister has already given a public assurance to that effect. The controls will not be allowed to remain in force a day longer than is necessary. There should be no misunderstandings, however, as to the conditions which must be fulfilled before the controls can be removed or modified. By the time, the situation has been brought into balance, our external reserves will be at such a level that we cannot count upon spending any more of them to pay for imports. Therefore, we cannot contemplate importing more than we can buy from the proceeds of our exports and from such borrowing as we may be able to arrange, or from such overseas private investment as may come to Australia. It follows that the more we can earn abroad, or the more investment we can attract from abroad, the more we shall be able, to buy in. the form of imported goods. Indeed, we should aim to do more than simply pay our way. We should also endeavour to add progressively to our reserves so that in due time they will again be restored to a safe level as a protection against future emergencies. This implies an effort to increase our exports and to attract investment here. There.- is, however, one still more important condition to be satisfied before we can look forward to freely running external trade. The prime reason for the great boom, in imports was undoubtedly the inflated condition of demand for goods within Australia. We tried,, and. indeed succeeded for a time, in buying more, than our external earnings would cover; but that state of affairs could not go on. It has now had to be brought to an end by the imposition of import restrictions. These restrictions, however, are and should be regarded as no more than a stop-gap remedy. The main cure remains to be completed. We have to cut down the excessive demand for goods which spilt over into overseas markets and helped to bring on the excessive import boom. In other words, the restoration of balance in our external accounts and the possibility of getting rid of import controls depends, as do so many other things, upon getting inflation under control. In this, therefore, we have a still further reason for adhering firmly to the broad scheme of anti-inflationary measures applied by the Government.

We come back, therefore, to the interna! situation. Events are proving more and more clearly that the. internal situation is the main source of our economic difficulties. Until we have brought our home economy into a. state of equilibrium, we shall have, solved none of our troubles, internal or external. So [ propose now to deal with certain branches of antiinflationary policy that have lately received a great deal of public attention. One of these is the subject of bank credit and capital issues control. It has often been explained to the House that control of bank credit has two major phases. One is concerned with the overall monetary situation as affected by expansion or contraction of bank lending, and its main instrument under existing arrangements is the special account procedure operated by the central bank. It was established during the war and has been carried on ever since. It operates by requiring the trading banks to deposit a certain part of their assets in special accounts with the central bank. Were this not done, additional cash becoming available to the trading banks, for example, as a result of a rise in export income, would permit them to lend increasing amounts of money to the community at large and, in so doing, add to the supply of purchasing power. Naturally, the amounts deposited by the trading banks in the special accounts are varied from time to time with circumstances. During the wool boom in 1950-51 the total amount rose steeply. It reached a peak of £578,000,000 in May last year.

The system, however, is not administered in any rigid way, as is proved by the relevant figures. When it has become necessary for the trading banks to increase the amount of their advances to .the business community, for example,’ to finance imports, releases have been made from these special accounts. In fact, these releases have reached very big figures in recent months. From the peak of £578,000,000 in last May, the .special accounts have now fallen to somewhere about £430,000,000, or about £150.000,000 in a year. This, I think, provides a sufficient answer to those who argue that the Government and the central bank are enforcing a money shortage on the economy and that they are keeping unduly large resources sterilized in reserves. Of course, it would be utter folly to release all at once, as we are sometimes urged to do, the whole of this great amount of surplus money. We have suffered so long from a surfeit of purchasing power that it would be sheer madness to augment the supply in that fashion. Control of these deposits rests in the hands of the Commonwealth Bank Hoard, which is responsible, under the bank’s charter, for preserving stability of monetary conditions within Australia. It can, without doubt, be trusted to ensure that this responsibility is administered neither too rigidly nor too elastically for our economic well being.

The other .branch of bank credit control consists of the advance policy instructions issued by the Commonwealth Bank to the private trading banks. Their purpose is to ensure that the volume of bank credit available at any time is channelled to those branches of industry and trade, that contribute most to essential production. This system also has been operating for some years past. The instructions are modified from time to time in the light of experience. They are the subject of consultation between the Commonwealth Bank and the Government, and also between the Commonwealth Bank and the trading banks. This ensures’ that they are adapted as required to the changing needs of the economy as part of the general antiinflationary programme. But it would be quite wrong to suppose that they prevent expansion of credit in any and every direction. Nothing could be further from the truth. In June last year the average weekly advances of the private trading banks totalled £509,000,000. The average for March this year was £604,000,000. Thus, in the space of nine months, there had been an increase of no less than £.155,000,000. A good part of this increase has been used to finance additional imports; but other branches of trade and industry have also had a share. Again, it is clear that banking policy in this regard is not being applied rigidly or unrealistically. It is being modified and conditioned according to changing requirements and circumstances, and as a contribution towards the sound economy that we wish to achieve.

Capital issues control can be bracketed with advance policy, for both serve similar purposes. Broadly, what bank advance policy does in respect of short term banking finance, capital issues control does in respect of long term share or mortgage finance. I do not propose to discuss now the detailed application of capital issues policy. The control is administered under me, as Treasurer, by a capable, experienced and representative board which reports to me periodically, and I in turn report to Cabinet. Periodically Cabinet makes a thorough review of capital issues policy, and confirms or modifies its policy instructions to the Capital Issues Board. Capital issues control has been applied rigorously during the past year but we do not have to apologize for that fact. At a time when there was the most urgent need to concentrate resources on essential production, it would have been foolish to have allowed a “ free for all “ situation in the capital market with an undue share of funds going in many cases to nonessential activities. Capital issues control was designed to prevent that and I think it has had a very considerable measure of Bli. rees in doing so. Now that funds for private investment are becoming less plentiful than they were some time ago, the value of this control is becoming even more apparent, because it operates to give a certain priority to really essential projects when they go out to raise capital. “Without this organization, it is quite certain that our general scheme of an ti- inflationary measures would be a good deal less effective.

The subject of housing finance was covered by the Prime Minister in a statement which he made to the House not long before the end of the previous sessional period. He also dealt with housing in his recent public statement following Cabinet discussions on economic policy. I do not, therefore, propose to traverse the subject again in a general way but will confine myself to one major comment. In some quarters it often appears to be assumed that the Commonwealth ought to make unlimited finance available for housing, whatever the circumstances may be. That is a fantastic idea. It has been pointed out more than once that the Australian Government and its agencies are this year making available over £60,000,000’ for housing finance and over £50,000,000 of that enormous sum is being raised by taxation.

As to the demand that the Commonwealth should do still more, let me first of all say that we could not provide a penny more for housing unless we increased taxation or resorted to use of central bank credit for the purpose. Going beyond this, however, there is a further vital consideration. Because housing is scarce, and because it meets a basic social need, housing has had a top priority in Australia ever since the war. But it has long been recognized that there were some very unsound and unsatisfactory features about the building industry. The fact that demand so far exceeded supply has given rise to some most wasteful practices. The industry, in fact, has been a major source of inflationary pressure within our economy. Notoriously it has been a hot-bed of “ go-slow “, overtime chasing and black-marketing of materials. Costs have risen inordinately. The turnover of labour has been high and its productivity low. Because of the priorities given to housing for material and equipment, other branches of industry and construction have gone without and have been subject to pressure and cost increases.

The fact that costs have risen so unwarrantedly high has been a cause of increasing difficulties for intending home purchasers. When the cost of comparatively modest cottages got up to and even above £4,000 it was inevitable that a great many people would find it impossible to purchase them, even though relatively liberal finance could be had. In consequence, we have on the one hand all sorts of extraordinary developments within the house-building industry. The proportion of houses being built by owners has risen greatly, indicating that these people simply could not afford to have their homes contract-built. The difficulties of home seekers, baffled by the rise in costs, has stimulated the demand for more and more governmental finance.

Is it suggested, however, that the Government should meet this demand without limit, whatever the circumstances might be? I suggest that, were it to do so, the outcome would not be more houses but simply the perpetuation and encouragement of the practices which have done so much to force up the price of homes beyond the reach of the ordinary person. The plain truth is that the building industry has to find a much more economic basis. The cost of housing simply must come down. There are, at present, some signs that this is beginning to happen. In some areas building materials are becoming rather easier to obtain and so, too, are some types of building labour. But no one, I think, would pretend that the situation in the building industry has yet reached a sound and efficient basis.

The Government fully recognizes the importance of housing as a social requirement and as a factor in the level of economic activity. At all times it watches the position in the housing field very closely. We are aware that in some areas the number of houses being commenced has fallen away. On the other hand, we also know that the number of houses now being completed is rising and that, surely, is a good thing. At present, I understand that houses are being completed at a rate of between 70,000 and SO, 000 a year. There is also a great number of houses under construction throughout the country. At the end of last December, I believe, that number was about 85,000, representing a total investment of about £290,000,000. Obviously the building industry has plenty of work to do. The Government, as I have said, is not oblivious to the need’ for maintaining a high level of building activity. It does insist, however, that the industry should reach and maintain a reasonable state of efficiency and an economic level of costs.

Considerable interest now centres on public works because of the meeting of the Loan Council last week. That meeting was held to decide upon borrowing programmes for the financial year ] 952-53. To follow the issues clearly, we should perhaps remind ourselves again that the Loan Council is a joint CommonwealthState body and that in the matter of raising loan moneys the Australian Government acts only as an agent for the Loan Council. Beyond this it has no constitutional responsibility. It certainly is not responsible for providing the State governments with funds for works purposes from its own resources.

May I also mention another important fact which has a considerable bearing on current issues? It is fair to say that at no stage in the post-war period have the State governments been short of money for works purposes. In fact, there have been several years in which they have simply not been able to spend up to the full amount of the programmes approved at the Loan Council. I state this because a good deal has been said to suggest that Commonwealth financial policy is in some way responsible for the slow progress of important developmental works such as power stations, port and harbour improvements, roads, and water and irrigation schemes. If these projects are running behind schedule, there is one factor which cannot possibly be blamed and that is a shortage of money. If money could have remedied black-outs, transport difficulties and the like, then w-e should have been rid of these difficulties years ago. What I have just said applies as much to the current financial year as to earlier years. It is quite plain now that notwithstanding all that was said after the Loan Council meeting last August, the State governments will have adequate funds this year for works purposes.

Ti,e House will recall the outcome of the August Loan Council meeting and the subsequent measures taken by the Commonwealth in consequence of it. The position briefly was that the States brought forward governmental programmes which required £300,000,000 although it appeared most unlikely that the loan market in the current financial year would yield as much as it did in the previous year, when about £125,000,000 was raised. Because the Commonwealth was concerned to ensure that the essential parts of the programmes of the States should be carried out, it underwrote those pro.grammes up to an amount of £225,000,000, which meant that any difference between loan raisings this year and the amount of the guaranteed programmes had to be met from Commonwealth resources. As it happens, no more than £83,000,000 has been raised on the markets this yea.r for works purpose.-. Therefore, taking account of small domestic raisings in the States, the Commonwealth will have to provide somewhere between £150,000,000 and £160,000,000 for State purposes. Although they knew what had happened to the loan market, and must have had a good idea of what was likely to happen in 1952-53, the State governments last week brought forward loan programmes which totalled £351,000,000. This represented an increase of £126,000,000, or 55 per cent., on the programmes for the current year. It was a completely crazy proposition. In addition, they put forward programmes for semi-governmental and local authority borrowings which amounted to £124,000,000. Thus, in total, they asked no less than £475,000,000 for the next financial year. Eventually at the Loan Council meeting the State Premiers, acting together, put forward programmes which totalled £247,000,000 as an alternative to their original demands for £350.000,000. The fact that they could so readily cut their programmes back by more than £100,000,000 suggests how much padding there must have been in them. The Premiers made it quite clear that they wanted the Commonwealth again to guarantee their programmes as a whole. The loan prospects being what they are, the revised State programmes of £247,000,000 would have necessitated the Commonwealth agreeing to find nearly £200,000,000. Apart from any question of policy, or principle, financial prospects are such that the Commonwealth simply could not undertake to find such a sum and it told the States so.

As an alternative, it offered to provide by way of special subscriptions to loans, an amount of £.125,000,000 in 1952-53’. Then, if the market were to yield £50,000,000 and if the States could raise a small amount domestically, as they usually do, and if they would be content with rather smaller “ carry-overs “ at the end of that financial year, they would have the reasonably firm prospect of obtaining at least £190,000,000 for works purposes. This would, have been a rather smaller overall total than in the current year, but under all circumstances it would have given them a quite reasonable programme.

The States did not accept our offer but went ahead to vote a borrowing programme of £247,000,000 for the year, it is most unlikely that they will get it. The Commonwealth has indicated that its offer to the States still stands. The main points of that offer as they were staled ro the Premiers are as follows: -

First, we are prepared to assist the States by arranging for special subscriptions to Commonwealth loans raised for Loan Council programmes up to a maximum of £ 125,000,000.

Secondly, we are prepared to vote for a Loan Council borrowing programme equal to the sum of that amount of special Commonwealth assistance, the net amount of new money that we estimate the public loan market will yield in 1952-53, and the amount of domestic loan raisings. This sum-total we estimate at approximately £180,000,000.

Thirdly, until after the result of the first loan raised in 1952-53 is known, we shall be prepared to make monthly advances to the States on that basis, after taking into account carry-overs at the beginning of the year.

Fourthly, if the result of the first loan should indicate a more healthy loan market, we shall be prepared to consider monthly advances which would accord with the reasonable expectations from the loan market.

Fifthly, this offer is made on the clear understanding that all demands for advances under the Commonwealth-State Housing Agreement will be included in the Commonwealth borrowing programme and that the total of such demands will be a charge against the sum-tatal of £180,000,000 referred to above.

Sixthly, should the States choose to approve a borrowing programme in excess of the amount stated above, the Commonwealth will not vote for it, but it will do its utmost to rais” the maximum possible amount from the loan market, but without assuming any responsibility for raising the total amount voted.

Finally, should the actual borrowings for the year appear likely, later in the year, to fall significantly short of reasonable expectations (which clearly cannot be set higher than £200,000,000 in all) the Commonwealth will not raise objection to the States reducing the amounts proposed to be “ carried over “ at the 30th June, 1953, to a total of approximately £13,000,000.

The States have been told that the Commonwealth will make finance available to them month by month on the basis of its offer. There is much extravagant talk about the unemployment that will be caused and the great projects that will have to be terminated, but I am convinced that we need not take these predictions too seriously. Much the same forecasts were made nine months ago and, as I pointed out earlier, they came to nothing. It is, however, vital that the House should realize what the alternative course of action would entail. If the States wen to be given as much money for works as they have asked for, there would either have been staggering increases of Commonwealth taxation or the Government would have had to call upon the Commonwealth Bank for great amounts of treasury-bill finance. This latter course could not fail to have disastrous consequences. It would add in a major way to the excessive purchasing power now active within our economy and in so doing it would give a strong impulse to renewed inflationary pressure. All that the Government has clone and all that other authorities and organizations have done to combat inflation would be set at nought. I can conceive of no more irresponsible action for any government to follow under present circumstances than, to use bank credit to the extent asked for by the .States.

Less perhaps in these times than ever before can we afford to be dogmatic about the future course of economic affairs. The outlook is too obscure, and events are too changeable. There are, I know, some who tend to think that inflationary forces are petering out and that we can expect a levelling, and even a reversal, of current economic trends. Some even go so far as to predict a degree of unemployment. Although such opinions must not be ignored we must give full weight to the factors which obviously are operating to perpetuate inflation.

Throughout the major Western countries, rearmament is in full swing, and this must inevitably tend to keep world prices moving upwards. Within Australia our own defence expenditure has reached high levels and is constantly growing. Despite any restraints that may be imposed by the recent Loan Council decision, there will continue to be a tremendous body of public investment activity in Australia. Private investment is also still running at a high level although it is more restrained than it was twelve or eighteen months ago. We have to conjure also with the very considerable fact that, through the necessity to curtail imports, the volume of goods available in Australia will be substantially less than it has been during the past year or so. Unless demand for goods can somehow be adjusted to this new situation, the pressure on available goods and resources will necessarily be accentuated and the conditions that have caused prices and costs to rise will remain with us.

On a broad view, therefore, I cannot see that we should be justified in casting off the restraints which the Government has sought to apply through its antiinflationary programme. The better course is to push forward towards our general objective, at the same time continually adapting measures, one way or the other, to meet particular changes in economic conditions. Our aim is exactly as it was a year ago, namely, to restore a fundamental state of balance within the economy. Until this goal is much more clearly in sight there cannot be any thought of throwing our instruments aside.

I lay on the table the following paper : -

Financial Statement by the Eight Honorable Sir Arthur Fadden, K.C.M.G., M.P., Treasurer, and move -

That the paper be printed.

Debate (on motion by Mr. Calwell) adjourned.

page 46

WAR SERVICE HOMES

Debate resumed from the 28thFebruary (vide page 564, Volume No. 216), on motion by Mr. Townley -

That the following paper be printed: - War Service Homes - Ministerial statement.

Dr EVATT:
Leader of the Opposition · Barton

– On the last occasion that this matter was before the House I had practically concluded what I had to say. The Minister for Social Services (Mr. Townley), who administers the War Service Homes Act stated that after a certain date assistance to returned servicemen in respect of existing homes will not be continued. Although he later announced a modification in the case of existing contracts for such homes, the broad principle of the Government’s action in this matter is as I have stated. The honorable member for Lalor (Mr. Pollard) dealt with this subject from the point of view of the Opposition, but to give the House an opportunity to express its opinion of the principle involved in the statement of the Minister, I move -

That the following words be added to the motion : - “ and this House expresses the opinion that the Government should arrange to continue and fully maintain assistance under the War Service Homes Act for the purpose of enabling servicemen to purchase an existing home “.

Mr Calwell:

-i second the amendment.

Mr POLLARD:
Lalor

.- The subject-matter of the debate at the moment is of profound importance to the returned servicemen of Australia. It follows upon the action of the Govern ment in November last when it introduced legislation to amend the War Service Homes Act. During the course of the debate on that occasion it was revealed that, among other purposes, the amendment was designed to increase the amount of the advance that mightbe obtained by applicants for war service homes, but only in respect of homes which the War Service Homes Division was able to build or proposed to build; it denied financial assistance to those ex-servicemen who were able to negotiate privately with a contractor, or the owner of a new home or an old home. Previously, it had been the practice of all governments to approve, through the War Service Homes Division, the discharge of mortgages in relation to existing properties, new or old, and thereby to assist returned servicemen to become owners of properties. If the War Service Homes Division itself could not build the home or could not securea contractor to build it; or if the soldier himself could not arrange to secure the services of a builder who had been approved by the division he still had some prospect of securing a home by the process of discharging the mortgage on an existing property.

During the debate on the bill introduced by the Minister for Social Services (Mr. Townley) it became evident that some dissention existed in the ranks of the Government parties. It was necessary that the amending bill should be studied in order to ascertain by what method the Government proposed to implement the restrictive policy which the Minister referred to in his second-reading speech. With perfect clarity he announced then that it was the intention of the Government, in respect of homes built by the War Service Homes Division, or in respect of which an ex-serviceman could secure a contract approved by the Division, to increase the advances available from £2,000 to £2,750. However, the Minister also announced that in respect of an existing property, be it old or new, which the soldier had selected himself, and the structural condition of which was approved by the division, the advance would still be restricted to £2,000.

However, as the debate on the measure proceeded, and as the announcement by the Minister was more closely analysed, it was revealed that even an advance of £2,000 would not be made available by the Government in respect of the purchase of an existing property or the discharge of an existing mortgage. Careful study of the bill disclosed that the Government intended to prevent the purchase of an existing property or the discharge of an existing mortgage by the use of machinery contained in the proposed amendment of section 20 of the principal act. That section, which had been in operation since the end of World War I., provided that the Director of War Service Homes, at his discretion might, among other’ things, arrange for the construction of homes, the purchase of existing properties, or the discharge of mortgages on properties approved as suitable.

  1. wish to emphasize that the Director of “War Service Homes was entitled, under the act, to do all or any of those things in order to assist returned soldiers. By means of the amending legislation, his powers were taken away from him. For the edification of honorable members and also of ex-servicemen who were promised that war service homes would be in a de available to them, I point out that the amendment of section 20 of the principal act reads as follows: -

Bil,im t to t 11 i: Act and to the directions of the Minister as to matters of general policy, the Director may, upon application in writing, make an advance to an eligible person on the prescribed security, for the purpose of enabling him - («) to erect a dwelling house on a holdi jio- nf the applicant.

Formerly the director could erect a dwelling house on land owned by the soldier or of which he was the lessee under a Crown lease, purchase land and erect thereon a dwelling house, complete a partially erected dwelling house, enlarge a dwelling house, or discharge any mortgage, charge or encumbrance existing on a home or holding. Those were the powers of the director under the act prior to the enactment of the amending legislation introduced by this Government.

In his second-reading speech the Minister blandly announced that no longer was it to be the policy of the Government to advance moneys or to discharge mortgages on existing properties. Let us consider how vital that is to the whole policy of war service homes construction. For the information of honorable members I point out that since the inception of the war service homes scheme at the termination of hostilities in 1918 the War Service Homes Division has built, or has arranged finance for the discharge of existing mortgages in connexion with 75,500 homes. It is interesting to note that 32,000 of the transactions for which finance was arranged related to the purchase of existing properties or to the discharge of mortgages. That is the story in a nutshell. I invite honorable members to consider how much more vital the principle has become in existing circumstances. Since the cessation of hostilities in 1945, the War Service Homes Division itself has built 11,000 homes, but 26,000 transactions have been financed by the division for the purchase of existing properties or for the discharge of existing mortgages. That policy has resulted in the provision of homes for many thousands of servicemen of the two world wars, but the Government has announced, in effect, that only one of the two methods that were adopted in the past to provide homes will be continued. Moreover, the figures show that the method which the Government will continue has provided the least number of homes for soldiers.

The position in 1951 emphasized the need to continue the policy that previously proved so successful. In that year, only 26 per cent, of the transactions for soldiers’ homes were direct contracts for building by the division itself whereas 74 per cent, of the applicants obtained homes which were existing properties or for which arrangements were made to discharge mortgages. If the demand for soldiers’ homes is as great this year as it was last year, only 26 per cent, will be satisfied as the result of the provisions of this amending legislation. I admit that the aims and objectives of the Minister and his colleagues may be all right. They claim that the discharge of mortgages on existing properties and the purchase of existing properties will not add one home to the total number that are available in Australia for occupation by soldiers and their families. However, that has always been the case. If it had not been for the policy that was laid down in the past by other governments, allowing the division to purchase existing properties and discharge existing mortgages,, considerably less than 50 per cent, and probably under 40 per cent, of the ex-servicemen who have obtained homes would be purchasers or owners of homes now.

Arising out of these circumstances and to appease two members of the Government who staged a revolt within its ranks, the Minister for

Social Services made a milk-and-water statement on the 28th February, J 952. In effect, he said, “In any case where a soldier has practically completed his arrangements for the purchase of a home before the 28th February and can demonstrate to the division that he may lose his home if the contract is not concluded, the Government will graciously arrange for the completion of the contract between the soldier and the seller “. That is the Government’s appeasement policy and it does not mean a thing because it applies no longer. It cannot apply because the limiting date was the 26th February. By a change of policy that was unknown to the soldiers themselves, the right of the soldier to arrange for the purchase of an existing property oi- for the discharge of a. mortgage has disappeared entirely. The Treasurer (Sir Arthur Fadden) has referred to the chaos in the building industry.

Mr SPEAKER:

-Order! The honorable member cannot refer at this stage to the events of to-day in this Parliament.

Mr POLLARD:

– It was just a passing reference, sir. The Treasurer referred to the necessity for people to build their own homes. Everybody realizes that there are difficulties in the. building industry. The War Service Homes Division itself has been deeply affected. It has not been able to operate, on the blackmarket to secure contractors and give fantastic prices on behalf of soldiers. The division cannot engage in illegal transactions. That is all the more reason why the old policy should be continued when a soldier presents a first-class proposition for the purchase of an existing property, old or new, and needs the financial facilities that have been available since the war of 1914-1S. Until this House, is given an assurance by the Government that those facilities will be available throughout the country, thousands of dissatisfied soldiers and their wives will be in opposition to the Government on this question.

Honorable members know that the loan moneys available for the Minister and his department were limited to £25,000,000. Would it matter to the Government if approved applications involved £30,000,000? The Government said, in effect, to the ex-servicemen, as it has said to the unfortunate State governments, “ We are sorry, boys, but we have run out of loan money “. The Government did not tell the men when they enlisted that if it were short of money, they would have to wait for homes. In these circumstances, not only members of the Opposition should support the amendment that has been moved by the Leader of the Opposition (Dr. Evatt). Those who have been critical of the Government’s policy should live up to their threats and indicate that they disagree entirely with the policy of the Government which has discontinued a practice that, has been satisfactory to the soldiers. Every member of this House should record dissatisfaction with a policy which limits the opportunities of exservicemen to obtain homes.

Mr TOWNLEY:
Minister ;or Social Services · Denison · LP

, - My remarks will be brief, but I welcome the opportunity to make them because it is highly desirable that I should present the facts to the House. Never before has there been such a mass of misstatement, illogicality and deliberate misinterpretation of my statements and of those of others whose words arc less likely to be misunderstood than are mine. In this House on two previous occasions, over the air and in press statements, I have enunciated the policy of the Government in relation to war service homes ; but either deliberately or unintentionally my remarks have been misconstrued and misinterpreted by honorable members opposite. I shall not ask the House merely to accept my word on this matter: I shall substantiate my statements with figures. As a general indication of the kind of misstatements that have been made about this subject I produce to the House, through you, MrSpeaker, a. copy of an article that was published in a certain newspaper. I hold in my hand a press report which is headed, in big heavy type, “ £2.000,000 homes concession forced from the Government”. That sort of misstatement is consistent with the misstatements that were made by the honorablemember for Lalor (Mr. Pollard) only a few moments ago. The interesting aspect of the newspaper article is that it bears- the date-line “Canberra, “Wednesday”. The newspaper from which the cutting was extracted was published in a capital city on a Thursday. The article reads -

Hank and file members of the Liberal and Country parties in an outspoken discussion to-day at a joint party meeting forced the Government to alter drastically the proposal to amend the War Service Homes Act.

The writer then mentioned the name of a man who was not present at the meeting and referred to another man who was said to have made a powerful statement but who, in fact, did not speak at the gathering.

Any member of this Parliament who asked the Secretary of the Treasury to inform him of the date upon which with him and one of his senior officers I finalized the provision of an additional £2,000,000 in the budget for war service homes would be informed that that took place on the Friday which preceded the clay upon which the party meeting to which the newspaper article referred was alleged to have been held.

The honorable member for Lalor has suggested that by some strange alchemy I had taken to myself certain powers from the Director of War Service Homes - that I had become a kind of sawdust Caesar. I do not know whether honorable members are aware that the Director of War Service Homes has wrestled with professional wrestlers and was at one time a renowned middleweight champion. The idea that. I had pushed him round is amazing. The honorable member for Lalor knows very well - perhaps much hotter than I do because of his long political experience - that in days gone by although technically the director was empowered to do certain things, his power to do them was completely limited by the amount of funds made available to him 1,i his Minister. A quibble of that kind i.s mere- apple sauce!

By inference the honorable member said that we had altered our policy in relation to war service homes. In a long and involved attempt to explain how we had done so, the honorable member said that we had done something which we should not have done and that as a result ex-servicemen were broken-hearted. The truth is that every month we have received 2,000 applications for war service homes. I could cite Hansard to prove that the honorable member has also said that the granting of a loan of £2,000 for the purchase of a war service home was completely useless and that ex-servicemen could not obtain homes for that figure. The truth is that there has been such a rush of applications for assistance of that kind that we have had completed a twelve months’ programme in a little over eight months, and we have had to ask applicants to wait their turn. That is the kind of misrepresentation which characterized the whole of the honorable member’s speech. He also said that I had dictatorial ambitions. He went on to say that I had made a milk-and-water statement in an attempt to appease the ex-servicemen - that I had thrown them a bone or a few crumbs in order to keep them and the people quiet. Let us consider the facts. When we found that in order to carry out our policy it would be necessary to restrict to some degree advances for war service homes, we said to the ex-servicemen, “ We are aware that this decision may entail on your part some temporary interim financing”. We did not want to hurt anybody. We realized that many applicants whose applications had been approved would expect help from, the War Service Homes Division. We realized that those who had already entered into commitments would also have to be protected. Having covered those two contingencies we realized that in spite of every care we took to avoid it some hardship might be discovered for which we had not planned.

As honorable members will recall, the Prime Minister (Mr. Menzies) said in this House and in subsequent statements to the press that we would protect in three different ways those whose requirements had to be temporarily deferred. Is that the milkandwater appeasement, the bone or the few crumbs to which the honorable member for Lalor has referred? Let us ascertain what was entailed. The commitments we had already entered into under these provisions, which we honoured, totalled £1,508,750. Applicants who had entered into contracts, and who might have lost their deposits if they were not covered, were protected to a total amount of £232,100. Cases of hardship were assisted to the tune of £200,500. Thus, the total assistance granted amounted to £1,941,350. That is real folding money and not a bone or a handful of crumbs to be offered in “ appeasement “. It is a very real measure of assistance.

I shall refer now to the last point that was made by the honorable member for Lalor because my reply to it can be most effectively stated at this stage. I have suggested, and I have backed up my suggestion with some evidence, that plain unvarnished untruths have been uttered or printed about this matter. Why should that be so? I have given information to the House; I have made statements over the air, and I have placed information in the hands of the press about this subject. Moreover, the Prime Minister himself has done likewise. Yet a mass of inconsistencies is being injected into the mind of the general public and of exservicemen. Why is that being done? The answer is perfectly clear. The facts are being twisted and perverted for purposes of party political propaganda. I readily acknowledge the gallant service that the honorable member for Lalor and other honorable members opposite rendered as members of our armed forces; but it is strange to see other persons who all their lives have taken little or no interest in the welfare of ex-servicemen suddenly, and for party political advantage, jumping on to the band wagon of the ex-servicemen.

I have said that the facts and figures in relation to war service homes have been misinterpreted and distorted. I shall remind the House of some of those hard, cold facts and figures because only to the degree that honorable members examine them will they be able to determine whether the Government has a good case in this matter. The War Service Homes Act was implemented in 1919, that is 33 years ago, but whereas in the 30 years up to the 1st January, 1950, just a few weeks before this Government assumed office, the number of houses that had been provided was 55,541, this Government, by the 30th June of this year, will have, provided no fewer than 37,000 war service homes during the two and a half years that it will have been in office. I emphasize those figures. The Government, since it assumed office approximately two and a half years ago has provided 40 per cent, of the total number of war service homes that have been provided since the act came into operation 33 years ago. During the first 30 years of that period, successive governments provided on an average 1,S00 homes a year, but during the two and a half years that this Government has been in office it has provided on an average, not 1,S00, 5,000 or even 10,000 homes a year, but well over 12,000 war service homes a year, or an increase in that average of over 700 per cent. Yet the Leader of the Opposition has submitted an amendment the effect of which is that the Government should do more than it is doing in the provision of war service homes. I again ask the House to realize that the most that honorable members opposite did in any one year when they were in office was to provide 6,000 war service homes for an expenditure of £8,000,000. That amount is only one-third of the sum that this Government is expending annually for this purpose, and the number of homes is less than one-third of those we have provided. During the 30 years prior to this Government assuming office, previous governments expended £53,000,000 in the provision of war service homes, yet this Government, which the Opposition now claims is not doing sufficient in this sphere, expended to the end of March last a total sum of £55,000,000 for that purpose and at the end of the current financial year will have expended £63,000,000 under that heading during the two and a half years that it will have been in office. 7n addition to the actual provision of war service homes the Government has also helped to provide housing for ex-servicemen under the Commonwealth and State housing agreement, which stipulates that 50 per cent, of houses that are provided under it for letting shall be made available to ex-service personnel. In respect of that agreement the Government has provided £26,000,000 in addition to the expenditure that it has incurred under the War Service Homes

Act. Having regard to those facts, the attitude that honorable members opposite now adopt reminds me of the well-known saying. “They say, they say; what they say let them say ‘”. I am impelled to try to reconcile what honorable members opposite now say with what they did when they were in office. The best, that Labour was able to do in any of the eight years that it was in power was to provide 6.000 war service homes at a cost of :£S,000,000. Yet, honorable members opposite now say that the Government should spend more than it is expending in the provisions of these homes which is three times better than the Labour Government’s record year. The Government’s record in this respect has not been excelled in the history of war service homes. It has an outstanding record not in words but in results, and no sensible person who is aware of the facts could fail to be convinced completely of the wisdom that it had exercised in achieving such a dramatic result.

Mr HAYLEN:
Parkes

.- The

Minister for Social Services (Mr. Townley) has unduly thrashed himself on this issue because I remind him that the criticism of the Government in this matter does not come entirely from this side of the House. The Minister has indulged in statistics to such a degree that he reminded me of Disraeli’s saying, “ There are lies, damned lies, and statistics “. The present Government has benefited immensely from the planning that was undertaken by the Curtin and Chifley Governments during the recent war and the years of reconstruction that followed it. Therefore, it is futile for the Minister merely to quote figures to prove certain things if in doing so he ignores that vital fact. Moreover, as we all know a great impetus has been given to the construction of houses as the result of the return to industry of service personnel. The Government has achieved, the record in respect of which the Minister has so proudly cited figures mainly on the basis of the planning that was undertaken by the Curtin and Chifley Governments. However, that is a side issue in this debate. The real point that we must consider is that when ex-servicemen are in dire need of housing and during a period when the housing shortage, is the most equisitely felt of all our difficulties, the Minister has decided to suspend the operation of the most useful provisions of the War Service Homes Act. As the honorbale member for Lalor (Mr. Pollard) has pointed out, there are two plans. Under the first plan, the ex-serviceman is required to obtain the consent of the War Service Homes Division, and then get a builder. A long time elapses before the house is completed and he is able to occupy it. The second plan, which certainly produces quicker results, has been availed of by a large number of ex-servicemen, and is the more popular of the two plans. This Government babbles about the virtues of free enterprise, and the right of the smart man to be quickly off the mark in order to get what he can for himself and his family; yet it has denied to ex-servicemen the right to obtain financial assistance from the War Service Homes Division for the purpose of purchasing existing properties. The argument may be advanced that it is preferable to construct new houses, but I emphasize that if a sufficient number of new houses cannot be erected to meet the requirements of ex-servicemen, the next best thing is to allow them to purchase existing properties. That view is shared by more than 33,000 ex-servicemen, who require homes for themselves and their families and whose names are on the books of the division with that intention.

The War Service Homes Division is eager to give ex-servicemen a fair deal. In this debate, it is not under criticism for what it has done in the past, or what it may do in the future. It is under criticism for having made a complete and dramatic change of plan without informing the persons most concerned about it. It is to the eternal credit of the honorable member for Lalor that this position has been exposed. He read and inwardly digested the seemingly inoffensive statement about the change, and recognized that there was considerably more in it than at first met the eye. When the amending legislation was before the House. we fought strenuously to ameliorate the position. How our efforts were frustrated is well known to the public. If any person considers that a LiberalAustralian Country party government treats ex-servicemen more generously than does a Labour government I beg him to read the records of Hansard, which show that we were gagged, “ guillotined “ and practically driven out of the House when we attempted to air this matter. Our efforts to discuss the matter were frustrated in those ways six months ago, and another opportunity to discuss it has not arisen before this evening.

I emphasize that two plans are under discussion. Under the first plan, a house is built slowly and tortuously. The ex-serviceman is obliged to wait for a long time before he is able to occupy it. Under the second plan, the exserviceman may be able to obtain a house immediately, provided he is given financial assistance by the War Service Homes Division. That plan was to be changed, and when we challenged the Government’s decision, the Minister accused us of insincerity. If we are insincere, some reports of statements that I propose to read may be classified in the same category. The position created by the Government became intolerable to many ex-servicemen on the other side of the chamber. At least two of them considered that the whole proposal was bad, and when they could not get any satisfaction at a party meeting or from Cabinet, they took the matter into their own hands. The honorable member for Bowman (Mr. McColm), who was a pilot in World War II., and is highly respected, said that the Government had broken its promise to ex-servicemen in the matter. The Sydney Daily Mirror of the 6th March last, published the following report: -

When the Cabinet decision was conveyed to Mr. McColm, he made the following comment-

Mr SPEAKER:

– Order ! The honorable gentleman may not refer to another honorable member by name.

Mr HAYLEN:

– I was reading a passage from a newspaper in which the name of the honorable member for Bowman occurred. The report attributed the following comment to the honorable gentleman : -

I find myself in complete disagreement with the Government’s decision. The Government has dishonoured its promise to returned servicemen.

The honorable member for Franklin (Mr. Falkinder) was. reported as having stated that he stood completely behind what the honorable member for Bowman said, and added -

I, too, will return to my electorate as soon as possible to discuss the decision with, my colleagues there.

I believe that the honorable member for Bowman and the honorable member for Franklin were completely honest in the matter, and that they were grievously disturbed by the Government’s decision. Any change of policy that has since been made is the result of the action that they took, almost to the point of resigning from the Liberal party, in addition to strenuous Labour opposition. It is all very well to boggle dates, and say that the second plan was not made on Tuesday but on Ash Wednesday, or on pancake day and not the day after Pontefract; but undoubtedly pressure was exercised by Government supporters, as well as by thu Opposition, to bring about the change. A serious case was made out against the Government in regard to its treatment of ex-servicemen. The position became so acute that ex-servicemen’s organizations felt grave concern. The President of the New South Wales branch of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia, Mr. Yeo said -

The Federal Government’s action in restricting the normal flow of finance for war service homes was inexcusable.

Every honorable gentleman knows that that restriction of the normal flow of finance became a major crisis in his own electorate. Government supporters arclaughing. Those men who pay lip service to the problems of ex-servicemen because they themselves happen to be exservicemen have no right to sneer at my remark. It is a major crisis for the man who, after having served his country in war-time, has no home for his wife and children. There is nothing to chortle about in my statement, which is basically factual. Lack of housing is a major crisis to the unfortunate ex-servicemen who have no homes for their families. It is an additional crisis when we realize that the War Service Homes Division itself has closed one of the Government’s escape hatches, because financial assistance will not be granted the ex-servicemen who desire to purchase existing dwellings.

It is all very well for the Minister to complain that we have misrepresented him, and made wild statements that cannot be substantiated. His difficulty is that he has spoken with two voices. The statement that is under consideration to-night, the amending legislation that was introduced last year, and his statements in the press have been at variance. When we examine this statement, the change of practice is obvious. The Minister accepted responsibility for ensuring that exservicemen would be granted loans. A few dayslater no loans were available. By the process of elimination and by pertinent questions addressed to the Minister, we ascertained that the Government considered that ex-servicemen should have newly constructed dwellings: it did not propose to grant loans of up to £2,000 to ex-servicemen to enable them to purchase existing properties. I think that the Minister will agree that I have given a fair summary of the series of statements made by him. So, in the circumstances, the Opposition took up the cudgels on behalf of ex-servicemen in order to show that the Government was doing a grievous thing. The position would not be so serious if houses were available for ex-servicemen to rent, so that they could provide shelter for their families, and, in the long run, could purchase houses by making repayments over a long term at a. reasonable rate of interest. But the position to-day is acute. The Commonwealth and State Housing Agreement provides for a percentage of newly constructed houses to be made available to ex-servicemen, but the system of war service homes is almost as old as federation itself. It began shortly after the conclusion of World War I., and has been most successful. Why, then, when the housing position is acute should the Government break down that practice by the injection of a new phraseology? The honorable member for Lalor has read the relevant sections of the act, and the amendments thereto. How can the House come to any conclusion other than that the Government has made a definite change of policy? Why was that change of policy hidden under so many words? Why has it been so hotly contested since ? Why have some Government supporters, including the honorable member for Bowman and the honorable member foi’ Franklin, persisted with their objections to the plan even after they were told things that we were not told about it? They remained dissatisfied, and considered that there was still an ugly smell of repudiation about it, particularly in respect of those men who had brought their applications to the point of signing with the commissioner on the dotted line.

There have been two serious faults which I hope will be rectified. The first is that there is no need to jettison the most successful part of the scheme because of long-range planning. The second is that .some notification should have been given of the fact that the money which had been provided for war service homes was running out so quickly. At present, there are 33,000 applications by exservicemen for houses, and every honorable member knows that ex-servicemen are completely dazed about the position. The whole process of obtaining a house is marked with frustration. The War Service Homes Division is obliged to wait, for a long time before it can get contractors to build houses. Some contractors have had contracts. Perhaps a “ rise and fall ‘’ clause has not been included in them or perhaps a contractor has foolishly taken a contract and practically absconded. The result is that uncompleted houses are dotted over the country. It is useless as a progressive building scheme, because it is too slow, and is in danger from many factors, including the fact that there is no black-market. A contractor who builds a house for an exserviceman has to be as “ fair dinkum “ as the ex-serviceman. There is no “ cop in it to use a colloquialism that is popular to-day. The second opportunity that an ex-serviceman had to own a home was to rely upon his own quickness to find a house that was available, have it valued by the war service homes authorities, and obtain the necessary money at a low rate of interest. I realize, of course, that the Treasury is behind many frustrations such as this. That was so when Labour was in office, and will be so for many years to come. The Treasury is quite unemotional, but it has the “bawbees “ and therefore has the final word. War service homes finance was running out quickly, and Treasury officials feared that the effect on the whole scheme would be dangerous. Therefore, they plumped for the long-range plan, with the disastrous results of which we are all aware. I am sure that the Minister means well. He has tried to do a good job, but he must realize that his predecessors, regardless of their political colour, also tried to do good jobs. This has never been a red hot political issue. I do not subscribe to the view that civilians are not entitled to criticize repatriation administration, and the more Government supporters who get up and tell the Minister where he gets off, the more I shall be pleased.

The whole issue arose out of a most cunningly worded few sentences in the Minister’s statement. Those sentences were capable of very wide application. The analysis of the Minister’s remarks made by the honorable member for Lalor brought home to Ministers something that they apparently did not know. In the present period of financial stringency, the serviceman is suffering perhaps more than the civilian in relation to housing at least, because he expected more of us. He finds that the Government has suddenly decided to jettison the better of two plans merely because some Treasury official has been unable to find a formula to meet the situation. We are entitled to resist the abandonment of what we regard to be the better plan, and we do resist it. We believe that the fight offered by honorable members opposite who believed that the Government’s action was wrong should have been carried further. When any one decides to .carry a fight to his own people he must be prepared to take it right out the back door. A political axiom is that no one should threaten to resign unless he is in fact prepared to resign. Honorable members opposite who criticized the Government, were, I am sure, completely honest, but apparently they paid too much heed to their colleagues who said, “ We are not taking this very seriously and you should not do so either “. Nevertheless, they rendered a good ser- vice to the whole community by drawing attention to the matter and dispelling the intolerable suggestion that, for exservicemen, only good things can come from a Liberal government. They have had to rise in this chamber and denounce something that they believed to be entirely wrong. We on this side of the chamber are still not satisfied that the new plan is good. We are told that when the flow of new money commences in June the demands of ex-servicemen will be met. In the meantime, the Minister finds himself in the same position as the Treasurer (Sir Arthur Fadden) in relation to finance. It is something over which he has no- control. By the time the new money becomes available there will be 40,000 applications for war service homes, and the finance will be quite inadequate. In the meantime, ex-servicemen will not know their fate. I believe that the Government should have let well alone.

Mr PEARCE:
Capricornia

.- To-night we have seen the spectacle of the Opposition in this chamber attempting to stone the Government for the good work that it has done. By accusation and innuendo, honorable members opposite have disparaged an administration that has proved itself capable of performing a task which they themselves were incapable of doing. I could not help feeling, however, that the remarks of both the honorable member for Lalor (Mr. Pollard.) and the honorable member for Parkes (Mr Haylen) were tinged with envy.

The honorable member for Parkes referred to certain actions of two of my colleagues and quoted newspaper reports concerning those actions. That is where the envy comes in so far as the honorable member for Parkes is concerned. I remind him of another axiom - “ People who live in glass houses should not throw stones “. He knows quite well that when Labour was in office he could not go outside the Parliament and criticize the then Government’s actions, because by so doing he would have been breaking a cast-iron rule of the Labour caucus, and would have been expelled from his party. Labour’s maximum annual provision for war service homes was something like £ 8.000,000, which was sufficient for only 6,000 houses. Compare that record with the provision by this Government of £27,000,000, or sufficient for 17,000 homes ! I am a fairly thorough reader of newspapers but I do not recall having read that either the honorable member for Lalor or the honorable member for Parkes said inside or outside this House that the Labour Government was not doing enough for ex-servicemen. They could not have done so without facing expulsion from the Australian Labour party. If they feel like throwing stones they should remember that they live in a very transparent house.

Mr Pollard:

– When Labour was in office, houses cost only a quarter of the present-day figure.

Mr PEARCE:

– The honorable member for Lalor spoke for twenty minutes in this debate, but said nothing worthwhile. Let us consider the basic facts. The Minister for Social Services (Mr. Townley) has told the House what has been done by the present Government in the” two and a. quarter years since its election. The honorable member for Lalor said that a loan of £2,000 was not enough, yet the very basis of this discussion to-night is the fact that £2,000 was so much that ex-servicemen used up in eight months the sum of money that had been allocated for twelve months. The honorable member for Lalor also said that the promise of relief in cases of hardship did not mean a thing. Let us see what was said on behalf of the Government when it was found that funds had been exhausted. On the 6th March the Prime Minister (Mr. Menzies) said -

Cabinet re-affirms its decision that £27,000,000 is not to be exceeded, except to such extent as may be involved in carrying out the following three administrative directions: -

1 ) All existing commitments will be completed.

I challenge any honorable member opposite to instance any then existing commitment, in any part of Australia, that was not completed. The right honorable gentleman continued -

  1. Where contracts have already been entered into prior to the 25th February by eligible ex-servicemen in anticipation of War Service Homes finance, and there will be a loss of deposit if the contract is not proceeded with, a commitment will be accepted by the division.

Again I challenge any honorable member opposite to show that that undertaking has not been honoured in full. The Prime Minister continued -

  1. Where specialcases are put forward in which great hardship will be suffered if the application is not dealt with, a commitment can, with the Minister’s approval, be accepted.

The honorable member for Lalor spoketonight with his tongue in his cheek. He knows full well that all special cases have been given sympathetic consideration by the Minister. In a speech lasting twenty minutes he made only half a point. Let us look in the matter in its proper perspective. Labour provided £8,000,000 to build 6,000 homes. This Government, in its very first year of office, was able to provide finance for 10,300 homes. In the 30 years before this Government took office in 1949, the average number of war service homes provided was 1,800. Yet in its first year of office, this Government raised the figure to 10,300! Lest anybody should believe that there was some truth in the statement by the honorable member for Parkes that this represented a carry-over from the administration of the Labour Government, let us consider the figure for the succeeding year. In that period, the figure was increased, not by a few per cent., but by 50 per cent. Under the regime of this Government, only eighteen months after it came to power, the War Service Homes Division provided 15,100 houses for exservicemen in a single year. By the end of June this year, finance will have been provided for an additional 17,000 war service homes. Of the total of87,000 houses provided by the War Service Homes Division in 33 years, 37,000, or 40 per cent., have been provided under the administration of this Government in the last two and a quarter years. No wonder the Opposition is green with envy !

But there may be a special explanation of its attitude to the provision of war service homes. Why did not the honorable member for Lalor and the honorable member for Parkes force the former Labour Government to do what they now urge this Government to do? The answer emerges clearly if we examine the Labour party’s policy. The truth is that it is against Labour’s policy for Australians to own their own homes.

Mr Duthie:

– That is not true.

Mr PEARCE:

– I repeat that it is against the policy of the Australian Labour party for Australians to own t heir homes. Labour may once have supported home-ownership but, since the Communists have infiltrated its ranks, its policy has been solidly and definitely that the State should own the houses and that the people should rent them. The truth may be found in volume 185 of Hansard for the 2nd October, 1945, at page 6265. On that page Hansard records that a Labour Minister, referring to the ownership of homes, said -

The Commonwealth Government … is not concerned with making the workers into little capitalists.

Mr Curtin:

– -The honorable member will not be back after the next election.

Mr PEARCE:

– The gentleman who made that utterance did not come back! I suspect that the reason why so few war service homes were provided for applicants during Labour’s period of office is to be found in the fact that Labour was not willing to let the people become home-owners and thus achieve what it regarded as the status of little capitalists. It is shocking to hear members of the Opposition criticize the Government for doing good work that they themselves could not, or would not, undertake when they were in office.

The figures are of such outstanding significance that I shall repeat them. Sometimes it is necessary to repeat facts in this chamber because it is hard to drum the truth into hard heads.Forty per cent. of all war service homes in Australia have been provided during the last two and a quarter years under the administration of this Government. Let us remember that! Previous governments took 30 years to build the other 60 per cent. They provided £63,000,000 for war service homes in that period. This Government has provided £53,000.000 in two and a quarter years. Its record on behalf of ex-servicemen is one of which it may well be proud and of which the Opposition may with justification be envious. It has honoured obligations which the Labour party has always shirked.

Motion (by Mr. Eric J. Harrison) put -

That the questionbe now put.

The House divided. (Mr. Speaker - Hon. A rchie Cameron.),

AYES: 57

NOES: 43

Majority . . . . 14

In division:

AYES

NOES

That the question be now put.

Question so resolved in the affirmative.

Question put -

That the words proposed to be added (Dr. Evatt’s amendment) be so added.

The House divided. (Mr. Speaker - Hon. Archie Cameron.)

AYES: 43

NOES: 55

Majority . . . . 12

AYES

NOES

Question so resolved in the negative.

Mr BIRD:
Batman

.- The Labour party’s interest in the housing of ex-servicemen is not motivated by desire for political aggrandisement or gain, but arises from its sympathy for exservicemen and other people who wish to become home-owners. Some honorable members opposite have claimed to-night that the policy of the Labour party is one of opposition to home ownership by individuals. That claim is definitely untrue, as the record of the Labour party when in office amply demonstrates. The Chifley Labour Government was responsible for the Commonwealth and State Housing Agreement which has enabled thousands of Australians to purchase their own homes on a hire-purchase basis. It was also responsible for financial arrangements through the Commonwealth Bank and the Loan Council which assisted people who aspired to home ownership. So it is patently absurd to suggest that the Labour party, which stands at all times for better conditions for the working class, would cut across its own avowed policy-

Mr SPEAKER:

– Order ! This debate is not on the policy of the Labour party but on the subject of war service homes.

Mr BIRD:

– That is so, Mr. Speaker, and I shall connect my remarks with that matter. The war service homes scheme has provided people who served their country in war with an opportunity to own their own homes. Because of that fact, the Labour party is prepared to support to the hilt any scheme, no matter what it may be called and no matter what section of the people it may serve, that has for its object the purchase of homes by the people. We were alarmed, and are still alarmed, by a statement made by the Minister for Social Services (Mr. Townley) when he introduced the War Service Homes Bill last year, and also by subsequent developments. I can say without fear of contradiction that members of the Opposition at least have been inundated over the last few months with complaints from ex-servicemen who are perturbed about developments in connexion with the Government’s policy on war service homes. The Government has stated that it proposes to discontinue the practice of taking over existing mortgages. T contend that that will be a retrograde step, because it will prevent many exservicemen from owning homes. Actual figures prove that, over the last four or five years, about one in six of the war service homes purchased through the War Service Homes Division have been taken over under the existing mortgage system. In other words, if the policy of taking over such mortgages is discontinued, about 16 or 17 per cent, of ex-servicemen who aspire to home ownership will be prevented from owning their own homes.

Government supporters have claimed that the Government’s record in making war service homes available to exservicemen is better than that of previous governments, and they have cited statistics rr, prove their contention. The explanation of the disparity between expenditure under this Government on the provision of war service homes and the expenditure under the Labour Government is perfectly simple. Between the two world wars there was only one Labour Government in. office, and its term lasted for only two years between 1929 and 1931. I t was in office eleven years after the end of hostilities in 1918, and there was then little demand for war service homes, the post-war demand for such homes having been met in the early 1920’s. Naturally, the end of World War II. brought a greater demand for war service homes than had been experienced previously, because about 500,000 Australians had served in that war and a considerable proportion of them naturally wished to become home-owners under the war service homes scheme. The honorable member for Capricornia (Mr. Pearce) made some frantic statements claiming that the Labour Government bad provided only £7,000.000 or £8,000,000 for war service homes compared with £27,000,000 provided by this Government. The fact is that the smaller amounts devoted by the

Labour Government to that object completely satisfied the then demand for war service homes. That amount of £7,000,000 or £8,000,000 achieved much more than a larger amount would achieve nowadays, because building costs were lower at that time than they now are. The proof of the adequacy of the Labour Government’s provision of war service homes is that, at the time when it was spending £7,000,000 or £8,000,000 for that purpose exservicemen were not complaining about the war service homes programme. But the amount of about, £2S,000.000 of which Government supporters boast is not satisfying the present demands of exservicemen.

The Labour party is concerned about the Government’s proposal to discontinue the practice of taking over existing mortgages. At a time when one of the main national problems is to house the people it is hard to understand why the Government should make it more difficult for ex-servicemen in particular to own their own homes. Do not let us forget that ex-servicemen were told during the war that on their return they would be given every consideration by a grateful country. The announcement that the Government would discontinue the taking over of existing mortgages, which was announced in the last hours of the last sessional period, came as a bolt from the blue to many ex-servicemen. The main pre-occupation of ex-servicemen who aspire to be home-owners is to push ahead quickly with the building of their homes before the costs of building material rise much further. They have arranged shortterm loans with banks or other financial institutions, to enable them to build homes that the War Service Homes Division .might later take over under the existing mortgages system. If the division is not to take over those short-term loans many ex-servicemen will be seriously embarrassed. The discontinuance of the system will certainly put an end to the proposals of many exservicemen to build homes with private finance. The rate of interest charged by the War Service Homes Division is 3$ per cent., but the rate of interest for private accommodation ranges from 3$ per cent, to 4f per cent. Over a period of 30 years the present system in respect of existing mortgages could save an exserviceman perhaps £200 or £300. But the Government intends to dishonour promises that have always been regarded by all previous governments as sacrosanct. If the Government continues with its proposal ex-servicemen will be forced to forfeit privileges that have been available to them since the war service homes scheme was begun after World War I.

Perhaps the Government has determined on its policy without sufficient thought because it did not realize fully the consequences of it. The operation of that policy will simply make home ownership the province of people who have sufficient means to withstand the onslaught of high costs of labour and builders’ rackets, because even under the present circumstances ex-servicemen are finding it particularly difficult to build their homes. If they are not to receive the support that they have received in the past, then the Government will stand condemned in the opinion of all thinking citizens whether they be members of the Labour party or the Liberal party, vihether they be ex-servicemen or not.

Mr McCOLM:
Bowman

.- It I- with a certain amount of regret that 1 rise to speak on this subject. At the end of the last session of this Parliament a certain amount of newspaper publicity was given to the honorable member for Franklin (Mr. Falkinder) and myself. I do not think that either of us has changed his views in the meantime. The only statement that we have made public on this subject has been that we believed that the Government had dishonoured a promise to ex-servicemen and that we felt so strongly about the matter that we were prepared to resign from our party. We proposed to return to our electorates and consult our branch members. The facts were placed before my branch members - some 160 of them - and they expressed the belief that it is my right to express in this Parliament those views which I sincerely hold and they requested me to remain within the Liberal party as their representative. In doing that they did me a great honour.

Mr SPEAKER:

– Order ! If honorable gentlemen on my left are not prepared to maintain order I am prepared to act.

Mr McCOLM:

– The Government’s achievements on behalf of returned servicemen in the provision of war service homes have been outstanding. Australia is third best, of all countries in the treatment of its ax-servicemen. Largely because of the necessity of the times, the Government has spent a considerable amount of money on war service homes but it has dishonoured a promise to returned servicemen by failing to assist those in a certain category to purchase homes.

It is a great pity that this debate was not held at the end of the last session when this matter would have been a more lively subject. The facts were then comparatively fresh in all our minds. I should like to state why I believe that the Government broke its promise. In the last budget £27,000,000 was allocated for expenditure in assisting returned servicemen.

Mr McMAHON:
LP

– £25,000,000 was allocated.

Mr McCOLM:

– Twenty-seven million pounds was the final figure. On the 28th February, when the Minister for Social Services (Mr. Townley) made his statement, that sum had not been spent. One portion of it had been used - the amount set aside for the purchase of existing dwellings. But the purpose of the act was to assist ex-servicemen to obtain homes, whether new houses or houses which had already been constructed. That purpose was not fulfilled. In spite of statements that have been made in the leading articles of reputable newspapers. I deny that the sum of £27,000,000 has been used for the purpose for which it was allocated. Unfortunately, I have been unable to find the exact figures relating to the expenditure of this money. I do not deny that an internal departmental allocation had been exceeded, but I do deny that the total amount available for the purchase of war service homes had been expended when the Minister made his statement, and I therefore disagree with him.

The Minister said that funds would be available from that amount of £27,000,000 in order to assist ex-servicemen in obtaining homes in four different classes. One of those classes was the purchase of existing dwellings. This assistance to ex-servicemen is not in the nature of charity and I do not think that the Government regards it in that way. The assistance has been given by virtue of a right which ex-servicemen have because they fought Cor Australia overseas, f am quite prepared for the whole war service homes scheme to be abandoned when every nian in Australia can be conscripted to fight wherever Australia needs him. But as long as a privileged number of people retain their right to remain inside Australia in time of war, the returned serviceman who has fought overseas should receive certain privileges when he returns.

T do not believe that the purchase of war service homes should be financed from money that has been allocated for that purpose in the budget. The amount should not be limited in that way. Despite the difficulties of raising loan moneys, I contend that if the Government attempted to raise a loan for the purpose of enabling ex-servicemen to obtain homes it would be over-subscribed in a very short time because the people of Australia realize that it is their responsibility to assist the returned servicemen. For that reason I believe that it would be possible to raise adequate finance in the form of loan moneys for this purpose.

T repeat the statement that I made mi the 6th March : I find myself in complete disagreement with the Government’s policy in spite of what the Minister has said to-night. I sincerely hope that when the Government’s finances for the forthcoming year are under discussion every consideration will be given to the possibility of obtaining money for war service homes by means of loans instead of providing for it in the budget. If that be not done, I shall oppose any measure that is aimed at limiting what I consider to be the rights of ex-servicemen to obtain assistance from the people of Australia through the Government. At present Australians are fighting in Korea and Malaya. We intend to send a squadron of the Royal Australian Air Force to the Mediterranean;, we have introduced national service training and we are seeking recruits for all our armed forces. A policy of restricting assistance to ex-servicemen for the purchase of homes will not help our recruiting campaign.

Mr THOMPSON:
It was quite refreshing to hear the honorable member for Bowman (Mr. McColm · Port Adelaide > [10.51].

deal with the subject of this debate on its merits and not from the standpoint of attempting to score off theOpposition. His attitude was quitedifferent from that of the honorable member for Capricornia (Mr. Pearce), whosaid that the Labour party was opposed tothe workers becoming little capitalists by owning their own homes. The honorable member did not charge any individual with that attitude, he charged the whole of the Labour party.

Mr ERIC J HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– He charged a one-time Labour Minister.

Mr THOMPSON:

– Yes, but he also charged the Labour party. The Australian Government can deal only with homes for ex-servicemen or government employees. The various State governments provide houses for the civilian population. I inform the honorable member for Capricornia that members of the Labour party are constantly fighting to secure adequate houses for all the people. I have had over 22 years’ experience in parliaments,, as a member of the Labour party, and throughout the whole of that time I havebeen fighting for funds to be made available for people who wish to own their own homes.

Mr ERIC J HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– The Labour party has not denied the charges reiterated by the honorable member for Capricornia.

Mr THOMPSON:

– It certainly does deny them. I raised this matter first in this House, by way of question, in February last. I asked a question about the curtailment of the supply of money for the purchasing by ex-servicemen of existing homes. In his reply, the Minister for Social Services (Mr. Townley) tried to mention the number of homes that had been built, but Mr. Speaker stopped him and told him that my question did not seek that information. The Minister spoke about 37,000 homes being built in the 30 years from 1919 to 1950. He should remember that during the whole of that period it was possible to build homes for ex-servicemen, and during the greater part of that time a nonLabour government was in. power. In 1930, when the Scullin Government held office, of course no money was available. I make this statement to the public as well as to this House, that never on any occasion has a Labour government refused to make available money to an ex-serviceman who applied under the terms of theWar Service Homes Act, and who was qualified under the act to receive if. The present Government is the first one so to refuse. There is nothing in the War Service Homes Act to prevent an ex-serviceman who is properly qualified under the act from receiving the money to which the act entitles him. The Government has moved away from that authority in the act, and is refusing what the ex-servicemen are justly entitled to under the terms of that legislation. In so doing the Government has made a big mistake.

The. Minister stated that with the exception of one or two ex-servicemen, honorable members on this side of the House were merely jumping on the band wagon by speaking about this matter. Many ex-servicemen in my electorate come to me to ask for advice and assistance in obtaining finance for homes. They do not ask me whether I am an ex-serviceman, they approach me as their parliamentary representative. We do not need to jump on the band wagon, because the majority of ex-servicemen are members and supporters of the Australian Labour party. The Returned Sailors, Soldiers and Airmen’s Imperial League ofAustralia is a non-political body, but we know that within the Labour party, and among its supporters, are the great majority of ex-servicemen.

Motion (by Mr. Eric J. Harrison) put -

That the question be now put.

The House divided. (Mr. Speaker - Hon. Archie Cameron.)

AYES: 55

NOES: 43

Majority . . . . 12

AYES

NOES

Question so resolved in the affirmative.

Original question resolved in the negative.

page 61

PAPERS

The following papers were presented : -

Air Force Act - Regulations - Statutory

Rules 1952, No. 14.

Banking Act- Regulations - Statutory Rules 1952, No. 15.

Broadcasting Act - Regulations - Statutory Rules 1952, No. 13.

Commonwealth Bank Act - Regulations - Statutory Rules 1952, No. 16.

Conciliation and Arbitration Act - Regulations - Statutory Rules 1952, No. 12.

Defence Act and Naval Defence Act - Regulations - Statutory Rules 1952, No. 17.

Defence (Transitional Provisions) Act -

National Security (Industrial Property)

Regulations - Orders - Inventions and designs (6).

Regulations - Statutory Rules 1952, No. 10.

Hospital Benefits Act - Regulations - Statutory Rules 1952, No. 11.

Lands Acquisition Act - Land acquired for -

Banking purposes - Melbourne, Victoria.

Defence purposes -

Amberley, Queensland.

Bullsbrook (Pearce Aerodrome), Western Australia.

Byford, Western Australia.

Dutson, Victoria.

Lara, Victoria.

Department of Civil Aviation purposes -

Benalla, Victoria.

Casino, New South Wales.

Cooktown, Queensland.

Postal purposes -

Bingara, New South Wales.

Bureen, New South Wales.

Glenorchy, Tasmania.

Lyrup, South Australia.

Noonbinna, New South Wales.

Ranceby, Victoria.

Ridgley West, Tasmania.

Salisbury, Queensland.

Smith port, Queensland.

Nau ru - Ordinances - 1 95 1 -

No. 6 - Lands (Validating).

No. 7 - Compulsory Education.

No. 9 - Capitation Tax Repeal (No. 2).

Public Service Act -

Ap poi n tme n ts - Departm e n t -

Air - J. P. Jost, B. G. Newman.

Army- T. W. N. Doreian.

Attorney-General - M. Bram.

Commerce and Agriculture - T. G. Fay. C. A. Hartmann-Smith, W. W. Stenning.

Health- R. C. Baddeley, P. M. Brown, G. G. Burniston, M. R. Hinton, D. O. Longmuir, G. E. Schwab, W. F. Tomlinson.

Interior - R. D. Johnston, P. E. Rayment.

Supply - J. E. Allan, H. C. Baghurst, C. H. Bain, W. S. Blake, D. J. Butler, A. G. Culvenor, B. H. S. Day, J. G. de Cure, T. S. Domaschenz, P. G. Duff. T. A. Finch. J. J. Frost, H. W. Calvin. P. J. Goggins, F. J. G. Graf, J. J. Hendry, T. A. Hennessy,R. F. Holland, J. D. Hutchison, E. W. Jensen, D. Jolly, J. L. Kerin, H. R. Limb, A. Lloyd, K. V. Lock, J. J. Miller, N. H. Morse, V. J. Norman, C.K. R. O’Donnell, J. G. Oswald, R. A. Piercy, A. D. Priest, D. P. Priestly, W. J. Rattray, J. W. Richards, E. S. Richardson, J. R. Rose. A. R. Scott, T. B. Smith, G. L.

Stephenson. J. G. Soutar, H. R. Tincknell, M. H. Toms, J. H. R. Towie, R. C. Wallace, W. C. J. White, D. C. Wilson, E. R. Wilson, A. E. Wright.

Trade and Customs - J. L. de Teliga, P. Matheson.

Works and Housing - F. P. Ashby, A. G. Bowrey, J. B. Crawford, D. B. Creevey, E. W. Foster, L. Griffiths, R. C. Ivery, R. C. Mallinson, A. R. McAlpin, L. A. Pocock, T. Ramsay, K. R. Stapleton, P. A. Thomas, W. F. Thrupp, G. S. Williams.

Regulations - Statutory Rules 1952, Nos. 9 19

SalesTax Assessment Acts (Nos. 1-9) -

Regulations - Statutory Rules 1952, No.18.

Seat of Government Acceptance Act and Seat ofGovernment (Administration) Act - Council of the Soil Conservation Service of the Australian Capital Territory - Fourth Annual Report and Statement of Receipts and Expenditure, for year 1950-51.

Superannuation Act - Regulations - Statutory Rules 1952, No. 20.

House adjourned at 11.4 p.m.

page 62

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Commonwealth Bank

Mr Ward:

d asked the Treasurer, upon notice -

  1. Is it a fact that the Commonwealth secured a site in Korumburra, Victoria, upon which it was intended to erect premises for the local branch of the Commonwealth Bank?
  2. If so, has the proposal been abandoned?
  3. If the proposal has been abandoned, will he state the reason for the decision?
Sir ARTHUR FADDEN:
MCPHERSON, QUEENSLAND · CP

– The answers to the honorable member’s questions are as follows : - 1, 2 and 3. I have been informed by the Commonwealth Bank that it purchased a property in Korumburra, Victoria, several years ago and that the alterations proposed have been postponed but not abandoned. At present the branch is housed in emergency premises.

Dollar Loan

Mr Bryson:

n asked the Treasurer, upon notice -

  1. What amount of dollars has been made available to newspaper interests for the purchase of newsprint since the present Government came to power?
  2. Has the amount of dollars made available for the purchase of newsprint been increased since the recent dollar loan was arranged?
  3. If so, what amount of these dollars was paid (a) from the loan, and (o) from current sales of Australian goods in the United States of America!
Sir Arthur Fadden:
CP

– The answers to the honorable member’s questions are as follows : -

  1. Since the present Government came into office dollar import licences have been issued for the following quantities of newsprint: - In the import licensing year beginning let April, 19S0, 10,000 tons; in the import licensing year beginning 1st April, 1051, 45,000 tons. Newsprint licences are authorized on a tonnage basis and precise values cannot be given because of the varying cost of the different grades and types of newsprint. However, for purposes of rough calculation, the average price of dollar newsprint may be taken us about £70 a ton.
  2. Sec answer to 1.
  3. No imports of newsprint have been financed under the 100,000,000 dollars loan from the International Bank for Reconstruction and Development. Accordingly, any payments for imports of newsprint against the licences issued by the Government have been financed through the banking system in the ordinary way from non-loan funds.

Taxation

Mr Johnson:
KALGOORLIE, WESTERN AUSTRALIA

n asked the Treasurer, upon notice -

  1. Will he state whether lie will consider a further extension for five or ten years of the 40 per cent, initial depreciation concession in respect of machinery used in primary production and developmental and other essential work which otherwise will- cease on the 30th June next?
  2. Would such ‘ an extension encourage primary producers to purchase essential machinery and enable them to play their full part in stepping up food production?
Sir Arthur Fadden:
CP

– The answers to the honorable member’s questions are as follows : -

  1. The Government has already considered this matter and, on the 28th March, 1952, the Prime Minister announced the following decisions: - (o) In respect of living accommodation for farm employees commenced on or after the 1st April next and before the 30th June, 1955, there will be a special taxation provision (i.e., a deduction for income tax purposes) for depreciation at the rate of 20 per cent, per annum for five years. There will be a condition that to secure the benefit of this concession buildings commenced but not completed as at the 30th June, 1955, must be completed during the financial year 1955-56. There will be a further condition that any accommodation so built for an employee shall have the benefit of the special depreciation up to a cost nf £2,000. ( 6 ) In respect of farm implements, buildings for fodder conservation, and irrigation materials such as piping, there will be for a similar period a similar special depreciation allowance of 20 per cent, per annum. Since these decisions were announced the Government has decided that the special taxation provision for depreciation at the rate of 20 per cent, per annum should apply as from the 30th June, 1951, in lieu of the 1st April, 1952.
  2. The special depreciation allowance is one of the measures designed by the Government to encourage increased food production.
Mr Clark:
DARLING, NEW SOUTH WALES

k asked the Treasurer, upon notice -

  1. What was the total amount paid to wool brokers for their services in returning to woolgrowers the money collected for the proposed wool stabilization fund? 2, What was the amount paid to each broker ?
Mr Morgan:

n asked the Minister representing the Minister for National Development -

  1. Is it a fact that the Vandykes prefabricating works at Villawood, New South Wales, have dismissed the majority of their employees and may have to close down entirely?
  2. Is this position the result of Government financial policy and restriction of credit?
  3. Will he take steps to ensure that this important Australian industry will obtain orders for defence and government instrumentalities’ requirements of prefabricated buildings which would otherwise be imported?

page 63

WOOL

Sir Arthur Fadden:
CP

– The answers to the honorable member’s questions are as follows : -

  1. The Australian Wool Realization Commission estimates that cost of using the services of wool-selling brokers in returning the Ti per cent, contributory charge to woolgrowers will be about £23,000 in respect of approximately 150,000 separate refunds. Final settlement has yet to be made in the case of some brokers.
  2. The commission advises that the services of 58 were used and that on. an average each broker received about £400.

Industrial Development.

Mr Casey:
LP

– The answers to the honorable member’s questions are as follows : -

  1. I understand that there have been some retrenchments at the prefabricating factory referred to. I am not aware of any intention by the firm to close its works down entirely.
  2. I understand the reduction in staff followed the cancellation of orders lodged with the firm by the New South Wales Housing Commission.
  3. The Department of Works and Housing is now negotiating with Vandyke Brothers for the supply of prefabricated hutments for the Commonwealth’s purposes.

Cite as: Australia, House of Representatives, Debates, 6 May 1952, viewed 22 October 2017, <http://historichansard.net/hofreps/1952/19520506_reps_20_217/>.

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