House of Representatives
23 September 1953

20th Parliament · 1st Session

Mr. Speaker (Hon. Archie Cameron) took the chair at 2.30 p.m., and read prayers.

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– Is the Minister for Labour and National Service aware that, in the course of his budget speech last evening-


– Order ! Is the honorable member’s reference to a speech made in this chamber last evening?


– No, I am referring to proceedings in the Legislative Assembly of New South Wales.


– Very well ! “


– The Premier of New South Wales spoke of local conditions, and said -

By world standards, our level ‘ of employment, our production and our living standards ure very high.

Does the Minister find this opinion in strange conflict with the attitude of Opposition members in this House who are still crying fear of depression and unemployment? Can the Minister inform the House whether unemployment figures support the statement made by the Premier of New South Wales?

Minister for Immigration · HIGGINS, VICTORIA · LP

– Like the honorable member for Mitchell, I read the statement by the Premier of New South Wales with great interest, the more so as it followed closely upon statements by this Government about the soundness of the economic position of Australia, and opinions expressed officially on behalf of the trade unions recently before the Commonwealth Arbitration Court. It would appear that there is general agreement in responsible circles that economic conditions in Australia to-day are remarkably bouyant, that our level of employment is high by world standards, and that demand generally is well sustained. The honorable member for Mitchell has also asked me whether unemployment figures support the statement by the Premier of New South Wales. An examination of the latest figures in relation to the payment of the unemployment benefit reveal a pro gressive decline in the relatively small volume of unemployment in New -South Wales. Approximately 25,000 persons were in receipt of the unemployment benefit in the first week of January last, and that number progressively declined in the interval to 11,000 last week. The House generally will be interested to know that the latest figures show a further reduction of 1,111 persons in receipt of the unemployment benefit. Of that number, a reduction of 730 occurred in New South Wales.

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– My question is addressed to the Minister for Commerce and Agriculture and I point out, by way of explanation, that in the past, Tasmania has produced 85 per cent.’ of the small fruits crop of Australia. In view of the gradual extinction of this industry because our small fruits are being priced out of the world’s markets, I should like to know whether the Minister has power to assist this industry through the medium of his department, either by way of a subsidy, or a search for markets at home and abroad? I may add that approximately 500 farmers are engaged in this industry, but scores of them are going out of production.

Minister for Commerce and Agriculture · MURRAY, VICTORIA · CP

– I am fully conscious of the problems of the small fruits industry of Tasmania, and the Government has been active in trying to help the industry, to which it attaches considerable value. A government instrumentality, the Fruit Industry .Sugar Concession Committee, made a substantial financial contribution to the small fruit-growers last year. According to my memory, the amount was £50,000. More recently, largely as a result of the representations of the honorable member for Franklin, who has been unceasing in his advocacy to the Government of the interests of these primary producers, the Government made a grant of £100,000 for the assistance of the industry. There can be no permanent stability for any industry that becomes entirely dependent upon government subsidies. Government agencies have been endeavouring to assist the industry with advice, a search for new markets and a search for different methods of presenting its products. That work will be continued. I assure the honorable member for Wilmot, as I have already assured the honorable member for Franklin, that the Government will do anything that is within its power to assist the small fruits industry. However, the basic problem is not peculiar to that industry. It is the problem that arises from the fact that costs have lost their relationship to world values. The final solution is to be found in the working out of the Government’s general economic policy, which is designed to reduce costs in Australia and bring stability to all industries.

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– The question that I direct to the Minister for Labour and National Service arises from the fact that the Victorian Government has introduced into the State Parliament a bill entitled the Long Service Bill, which is designed to give leave to workers after twenty years of continuous service. Is this measure likely to affect industrial policy in other States, particularly amongst employees who work under federal awards?


– The Victorian Government does propose, I understand, to introduce legislation of the character mentioned by the honorable member. That legislation cannot, of itself, affect the operation of federal awards. However, it cannot, fail to influence the attitude of tribunals that are required to deal with federal awards covering employees who work side by aide with employees in Victoria who work under State awards. I merely comment at this stage that the approach contemplated by the Victorian Government seems to be extraordinarily inconsistent with the repeated professions by Labour governments of their support for the system of arbitration. Quite clearly, the system of arbitration cannot function satisfactorily if, in the upshot, governments legislate to obtain the results that they desire when it suits them to do so and leave other industrial matters to the tribunals. Such a process cannot fail to embarrass the general system of arbitration, which ail political parties in Australia profess to support.

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– Can the PostmasterGeneral say when tenders will be invited for the erection of a building at Nyngan to house carrier wave equipment for the extension and improvement of telephone services in the far west of New South Wales? Can the honorable gentleman indicate when the erection of the building will be completed, and will he take action to expedite the work?

Postmaster-General · RICHMOND, NEW SOUTH WALES · CP

– We regard works of the kind to which the honorable member has referred as being of great importance in country districts. Carrier wave equipment picks up and boosts weak signals on the telegraph and telephone systems, and enables us to provide better services for country people generally. I understand that tenders for the erection of the building in Nyngan will be called early in the New Year, and that the work will be completed by about next September.


– Will the PostmasterGeneral reconsider the question of the destruction and sale of the telephone line at Portland-road in view of the importance of this road from a defence point of view in war-time and as an amenity to the outback areas in peace-time? The repair of the line and the establishment of a telegraph office at Portland-road would be of immense importance in the opening up of the north. In considering the matter, will the Postmaster-General take into consideration the fact that the Queensland Government proposes to build a steel smelter at Bowen, and that iron ore for the project will be drawn from Iron Range, resulting in an increase of population in the area?


– I have no personal knowledge of the matter to which the honorable member has referred.- I shall arrange for his suggestions to be carefully examined by the officers of my department.

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– In view of the importance of the Suez Canal Zone to Australia, will the Prime Minister say whether he is able to confirm reports that agreement has been reached between the United Kingdom and Egypt in relation to this area? If such an agreement has been reached, can he inform the House of the details of it?

Prime Minister · KOOYONG, VICTORIA · LP

– I cannot confirm the report to which the honorable member has referred. I have not received tin official communication on the matter. When I am in possession of official information, I shall be very happy to make it known to the House.

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– Has the Prime Minister been requested to seek an amendment of the Public Service Act with a view to removing an anomaly caused by a conflict between section 46 of that act and the Superannuation Act, as a result of which an officer who has been retired through invalidity, but subsequently recovers his health sufficiently to enable hi iti to return to work in the Public Service, is prevented from doing so? If the Prime Minister has no knowledge of this matter, will he say whether the Government intends to propose the amendment in any way of any section of either of those acts during the current parliamentary session?


– I am not quite clear about the point raised by the honorable member, but I will find out at once what the position is and will advise him a c.c-o reldingly to-morrow.

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BUDGET 1953-54


– Has the attention of the Prime Minister been directed to a statement in the budget speech of the Premier and Treasurer of New South Wales? It is as follows: -

We have chosen to budget for a deficiency rather than to reduce services. The recent Commonwealth budget, however, has reduced the very high level of direct and indirect taxation which was restricting initiative and hampering production, and our Government feels that the full effect of the Commonwealth budget should not be offset by any measures which would reduce the purchasing power of the people.

Will the right honorable gentleman inform the House whether the assessment of the beneficial effects of the Commonwealth budget made by the Premier and Treasurer of New South Wales is correct, or whether we should accept the contrary view expressed in this Parliament by the Leader of the Opposition and his followers, especially the honorable member for Eden-Monaro?


– I read with great interest the statement made by the Premier of New South Wales on this point. Of course, I entirely agree with him, just as I entirely agree with what was said by the trade unions in a statement that I quoted to the House recently. Those statements show quite plainly that honorable gentlemen opposite are now a minority movement, even in their own party.

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– Will the Minister acting for the Minister for Health say whether it is a fact that when members of some medical benefits associations approved under the Commonwealth national health scheme pay accounts rendered to them by their doctors and. forward the receipted accounts to the associations for payment of part of the charges, they are compelled to wait an inordinate period before they receive payment? if that be so, will the honorable gentleman issue an instruction that such payments must be expedited in order that no unnecessary hardship will be inflicted upon the people concerned?

Minister for Social Services · DENISON, TASMANIA · LP

– Everything possible is done by the Department of Health to ensure that such payments will be made as quickly as possible, but it is obvious that delays will occur in the initial stages of a scheme like the national health scheme. I assure the honorable member that we are doing everything we can do to make the waiting period in this connexion as short as possible. If he has a specific instance in mind. I shall be very pleased to inquire into it, if he wishes me to do so.

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– I ask the Minister for Air whether the Royal Australian Air Force intends to establish a bombing range in the area of the You Yangs? If so, what is the intended location, and what area is involved? Is it intended to locate any other Royal Australian Air Force establishment in the area, and, if so, what are the location of the area, involved and. the nature of the intended establishment? What is the present position in regard to any such arrangements ?

Minister for Air · LOWE, NEW SOUTH WALES · LP

– The Royal Australian Air Force does not intend to establish a bombing range in the You Yangs area. At present it is investigating the possibility of establishing an explosives supply dump somewhere in that area. The Commonwealth is negotiating with the Victorian Minister for Lands to establish the exact site of that supply depot. Probably the main problem that is worrying the honorable member is that if the Australian Air Board takes over an area in the You Yangs it might interfere with the pleasure of hikers and other people. I have been informed, however, that the maximum precautions have been taken to ensure that that possibility is avoided.

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– Will the Minister for Immigration say whether the Government is garnisheeing the wages of new Australians to recover the cost of board incurred by them while they were out of work but still under contract to the Government? If so, does the Minister know that an amount of £6 a fortnight is being deducted by Broken Hill Proprietary Company Limited from the wages of such new Australians who have wives and children to support? Does the Minister also know that this practice applies to men who have as many as six children? If he knows this, does he consider that the deductions are fair ? Will he also explain why these men were allowed to be out of work while under contract, and at the same time to accumulate debts for board? Will the Minister give directions that no garnishee should be allowed to operate if it would leave a married man with a wife and family to support with less than the basic wage to live on?


– I am not able to give a detailed reply to the points that the honorable gentleman has raised, but I shall see that such a reply is given to him as soon as possible.

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– Will you, Mr. Speaker, arrange for the films held in the National Film Laboratory to be reviewed, with a view to the elimination of films made many years ago by Ministers of the previous Government which, besides being badly produced, do not represent the views of the present Government and should not therefore be shown abroad?


– I shall look into the matter and advise the honorable gentleman later.

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– Can the Minister for the Navy advise me of the exact position at present regarding a large scale resumption of property to provide a huge city base in Sydney for the Royal Australian Navy? Can the Minister also advise me of the number of families who will lose their places of residence as a result of such a resumption? Will he ensure that no family is evicted without suitable alternative accommodation being made available to it? I have discussed, this matter with the Minister by means of correspondence.


– During the life of the last Government a special committee examined the question of resuming land in the Woolloomooloo area of New South Wales for the establishment of a naval supply depot. It found what was regarded as possibly the worst slum area in Australia, and decided that that area should be resumed. After several investigations the Chifley Government endorsed that policy. This Government has taken no part in the resumptions. I have inspected the area, and I confirm the opinion of the Chifley Government that it is a disgrace to Sydney and should be pulled down as quickly as possible. I have already informed the honorable member that it is not at present intended to evict any tenants. Consequently, the provision of alternative accommodation does not arise. If it should arise, the honorable member can rest assured that the Government will, as always, take the maximum precautions to see that the rights of individuals are preserved. If the previous Government had taken much the same action this problem would not have arisen. I offer to show the honorable gentleman the area concerned. I am convinced, knowing him as I do, that if he saw that area he would approve the decision of the Chifley Government and applaud whatever action this Government may take.

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– Is the Minister for Commerce and Agriculture aware that a new source of supply of sulphur has hecome available in Great Britain, because a sulphur recovery plant has been installed in an oil company’s refinery near Southampton? In view of the paramount importance of sulphur to Australia, particularly because of its value in the production of superphosphate for our agricultural industries, and because in the post-war years it has been difficult to obtain all the sulphur that we require, and then, substantially only from dollar sources,, will the Minister investigate the possibility of obtaining some of Australia’s requirements from the new source of supply in Great Britain? Will he also investigate the possibilities of inducing the companies that are now erecting oil refineries in Australia to establish in their plants sulphur recovery units similar to that at Southampton?


– The Government is conscious of the importance of superphosphate to the Australian agricultural economy, and of the relationship of sulphur or sulphuric acid to its production. We have done a great deal to make this country independent of imported supplies of sulphur. My colleague, the Minister for Defence Production, administers the Government’s activities in regard to sulphuric acid, and I am quite sure, f rom the discussions that I have had with him, that we shall lose no opportunity of inspiring private enterprise to ensure that every source of sulphur, or sulphur alternative, is conserved in this country for our requirements of superphosphate.

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– I ask the Minister for Social Services whether he is considering the position of pensioners who are inmates of institutions? I understand that in such cases the pension is allocated partly to the institution and partly to the pensioner, and I believe that when the pension has been adjusted in the past the total amount of the increase has been allotted to the institution and the portion granted to the pensioner has remained stationary at £61 a year. When the pension is next increased, will it be possible for the increases to be paid to the pensioners themselves?


– Some of the honorable member’s statements are not quite correct. For many years it has been the practice of all governments to allocate part of the pension to the pensioner and part to the benevolent home in which the pensioner is living. The proportion of the allotment is about 65 per cent, and 35 per cent. There is no intention to depart from that procedure this year.


– My question is directed to the Leader of the Opposition. Has the right honorable gentleman yet estimated the annual cost to the revenue if the social service reforms suggested by him on behalf of the Opposition should be carried out?


– I cannot say “ Yes “ to the honorable member’s question, because I have not yet worked out the precise figures. However, I am satisfied about the financial possibility of everything that I said in my speech, and I adhere to” my statement.


– In view of the fact that the Leader of the Opposition has not worked out the cost of the proposals which he made in his budget speech for increasing-


-Order! Reference may not be made in the House to debates which have taken place in the committee.


– Has the Minister estimated the cost of the proposals to which I have referred?


– Yes; I made a rough calculation of the cost involved in the implementation of the proposals made by the Leader of the Opposition. Without a means test, they would cost approximately £72,000,000. The calculation of the cost is easy; the big problem would be to find the money.

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– Is the Minister for Commerce and Agriculture aware of the lack of professional personnel in the “field of agriculture? If so, in view of the importance of primary industry to the future development of Australia, will the Minister advise whether any action will be taken to encourage young men to embark on university courses in agricultural science ?


– I am aware that there is a very real problem in the field to which the honorable member has referred. As the result of discussions that I have had with the permanent head of the Department of Commerce and Agriculture, who is himself acutely aware of the situation, the position has been brought very clearly before all the State governments through the agency of the Australian Agricultural Council. It has been discussed by the permanent heads of the State Departments of Agriculture at meetings of the Standing Committee on Agriculture. The academic course of training to which the honorable member has referred is provided by the State universities, which function under the administrative jurisdiction of the State governments. To the degree that it is possible for the Commonwealth, in its sphere, to encourage greater numbers of young men to take the course, or to assist them in so doing, we are already active and we shall continue to be active.


– My question to the Minister for Commerce and Agriculture arises from a question that was addressed to him yesterday. Can he give the House any information about the agricultural extension services sponsored by his department?


– Agricultural extension services are an exclusive function of State governments, but this Government, in its anxiety to increase the production of national wealth, has volunteered to make funds available in order to add to the activities of State extension services. The Commonwealth does not conduct any extension servicesof its own. The Government has made available £250,000 a year for a period of five years for extension services in connexion with the dairying industry, in order to try to increase its efficiency, and has extended over a period of ten years, and has vastly increased the amount granted to State governments for extension services to increase the efficiency of the tobacco industry. In a general sense, this Government has made available over five years a minimum amount of £200,000 per annum to add to the extension services conducted by State governments.

The Government has also indicated its willingness progressively to increase that amount to £500,000 a year if the States will increase their own expenditure on this work, not on a pro rata basis, but in a manner acceptable to the Commonwealth, and if the primary industries themselves will also make a contribution to these activities. I am gratified to be able to report that State governments and the great organized primary industries are re-acting favorably to that offer, and there is every prospect that, arising from it, the Commonwealth will be expending nearly £1,000,000 a year by aiding State activities in extension services. I mention those facts so that honorable members and the public may know that a vast amount of the work that is being done in this field under State administration is made possible by Commonwealth money that is freely given, and generally on the initiative of the Commonwealth itself.

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– I address my question to the Prime Minister. Has the Australian Government been consulted by the Government of the United Kingdom with regard to the United Kingdom joining the iron and steel community inaugurated as the result of the Schuman plan, and integrating its forces, or some of them, into the European Army, or becoming a full member of the European Union or European Defence Community? As it has been reported that the United Kingdom has refused to take such action on the ground that its membership of the British Commonwealth of Nations precludes it from so doing, will the Prime Minister state whether the Australian Government has any objection to the British Government joining any such organization ?


– The whole question raised by the honorable member of the suggested conflict between membership of the British Commonwealth and some European community is one of immense importance. Now that the honorable member has directed my attention to the need for it, I should like to take the opportunity to prepare a considered statement on the matter. I shall read it to the House at a convenient time.

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– Is the Minister for Civil Aviation aware that the Government of New Zealand has publicly announced, through the Prime Minister of that dominion, that New Zealand National Airways, which, he stated, are now showing a profit, are for sale, and that he would be glad to receive an offer for New Zealand’s share in the British Commonwealth Pacific Airlines and Tasman Empire Airways Limited, which are conducted jointly by Australia, New Zealand and the United Kingdom? If the Minister is aware of this statement, can he say whether the Australian Government, which owns a 50 per cent, share of B.C.P.A. and a 30 per cent, share of T.E.A.L. intends to make an offer to purchase any or all of New Zealand’s shares in those airlines? If the matter has not already been considered by the Government, will the Minister undertake to bring it before Cabinet with a view to purchasing these air services, two of which are international or “ flag “ airlines, and thus preventing them from falling into the hands of shipping or other interests?


– The honorable member for Maribyrnong has referred to only a part of the statement made by the Prime Minister of New Zealand. He omitted to mention the reference to the fact that New Zealand National Airways had been losing £320,000 a year, and that the Prime Minister of New Zealand said that he could not understand why people were reluctant to buy a business which was only losing that sum. The Prime Minister proceeded to state that, for his part, the airline was for sale, and that New Zealand’s interests in T.E.A.L. and B.C.P.A. would be disposed of by the Government, if it could do so. Negotiations have been in train over the last twelve months between the Australian, New Zealand and United Kingdom Governments for the re-organization of their various holdings in T.E.A.L. and B.C.P.A. Those negotiations are still proceeding.

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– Last week, the Minister for Supply was asked questions about the price which Australia has been receiving for its uranium. Can the Minister state whether it would be in the best interests of Australia for this price to be disclosed ?

Minister for Supply · PARRAMATTA, NEW SOUTH WALES · LP

– I answered a question by the honorable member for East Sydney, and a supplementary question by the Leader of the Opposition on this matter last week. The subject arose as the result of a statement by Lord Bracken in London some days ago,’ in which His Lordship, purporting to quote the price which Australia was obtaining for uranium, said that we were selling it at bargain prices.

Mr Ward:

– Hear, hear !


– All I can say is that His Lordship was very badly informed on the matter.

Mr Ward:

– No, he is right on the beam. ‘

Mr Menzies:

– This is the first time that “Ward has ever agreed with a lord.


– Lord Bracken was seriously misinformed, because the figures which he quoted of the prices which we were obtaining were completely wrong. In addition, when he said that we were selling uranium at bargain prices, he was again completely wrong. We are selling the uranium” at very satisfactory prices indeed.

Mr Ward:

– What are the prices?


– A section of the press, and the honorable member for East Sydney now say that we should reveal the prices. To do so would be to break faith with Great Britain and the United States of America and also betray Australia’s vital interests-

Mr Ward:

– Rubbish !


– The only uranium that we are selling is to Great Britain and the United States of America, and the governments of those two countries have specifically asked us not to reveal the prices. The reason for that request i3 perfectly clear. There are people elsewhere in the world who would dearly like to know the amount and the grade of uranium which we are selling to the United. States” of America and Great Britain for defence purposes. If the prices are revealed-

Mr Keon:

– Does not the Minister think that those people elsewhere in the world know the prices already?


– If those prices are revealed those persons would be able to use them in conjunction with other facts, which are known or can be ascertained, to work out the amount and the grade of uranium.

Mr Keon:

– Are they not able to do so already?

Mr Menzies:

– I thought that the honorable member was anti-Communist.

Mr Curtin:

– What is the need for all the secrecy?


– Order ! The honorable member for Watson (Mr. Curtin) has not asked the question, and is not entitled to interject when the Minister is giving his reply.


– We have been expressly asked by our friends not to reveal the prices, for the reasons that I have mentioned, and notwithstanding some peculiar gentleman opposite, we propose to keep faith with our friends.

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– In view of the statement by the Prime Minister yesterday that this Government seeks to encourage home ownership, can the honorable gentleman say whether he proposes to ease the conditions under which tenants of the Government in Canberra may purchase homes by ensuring that the deposit required will in no case exceed 10 per cent, of the valuation of the house ? Has the Minister had under consideration a suggestion from the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia that houses in Canberra should be sold without the payment of a deposit ?


– The answer to the last question is, “Yes”. The answer to the other question is that the proposal has been under consideration but that the basis on which houses are to be sold in Canberra is intimately associated with the basis on which houses are sold under the Commonwealth and States housing agreements. What one might be able to do in Canberra because of certain peculiar circumstances in this somewhat peculiarly administered city cannot be done in other places. Therefore, the housing problem of Canberra cannot be divorced from the agreements.

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– I ask the Prime Minister whether the Government’s decision to abolish entertainments tax was made in order to open that field of taxation to the State governments or in order to raise the living standards of the lower income groups by allowing them to enjoy cheaper entertainment. Can the right honorable gentleman say whether the possibility of the States reimposing entertainments tax was taken into consideration when the amounts of tax reimbursements to the States for the current year were fixed?


– As was indicated when the Government’s intention to abolish the entertainments tax was announced, we made the decision because we knew that this tax was paid by the great mass of the people. The Government regarded its abolition, therefore, as a means of providing a real addition to the spending capacity of the great mass of the people. It is a luxury tax in one sense, but it falls, not on a few people, but on millions of people. We considered the matter in the light of that fact. The pro=posal to abolish entertainments tax was not taken into account when tax reimbursements to the States were agreed upon, because it had not been discussed or determined by Cabinet at that time.

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– I ask the Minister for Labour and National Service whether there has been any improvement of the rate of loading and shipping steel from the ports of Newcastle and Port Kembla, and whether the back lag has been reduced.


– There has been, over a period, a considerable improvement of’ the volume of steel shipped from the steel ports. I have here the figures for Port Kembla, but not those for Newcastle. I think they will indicate fairly accurately the state of affairs at Newcastle. A total of 21,000 tons of steel was shipped from

Port Kembla in April, 1952. The quantity increased progressively to 34,000 tons in November, 1952, and 65,000 tons in June last. That reveals a satisfactory improvement of both the supply of steel and the rate of handling of cargoes and the availability of ships. I have reason to believe that a similar improvement has occurred at Newcastle.

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– I ask the Prime Minister whether the attention of the Government has been drawn to the International Architectural Convention and the Exhibition of Architecture and Building, which are being organized by the Royal Australian Institute of Architects and which will take place in Sydney in May, 1954? Will the right honorable gentleman, as acting Minister for External Affairs, examine the excellent opportunity which this convention will provide to advance the aims of the Colombo plan by bringing to this country representative achitects from Colombo plan countries who, by reason of the similarity of their problems and our problems, and our common need to advance our architectural standards, will not only have much to learn here but also much to contribute?


– I shallbe very glad to give consideration to the suggestion made by the honorable member.

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– I desire to ask the Prime Minister a question similar to that which he refused to answer yesterday. Does the Government intend to conduct any form of inquiry into the opening of a government department on a. Sunday to consider an application directed to the Capital Issues Board? Is the Prime Minister able to state whether, in this matter, action was taken by the Commonwealth Actuary on his own initiative, or was he acting under direction? Will the right honorable gentleman also state whether it is a fact that the only Ministers who can issue a direction to the Commonwealth Actuary are the Treasurer and. himself? Finally, will he furnish the names of the members of the Cabinet who were in Canberra during that particular week-end?


– The honorable member for East Sydney will be delighted to know that the litigation in question apparently having been dealt with by a judgment yesterday and the learned judge having referred to the date on this document and having unhesitatingly accepted the proposition that it was not falsified by design, the Treasurer will seek leave this afternoon, which I am sure the honorable member will grant him, to make a statement on this matter. Whether the honorable member will obtain any satisfaction from the statement is another matter.


Treasurer · McPhersonTreasurer · CP

by leave - I have received the following report from Mr. W. C. Balmford, chairman of the Capital Issues Board : -

Thursday,6th August : Mr. Schapel rang me at home to say Mr. Packer wanted to see me urgently at the week-end. He indicated that Mr. Packer would come to my house, butI said that could be misunderstood and that I would see him at the office.

Mr. Schapel, of course, is the Canberra representative of the Sydney Daily Telegraph, and Mr. Packer is the managing director of that organization. The report continues -

Thursday night or Friday morning: Mr. Scliapel rang to say that Mr. Packer could not come but that a Mr. MacDonnell would arrive about 4 o’clock on Friday afternoon.

Friday,7th August: Mr. Schapel rang at 4 o’clock to say the special charter plane had been delayed. Mr. MacDonnell actually arrived about 5 o’clock. He reminded me that he had met me once before and that was on the occasion of Sunday the 21st August, 1949, when at Mr. Chifley’s request, I saw four people about Courtauld’s Capital Issues application. On at least two occasions during that interview, I had to break off and go to see Mr. Chifley in his bedroom at the Hotel Kurrajong. MacDonnell told me that the Consolidated Press wished to buy a business. He said his instructions were to tell me everything I wanted to know but he did not wish to tell me which business was to be acquired unless 1 asked him to do so. He later said that the business was obviously a newspaper and that he might as well refer to it as such. At the end of the discussions, I said -

The newspaper was obviouslya Sydney evening paper.

I saw no reason why consent should be refused.

How urgent was the matter.

He replied that he wanted consent immediately because their programme was as follows: -

To approach a Director of the other paper the next day ( Saturday ) .

He knew the directors of the other newspapers would have a Board Meeting on Tuesday and be able to consider the offer at that meeting.

He hoped to be able to announce the completion of the arrangements on Thursday.

In reply I said I needed time to think the matter over; at any rate, to have an opportunity of discussing it with some one else. I therefore ‘phoned Dr. Wilson and took Mr. MacDonnell over to the Daily Telegraph office at Parliament House. I then went to see Dr. Wilson (this was after 6 p.m.) and give him an outline of the proposals. I told him I was satisfied that we should approve and was willing to accept the responsibility for approval.

We decided -

There was no reason to refuse the application.

We would probably have approved it 2 years ago when Capital Issues was being most stringently administered.

Application should be approved without reference to the Treasurer.

I then went back to Parliament House and told Mr. MacDonnell we would approve. He asked for consent at once. I replied thatI would give him a written consent when the application in writing was received and if it agreed with what he had told me orally. The arrangement was that he would get the letter to me by Monday and that I would send an airmail consent.

Late Friday night Mr. Schapel rang to find out if I was at home because Mr. MacDonnell wanted to speak to me from Sydney. Later Mr. MacDonnell came on the phone and told me that things were moving quickly and that they wanted consent the next day (Saturday) and inquired if I would give it to him if they brought the letter. I said “ Yes “.

I told him that the only difficulty was the typing but I could probably get a typist to come in or I could give consent in my own handwriting. Later on, Mr. Schapel rang again to say that Mr. MacDonald would bring a typist with him.

Saturday, 8th August: Mr. Schapel rang to say that a Miss Faircloth was at my office. On arrival, I was introduced to Miss Faircloth and Mr. Schapell left. She apologised for Mr. MacDonnell, who had been unable to come. She gave me the written application which confirmed what Mr. MacDonnell told me the previous day. I therefore took Miss Faircloth to a typewriter, and she typed out the consent from a draft which I gave to her. I signed the consent and, after handing it to her, took her in my car to Mr.Schapell at Parliament House.

Friday, 21st August: At a meeting of the Capital Issues Board I informed the members of the details of the application by Consolidated Press, and the board expressed complete agreement with my decision to approve the application. At that time, I was not aware of the facts recorded in the next paragraph.

Thursday, 20th August: The news about some big newspaper moves broke into the Daily Mirror of this day, but they did not seem to know anything about the mattersI had discussed with Mr. MacDonnell. From this date onwards I had several telephone inquiries for information from various newspapers. I refused to discuss the matter and said we were under an oath of secrecy. From time to time Mr. Hunter was pestered in the same way but gave the same reply.

Thursday, 27th August: This is the first record on our files of an announcement in the Daily Telegraph of the proposal by Consolidated Press to buy the Associated Newspapers shares.

Friday, 28th August: On this date appeared the notice that the Herald was to acquire an interest in Associated Newspapers.

Saturday, 29th August: Mr. Irish phoned and said he wanted to see me as soon as possible. I suggested Wednesday when I wouldbe in Sydney but he said it would be too late. Moreover, he said the share market was in a turmoil over the Associated Newspapers shares and it was likely that if they could not get the matter settled they might have to ask the Exchange to suspend dealings in Associated Newspapers shares. I said I could see him on Sunday afternoon if he liked - he replied “ I hoped you would suggest that “. He said that he and Mr. McLachlan would motor down on Sunday morning and the arrangement was that he would ring me up at home after lunch on Sunday afternoon.

Sunday, 30th August: Mr. Schapel rang to inquire if I would tell him whether consent had been given to the issue of shares by the Sun to the Sydney Morning Herald. I reminded him that we were under an oath of secrecy and that I could not tell him anything. He replied that he thought it would be so but he hoped that I might help. I replied “ You know that the Daily Telegraph. has been wanting to do something but I have kept my mouth shut about their transactions “.

About 2.30 Mr. Irish rang me from the Hotel Canberra and I actually picked him up and drove him to my office.

I was given their application to read and noted that it contained a reference to the quarrel with the Daily Telegraph. I said that I was quite detached and had no interest in the quarrel one way or the other. The letter also indicated that they knew Consolidated Press had received approval to an issue of shares, but although this was not strictly correct I made no comment.

Mr. Irish again stressed the desirability of not having to suspend the dealings in shares of Associated Newspapers and referredalso to the disquiet which had been caused among the Sun employees. So far as I can recall the words “company taxation “ were never mentioned.

We had no discussions about the budget and in any case I had no idea what was in the Budget. 1 said I would consent to the application but indicated that as I could not type I would have to give a consent in manuscript. Mr. Irish said he could not type but Mr. McLachlan said he could. I said “ You can type the consent if you wish, but it is just as good in manuscript”.

then asked Mr. Irish for the name of one of his clients who had received a consent before February 1951 (up to that date all consents were issued in Canberra) because J was not familiar with the precise form of words. I did this because I did not wish him to see another company’s application. Prom the case he mentioned (Swift and Horndale) I wrote out the consent on a blank approval form and Mr. Mclachlan copied it on the typewriter. I signed the consent. Mr. Irish glanced a.t it. I then took them back in the cai’ and dropped them in Commonwealth Avenue.

After .t had gone to bed on Sunday night, Mr. Whitrod, head of the Commonwealth Investigation Service and in charge of the security service in my office, rang to say that some pressman had been trying to find out the names of the two gentlemen I had interviewed that afternoon. He, being new, told him he did not even know who I was. Anyway, 1 was told that the pressman got no information.

Monday, Kid August: On looking at the consent I discovered that it had been dated Hist August. This was because Miss Duffy had changed my desk calendar on Friday night. On inquiry she confirmed that this was so. I then gave the papers to Mr. Kelly who pointed out that I had omitted to insert the office reference number and that mv name had been typed as “ W. L. Balmford “. I therefore wrote in the presence of Mr. Kelly the following note on the bottom of the carbon copy of the consent - “ This was actually signed on Sunday, 30th August. The error was due to the fact that my date calendar had been altered to Monday, 31st August. I later phoned Dr. Wilson and told him very briefly about (1) the consent given to Associated Newspapers, and (2) the telephone conversation with Mr. Whitrod.

Dr. Wilson was concerned about (2) and suggested that I should ask for a report to be made out. I told him that the Treasurer still knew nothing about the whole affair and that I was thinking of sending him a report. He thought it would bc as well to do so, and I have done so. 1 telephoned Mr. Whitrod but he was away.

Senior Peace Officer Alcock came round to sec me. He said he did not know anything about the matter but promised to make inquiries

Tuesday, )si September: .1. telephoned Mr. Whitrod and told him that I thought lie should prepare a report on Sunday’s incident.

Wednesday, 2nd September: While in Sydney I phoned Mr. Irish about 5 o’clock. I told him that I had discovered three mistake* on the form. I said I attached no importance to the omission of the reference number or the incorrect typing of my name. I wondered ii the incorrect date was of any concern to them. He replied that he had not noticed the error until some time after he returned to Sydney. They were not worried. I said that I would prefer to leave the date as it was and that I had made a note on my file. He again said that they were not worried about the mistake.

The report is signed by W. C. Balmford, , Chairman of the Capital Issues Board.

Dr Evatt:

– Will the Treasurer consider laying on the table the official files of the capital issues authority relating tothe application by the Sydney DailyTelegraph and the application by Associated Newspapers? Will be also consider laying on the table the other documents referred to in the report that he has read? Finally, will he make available to honorable members a copy of theevidence given by Mr. Irish in the recent litigation? I suggest that the. right honorable gentleman move for the printing of the document that he has read.


– I lay on the table the following document : -

Capital Issues Board - Applications from Certain Newspaper Companies - Ministerial Statement, and move -

That the paper be printed.

I have been asked to table the files of theCapital Issues Board-

Dr Evatt:

– Only in relation to these matters.


– The court upheld an objection to Mr. Balmford being called in the recent proceedings to produce those files to the court. It is not considered to be in the public interest to bandy about the country secret information contained in applications to the Commonwealth Capital Issues Board.


– The question is-

That the paper be printed. .

Dr Evatt:

– May I suggest something for the Treasurer’s consideration?


– The Leader of theOpposition (Dr. Evatt) may speak to the question, and then ask for leave to continue his remarks.

Dr. EVATT (Barton- Leader of the the Treasurer to reconsider his last statement, because this document, from beginning to end, deals with the question of how the capital issues authorities handled these two applications. It is therefore a most important matter, and the House, if it so desires, should see the official documents. There can surely be no objection to tabling the official documents with the paper.

Sir Arthur Fadden:

– The right honorable gentleman might as well ask me to put somebody’s tax returns on the table.


– Not at all.

Sir Arthur Fadden:

– It is just the same.


– This is a public application which was granted.

Sir Arthur Fadden:

– It is not a public application.


– It is an application which you have made public by tabling the paper. I ask for leave to continue my remarks at a later stage.

Leave granted ; debate adjourned.

page 532


BUDGET 1953-54

In Committee of Supply: Consideration resumed from the 22nd September (vide page 512), on motion by Sir Arthur Fadden -

That the first item in the Estimates under Division No. 1 - The Senate - namely, “ Salaries and Allowances, £19,900 “, be agreed to.

Upon which Dr. Evatt had moved, by way of amendment -

That the first item be reduced by £1.


.- The habit of giving names to budgets has been followed at least since I have been a member of this Parliament. I consider that this budget should be called the confirmation budget, because it is a confirmation of the promises to stabilize the economy that the Government has made during its term of office. The Treasurer (Sir Arthur Fadden) has had to bear the responsibility for the budgets he has introduced on the Government’s behalf since 1950, and it is only fair to him to recapitulate some of the statements he made when he presented them. The first statement that I shall quote was made by the Treasurer when he introduced the 1951-52 budget which the Opposition has termed the horror budget, but which, in reality, called for a little more effort on the part of the people. The Treasurer said on that occasion -

A government which regards itself as the trustees of the people must be prepared, when the need arises, to tell the people honestly and even bluntly what is required of them. International tension and domestic economic disturbance have now combined to produce that need. While the measures I have announced are clearly not pleasant they are clearly necessary, and in the end theywill prove far less hurtful than the results of unchecked inflation. As a government, we have sufficient confidence in our fellow Australians to believe that they prefer to face their problems and that they have both the courage and the energy which are needed to bring us safely through our present dangers.

I recollect that honorable gentlemen opposite laughed at that time. They said that the Government was whistling in the dark and could not possibly achieve the results it aimed at. When the Treasurer brought down the 1952-53 budget, which got the same reception from honorable gentlemen opposite, he said, after reviewing the situation during the previous twelve months -

Last year with inflation at a dangerous pitch, the Government acted with determination to restore balance between demand and supply. Later, as the situation changed, we adapted and modified our measures to new circumstances. We are further modifying them in this budget according to our judgment of what the situation requires. But, because of the dangers that remain, we are certainly not going to throw them entirely overboard.

I regard the following statement which he made on that occasion as being very significant : -

I hear talk of depression; such talk is dangerous nonsense. With export prices high, with the seasons good, with great defence programmes and works programmes going on, with our population increasing rapidly, with the worst industrial bottlenecks broken, with taxation lower than in any comparable country, it is clear that broad conditions have never been more favorable for enterprise. At least that is true of the material conditions. It may be that it is confidence and faith we need. If that be so, let us look once again across the face of our country.

The conditions which prevail to-day confirm everything said by the Treasurer on those occasions, but the Opposition expressed the greatest disapproval of his statements and his budgets, and did all it could to prevent the present position from being achieved. The present economic stability has been achieved in the face of tremendous handicaps and a hostile Opposition which always showed itself to be more conscious of the electoral boundaries of its members than of the national interest. From time to time honorable members opposite attempted to instil catch-cries into the public mind, and endeavoured to induce an economic depression. Their actions were not in the best interests of the country. Do not let us forget the terrific fight against inflation that the Government has had to undertake, which for some time, gave the Opposition the ammunition it used in its endeavour to convince the public that the Government was not doing a good job. The previous Labour Government contributed to the inflationary condition with which the Government had to deal. Honorable members will recall that the Labour Government at a moment’s notice handed over prices control to the States after the people had decided at a referendum that the Commonwealth should not have control over prices permanently vested in it. The immediate result of that action was to throw the system of prices control into chaos. Prices control should have been handed over to the States gradually, in order to avoid that very result. “When the Government came into office it found itself faced with an inflationary spiral which has taken it until now to check.

Inflation in Australia was the result of a gigantic upheaval, “World “War II.. during which this country naturally experienced a tremendous influx of money and a remarkable disorganization of its production. Those factors caused a tremendous reaction. It is often said -that governments can find money for war but cannot find money for other more constructive purposes. Such a view is “best answered by the analogy of a man who is willing to mortgage his future “himself in order to ensure that his ailing wife will receive the best possible medical and surgical treatment. He will put his future in pawn to meet an emergency. A nation is in exactly the same position when it has to fight a war. It must risk the future in order to make the present secure. Countries with the clearest thinking and the most logical and sacrificial outlook recover from the after effects of war more quickly than do others. If we are really and truly prepared to face the truth we will admit that nations on the other side of the world have dealt with their post-war problems much more realistically than Australia has done. The Government also had other factors to face, which were the result of the secondary war which broke out in Korea. Honorable gentlemen opposite, who have so much to say about our promises in 1949, will not admit at the same time that we faced the problem of the Korean war and had to find the essential money to finance our part in that war. Honorable members opposite have tried to show that the Government’s path has been easy, but besides internal difficulties we had overseas! responsibilities. The Korean war gave a further impetus to inflation, and we had to take firm action to mitigate those inflationary effects. Moreover, in 1951-52 there was a tremendous influx of money because of the high price that was paid for our wool. That had a further effect on inflation in Australia. All those matters were firmly dealt with by the Government, and no honorable member opposite could honestly say that if Labour had been in power it would have been able to take measures that were as effective as those taken by this Government. Of course, import controls had to be imposed - most reluctantly - because a great volume of goods from overseas was flowing into this country to fill the demand created during the war years when goods of all kinds were scarce and to meet the demands of free money. At that time the Labour party called the Government the “stop and go Government “, but we must remember that its actions had to be dictated by the exigencies as they occurred. Although at the time import controls were imposed the people of my own electorate did not anticipate the Government’s action, even though their trade was falling away and now they are quite willing to admit that the Government saved their industries.

After reaching a peak, our wool prices dropped drastically, and our earnings from overseas were reduced by about 30 per cent, within a few months. “When a similar situation occurred in this country in 1930-31 the then Labour Government proved to be absolutely incapable of dealing -with it, and a great depression resulted. It is freely admitted that all experience gained during those years helped this Government to decide the action that it should take to prevent another depression. The economic situation last year was much the same as that which prevailed during 1930-31, but this Government’s action prevented a depression and slowed our rapid economic deterioration down to a mere recession. If a future historian should write the history of the last two years, he will certainly give full credit to the wise administration of a government that has steered the country through a period when it had a depreciating trade balance and a fall of 30 per f-ent. in its export income.

During its period of office this Government has been continually harassed and frustrated by the States. No other single factor has contributed so much to the difficulties of this country over the last few years as has the attitude of the States. They adopted a spendthrift, prodigal son attitude. They demanded exorbitant sums from the Commonwealth and have wasted much of our substance. In Victoria there is plenty of evidence of complete irresponsibility on the part of the States in the spending of the money granted by the Commonwealth. At Yallourn, Morwell and other places, many uncompleted public works prove that the State Government has wasted money by not. developing it for productive use. I also point to the condition of the New South “Wales Government railways, and direct the attention of honorable members to photographs that have been recently published illustrating how money is wasted in that organization. Millions of pounds were thrown away by the States, but all the time their hostility to the Commonweallth increased. Their constant cry was that they could not carry out their works as they should, because the Commonwealth would not give them sufficient money. They demanded money for roads and. education, knowing that the Commonwealth could not provide funds for those purposes because the States under their sovereign rights would not accept directions about the way in which they should spend the money. Nevertheless, on many occasions the Labour party in the States, and the State governments, complained to the electors that they could not do what the electors wanted them to do because the Commonwealth would not supply the money. To help the States it was necessary for the Commonwealth to supplement loans by granting out of revenue some £152,000,000 in 1951-52, and approximately £131,000,000 in 1952-53. The Commonwealth also paid out to the States under the tax reimbursement formula about £60,000,000 more than it needed to.

The Labour party, by distorting the position in relation to the States, succeeded in hoodwinking the electors for a. short time. That was shown by the success of Labour in several general elections and by-elections during the last few years. The Labour party invented several catch-cries, among them “ 100.000 unemployed “. Unemployment in this country in the last few years never reached that figure, but it was a. good round figure for propaganda, purposes. The honorable member for Melbourne (Mr. Calwell) told the people to spend all their money because it would not hold its value for very long. He was completely wrong, because no one can say that money has not firmed in value today. This Government found it necessary to deduct an extra 20 per cent, in taxation from the wool-growers in respect of the next year’s income. The Labour party seized on that action and told the wool-growers that they would never get their money back. The wool-growers believed them for a short time, but at the end of the year, when they found large sums credited to their accounts for income tax, they were thankful to this Government for its action. They now know that they were hoaxed by the Labour party.

I have been a member of this Parliament for about four years and in that time four budgets have been presented to the Australian people. In my opinion there is no doubt that the present budget will prove to be of great assistance to the Australian economy. Honorable members opposite, carefully scrutinizing the budget, have discovered that it will give something to everybody. In an endeavour to find the Achilles heel of the budget, they have seized on the rise in pensions and have directed their attack against that objective. However, ifr is quite apparent that in this budget the Government has been liberal, in every sense of the word, towards the pensioners. Non-Labour governments have increased the age pension from 10s. a week to 1.0s. a day, and of the *70s. a week now paid to pensioners only 22s. has been given by Labour governments while 48s. has been given by non-Labour governments. Non-Labour governments have paid more attention to social services, which must not be confused with socialism, than Labour governments have ever thought of doing, even though Labour puts its so-called virtue before the pensioners on every possible occasion. In view of the Labour party’s propaganda, it is remarkable to find that the pensioners are well aware of the Government’s liberality. The reaction to that propaganda, in the electorates has been very different from that which honorable members opposite expected it to be. Pensioners realize that as the result of the increase of the pension rate to £3 10s. a week, the provision of medical and health benefits and the alleviation of the means test they are in a fortunate position.

Mr Daly:

– Does the honorable member suggest that they are living in luxury?


– The difference between a bare existence and luxurious living is very great indeed. The pension was not intended to enable a pensioner to live in luxury. It was intended to hel p those who need help. I have received a spontaneous letter from a pensioner in my electorate which reads as follows: -

We have been hearing a lot of the Federal Government’s? miserable treatment of pensioners - old aged. My wife, 79, and myself, 83, are both satisfied with what we get and can pay our way. We waste nothing and with an iincrease of 2s. (id. and the cost of necessaries coming down, lesser taxes will be a further increase which will help greatly. You may show the name if you like.

  1. Fitzpatrick.

My correspondent was not afraid to sign his name to the letter. Opposition mem bers talk about persons being able to live in luxury. I remind them that the pension rate is as high as our economy can afford to sustain. At present social services benefits cost the nation £184,000,000 annually. If honorable members- compare that amount with the yield of income tax they will realize that a tremendous contribution towards the upkeep of the pensioners is being made by the taxpayers in the community. Let us consider some of the benefits which the pensioner receives from this Government. Taking into account the value to pensioners of these added benefits, the new pension rate of £3 10s. a week, and the new allowance of permissible income a married couple may have, in value, the basic wage, free of tax, namely £7 pension, £4 permissible income and 16s. in medical, pharmaceutical and hospital benefits. In addition a married couple may have a furnished house free of debt charges, a nest egg of £319 in the bank, insurance policies worth £1,500 and other assets worth £2,500. When we consider these facts we must admit that, having regard to the state of our economy, we are as close as we possibly can be to the elimination of the means test. A married aged couple living in a furnished house of their own may have an income of £11 a week, or the equivalent at bank interest rate of 5 per cent, of the income that may be derived from a saving of £10,000. Any person who contends that this Government has not eased the lot of the pensioners has no sense of values.

Honorable members opposite have failed to offer concerted criticism of the budget. I have not heard any Opposition member comment about the decision of the Government to abolish the differential rate applicable to income from property. If the subject was dealt with by Opposition members it must have been raised at a time when I was absent from the chamber. Opposition members are strangely silent in relation to that matter, perhaps’ because it suits their purpose to ignore it. The truth is that they regard the budget as a good thing for themselves. In these days the members of the Labour party are enjoying the fruits of our much higher standard of living; they also have their properties in addition to their parliamentary salaries. Perhaps that is one of the reasons why the political views which they express in this chamber are so out of harmony with their own way of life and why they do not protest against this concession. They are somewhat like the sundowner who arrives at the farm early enough for a meal but too late to do any work. That, at all events, sums up their attitude to the budget.

One of the outstanding features of the budget proposals is the decision to abolish the entertainments tax. It has been said that once a tax is imposed it is never abolished. This Government has given the lie to that statement. It has given clear evidence that it is a tax-reducing government. It is regrettable that the State Labour governments should exhibit an eagerness to enter the field of entertainments tax so soon after the Commonwealth had announced its decision to vacate it. Instead of allowing the people the benefit of this tax remission the Victorian Government swooped down on the field like a voracious magpie, and announced that it would impose an entertainments tax. When it was criticized for having made that decision it said, in effect, “ Ah, but we propose to impose a tax equal to only one-half of the tax that was imposed by the Commonwealth “ whereas it represents a complete imposition for by this budget there is no Commonwealth tax.

During the last twelve months I, and I suppose many other honorable members, have brought to the notice of the Treasurer the desirability of reducing the sales tax on sporting goods and equipment. Our young athletes and sportsmen appreciate very much the decision of the Government to reduce the tax on such items from 20 per cent, to 12-J per cent.

Opposition members have contended that the Treasurer deliberately pulled the wool over the eyes of the people by implying in his budget speech that tax reductions amounting to £118,000,000 would be made this year. It will be recalled that when the right honorable gentleman introduced the budget he said that the. Government proposed to make tax reductions of an estimated annual value of £118,000,000. He went on to say that it had been estimated that the reductions this year would amount to £81,000,000. Opposition members haveendeavoured throughout this debate tomake the budget proposals appear to beless effective than they will be. Beforethe budget was presented our economy had improved to such a degree that in the Commonwealth Arbitration Court Mr. Eggleston, the representative of theworkers, said -

Inflationary pressure has virtually disappeared. Exports are expanding; overseasfunds are increasing. Employment is rising; profits are increasing. The current economicoutlook is favorable. Productivity is increasing. If you make a comparison between: 1049-50 and the present time in my submission, you find a better condition of the economynow in every respect.

Mr Cramer:

– For which party in thecase did Mr. Eggleston appear,


– He appeared for the. Australian Council of Trades Unions.. Those submissions were made to the court before the Treasurer presented his budget to the Parliament. Despite the gloomypronouncements by Opposition members, the Australian economy is in a strongposition. The Labour Premier of New South Wales, Mr. Cahill, when he introduced his budget in the LegislativeAssembly earlier this week, said -

The recent Commonwealth budget, however,, reduced the very high level of direct and indirect taxation which was restricting initiative and hampering production, and ourGovernment feels that the full effects of theCommonwealth’s budget should not be offset by any measures which would reduce purchasing power in the hands of the people.

We feel that the economy of our Stateshould be allowed a breathing space. By world standards, our level of employment, our production, and our living standards are veryhigh.

During the last three years, the MenziesGovernment has introduced legislation to provide for the election of officials of trade unions by secret ballot. In that way, loyal trade unionists have been ableto rid their organizations of Communist disruptionists, and stoppages have thereby been reduced and production has increased. This Government has also strongly advocated the introduction of” incentives as a means, of obtaining increased production in industry. I read in . the Age newspaper a report that the Australian Council of Trades Unions is now realizing that incentives are necessary and that a number of unions have tacitly agreed that their members should accept them. For that reason, the Australian Council of Trades Unions is inclined to support the system of incen”tives. This attitude reminds me of the story of the Frenchman, who, looking from a window at a crowd passing by, remarked, “I am their leader. I must follow them “. The Government has led the way with the introduction of incentives, and trade union organizations” are following its lead.

Honorable gentlemen on this side of the chamber believe that they have done more for the workers than have members of the Australian Labour party who, during the last three years, have consistently opposed every progressive move taken by the Government, either through the medium of a budget or by legislation, to improve the lot of the working class. The budget now under consideration is the product of party loyalty, a victorious Cabinet and, if we must adopt a series of alliterative titles, a triumphant Treasurer.


– Order! The honorable gentleman’s time has expired. * Quorum .formed.]*


.- I regret that I am the cause of bringing some honorable members from their refreshments into the chamber, but they may console themselves with the knowledge that they were not here earlier to listen to the remarks of the honorable member for Corio (Mr. Opperman) about the successful administration of this Government. The honorable gentleman claimed that the Government’s fight against inflation had succeeded, that the ship of state had entered calm seas, and that the future for the Government was bright. He commented that this Government has been known as the “ stop-and-go “ Government. That description is most apt. One thing is certain : the “ go “ sign will be raised against this Government at the first opportunity the people have to express their opinion of it. The red light for danger has been shining before the Government’s eyes for several years. I forecast that after the general election next year, the Liberal party and the Australian Country party will be in opposition for a long time. The honorable member for Corio remarked, with a show of pride, that this Government had made provision for the election of officials of trade unions by secret ballot. At a secret ballot at the next general election, the people of Australia will cast this Government out of office. The honorable member for Corio considers that the Government has made an excellent recovery in the eyes of the public. I am glad that some one thinks that the Government has improved its position, because I am perfectly well aware that many Australians do not share that view.

The honorable member also considers that pensions have almost reached the maximum figure. He has spoken at great length about the permissible income of pensioners, and claimed that the modification of the means test, granted in this budget, will be of great benefit to them. I am wondering how much that modification will benefit persons who have no income other than their pensions. People who are considerably below the age at which they become entitled to the age pension have” the greatest difficulty in obtaining employment at the present time. The level of unemployment is not high in South Australia, but hundreds of persons between the ages of 55 and 65 years find it almost impossible to get jobs. Will they derive any advantage from the modification of the means test? Will pensioners, who are able to work, be able to obtain employment in order to get a little additional income? Many persons are entirely dependent on their pensions. The honorable member admits that the pensioner is not able to afford luxuries. He may not be aware that the pension will not provide the recipient with the bare necessaries of life. I wonder how some honorable members, who speak so glibly about the purchasing power of pensions, would like to change places with pensioners and live on the miserable pittance for even a week. How would they spend the additional 2s. 6d. that is to be granted to a pensioner under this budget? The honorable member for Port Adelaide (Mr. Thompson) has stated that the 2s. 6d. will not buy half a dozen eggs.

Mr Daly:

– The pensioner will be able to tuy five eggs a week with the additional 2s. 6d.


– This additional half a crown is paltry. All the talk we have heard about the modification of the means te3t and the increase of the permissible income will not increase the purchasing power of the additional 2s. 6d. a week. The Prime Minister (Mr. .Menzies) and the Treasurer (Sir Arthur Fadden) have claimed that this is a good budget and, as such, is welcomed by the people of Australia. The Opposition claims that it is not a good budget, and that many people are disgusted with it.

Mr Graham:

– The Premier of New South Wales considers that it is a good budget.


– The pensioners who live in the electorate of St. George will probably make sure that they change their parliamentary representative next year. The newspapers, in the main, are loud in their praise of the budget. Only a few newspapers have not joined in the chorus. The representatives of big business, the wealthy section of the community, and members and organizers of the Liberal party and the Australian Country party have applauded the budget, as well they may, because it has been, specially prepared in their interests, and gives them something at the expense of the poorer sections of the community. What is the opinion of civil pensioners, war pensioners and war widows of this budget? What do they think of the miserable’ grant of an additional 2s. 6d. a week? The honorable member for Boothby (Mr. McLeay) supports the budget. I give him full marks for the way in which he has battled for the war widows in his electorate, but they will not share his views that it is a good budget and they do not excuse the Government for this paltry payment of half a crown a week. Small shopkeepers, wageearners and persons in the lower income groups do not share the enthusiasm for the budget that has been expressed by big business, newspapers, and members and organizers of the Liberal party. The

Government will not hoodwink the people into believing that it is a good budget.

This Government was elected to office in December, 1949, because the people believed that it would fulfil the many extravagant promises that it made to them during the general election campaign. The Government did precisely nothing to honour those promises in 1950, but was able to claim an alibi. The people were prepared to accept the fact that, because the Government did not have a majority in the Senate, it was not able to implement its pre-election promises. When the double dissolution occurred and a general election was held in 1951, some people who had formerly supported this Government, had “wakened up” to it, and a few seats changed hands. That is to say, in the course of eighteen months, the Government had lost some of the support that it had received at the genera] election in 1949. However, the people, in the main, desired to give the Government an opportunity to implement its programme, and honour its pre-election promises. After the general election of 1951, the Government had command of the Senate and the House of Representatives. More than two years have passed since that general election, yet the Government has not yet honoured its promises. I confidently assert that this is the-last budget that will be presented by the Treasurer.

Mr Daly:

– This is the end of the Government.


– I concur with the forecast of the honorable member for Grayndler (Mr. Daly) . This budget may be regarded as evidence of a deathbed repentance on the part of the Government - a desperate attempt to get “ on side “ with people who had been its most ardent supporters, but who became disgusted with the Government’s bad administration. This dismal attempt to win them back to the Liberal party fold is doomed to failure. The people will not be fooled and hoodwinked again. They are not so silly as to believe that the Government’s repentance is genuine. This Government extracted every penny that it could from the pockets of the people. Known as the “ stop-and-go “ Government, it imposed controls,- withdrew them, and then re-imposed them. This chaotic administration led to unemployment. Now almost on the eve of a general election, the Government’ hopes to convince the people that it has settled down, and will follow a steady policy. The people will not be fooled. In reality, this budget does not reduce taxation. The Government is merely returning to the people some of the money that it took from them unnecessarily last year. The honorable member for Corio said how pleased he was that the sales tax on sporting equipment had been reduced from 20 per cent, to 12$ per cent. That statement was misleading. The truth is that this Government raised the rate of tax on such equipment to 20 per cent. Therefore, the reduction of the rate this year to 12$ per cent, does not represent a true concession. It is merely a restoration of the rate to its former level. If the Government wants to honour the promises that it made, in 1949 and 1951, it must produce a budget that provides for the reduction of taxes below the rates that applied when it took office. It has failed to do so up to date. In fact, it has failed miserably in every respect and is doomed. That is why it is making all sorts of excuses and promises now in an effort to redeem itself.

When I became a member of this Parliament, I knew that honorable members were prepared on occasions to twist statements in order to confuse issues and win support from the people. Nevertheless, I was amazed to hear the interpretation placed by the honorable member for Sturt (Mr. Wilson), with the endorsement of the Prime Minister, upon a statement made by the Leader of the Opposition in relation to pensions and the cost of living. Surely there can be no doubt in anybody’s mind that the Labour party has pledged itself to restore value to pensions so that they will again reach the percentage relationship to the basic wage that prevailed when the Labour Government left office in 1949. It is senseless to talk of the cost of living index. Those who receive the basic wage know that the difference between the basic wage in 1949 and the basic wage to-day truly reflects the increase of the cost of living over that period. Efforts to juggle with the facts will not confuse anybody on that issue.

I was astonished when Government supporters attempted to hoodwink the pensioners by twisting the statement that was made by the Leader of the Opposition. Of course, they have succeeded in tricking the pensioners in the. past, and they probably hope to do so again. But the pensioners have had just about enough of this Government. They are not the fools that Government supporters believe, them to be. Their views have changed since 1949. The present Government parties made rosy promises then, and the people were prepared to give them a chance to govern. However, the people realize now that they were sadly deceived. I am sure that they will not re-elect a government, that tries to bluff them with foolish statements that- are intended solely to win votes. Broken promises will defeat the Government at the general election next year. It has little hope of winning back the support of the people to whom it has dealt so many severe blows since it has been in office.

Government supporters expect the cost of living to fall as a result of the sales taxreductions for which the budget provides, but the conduct of manufacturers and traders indicates that their hopes will be dashed. Government supporters should go into shops and try to buy some of the many items that have benefited from sales tax reductions. They will find, if they do so, that many of the items are just as dear as they were previously, and that some of them are even dearer. The Treasurer made a point of referring in his budget speech to the lifting of sales tax from water softeners. Honorable members who come from South Australia may remember the prices at which water softeners were advertised at the Adelaide Royal Show before the budget was presented. They will find now, if they care to investigate, that in some instances the prices of these articles have been increased instead of decreased. Manufacturers have said that they are sorry that they cannot hand on to the public the benefit of. the sales tax reductions, but they want to recoup the high costs that they have had to bear during the past year. What a sad day it was when the present Government parties succeeded in bringing about the defeat of the referendum proposal for the administration of prices control by the Commonwealth. If we had effective prices control in Australia to-day, the benefits of sales tax reductions could be passed on to the consumers. Not satisfied with the large direct tax reductions for which the budget provides, big business wants to take a large slice of the sales tax remissions for itself. I have here a publication issued by the Federal Chamber of Automotive Industries in which the budget is criticized. This organization is not a supporter of the Labour party, and therefore its attack upon the present Government is of particular interest. This is what it has to say about the budget of which the Government and its supporters are so proud -

The budget introduces some new and strange anomalies. Spirits, for instance, including imported Scotch whisky, enjoy an excise relief of 21s. a gallon, whereas duty and excise on petrol, the means by which all Australian goods and services are, at some stage, moved or operated, will continue to pay an unchanged rate returning some 30,000,000 per year to Commonwealth revenue. Sales tax on commercial motor vehicles remains unchanged, at I2i per cent.

The sales tax on luxury motor cars, of course, has been slightly reduced.

Once again this year, certain newspapers were able to predict many of the features of the budget with notable accuracy. For many months prior to the presentation of the budget, senior Ministers were busy making half-promises to the public in an effort to persuade them that the budget would be of help to them. These half-promises were so freely made that many companies were unable to sell their products for some time prior to budget day. Forecasts that sales tax on luxury motor cars, for example, would be induced caused such a panic that at least two companies which sell motor cars offered vehicles at big discounts. The accurate forecasts made by journalists played havoc with the business community. I hope that the Government will not allow the leakage of information to pass without conducting a serious investigation. It should attempt to find out how journalists were able to obtain such accurate foreknowledge of the contents of the budget.

The nest matter that I wish to discuss was not mentioned in the budget papers, but it is of first-class importance to the people of Australia. Not long ago I asked the Prime Minister whether the Government had any intention of dealing with unsavoury imported magazines and socalled comics which are circulating in Australia. I pointed out to him that the Premier of South Australia had said that State governments were finding it very difficult to deal with these publications. The Prime Minister said that the matter had. been discussed at the previous conference of Commonwealth and State Ministers, but that, so far this Government had not been able to do anything. He promised that it would do what it could to help the State governments. The Premiers, of course, say, “ We find it difficult, but if we can help we will do what we can “. Somebody must soon take the responsibility for failure to act against these publications. It is of no help for the Prime Minister to say, “ Fortunately I have not been corrupted, because I have not seen these comics “. Every member of this Parliament and of the six State parliaments has a responsibility in this matter, and I hope that the Government will not merely stand by and wait for the State governments to do something about this menace. It should protect the morals of Australian children. When dessicated coco-nut threatened the lives ‘of people recently, the health authorities in all parts of Australia promptly went into action to safeguard the community. The unsavoury magazines arid comics of which I have spoken are not, perhaps, a deadly threat to life, but they seriously affect the morals of young people. I am pleased to note that at least one organization, a newspaper company, has entered the field against these objectionable publications and is supplying a good, wholesome comic paper for young people. I refer to the Eagle, which caters magnificently for the wants of children. Most honorable members read in their school days such good publications as Union Jack. the Sexton Blake Library and Magnet, all of which contained good literature which in its own way was educational.

Mr Haylen:

– What about Billy Bunter?


– This Government will be worse than Billy Bunter if it does not accept its responsibility in this matter. Somebody must give a lead, and I, hope that the Prime Minister will not just sit back again and leave the problem to the State Premiers.

I come now to a parochial matter. Not long ago I asked the Minister for Civil Aviation (Mr. Anthony) a question about the construction of the West Beach airport in South Australia. Honorable members must be tired of hearing this matter raised time after time, but I can assure them that I have become even more tired of raising it. West Beach airport should have been finished long ago, but apparently it will be left to the honorable member for Maribyrnong (Mr. Drakeford), who initiated the project, to finish it and to open the airport when he becomes Minister for Civil Aviation again. The work is proceeding very slowly. The Minister, in a letter addressed to me, stated -

State Governments complain that their funds are limited and that they have had to slow down many of their works as a result. What applies to the State Governments applies” no less to the Commonwealth departments, which arc equally limited in the amount of funds available to them. My department is no exception to the rule. Therefore, I am not able to say when we can proceed with the work that is necessary. We are going ahead with it as fast as money and other considerations will permit.

I do not know whether the Government regards the construction of West Beach airport as only a civilian project. I regard it as a defence project which should therefore, be given some priority. I have been told by a former Minister for Civil Aviation, the honorable member for Maribyrnong, that when the London airport at Heathrow was opened proper facilities for the accommodation of passengers were not available and that temporary accommodation was provided in marquees. I hope that the Minister for Civil Aviation will investigate this matter and ascertain whether it will be possible to put West Beach aerodrome into service as soon as the second runway has been completed and adequate radio facilities have been provided. If -the airport is put into service, the Government will begin to derive some revenue from it which will, to some degree, offset the expenditure involved.

I want to say, in conclusion, that the Government members and well-wishers who say that the tide has turned are very much like the small boy who whistles to bolster his courage when he is passing a graveyard. But the gravestones in the graveyard of the Menzies-Fadden coalition are too numerous to be forgotten. There is no doubt that when the people of Australia are able to make a decision, they will dismiss this Government from office and elect a Labour government to carry on the good work that the Chifley Government was doing. We shall be prepared to accept that responsibility and to carry on from when! we left off in 1949.

Minister for Shipping and Transport · Boothby · LP

.- J am delighted to have the unique experience of following my own federal member. Let me put the mind of the honorable- member for Kingston (Mr. Galvin) at rest. Having listened to his contribution to the debate, there is no doubt in my mind about how I shall cast my vote in the Kingston electorate in 1954. Before I proceed further with my speech, let me say how pleasant itis to sit under the new Temporary Chairman of Committees (Mr. Timson). As a member of the House of Representatives, sir, you enjoy the confidence and goodwill of your colleague.s. I am certain that, after you have wielded the baton of authority, you will have the respect of the Opposition.

I have listened, sometimes unwillingly and sometimes with pleasure, to a number of speeches on the budget. The honorable member for Kingston, the honorable member for Adelaide (Mr. Chambers) and other honorable members opposite have been most caustic in their criticism of the activities of this Government under the leadership of the Prime Minister (Mr. Menzies), assisted by the Treasurer (Sir Arthur Fadden), who is also the Leader of the Australian Country party. Let me remind the committee of happenings since this Government was elected in 1949. The present Government parties were returned to office in that year with one of the largest majorities in this chamber that we had ever had, but, as the result of an alteration of the system of voting in elections for the Senate, we were without real authority or power. In this chamber, we dealt with many problems and submitted many measures to the Senate, but the members of the Labour party there did not wish the Senate to discharge its proper function as a house of review, a non-political house, to watch the interests of the States. They wanted to play politics. There is ample evidence that they used their majority in the Senate to delay, frustrate, amend and ridicule all legislation submitted to them by the Government. We agree that Her Majesty’s Opposition has a duty to criticize legislation introduced by the Government, but, in my view, the measures which dealt with national service, Communists, secret ballots and many other subjects that were submitted to the Senate were dealt with by the members of the Labour party there, not from the national viewpoint, but from the viewpoint only of party politics.

A great deal has been said by honorable members opposite about what the Government has not done. Let me remind them that, with the exception of a measure for the taking of a referendum on any proposal to nationalize industry, the Government has introduced all the major legislation to which the present Prime Minister referred in his policy speech in 1949.. I am certain that no other Prime Minister of this country has regarded his promises as more sacred than has the Prime Minister under whom I am delighted to serve. On the legislation for the dissolution of the Communist party and on that in relation to child endowment, national service training and representation in the Senate, we expected the support of the Opposition. The legislation in relation to the Senate was designed to establish a logical situation and avoid the risk of stagnation in that chamber due to equality of numbers. Unfortunately, however, our efforts were frustrated until the Labour party received directions from an outside body.

Some very good speeches have been made in this debate. The speech that the Prime Minister delivered last Thursday was outstanding. The Minister for Social Services (Mr. Townley), ably supported by the honorable member for Sturt (Mr. Wilson), disposed of the arguments advanced by the Leader of the Opposition (Dr. Evatt) and refuted the poppycock that the Labour party and certain sections of the press have publicized throughout Australia.

I express my appreciation of the remarks of the honorable member for Kingston in relation to war widows. I hope that, as representatives of the people, we shall never forget that we have an obligation to the dependants of those who fell in the defence of this country. If ever a returned serviceman who served for even one day in the front line enters public life and forgets our obligations to the dependants of the men who were killed in war, he will no longer be worthy to be recognized as an exmember of the Australian Imperial Force. The great majority of honorable members who are ex-servicemen sit on this side of the chamber. Nothing will convince the Minister for Social Services that pensioners are not getting a better spin under this Government than they got under Labour governments. Perhaps it will be as well to cite some figures, although I do not like to have much to do with figures. We have heard quite a lot about general rate pensioners. In 1946, the general rate pension was paid at the rate of £2 10s. a week. In 1948, the Labour party, after very heavy pressure had been applied to it by ex-servicemen’s organizations throughout the Commonwealth, decided to increase the pension by 5s. a week. During the last four years of office of Labour, the general rate pension was increased by only 5s. a week.

Mr Haylen:

– ‘What was the basic wage in those days?


– I am not interested in the basic wage in this connexion. The cost of living is calculated on the C series index, and that has been taken into consideration by this Government. The Minister for Social Services gave a full and complete answer to the’ criticism levelled against the Government in connexion with the relationship of the basic wage and pensions. Since this Government has been in office, the general rate pension has been increased by an amount which represents 500 per cent, of the increase granted by Labour. The special rate pension was £4 16s. a week in 1946. In 1947, it was increased to £5 ls. a week, in 194S to £5 6s. a week, and in 1949 no further increase was made. The record of the Labour party is that in a period of four years it increased the special rate pension by only 10s. a week. Under this Government, the pension has been increased .by £3 19s. a week. That increase is 800 per cent, greater than that given by Labour.

Let me turn to the domestic allowance for war widows. In my view, that is a very important allowance. It is based on need. It is payable to war widows of 50 years of age or more, and to war widows with children, I believe that the two classes of people in respect of whom the Government has the greatest responsibility are war widows with children and those who are advancing from middle age. During the last four years of office of Labour, that allowance was paid at the rate of 7s. 6d. a week. In a corresponding period, this Government has increased it by 27s. a week, or by nearly 400 per cent. In addition, it has granted concessions to a war widow who has a child that has reached the age of sixteen years. Normally, the allowance would cease to be paid when a child reached that age, but it is to the credit of the responsible Minister that, after representations had been made to him, he agreed that the allowance should continue to be paid until the child was earning the adult wage. That is, in itself, a great contribution. While I am discussing the subject of war widows, which seems to be one of my hobbies, I wish to say that in my association with some of these people I have become familiar, as have other honorable members, with the problems that face them from time to time. When the Labour Government was in office war widows were compelled to walk to post offices in order to collect their pensions. As the result of representations made to this Government a system under which war widows may receive their pensions by post has been adopted. In addition, a war widow who remarries is granted an amount of £180 for the purpose of providing herself with the items necessary for her trousseau.

The Government’s record in respect of war service homes, endowment for the first child, which was opposed by the

Labour party, and the housing problems of war widows, is commendable. A Minister in the previous Labour Government refused to allow war widows to buy war service homes. That anomaly has been removed by the Minister for Social Services, to his eternal credit, and a war widow may now buy a war service home after paying a deposit of less than £50. The Minister has done a great service to these people in that way. Unfortunately, as war widows did not have the benefit of that facility during the term of office of the Labour Government, when war service homes were available more cheaply than now, they are compelled to pay four or five times as much for a home as’ they would have had to pay in those days. It can be rightly claimed that the Government has given a new deal to exservicemen and their dependants.

I turn now to the subject of taxation. I shall cite to the committee figures relating to the income groups with which I have had some personal experience. In 1948- 49, under the Labour Government, a man without dependants, who earned £600 a year, paid £74 14s. in tax. In 1949- 50 he paid £53 10s. in tax; in 1953-54, under this Government, he will pay £43 19s. The comparable figures for a man without dependants, who earns £800 a year, are as follows: - 1948-49, £124 14s.; 1949-50, £91 10s.; 1953-54, £77 .6s. The figures for a man earning £1,000 are- £1S4 4s. ; £137 10s. ; £117 6s. A man with a dependent wife who earns £600 a year paid in tax in 1948-49. £56 ls. ; in 1949-50, £40 6s. ; and will pay in 1953-54, £26 14s. A similar taxpayer who earns £800 a year would have paid in 1949-50 and 1950-51, £101 6s. and £74 7s. respectively. This year, he will pay £55 ls. The figures for a taxpayer in the £1,000 group are £157, £116 18s., and £90 14s.

A taxpayer with a dependent wife and child who earns £600 a year, paid in 1948-49, £45; in 1949-50, £30 19s.; and will pay this year £17 16s. The figures for a similar taxpayer earning £800 are £85 15s., £62 18s., and £42 17s. For a taxpayer earning £1,000, they are £138 lis., £103 3s., and £75 15s.

I have cited those figures because they refer to the income groups with which I have had some association. They substantiate the Government’s claims to have reduced taxes. The figures that are distorted by some professional accountant or adviser on the other side of the committee continually overlook the fact that since 1949 there has been an increase of 431,000 people liable for income tax. It is interesting to note that the Chifley Government took from the people in taxes £504,000,000 and left them with £1,289,000,000. This Government will this year leave the people with £2,730,000,000.

One important achievement of the Government is the restoration of Australia’s prestige abroad, which has resulted from the magnificent example, the conduct and the general approach to British Commonwealth problems that the Prime Minister has shown. During the dark and grim days of 1950 and 1951 trading concerns in Australia spent beyond their ability to pay. The Prime Minister was compelled, in March, 1952, to correct that position by the imposition of import restrictions. As a result, Australia’s prestige in the Mother Country suffered a great blow. We can claim, however, that the Prime Minister’s action at that time prevented the complete bankruptcy of many of our trading concerns. It is well known that when the Prime Minister visited Great Britain to attend a conference of Commonwealth Prime Ministers he was coldly received by the great trading organizations at Manchester and elsewhere. After he had given them the facts, and had explained to them Australia’s problems vis-a-vis Great Britain’s problems, their whole attitude changed. It is true to say that never in the history of Australia has anybody commanded greater respect than the Prime Minister commanded on that occasion. He has also done a marvellous job in bringing about an atmosphere of tolerance, goodwill and co-operation between this country and the United States of America, which has been of great assistance to us.

The Minister for External Affairs (Mr. Casey) has also enhanced Australia’s prestige abroad as a result of his friendly, intelligent and capable approach to international problems, the handling of which requires somebody possessed of great diplomatic ability. He is held in the highest esteem in all the countries with, which we are associated in the great march to freedom.

There has never been, in public life, in the history of this Commonwealth any individual who has been subjected to as much abuse and criticism as the Treasurer. He has often been the target for unjust attacks, which have been madenot only by the Labour party but also by many sections of the press and even by many of his own followers. We can. consider ourselves fortunate that we had a person of the achievements, courage and character of the Treasurer at the helm when we were passing through one of the greatest economic crises in our historyThere is no doubt about his courageand. the fearless manner in which heapproached the problem of inflation. His unflagging efforts to halt inflation brought upon him an avalanche of criticism. Hiscourage and his approach to national, problems will always stand to his creditWhile the Prime Minister was overseas and other Cabinet Ministers werescattered over Australia attending to their responsibilities, the Treasurer, in the words of the Australian Imperial Forces, was not “ well flanked “, but he never left his post. He was on the job,, ready and willing to face the onslaughtsthat any Minister who fearlessly performsan unpleasant duty must face. Theatmosphere has completely changed, to-day. The more intelligent honorablemembers opposite, and even the honorablemember for Watson (Mr. Curtin), can. see clearly that the policy implemented! by the Treasurer was in the best interest of the nation, and not only of sections of the community, although they may not admit it.

I turn now to the problem of the financing of local government activities. I have had some association with local government and the community services that local governing bodies provide, and I am unable to understand why the AustralianGovernment and the State governmentshave never been prepared to accept their share of the responsibility of meeting thecosts of essential services which are provided by local government. I pay tributeto this Government for having, for the first time, made a substantial concession, in relation to the demands that have been: made on the Commonwealth by local governing bodies. People in authority are inclined to overlook the fact that ratepayers are a minority section of the whole body of citizens, yet it is on them that there falls the responsibility of paying for all the essential community services such as lighting, fire cover, road3, footpaths, kerbs, parks and so on. Many representations about the matter have been made to the Commonwealth and they have had some result, but figures for various local governing areas, including some that are within the divisions represented by honorable members opposite, demonstrate the burdens carried by local government. For instance, I remind the honorable member for Hindmarsh (Mr. Clyde Cameron) that one local governing “body in his electorate, West Torrens, which has 12,408 ratepayers, loses £7,601 Ils. 8d. a year in rates because the Commonwealth is exempt from paying rates for its property. The municipality of Prospect, in the division of Adelaide, is in a different position. It has 9,850 ratepayers and loses only £58 2s. 6d. In my view, it is the duty of every local governing body to persuade the Government to establish government activities in its area, but when the burden of responsibility falls unduly and unjustly on a particular local governing body the Commonwealth should ensure that the revenue lost to the council thereby will not have to be met by local ratepayers but will be borne by the people of Australia as a whole. I wish to pay a tribute to people engaged in local government activities who have done so much for the welfare of the community and the development of the areas in which they live, because I have found that people in other walks of life are inclined to overlook their value. They believe that their only useful functions are to chair various political meetings held in their own districts. Disease immunization and the treatment of tuberculosis was carried out by Adelaide City long before the Commonwealth assisted the States in these matters, and such services were mainly financed out of the pockets of a small section of the people. I hope that this Government, and the State governments, will not shelter behind the Constitution, but will endeavour to co-operate and meet their commitments to the groups of people about which I have been speaking.

I express appreciation to the Government on behalf of all those interested, for sending a delegation to Runnymede for the unveiling by Her Majesty of the honour roll which bears the names of those soldiers who have no known graves. I compliment the Government not only upon sending the delegation, but also upon the calibre of the representatives that it selected. The Government has also decided to send a delegation to the unveiling of various memorials to our servicemen in the islands. Those ceremonies are to be conducted by the Governor-General. I hope that when the Government is selecting the personnel of the delegations it will bear in mind the claims of the women who lost their husbands in World War I. and later lost a son or sons in World War II. The claims of these widows should be carefully considered, because they will be able to represent those who are not here to speak for themselves. I am proud to be associated with the Menzies Government. If the electors carefully analyse the budget, I have no doubt that -1954 will see this Government returned to office to continue the great prosperity initiated during its regime.


.- The honorable member for Boothby (Mr. McLeay) said that he did not have much faith in figures. However, he said that he did know something about an income of £600 a year. I also know something about an income of £600 a year, although I did not receive that much in 1949. If I had received £600 a year at that time I would have been prepared to pay my taxes, because I would have been earning about twice the basic wage. Moreover, I would have been much better off to-day than I am, and, perhaps, would have had a car to use in my electorate as have some’ other honorable members. However, in 1949 a man, with a wife and two children, who received £600 a year, would have been required to pay £38 lis. as a social services contribution, and would not have been required to pay any income tax. A man, with a wife and two children, who earned the basic wage in 1949, paid neither income tax nor social services contribution. At present, a man earning £600 a year earns less than the basic wage, which is about £631 a year, but has to pay £18 16s. in income tax. Also, a man, with a wife and two children, whose income was £350 last year, bad to pay 16s. in taxation. Therefore, the figures of the honorable member for Boothby, like those of other honorable members on the Government side, are misleading, and the arguments developed from those figures will not affect thu people when they vote at the general election in a few months time.

It would be futile and wrong for me to tell honorable members that no concessions are proposed in the budget, but it is equally futile and wrong for Government supporters to try to convince the people that the budget will give practical relief to all sections of the community. This budget will go down in history as a document that has been designed solely to win support for the Government at the next general election. The Government has introduced the budget in an attempt to save its supporters from political annihilation. In that respect it may be called enterprising, because it will give relief from taxation to the solid core of liberal supporters, will comfort those who sometimes support it and will throw a few crumbs to those, who because of their lot in life, grasp at any straw to keep themselves afloat. On the other hand, there are many thousands of persons who are living on the basic wage, and many who are age and invalid pensioners, widows and unemployed and sick persons, who get barely anything at all. This budget is a cruel and harsh document to them. ‘ It is deceitful and false, and it does not do the things or give the relief with which it is credited. Thousands of persons will receive no help through the budget, as I will show as I develop my subject. The arguments of the Government in support of the budget proposals are specious, and have been made only to bolster up its case to the people at the next general election. Many of the budget proposals will in no way help the citizen who needs to be helped most of all. For instance, the increased allowances which will be granted for dental expenses will be of uo benefit to hundreds of thousands of people who lost their teeth long ago because they could not pay to have them attended to, and who have worn dentures for many years. The 2s. 6d. a week increase of the base pension will not be of much advantage, because the pensioner who has m> other means of support will find that the 2s. 6d. increase will not even begin to cover the increased costs of the essentials of life.

The Treasurer (Sir Arthur Fadden) referred to the difficult phase through which our economy has passed during the past two years. He traced the history of economic development during that period, and pointed out how retail prices had increased, how supplies of materials and labour had deteriorated, how the loan market had collapsed and how a great volume of imports had started to flood the country. The Treasurer blamed all those factors for the violent inflationary boom that then ungulfed us, and gave them as reasons for the excessive taxation in 1951-52. However, I remind honorable members that this Government was responsible for the flood of imports into Australia, because it lifted import restrictions and relaxed capital issues control in spite of all the warnings given by honorable members on this side of the chamber. The honorable member for Melbourne (Mr. Calwell) repeatedly directed the attention of the Government to the inevitable results of its policy. After the damage had been done, and thousands of people had been thrown out of work, the Government re-imposed the import restrictions that it had previously removed. Now the Treasurer, and the members of the Government, pretend that stability has been restored to the nation and that all is well with its economy. How can the Government believe that that is so in view of the fact that about 250,000 of our people almost starve on a mere pittance of £3 10s. a week, and many, who are unemployable, receive no Government assistance whatsoever.

Last week the Prime Minister (Mr. Menzies), when speaking in this debate, claimed that the budget was the best since the war, and challenged the Opposition to prove otherwise. I accept the challenge of the Prime Minister, and join issue with him on this matter. I say quite emphatically that the Chifley budget of 1949-50 was much more beneficial to the taxpayers and the pensioners alike than is this budget. Admittedly, in some instances tax reductions may be greater under this budget than they were in 1949, especially the reductions of company tax and the taxation on higher income groups, but it must always be remembered that the Chifley budget involved only half as much money as was raised under each of the last two budgets of the Menzies-Fadden coalition, and that the value of the £1 was much higher then than it is to-day. In 1949 working people and pensioners were not required to pay exorbitant indirect taxes on the essential commodities that they purchased, and it was this Government which raised the base sales tax rate from 8$ per cent, to 12-£ per cent, and included in that tax bracket many items, such as ice cream, milk foods and similar consumer goods. Moreover, this Government has retained the base sales tax rate at 12 £ per cent, in this budget. The Government did that because it knows that almost every family consumes ice cream as a dessert, and, for many years, it has not been acknowledged as only a child’s luxury. It is a family food, and the Government taxes it because it is a good revenue earner. However, this taxation has deprived the pensioner of if-e c-ream as a food, because it has become too dear for him to buy. The budget proposes to reduce sales tax on luxury lines from 50 per cent, to 16 per cent., but who will get the benefit of that reduction? Only the wealthy.

In the proposals of the Treasurer that relate to personal exertion income tax exemptions there is neither equity nor justice. The Government has blundered, badly in its approach to this problem. Never at any time did a Labour government impose such crushing taxation upon the family man as this Government has done. It has been said that the Government has reduced taxation by an average of .12^ per cent., but why did the Government ever impose tax on married couples incomes were less than the basic wage? Last year, the Government taxed workers with families whose wages were a.= low as £350 a year, or £7 a week. This year, the same families will have to pay £1 2s. in tax on a wage of £8 a week or £400 a year. Yet the basic wage is £12 3s. a week! Even in the midst of war the Labour government did not impose such high taxes. To-day, this Government takes from the basic wage worker with a wife and two children just on £14 a year, yet it claims to have reduced his tax by £5 15s. a year. If any one was ever trying to work the threecard trick on the people, the Treasurer is doing that by such a claim. In fact, the Government is taking more from the workers now than any government has ever taken before because it has conscripted the people into hospital and medical benefit societies. The Government claims to have established a free hospital service for pensioners. What a ridiculous claim ! All that it does in regard to hospital benefits for pensioners is to pay a subsidy of £4 4s. a week when pensioners are admitted to hospital. The State governments have to gay the remainder of the fees charged by the hospitals. Prior to last year, every worker or member of his family who became ill and had to be admitted to a public hospital paid nothing. The Chifley Government had an agreement with the States under which it paid 8s. a day for every day a patient spent in hospital. The basic wage was then £6 12s. a week. This Government altered the arrangement and increased the amount to 12s., provided the worker had joined an approved hospital benefit organization. In this way, the States were coerced into accepting the Government’s ultimatum, and now every worker has to pay 2s. a week, or £5 4s. a year, to insure his family against the cost of illness. But that is not all. The Government also introduced a medical -benefits scheme under which the family man has to pay up to 3s. a week for medical services. This means that, provided he suffers no illness, his wage is further reduced by more than £7 a year. Should he or a member of his family suffer an illness, he becomes liable for further payments because the medical benefits fund pays only up to 90 per cent, of the cost of medical attention. In many instances workers have to pay through the nose for medical treatment.

This Government claims to have provided free medical services for pensioners, to have assisted the people by the provision of hospital and medical benefits and to have reduced taxation. I submit that the fact that the worker has been conscripted into joining these schemes means that he has to pay more in direct and indirect taxation than he has paid at any other period during his lifetime. Thus, he will not receive the benefit of the 12$ per cent, overall reduction which the Treasurer claims to have made in taxation. ‘ Prior to the introduction of the iniquitous medical benefits scheme, families on low incomes, especially those in the industrial cities, were able to join clubs or lodges run by doctors, and, for the payment of quarterly sums of about 25s., received excellent medical service. But the Government decided to compel the workers to pay an additional £7 a year out of their meagre incomes to protect the health of their families, thus still further reducing their earnings. If Government supporters do a little reckoning they will soon see whether or not the Government has been overkind to the majority of the people. In a great many instances the taxpayer is now worse off than he was at this time last year.

The Minister for Social Services (Mr. Townley), in his speech on the budget, described at great length how the Government had increased the rate of age and invalid pensions from £2 2s. 6d. to £3 10s. a week and had considerably eased the means test. He said, in effect, that the Chifley Government had increased pensions by only 21s. a week, whereas the Government of which he is a member had increased the pension rate by 7s. 6d. in 1950, by 10s. in 1951, and by 7s. 6d. in 1952, and that it has now approved of a further increase of 2s. 6d. a week. The Minister would have us believe that the Government has provided manna from heaven for the pensioners and that they are now living in luxury. What are the facts? Between 1942 and November, 1948, which was tinlast occasion on which the Chifley Government increased pensions, the basic wage rose by only £2 a week, yet the Labour Government increased the pension rate by 21s. a week. At the time the increase was made I did not consider it to be sufficient, but at least it was a more generous addition to the rate than this Government has made out. Since the Menzies Government has been in office the basic wage has almost doubled. It has been increased by no less than £5 lis. a week in less than four years. From November, 1949, to June, 1950, it roseby 16s. and the pensioner received an additional 7s. 6d. a week. During the next three financial years the wage rose by 42s. in 1951, for an increase of 10s. in pension rates, by 45s. in 1952, for an increase of 7s. 6d., and in 1953, up to the period when the Commonwealth Arbitration Court froze the basic wage,, by another 20s. This year the pensioner is to be given the handsome addition to his pension rate of 2s. 6d. a week. The practice of basing the pension rate on the C series index figure is completely wrong. If justice is to be done to the pensioners, the pension must be related to the basic wage.

During the period when these increases of the basic wage took place the prices of essential commodities reached exorbitant heights. Butter rose to 4s. l$d. per lb.; bread to ls. Id. a loaf; bacon to 6s. Id. per lb.; ham to 7s. 9d. per lb.; eggs to 6s. 6d. a dozen; tea to 4s. 9d. per lb. ; and milk to ll$d. a pint. Meat prices were so high that pensioners could not buy it. The present price of potatoes is ls. 10$d. per lb., or approximately £70’ a ton. Green vegetables are so dear that pensioners are unable to purchase them. Rents paid by thousands of pensionersare as high as those charged to many other persons. Clothing prices are so high that pensioners are unable to purchase their clothing needs. In my electorate appeals are constantly being n ladeby pensioners’ organizations for old clothing. These appeals are similar to those that are conducted by missions, religious bodies and benevolent organizations. The clothing collected is passed on to those poor old souls who cannot live on the so-called magnificent pension of £3 10s. a week which the Treasurer, the PrimeMinister and the Minister for Social Services say they have given to them. Last week the Reverend Alan Walker, leader of the Mission to the Nation, commenting on the budget, struck a note which is well worth repeating. Referring to the Treasurer Mr. Walker said -

A nobler Australian would have placed pressure on him to do as much as possible to meet human need, even if taxation had to remain at its present level or even if higher taxes were involved. On humanitarian grounds, the small pension increases are utterly inadequate. Values are all wrong when” more is to be saved every time a bottle of whisky is bought, or a visit is made to the races, than we are prepared to give in a weekly increase to our needy pensioners.

More than 250,000 pensioners are compelled to live on the miserable allowance of £3 10s. a week which this Government has thrown to them. Many of them have no other income to supplement their pension, and consequently they are practically left to starve.

A social services benefit which has been neglected by the Government is provision for the care of the aged who have been left alone in the world, unclaimed and uncared for by their relatives, who because of their age, are no longer able to cure for themselves and are left without proper shelter and attention. Almost every politician in Australia should hang his head in shame because of the failure of all governments to provide proper and sufficient institutions to house and care for these dear old people. In Australia there must be thousands of old men and women who have nowhere to go and no one to look after them. During the last twelve months or so privately conducted institutions have sprung up everywhere to cater for these homeless people. The proprietors advertise that their institutions are functioning as approved hospitals and will accept as inmates aged patients provided they are able to look after themselves, at fees that range from £9 9s. to £18 18s. a week. Recently, I visited one of these institutions in New South Wales and was shocked by what I saw. The charge for accommodation and care was £9 9s. a week. Approximately 50 persons were accommodated at the hospital. In one ward there were five old women, all bed cases. The room was poorly furnished. There were no curtains on the windows and the blinds were old. The beds consisted of old iron bedsteads covered by old and worn blankets and linen. The furniture consisted of only one cupboard and a dressing table to each room. The patients did not have even a pedestal upon which they could place their personal belongings. The room I visited was clean, but it smelt musty. One of the ladies in whom I was interested was found to be lying in a wet nightdress which had apparently been left unchanged for hours. My friends changed it for her. When the women were handed refreshments, the sight was horrible. They appeared to be half starved. They simply put the food to their mouths and pushed it in with both hands, after which they picked up and ate the crumbs. Since the introduction of the hospital benefits scheme numerous old houses have become registered hospitals, the proprietors of which charge patients what they like for the meagre services rendered. A charge of £9 9s. a week seems to be almost the minimum. Such a charge is made up of £3 7s. 6d. pension, £2 16s. Commonwealth subsidy and £1 8s. from a registered society, the remaining £1 17s. 6d., being paid by some person who is prepared to pay it on behalf of the patient. For some time I have been assisting to pay that amount on behalf of the old lady to whom I have referred. Our aged and infirm folk are being used in many instances as an instrument by money-making profiteers to exact from them and from the Government all that they can take from them under the guise of philanthropy.

So that honorable members may readily understand the condition of some of these places I shall quote a few lines from a letter that I have received from a lady who has been caring for one of these old people. The letter reads -

I am sure you will be pleased to know that Mrs. Forshaw went to Newington yesterday. It was a scramble as the first thing I knew was the ambulance calling here for her. However, after a little turmoil and phoning another ambulance called at the hospital. I went with her taking the nighties that the hospital packed. Was very delighted with the appearance of the hospital and Mrs. Forshaw was placed in a very comfortable bed. A large coal fire was burning in the ward and seemingly a kindly, sensible nursing sister was in charge. I almost wept with relief to know that at last she will receive proper care. The shocking neglect and loss of her goods at the hospital should be exposed. The poor soul was in a hard chair, on cold Mackintosh. She was tied to a chair all day, at times only barely covered. Newington would not take her nighties so I thought perhaps you would

Mku them returned. However, on my return home, I found them all to be huge, cheap flannelette nighties marked with every one else’s name but hers. Only one of them belonged to her. So much for a private hospital at £0 9s. per week!

Some honorable members from other States may not be aware that Newington is the hospital for aged persons conducted by the New South Wales Government. I am gratified to know that at least some of our old people can be admitted to this institution. I believe that the Commonwealth should provide funds for the erection of suitable homes, or institutions, for elderly people who have no one to look after them. Institutions of this kind have been built in some of the Scandinavian countries. In my opinion, the Commonwealth could conduct its own institutions much more cheaply, and give infinitely better service to the aged and infirm, than the service provided by many of the places that have sprung up during the last few years. The newspapers each week carry advertisements that are inserted by money-hungry people who offer to provide accommodation for the aged. One day recently, the Sydney Morning Herald published eighteen advertisements of places which were prepared to admit old people, who could look after themselves. The charges ranged from £9 9s. to £18 18s. a week.

I hope the Government will give serious consideration to the advisability of paying a subsidy to private citizens who are prepared to look after aged and infirm folk, particularly those unfortunate people who have no relatives to care for them, or who have been turned out by their relatives. They should not be obliged to enter money-making institutions conducted by people who are operating with the assistance of the government subsidy and payments from registered organizations. If my proposal were adopted, many old people could pass their declining years much more happily than is possible under present conditions. It would be interesting to ascertain how many of the people who run homes with the assistance of the government subsidy, comply with the requirements of the taxation law. I suggest that the Commissioner of Taxation should examine them, because they do not spend the money they receive from the inmates on food and comforts for them.

Many of these institutions do not give the aged and infirm inmates the attention that they require at night I know that some institutions do not even have nurses in attendance at night, because the patients are told that they must be able to look after themselves. This fact may be verified. I have been wondering about” the kind of services that are provided in return for the payment of from £9 9s. to £1S 18s. a week. When the treatment of our aged and infirm people is compared with the favoured treatment extended to wealthy companies, I do not wonder that the old people are in revolt against the Government, and the budget. I feel that the people, when they are given the opportunity at the general election next year, will return the Labour party to office. That action will herald the return of sound administration.


.- Several honorable members have asked me to discuss the activities of the Public Accounts Committee instead of making the usual kind of review of the budget proposals of the Treasurer (Sir Arthur Fadden), and, therefore, I crave the indulgence of honorable members while I outline some of the work of the committee and its plans for the future. Before T do sp, I should like to add my tribute to those already paid by previous speakers on this side of the chamber to the Treasurer for his budget proposals for the current financial year. This budget is a noteworthy document for several reasons. I have particularly in mind the extraordinary number of concessions that are to be granted, and the extraordinary amount of tax reductions to be made. If a commercial firm were able to reduce its income, increase its expenditure, and still pay a dividend to its shareholders, its achievement would be somewhat remarkable. But the Treasurer has accomplished that feat in this budget. He has announced a reduction of total income, and an increase of total expenditure, yet he has been able to provide all the benefits that he has mentioned in his budget speech.

  1. do not propose to examine the budget in detail, because that ground has been covered again and again by honorable members on both sides of the chamber. I merely wish to say that any one who desires to obtain an idea of the extraordinary number and character of the reductions has merely to read the Treasurer’s budget speech, and he will find that those matters are clearly set out in the space of one and a half pages. It is a great relief to honorable members on this side of the chamber that a budget of this kind has been introduced. We all are well aware of the difficulties that the Government has experienced during the last five years, and realize that the Treasurer has not had an easy task in meeting them. This Government, when it assumed office, was robbed of the opportunity to do all the things that it had in mind by fortuitous circumstances over which it had no control. There was the war in Korea, the inflation, and the disastrous shortage of essential goods. The pent-up volume of demand and the very serious shortage of goods, which were the products of World War II. and the post-war period, accelerated the inflationary conditions that had begun to reveal themselves in the previous few years. In addition to those factors, high prices for wool provided an immense income from abroad, and there was not a corresponding increase in the supply of goods. All those factors contributed to make the task of the Government extremely difficult.

The Treasurer adopted various countermeasures in order to solve those economic problems. Most of us disliked some of them at the time, but all of us now realize that they had their place in the scheme of things. I pay a tribute to the Treasurer for his courage in adhering to the policy that he believed to be right. The task of the Government was not made any easier by the activities of certain State governments. An endeavour was made to raise the standard of living, and at the same time reduce the working week. It was an egregious mistake in timing to seek the one without taking into account the other. Such a blunder was committed by the New South Wales Labour Government, whose action in introducing the 40-hour week distorted the whole economy, and made it impossible for any other government to break clear and put into effect a policy calculated to restore economic stability.

The honorable member for Shortland (Mr. Griffiths) has mentioned that hospitals have difficulty in obtaining sufficient staff for their purposes. I remind him that many hospitals have found it impossible to continue since the introduction of the 40-hour week. The explanation is that hospitals cannot be run with the price structure that was caused by the 40-hour week. For the same reason, the whole education system is impoverished. Honorable members are well aware of the effect of the price structure on the finances of the .railway systems of the States. We also bemoan the degree to which the finances of the PostmasterGeneral’s Department have been affected. The prices of goods and services have increased to such a degree that our whole economy has been seriously effected.

This is the first occasion on which the Government has been able to return to liberal principles. This budget sets out. to encourage the businessman, foster thrift on the part of ordinary people, and honour the legitimate expectations of people who have given of their best and yet have been facing all the difficulties that we have been discussing in this debate. The budget assists to alleviate the rigours of the means test, and, in so doing, will help every section of the community. I am hoping that one statement made by the honorable member for Shortland will prove to be true. He said that this kind of budget will win an election. Indeed, he has complained that the Government has formulated this sort of budget with that object in view. I agree with him that the budget will win the next general election for the present Government. I hope, too, that this budget will make it possible for us to return to liberal principles of public* finance, and instead of doing all the things we have disliked doing for several years, we may be able to do the things that we believe in, and like doing because we believe in them. I do not desire to discuss the details of the budget because they have been thoroughly examined by previous speakers, yet they can well bear repeating. I hope that the good features of the budget will be repeated again and again until the advantages of it are reflected throughout the community, both in the attitude of the people and in the capacity of the Government to do the things which it set out to do.

With that introduction, I turn to the main reason for my participation in this debate. As I have stated, I have been asked by several honorable members to speak of the activities of the Public Accounts Committee. To that subject, I now address myself. Honorable members will recall that this committee began to function less than a year ago, and, therefore, if I may say so, it has not yet been able to cut its second-year teeth. But I feel that even though it has only its milk teeth, it has shown by its activities that it already has some bite. It has been able to chew a lot of things over, and has shown a good deal of the spirit of abstinence in its refusal to be more biting in its reports. Four or five more reports will be prepared and presented to the Parliament in the course of the next fortnight or three weeks, and I should think that those reports will be a little more generous fare for the consumer and at the same time test the digestive organs of honorable members when they read the documents.

I am sure that honorable gentlemen will be very interested in the extraordinary range of activities that the Public Accounts Committee has already been able to cover. The duties of the committee are set out in ‘ the Public Accounts ‘Committee Act, and I suppose that every honorable member can recall them. If some honorable members have forgotten the details, they will find a reference to them in the third report of the committee. Those duties are, briefly, to examine the accounts and statements that are audited by the Auditor-General, and to report to both Houses of the Parliament * any comments which, in its opinion, should be submitted to the Parliament about the nature of the accounts. The committee is also required to report to the Parliament on any alterations which the committee considers should be made in the public accounts. Lastly, the committee may deal with any matters that are referred to it by the Parliament. Honorable members will appreciate the extent and, at the same time, the limitations of those duties.

Before I proceed, I shall remind honorable members of the composition of the

Public Accounts Committee. It consists of four members of the Liberal party, two members ‘of the Australian Country party and four members of the Labour party. Those gentlemen were nominated by their respective parties, and their appointments were approved by the Parliament. The members of the committee paid me the compliment of electing me their chairman, and Senator Byrne is the vice-chairman. So we have the chairman from the House of Representatives, as is right I think, and the vice-chairman from the Senate, which I think is justified by the place of the Senate in the parliamentary scheme. There are seven members from the House of Representatives and three members from the Senate, an arrangement which provides the sort of balance that the act was intended to achieve. The original proposal to reestablish the committee encountered a great deal of criticism, on the ground of the proposed duties and composition. An attempt was made to prevent its reconstitution because critics thought that it would not have the authority that the United Kingdom public accounts committee exercises. Almost a year elapsed before the Opposition decided to agree to the re-establishment of the committee, which, ultimately came into existence at the end of 1952, and commenced its activities early this year. Honorable members who have attended meetings of the committee and observed its work must admit that any fears that may have been entertained by the former critics have been dispelled by the way in which it handles its job. I say with perfect confidence that the committee has functioned as a team. It has become fused and is developing into an effective agency which will achieve the purpose that it was intended to achieve. That is a notable accomplishment.

The development of the committee system may well provide a means by which this Parliament may make the best possible use of the services of honorable members and senators who do not sit on the front benches on either side of the two chambers. The abilities of such members are frequently unused under the present parliamentary system. I imagine that there is a useful place in the scheme of government for joint committees to deal with every major function of government. By making it possible for groups of members of this Parliament to meet at round tables as joint committees, we can mitigate something of the intransigance of partyism. That obstinacy which leads to opposition just for opposition’s sake, disappears under such conditions. It has never manifested itself at meetings of the Public Accounts Committee. I believe that in this way we may find the answer to many of the problems that beset us under the party political system. I shall not discuss this theme at length. I merely express my view in order to indicate what may be done in the future.

Honorable members will appreciate the limitations that are placed upon the functions of the Public Accounts Committee by statute. The committee deals with the public finances after all the transactions have been completed. Therefore, its inquiries are in the nature of post-mortem investigations. One of the problems that the committee faces arises from the fact that it deals with events after they have occurred. We inquire into decisions that were made perhaps two years ago, and we are not in a position to appreciate the atmosphere in which they were made. We call upon witnesses to justify their actions long after the circumstances that prevailed when the actions were performed have changed. We try to be just in our summing up, but honorable members will realize the magnitude of our difficulties.

Emergencies demand prompt action. But emergencies disappear, and a year or two later people wonder why on earth they acted as they did at the time of the emergency. Sometimes they realize that what they did was the wrong thing to do. It is difficult to blame the victims of such circumstances because, when they acted, they followed the only course of action that seemed to them to be right. We should give them credit for their courage in making prompt decisions, whether the decisions were right or wrong. The committee has imposed upon itself one limitation in addition to those that are imposed upon it by the Public Accounts Committee Act. I hope that honorable members will have an opportunity to discuss this matter on a later occasion when the committee presents a report to the House and that they will consider whether the limitation is legitimate. The committee decided at the outset that it would not have anything to say about Government policy. If the Government decided to build hothouses in Canberra in order to grow tomatoes, the committee would not have anything to say about the decision. But when the accounts were presented, the committee would examine the cost of building the hothouses and would consider whether the administration was efficient, whether the purchase of supplies was economical, and whether the results achieved were satisfactory. Those are matters that the committee can legimately consider and criticize. Therefore, it will criticize the administration of policies but it will keep clear of any reference to the wisdom or otherwise of Government policies. T hope that it will always do so.

That is the main limitation that the committee has imposed upon itself. There are, of course, the statutory limitations, but other factors must also be borne in mind. For example, the Parliament has established agencies to carry out various ‘ jobs on its behalf. The committee is concerned with management. Management covers the way in which accounts are kept and the results of account-keeping. Three agencies of the Parliament operate in this field. They are the AuditorGeneral, the Public Service Board and the Treasury. Each has its own specialized field of activity. Fortunately, the Public Accounts Committee has been able to secure the co-operation of these instrumentalities so that the AuditorGeneral, or his representative, officers of the Treasury, and representatives of the Public Service Board attend its meetings. They are able to help us out of difficulties. If, for example, the committee becomes confused by information supplied to it by departments, the representatives of these authorities can indicate to it what has happened and what is being done. Bearing that in mind, the committee does not intend to undertake such detailed inquiries as these agencies engage upon. For instance, it would not try to embark upon such detailed investigations as the Public Service Board would carry out under section 17 of the Public Service Act. The committee would not be able to say authoritatively whether there ought to be more men or fewer men employed on any project, or whether the degree of organization for an undertaking was adequate or inadequate. However, it forms its opinions acquired from its impressions. Because impressions influence the opinions of members of the committee, we may say that, on .the evidence submitted to us, we do not think that this should be done but that something else should be done or we may suggest an investigation by the appropriate authorities.

We are not making investigations in order to determine the proper methods to employ, and we are content to ask the Public Service Board to make the necessary investigation for us. Similarly, the Auditor-General is concerned to make sure that the public servants handle the accounts with the necessary integrity. His certificate covers both honesty and regularity. That is, he has the duty of making sure that money is used for the purpose for which the Parliament provides it, and that only the amount appropriated for any specific project is expended on that project. The committee does not cover the ground that the Auditor-General covers. It asks him for reports on specific matters and also studies his annual report. However, it goes a little further than he goes and, where he is concerned with honesty and accuracy, it pursues its inquiries in order to determine whether departments are getting the best value possible for the money that they expend. We consider their activities in that light and try to evaluate the results that they obtain so that we can determine whether the Government obtains the best results from a given kind of organization and a given amount of expenditure.

Sitting suspended from 5.55 to S p.m.


– Prior to the suspension of the sitting, I discussed the attitude of the Public Accounts Committee to the work that is being done in their field by other agencies. I want to emphasize that our aim is to enhance the power of the Parliament to do the job that it should do, that is, to control the purse, and to strengthen the hands of Ministers in their relations with the Public Service. We had hardly commenced our work when we became convinced that the procedure of the Parliament did not lend itself to effective discussion of the budget, and we were at some pains to examine officers of the Parliament and others in order to decide whether the impressions that we had formed of parliamentary procedure were correct. We realized that, in formulating a proper procedure, we had to deal with the Estimates and the budget papers, because it was important that the Estimates should be comprehensive and clear, and should provide the Parliament with material for a proper discussion of the budget. It would be useless to alter procedure if we did not alter the form of the Estimates. So, for some time, the committee has been engaged in a consideration of the form of the- Estimates. We are not by any means hopeful that we shall be able to change the procedure and the form of the Estimates overnight. We shall be content if the views that we present to the Parliament receive what I have always referred to as intellectual hospitality and are considered in an atmosphere of benevolent tolerance to the introduction of new ideas. Honorable members who have been elsewhere to-night will recall the discussion of the difficulty of obtaining receptivity for new ideas.

It will be found that we suggest that when the Parliament is dealing with the budget, it should deal with high financial policy. I venture to say, without wishing to be offensive to honorable members, that not half-a-dozen of the speeches delivered in the course of this debate’ dealt with the principles of the budget. Most of the speeches dealt with something else. We want honorable members to deal with the budget when the budget is under consideration. When they are dealing with the Estimates, we want them to deal with the way in which government departments are expending money allocated to them and to consider whether the allocations are sufficient to enable the departments to do the jobs that they should do, and whether they are doing those jobs properly. Those are the subjects that we believe should be discussed when the Estimates are under consideration. In dealing with the financial measures to give effect to the budget, we should engage, not in another budget debate or another discussion of the Estimates but in an examination of the provisions of those measures with the object of deciding whether they will accomplish what the Government has set out to do. If our proposals were adopted, certain periods would have to be allotted for discussion of the budget, the Estimates and the financial measures. We think that probably that would involve a strengthening or tightening of the Standing Orders to ensure that irrelevancies were not discussed and that only things that were important were dealt with. We do not wish to interfere with “ Grievance Day “ debates, because we believe that such opportunities for discussion, should, be made available to honorable members. “ft may be that the committee is too ambitious, but we hope to present our proposals to the Parliament. At first, we considered presenting them to the leaders of the various parties and discussing them with the leaders, but now we luke the view that it may be worth while to present a draft report to the House and let the House take whatever action it deems necessary, through the Standing Orders Committee. Possibly the committee has been too ambitious for another reason. It may be that the Parliament is no longer interested in controlling the purse, and is much more interested in spending. It may be that it has a zest for spending, with the prizes in the electoral lottery going to those parties which promise to spend or give away the largest amounts of the taxpayers’ money. If it be too ambitious to expect the Parliament to be interested in controlling the purse, let us hand ourselves over to the bureaucracy at once and talk, not about the Parliament and the democratic system, but about the managerial state.

Let me turn to the question whether the work that the committee has done up to the present will achieve any worthwhile result. Whenever we have anything to say, we propose to make a report to the Parliament. We have made an arrangement with the Treasurer that, when we present a report to the Parliament, we shall send a copy to him. The Treasurer has given an undertaking to inform us of any action that he takes as a result of the report and of the efforts that will be made to ensure that effect will be given to the committee’s suggestions. The reports will not be pigeon-holed. The Treasurer will take the action that he considers to be necessary and will inform us of what he has done. When we have received his account of what he has done, we shall print it in our next report, so that the Parliament will know the degree to which lie has given effect to the recommendations that the committee has made.

We do not think that we shall be able to do more than clear away some of the weeds - I do not think that is an unjust expression - which grew in the departmental preserves in the years during which there was no external investigation of what the Public Service was doing. lt is time that such an investigation was made, but we do not believe that we shall be able to do more than to clear some of the weeds. It may be that we shall stimulate efforts to improve the official husbandry, but we shall not be able to change the departmental landscape. If the Parliament wants to change that, it will have to look elsewhere. Such a change would necessitate a review of the distribution of powers and functions between federal authorities, State authorities and local authorities. Without a rational redistribution of powers and functions, it would be useless to talk about cutting down expenditure. We should only be beating the air.

The Leader of the Opposition (Dr. Evatt) suggested the establishment of an estimates committee. I agree that there ia room in the Parliament for such a body, but I warn honorable members that if we start to talk in those terms, we shall have to talk also about ministerial responsibility in a. system of cabinet government. I doubt whether any cabinet would permit a parliamentary committee to determine what it should spend. Yet, there is no doubt that the Treasurer needs to he fortified if he is to withstand the forays that are made by his colleagues upon the Treasury chest. There is room for ad hoc committees such as the Select Committee on National Expenditure, to consider both policy and practice, and attempt a systematic overhaul of the .whole governmental organization.

The committee is gratified with the support it has received from the Parliament, the press and the public. It is too soon to express definite views about what it is doing, but, provided it continues to receive the co-operation of the government departments and the support of the Parliament, it may be able to contribute much to the preservation of Parliament in a system of responsible government.


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


.- I intend to deal with the budget in general terms, somewhat on the lines adopted by the Prime Minister (Mr. Menzies). My colleagues who have preceded me in the debate have literally cut the budget to ribbons. They have taken it apart, analysed it, and proved by facts and figures that it is a rich man’s budget. The wealthy people, the followers of the Liberal party, have received the juicy plums, the followers of the Country party have had a little chicken feed, and the followers of the Labour party have had nothing but the crumbs from the rich man’s table. That is the interpretation that must be placed upon this budget. That fact has been demonstrated by my colleagues, and I do not intend to enlarge upon their arguments to any great extent. Never did any Australian budget get so much bally-hoo - if you will pardon the use of an American word, Mr. Chairman - from so few as this budget has got. The press, apparently with plenty of information about it, broke into pagans of praise of the Government, rising to a crescendo. But, although the mountain went into labour, it brought forth only a mouse.

Let me take honorable members to a palatial residence in Sydney. There we find two ladies and two gentlemen at dinner. They are the Prime Minister and his good lady, and Davey Jones and his good lady. The Prime Minister and his lady are the guests, and the other lady and gentleman are the hostess and host. Dinner finishes, and the ladies leave the dining-room. The host produces a bottle of Scotch. After the flavour and bouquet of Scotch has been tested, people are inclined to become genial Davey, looking at Robert, says, “Robert, you have improved Scotch whisky “. That is a shock even to the Prime Minister, with his tremendous ego, but, being a great Shakespearean actor, he dwells for a little upon that remark. Then he says, “ In what way did I improve Scotch whisky, Davey?” Then Davey says, “You brought down the price”. The reduction of the excise duty on whisky by 21s. a gallon is the great achievement of this budget. I suppose that that reduction represents the most drastic cut in the duty imposed on any article. Let us leave the gentlemen to finish their bottle of Scotch. We shall come back to them later.

The wealthy people who support the Government have had very rich helpings from the public purse. I agree with every word that has been said by my colleagues about the treatment of war widows and age pensioners. Owing to the decrease of the purchasing power of the £1, the?’ people will receive nothing under this budget. I shall not elaborate on that matter because my colleagues have already dealt with it thoroughly. I intend to deal with other subjects.

The reductions of sales tax and income tax provided for in the budget constitute one of the greatest sleight-of-hand tricks possible. A certain gentleman is serving ten years in gaol now for something similar. What happened was this-


– Order ! If the honorable gentleman is levelling imputations at any honorable member he wilt withdraw his statement.


– Withdraw what?


– The imputation that the Treasurer is guilty of an action that would merit a term in gaol.


– Whatever it is I shall withdraw it. When the Government came into office it imposed heavy income tax and extraordinary sales tax. Now it has produced a budget that it claims to be an election winner. It boasts that it is relieving the people of some of the heavy sales tax and income tax burdens that it imposed on them in previous years. It claims, in fact, to be giving the people something. That is definitely a sleight of hand trick. Any government which hypnotizes the people in an attempt to make them believe that it is giving them something, when all it is doing is to return to them something that it has already taken from them, is adopting the practices of a confidence man. Some of the Government back-benchers who were so hopeful when the ballyhoo about the benefits of the budget first started are beginning to wonder where they are since the budget has been exposed by the Opposition for what it is. Members of the Australian Country party are certainly realizing now that the primary producers will derive little benefit from the budget. Of course, the big boys are very satisfied. They knew what they were going to get, and they have got it. The workers whom we on this side of the chamber represent are not happy, however, because they will not even get chickenfeed. All they are to get are the crumbs from the rich man’s table. Talk about bribery and corruption ! Members of the Government and sections of the press claim that the budget will win the next general election for the parties now in office. They say, in effect, “ We shall huy the votes of the electors “. They do not say that the budget has been brought down in the interests of Australia or for the good of the people. They do not say that it is designed to develop industries or to carry out other essential tasks or to assist our defence. The only chorus has been all along, “ This is an electionwinning budget “. I do not know that such a thing has ever before happened in the history of Australia.

The budget is another example of ballyhoo of the kind that is imported from America. I wondered where the present ballyhoo technique was picked up, but I know now. The Prime Minister visited America on several occasions recently. He promised later that he would make a report on the important matters that he had dealt with, but so far we have had no report from him. I suspect him of learning the American ballyhoo method and using it in order to boost this budget. The figures that the Government produces in order to buttress its claims about increases of pensions ignore entirely the depreciated value of the Australian fi. The same applies to its claim regarding the assistance it has given to the States. The Prime Minister and the Treasurer tell us how many millions of pounds they have given to the States. The figures are impressive and are probably higher than the amounts given in the past. In actual purchasing power, however, the States and the pensioners are receiving less than they received in the past. The cost of materials and the cost of living have risen. The depreciated value of money should be taken into consideration in relation to grants to the States, so that the State governments will receive the amount of money they require and to which they are entitled. Queensland, for instance, requires finance for important works. Housing is one of the most important matters that must be tackled if we are to have a happy and contented people living in civilized conditions. Surely people in Australia are entitled to such conditions. Therefore, we must provide good homes for them.

Education is one of the most important factors in the life of the community. It ranks next in importance to food, clothing and shelter. But education costs a lot of money. I was Minister for Education in Queensland for a number of years, and I know the expenses that attach to the conduct of an educational system. I know the heavy cost of building and maintaining schools, paying teachers, providing transport for school children and providing the other educational facilities required in any community that aspires to be up to date. Education can mean the salvation of a country. I believe that education in Queensland, arid, in fact, in Australia, is of a higher standard than education in many other parts of the world. We often hear about high educational standards abroad, but I notice that immigrant children are keen to be educated in this country, a fact which seems to indicate that they have not had the same opportunities in the countries from which they came. Education could be the basis of sound legislation, of broad vision and of a truly national outlook. It would enable the people to ensure the progress of this wonderful country in which we live. Australia is one of the richest and most generous countries in the world. Brawn and determination are required in addition to education, because education will not do the whole job alone, if we wish to develop this nation as it should be developed.

The next most important need of the community after food, shelter, clothing and education is hospital treatment. Tremendous costs are involved in the erection, staffing and conduct of hospitals. The work of hospitals has increased as a result of our part in two major wars and in the war in Korea. There are still many men from the two world wars and the war in Korea who require hospital attention. In addition, the needs of the ordinary community have to be met. Hospital treatment is becoming more necessary in the community than ever.

It is the duty of every Australian to assist in the development of this country. Roads and railways are absolutely necessary for our development. As honorable members know, roads and railways are the responsibilities of the States, although it is admitted that the Commonwealth has advanced certain money to assist the States to carry out their responsibilities. Unless we open up the country areas we shall not be able to develop Australia as it should be developed. I represent a distant area in which, I say without hesitation, 5,000,000 people could be settled without crowding one another, and all of them could make a living. The Government, however, far from engaging in development, is removing equipment from that area. I asked a question this morning regarding the projected removal of a telegraph line, and I have asked other questions regarding similar actions by the Government in Queensland. My questions arose from the fact that the Government has apparently decided to salvage public facilities and sell them. Anybody would think that the Government was on the verge of bankruptcy and had to sell every- . thing it owned to get a few shillings.

People in the area to which I have referred live in hard conditions, but they are doing a mighty job. Everything possible should be done to assist them. On the contrary, however, aerodromes that are vital to our defence are being closed. I want to say now that the PostmasterGeneral (Mr. Anthony) has been very thoughtful in regard to the outback country, yet we have this case of the projected sale of an existing telegraph line. The Government suggests that the line, and the iron standards on which it is strung, should be salvaged and sold. It will have to dynamite the standards out of the ground, and they will probably cost more to salvage than the Government will receive for them. Many things are required for development, but roads are the main need. I believe that, whilst railways should be the main projects, roads can be more quickly built and can more quickly open up the country and give people access to rich areas that offer a living to whole families. I was Minister for Works in control of main roads in Queensland for a number of years, and we had no trouble in getting the necessary money, men and materials. That was during the economic depression. We did not have big road-making machinery such as is in use to-day. We built thousands of miles of roads by the use of only picks and shovels, powder, motor trucks and a few scoops. The bulldozer was not known in those days.

We talk about the old pioneers. When I became Minister in charge of main roads in Queensland, my view was that it was my job not to talk about the old pioneers but to carry on the work that they had begun, and develop the country. There are honorable members here who can say what the main roads meant to the south-western areas of Queensland. Roads put them right on top of the world. Land that was worth 15s. an acre is now worth probably £15 an acre, simply because these roads were put in. That more than ever emphasizes the necessity to open up this country. About twelve months ago there were public complaints and much press comment about a drought that occurred in the far north, of Queensland and the Northern Territory. Many years ago it was proposed to build a railway line from Dajarra to the Northern Territory. Of course, Queensland could not be expected to undertake such a work, but I suggest that the State and the Commonwealth in co-operation should now do something about building such a railway line because it would be of immense value in opening up the country, and would also save large numbers of stock in time of drought. As far as public works are concerned in the north of Australia, we are at present at a stand-still. Nothing worthwhile is being done, and I believe that that condition has been largely caused because the Common-wealth has not made grants to the States commensurate with the depreciated value of money. At present, all costs of construction should be considered in the light of the fact that our money is now worth much less than it was. I hope at a later stage during this sitting to be able to speak to honorable members further about this matter, and also about the wealth that is available to us on our continental shelf.

When uranium became important to the world, our professional geologists discovered with surprise that there were vast uranium deposits in the Northern Territory. They also discovered many basic ores. The old-time prospectors knew that 70 years ago. They knew that ore deposits stretched throughout the country from Cloncurry through the Northern Territory and across to Western Australia. Indeed, there is no reason to believe that the ore belt stops at the artificial boundary between the Northern Territory and Western Australia. I suggest that the geologists should be earning their money, and not telling us something that we knew 70 years ago. We knew that uranium was there, but we did nothing about it because uranium was of no value until the atom was split and the importance of atomic energy realized. Last year the Mount Isa mining concerns won £2,600,000 worth of minerals. Mount Isa is pro,ducing silver, lead, copper and zinc, and its annual output of copper is about 25,000 tons. In that area tin, wolfram, molybdenum, tantalite, copper and almost all the minerals known to man may be found, and yet the country is absolutely desolate. No public attempt has been made to open it up, and no facilities have been provided to attract private individuals to go there and open up the country. We are often warned about our Asiatic neighbours, but we in Australia are still living in a fool’s paradise because otherwise we would bend every effort to the development of our empty spaces, particularly those in the north. Because the Australian Government is the main taxing authority in Australia most of the blame for that situation lies at its door. I know that the Government has greatly assisted certain secondary industries, but those industries are not playing their part by providing the machinery and the material needed by primary producers to develop the country.

My electorate extends from Innisfail to Thursday Island, but if it were not for the sugar industry the whole of northern Queensland and much of the south would still be uninhabited. The sugar industry is the foundation of Queensland’s economy, but I suggest that the tobacco industry could be developed along similar lines, and in time that would give stable and continuous employment to many people, open up the country and enrich the .State. It has come to my- notice that on a farm on Cape York a family has been growing rice for some time, and has been selling it mainly to natives. I mention that to show that rice growing is a possibility in that area. Only a few days ago another farmer in Hot Springs got £294 worth of cotton off three acres of land. He intends to plant bigger areas next year, of course, but why should an individual with limited capital, and under great difficulty, have to experiment with a crop like cotton when the Government has all the necessary technical experts and finance available to carry out experiments for the good of the whole community.

I believe, with every other honorable member in this chamber, that Australia should be adequately defended. However, we should realize that we must increase our population and our industries, both primary and secondary, before we can properly defend ourselves. That sort of development should certainly take place in our north. While on the subject of defence, perhaps I should tell honorable members that I have requested the Minister for the Army to have air force personnel trained at Mareeba, from which they fought the Japanese in the last war. I have asked him to do that so that they will be trained in an area that they will have to defend if we are again attacked.


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

Mr. McMAHON (Lowe- Minister for

For at least eighteen months I have watched the honorable member for Leichhardt (Mr. Bruce) slumbering peacefully in his seat in the corner, and I never expected to see him on his feet making a speech.

Mr Bruce:

– Sleep, gentle sleep, nature’s sweet restorer.


– I did not think that he would highlight as the most important feature of the budget the 2ls. a gallon reduction of excise and customs duty on spirits. He said that was the first point he wanted to make, and that it was one of the most important features of the budget. To the honorable member it might have been the most important, but to the Government it was the least important; he touched only superficially the main features of the budget. As the honorable member for Warringah (Mr. Bland), who is learned in the theory of government and budget control, has said, when a budget is being discussed let us find out what its principles are. I was- glad to hear the honorable member for Leichhardt say that he intended to adopt the same attitude, but unfortunately he wandered off to the local problems of the Government of Queensland.

Let us consider the principles upon which the Government has framed its budget. Let us see what it sought to achieve, how it sought to achieve it and whether it has reasonable prospects of achieving its purposes. Any person who has listened to the speeches of the Prime Minister (Mr. Menzies) and the Treasurer (Sir Arthur Fadden) will admit that the Government has done a very good job, and that the probabilities are that this budget has good prospects of being successful in achieving what it sets out to do. However, it is wise to consider these matters step by step, so that the committee may then be asked to judge. Of course, “the people will be the final judges. In 1950-51 two critical economic problems faced this Government. The first was how to combat inflation, and the second was how to increase production. By 1951 the danger of communism had been temporarily brought under control, and those two major problems remained to be dealt with. Another problem that would have been solved automatically if the first two major problems were solved was how to increase contentment throughout the country and provide a higher standard of living for all our people.

The biggest economic danger facing Australia in 1951 was uncontrollable inflation. Inflation was dangerous for many reasons. It tended to destroy the savings of the people, and their confidence in Commonwealth “ bonds and in the Commonwealth Savings Bank. Inflation also distorted the structure of production because it turned the emphasis onto the less essential side of production. It had various other effects as most honorable members know, which I shall not elaborate at the moment. Above all things inflation caused discontent and uncertainty in the minds of the people. That caused many to work inefficiently or discontinuously. In the last years of the last Labour Government the C series index was rising at the rate of about 10 per cent, per annum, but as a direct legacy of the policies of that Government the index shot up ‘ suddenly in the first complete year of this Government’s regime by 19 per cent., and in the second year by 20 per cent. By last year, which was the first effective year of this Government’s term of office and the first year in which results could be shown of what the Government had done, the C series index increased by only 4 per cent., and, more importantly, the wholesale index did not increase at all. That was a very favorable sign, because it indicated that as the result of the Government’s action, and as the result of the people’s achievements inspired by the incentive provided by the Government, inflation had been brought under a reasonable measure of control.

The Leader of the Opposition (Dr. Evatt) has said that he does not agree that our economy has been stabilized. Last Thursday the Prime Minister put before the country a case that was not so much pursuasive as conclusive. He quoted statements, not from people that one would normally expect to support a Liberal government, but from those who would normally be expected to support the Labour party. He quoted statements approving the policy of this Government from authorities in the trade union movement, from counsel acting for the trade union movement in the recent wages and hours case before the Commonwealth Court of Conciliation and Arbitration, and from the Premier of New South Wales, who last night went to great lengths to extol the virtues of the policy of the Menzies Government. Honorable members have heard about these matters in this chamber in the last few days, so I shall leave aside Mr. Cahill, the Premier of New South Wales, the Australian Council of Trades Unions and other Labour witnesses to the effectiveness of the Government’s policy and performances, and turn to one objective source, a source that has hitherto been proved to be reliable so far as forecasts are concerned. In the report of the Commonwealth Bank of Australia, published only a few days ago, the following state ment appears: -

The year under review thus opened against a background of uncertainty. Hesitancy continued until towards the end of 1952 and some unemployment occurred, although it quickly became apparent that there was little danger of a. major decline in activity. Since then there has been a steady improvement in the tone of the economy and employment is now at healthy levels.

This is an important fact because it indicates, not the contemporary state of affairs or what has happened in the past, but what the Commonwealth Bank thinks will happen in the future. It indicates trends which can be traced to the actions taken by the Government and for which it should be accorded the fullest credit. The report continued -

Aggregate demand of consumers, businesses and governments is adequate to maintain this level of employment, and appears to be within the range of available supplies. The inflationary pressure characteristic of earlier years has, therefore, been relaxed and prices arc relatively stable.

There we find, I think, positive evidence of stability, first, in the actual change of price levels and, secondly, in the objective views of the Commonwealth Bank of Australia submitted in a report to the people. Other things have happened during the last few days that give greater hope that not only have we achieved stability, but much more importantly, that costs will fall. I mention first the action of the Commonwealth Arbitration Court in abolishing quarterly adjustments of the basic wage. Most honorable members deep in their hearts admit that quarterly adjustments of the basic wage constitute the most unscientific method of adjusting wages in time of violent changes. That method feeds upon itself and is cumulative in effect. It is not related to production and it merely accentuates the effect of past changes. Every sensible citizen will welcome the decision of the court to abolish the quarterly cost of living adjustments. Other action was taken which will, perhaps, result in a reduction of the cost of living. A few days ago the Prime Minister announced, that the Government intended to relax import controls. That decision wa3 taken for various purposes. Initially, import controls were imposed to protect our overseas balances and London funds; but it was found that at a time of stress they also provided protection for Australian manufacturers. Australia is a great trading community. Last year we exported goods worth more than £900,000,000. We cannot hope to trade unless we purchase the goods of other countries. If we sell to them, we must also buy from them in order to enable them to purchase our products. So, we have a duty to relax import controls when the opportunity to do so is presented to us. The relaxation of import controls also provides that necessary competition which puts Australian manufacturers on their toes and gives us an opportunity still further to control living costs and perhaps to reduce costs and prices. There are reasonable prospects that the costs may fall and that this great problem can be conquered.

The Government does not want to create the impression that that is the end of its task. To use a term favoured by economists we have a “ scissors “ crisis. The scissors are open; costs are going one way and international prices are going the other. I have not in my possession and I do not know whether it is possible to procure a scientific survey of the extent, to which our costs have got out of line with costs in other parts of the world. Comparative figures are not readily available. Recently, however, the Tariff Board held an inquiry into the cost of production of carpets and floor rugs. The board came to the conclusion that for a light industry of this kind, which it said to be highly efficient, a tariff protection of approximately 20 per cent, is necessary in order to bring the prices of Australian carpets into line with carpets imported from the United Kingdom. That is an illustration of the extent to which our costs have gone out of line with costs in light industries overseas. Other factors, such as wage rates and international price comparisons, must be considered. I have these figures and can make them available if they are wanted. I stress the point that the Government recognizes that one of the great problems that faces his to-day is the problem of the high ^plateau of costs. The Government has set out’ to conquer it. The Treasurer very well expressed the Government’s determination to do so when he said in his budget speech -

The joh is not wholly or even mainly one for the Government. But the Government can give a lead in this matter and make a contribution.

The honorable member for Leichhardt spoke of the gentleman of his era who worked with the pick and shovel and did the job. The job is one for US-to tackle and we shall tackle it.

I commenced my speech by asking what were the principles on which the budget was based. The Government has looked at the problem of costs and has sought a solution of it. The Treasurer outlined the principles and the means by which we propose to attack it when he said in his budget speech -

From its study of the general problem the Government is convinced that the right course at this juncture, and the best contribution it can make to the solution of the current problems of our economy, is a bold policy of reducing taxes - particularly those taxes which are levied directly upon individuals and upon business. We believe that this is the best form of assistance we can give in the attack on costs. Essentially the cost problem is one to be solved by greater efforts and greater efficiency on the part of both labour and management.

By reducing taxation, particularly by reducing the general average of income tax by 12$ per cent., and by reducing the general rate of company taxation by 2s. in the £1 the Government hopes to make a substantial contribution to the solution of this contemporary problem. We believe that by giving individuals more to spend we will give them the necessary incentive to work harder. We believe that by providing tax relief for companies, which provide the means of much employment in this country, industry will be able to increase production and plough back additional profits into machinery and the other things that are needed to expand their activities and make them increasingly efficient. The Government is confident that this budget will achieve much more than did the last budget. I hope to be able to prove in a few moments what great advantages flowed from the budget of last year. We confidently expect continued improvement.

We realize that we shall have to face the mammoth problem of high costs but we think that by realistically tackling the problem, particularly by giving incentives to individuals and corporations, wc shall bring about beneficial results. I hope that there is no unnecessary worry in the community about the problem of costs. We do not want any one to panic prematurely. It is significant that in many instances by natural processes a problem cures itself. We are aware of the existence of this problem and we believe we have taken realistic action to deal with it.

The second great problem that confronts us is that of production. I have already said that this budget provides a challenge to businessmen to increase production and to produce more efficiently at lower costs per unit of production. If we look at the facts and figures we must be prepared to admit that during the term of office of this Government production has increased significantly and it is continuing to increase. The most significant figures in this connexion are contained in the statement of national income and expenditure presented by the Treasurer with the budget. An examination of the document reveals that a remarkable change has occurred during the last few years. In 1948-49, the last full year of th, Chifley Government’s regime, the national income amounted to £1,958,000,000. In 1951 it increased to £3,250,000,000. Last year it increased still further to £3,579,000,000. In other words, the national income rose last year by 10 per cent., a really outstanding result when one considers what this Government had to face when it assumed office - communism, disorganization of production and industrial problems piled one upon the other. Despite these obstacles, ,the Government was able in its third year of office to increase production by 10 per cent. I readily concede that some part of the increase is due to price rises, but as the wholesale price level did not increase last year it is reasonable to assume that a proportion of the increase was due to the efforts of the people stimulated by the actions taken by this Government in the previous two years. But much more important still are the figures relating to production. Some of them are significant. For instance, the production of pig iron increased from 1.100,000 tons in 1938-39 to 1 ,700.000, in 1952-53. The output of electricity increased from 4,6S8,000,000 kilowatts to 12,289,000,000 kilowatts in the same period. These are spectacular figures. Whilst I do not contend that similar increases took place throughout every sector of the economy, and while thu problem of more efficient production continues, it cannot be denied that we are well on the way to the solution of the worst features of it. The Government believes that one way in which it can solve the problems of high costs and increased production is by a bold policy of tax reductions. Last year we” reduced taxation by £80,000,000 and the national income was increased by about 10 per cent. This year, taxation has been reduced by £120,000,000 and there are reasonable grounds for thinking that with the 50 per centincreased incentive the production records of last year will be bettered. Looking at the Government’s performances, we note, first, the conquest of inflation and, secondly, the near-conquest of the problem, of production. I think that we have the answer to the question posed by my colleague, the honorable member for Warringah, in the first place, and secondly by me. This budget is based on a philosophy and a set of principles. They have been consistently followed in finding a solution to our problems. The principle which we uphold is that of personal incentives and initiative.

I come to the second part of this debate, and that is the policy of the Opposition, and the criticisms that honorable gentlemen opposite have made during this discussion. We must examine the position from two viewpoints. First, we> should ask ourselves whether the Opposition has a financial and economic policy that can be substituted for the financial and economic policy of the GovernmentSecondly, we should try to discover, if we can, whether the Opposition has a philosophy of any kind. I have sat in this chamber for a considerabletime, as have most of my colleagues,, and I defy any honorable member to distil from the oil and waterconglomeration poured out by Opposition members a philosophy or a set of ideals that they can regard as their own. I cannot discover what their policy 1S and I cannot find out what their philosophy is. I challenge any honorablemember opposite, who is able to think, and who has the courage, to state the policy and philosophy of the Labour party in this chamber. It is perfectly true that the No. 1 principle in the platform of the Labour party is socialization

Mr Ward:

– Hear, hear !


– The honorable member for East Sydney (Mr. Ward), who is usually outspoken, agrees with my statement; but I remind honorable members that his own leader has said that the Labour party regards socialism as a dead issue. So we find this oilandwater mixture that will not mix, this difference of view in the Labour party as to where its members stand on philosophy and principles. But much more important to the listeners to this budget debate is whether a single suggestion on economic policy or financial principles can be found in the speech of the Leader of the Opposition. Personally, I cannot discover one suggestion on those matters, and I shall be the happiest person in the world if any one can enlighten me. Opposition members have advanced various arguments in this debate which, as the Prime Minister has shown, do not touch the main features of the budget. Has the Opposition debated the concessions given to the Australian people, and to what extent does the budget let the people retain their earnings in their own pockets to save or spend as they wish? The people are the ones who should be given the choice as to how their income should be spent. This Government believes that, by giving the people incentives, we shall make further progress along the road to prosperity. The Leader of the Opposition did not object to the concessions and all that his chief lieutenant did was to mutter occasionally “ not enough “ or “ it should be more “ when the Treasurer was making his budget speech.

The Leader of the Opposition doubted the Treasurer’s claim about the stability of prices. I have already answered this criticism in this debate. He also touched on two other matters, one of which was dealt with by the honorable member for Leichhardt (Mr. Bruce) regarding pensions and social services, which, I think, should be touched on, however lightly, here tonight. The honorable member for Leichhardt claimed that this was a rich man’s budget. The Leader of the Opposition said that he would restore the purchasing power of pensions to that which existed in 1949. One of the notable contributions to this debate was made by the Minister for Social Services, and highlighted by the Prime Minister. The Minister showed that if we accepted the statement of the Leader of the Opposition literally, a Labour government, far from increasing pensions would reduce them. An examination of the facts and figures shows that if we relate increases to theC series index, which reflects changes in purchasing power, the pension under the scheme announced by the Leader of the Opposition would be £3 8s. 3d., and, therefore, would be a reduction on the amount to be provided under this budget for the pensioners.

I do not propose to touch on any more of those points. Any one who makes a critical examination of the arguments put forward by the Leader of the Opposition will find that his facts are wrong or have not been thoroughly examined, or his logic and economics are deplorably bad. Let us compare the philosophy, policy and action of the present Government with the Labour party’s lack of policy, lack of knowledge of finance, and lack of definite economic principles. This country would suffer a grave misfortune if a Labour government were returned to office, because it would have no policy or economic principles to guide it.

The only other point that I desire tn put to the chamber is this: The argument has been advanced that it might have been better if the Government, instead of reducing income tax and company tax, had made allowance for special depreciation, abolished double tax on company dividends, and abolished the pay-roll tax. I remind honorable members that when the budget was being prepared, the Government found that the maximum reductions that could be made would total £120,000,000. That was a technical problem. The mammoth problem of judgment then arose as to how that £120,000,000 should be split up.We decided that the best way in which to increase production, provide incentives, and get a contented community was by the method adopted and submitted to the Parliament in this budget. I know that our proposals will have the approval of this chamber. Other people have suggested that the amount of £120,000,000 should be split up in another way. Mammoth problems of personal judgment are involved in this matter. Somebody else may have reached a different decision. But the Government holds strongly to the view that what it has done is to provide the sound foundations of a prosperous economy. The other matters mentioned are refinements. If our expectations are realized, we can deal with problems like special depreciation, payroll tax, and matters of that kind in the future. A problem of judgment was involved in the preparation of this budget and, in my opinion, and in the corporate opinion of the Government, the best possible solution was found.


– Order!The Minister’s time has expired.

Port Adelaide

– I was interested a few moments ago to hear the Minister for the Navy (Mr. McMahon) say that he would lightly touch on social services payments.


– I did not use the word “ lightly “.


– The Minister said that he would lightly touch on social services payments, and I agree that he did so. He also deliberately misrepresented a statement by the Leader of the Opposition (Dr. Evatt) about the policy of an incoming Labour government regarding pensions. The honorable member for Sturt (Mr. Wilson) was the first Government supporter to discuss the proposed new rate of pension of £3 10s. a. “week. He referred to the C series cost-of-living figure and said that, under the Leader of the Opposition’s proposal, the pension at the present time would be £3 8s. 3d. a week. The Minister for the Navy repeated that statement a few minutes ago. The Prime Minister (Mr. Menzies) also dealt with that matter. Such misrepresentation of the statement of the Leader of the Opposition indicates that Government supporters are hard-put to justify this budget. In .order to place the position beyond doubt, I shall read what the Leader of the Opposition said. It is as follows : -

In the Chifley budget in 1048 the pension was fixed at £2 2s. (id.

The pledge of the present Government loaders in the 1040 election campaign was expressed in various ways and at various times. For the present purposes it is sufficient to quote one pledge given by the Prime Minister himself. This was that “ existing rates of pension will, of course, be at least maintained. We will, much more importantly, increase their true value by increasing their purchasing power “.

No doubt this was woven in with the promise to “ restore the real value of your money “ on which the election was won. But “however interpreted the obligation at the very minimum was to assure to every pensioner that the purchasing power of his pension would not be reduced.

That is putting it most favorably to the Government which solemnly promised not only to prevent reductions but to actually increase the purchasing power of pensions.

At the time that promise was made, in November, 1949, the wage-

No reference is made to a cost of living “figure - had increased to £6 9s., and it was clearly “the duty of whichever government was elected to make a further adjustment in the pension rate to meet this increased living cost.

The Menzies-Fadden Government recognized this responsibility by increasing the rate from £2 2s. Cd. to £2 10s. in its 1950 budget.

By that adjustment it showed its recognition that justice to the pensioner required at least the maintenance of the standard established by the Chifley Government. .

The Leader of the Opposition proceeded -

To restore the full equivalent of the rate set in the 1948 Chifley budget a further improvement would need to be made.

However, it is clearly beyond doubt that the pledge given to the pensioners requires as a minimum to-day a pension rate of £4 a week and a permissible income of £2 15s. a week.

An examination of the statement of the Leader of the Opposition reveals that he did not refer to cost of living figures or the C series index. His reference was to the basic wage. He has stated that an incoming Labour government will ensure that a pension of £4 a week shall be paid, or the amount adjusted in accordance with alterations of the basic wage between now and the time the. new administration takes office. Every Opposition member who has dealt with this subject has referred, not to cost of living figures, but to the basic w.age.

The Minister for the Navy has stated that the great problem that now confronts us is that of costs. Government supporters have spoken glibly about the costs structure, and have said that we are “ pricing ourselves out of the markets of the world”. If that is the position, the Government should immediately increase social services payments. The Minister for Social Services (Mr. Townley) endeavoured to counter the criticisms of the Leader of the Opposition, who described this budget as the “halfacrown budget”. The Minister said he was astonished that the Leader of the Opposition did not understand the social services legislation and went on to speak of the increased benefits foreshadowed in this budget, which, he said, did not justify the term “ half-crown budget “. I have examined the budget papers, which include a document entitled “ Outline of Commonwealth Social and Health Services 1953-54 “. This ‘ statement, issued with the authority of the Treasurer, sets out the existing rates of benefit, the proposed rates under the budget, and the maximum amount of the increase, if any, in each instance. It shows that the age pension will be increased from £3 7s. 6d. to £3 10s. a week, an increase of 2s. 6d. At least SO per cent, of pensioners receive the full rate of pension because they are not liable to deductions on account of separate income or property.

Mr Townley:

– That is not true.


– The honorable gentleman should have the facts in his possession, but I maintain that approximately SO per cent, of age pensioners to-day receive the full rate of pension: Yet their payments will be increased by only 2s. 6d. a week.

The rate of the invalid pension also will rise from £3 7s. 6d. to £3 10s. a week. Let us consider the plight of the invalid pensioner. If his wife has to look after him, an allowance of £1 15s. a week is paid to the couple. That allowance will not be increased. Ministers and their supporters have spoken of the rising spiral of costs, but apparently, in their view, that spiral does not justify any increase of the allowance for an invalid pensioner’s wife. What of the children of invalid pensioners? The allowance of Ils. Gd. a week for the first child is unaltered. The maternity allowance for the first child born will not be increased. For the fourth and any subsequent children the allowance is £17 10s. Again, the benefit will not be increased. Child endowment will remain unchanged at the rates of 5s. a week and 10s. a week respectively for the first child and for subsequent children under the age of sixteen years. The pension for an A class widow with a dependent child will be increased from £3 12s. 6d. to £3 15s. a week. Another half-crown increase ! A class B widow, aged between 50 and 60 years, now receives £2 35s. a week. That rate, too, will be increased by half a crown. A similar increase to £2 17s. 6d. a week will be granted to a widow in necessitous circumstances. A class D widow with a dependent child, whose husband is in prison, will receive an additional 2s. 6d. a week. Other benefits, such as the unemployment benefit, the sickness benefit and the funeral benefit will remain unchanged. The funeral benefit is £10. That amount was fixed when it was introduced by the Chifley Government, but everybod’y knows that the cost of funerals has increased by about 200 per cent, in the intervening years. The tuberculosis allowance for a single man or a man and wife will rise by 2s. 6d. a week.

The Treasurer has boasted of the Government’s liberalization of the means test. Under this budget, a pensioner will be permitted to own property worth £1,250. As this is a matter of special interest, I shall read to honorable members extracts from a letter that I received recently from a man who lives in the electorate of Port Adelaide. The letter, which is dated the 18th September, states -

The Minister for Social Services in his report of four years of benefits in social services states that the property exemption (not including home occupied by claimant) has been raised to £1,250. Does this mean that n. person having that sum of money in a bank would be entitled to a pension or part pension (provided of course he hud necessary qualifications as to age and residence, &<:. ) or is the pension reduced by £10 per £100 for the first £500 and then £20 per £100 as previously?

That statement is not correct, but it is not far from the truth. The letter continues -

I have about £1,200 in the bank but this is not enough to buy a home and I look upon my daughter’s place as home, but I am informed that 1 cannot get an age pension until this sum is reduced ‘below £1,000. I am 71 years of age and have no other property of any kind and I arn a widower.

I wanted to answer the man’s inquiry, so I examined the existing legislation and studied the Government’s budgetary proposals. The present legislation imposes a property limit of £1,000, and, as the act stands now, this man could not obtain a pension. I have tried to ascertain what he will be eligible to claim when the Government’s proposals are put into effect. I understand that the act will be amended, but the necessary bill has not been presented to the House and I am not sure of the provisions that it will contain.. The present scale of deductions provides that, when the value of an applicant’s property does not exceed £1,000, a deduction of £1 is made for every £10 by which the value exceeds £300 up to £450. Beyond £450, the deduction is made at the rate of £2 for every additional £10. I have tried to calculate the result when the new property limit of £1,250 is introduced. My correspondent has £1,200 in the hank. Of that amount, £150 will he exempt, which will leave £1,050 to be taken into account in the application of the means test. He will lose £35 for the first £350 of that amount, and £140 for the balance, which will make a total deduction of £175. The proposed new pension rate is £182. Therefore, unless the act is amended in order to vary the method of calculating deductions, this man will bs entitled to a pension of only £7 a year.

Government supporters have spoken as though the Government proposes to do something substantial to help such people. I acknowledge, of course, that the budget provides for considerable aid in some instances, but the speeches of honorable members on the Government side of the chamber are calculated to make us believe that pensioners will receive much greater benefits than they will in fact receive. I do not say that this is entirely a rich man’s budget, but the truth is that the Government proposes that the greatest benefits for pensioners shall go to those who receive only part pensions. The maximum pension increase to those at present receiving £3 7s. 6d. a week will be 2s. 6d. a week. That is all that a full pensioner can expect to receive. To part pensioners, the raising of the property limit by £50 and the income limit by 10s. a week for the purposes of the means test will be worth more than half a crown a week. For the purposes of demonstration, I shall refer to the situation of a married couple both of whom receive pensions. A married couple in this category, with a separate income of £3 a week and with less than £220 in cash, receives a total of £9 15s. a week in pension and private income. If their separate income amounts to £5 a week, £2 a week is deducted from their joint pension, which keeps their total income at the level of £9 15s. a week. Such people are better off than are married pensioners who have no separate income and who, therefore, receive only £6 15s. a week. When the proposed increases take effect, their joint pension will be increased by 5s. a week to £7 a week. However, the pensioners with private income who now receive a combined total of £9 15s. a week will be allowed, under the new provisions, to draw up to £11 a week. The Government has not considered the needs of pensioners who have no separate income or property. Surely, if costs have risen as steeply as the Government has admitted, pensioners need more relief than 2s. 6d. a week. They must buy food and clothing, and they should be compensated for the higher costs of such necessary commodities.

The Treasurer has proudly announced that a man over 65 years of age, with a wife over 60 years of age, who has an income of £750 will not pay income tax under this budget. I wondered what tax such a couple would pay if the man was only 64 years of age and the wife only 59 years of age. The needs of such a couple are just as great as those of an older couple. I have not been able to obtain detailed information of tax scales, but I have made an approximate calculation, according to which the younger couple would be required to pay approximately £47 a year income tax. That appears to be an anomalous and inequitable proposal. Government supporters also have boasted about the percentage reductions of income tax for which the budget provides. They have said that a man, with a wife and two children, who receives £500 a year will benefit from a tax reduction of 39.1 per cent., and that a man, with similar family responsibilities, who receives £15,000 a year will benefit by a reduction of only 9.8 per cent. Both statements -are correct, but let us consider them in terms of hard cash. The man who earns £500 a year is now taxed at the rate of £5 6s. a year, and, under this budget, his tax will be reduced by £3 8s., or approximately ls. 6d. a week. That is all that the much-vaunted 39.1 per cent, reduction represents. The reduction for the man who receives £15,000 a year, however, will be £905.


– That is fair enough.


– The honorable member is entitled to think so, but Government supporters have taken the opportunity to mislead the people by speaking in terms of vague percentages instead of in terms of plain pounds, shillings and pence. A man with a wife and two children who is struggling along on £500 a year, which is less than the basic wage, will have the benefit of a deduction of 18d. a week, but if he were earning £15,000 a year the deduction would be more like £18 a week. It is a matter of 18d. as against £18. I admit that some persons in the higher and middle income groups were being penalized heavily, but my point is that references to percentage reductions do not show the true position. When dealing with income tax deductions, we must look more at the actual sums involved than at percentages. I remember that some years ago, when the Chifley Government proposed to reduce income tax, the present Treasurer (Sir Arthur Fadden) said that the reduction should be made at a flat rate of 10 per cent., but the late Mr. Chifley refused to accept that proposition and stated that he would give the biggest reductions to the people who needed it most. People with large incomes received a reduction of only 2 per cent.

The worker who receives his pay envelope every week is not concerned so much with the amount of income tax that he pays as he is with what is left in his pay envelope after tax has been deducted from his wages. If a man were earning £15 a’ week but had only £12 in his weekly pay envelope after tax deductions had been made, his wife would say that, as far as she was concerned, his weekly wage was £12. I repeat that it is what is left in the pay envelope that really counts. That is the view that Labour has always held. I admit that every man is entitled to adequate remuneration for his efforts, but I contend that when it is necessary to impose taxes to meet the requirements of the nation, those taxes should be paid by the people who are best able to pay them.

I turn now to the means test. To my mind, the most objectionable operation of the means test is in relation, not to income but to property. Let us suppose that a man enters the Public Service and that his brother obtains a position in an industrial organization in which a superannuation scheme is not in force. Let us suppose also that the public servant takes out six units in the Public Service superannuation scheme, which entitle him to a weekly income of £4 10s. on retirement. During his career in the Public Service he invests his capital, as it were, in the superannuation scheme in the form of fortnightly contributions. Let us assume that his brother, having no opportunity to do that, decides to invest some of his earnings in government bonds or to buy a couple of houses -for £3,000. When he retires, he will not be entitled to the age pension, because, notwithstanding that he has invested the same amount of capital as his brother in something to provide for his old age, he has property worth £3,000. If he is lucky, he may get an income from the two houses of £2 10s. a week, on which he will be expected to keep himself and his wife. The man who has contributed to the superannuation fund will receive a weekly payment of £4 10s. from the fund and, under these proposals, only 10s. a week will be deducted from the age pension to which he and his wife will be entitled. The other man will not be entitled to any pension payment. I have argued this matter, not only with the present Government but also with the Chifley Government. When Labour was in power, I argued that it was not dealing fairly with men who endeavoured to make provision for their old age by investing money in either bonds or houses. This problem must be examined again. We must do more for persons of the type to which I have referred than we are doing at present. Even the increase of the property limit to £2,500 will not help people who have property worth £3,000. I have made a calculation of the position of a married couple with property worth £2,500 or £1,250 for each of them. The first £150 is exempt. The exemption is to be increased from £100 to £150. , That leaves £1,100. At present, they lose £1 for every £10 of the first £350, or a total of £35, and on the balance of £750 they lose £2 for every £10, a total of £150. That means that £185 would have to be deducted from a pension of £182, which could not be done. Unless the act be amended, a person with property worth £1,250 will not be entitled to receive any pension, even if he has no income. I think that the Government will amend the Social Services Consolidation Act to help such people. I do not see how it can avoid doing so.


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


.- I was intrigued by the attempt of the honorable member for Port Adelaide (Mr. Thompson) to dissociate the basic wage and the cost-of-living figure.

Mr Daly:

– He made a good job of it too.


– I am not prepared to agree with that statement. The honorable member for Port Adelaide and the Leader of the Opposition (Dr. Evatt) conveniently overlooked the fact that it was impossible to dissociated those two things, because the basic wage is associated with and is dependent upon the cost of living figure. The basis of the basic wage is the cost of living as determined by the C series index. Therefore, if we wish to discuss the relation of some payment to the basic wage, we must bear that fact in mind.

I am rather alarmed at the emphasis that has been placed upon pensions during this debate, because people outside of Australia, and even people in this country, who are not fully aware of the composition of our population, may be. led to believe that we are overburdened with pensioners and that the task of making provision for them constitutes the major problem that faces us.

Mr Daly:

– It is one of the major problems.


– I agee it is one of the problems with which we must deal. But do not honorable gentlemen opposite agree that the problem of finding the wherewithall with which to meet the need of pensioners is more important? What is the use of talking about what the pensioners should have unless we do something to produce the things that they require? Therefore, the problem of pensions is very closely associated with other problems. I do not wish to detract in any way from the importance of adequate pensions, but I say that the emphasis that has been placed upon that matter in this debate could well give a wrong impression of the composition of our population. We are not a country with a preponderance of pensioners who present us with a problem so great that it transcends in importance every other economic problem.

The honorable member for Port Adelaide compared the income tax reductions granted to two income groups. I agree that the figures that he cited were correct, but so also were the percentages that were cited. Apparently the honorable gentleman argues that it is not correct to give an income tax reduction of only 20 per cent, to people in the lower income group and a reduction of 5 per cent, or 7 per cent, to people in the higher income group. He referred to the sums by which the income tax payable by two taxpayers will be reduced, and said that the real basis of comparison was the money value of the reductions. la 1951-52, income tax was increased by 10 per cent. A man who had previously paid £900 a year in income tax had to pay £990, whereas a man who had paid £3 or £4 a year had to pay only a few shillings more. I did not hear honorable members opposite suggest then that the increases were disproportionate. The Government intends to graduate the concessions so that a man in the lower income group will receive a greater percentagereduction than a man in a higher income group.

Let ]11 0 turn to the budget itself. Likethe honorable member for Warringah (Mr. Bland), I am rather disappointed that there has been so little discussion of vital matters, and that the Opposition has not based its arguments upon theonly ground upon which they could safely be based. The budget is a reflection of the country’s economy. It contains facts which either justify orcondemn the actions that the Government has taken. The budget is not an expression of the Government’s opinions or ideas. It consists of facts. It is the Government’s placeto justify its action in the light of these facts; it is the Opposition’splace, if it wishes to deny the correctness of the Government’s actions, to point out in what way these actions are notjustified by the facts given in the budget and the budget papers. The wholeof this budget rests on the statement that: the Treasurer made early in his budget speech. He said -

During 1952-53 retail prices rose by less than 4 per cent.,’ compared with approximately 20 per cent, in each of the two preceding years. Wholesale prices actually fell slightly, whereas in the year before they rose by 16 per cent, and in the year before that by 24 per cent. The average wage level rose by 5.7 per cent, compared with 17.4 per cent, in 1951-52. There were notable improvements in the output of many basic materials whilst, on the primary production side, it was one of the most remarkable years on record.

The budget and the budget papers contain factual information that guided the Government in reaching the decisions that it reached, just as in previous years similar factual information guided it in taking the actions that it then took. Members of the Opposition who wish to contest the Government’s actions must base their arguments on the existing facts and not merely on opinions. I regret that the Opposition has not adopted that policy in this debate. Honorable members opposite have not attacked the Government’s proposals on the ground that the budget papers reveal that some other course of action should be followed. As a matter of fact, they have made very heavy weather of attempting to attack the budget provisions, and I do not intend to spend much time in replying to their arguments, which have no real foundation and have only been advanced in an attempt to embarrass the Government.

A statement repeatedly made by honorable members opposite is that the budget provides concessions only for the. wealthy. The details contained in the budget papers show the opposite to be the truth. They reveal that the budget is not for the benefit of the wealthy. Since this Government took office in 1949-50 it has consistently attempted to lighten the burden of taxes on those who can least afford to bear it, and transfer more of it to those who can afford to bear it. Table No. 60 in the budget papers contains statistics relating to income tax collections over a number of years. In 1949-50, when the Chifley Government was in office, the total percentage of income tax revenue provided by taxpayers in the £200 a year and under income group was 0.7 per cent. In 1950-51, this Government’s first complete financial year of office, that percentage had fallen to 0.4 per cent. Last year, it fell to 0.1 per cent., and this year those persons will not pay income tax at all. The burden will be removed from them altogether. In case honorable members opposite think that I have taken too low an income range, I shall quote similar statistics in relation to the £500 to £1,000 a year income group, which includes most members of the tradesmen class, the class which the Opposition professes to represent here. In 1949-50, 15.7 per cent, of the’ total amount of income tax yield was paid by that group. In the following year, which, I again remind the committee, was the first full financial year of office of this Government, the percentage fell to 14.6 per cent. Last year it fell to 11.6 per cent. A drop from 15.7 per cent, to 11.6 per cent, in a few years is not a bad result.

Mr Haylen:

– Look at the higher income groups.


– All right, I shall. In the year 1949-50 taxpayers in the over £1,000 a year income group contributed 38.4 per cent, of the income tax yield. Last year that group contributed 51.4 per cent, of the yield. On what does the Opposition base its claim that the budget is for the wealthy? The budget is the most valuable document presented in this Parliament, because it contains facts and figures that have not been prepared by the Government, but have been prepared by independent statisticians and experts. The facts contained in the budget papers are undeniable and, as I have said, should be a basis for attacks on the Government’s proposals if any attack were justified.’ However, the facts do not support a claim that the budget makes concessions only to the wealthy. Budget for the wealthy! What a sorry sort of thing to say in view of the facts.

Honorable members opposite attempt to make great political capital out of references to the 1951-52 budget as the horror budget. I am proud that the Government had the courage and political honesty to bring in that horror budget. If honorable members opposite think that this budget is an election-winning budget they are making a mistake, because the budget which will really ensure the reelection of this Government is the so-called horror budget. The people know, as a result of that budget and its effects, that they have in office a government that is not lacking in political honesty, and has the courage to do the right thing however unpopular it may be, so long as it is in the interests of the country. They know that the events of a few short years have completely vindicated the action we took in 1951-52. They know that the Government has at the first opportunity produced a budget that annuls the unpopular but necessary measures that were taken in the 1951-52 budget. The people know that this is a government in which they can have complete confidence, and that the Government has taken immediate advantage of a. changed situation to give taxpayers the concessions that they deserve. When J go to the hustings my main point will be the horror budget. I hope that my colleagues will base their appeals to the electors on that budget, the honesty, integrity and courage of the Government, and its ability to plan successfully to pull this country out of what was, in :i 951, a very dangerous situation.

I echo the praises that have been poured on the Treasurer for his courage. I remember an occasion in .1952 when he said to me, “If I had to call a meeting of my friends I should find a. telephone booth far too big for the purpose”. To-day, the respect and confidence that the Treasurer has Avon through facing up to the bitter attacks that have been made upon him by so many sections of the community are immense. He has lived to see the day when his actions have been vindicated. He deserves the greatest possible credit for his achievements.

The proposed increases of service pensions are naturally disappointing to me and to service pensioners. Even if the increases Aver.e greater they would still seem to many pensioners to be disappointingly small. They are not small, of course, to those who have to provide them. I believe that the whole of our repatriation benefit schemes will have to be altered so that we shall have two classes of repatriation pensions. The first class will be an economic pension for those Who, because of physical circumstances, have to live entirely on their pensions. That pension must be related to- money values. The second class of pension is what I call a “ compensatory pension “. The amount of that pension would be based on the claims submitted to tribunals, such as the repatriation tribunals or to some other form of arbitration. The two classes of pensions would be dissociated. People who have to live on their ‘ pension are entitled, as has been provided for in this budget and the last budget, to receive the major portion of the funds that the Government is able to make available for repatriation benefits. It would be a miserly ex-serviceman who would deny the right of his mates, who need the money, to have a greater proportion of the available benefits. He was prepared to help his mate on the battlefield, and he would be prepared to help him to-day.

I was interested in the remarks of the Leader of the Opposition (Dr. Evatt) about the Public Accounts Committee. He said that perhaps that committee should examine the governmental accounts prior to their presentation to the Parliament. Of course, I know that that cannot be done, but it is enlighten ing to know that at this late stage of his political career the Leader of the Opposition believes that it is necessary that these accounts should be examined by a. body outside the Parliament. . I am glad to know that his attitude indicates that he will never grow too old to learn that there are ways of doing things other than his own. When I first entered the Parliament in 1950, because of my previous study of parliamentary procedure, particularly the procedure of this Parliament, I suggested that a public accounts committee should be set up. Since I have been in this chamber, from personal knowledge of the procedure of the Parliament, I have been more than ever convinced of the necessity for a publicaccounts committee, and, now that one has been established, of the necessity for an extension of its scope so that it will be able to pursue its investigations into other avenues of our financial system. Perhaps it should ‘be empowered to intervene to ensure that there will not be wasteful - I do not say wilfully wasteful’ - expenditure.

Another matter that I have mentioned before in this chamber, and which I intend to mention again, is the desirability of Ministers introducing their own departmental estimates, so that members of this chamber may make some inquiries from the Ministers regarding the proposed expenditure of their departments. I suggest that that is a most important matter. If we are to continue to follow the practice that has grown up in this Parliament, we shall quickly approach the stage where the Parliament will no longer perform the function for which it was brought into being. Originally parliaments were set up to curb the executive power which then resided in a king. The king was the ruler of the country, he took what taxes he thought it necessary to take, and expended them in whatever way he chose. Parliaments came into existence to check the king’s power over the national purse, and to oversee the expenditure of taxes for itself. Circumstances have changed since those days, and to-day executive power is vested in the Government. This Parliament must beware that the powers once wielded by the king do not, because of the neglect by the Parliament of its own duties, fall into the hands of the Executive. If that should happen, the Parliament will find itself powerless to control effectively the public purse.

How many honorable members in this chamber know, for instance, the volume by which trust funds have increased in recent years in this country ? How many honorable members concern themselves about the fact that in 1946, which was the first post-war year, the trust fund account of the . Commonwealth totalled £132,000,000, and that in this year of 1953 the treasury has found it convenient to divide the trust fund account into two sections, and that the total of those two sections is £565,000,000? Of course, the first section relates to funds held by the Government on behalf of persons who are outside of the government departments. The total in that account is £276,000,000. However, £289,000,000 is held by the Government in trust on ‘behalf of various government departments. One hundred and eighty-five million pounds of that latter sum is in the National Welfare

Fund. but nevertheless a substantial sum is left in the hands of government departments in accounts which, as the treasury itself states, are “working accounts covering certain factories, concerns and services and moneys held in trust under the authority of Parliament to meet future expenditure “. However, I am quite certain that the Parliament knows nothing about the money held in trust. The main point about this matter is that those vast trust funds place in the hands of the Government a means, if it should wish to use it, to manipulate the currency of the nation.

Mr Daly:

– Does the honorable member believe all this?


– If the honorable member for Grayndler (Mr. Daly) does not believe it he has no right to be in this place, because it is his duty to make himself aware of the figures that I have cited and to exercise some thought about what they mean to this country. That vast sum of money would enable any government to make itself financially independent of the Parliament. 1 do not object to trust funds, I believe that they are a necessary evil; but conditions should be attached to those trust funds to give the Parliament a greater control over them than it has at present. In short, the Parliament should decide what those funds are to be used for while they lie in the hands of the Government.

The so-called horror budget is a horror budget only to the Labour party, because it is on that budget that this Government has based its fight to restore confidence to the people. The fact that honorable members opposite have called it a horror budget is a tribute to this Government, which has worked honestly and with great capacity to bring the country out of the troublous times into which the last Labour Government had plunged it.

Mr. W. M. BOURKE (Fawkner) riO.10]. - The honorable member for Moore (Mr. Leslie) expressed disappointment that honorable members on this side of the chamber had not given proper attention to the budget, and said that he wanted us to deal with the facts of the budget. I accept his invitation, and I shall deal with some of the facts associated with the budget. I also hope to accept his invitation ‘ to say something about the horror budget, of which he was so remarkably proud. The first fact is that the Treasurer (Sir Arthur Fadden) was in a very happy position when framing his financial proposals, because the national income had increased by 10 per cent, during the last financial year. The national income had increased to £3,579,000,000, and the Treasurer apparently expects it to continue to increase. The Treasurer knew that on the existing rates of taxation he would have a good surplus at his disposal, because in this financial year for which the estimates are before the chamber, the Government, for the first time since it has been in office, has placed some curb on the reckless and extravagant expenditure that has marked its progress during the last few years. Expenditure will remain practically stationary - just a few million pounds more than last year. Therefore, the Treasurer, solely because of the increased national income and the consequent greater yield from taxation, was in the happy position that a substantial surplus could be returned to the people in the form of taxation concessions or increased social service payments. The manner in which that twofold task has been carried out determines whether this is a good budget, and upon a careful analysis it is- quite clear that it is not a good budget.

The budget maintains neither justice nor equity as between sections of the community in the manner in which the benefits of reduced taxation have been apportioned, and there is more than injustice and miserliness in the inadequate way in which social service benefits have been increased. An analysis of the budget reveals that it is open to the greatest of criticism and the gravest of censures. Despite this fact the budget has been greeted by the press of Australia with almost unanimous acclamation. The press has so stressed the excellence of the budget that many people believe that it is a good budget, and that it has conferred great benefits on the community. However, it should be observed that the newspapers of this country, and the institutions which conduct the newspapers, are not independent authorities when they are reviewing the effects of this budget. They are not impartial organizations which can sum the budget up- in the interests of the people. The big newspaper companies are among the greatest beneficiaries of the tax remissions that have been given by the budget. As companies which publish newspapers, they stand to profit more than any other section of the people from the taxation concessions, and, therefore, the opinions which they have put forward and the judgments that they have formed about the budget, and which they have offered to the people, must be treated with the greatest of reserve. There has been a reduction of the rates of taxation of public companies from 7s. to 6s. in the £1 on the first £5,000 of profit, that is 14 per Cent., and then - and this is the most important reduction of taxation in all the budget proposals - a reduction on the balance of profit over £5,000 from 9s. to 7s. in the £1, which is 22 per cent. I ask honorable members to compare that 22 per cent, reduction with the overall average reduction of individual taxation of 12^ per cent.

In the remarkable newspaper case that has been before the courts in the last fewdays, mention has been made of £2,000,000 overdrafts, debenture issues totalling £750,000, and so on. The finances of the newspaper companies are so complete that any considerable saving of taxation represents a great benefit, so all the propaganda that they have been putting forward should be discounted. To show how completely selfish the newspapers can be, and how they can confine their attention to the exclusively selfish interests of the individuals that they represent, and completely ignore the interests of the people, I draw attention to a review of the budget that appeared in the Australian Financial Review of the 30th September, 1953, the day after the Treasurer introduced the budget. The Financial Review which is written for the guidance of investors, was not satisfied with the very substantial reductions proposed by the Government in company taxation. It considered that further taxation reductions should be made but that they should apply only to the financial interests which it represents. It recommended the abolition of the pay-roll tax and the adoption of more liberal depreciation provisions, which would cost a proximately £50,000,000 or more, and would benefit, among others, the newspaper companies, lt demanded additional concessions only for the business section of the community. In a most interesting paragraph concerning social services payments the journal states -

No doubt all the concussions announced last night-

Including the 2s. 6d. a week addition to the rates of pensions paid to aged and invalid persons and widows - are worthy and can be defended on humanitarian grounds.

Opposition members think that the concessions can not be defended on those grounds because they are totally inadequate. Pointing a stern finger of warning at the Treasurer so that he will not be so rash as to further increase social service benefits the journal continues -

Nevertheless there is a heavy responsibility on the Government to ensure that social benefits do not become an intolerable burden.

That attitude sums up my first criticism of the budget. It gives more than adequate tax concessions to one section of the community, the companies, and completely inadequate benefits to the recipients of social services payments. A comparison of the miserable increase of 2s. 6d. a week for the aged, the invalids and widows, an increase which the honorable member for Moore (Mr. Leslie) has rightly described as disappointingly small, with the substantial benefits which will accrue to some of the big1 companies as the result of reductions of the rate of company tax, reveals how unjust is this budget and how inequitably the benefits which it confers ‘ have been distributed over the community. For the income year ended the 31st December, 1952, General Motors-Holdens Limited made a trading profit, after payment of taxation, of £3,947,54S. The provision for income tax in the balancesheet of the company on the basis of that profit was £4,026,799. That provision was made at the then existing rates of tax, but if the tax is worked out at the new reduced rate it will be reduced to £3,132,094. Thus the saving to one company alone is £894,705. It is interesting to compare such a saving in taxation by one company with the inadequate in- crease of 10s. in the special rate war pension and of 2s. 6d. in all other repatriation and social service pensions, including those paid to war widows. Unlike individuals, companies are taxed on the profits received in the preceding year of operations. When the year’s .operations have been completed tax provision is made and money for that purpose is set aside. A considerable saving will be made in the money set aside for that purpose by the company to which I have referred. Contrast the Government’s benevolent attitude to big companies with its attitude to the aged, invalids and war pensioners, including widows. The total repatriation benefits provided in the budget for the remainder of this year amount to £909,000, an amount which approximates the saving that General MotorsHoldens Limited will make as a result of this budget.

I accept the invitation of the honorable member for Moore to comment on what is known as the horror budget of 1951. The honorable member contended that the measures contained in that budget were successful and that this Government would again be returned to office because of that success. I agree that if we arc to. assess properly the present budget we must cast our minds back to the 1951 budget. In that year the Government savagely increased the rate of direct and indirect taxation ; it imposed a 10 per cent, levy on all individual income taxpayers; it increased company tax; and it also increased sales tax on certain items to the unheard of rate of 66£ per cent, lt acted on the completely fallacious principle that as inflationary pressures were apparent in the community the surplus purchasing power of the people had to be skimmed off. The people were accordingly deprived of their capacity to spend. The fallacy of that line of reasoning quickly became apparent. The Government took the money from individuals in the community, but it did not freeze it. Instead it placed the money in the exchequer and embarked upon a wild orgy of expenditure until the whole, of it had gone. If it was inflationary for surplus money to remain in the hands of individuals, it was even more inflationary for the same amount of money to be spent by a government because, as we all know, money is not expended by governments as economically as by the average housewife.

The 1951 horror budget was a complete and dismal economic failure. It did not curb inflation. Indeed, the very figures that were cited by the honorable member for Moore indicate that during 1951-52 the fires of inflation continued to rage unchecked. The 1951 budget not only failed to check inflation but it also almost ruined our economy. It brought about unemployment ; it forced industries to close down; it created the unique situation in which, at a time when we were experiencing the evil of inflation we also experienced the evil of deflation. We had the dual evils of rising prices and unemployment at one and the same time. The Government soon realized that its economic policy had been a disastrous failure and it set about undoing the tremendous damage which it had done to the economy. Last year certain taxation concessions were made. This year further taxation concessions have been announced. The Prime Minister and the Treasurer have said that a total amount of £200,000,000 has been returned to the taxpayers in the form of taxation concessions during the last two years. They completely ignore the fact that a considerable portion of that amount is accounted for by the restoration of tax rates which had been unjustifiably increased in 1951. The credit which the Government has taken to itself in this respect is to a great degree unjustifiable.

My next criticism of the budget, and it is a very valid one, is that it makes very inadequate provision for the family man. It is true that the concessional deduction for a dependent wife has been increased from £104 to £130 and that increased deductions have been allowed for medical, dental and education expenses. But that is as far as the concessions go. These proposals received great publicity in the press. The Prime Minister and other Ministers made great play on them. Why was not the concessional deduction for dependent children increased? There is scope for a completely new deduction in the interests of the family man. The Government should consider the desirability of allowing as a deduction for income tax purposes interest which n taxpayer pays on the mortgage on his home. This Government pays lip service to the principle of home ownership but it does very little to give practical expression to that principle by making home ownership more easy. As the result of increased interest rates the prospect of a person becoming a home owner is very much worse now than it was in 1949. If the Government is sincere in its protestations that it’ is interested in encouraging people to own their own homes, surely the concession that I suggest is the least that ii could do. It should go further and finance home purchases at low rates of interest. In this budget it should at least have provided that interest paid by a taxpayer on a mortgage on his family home, up to a limit of say, £100, should be an allowable deduction for income tax purposes. Such a concession would give desirable additional relief to the family man. I come now to the matter of child endowment which is the most direct and most important means by which a family man may be helped to overcome the adverse effects of inflation. The Government has done nothing to increase the rate of child endowment. The Leader of the Opposition (Dr. Evatt) has told the people that if he is elected to office he will increase child endowment as a worthwhile concession to the family man.

My final criticism of the budget is that it is a dangerous budget because it has within itself the seeds of inflation. Before the year is out we shall be reaping the dreadful harvest. Let us consider the effect of taxation remissions on money in the hands of investors. The investing public will benefit in many ways from this budget. In the first place company taxation has been cut. That will leave in the hands of the companies a lot more money, which will be available for investment. It will also leave much more money available for distribution to the shareholders. That is the first way in which the investing public will benefit. Secondly, when that increased amount of money reaches the hands of shareholders, they will pay tax at a decreased rate in accordance- with the new schedules, so that they will have more money for investment. As the result of the abolition of the special property tax, which was imposed on income derived from rent, interest, or dividends, at rates ranging from 4d. to ls. 4d. in the £1, there is a third way in which members of the investing public will benefit. This last benefit alone will put £2,000,000 more into the hands of’ the investing public for the balance of this financial year.

As the result of the operation of these tax concessions, a lot more money will bc available for investment in this country. If that money is invested in basic industries or primary production, it will be a good thing for Australia. The investment of more money is needed for the development of our country. But when those factors are considered in relation to the reductions in sales tax upon luxury goods, I detect a very real danger that a lot of these additional investible funds will be diverted again to luxury and nonessential industries, and man-power, materials and capital will be diverted in that direction instead of to developmental works of value to Australia.

These remissions of sales tax represent a complete abandonment of the principles which the Government enunciated in 1951. The sales tax on luxury items has been reduced to 16f per cent., whereas the basic rate remains at 12J per cent. Last year, the collections from sales tax amounted to £89,000,000. The Treasurer estimates that the receipts from this source in this financial year will be £87,740,000. The main concessions in sales tax which the Government gives in this budget benefit the luxury and non.essenital industries. Among the goods which received maximum reduction are jewellery and imitation jewellery, plate and plated ware, watches and watch cases ornamented with precious stones, serviette rings, fancy goods made wholly or principally of precious metals, artificial flowers, furs, and so on. Yet the rate of sales tax on all those goods has been substantially reduced. As I have stated, I detect a very real danger that the extra investible funds, which will arise from the substantial cut in company tax, will be diverted to luxury industries instead of to essential developmental works.

Mr Wheeler:

– How foolish does the honorable member think big investors are?

Ifr. W. M . Bourke.


– I believe that some of these additional funds will be invested in luxury and non-essential industries, because of the big profit margins in those industries.

Australia is confronted with gome very serious problems. Our north is very sparsely populated. Hundreds of millions of people live in the islands to the north of Australia and on the continent of Asia. This knowledge makes us feel very worried about our future, and whether our children and our children’s children will be able to hold this country. We have an urgent task, which is to develop and populate our country. When we consider the undeveloped condition of our . north, we feel that money spent on immigration and development is well spent indeed. We cannot help feeling that the mistake that has been made in our ‘ immigration policy is that the majority of the newcomers have been coming to the cities instead of settling: in the country districts where the need for population is most urgent.

Historians who examine this budget in the future will arrive at the correct conclusion that this Government has once again failed the people, because the budget, instead of encouraging and diverting money to the vital tasks which concern the future of the country, will encourage inflationary tendencies. This budget stands condemned because it is unjust and inequitable. The benefits which it confers upon the people are one-sided, and are confined to one section of the community. Substantial benefits are granted to the big companies, but the social services payments to pensioners are completely inadequate. The benefits handed to the family man are also grossly inadequate. The budget has failed the people and the economy. It does not grant social justice. Just as it has failed economically, it will fail the Government politically.


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


.- The speech of the honorable member for Fawkner (Mr. W. M. Bourke) has closely followed the pattern of the speech of the Leader of the Opposition (Dr. Evatt). This pattern indicates the real difficulties which confront members of the Labour party, because the legitimate role of the Opposition is to oppose and find fault with the Government’s budget. One has only to listen to the speeches of Opposition members to realize the magnitude of their task. It is difficult for them to convince the people that they have any real cause for concern, when relief from taxation is being given, imposts have been lifted for the first time in the lifetime of many of our youngest taxpayers, small businessmen have recouped something that they have been eager to recoup for a. long time, and social services have been increased.

The first reaction of almost every person when he examines the budget is, naturally enough, to ask, “ What is in it for me ? “ This time, the answer fairly screams back to him that there is something in the budget for everyone, but that special attention is paid to those people who have felt the pinch most severely in the last two or three years. I refer particularly to the middle income group. Therefore, I can readily understand why Opposition speakers have been beating the air as they have endeavoured to strike an indignant note and claim that the budget is not soundly based and has not been well received by the public. The honorable member for Fawkner is most surprised that people are so thick in the head that they cannot appreciate effects of the budget. He also believes that the newspapers are completely dishonest in their reception of it. Members of the Labour party generally have followed that line of argument consistently in this debate.

The speech that really arrested my attention was that the Leader of the Opposition, because he made a number of assertions which prompted me to examine the Hansard report of his speech on the budget last year. I find that that right honorable gentleman made some remarkable statements on that occasion about the abolition of the means test, yet he admitted at question time to-day that he had not calculated exactly the cost that the abolition of the means test would involve. When he was told that the cost would be at least £70,000,000, he expressed some surprise. It is most necessary for us to compare the statements made by the

Leader of the Opposition last year with those that he has made on the budget this year, because he presents himself to the people as a future Prime Minister. Consequently, everything that he says must be treated most seriously. The right honorable gentleman made the following statement on the budget last year : -

It is obvious that this budget is induced to a substantial degree by by-election panic.

I note, in passing, that he has referral to the budget this year as a panic budget. The report of the right honorable gentleman’s speech continues -

But when the Government comes to the barrier all it can produce is a number of minor palliatives. There is nothing indicated in the budget to arrest the drift to recession and unemployment. It is not sufficient for the Government to .make a few minor concession* or to try to appease pressure groups. The small concessions that are made in the budget appear to give temporary relief in some directions, but the major problems are left completely untouched; and once again the historian is proved correct when he says, “ Small concessions often do not produce small consequences - they produce no consequences al all “.

I do not consider that the Australian people believe that small concessions are of no consequence. This budget grants the greatest reduction of income tax in the history of the Commonwealth. The Leader of the Opposition will not be able to convince the people in my electorate that the 14,500 families who’ will be relieved of the obligation to pay £250,000 in income tax alone this year regard this concession as of small consequence. He will not be able to- convince 50,000 small businessmen that relief from the pay-roll tax is a matter of no consequence to them. They will save £5,000,000 per annum. In addition, there are” 100,000 people in the Commonwealth who are morally but not legally entitled to a pension at the present time. I describe them as some of our best citizens. They made some financial preparation for their old age, but because of world-wide inflation and other circumstances, they have been robbed of much of the money that they had . put aside for this purpose. These people will be entitled to pensions. Will they think that the budget is of no consequence? What of the 45,000 Commonwealth superannuated officers, the 165,000 State and local government superannuated officers, and the 200,000 persons who receive superannuation pensions from private organizations? Those whose pensions do not exceed £750 a year will be relieved of all income tax. Will they think that this budget is of no consequence ?

Another statement that the Leader of the Opposition made in 1952 was -

There is no doubt that a definite trade recession has commenced. Indications of that arc scattered throughout the Treasurer’s speech on the present budget. For the first time in ten years, a substantial degree of unemployment has appeared.

The honorable member for East Sydney (Mr. Ward) supported those remarks in March last, when he said that there were 150,000 unemployed in Australia. That was a conservative estimate, he said. Most people, of course, realized that this was characteristic of the wild statements that the honorable member so frequently makes. But the Leader of the Opposition, who aspires to the Prime Ministership, is a man whom one might expect to be a little more careful than the honorable member for East Sydney when criticizing the Government’s policy. The truth is that there has not been a trade recession this year. In fact, both local business and the export trade have been more prosperous than in previous years. The national income is at the highest level it has ever reached. It amounted last year to £3,579,000,000. Our trade balance has made a remarkable recovery, and many of our leading secondary industries have made larger profits than for many years past. As a result of this improvement, the Government will reduce import restrictions. The unemployment figure is at a remarkably low level. Less than 1 per cent, of the Australian work force is in receipt of the unemployment benefit. The figure for Victoria, the State where I live, is even better than the overall average. Only 0.5 per cent, of the work force of that State is drawing unemployment benefit. That is the lowest figure in the British Commonwealth today. Statistics show that the trade position, the employment level and economic conditions generally in Australia are most satisfactory. The Government otherwise would not have been able to make the great reductions of income tax and sales tax for which this budget provides.

These facts show that no reliance- Tjan be placed upon statements made by the Leader of the Opposition and the honorable member for East Sydney. Their statements are contradicted not only by the facts but also by leaders of the great trade unions, which they profess to represent. I remind the honorable member for East Sydney of the following statement by the president of the Australian Council of Trades Unions, Mr. Monk -

The budget clearly shows the opinion of thegovernment that the Australian economy is stable. The general reduction in taxation of 12J per cent, is most welcome.

The secretary of the AustralianFederated Ironworkers Association, Mr. Short, said -

The taxation reductions will greatly benefit both the workers and the employers.

And he was quite right ! Yet throughout this debate we have heard a continuous dirge from the calamity Joes on theOpposition side of the chamber, who wail about the future prospects of our economy. We know that all these blackcoated gentlemen, in fact, realize as well as we do that the budget will produce wonderful results during the next twelve months. Let us not make any mistake about the proposed tax concessions. They are not hand-outs. The fact is that Australians, as individuals, will pay less income tax this year because, as a nation, they are producing more.

There are two important facts that we should keep in mind. The first is that increased production is due to careful planning by this Government in the last two years. The Government’s planning made possible the conditions that led to the remarkable increase of the national income. The second fact is that the Menzies Government now proposes to hand back to the people the benefits produced by their own efforts. This may not sound magnanimous, but what would a Labour government have done in similar circumstances? Would it have turned back to the people any benefits that, accrued from their efforts? Records show that Labour governments invariably put any additional money under their control into socialistic projects of one sort or another. I was reminded of the inefficiency of many State projects to-day by the honorable member for Warringah (Mr. Bland), who discussed the activities of the Public Accounts Committee during the last few months. I remember also the reports that appeared in the press of evidence given to the committee by various individuals in relation to projects that were initiated during Labour’s regime. There are numerous undertakings into which the Labour party diverted the benefits that accrued in good years. For instance, the previous Labour Government gave permission in 1947 for the purchase of an oil-drilling plant at a cost of £320,000. That equipment, which has never been used, is lying idle in Melbourne. I understand that an additional £500,000 would have to be expended in order to put it into operation to-day. That is only one of the many ineffective socialistic projects that Labour governments have initiated. One need not look very far to find examples in Canberra. There is a saw-mill in this city, which was established by the Labour Government and which operates to-day at a loss of £57,000. ( ‘aref ul planning should be applied to expenditure by the Australian Government and all State governments. I agree with the honorable member for Fawkner (Mr. W. M. Bourke),, who referred to the importance of using loan funds to finance public works, but I remind him that our ability to pay for Such works out of loan money will depend not only upon the tax reductions that this Government will grant in 3953-54 but also upon the careful planning of the State governments. Priorities should be laid down, and waste and inefficiency must be kept to a minimum. State governments are apt to be careless of such matters when they undertake big public works projects. It is impossible not to bc concerned, with the plight in which the people of Victoria find themselves at present. Surely they have never faced po problematical a future as they face to-day, with their prosperity dependent upon the provision of more power. The Victorian Government claims that it is doing its utmost in the Latrobe Valley, for instance, to meet the demand for additional power, hut throughout that valley one can see costly machines, including valuable diesel engines, standing in the open exposed to all weather condi tions. There is a lot of jiggery-pokery going on with public money in that great power centre of Victoria. Indeed, one rarely sees waste and inefficiency so blatantly exposed< as in the Latrobe Valley. One illustration that came to my notice recently was that of a group of men at Morwell, who lose a lot o£ sweat over the preparation of working drawings I They are served every morning by a utility truck, which travels 200 yards to their office. The driver of the truck is paid £35 a week for this work. The vital cargo that the truck carries each day consists of fourteen cups of tea. How often, in how many places and on how many other projects are drivers paid £35 a week to carry fourteen cups of tea 200 yards each morning? Have the people who are responsible for such undertakings forgotten how our forefathers had to put up with the hardship of boiling a billy whenever they wanted a cup of tea?

I have drawn the attention of honorable members to such matters in view of the remarks that were made earlier to-day on the subject of public finance by the honorable member for Warringah. I consider that the Victorian Government needs more than ever before the services of such a body as our Public Accounts Committee. Perhaps such committees could serve a useful purpose in other States as well. Investigations of public expenditure might force State governments to toe the line and reduce the tremendous waste and inefficiency of which one sees evidence on all hands,, especially in Victoria. If we want people to subscribe to Commonwealth loans, we must foster their confidence by setting a good example. In 1951, this Government was forced to perform many unpopular acts. It had to cut imports, control capital and maintain the tax burden. These measures were essential, but they were abhorrent to every member of the Liberal party. However, the fact is that, after two years, the Government is now able to return to the original purposes that this party serves.

We are opposed to high taxation and to controls. Our main objective is to make Australia free and strong. The whole policy underlying the 1953-54 budget has been designed to make this country a land where men may talk and pray and think as they please. I invite taxpayers throughout Australia, and particularly members of the Opposition, to read again the budget speech of the Treasurer. If they will do so, I am sure that they will come to the conclusion that this Government has done its job well. The rest is up tous, to the workers, to industry, to the farmers and to the investors. This is a time for greatness.


.- There are various matters-

Motion (by Eric J. Harrison) put -

That the question be now put.

The committee divided. (The Chairman - Mr. C.F. Adermann.)

AYES: 59

NOES: 50

Majority . . . . 9



Question so resolved in the affirmative. Question put -

That the item proposed to be reduced (Dr. Evatt’s amendment) be so reduced.

The committee divided. (The Chairman - Mr. C. F. Adermann.) Ayes . . . . . . 50


NOES: 60

Majority 10



Question so resolved in the negative.

Amendment negatived.

The general debate being concluded,

First item agreed to.

Progress reported.

page 581


Message received from the Senate intimating that Senator Paltridge had been appointed a member of the Joint Committee on the Broadcasting of Parliamentary Proceedings in the place of Senator Maher, resigned.

page 581


Social Services - Repatriation

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

That the House do now adjourn.

West Sydney

– I desire to raise a matter that I was most eager to discuss during the budget debate. “When it is realized that only half of the members of this House spoke on the budget-


– Order ! The honorable gentleman is referring to proceedings in committee, which may not be discussed by the House.


– Last week-end two invalid pensioners sent for me and asked me to take up a matter on their behalf concerning a pension claim. We have heard a lot from honorable members opposite about the Government’s treatment of pensioners. The case that I wish to put before the House is one in relation to which the Minister for Social Services is sympathetic. We have listened for very many hours to the honorable member for Bennelong (Mr. Cramer) condemning the New SouthWales Government in relation to the purchase price that it paid his company for land taken over from it.


– Order !


– I wish to inform the House of this Government’s treatment of two invalid pensioners. It will be no credit to the Government. The two pensioners live in Redfern, a suburb of Sydney. I shall not mention their names. The husband was born in the house 75 years ago. His wife is now 74 years of age. The Government resumed the property for use as premises for the mail branch of the Sydney General Post Office. The pensioners have no quarrel with the Government regarding the resumption of the property, but they wish to regain the pension rights that they have lost as a result of it. The husband had received an offer of £1,000 for the property, but the Government, after six long months of making up its mind, offered him £348 for it. He said he could not accept that price. Another valuation was made and, finally, the Government paid him £525 for the property. It then told that aged couple that they could rent the property at 32s. 6d. a week until such time as the Government wished to use it. After a long time the Government decided to reduce the rent to £1 a week. After another period of two months, during which the husband wrote a great number of letters and visited Government offices in Sydney, the rent was reduced to 15s. a week. So the pensioner has to pay 15s. a week for the privilege of living on a property that he formerly owned, and which the Government has taken from him. As a result of the payment that he received for the property the husband has had his pension reduced by about 17 s. It is costing him, therefore, about. £80 a year in rent plus loss of pension to live in his old home.

Mr Osborne:

– Is he receiving any interest on the compensation money?


– If the honorable member for Evans (Mr. Osborne) likes to do so he may have the job of acting on behalf of the Government as a solicitor in the matter. I called at the home last Sunday morning to see this unfortunate man, and I heard his wife saying, “For God’s sake do not sell the house “. He said to me, “ My wife has gone demented since all this came about, but she does not know that the house was sold more than six months ago “. The man has taken his misfortune with fortitude. He reared six children in that house, two of whom are still alive. He is not quarrelling about the resumption price, but he wishes, andwith good reason, to have the reduction of his pension adjusted. When we hear the honorable member for Sturt (Mr. Wilson) who represents a division in South Australia, talk so much about what the Government has done for the pensioners, and when we have the honorable member for Bennelong to suffer up the time of this House for two long nights telling us about his company and condemning the New South “Wales Government because it acquired its land at the 1942 valuation, we realize just how much the Government cares about the pensioners. I ask the Government at least ro restore this man’s full pension. When he visits the pensions office and calls for justice he is asked, “Well, why don’t you buy another property? You can take ii mortgage out “. The Government has paid him only £525 for a property for which he was offered £1,000 ; yet its officers suggest that he should buy another house with the money. Some of them should be in the mad-house. If the Government really had done something good for the people it would not want to wind up this budget debate after only two weeks. “Mr. SPEAKER.- Order ! The honorable member may not comment on that matter.


– I know that the Minister is sympathetic regarding this case, and is prepared to give that old couple justice if the Government will sanction it.. It will only be about two and a half years until their cash is exhausted and they will have neither homo nor money. Having resumed the land, the Government could at least have allowed the old couple to live there rent’ free until such time as the property was required by the Postal Department. It will not be so required while this Government is in office. The honorable member for Evans asked me if the pensioner was receiving interest. The Government pays no interest on the money, and it pays no rates on the property. These old people will eventually lose every penny of their money because of an act of the Government and it is up to the Government to rectify this injustice. This is only one example of many that show how- the Government is treating pensioners. I hope that the Minister will be allowed to use his discretionary powers in order to help these people.


.- There arc two matters which I desire to put. before the House, but before doing so I should like to make a brief reference to the remarks of the honorable member for West Sydney (Mr. Minogue). Situations such as he has described are not novel. Their occurrence was not infrequent under the preceding Government.

Mr Ward:

– That is not true!


– Order !


– They occurred frequently.


– They did not!


– Order ! The honorable member for East Sydney (Mr. Ward) must remain silent.


– It is usual for people to put such matters before their parliamentary representative. He makes a direct approach to the Minister, who usually has the matter adjusted. That is a more effective way of dealing with such matters than raising them in the House and endeavouring to make political capital out of them.

Opposition members interjecting,


– Order ! The honorable gentleman will resume his seat for a moment. The hour is getting fairly late, and if honorable gentlemen are not prepared to maintain order I shall be happy to go to bed.


– One of the two matters which I wish to bring before the House concerns the payment of service pensions. It is an administrative matter adjustment of which will not require legislative action. Service pensioners have to attend post offices, or send a representative, in order to collect their pensions. Age pensioners, war widow pensioners, and the pensioner parents of deceased exservicemen are paid by cheque, if they so desire. Some service pensioners would appreciate the benefit of having their pensions paid by cheque in the same manner. I say some, because many pensioners like to foregather at the local post office on pension day in order to meet their acquaintances. Many service pensioners, however, are incapacitated or old, and are unable, except with great difficulty, to collect their pensions personally. I believe that adjustment of this disadvantage would be a matter for the Treasurer (Sir Arthur Fadden), and I ask him, therefore, whether he will give consideration to the payment of service pensions by cheque, when that method is desired by the pensioners, if the pensioner notifies the department in writing accordingly. .

The other matter to which I wish to refer concerns the periodical medical examination of service pensioners that are made by the Repatriation Department’s medical officers. Sometimes a medical officer discovers that an exserviceman is suffering from disabilities other than those for which he is receiving a pension. Sometimes the disabilities are of a serious nature, hut the medical officer has not advised the ex-serviceman of it. The result is that the pensioner continues his normal activities, not suspecting that he is incapacitated by another disability, for which he makes no effort to obtain the urgent treatment that the condition requires. The condition therefore becomes worse. Conditions such as cancer and heart troubles should be notified by the doctor, whether or not they are, in his opinion, attributable to war service. The examination of an exserviceman in connexion with a particular disability for which he receives a pension is routine, but any other disabilites uncovered by that routine examination should be notified to the pensioner, so that he will have the opportunity to obtain early treatment for them and possibly have them cured-/ “ “5911611 he does not know that he is suffering from such disabilities he does nothing, and the complaint may become chronic. The obligation is fairly and squarely on the medical officer to make that information known to the ex-serviceman, because, even if the Repatriation Department will not accept the disability as being due to war ‘ service the pensioner, armed with the knowledge of its existence, will have the opportunity “to seek private treatment which may prolong his life.


– The Government is not carrying out the provisions of the act.


– For the benefit of the honorable member for Melbourne (Mr. Calwell), two cases that I have in mind occurred when the Chifley Government was in power. But I do. not suggest that this practice is not continuing. It is an administrative matter, and its correction require no legislation. However, I would ask the Minister for the

Army (Mr. Francis) to refer the matter to his colleague, the Minister for Repatriation (Senator ‘ Cooper) for urgent consideration.

Minister for the Army · Moreton · LP

Mr. Speaker-

Mr Ward:

Mr. Speaker, I rise to a point of order. I wish to raise a matter, but apparently the closure will be moved after the Minister for the Army (Mr. Francis) concludes his speech. Could I be permitted to speak after the Minister ?


– Order ! I wish- to make it perfectly clear that I have no control over the moving of the closure. I cannot give or accept guarantees about that, but I believe that it is convenient, particularly in view of the set-up of Hansard, that the Minister should comment on a matter like this forthwith.

Mr Ward:

– Normally I would agree that that procedure should be followed, and it has been followed on a number of occasions. But when it is obvious that the Vice-President of the Executive Council’ (Mr. Eric J. Harrison) has indicated that he will move the closure as soon as the Minister for the Army completes his speech, an honorable member qf the . Opposition should not be asked to forgo his right to speak before the Minister.


– If it is a matter ofContinuity, which is deirable because of the set-up of Hansard, I submit that consistency and continuity might reasonably ‘be considered from the point of view of this side of the House. While the . honorable member for Lilley (Mr. Wright) was speaking, I had an overwhelming desire to say something on the same subject; but the Minister for the Army (Mr. Francis) intervened. Is the Minister’s reply considered to be more important than submissions that honorable members of the Opposition desire to make about the same matter?


– If the honorable member for Gellibrand (Mr. Mullens) rose, I did not notice him. I do not suggest that the honorable member did not rise. I merely say that I do not know whether he did or not. In these adjournment debates I have endeavoured to keep one matter before the House until it is concluded, so that we may have something like order in the presentation of the case. However, I am in the hands of the House.

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

That the question be now put.

The House divided. (Mr. Speaker - Hon. Archiecameron.)

AYES: 68

NOES: 41

Majority . . . 17

In division:



Mr.Mullens. - Ned Kelly!


– Order ! Honorable members should not be referred to by their personal names.

Question so resolved in the affirmative.

Original question resolved in the affirmative.

page 584


The following papers were presented : -

Lands Acquisition Act - Land acquired for Commonwealth purposes - Portland, Victoria.

National Fitness Act - Report for 1951.

Norfolk Island Act - Ordinance - 1953 - No. 4- Norfolk Island Public Hall.

Public Service Act-Appointment - Department of the Interior - W. D. Kennedy.

House adjourned at 11.40 p.m.

Cite as: Australia, House of Representatives, Debates, 23 September 1953, viewed 22 October 2017, <>.