20th Parliament · 1st Session
Mr. Speaker (Hon. Archie Cameron) took the chair at 10 a.m., and read prayers.
Mr. WARD presented a petition from certain Australian citizens praying that the House of Representatives will consider the continued unrestricted importation of recorded overseas radio programmes and take action to protect the Australian interests which are endangered thereby.
Petition received and read.
– Is the Minister for Commerce and Agriculture yet in a position to give further information, as he promised last Friday, in answer to my question on the closing down of a tannery at Goulburn, New South Wales, due to the alleged failure of the Australian Hide and Leather Industries Board to allocate sufficient hides to it?
– I have some further information to give to the honorable member. As it is somewhat lengthy, Mr. Speaker, may I have the approval of thc House to have it incorporated in Hansard?
– Is there any objection?
– I shall not occupy the time of the. House by giving the information at this stage. I shall supply it to the honorable member later.
– Will the Vice-President of the Executive Council say whether donations and subscriptions to parents and citizens’ associations and similar bodies are allowable deductions for income tax purposes? If they are not, will the Government give consideration to including them in the list of items that can be treated as allowable deductions ?
– So far as I am aware, such donations and subscriptions are not allowable deductions. The point made by the honorable member is an interesting one. I shall see that it. is. brought to the notice of the Treasurer and that some .consideration is given to it.
– I ask the Vice-President of the Executive Council whether it is a fact that acceptance by the Governments of Victoria and Queensland of a compromise wheat agreement, under which the price of wheat for consumption in Australia will be increased to lis. a bushel, will cause the cost of living to increase by from ls. to ls. 6d. a week? Does the right honorable gentleman realize that the increase of the cost of living arising from this factor alone will substantially nullify the paltry increase proposed to be paid to various recipients of social services benefits, even before it is received? Will he indicate the action, if any, that the Government proposes to take to meet the position ?
– The question asked by the honorable member is so involved and contains so many inaccurate statements that I suggest he clarify his mind and place his question on the notice-paper.
– Will the Minister for Territories inform the House of the quantity of copra imported into Australia from Australian territories during 1952-53? Will he also state the approximate quantity of coco-nut oil that was obtained from the copra, the proportion of the coco-nut oil that was used in the manufacture of table margarine, and the other uses that were made of the balance of the coco-nut oil and the copra residue after completion of the extraction processes ?
– I can give an answer in round figures. About 27.000 tons of copra were imported into Australia from the Australian territories. The copra goes through crushing mills. The first by-product is meal, which is used mainly for poultry food and stock feed. About 7,000 or 8,000 tons of meal were obtained from the 27,000 tons of copra imported. The next by-product of crushing is coco-nut oil. About 17,000 tons or 18,000 tons of oil were obtained. Coco-nut oil is used for a wide variety of industrial purposes The bulk of it is used as fat for cooking, mainly in confectionery and biscuit factories. Some of it is used in the manufacture of soap and cosmetic and in some other industrial processes. In the production of table margarine, about 30 per cent, of the coco-nut oil would be used and something in the nature of a quarter or one-fifth of the total imports of copra. Only about one-third of the coco-nut oil is used in the production of table margarine.
– My question is addressed to you, Mr. Speaker. Is it a fact that the procedure of this House is similar to that followed in the House of Commons? Is it also a fact that permanent seats are not allocated to members of the. House of Commons ? If that is a fact, under which rules or precedents do you call honorable members of this House only when they are sitting in the seats allocated to them?
– I call honorable members in accordance with the Standing Orders. I suggest that the honorable gentleman look at them.
– I ask you, Mr. Speaker, whether it is a fact that all retail merchants in Australia have reduced the prices of their commodities in line with the reduced excise and customs duties? It is also a fact that there has been no reduction of the cost of similar articles sold in the parliamentary refreshment and the. dining rooms? Are members of the Parliament reserved for exploitation?
– If the honorable member is referring to the prices charged for certain bottled liquors in the dining room, I point out to him that the position is that last year there was a great shortage ‘of certain imported liquors, particularly Scotch whisky. The President of the Senate, of that day, and I, took steps to ensure that members’ requirements were adequately catered for. At a recent meeting of the Joint
House Committee it was decided that as honorable members had suffered no shortages during the last year, at least they should consume that part of thu stocks of the bar that had been obtained for their use at prices upon which the old duty had been paid. If we had done anything else we should have been asking the taxpayers to pay the duty so that honorable members could have their liquor more cheaply. We did not propose to do that.
– Has the attention of the Minister for Health been directed to statements made from time to time to the effect that his hospital benefits scheme is mainly one for healthy people and that others who are less fortunate are excluded from benefits under it ? Will the right honorable gentleman say whether that was true of the scheme at any stage ! If it were true at the commencement of the scheme, what is the position to-day?
– Such a statement was quite untrue from the beginning, and I am glad to say that with the progress of the scheme, whatever basis there might be for the exclusion of various classes is gradually disappearing. After the first six months of operation, the age bar was removed as an insurance-excluding factor. When the regulations were brought into effect that deal with the registration of insurance organizations, it was made compulsory for all such organizations to include in their benefits all people who developed diseases of a chronic nature after being insured. Then the various industrial organizations that are established in the Hunter Valley and the Port Kembla district, that is, the organizations associated with employment in the iron, steel and coal industries, were able to eliminate all waiting periods and all prohibitions with regard to chronic ailments. I am glad to be able to say that the biggest friendly society in Australia has now brought down a proposal under which cases of pre-existing disease may be insured, and after persons with those diseases have been in the insurance scheme for two years they will have gained an equity in the insurance policy and all cases will be treated as new diseases. Therefore, every month the position is being liberalized and soon the full cover available will be universal throughout Australia.
– I ask the Minister for Health to state the subsidy that is paid to approved hospitals in respect of pensioner patients who are not members of hospital contributions funds and those who are members of such funds. If there is a difference in the rate of subsidy paid by the Government in these cases, will the Minister explain why? “Will he also explain whether, if there is a difference, the rate increases when benefits from approved societies cease?
-The Government subsidy is paid in respect of pensioners in public wards of approved hospitals, whether or not the pensioners are insured, at the rate of 12s. a day, and it does not vary no matter how long the patient is there or what his illness is.
– I direct to the Minister for Health a question that is supplementary to that asked by the honorable member for Shortland. In view of the fact that the Government pays to hospitals in respect of pensioner patients an amount of 4s. a day in addition to thor payment of 8s. a day made by the Chifley Government, why does not the Government continue to pay the same amount to old people’s homes when pensioner patients are moved from hospitals to the infirmaries of such homes?
– In that respect the Government is only carrying out the policy that the Labour Government followed when it was in office.
– Can the Minister for Health inform the House whether the Government proposes to do anything to protect the interests of members of approved medical and hospital benefits societies by compelling such societies to give to their members the right to elect their officers, directors or boards of management, or to give them some control over the policy of the societies ? I instance the case of the Mutual Hospital Benefits Association of South Australia, which recently reduced from 10s. to 7s. 6d. the benefit previously granted to members in respect of doctors’ visits, but still continued to charge the same weekly contribution.
– There is no intention on the part of the Government to interfere with the internal management of these organizations, except to the degree that their benefits must at least match the benefits provided by the Commonwealth. During the two .years in which those organizations have operated in close association with the Government they have continually liberalized and extended the benefits provided for their members. In the instance mentioned by the honorable member, the reduction of the benefit was deliberately made in order to reduce the total payment to 13s. 6d. of the 15s. which is usually charged for consultations, thereby preventing the opportunities for collusion and fraud that would arise if full payment of the consultation charge was allowed. The reduction was made with the consent of all parties. One organization found that, by reducing the payment, it was able to provide ambulance services as an additional benefit. These are non-profit organizations and all the moneys collected by them are used for the benefit of their members.
– My question is directed to the Minister for the Army. Is it true that more than 300 Australian servicemen serving in Japan have married Japanese wives who are thereby entitled to entry into Australia? If that is so, has the Army done its utmost to try to prevent and discourage these undesirable unions by strict non-fraternization rules ?
– Every discouragement that could be reasonably applied has been applied. I have made public statements about my attitude, and about the advice that I have tendered to the lads. Moreover, both senior, and junior officers, have pointed out to the men that the enthusiasm of the moment might be regretted later in life. Again, no serviceman can marry unless he makes an application and indicates his wishes. That gives another opportunity to reconsider the. matter. It is far better for the service men to marry Australian girls than those in foreign countries, particularly in Japan. There is no doubt about the attitude of the Army, and myself, towards this matter. Those who are married can bring their wives to Australia after making application to the Department of Immigration.
– I ask the Minister for the Army whether it is a fact that a very serious development has occurred in relation to the pay-roll robbery charges in Japan. It is a fact that many more Army personnel are involved than was at first suggested? Are such personnel in high official positions? Is it also a fact that a considerably larger amount than £60,000 ia involved? What is that amount?
– The answer to every one of the questions asked by the honorable gentleman is “No “.
– Will the Minister for Supply tell me what equipment has been installed by the Government to measure the greatly increased amount of radioactive particles that will be present in the atmosphere over Australian cities as a result of the forthcoming atom bomb test to be’ made at Woomera? Has the Government taken any action in this regard to allay public fears about the test, or has it left such action to the good sense of isolated universities and individual scientists ?
– I do not believe that there are any fears in the mind of the Australian public regarding the matter the honorable gentleman has mentioned. It has been stated repeatedly that every precaution has been taken to ensure that the atomic test that will take place some time in the future will not in any way affect the Australian people.
– Has the Minister for the Interior under consideration a proposal for the establishment in the Australian Capital Territory of an agricultural college? A proposal for the establishment of such an institution was submitted to the Minister for Commerce and Agriculture by the Australian Capital Territory Rural Lessees Association.
– I think tha: the answer to the question is that such a proposal has not, up to the moment, received any serious consideration. However, I shall refer to the previous requests made, and shall discuss the matter with the honorable member later.
– As there is a strong demand by sections of the community for the broadcasting of classical music over national stations, which is particularly restricted while the parliamentary proceedings are being broadcast will the Postmaster-General give consideration to the introduction of a third programme to be broadcast over a national network while parliamentary proceedings are on the air?
– Considerable attention has been given to the provision of such a third programme. Unfortunately, however, the financial circumstances of the Australian Broadcasting Commission do not at this stage permit the introduction of such a programme.
– Has the Minister for Health considered taking action to prevent the importation of sub-standard drugs into Australia? Is it a fact that health inspectors have discovered that drugs which are 50 per cent, below standard are being provided under the pharmaceutical benefits scheme, and that some Australian-produced drugs are equally as inferior as sub-standard imported drugs ? Will the Minister take the necessary steps to prevent unscrupulous exploiters from using this national scheme to the detriment of the people ?
– It will please the honorable member to know that the action which he suggests was taken two years ago under the provisions of the Pharmaceutical Benefits Act. A research body has been established in the Department of Trade and Customs to deal with this matter, and there has also been established in -the universities -of Sydney and Melbourne ‘research organizations which work in association with the professors of pharmacology to -ensure that no substandard ‘drugs are used. The Department of Trade and Customs can deal with imported drugs. The .Government oan deal with ‘drugs “provided by the -Commonwealth under the Pharmaceutical Benefits Act. But in order to. ensure that completely pure drugs shall be available in Australia -for : all purposes, the ‘Government proposes to introduce a therapeutic substances bill which lias been drafted in collaboration with the States. It will include the whole area covered by the Commonwealth and State constitutional powers and it will leave no loophole untouched.
_ Mr. WENTWORTH.- Has the attention of the Minister for Air been directed to a new method of aerial “photography developed in the United States of America whereby ail movement of the film is synchronized with the movement of the aircraft and a continuous strip of film, instead of single prints, is obtained? While I understand that this method is not readily adaptable to stereoscopic work, it has gome advantages. Will the Minister state whether the Royal Australian Air Force is investigating these developments’?
– I cannot remember the full details of the latest developments in aerial photography and aerial survey work. I know, as the result of a submission which I made to Cabinet .some time ago, that the matter has been considered by the Royal Australian Air Force. I know that the new methods of aerial survey photography, the purpose of which is to cover up the gaps and enable the work to ‘be carried out quickly, have been adopted or are known to the Royal Australian Air Force. I also know that the ‘stereoscopic method is being examined, “but I do not know whether it Iras actually ‘been introduced into the Royal Australian Air Force. I have a file on these matters in my office, and if the honorable member for Mackellar would like ‘to examine it, T shall be happy to make it available to him.
– My question is addressed to the Postmaster-General. Is it a fact that a number of female employees, whose ‘ services with the PostmasterGeneral’s Department have been terminated, have .been denied payment in lieu of furlough in accordance with the Commonwealth Employees’ Furlough Act. Is it also a fact that those employees have given satisfactory service for years, and have been refused payment on the ground that they have been replaced, and not retrenched, in accordance with the definition contained in the act? If that is not the reason for the rejection of their claims, I should like the PostmasterGeneral to -state the exact position.
– The request made by the retrenched, dismissed or replaced female employees in the PostmasterGeneral’s Department for -certain furlough rights is now being investigated by my department, and a final decision on the matter will be made shortly.
– I desire to ask the VicePresident of the Executive Council, who is in charge of the House, the reason for the absence of the Treasurer. la the right honorable gentleman absent ‘through illness? When is it likely that he will take his place in the “House??
– As the Leader of :the ‘‘Opposition ‘knows, ‘the Treasurer has been suffering i!3 health, and .has been under great .nervous strain for some time. I .understand ;that his condition .has improved, and we expect -to see him in the House next week.
– ‘Oan the Minister for Commerce and Agriculture inform Ill( whether an imported table margarine known as daffodil margarine is being sold by storekeepers in various parts of Australia as being the equal of butter, and that because it is cheaper, the sales o’f this commodity are greatly ‘increasing? Is any restriction placed on the quantity ‘of this product .that can be admitted ‘to the. country, and is there ‘any danger to the ‘dairying industry as a result of increased sales of daffodil margarine? Is it a fact that some medical authorities in England have expressed the view that the high consumption rate of margarine, because of the butter shortage in that country, has been the cause of rickets and stunted growth in English children through the absence of butter fat in their system? If those are facts, will the Minister take action to safeguard the health of our children, and the dairying industry, by placing further restrictions of the entry of this product into Australia?
– I have no knowledge of the quantity, or description, of any imported table margarine, but I thank the honorable member for Shortland for drawing my attention to this matter. I have no doubt, and I believe that the people of Australia generally share my view, that for health considerations butter is far superior to margarine, as an item of diet. I shall certainly have inquiries made about the imported margarine to which the honorable gentleman has referred, but I point out to him that the production ,of margarine in Australia, which is substantial at the present time, can be controlled only by State action. Unhappily no limitation seems to have been imposed on the manufacture of margarine in Queeusland.
– by leave - The Overseas Telecommunications Commission (Australia) maintains a relay cable station at Fanning Island, which is in the distant Pacific about 5,000 miles from Australia and off all sea and air routes. I received a communication last night from the general manager of the commission which informed me that the senior technician at the Fanning Island Station, a Mr. Giles, was dangerously ill and that the doctor had reported that, unless cortisone could be obtained immediately, his chances of living would be very slight. The only reasonable way of getting the drug there was to have it flown from Honolulu, which is about 1,500 miles from Fanning Island and, of course, is a United States base.
I received the message about 10 o’clock last night. I communicated at once with the United States Ambassador in Australia, Mr. Peaslee. and told him of the circumstances. He immediately communicated by radio-telephone with the admiral in charge at Pearl Harbour and the general officer commanding at Wickham Field. They procured cortisone and despatched a United States aircraft immediately to drop the drug by parachute. I understand that the machine reached Fanning Island about the same time as this House assembled this morning. I thought that I should supply this information to the House as soon as possible and express the appreciation of the Australian Government, the Parliament and. people to the United States authorities for their great assistance.
– by leave - I thank the Postmaster-General (Mr. Anthony) for having informed the House of this, matter. I associate the Opposition with his expression of gratitude to the United States of America for this remarkable feat of co-operation.
– I wish to make a personal explanation. I was not present in the House last night when the honorable member for East Sydney (Mr. Ward) made a statement about an alleged telephone connexion to a pineapple plantation in which I am interested at East Ballina. I understand from the newspaper report that I saw this morning that the honorable member said that I had arranged for an overhead wire to be erected over a considerable distance in order that this farm might be connected by telephone to the detriment of people who had outstanding applications for telephone connexions. The fact is that this farm still is not connected to the telephone service. Perhaps the honorable member for East Sydney was confused by the fact that a man whom I employ, who resides at East Ballina, and about half a dozen other people in the same area recently obtained telephone connexions. The service has been extended there because East Ballina is a growing suburb of Ballina and many of its residents have applied for telephone installations. There is no truth in the statement that my farm at East Ballina has been connected to the telephone service. In fact, in reply to my representations to the Postmaster-General, I have received replies which promise me that, at a distant date, the farm may be connected on the same terms and conditions as apply to everybody else in Australia.
SUPPLY. (“ Grievance Day.”)
Postal Department - Members of Par liament - Wheat - Compulsory Unionism - Preference to exServicemen - Economic Situation - Parks and Playgrounds - King George Park - Office Accommodation - Public Works - Order of Business - Housing - Public Accounts Committee - National Development - Government Loans and Finance - Censorship of Literature - Telephone Services - Shipping - Social Services - Armed Forces.
Question proposed -
That Mr. Speaker do now leave the chair and that the House resolve itself into a Committee of Supply.
.-I refer to a matter which affects the work of every member of Parliament in his electorate. Most honorable members do a great deal of work in their electoral divisions, as I do. Last year, I took the trouble to visit every town and village in the electorate of Ballarat.Forthe purpose of my tour, it was necessary to advertise in advance the dates and times at which I would visit various centres. Therefore, I sent to every post office in the electorate a small card setting out the date and time at which I would be at that post office so that anybody who wanted to see me could do so. The tour was extremely fruitful and beneficial to the people of the area, particularly age and invalid pensioners, repatriation pensioners and others who have difficulty in travelling. The Ballarat division may be considered to be small, but it covers 500 square miles and extends for a distance of approximately 40 miles around Ballarat. I repeated the tour this year. Last year I took the trouble to hire local halls wherever possible so that, in wet weather, there would be shelter for people who wanted to meet me. However, in many instances there was little business for me to transact and I found that the hiring of halls was superfluous. I was able to conduct interviews in my motor car when the weather was wet. Therefore, I did not hire anyhalls this year, but I sent cards to 39 post offices, most of which are unofficial post offices. These cards were in the same form as the cards I distributed last year and notified people of the dates and times at which I would be at different places. They also informed electors who might wish to see me that, if they could not come to meet me, they should leave their names and addresses with their postmasters so that I could call on them. I sent a card with a courteous letter to every postmaster.
The first reaction came from the postmaster at Creswick, who telephoned me and said, very decently, that it would be contrary to postal regulations for him to display the card and that he could not pin it up at his post office without first referring the matter to the District Postal Inspector. I told him that I did not want him to do anything against the postal regulations but that I thought the display of a small card for a few days would not be contrary to the regulations. However, I agreed that he should refer the matter to the District Postal Inspector, and he did so. I commenced my tour according to schedule during the following week. At the first place that I visited, which was Ballan, the postmaster said that he had been notified at first by the District Postal Inspector that he must not display my card, but that later this ruling had been reversed on the ground that the card was small and would serve a useful purpose so that no harm would be done by displaying it. Because of the original decision, the card was on display only for a day or two. I completed my tour. However, I was disappointed later to learn that one postmaster was considerably disturbed because he had received a quastionnaire containing a list of eight or nine questions. He had been put on the spot properly. As far as I can remember, the questions were -
I cannot remember all the questions, but I know they embarrassed postmasters who bad done only a simple job for the benefit of the community. I want to know whohas objected to or found fault with a simple service such as this. I know that no supporters of mine have objected to it. They were all very pleased to see me. They like to see me out there.I should like the Postmaster-General to deny emphatically that the person who objected was the Leader of the LiberalCountry party in Victoria. I went into his electoral division, and’ I should like to be assured that he did not object to what was done. I want to know who is making an issue of a simple request to postmasters and embarrassing perfectly honest people who have rendered a service to the community. I do. not think they should be embarrassed in this way. It is shameful that they should be put on the spot for displaying cards of this kind. I want to know who is putting senior officers on the mat because they authorized the display of the cards. I want to know who is treating a small public service as a crime and suggesting that postmasters who have acted as the best of public servants are wrongdoers.
It may be argued that the practice of sending cards of this kind to post offices will become prevalent and throw extra work on postmasters. But I point out that only a few Federal and State members visit any one electoral division, and it is unlikely that such visits would throw much extra work on the post offices infill at division. If this practice did cause extra work for postal officials, the time to deal with it would be when it became a nuisance: There was no congestion at any of the post offices that I visited. I saw nearly everybody outside the local post office, or in my car. The only place at which there was a crowd was Morrison, where 25 people came to meet me. Their principal complaint related to a lack of postal and telegraph services. On that occasion, we adjourned to the local hall.
It may be said that the display of a card of this kind in a post office might indicate some political partisanship on the part of the postmaster concerned. There would be no substance in such an argument. In theUnited States of America, thename of every parliamentary representative of the people of any area is posted up at the local post offices.I believe that should be done also in Australia. The names and addresses of Federal, State and even municipal representatives for an area should be displayed in the post offices in that district. The people should know where they, can get in touch with their representatives. That information should be displayed in post offices as far as possible. Most of the people that I represent live a long way from towns. Their meeting place is the local post office which, in country districts, as. every honorable member knows, is often just a house in a hedgerow. They go to the local post office to collect their mail, and they learn what is going on in their district. If a card were displayed in the post office stating that the federal member would be in the district at a certain time on a certain date, it is almost certain that the whole of the district would soon learn of his visit. I believe that, as a service to members, post, offices should display notices of that. kind. I should like the Postmaster-General to ensure that all postmasters who have displayed cards are thanked for their co-operation. They should not be put on the mat for having done so. It should be made perfectly clear to them that they have done nothing wrong,, but have rendered a service to the community for which the Government is grateful.
– I call the honorable member for Mallee (Mr. Turnbull).
– Mr.. Speaker-
– Order ! Before we proceed further, I think we should reach some understanding about procedure. I point out that if the Postmaster-General (Mr. Anthony) replies now to the remarks of the honorable member for Ballarat. (Mr. Joshua) he will be unable to reply to remarks made later by other honorable members.
– iM-ay I mention that I intend -to .refer to the ‘.Torrensville post office?
– I shall be interested to- hear ‘the reply by the Postmaster-General (Mr. Anthony) to the remarks of the .honorable member for Ballarat. If the Minister says the actions of the honorable member are in order, he will open up a cheap way for members of the Parliament to notify their constituents that they intend to visit certain localities. I do not know any member >of the Parliament who has adopted this method of .notifying his .constituents that he will visit them. It is quite a new method to me.
Mr. Wheeler interjecting,
– I have not heard previously of members of the Parliament asking a postmaster to display a notice to the effect that they will ,be visiting certain places. I do not care what other honorable members say. I have never known that to happen before.
– The honorable member should go to New South Wales.
-Order’! I insist that the House maintains order. I shall not permit a running fire of interjections. If interjections continue, some honorable gentlemen will find themselves outside the building. It is a beautiful day.
– The PostmasterGeneral will either approve or condemn this practice. It has been adopted by an honorable member who represents a Victorian electorate, hut evidently the practice is supported by an honorable member from another State. I suggest that a very simple way to inform electors of a visit is to insert a notice in the local newspaper. Honorable members should not be frightened of the few pence .that such an advertisement would cost them. The method to which the honorable member for Ballarat has referred may be the thin .end of the wedge. Where should we draw the deadline for the use -of post offices as a medium of political advertising? Should we say that notices of this kind should not ‘be -accepted within three months, -or three days, of an election? I believe we should say that they should not :be accepted within ‘three years of .’am election. No difficulties would arise then.
I want ‘-to deal with the position that has arisen as a result of Victoria and Queensland agreeing to a uniform -price for wheat sold for ‘human -consumption in Australia ‘and entering into a ‘Commonwealthwide ‘scheme for the orderly marketing of whea’t. It has been suggested, not only an the Victorian Parliament but also in ‘this Parliament, tha’t the very slight proposed increase of .the price of wheat to which Victoria and Queensland have , now agreed cannot be justified because it will .cause a big increase of the cost of living; and .stimulate inflation. It has been said with authority that .the cost of production of .wheat for the next year has been calculated to be approximately 12s. 6d. a bushel. The new price for wheat consumed locally will be 14s. a bushel. The .difference between the cost of production .”figure and the mew home-consumption price is ls. 6d. a bushel, which represents approximately £d. increase of the price of a 2-lb. loaf. It is clear, therefore, ‘that the mew homeconsumption .price will not cause ;a tremendous rise of the cost of living.
Mr. Curtin interjecting,
– We all know that the proposal to pay only the cost of production figure was another of the attacks upon wheat-growers that have been made so often by people such as the honorable member for Watson (Mr. Curtin), who represents wheat consumers in a metropolitan >area. Apparently the honorable member for Watson, the honorable member for East Sydney (Mr. Ward) and, unfortunately, the Premier of Victoria, believe that the wheat industry should operate on the basis of .the cost of production. Can anybody inform us of any other business or . undertaking in Australia that is operating, and continuing in operation, under a Cost of production system? Of course -nobody can point to any such industry, but honorable members opposite are inclined to believe that -by -this system they could get a loaf of bread at a half-penny cheaper and so they .are .willing to condemn the wheat-grower who, bv keeping the price of wheat down, lias done so much to ensure that the economy of Australia shall be prosperous. During the last ten or twelve years the wheatgrowers have contributed more than £200,000,000 to the Australian economy by selling wheat at the cost of production. If they had sold their wheat on the world market they would have been paid £200,000,000 more than they have received. Consequently, it is quite plain that the Opposition’s attack on the wheatgrower is completely unjustified.
We must foster our wheat industry, which is our second most lucrative export industry. If we force wheat-growers to accept a price which is the cost of production, we shall not keep our wheat, production up, as we must do if Australia is to have a balanced economy. People have said that lately the wheat-grower has been wonderfully successful and prosperous. That is correct. However, it is only correct because he- has had good seasons. We must remember that this country experiences severe droughts, and although we have had eight good seasons, which constitute a record in the history of this country, at any time in the future the wheat-growers may suffer a drought. Next year, for example, the wheat-growers may sow their grain at a comparatively high cost, because the machinery that they use is expensive and its price is fixed according to the industrial laws, but he may not reap one grain of wheat. The same thing may occur the following year. Therefore, surely honorable members opposite realize that wheat-growers must build up a reserve in order to carry them over bad seasons and keep the industry in operation. But the Labour party wants to keep the wheat-grower down, and wants to pay him at the rate of the bare cost of production of wheat. Honorable members opposite do not want to see the wheat-growers making any profit; they do not want to see wheatgrowers with any reserves and apparently do not want the industry to remain on a stable foundation. Of course all their arguments in this respect are quite illogical, and the people should be informed of that fact, so that they will become fully aware of the attitude of the Labour party and of what is happening in this country.
I now desire to refer to the Labour party’s policy on compulsory unionism and preference to ex-servicemen. How will compulsory unionism, and the consequent preference to unionists, affecT. ex-servicemen? Honorable members opposite should inform the House whether compulsory unionism will nullify preference to ex-servicemen. One honorable member opposite has said that it will not affect .preference to exservicemen because, if an ex-serviceman becomes a member of a union, he will get his preference as a unionist. I certainly do not want to see men who fought for freedom, and who do not want to ho tied up in the unions, put out of employment. Listening to the speeches made by honorable members opposite yesterday, one would have believed that they had the welfare of the ex-serviceman at heart. If it comes to a matter between preference to unionists and preference to ex-servicemen, where do they stand ? Is there one honorable member opposite who has the courage to say, “ I believe at all times that there should be preference to ex-servicemen, irrespective of compulsory unionism or anything elsethat may come before the executive of my party “. They say that first of all «. returned soldier must join a union, and that then he will get preference along with other unionists. Therefore, it is quite clear that honorable members opposite hold sacred the membership of a union above everything else, and their present utterances are a complete contrast to their recent speeches in which they cried out for increased pensions for ex-servicemen.
I believe that the Opposition should also make a public explanation about its prophecies of a great depression that would envelop Australia at this particular time. Twelve months ago Opposition members said that within a short time this country would be in a state of great depression, but only the day before yesterday one member of the Labour party said that we had reached the height of prosperity. If any one should accuse the Government of attempting to bring about a depression, and then events prove his prophecies to be completely untrue, he should be big enough, broad-minded enough and manly enough to stand up and say that because the depression has not arrived he was quite wrong. The whole world knows that the Labour party has been wrong in its croakings about depression, and we all know that the Government’s activity to ensure prosperity in this country will be effective as long as this Cabinet occupies the treasurybench. However, this Government takes uo responsibility for what might happen if, by a miscarriage of justice, the Labour party should ever again form a government in this country.
– Order! The honorable member’s time has expired.
.- During the war years, because of power conferred on it by the National Security Regulations, the Australian Government took over a considerable amount of property in the form of parklands and playgrounds from various municipalities throughout the Commonwealth. Since then, to the present time, the Government has remained in occupancy of those lands and has each year made an ex gratia payment to municipal councils in respect of such occupancy. When the Australian Government first moved on to these lands it gave an undertaking that at the end of the war the lands would immediately revert to the municipal councils. It is because the Government has failed to honour that undertaking that I address myself to this question, which vitally affects a part of my electorate known as King George Park. I recently received a letter about the matter from the Town Clerk of the Municipality of Leichhardt, and I desire to read it to honorable members. The letter is dated the 18th September and reads -
I refer to the Commonwealth Government’s occupation of portion of King- George V. Park. As you are no doubt aware, the Commonwealth has been in occupation of portion of this park for many years now, having exercised its powers so to occupy by virtue of National Security Regulations.
The Department of the Interior recently wrote to Council requesting that a permissive occupancy be granted to the Commonwealth over the section they have occupied. It was explained that the occupancy was at present covered by the above-mentioned regulations and it was the desire of the Commonwealth that these regulations should be cancelled.
Council, in reply, advised the Department that it was not prepared to grant a permissive occupancy and that it desired that the Commonwealth occupation of the park should be terminated at the earliest possible date. This letter went forward to the Chief Property Officer of the Department of the Interior on 20th May this year but so far no reply has been received. It has been established by expert investigation that the Municipality of Leichhardt is short by 24.0 acres of parkland area, in relation to its population. Council considers this to be a very serious state of affairs and is desirous of correcting the situation if at all possible and is certainly absolutely opposed to any whittling away of parklands now in existence. Council feels sure that you will appreciate the situation and support it in this matter.
It has now come to Council’s knowledge that a proposal has been put forward by the Electricity Commission of New South Wales for the establishment of a road of access through this part. Should this proposal materialize the parkland available in this area will be still further reduced. I am sure you will agree that this is a most undesirable state of affairs.
Any representations which you are able to make on Council’s behalf would be greatly appreciated.
King George Park is in Rozelle, New South Wales. Rozelle is a congested industrial area, and its parklands and playing areas are very few. I also bring to the notice of the House the policy of the Government on the matter of vacating these parklands, after it had informed municipal councils that it would do so many years ago. It seems to have become a part of high Government policy to remain in occupancy of these parklands notwithstanding the earlier promises. On quite a number of occasions I have accompanied deputations to the relevant Ministers from different municipal councils with the object of trying to ascertain from the Government just what its intention is. We have now reached the stage at which when one department completes its use of the sheds erected on the King George Park, another department moves in. Also, when we approach the departmental heads about the matter they ask us to put forward an alternative to their occupation of the park, or to suggest where they might get other suitable accommodation. They also argue that it is not merely a matter of them vacating these parklands, but it is also becoming a matter of economics so far as the Commonwealth is concerned. Therefore, it appears that the Australian Government is lending itself to a practice of deliberately filching playgrounds and parks from the people under one pretext or another. Departmental! heads- are not anxious to have Commonwealth offices moved’ from these areas, particularly those in the. inner city area of Sydney.. They aTe interested in- running, their departments as’ economically as possible, and- they do not hesitate, to say that iftheir offices were moved, further out of. the city the costs of the departments would increase.
The return of parklands and’ playgrounds to use for their original purposes is vital’ to peopl’e who live in thickly populated industrial areas. The Commonwealth’s occupancy of these areas is a flagrant example of the dishonouring of a definite promise. The Commonwealth, promised the municipal author!: -ties, when it moved into these areas, that it would move out again as soon as emergency conditions- were over. I ask the Minister to examine this problem, especially in relation to the area that .1 have mentioned, although I know that many other municipalities suffer from the same disability. I urge on the Minister the need for a firm decision how long the Commonwealth intends to remain in occupancy of municipal areas, and when it proposes to honour its definite undertaking that it would get out of such areas as soon as possible.
.- I wish to impress on the Government the need to increase its endeavours to achieve a balanced system of public works priorities throughout, the Commonwealth, under which the most essential State and Commonwealth works will be carried out first. Honorable members know that this proposal has been made on numerous occasions’ at conferences of Commonwealth and State Ministers but has- been rejected by the States on the ground, that, each State knows its own requirements much better than any other State- or the Commonwealth can know them-.. That argument appears to be logical, but it has not had- satisfactory results- in. practice. The result of a lack of a co-ordinated public works programme throughout the Commonwealth is that the individual States and; the Commonwealth compete for the man-power, materials and finance available for public works.. .Such unnecessary competition leads to waste.. Both the competition and the waste it involves could.’ bc obviated, by a. priority scheme to cover the public works of all the States and the Commonwealth. I know that the States can always find’ objections, to any such scheme, but I forsee, unless such a scheme’ is adopted) a- recurrence of our past experience, when, the Commonwealth and the States scramble for the available man-power, material and finance; because there is at present a growing demand f ov unskilled labour. Competition for the finance for public works is already manifesting itself. If we do: not implement a scheme of priorities we shall have a repetition, within the boundaries of the States themselves, of the experience in Victoria only a few years ago when State instrumentalities such as the State Rivers and Water Supply Commission, the Kiewa project, the railways and the tramways were competing for men, materialsand finance, with chaotic results. The people themselves are entitled’ to be indignant about the lack of planning, anr!1 the bad planning, of public projects.
Only last week I directed the attention of the House to the fact that valuable plant in the Latrobe Valley was being allowed to deteriorate. I was. amazed to discover that the. Minister in charge of electrical undertakings in Victoria had’ denied the truth of my statement. Later, however, he had to retract his denial and apologize for having made it. He said that he had been misinformed ,by his advisors in the State Electricity Commission. That kind of mumbo-jumbo explanation has been used for too long, by Ministers who are in control of large undertakings. They use it to allay the fears of the public about what is going on. Such attempts to pull wool’ over the eyes of the taxpayers have been going on for a long time in some- States; particularly Victoria. The Minister to whom I have referred made that, categorical denial,, and letters denying his statement’ appeared in. Melbourne newspapers, and he had to admit later on that I was right. The statement that I made, the truth of which the Minister denied, was. that £12,000,000) worth of plant waslying idle in the Latrobe Valley, and that much of it was deteriorating and would have to be replaced when it was required for use.
Victoria provides a good example of the need for a system of priority in public works. The Victorian Government is at present engaged in building an electric tramway track down the main street of Melbourne to replace an existing bus service. That work is to cost £2,000,000. Surely the provision of protection for the equipment that is deteriorating in the Latrobe Valley should be given priority to the building of a tram track. E understand that certain authorities in Victoria have suggested that the shells of buildings that will be later used for power houses should be erected in the Latrobe Valley in order to house that equipment until it is required or until it is necessary to install power house equipment in the shells. It is logical that an amount of, say, £500,000 should l>e used to build such shells, for future use and for the present protection of this valuable equipment, rather than that £2,000,000 should be expended on the provision of a tram track which is not vitally necessary. If the taxpayers saw what was going on in the Latrobe Valley they would support my statement regarding the necessity for a priority scheme, under which first things would come first. We should concentrate on the building of projects that will produce power rather than on the building of tram lines that will not produce one unit of power. I hope that the Minister for Works (Mr. Kent Hughes) will ask the Prime Minister (Mr. Menzies) to make another attempt to evolve, in consultation with the States, a. sane system of priorities for public works throughout the Commonwealth and, thus avoid the waste and unnecessary competition that prevails at present.
– The Government, in refusing to afford to honorable members reasonable opportunities to express their thoughts on many matters which affect their constituents, is deserving of the strongest criticism and censure. Last week a very urgent matter which affects one of my constituents and her four young children was brought to m.y notice in this chamber by telegram. Although I had emphasized its urgency to the Vice-President of the Executive Council (Mr. Eric J. Harrison), immediately after I had risen to discuss it on the motion for the adjournment of the House, the right honorable gentleman moved the closure and effectively gagged me.
– Order ! The honorable member is not in order in challenging a vote of the House. The vote on the motion for the closure was taken and it cannot be referred to in this debate. Mr. LUCHETTI. - I do not challenge the vote but I object to the policy of the Government in stifling the discussion of matters which are of the utmost importance to the electors. “ Any government worthy of the name would ensure ample opportunity to honorable members to bring before this chamber matters which seriously affect the lives, hopes and aspirations of th’e people whom they have the honour to represent. The matter to which I referred relates to eviction of a family from their home which, if it is not important to some people who occupy influential positions on the Government side of the House, is of the utmost importance to me and to the unfortunate family concerned. In this instance a woman and her young family were forced to leave their house and live in a panel van. Their plight was desperate because they had no breadwinner to care for them. I refer to the matter now, not because I believe that anything can be done at this stage, but because I hope that by ventilating it I may influence the Government to prevent similar occurrences in the future. The Government forced the woman and her young family to leave a Commonwealth building which provided ample and adequate accommodation for them. I protest at the behaviour of the Government in selling for removal at peppercorn prices buildings which cost, in some instances, hundreds of thousands of pounds to erect and which are quite suitable for accommodation. It is high time that the Government realized that its lavish and uncontrolled spending has angered the people. Although the Public Accounts Committee investigates the activities of Government departments, too often its investigations are conducted v-P8T« after the money involved in the erection .of buildings has been expended. The committee is not permitted to inquire into departmental policy which may motivate high government officials in deciding to erect buildings or to dispose of them. Thanks to the New South Wales Government and the Kew South Wales Housing Commission the woman and her family, to whom I have referred, are now accommodated in a house. I leave the matter there.
I record my protest at the very rare opportunities that are given to members to air grievances which affect their electorates and the nation generally. During the lifetime of this Parliament, honorable members have been given an opportunity to air their grievances on only three occasions. If the Government and its supporters are happy about that state of affairs, we are not. We protest most vigorously against the manner in which, the affairs of this House are conducted by the Government and in particular by the VicePresident of the Executive Council. On only one day in each of the three years that this Government has been in office have we been given an opportunity to bring before the Parliament urgent important matters which affect our constituents. Because of the enlarged Parliament and the manner in which the Government presents its business to the House it is impossible for honorable members adequately to consider the legislation that is placed before them or to give appropriate consideration to recommendations for the appropriation of moneys for the purposes of the Government. Having regard to your ruling, Mr. Speaker, I presume that I should not be in order if I referred to the manner in which the Estimates were recently dealt with in this chamber. Honorable members who participated in the discussion of the Estimates will recall-
– Order! The honorable member is getting right outside the Standing Orders now.
– I am. sorry if I have transgressed, Mr. Speaker. I merely wished in passing to direct attention to something that occurred in this chamber when it was not under your control. In view of your ruling, I shall leave that subject and discuss the dictatorial fashion in which the affairs of this House are conducted by the Government. During the lifetime of this Parliament the “ guillotine “ has been applied on no fewer than nine occasions and the closure has been moved on no fewer than 170 occasions.
– That is a world’s record!
– I am not aware whether or not it is a world’s record but it virtually means that honorable members are disfranchized because they are prevented from giving to the Parliament the benefit of their experience in their electorates in relation to matters which are of the utmost concern to the nation.
I propose now to discuss the urgent need for the formulation of a Commonwealth housing programme. When the subject of housing is discussed in this chamber the discussion is usually limited to an apology by members of the Government and an emphasis on the responsibilities of the States in this matter. The Commonwealth proposes to build only approximately 77 houses-
– Order ! The honorable member is now dealing with the subjectmatter of two bills which are on the notice-paper. The subject of housing is outside the scope of this debate.
– If I have again transgressed the standing orders I shall not proceed along those lines.
There seems to be a complete lack of a developmental plan to embrace the needs of Australia as a whole. We seem to deal with the problems that affect the nation only in a piecemeal way. The honorable member for Isaacs (Mr. Haworth) referred to the need for the Commonwealth to co-operate with the States in respect of developmental projects. If we are to progress Ave must forget that we are Victorians, Queenslanders, Tasmanians, South Australians, Western Australians, or New South Welshmen, and remember only that we are Australians and that we have a big job ahead of us to develop, not one State, but the whole of Australia. We must abandon the narrow State point of view and develop a wide national outlook. Developmental plans are submitted to us from, time to time but they rarely progress beyond the talking stage. Usually they are introduced on the eve of a general election but after the election is over no practical action is taken in relation to them. The position in the north of Australia is most unsatisfactory. This region is more than five times as large as Victoria, and is bigger than the combined areas of New South Wales, Victoria and Tasmania, yet fewer people live there than reside in some of the larger towns in my electorate.
– Order ! The honorable member’s time has expired. I call the honorable member for Henty (Mr. Gullett).
– Mr. Speaker-
Honorable members interjecting,
-Order! Does the Postmaster-General insist on his right to receive the call?
– I shall be brief.
– The PostmasterGeneral may proceed.
– I shall reply to certain matters that have been raised in this debate.
– I rise to order. If the Postmaster-General replies to the debate now, will other honorable members be prevented from raising any matters relative to the Postal Department ?
– I also rise to order.
– The honorable member for Hindmarsh (Mr. Clyde Cameron) is wasting time.
– Order ! The honorable member for Hindmarsh is entitled to be heard on the point of order.
– If the PostmasterGeneral speaks now, will he be prevented from replying to matters raised by later speakers relative to the Postal Department ?
– I have appointments outside the House which I must keep, and, consequently, I take this opportunity to reply to matters that have so far been raised in the debate. The honorable member for Macquarie (Mr. Luchetti) has complained that he has not been given sufficient time to ventilate grievances in this House, and that other honorable, members are in as similar position. I remind that honorable gentleman that the debate on the budget commenced on the 8th September last and concluded on the 8th October. During that period, the whole time of the chamber was devoted to the consideration of the budget and the Estimates.
– In view of the number of honorable members, that period was not long.
– Honorable members had the right, for a month, to speak on almost any subject under the sun. They could have raised any matter that was near and dear to their hearts. The debate on the budget and the consideration of the Estimates always provide the opportunity of the year for honorable members to ventilate their grievances. The honorable member for Macquarie, if he had wished to raise a matter of special importance, could have discussed the position with the Leader of the Opposition (Dr. Evatt) or the honorable member for Melbourne (Mr. Calwell), who is the Deputy Leader of the Opposition, and I think that an arrangement could have been made for him to receive a call. But even if an honorable member did not take advantage of his opportunities during the debate on the budget and the consideration of the Estimates, he could have raised a matter of importance on the motion for the adjournment. Consequently, an honorable member has plenty of opportunities to bring matters before the House, if he really desires to do so.
The honorable member for Ballarat (Mr. Joshua) has suggested that postmasters throughout Australia should be required, or permitted, to act as agents, as it were, for members of this Parliament. He has pointed out that senators and members of the House of Representatives in the United States Congress, and members of the State legislatures, have this service available to them. I sincerely hope that we in Australia will not adopt the practices in the United States of America in respect of the employment of postmasters. One of my reasons for making that statement is that a postmaster in the United States of America is the appointee of a senator or member of the House of Representatives, and vacates his position when the senator or member is defeated. We certainly do not want a similar system of appointments and retirements in this country. We all feel that our public servants are completely removed from politics in the discharge of their duties. That situation is roost desirable. If postmasters in Australia are to be required, or permitted, to represent members of this Parliament, irrespective of the political parties to which they belong, and take down complaints, as the honorable member for Ballarat has requested that they should do-
– I did not make that request.
– The honorable member requested that postmasters should take down the names of people who called to interview a federal member, and it must naturally follow that. m postmaster would be the recipient, in the absence of an honorable member, of the complaints of the persons who called to sue him, and would be asked by the electors, who probably could not wait, to take down their complaints and forward them to the member. Our post offices are not to be used for that purpose. Many of us have been members of this Parliament for a considerable time, and I doubt whether any of us seek to use the services of the Postal- Department and the staff in that way. An honorable member who represents a country electorate usually publishes a notice in a local newspaper that he will be at certain places at certain times. I see no reason why he cannot use a post office corner, a business place or an hotel room as a meeting-place where lie can interview his electors. I do so when I am visiting country districts. I do not consider that postmasters should be required to perform the duties suggested by the honorable member for Ballarat. If they were required to do so, the next step would be that a member of this Parliament would want to push a postmaster out of his office so that he could interview his electors in it. When this matter was referred to me, I said that such concessions were not to be given to any honorable member, regardless of the political party to which he belongs.
– What would be the position during an election ?
– During an election, the same concession should be given to a candidate who is not the retiring member. When all is said and done, an honorable member is trying to serve his constituents, but at the same time, he is trying to serve himself by making it known that he is most active in their interests. It is not intended that post offices and postmasters -should be used for these purposes. If an honorable member who represents a city electorate wishes to interview some of his constituents in the General Post Office, we may set aside a special place, but at the present time he can only say, “ I shall meet you under the clock “.
– I desire to make a personal explanation.
– Does the honorable member claim that he has been misrepresented ?
– Yes. The PostmasterGeneral (Mr. Anthony) stated that I required postmasters to take down the complaints of persons who wanted to see me. I did not -make such a statement. The people were asked to leave their names with the postmaster so that I should know who had been inquiring for me, and, if necessary, I could call on them.
, - I welcome the opportunity provided by “ Grievance Day “ to ventilate my grievances. Unfortunately, I have so many grievances that I cannot possibly state all of them in ten minutes. I remind the Government that only half of the number of members of this House got an opportunity to speak during the debate on the budget. When we try to speak on the motion for the adjournment at 11 p.m. or 11.30 p.m. we are gagged. I know that Government supporters will say that I invariably speak on behalf of the pensioners, or the unemployed persons on the waterfront and in various industries. Undoubtedly, many people have lost their jobs since this Government has been in office.
I have the honour to represent an electorate in Sydney, which is the second largest city in the British Commonwealth 01 Nations. When I was elected to this Parliament, I determined to serve the people of West Sydney to the best of my ability, whoever they were, regardless of party, class or creed, but never forgetting that I was a member of the Labour party, and never apologizing for it. To-day I have occasion to bring before this House many .urgent cases of distress in my electorate. Because Sydney is the second largest city in the British Commonwealth and therefore the biggest business centre in Australia, any depression or economic disturbance leads to largescale unemployment there.
I take exception, on behalf of the electors whom I represent, to a statement that was made in this chamber recently by the Minister for Social Services (Mr. Townley). I am sorry that I should have to name the honorable gentleman in my complaint because he has tried harder than has any other member of the present Government to help the people who deserve help. However, he has said that many of the people who are drawing social services benefits to-day are nohopers. That statement was practically repeated word for word last night by the Minister for Labour and National Service (Mr. Holt).
– Order ! The honorable member must not deal with debates of the present session. This is an occasion for the discussion of grievances.
– One of my grievances is that there is in my electorate a returned soldier of World War I. who draws 13s. a week war pension and £2 10s. a week social services pension. He has been told that he is fit to work, but he has visited the local Commonwealth Employment Office two or three times a week for the last six months without success. He has tried to obtain u higher rate of war pension, but the three gentlemen who were the final adjudicators on his application told him that he should he a pick-and-shovel worker. He weighs about 7 stone, cannot walk without a stick, and has had 4 inches of bone removed from one of his shins since he returned from World War T. This man cannot obtain employment. I should like to hear what any of the Liberal magnates on the Government side of the House who control big businesses would say to him if he asked them for a job. I know the answer that they would give. My second grievance concerns a man who worked for six and a half years in -an iron foundry and who has lost one hand including his five fingers at the wrist. For six and a half years he did not miss a day’s work at the foundry. He enlisted in the Army in World War II. and was sent to New Guinea, where he stayed for twelve months working as a storeman. He cannot find a job now, although he has visited every foundry in Sydney. Unlike the other man I have mentioned, he is a’ble to work and is willing to do so. Yet we have been told hy two Ministers that many of the people who draw social services benefits are loafers and no-hopers! I wish one of those Ministers would go to Sydney and meet the two men I have mentioned.
My next grievance concerns telephones. Because I represent a large part of the biggest city in Australia, I receive many requests for assistance to obtain telephone installations. But I try to be honest and truthful in my dealings with -electors, and so I tell them that the best way to obtain a telephone is to .go round the back somewhere, not to apply to their member of Parliament, because I can count on the fingers of one hand the number of telephone installations for which I have been responsible. The present electorate of West .Sydney . includes big areas of the former electorates of West Sydney and East Sydney in which many outstanding applications for telephone installations still remain from the days before the redistribution of ‘.electoral boundaries. Haying failed to arrange for the connexion of private telephones, T have tried the ‘next best course of action by applying for the provision of public telephone boxes, but with no better results.
Now I come to the National Health Bill, which, I understand, will be debated by this House later in the current session, and the plight of chronically ill people throughout Australia. The bill does not provide for their needs. If honorable members saw an animal dying by the roadside, would they not try to relieve its suffering .or arrange to have it destroyed and buried decently.? Yet the Government^ proposed health legislation will not help the chronically sick in any way. The Minister for Health (Sir Earle Page) has travelled the world to tell other countries of the merits of his bill, but people who are dying in Sydney will not be eligible for any of the benefits that will be provided under its terms.
– Of course they will be.
– I repeat that chronically ill people will not be eligible for benefits under the bill. I belong to a medical benefit society, and I have questioned the secretary of that organization on this point. He has confirmed my statement, so I am not relying solely on my own judgment. My next grievance concerns the difficulties of pensioners. The Liberals in this House chide me on the ground that I always speak on behalf of the pensioners, but whenever they rise to speak in this chamber we hear of nothing but rams, lambs, wheat and wool.
– Mostly something to eat, at any rate.
– And if we did not have the people of “West Sydney to eat the meat and the wheat, many an honorable member on the Government side of the House would be like a cocky sitting on a post. The situation of pensioners to-day is so deplorable that that great philanthropist, Sir Edward Hallstrom, has donated a new sealed unit Silent Knight refrigerator to their association in Sydney to be raffled on their behalf. Another donation has been made to the organization by Halvic Industries, of Gordon. Where are all the democrats in this House, such as the honorable member for North Sydney (Mr. Jack) and the honorable member for Bennelong (Mr. Cramer), who boast of what they are doing for the poor people? The head of this company has seen the justice of the pensioners’ cause and has decided to help them.
Lord Howe Island, which is included in my electorate, has been left high and dry without a shipping service by this Government. The Government is trying to sell Commonwealth-owned ships. It is offering them for sale for a deposit of 25 per cent., and possibly, if it finds a buyer, it will never call up the balance of the selling price. To-morrow week a ship will s:n from Sydney past Lord Howe Island because it is not profitable to provide a regular freight service to the island. I have written to every Minister who has anything to do with the island, but so far I have not obtained an assurance that it will be provided with an adequate shipping service. An industry has been established there, and regular supplies of food and other essential commodities must be provided.
– Order ! The honorable member’s time has expired.
.- I want to deal with a number of matters that concern my electorate, but first I shall have a word or two to say on subjects that have been mentioned by other honorable members, notably the honorable member for West Sydney (Mr. Minogue). Both he and the honorable member for Macquarie (Mr. Luchetti) complained that there had been no opportunity for honorable members to air their grievances on “ Grievance Days “.
– Hear, hear !
– Well, whose fault is that? Every Wednesday during the current sessional period, until this week, a motion that Government business take precedence over “ Grievance Day “ has been passed by the House. On every such occasion, not one Opposition voice has been raised to object to the motion. It is of no use for honorable members opposite to bay like a lot of dogs now. They had plenty of opportunities to complain that they had something to say on such occasions. Of course, it suited them then to ignore grievances so that they could deal with other matters.
– I rise to a point of order, Mr. Speaker. Is the honorable member for Henty (Mr. Gullett) entitled to refer to votes of this House that have been taken earlier in the current session?
– Other honorable members have referred to the same subject, and I propose to allow the honorable member for Henty the same degree of latitude as I accorded to them.
– If there are to be any hard feelings on this matter, I shall simply let it rest at this point.
The honorable member for West Sydney also complained that there had not been sufficient opportunities for honorable members to discuss important matters during the budget debate. I acknowledge that many grievances should have been aired during the budget debate and the consideration of the Estimates, but they were ignored then. Again I ask: whose fault is that? At no time in the history of federation has the Parliament met more frequently than it has met during the regime of the present Government. There are unlimited opportunities for debate if honorable members opposite have anything important to say. Honorable members will recall that much of the time allotted for the consideration of the Estimates was wasted by certain honorable members opposite in a futile endeavour to dig up some evidence of malpractices in relation to capital issues. No attempt was made to deal with important matters. I say in all sincerity that no other Opposition in this Parliament has failed so signally in its duty to focus attention on important issues and to criticize Government policy and departmental administration in a sensible and practical way during examination of the Estimates. The Opposition’s contribution to the entire budget debate was cursory and casual and, for the most part, was taken up with a fruitless effort to gain party political advantage.
– Order ! The honorable member must not discuss the budget debate.
– The honorable member for West Sydney has been pleased to assume that we on this side of the House associate him with the age pensioners. He flatters himself. All that we do is to regard his continued interruptions of the business of the House, ill-informed and inaccurate as they were earlier today and on Tuesday last, as an attempt to gain some personal advantage for himself by appealing to that unfortunate section of the community, exaggerating its woes, and maligning the Government, which has treated the pensioners better than has any other government in the history of this Parliament. That is the true position. The honorable gentleman referred to some returned soldier who, according to his story, is totally and permanently incapacitated and draws a pen sion of 13s. a week. There is something wrong there somewhere. I suspect that the honorable member’s story is about as accurate as the one he told us a couple of days ago about a person who was going to shoulder the national debt and pay an allowance to age pensioners.
– I rise to order, Mr. Speaker. The honorable member for Henty (Mr. Gullett) referred to something that I said a couple of days ago. I was not in the chamber when he made his remark, but I am informed that he has completely misrepresented my statement.
– Order! The honorable member cannot raise an objection like that now. He is out of order.
– I shall deal now with the matter which primarily brought me to my feet. It concerns compulsory unionism and a person in the electorate that I represent. No doubt this matter will come to the notice of the Minister for Labour and National Service (Mr. Holt), but I mention it now because I know that there are on the Opposition side of this House many influential members of the trade union movement. The practice to which I shall refer could in a sense be more practically dealt with by them than by government action. I hope that, when I have told them the story, they will see what they can do to prevent this sort of thing from happening again.
– I raise a point of order, Mr. Speaker. The honorable member for Henty is referring to compulsory unionism, which is the subject of State legislation at present in preparation. You have ruled that matters of that nature may not be discussed in this House on “ Grievance Day “.
-I cannot recall having given such a ruling, but it would be a good idea for honorable members to confine their remarks to federal matters.
– This matter has nothing to do with the State of New South Wales. It affects a man in my electorate in Victoria. He is an exserviceman of World War I., in which he served with some distinction, having been awarded the Military Medal and mentioned in despatches. He is fully employed in a responsible position by a reputable firm in Melbourne, but, solely as a hobby, he plays with the Returned Servicemen’s League Rand, an organization which raises a great deal of money for charity and other good causes. In no sense can he be regarded as a professional. All these men play for fun and to raise money for worthy causes. Some time ago, an attempt was made to compel this man to join the Musicians Union. He was told by a representative of the union in Victoria that if he did: not join, he could not be permitted to play in the band, and that in some way or other the union would prevent him from practicing his hobby. It can be said with some truth that thi3 is not a federal matter, but it affects the rights of the individual, which closely concerns every democratic government. This is an indication of the sort of thing to which the citizens of this country are being slowly subjected. This man is not dependent on the band for his livelihood. He plays for fun and for the good that the band does to others. But an attempt is being made to compel him to join a union that cannot do him any good. What it boils down to is that if he wishes to practice his hobby, he must contribute to the funds of the Australian Labour party. To that degree, the matter affects this Parliament, because honorable members opposite are here by dint of the support they receive from the trade unions and the contributions to their party that the unions levy on Australian working men and people who indulge on innocent pastimes of this kind. I do not know whether the Minister for Labour and National Service can do anything in this matter, but I know that honorable members opposite are in touch with the trade unions, and I should be very grateful if they would give .it their consideration. I thank them for having made so few interruptions during my speech.
– I direct the attention of the honorable member for Henty (Mr. Gullett) to the fact that the Government is responsible for the allotment of time for the discussion of bills that come before the House. There may be agreement between the. parties, on some occasions, but the Government is solely responsible for providing honorable members with an opportunity to speak on bills and other measures. The most important document presented to the Parliament each year is the budget, but. only half of the number of the members of this House had an opportunity to speak on the budget this year. That was quite wrong. The honorable member for Henty said, under this Government, sessional periods were longer than under any other government, but the records prove that statement to be quite incorrect. Before this sessional period commenced, the House had met for only 22- days this year. That is disgraceful. This series of sittings commenced on the 9th September, and I understand that the Parliament will be prorogued on the 23rd October. On that date we shall have sat for another 24 days. I understand that the next, session will begin on the 10th November, and I assume the House will adjourn on the 11th December. If that be so, we shall have sat for 66 days this year. I think we should be here for more than 66 days in a year. There are 313 working clays in a year.
I know that it would be impossible for the Parliament to meet for six days every week, but I believe we could meet more often than we do.
I resent insinuations made by the press from time to time that members of the Parliament are paid high salaries, for which they do very little. Newspapers should observe a code of ethics. If they believe any member of the Parliament should be criticized, they should confine their criticism to that member and not indulge in a general criticism of all honorable members. Let me inform the House, for the benefit of the newspapers, that I work for seven days a week. Last Christmas day, one of my constituents became ill. He required a drug that, could be obtained only from America. I spent the whole of that Christmas day trying to make arrangements for a supply of the drug to be brought to this country. I complained about the matter to the Minister for Health (Sir Earle Page), and suggested that we should keep supplies of the drug in this country for use in emergencies. That is an indication of the way in which, in many instances, members of the Parliament spend their holidays. I deprecate the fact that the newspapers have been able to cast a slur on all members of this House by pointing out in recant articles that, until the beginning of this sessional period, we had met for only 22 days this year.. The newspapers should give fair reports of the proceedings of the Parliament, but they do not do so. I believe we should meet for more than 66 days in a year, so tha.t when my constituents come to me with their problems I should be able to air their grievances in the Parliament, which, is the proper place to do so. I believe I should have moire opportunity to make representations on behalf of my constituents, not to government departments but to the Ministers concerned. I do not complain about the treatment that I have received from the departments, but some of the matters that I have to raise should be raised with the appropriate Ministers, not with departmental heads.
The Government has failed to do many of the things that it promised to do in 1949. The Prime Minister (Mr. Menzies), in the policy speech that he delivered in that year, said -
Over ft period” of five years we shall raise loans totalling £250.000,000. the interest and sinking fund on which will be provided out of the Petrol Tax. The amount to be raised and spent each year will be conditioned by the availability of men and materials. Its general administration will ho under a National Works Council. The work will’ include feeder roads: soil conservation; the development el rural housing . . . groups of workers’ homes in seasonal labour areas: flood prevention; the provision of water, Tight and power.
Lt is well known that no attempt has been, made to raise even the first £1 of the £250,000,000- referred to by the Prime Minister. I do not know of any feeder roads that have been provided by the Government. By refusing to allocate sufficient funds to the States, the Government has retarded rather than assisted the progress of irrigation schemes, which are essential for the development of the nation and an increase of food production. On most of the water supply and irrigation projects, in New South “Wales work has ceased, although some of the projects are half-finished, or thr.ee- quarters finished. That is due to the failure of this Government to honour its promises. The Prime Minister said the Government would undertake a scheme for the development of rural housing, but we know it has done nothing much in relation to housing anywhere. It has impeded rather than assisted the effort? of the States in the housing field. Although the States have asked for £60’,000,000 for expenditure on housing this year, they are to be given, only £37,000,600. With regard to flood prevention, before the Lyne by-election was held, the Government made a veiled promise to the effect that ifr would make money available for that purpose in the Kempsey district, but when the byelection was over, and the Government’s supporter had been returned on a false promise, that undertaking was forgotten completely. Since the Government has been in power, it has spent about £600,000,000 on defence, but there is not a thing to show for the money.
– Order ! The honorable member’s time has expired.
.- The honorable member for Banks (Mr. Costa) has joined in the chorus of complaint by members of the Opposition that they are not allowed sufficient time in. which to debate the various issues brought before the House. The honorable member referred particularly to the budget debate. Personally, I believe that the Opposition was very grateful to the Government for not allowing, more time for the budget debate. It was obvious to all of us on this side of the House that the charges that honorable members opposite were making against the Government in relation to the budget were groundless. They had no valid arguments to offer. It was rumoured that, after the budget was introduced, the Opposition Whip had a long list of members who desired to. speak on it, but a little later’ twenty of them asked him to withdraw their names from the list because they had nothing to say.
– I rise to order.. I have been misrepresented by the honorable member for Capricornia (Mr. Pearce).
– Order ! The honorable member cannot deal with that, matter now.
– The honorable member for Banks said that the Government was not providing sufficient loan moneys for developmental works. He referred to a promise to raise loans totalling £250,000,000. I point out to him that the Government, since it assumed office, has allocated far more than £250,000,000 to the States for developmental works. The States, particularly New South Wales and Queensland, have not acted in a responsible manner in the handling of that money. Queensland was treated so generously by the Commonwealth last year that it was able to salt away about £9,500,000 which it had been unable to spend. The Premier of Queensland, on his return to this country from a world tour, said, when he stepped from his aircraft at the Eagle Farm airport in Brisbane, that Queensland was the best place in the world and he felt he should go down on his hands and knees and kiss the ground. He has no complaint to make of the way in which the Commonwealth had treated Queensland. He has money to spare for his own pet schemes.
When the honorable member for Banks referred to housing, he was, if I may use a colloquialism, talking through his hat. Everybody knows that the housing position in Australia is very much better than it was when this Government came into office. In 1949, there were houses everywhere that could not be completed owing to a lack of tiles or other materials, but now those houses have been completed. The housing position in Australia now is infinitely better than it was, because of the action that this Government has taken.
– Order ! I cannot allow the honorable member to continue in that strain.
– I now draw attention to the matter of the horror, sub-standard and pornographic type of literature that is flooding the country. I was greatly pleased to hear the Prime Minister (Mr. Menzies) say recently that if the States so requested, he would consider calling a conference of the States to deal with this matter. Although his offer was very reasonable, I am afraid that there is very little likelihood of its being accepted because, if one can judge by their actions, there does not appear to be any unanimity amongst State Premiers about trashy literature. I suggest that the initiative should be taken by the Federal Government.
– It is a matter for the Minister for Trade and Customs (Senator O’sullivan).
– The honorable member for Parkes (Mr. Haylen), as usual, is ill informed about this matter, because the literature does not enter the country through channels controlled by the Minister for Trade and Customs. The honorable member would know, if he had taken any interest in the subject, that all the blocks from which this literature is printed in Australia, and which have an overseas origin, come into the country as firstclass mail matter. I am sure that the honorable member would not advocate that all first-class mail matter should be censored. The Minister for Trade and Customs has been particularly active about this matter, insofar as his authority allows him, and I suggest that he should call a meeting at which the federal Attorney-General and the AttorneyGenerals of all the States should confer with the object of drafting legislation to deal with the publication and the sale of literature of the type that I have mentioned. It is of- no use to leave the matter to the States, because if one State prohibits publication within its own borders there is nothing to prevent comics and other trashy material from another State, that has not the same laws, from being sent to the State that is attempting to suppress their distribution. In the interests of the Australian people, it is vital that there should be a ban on all these trashy productions. Many persons say that the control of such literature is the responsibility of parents. Perhaps it is in some ‘ respects, but while the parents may be able to control the visits of their children to picture shows, they cannot control the type of literature that may be read by other children at the schools. Consequently, although such literature may be carefully kept away from children at home, they can easily obtain it from their friends at school. The only solution appears to be a uniform action throughout Australia to secure the absolute ban of all forms of trashy publications. I am astounded that the States have not already taken action in this direction. I have seen bookstalls flooded with this poor type of literature. In one bookstall in Melbourne I saw some literature displayed in the window; if the front page of one publication had been cut off and pasted on a postcard any one carrying it would have been liable to punishment for being in possession of pornographic matter.
– You suggest that the police should launch prosecutions in such cases ?
– If the police do prosecute they are usually defeated in the courts.
– Well, proper laws should be passed and adequately enforced. For instance, the parking police could look at the windows of shops as they go about their duty of looking at the tyres of motor cars. The remedy seems to be extremely simple, and all that is needed is co-ordinated action throughout the Commonwealth. The Federal Government should perhaps take the initiative in this matter, although it has no responsibility to do so, and call together the Attorney-Generals of each State to consider the laws of the States and bring about uniformity in those laws. Then, almost overnight, we could deal with this matter of trashy literature. Such publications are doing harm beyond estimate to the minds of young people. Also, the sexy romances and comics are having a bad effect on children in the lower teenage groups. We accept it as a principle that films should be censored, and we cut out parts of films that are no worse than many of the comics and books that I am speaking of. If we accept that principle surely we should extend it to publications. I ask this Government to take the initiative in the matter, although it has no responsibility to do so.
I also lodge a complaint about the deterioration of the ethics of the newspapers in general, in regard to their reporting of horror crimes. Perhaps the newspaper proprietors believe that the sale of their papers is their primary object, but I deplore the fact that the family newspaper has disappeared, and that from day to day lurid details of horror crimes are reported in most of our news sheets.
-Order! The honorable member’s time has expired.
– I rise to make a personal explanation. The honorable member for Capricornia (Mr. Pearce) said that twenty honorable members of the Opposition had asked to be relieved of their responsibility to speak on the budget. That is a grave misrepresentation-
– I rise to order. I ask you, Mr. Speaker, how the honorable member can make a personal explanation unless something has been said that affects him personally? Surely the honorable member is not entitled to talk about something that affects his party?
– Order! The Minister’s point is well taken. Matters between the honorable member’, as Whip of his party, and private members of his party are matters about which I cannot hear.
– The honorable member for Capricornia stated that I had said certain things. All that I can say is that 23 honorable members of the Opposition were prevented from speaking because of the application of the gag.
– Order! The honorable member for Watson.
– I do not intend to waste time by talking about the record of this Government, because the electors will have an opportunity of deciding about that matter at the next general elections which will take place within a few months. I am sure that the result of that general election will be a profound shock to honorable members on the Government side. I direct my remarks to the condition of postal buildings and postal employees in the electorate of Watson. I desire to compliment the efficient, conscientious employees of the Postal Department who work in my electorate, especially those who work under the degrading conditions at the Maroubra Junction post office. There are men working in that building who handle £500,000 a year, but they have to work almost shoulder to shoulder. Their conditions should be thoroughly investigated by the Postmaster-General (Mr. Anthony). For four years the Minister has been going to build a modern post office at Maroubra Junction. During all that time I have written letters to him, I .have asked questions of him and I have mentioned the matter in this House. Maroubra Junction is a modern suburb of 24,000 to 30,000 people, but it is served by a post office that was built 30 years ago to serve the needs of about 8,000 people. Surely that fact alone is sufficient to cause this matter to be investigated.
East Botany is a new suburb in my electorate, and it contains many homes built in the last few years for £4,000 or £5,000 each. Yet there is no proper telephone or postal service. There are only two public telephones in the whole of the suburb, one of which is situated at the eastern end, and a mile away, at the western end, the other may be found. There are no public telephones on the south or the north of those two. I believe that the Postmaster-General is waiting until a certain co-operative society builds in the suburb a block of flats which will incorporate a number of shops, and then subject to the whim of this society will he give East Botany a sub-standard post office which will be .situated in one of the shops. In this district at present there are no facilities to buy even a postage stamp, and there are not sufficient public telephones to cater for the people who may have children falling sick in the middle of the night; and I draw honorable members’ attention to the fact that there are about 700 children in that suburb. It is incumbent upon the PostmasterGeneral to supply the necessary postal and telephone facilities for that district without delay. The cost of postal services including air-mail letters, stamps, telegrams, private telephone calls, and so on, have all increased. I have been reliably informed that in the future public telephone charges will be increased to 4d., and I believe that from the 1st January next the people can expect a considerable increase of public telephone charges. I believe that the Minister has decided at this late hour to take advantage of the huge starting-price betting industry throughout Australia and obtain some revenue from it.
Pagewood, which is a thriving .suburb, also in my electorate, ‘suffers from a total lack .of any postal facilities. Indeed, one bright gentleman who opened an unofficial post office in Maroubra called it the Pagewood post office. I have den’t many letters about this matter to the Postmaster-General, but he insists that the facilities for Pagewood are fully catered for by the opening of this particular sub-standard post office in some sort of a mixed-business .shop. The man who uses that .shop no doubt looks after his business rather than the business of the Postal Department, and yet that unofficial post office is supposed to supply all the facilities needed by the suburb of Pagewood. The Postal Department has exhibited a notice at that shop to the effect that it is the Pagewood post office, and yet any letters sent to the occupant of the shop have to be sent through the Maroubra post office. That fact is not sufficiently convincing Ito the bright boys in the Postal Department. Moreover, there are no telephone facilities in Pagewood at all. Many of the residents are air-pilots or policemen, and yet they have to do without telephones. Special treatment, however, has been given to a concern called General Motors-Holden’s Limited, whose establishment contains as many telephones as are needed. Indeed, there is a telephone on almost every officer’s table throughout the works.
At Matraville, Yarra, Maroubra Bay, La Perouse and Malabar, there .is a total lack of telephone and postal facilities. It is pertinent to ask what the PostmasterGeneral is doing with all the money that he collects from the public. There are very few facilities in my electorate, and I know that there are not adequate facilities in many other electorates. Where is the money going? Is it being expended on coronation trips, other visits overseas and tours around the world? Has some of it been expended on the trip overseas recently taken by the Minister ostensibly to investigate television? Honorable .members .should remember that after his investigation and upon bis return, he told us that television was dead. The money that is expended on such trips would be better expended .on providing essential facilities for .the use of the people. The system <of delivery of registered mail from the
Maroubra post office, which serves; the Maroubra area, provides an; example’ of the expense to which people may be put as a result’ of inadequate service: If a postman1 calls at a home in that area with a- registered letter, and the addressee is not at home> he leaves a card informing the addressee that a registered letter awaits him at the Maroubra Junction post office. The addressee may have to go to, the post office by tram or bus at a cost, to him of 6d. each way and if, when he arrives there, the postman concerned is out on. his rounds, he is unable to pick up his registered letter. He may have to make several trips to the post office, spending ls: in ‘fares each time, before he succeeds in obtaining his letter. I mean to cast no reflection on postmen in that criticism. The reflection is properly cast on the methods of management of the Postal Department which is administered by the very inefficient PostmasterGeneral (Mr. Anthony), who. is supposed to be a man of. great business capabilities. People throughout the Commonwealth who suffer under various disabilities that result from the lack of. adequate telephone services are amused by such claims. But people in the PostmasterGeneral’s own electorate are better catered for. There are enough telephone exchanges there, and new post offices are being, built in the electorate. Those works are being carried out to sustain the vote for the Postmaster-General at the next general election, and. ensure that he will at least return to this House as a member, even if his party is not returned to office. Nevertheless, I say-
-Order ! The honorable gentleman’s time has expired.
.- It may be some consolation to the honorable member for Watson (Mr. Curtin) to hear that I, in common with him, have difficulties that are associated with the provision of telephones. I shall direct my remarks to the lack of telephone facilities in the division of Mitchell. I realize that the Postmaster-General (Mr. Anthony) faces extreme difficulties in overtaking the backlag left to him by the previous Administration. The lack of adequate telephone, facilities is a serious problem in my electorate because the population of the electorate’ is growing. The problem* is-‘ accentuated in parts of the’ electorate that are adjacent’ to the’ borders of Sydney. A short time* ago, they were considered to be- rural areas, but they are now rapidly becoming outer suburbs of Sydney: Businessmen are attempting to establish shops and other services in such areas to meet the needs of the growing population, but suffer under a tremendous handicap because of lack of telephone facilities. Every week instances are brought to my notice, of tradesmen,, such as. butchers, general storekeepers, milk vendors, bakers and others, struggling to- cope with the appalling situation caused by lack of telephones. They are attempting to give the people services, and to develop goodwill, but are forced to carry on their businesses without telephones. Because of the lack of transport in these areas housewives would prefer to ring through, their orders for domestic supplies, but they have, to walk long distances to the nearest store. It is pathetic to see businessmen having to spend their time in public telephone booths, or wasting their time outside. That waste must add to their overhead.
I have been informed by the PostmasterGeneral that the installation of private telephones in some parts of my electorate is out of the question. I ask the Postmaster-General to meet that situation’ by installing public telephones. This is only a temporary expedient and I know what torture it is to wait outside a public telephone booth, because I lacked a private telephone for two years after the war. You have to stand outside the booth perhaps for half an hour with the pennies in your ‘ hot hand waiting your turn. When I was without a private telephone I had to go to a. public telephone every night, usually to find’ some young’ man carrying on his courtship over the telephone, and making a good job of it by spending 20 or 30 minutes on one call. When you finally get into the booth you find that it is more like a sweat box than a public telephone booth. In country areas people cannot jump into a tram or bus and go searching for another telephone booth that may be vacant. They just have to wait their turn and be thankful’ that there is a telephone there at all. Despite the fact that the Postal Department is courteous enough to admit the need for public telephones there is a long delay between the time when such an installation is approved and the time that it is provided. I receive letters from the department, which I know almost by heart, about the provision of telephone facilities. One of them reads -
Careful consideration has been given to your personal representations respecting a petition submitted by Mr. E. H. Childs, Lot 17, Seven Hills Road, Seven Hills, relative to the delay in providing a public telephone near the intersection of Seven Hills Road and Cornelia Road, Seven Hills.
Whilst the necessary line plant has been reserved for the installation, unfortunately curtain public telephone equipment is not available to permit of the service being provided. Orders for the manufacture of the equipment have been placed, but considerable difficulty is being experienced in obtaining deliveries. In the circumstances, some further delay in establishing the desired facility is unavoidable.
I appreciate the difficulties of the Postal Department regarding equipment. I understand that the position in that respect is better in Queensland than it is in New South Wales, and I hope that that favorable circumstance will soon extend southwards. Every day I receive letters from constituents asking for telephone connexions and in many instances the livelihood of a constituent depends ou the installation being effected. Some people have told me that they have already waited seven years, and one classic example of delay is provided by a constitutent who waited eleven years for a telephone. A service was installed in his home only recently. The installation of a telephone is taken as a matter of course by people in the cities, but it was an occasion for celebration for this man. . Although the department is at all times courteous, and gives me as much assistance as it can when I make representations to it, it is impossible for it to correct in a short time a situation that has developed over a period of years. While the present shortage of telephone services exists I hope that the PostmasterGeneral’s Department will not be distracted by innovations such as television, from its really important work. So far as my electorate is concerned, telephones come before television. Departmental officers, both in Sydney and Parramatta, and members of the department’s indoor and outdoor staffs have given me all the help they could, but I now ask the PostmasterGeneral to give serious consideration to the overall position, with a view to doing something quickly for my electors.
– In this House, on the 29th September last, I asked the Prime Minister (Mr. Menzies) the following question : -
I ask the Prime Minister whether the Australian National University has let one of its furnished houses in Canberra to the Minister foi- Territories? Will the right honorable gentleman say whether it is customary for the University to let ils cottages to persons other than members of its staff? Does the Prime Minister know of this arrangement and, if so, will he state what is the appropriate rent for this house furnished, what would be the appropriate rent for it unfurnished, and what rent the Minister for Territories is paying?
That was a specific question, and I think that it is proper that it should have been asked in this House and that the House should receive an answer to it. The answer supplied to -me by the Prime Minister, in writing, begins as follows: -
So far as Mr. Hasluck’s -position as a tenant is concerned, that is his personal affair, and is none of the business of the House.
It concludes by quoting information given by the university, in the following terms : - ‘
The house which is temporarily occupied by Mr. Hasluck is one of a small group which the university decided to furnish and reserve, so far as may be possible, for senior scholars from overseas, accompanied by their families, who come to the university for one year.
There will, of course, be some gaps between the departure and arrival of visitors in this category and it is to fill one such gap, without loss of revenue to the university, that Mr. Hasluck has been granted temporary occupancy.
Mr. -Hasluck is paying the same rent as other temporary tenants of the university.
I consider that answer to be completely inadequate. However, it reveals the existence of a financial arrangement between the Minister and the university. When there is a financial arrangement between a Minister of the Crown and a Commonwealth agency or instrumentality, which is financed solely from funds voted by this Parliament, then I suggest that members of the Parliament should be made aware of the arrangement. There may be nothing improper in the arrangement to which I have referred, but the possibility of impropriety exists in any such arrangement. Indeed, the only suggestion that there may be impropriety arises from the fact that the Prime Minister has declined to furnish the details of the arrangement to this House. I repeat, that if the Minister is gaining a benefit from the tenancy of the house, he is gaining that benefit from funds provided for the university from tax revenue. In my view that is wrong. I suggest that the Minister should not be in a position to accept a favour from an agency or instrumentality of the Commonwealth. He should enter into no arrangement of a kind that is not open to all members of the community. Even now I ask the Government to clarify this position, and to supply the information to which this House is entitled. I ask the Minister for Supply (Mr. Beale), who is in charge of the House at the moment, to inform me what rent is paid by the Minister for Territories.
– I have asked the Minister for Territories (Mr. Hasluck) to come into the chamber if he can, but I understand that he is engaged on a Cabinet subcommittee.
– I regret that he is not here. I ask the Minister for Supply what rent the Minister is paying to the university, and whether that rent is the properly calculated economic rent of the dwelling.
– I think the honorable member may take that for granted.
– I am taking nothing for granted in this matter. Specific questions have been asked, and specific answers should be given. This House should not be treated with the scant courtesy displayed by the Prime Minister in the answer he gave to perfectly legitimate questions. I repeat the questions. What rent is paid by the Minister to the university? Is the rent he is paying the properly calculated economic rent of the dwelling? Does the rental charged to the Minister by the university cover the provision and use of furniture and furnishings? The answers to these questions should he given to the
Parliament. The questions which I addressed to the Prime Minister contained no criticism of the Minister for Territories. They dealt with matters of great concern to the Parliament, and therefore it is proper that the Parliament should be given the answers to them.
– At the outset I should like to make it clear that I regard my living arrangements as my own personal business. Whether I choose to occupy a hotel bedroom or a house, or even a tent, is my own affair, and not that of the Parliament. Having made my position abundantly clear, I admit, as did the Prime Minister (Mr. Menzies), that what the Australian National University does may be the concern of this Parliament inasmuch as the Parliament votes money for the purposes of that institution. The Australian National University comes, not under my administration, but under that of the Prime Minister. The Prime Minister has said quite clearly that the university owns certain houses which it sets aside for visiting scholars who arrive here at the beginning and leave at the end of the academic year in accordance with the terms of their scholarships. It happens, more or less by accident, that one of these houses has become vacant for a short time until the next batch of visiting scholars arrives here. Taking advantage of that fact, the university authorities granted me a temporary tenancy of the house for three months. If such an arrangement had not been made, the house would, I assume, have remained vacant. It happens that members of the Parliament, who form a part of the transient population of Canberra, are among the few persons who could take advantage of a temporary arrangement of that sort. I was grateful, personally, to the university authorities for having given me that brief opportunity to get away from the horrors of living, week in and week out, in a hotel bedroom. The Prime Minister also said that the -rent charged to me was the rent that would be charged to any other occupant of the house. I assume that, in fixing the rent, which covers a charge for the premises and the furnishings in them, the university authorities made a business- calculation. I do not want to ada” my financial affairs in this House, but I can -say .that the rent is pretty solid.
– The Minister should tell the House what rent he pays.
– That is my own business, but I do not mind telling the honorable member that I am paying £8 a week.
– That is a very high rent.
– Other charges, such as for telephone, light, cleaning and the like have to be met .by me. It is not a low rent. I should imagine that it was calculated with good financial judgment having regard to the capital cost of the house, the value of the furnishings and the general expenses incurred by the university authorities in connexion with the property. I remind the House that honorable members on both sides are represented on the council of the university. If the honorable member for the Australian Capital .Territory was concerned about the way in which the university is being run, or if he was suspicious that some action against the public interest or the financial interest of the university itself had been taken, he had an opportunity to ask the honorable member on his own side of the House who is a member of the council to obtain the desired information. I cannot understand why he should have chosen to make so much of a public issue .of a matter which concerns the domestic management of the. university when two members of his own party in this Parliament take a part in that management. I admit that, inasmuch as the Parliament provides public money for the Australian National University, it is proper for honorable members to ask questions about its -affairs. The Prime Minister . gave completely satisfactory and open answers to the questions asked by the honorable member on this subject. The suggestion that there has been some sort of discrimination in my favour is completely wrong. No such discrimination has been exercised. I have been treated in exactly the same way as /any’ other .occupant of the house would have been treated. The house could not have been made available to another tenant except, for a brief period until’ the person or persons for - whom it was designed arrived in Canberra to occupy it.
– A.previous “Western Australian Minister had a house in the Australian Capital Territory. It is essential for an honorable member from Western Australia who desires to enjoy any sort of family life to have a house in this city.
– I thank the honorable member for Fremantle (Mr. Beazley) for that comment. The honorable member knows, perhaps better than do people who live in Canberra, the peculiar disabilities suffered by members of Parliament who represent electorates in distant States. It has been customary for Ministers who come from Western Australia and who are obliged by the necessities of office to live here for many months on end, to seek accommodation other than that provided in a hotel. I am completely at a loss to understand why the honorable member for the Australian Capital Territory should have made such an issue of this matter.
– The Minister has been placed in a special category which puts ham on a footing different from that of any other member of this community
– The honorable member has tried to place me in a special category different from that of other persons who live in the Australian Capital Territory. He argues that every one who lives in Canberra, year in and year out, is entitled to a house unless he is a member of Parliament. He says that a person like myself who comes from a distant State and is here for most of the year is not entitled to a house. That is the only discrimination I can see. I cannot follow the honorable member’s argument that I have been placed in a privileged position or in a category different from that of other persons in this community.
– Where does the honorable member for the Australian Capital Territory live?
– He lives in a government boarding house, and as far as I know, no honorable member has questioned1 his right to do >so. -He has thus become a tenant of the Commonwealth.
No honorable member has asked him impertinent questions about how much he pays for his board and lodging or how lie conducts his personal life. In raising this matter the honorable member has done something which, on reflection, he will realize does not involve matters of public interest, and in so doing he has failed to display the customary courtesy which he extends to his fellow members.
– I call the honorable member for Shortland.
Mi-. If a lees. - I rise to order. I submit, Mr. Speaker, that the Minister’s reply was in the nature of a personal explanation, since he was not replying as Minister in charge of the department concerned, and that, accordingly, the call should be given to a member on this side of the House.
– Order ! The Minister had a right to receive the call from the Chair. In accordance with my usual custom I gave the next call to an honorable member on the left of the Chair.
– I wish to bring before the House a matter which concerns the complete disappearance, almost two years ago, of a member of the Australian Regular Army who had “been stationed at the long-range weapons testing range at Woomera, and the harsh treatment that has been meted out to his wife by the Army authorities. The fact that a man was able to leave Woomera apparently without hindrance and to remain absent for about twenty months is a grave reflection on the efficiency of the security service. On the Sth January, 1952, Mrs. Lola Fuller, who then resided at Grafton, -was informed that her husband, Kendal George Fuller, of the 2nd Company, has been posted as absent -without leave. Her allotment was cancelled as from the 21st -January of that year. Prior to that I understand that the soldier had been reported absent without leave for nine days from the 25th December, 1951. -Since then I have made representations to the Army -authorities on behalf of Mrs. Fuller in an endeavour to ha ve her allotment restored. For more than twelve months Mrs. Fuller and her baby child have been compelled to -live on the dole. On the 14th January last I wrote to .the Minister for the Army (.Mr. Francis) and informed him that Mrs. Fuller was at a loss to understand why her husband .should be absent without leave and that she feared that he had met with foul play. On the 22nd January the Minister acknowledged the receipt of my letter and informed me that inquiries were .being instituted. On the 10th April, 1953, I again wrote to the Minister -and directed attention to the fact that I had received no information from him in regard to my representations. On the 18th May, the Minister sent me a letter, a portion of which reads as follows : - “l t is advised that Corporal Fuller “was posted as being absent without leave from his unit, Long Range Weapons Establishment Range, Woomera, on 21st January, 1952. As regulations provide that all pay and allowances are forfeited during absence from duty without leave, his allotment was suspended as from that date and, as he lias not since returned to duty or been apprehended, it has not been reinstated. Corporal Fuller had previously been absent without leave from 25th December, 1051, until 2nd January, 1952, during which period the allotment was not paid.
The important aspect of this case is that whilst the most efficient security arrangements are supposed to have been made at Woomera, a soldier who had been stationed there can disappear without trace. Last year, when it was discovered that a number of people at Woomera had voted for the Communist candidate in the State elections, security measures were tightened up at the testing range. This case proves that it is possible for a person to leave Woomera without the knowledge of the’ security officers. The soldier could not have walked out of Woomera without having been questioned. Everybody who has been to Woomera knows that persons who enter or leave ‘the long-Tange weapons testing range are carefully watched. Indeed, before a person is allowed to enter or leave the range aTea he must fill in the prescribed security forms. Notwithstanding all these precautions this soldier apparently left Woomera and his whereabouts are unknown. His wife has had to leave her baby -child with its grandparents and take a job. She wrote a letter to the Army authorities, which she posted by registered mail, but received no reply. She fears that her husband may have come to harm. It is possible that a person could be killed at Woomera and taken a mile or so away from the establishment without any one knowing what had happened to him. No facts have been brought to light to indicate in what way the man left his place of duty. The Parliament and the wife of the man concerned should be told whether he took his clothing with him and whether he left Woomera by road or by air. Mrs. Puller’s claim for the restoration of her allotment should be granted pending the fullest investigation and the establishment of the facts which would determine whether or not the soldier is actually absent without leave. The Army authorities and the officers of the security service have an equal responsibility in this matter.
Debate interrupted under Standing Order 291.
Question resolved in the negative.
Sitting suspended from to 2.15 p.m.
– I move -
That the hill be now read a second time.
The Commonwealth Observatory Trust Fund Act 1930-1944 establishes the Commonwealth Observatory Foundation and Endowment Fund vested in the Commonwealth Astronomer, the Secretary to the Treasury, the Secretary to the Department of the Interior, and such other person as the Minister appoints, as trustees. At the end of each quarter, the trustees are required to deposit to the Commonwealth Astronomer’s Account in the Commonwealth Savings Bank the income from investments constituting the fund. The Commonwealth Astronomer is authorized to spend money in the astronomer’s account for the purposes of the observatory. It has been found, in practice, that the rigid definition of trustees and the financial provisions of the act make working difficult. The fund is comparatively small, and amounts at the present time to approximately £3,000.
In August, 1952, I discussed with the Auditor-General a fact that four highly paid officers had to sign documents in connexion with the Commonwealth Observatory Foundation and Endowment Fund, and, incidentally, the Forestry Fund, and I suggested that the method of accounting might be simplified, because each of the funds had to be separately audited, and reported on. This bill, and the Forestry and Timber Bureau Bill 1953, which will be considered later, are really the outcome of that discussion. Instead of having a fund outside the normal accounting transactions of the department, it is considered preferable that the fund should form part of the main Trust Fund of .the Treasury, to which the provisions of the Audit Act apply. There would be no need for the appointment of trustees. All moneys donated for the purposes of the observatory would be kept in a distinct account in the main Treasury Trust Fund, and would be available for the purposes of the observatory. A separate Commonwealth Astronomer’s Account would not be necessary.
As the amendments required to give effect to these proposals would have involved substantial changes to practically all existing sections of the Commonwealth Observatory Trust Fund Act 1930-19-44, the bill, as drafted, repeals the act, and replaces it with a shorter measure which covers all the requirements.
– This bill originated in the .Senate, and I believe that this House can dispose of it without any delay. However, I desire to direct attention to one important feature of the bill. It relates primarily to the Commonwealth Observatory Trust Fund, which waa established by the Scullin Government in 1930. At that time, the then Prime Minister, the late Mr. Scullin, expressed the hope that the fund would be materially increased by further donations from public-spirited citizens of Australia. The actual amount in the fund at the present time is approximately £3,000. The object of the Minister is to provide a simple and convenient method whereby accounts may be dealt with, cheques signed, and so forth without the necessity to obtain four signatures. The Opposition agrees with that proposal. However, the Opposition desires to make the position crystal clear that the wide terms of this legislation will not prevent the carrying out of any trust, condition or purpose expressed by the donor of a gift for observatory purposes. Clause 5 (3.) of the bill reads as follows : -
Moneys standing to the credit of the Fund may be applied, in a manner approved by the Minister, for the purposes of the Observatory.
It is quite possible that donations have been, or will be, given for an express purpose, say, connected with the great telescope of Mount Stromlo, rather than the general purposes of the observatory. Clause 5, as drafted, would appear to sanction some departure or apparent departure from the trust or condition. However, the debate that took place on this aspect in the Senate, and the speech of the Minister for the Interior (Mr. Kent Hughes), make it clear that such 13 not the intention of the Government. Therefore, it is to be clearly understood that the Parliament, in assenting to this bill, is re-affirming the necessity for the Government to carry out the donor’s purposes if a gift is made by a private person for a trust or condition. As a matter of fact, I do not think that this Parliament lias power to depart from such a trust or condition. If money is given to the Commonwealth for valuable and beneficent purposes, the general law will apply and the Commonwealth, like every other authority, will be bound to conform to the conditions of the trust. In my opinion, this Parliament has no power, under its limited functions, as set out in the Constitution, to depart from those purposes. I do not suggest for a moment that the Minister or the Government has the slightest intention of departing from those purposes, but some anxiety has been aroused by the terms of the bill, and the Opposition in the Senate and in this House has given careful attention to that matter. We regard this bill as a mere machinery measure to facilitate the handling of accounts, but we understand that the purposes of a trust, if trust there be, will be carried out, because a donor may be interested in a special feature of observatory work. The Commonwealth Observatory at Mount Stromlo is destined to become one of the great observatories in the southern hemisphere, and I believe that even the minor amount of attention which we can give to the bill now will emphasize to honorable members and the public the importance of the purposes of the scientific work of this observatory. On the clear understanding about the trust, to which I have referred, the Opposition will allow the bill to pass without delay.
Question resolved in the affirmative.
Bill read a second time, and reported from committee without amendment or debate; report adopted.
Bill - by leave - read a third time.
– I move-
That the bill be now read a second time.
This bill also deals with a trust fund. Sections 5 to 12 inclusive of the Forestry and Timber Bureau Act 1930-46 establish the Forestry Fund vested in the Director-General of the Forestry and Timber Bureau, the Secretary to the Treasury, and the Secretary to the Department of the Interior, as trustees. The fund consists of donations and any other money or property received by the trustees for the furtherance of forestry. Moneys in the fund may be applied for a furtherance of forestry in such manner as the Minister, on the recommendation of the Director-General, approves. Provision is made for the audit of the accounts of the trustees by the Auditor-General. This bill, like the Commonwealth Observatory Trust Fund Bill 1953, which has just been passed, is the result of discussions with the AuditorGeneral in August, 1952.
It has been found in practice that the provisions of the act to which I have referred, and the rigid definition of trustees, make for unwieldy working conditions. The Forestry Fund is only small. The present balance is less than £200. All documents in relation to the fund require the signatures of three highly paid officers, and payments from the fund, irrespective! ‘ of the smallness of the amount involved, necessitate the approval of the Minister on the> recommenda-tion of the Director-General.. The intention of the bill is that the Forestry Fund should become a trust account within the main trust fund of the Treasury. Operations on the fund would then follow normal Treasury accounting procedure. The provisions of the Audit Act would apply. The appointment of trustees would not be necessary.
Clause 3 of the bill proposes the abolition of the definitions of “ the fund “ and “ the trustees “ in the existing act. Clause 4 amends the reference to the title of the Public Service Act. Clause 5 repeals sections 5 to 12, inclusive, of the principal act, and inserts new sections 5 and 6 which relate to the establishment of the Forestry Trust Fund and the receipt of donations and expenditure from- the fund. Clause 6. covers the transfer of the moneys in the existing fund to the trust account created by this amending legislation.
An inquiry was made, when this bill was being considered by the Senate, about the donation of £5,000 by Mr. Russell Grimwade, in 1929 for the foundation of a prize for the encouragement of scientific forestry in Australia. Some honorable senators pointed out that, the amount, in the fund was only approximately £200, and asked for information about the disposal of the principal of £5,000. I desire to inform the House that the money, by arrangement with the donor, is held by the Trustees Executors and Agency Company Limited. This company makes the interest available as a prize which entitles the winner to a post-graduate: course at the Imperial Forestry Institute, Oxford, and to such forestry tours on the Continent of Europe and elsewhere as may be arranged. That is to say, the prize is a travelling scholarship. Four scholarships were granted in the years before the outbreak of World War II., and one scholarship was awarded in 1950. The fund is still intact, and an appreciable amount of interest has accrued. Those matters are related to the bill only indirectly, and I mention them now because of the questions that were asked in the Senate about the fund. I thought that, honorable members would be interested to know how the donation was being used.
, - Similar matters arise in connexion with this bill as those which arose in respect of the Commonwealth Observatory Trust Fund Bill 1953. The purpose of the bill now before the House, whatever may be said about the precise wording of it, is to facilitate the handling of the moneys which have been given from time to time by private donors for forestry purposes.. The effect, of the bill will be to enable these moneys to be handled more conveniently. This, of course, has our approval. Gifts have been made by private individuals from time to time to foster Commonwealth forestry activities. One of these was the magnificent donation of £5,000 by Mr. Russell Grimwade for the establishment of a travelling scholarship. This money, as the Minister has pointed out, is not, in fact, handled by Commonwealth agencies but is controlled by a trustee, who, no doubt, was appointed by Mr. Grimwade. When the Forestry and Timber Bureau Bill was introduced’ in this Parliament, the Minister for the Interior at that time, Mr. Blakeley, pointed out that many patriotic citizens had indicated a practical interest inforestry by making gifts for the use of the Australian Forestry School, which is one of the important centres of forestry scholarship in the southern hemisphere. It attracts students from all parts of Australia, New Zealand and elsewhere.
The point that I wish to emphasize is reinforced by the comment of the AuditorGeneral to which the Minister has referred. The Auditor-General pointed out, in correspondence with the Minister, that the Audit Act is under revision with the object of including in it a provision that moneys donated to the Commonwealth by any person shall be credited to- a head of the general Treasury trust fund. But, even without such an amendment, my view is that, if a person makes a gift to the Commonwealth on trust, no legislation enacted by this Parliament can derogate from or interfere with the purpose of that trust. The Parliament would not have power to- legislate in that way, and, of course, it would not wish to do so. f am glad that this bill and the similar measure which deals with the Commonwealth Observatory Trust Fund have been presented to the Parliament because it is important that the stream of private donations for public purposes should continue to flow. Everything should be done to encourage citizens to contribute to such splendid institutions as the Australian Forestry School and the Commonwealth Observatory.
Question resolved in the affirmative.
Bill read a second time and reported from committee without amendment or debate; report adopted.
– by leave - I move -
That the bill be now read a third time.
I thank the Leader of the Opposition (Dr. Evatt) for having granted to the Government the facility of a rapid passage for this bill and the Commonwealth Observatory Trust Fund Bill, which are merely machinery measures. I assure him that amendments to the Audit Act, to which he referred in his second-reading speech, are under consideration, together with several other proposals that have been made by the Auditor-General. It was not possible to have the larger amending bill drafted in time for presentation at that stage. Therefore, as it was desired to improve the machinery of the two principal acts to which this bill and the previous bill relate, those measures have been introduced in advance of other measures that are in contemplation.
Question resolved in the affirmative.
Bill read a third time.
– I move-
That the bill be now read a second time.
The Service and Execution of Process Act, one of the measures enacted by the first Commonwealth Parliament, was passed for the purpose of facilitating the service and execution of civil and criminal, process and the judgments of the courts of the States and territories inother States and territories. The act has been amended from time to time to meet the changing needs of State and territory law and court process. This bill introduces further amendments to bring the act into conformity with present-day requirements. The amendments will effect a reduction of the times for entering an appearance to a writ of summons, extend the provisions of the act to additional court process, and apply the act directly to certain external territories. In addition, that portion of the act which deals with the execution of warrants and writs of attachment has been re-made with a view to making the intention of the legislature clearer.
The periods of time for entering an appearance to a writ of summons prescribed by section 8 of the existing act were laid down in 1901 before the introduction of modern rail and air services. Clause 5 of the bill will repeal section 8 and insert a new section which will reduce the time limits generally, and at the same time remove present anomalies by fixing a uniform period of twenty clays for appearance to a writ of summons where the writ is issued and served within the mainland, and a uniform period of 45 days where the writ is issued or served outside the mainland. These times are, of course, minimum times for appearance and may be enlarged by rules of the court out of which the writ of summons is issued.
Clause 6 and the proposed new section 19 c, which will be inserted by clause 7, will effect an extension of the facilities of the act to additional court process. Clause 6 will repeal section 15 and insert a more generalized section in its stead. In its present form, section 15 refers only to specific classes of criminal and quasicriminal process, and any process not specifically included in section 15 and not falling within the provisions of either section 4 or section 14 of the act cannot be served under the act. For example, a husband living in State A, whose wife obtains a maintenance order against him in that State, and then goes to State B, cannot effectively serve on his wife a summons for variation of the order. This is an unjust anomaly which requires correction. The list of types of process which might be served under section 15 has increased with progressive amendments of the section, and, instead of adding specific classes of process to an already somewhat lengthy list, the new section 15 is in general terms and will operate upon any criminal or quasicriminal process, provided the process has issued on information or complaint made on oath. The proposed new section 19c will enable a writ of attachment issued by a court of record of a territory or a judge of the court for a contempt of the court or disobedience of an order made by it to be served in any State or other territory. “Writs of attachment issued out of courts of a territory cannot, under the act as it now stands, be executed outside the territory of issue.
The existing act applies to the service and execution of process of the courts of the States and of the two mainland territories, that is, the Australian Capital Territory and the Northern Territory. The provisions of the act, suitably modified, have, however, for some time been extended by regulations made under the act to certain of the external territories - the Territory of Papua and New Guinea and to Norfolk Island. These territories now enjoy properly established judicial systems, and the bill accordingly extends the act directly to them. Provision is also made in the bill to extend the provisions of the act by regulations to other external territories as and when it may be necessary to do so.
The opportunity has been taken in this bill to clarify the intention of the legislature in certain of the provisions contained in Part III. of the act. It has been found desirable to remake the whole of this part, but the redrafted part, except in a few minor respects, contains no substantive alteration. One slight alteration of substance affects section IS of the act. . This section deals with the backing of warrants for execution outside the State or territory in which the warrant is issued. In its present form, the circumstances in which a warrant may be issued and executed outside the State or territory of issue are specifically enumerated. No warrant issued in cases where the circumstances are not specified may be executed under the act. It was considered desirable that this section should be recast in more general terms to enable any warrant to be executed in another State or territory. The other substantive alteration is contained in the proposed new section 19. This section enables a person apprehended under section 18, or the person seeking the execution of the warrant, to appeal to a judge of the Supreme Court of the State or territory in which an order under section 18 was made for a review of that order. This section is designed to provide an additional safeguard against any person being improperly removed from one State or territory of the Commonwealth to another under a warrant. A similar provision has for some time been in operation under the act in its application to the external territories. There is nothing controversial in this measure, and, in my opinion, not only does it contain some necessary improvements to the existing law, but also it will re-enact some of the substance of the present act in a much more desirable form. I commend the bill to honorable members.
Debate (on motion by Dr. Evatt) adjourned.
Debate resumed from the 10th September (vide page 113), on motion by Sir Arthur Fadden -
That the bill be now read a second time.
.- Briefly, this bill will authorize the payment to the States of special financial assistance in addition to the amounts that are payable under the terms of the formula provided in the States Grant.” (Tax Reimbursement) Act 1946. According to the formula, the total amount that is due to the States for 1953-54 is £120,549,000. At the conference of Commonwealth and State Ministers last month, the Commonwealth offered £142,000,000 to the States and indicated at the same time that this offer took into consideration the fact that the Commonwealth did not propose to make separate grants to reimburse the States for the cost of administering prices and rent controls. The £142,000,000 is made up of a sum of £122,000,000 calculated under the formula contained in the States Grants (Tax Reimbursement) Act 1946, and a sum of £21,451,000, which is an additional grant to the States. It was finally agreed that the additional grant of £21,451,000 should be distributed on the basis of the grants made under the formula, with the exception that Victoria should receive an additional £419,000 and Tasmania an additional £40,000. The effect of the arrangements made at the conference, and now embodied in this measure, is to grant to the States approximately £6,500,000 more than was granted to them in 1952-53.
The bill is one of the many measures introduced into the Parliament since federation to give the States financial assistance to overcome their financial difficulties. It is safe to say that, as a result of the introduction of uniform taxation, many similar bills will come before the Parliament in the future. The question of the financial relations of the States and the Commonwealth is full of difficulty. On more than one occasion since federation, the Commonwealth has had to consider very seriously the financial position of the States and take action to protect their interests. Even when the Constitution was being drafted, it was evident that, as soon as the federation was formed, the States would encounter some difficulties in respect of finance, because the Commonwealth would take the whole of the customs duties formerly collected by the States, which comprised a very important part of their revenue. To overcome that difficulty and to allay the fears of the States, it was provided in the Constitution that, for the first ten years of federation, 75 per cent, of the revenue from customs duties should be made available to the States. That arrangement operated until 1911 when, after a. conference between the Commonwealth and the States, a system of per capita grants was introduced. From 1911 until 1927, grants were made to the States by the Commonwealth on the basis of 25s. a head of the population of each State. In 1927, the financial agreement on Commonwealth and State financial relations came into operation, and the per capita system disappeared. The Commonwealth undertook to accept certain responsibilities in respect of the financial commitments of the States. Legislation was passed which provided that, for 58 years from 1927, the Commonwealth should make payments to the States in respect of interest charges to the extent of £7,500,000 a year. Those payments are being made to-day, and will continue to be made. In addition, the Commonwealth agreed to pay a proportion of the sinking fund charges on State debts contracted after 1927, but that undertaking did not extend to any debt incurred by a State as a consequence of a revenue deficit.
The necessity to give special assistance to the States in respect of certain of their commitments was recognized prior to 1927. In 1923, the Commonwealth commenced to make payments to the States in respect of roads. In 1926, the Federal Aid Roads Agreement was negotiated, which provided that a proportion of the revenue from the petrol tax collected by the Commonwealth should be made available to the States for road purposes. The legislation which gave effect to that agreement has been amended from time to time. The present position is that the Commonwealth pays to the States for road purposes 6d. a gallon of the customs duty imposed on imported petrol and 3-Jd. a gallon of the excise duty on petrol manufactured in Australia. Let me say here that the prevailing impression that the petrol tax was introduced by the Commonwealth for the express purpose of raising funds for payment to the States for road purposes is incorrect. The first legislation by the Commonwealth Parliament in respect of the taxation of petrol was passed in 1902. Obviously, the tax was designed to raise revenue for the Commonwealth itself. From 1927 until 1942, no fixed sums were paid to the States by the Commonwealth, except those to which I have already referred. During the years of the depression, certain emergency payments were made to assist the States during that very difficult period. Grants were made in respect of certain public works, and. the States were assisted in respect of farmers’ debts adjustments.
-Order ! The honorable gentleman is going very wide of the hill, which is confined to one financial year.
– 1 am relating the history of Commonwealth and State financial relations, because I desire to refer at a later stage of my speech to difficulties with which the Commonwealth is confronted as a result of legislation of this type. Unless I refer to past actions, it may be difficult to link my later remarks with the bill.
– I shall allow the honorable gentleman to proceed, but I warn the House that I shall not permit anybody else to traverse the same ground. Otherwise, we shall be here until the year after next.
– I think we all hope to be here the year after next. I turn now to the adoption of the present system under which grants are made to the States. At the outbreak of World War II., great difficulties were experienced because income tax was being levied by both the States and the Commonwealth. In New South Wales and Queensland, taxes were very heavy. Efforts were made by the Commonwealth to persuade the States to agree to a system of uniform taxation, under which only one taxing authority would operate. The object was to avoid a great deal of confusion and the necessity for some States to impose higher taxes than others.
– I rise to order. The ruling that you have just given, Mr. Speaker, raises a series of questions in my mind. The honorable member for Bendigo (Mr. Clarey) has just referred to uniform taxation, which is an extremely controversial subject. If you do not intend to permit honorable members on this side of the chamber to discuss controversial matters of the nature raised by the honorable member, I suggest that you ask him to confine his remarks to the bill.
– I have had a good look at the bill. I find that only two States are affected by it. It provides that Victoria, in addition to a payment under the terms of clause 4 (;1), shall receive the amount by which that payment is less than £35,000,000, and that Tasmania shall receive £40,000: Even stretching the Standing Orders to the fullest extent, a speech on this measure should not last for more than five minutes. That is my view. The honorable member for Bendigo is going completely outside the scope of the bill. I cannot allow him to proceed on those lines.
– I rise to order. The Treasurer (Sir Arthur Fadden), in his second-reading speech on’ the measure, was granted leave to incorporate a table in Hansard. The table shows how the special grant of about £21,000,000 is to be distributed among six States. I submit that the bill covers all States.
– According to clause 4, it covers only Victoria and Tasmania.
– May I point out that clause 3 of the bill-
– I see that clause 3 covers the six States. I was wrong.
– It is not my intention to go into matters that may give rise to controversy.
– Order ! I am not concerned about controversy. I do not care how much controversy there is, so long as it is within the scope of the bill. My ruling is that the honorable gentleman’s remarks are not within the scope of the bill.
– The formula under which these payments are made is contained in the States Grants (Tax Reimbursement) Act 1946. That act provides that variations of the basic payment of £40,000,000, which was later increased to £45,000,000, shall be made in such a manner as to take account of variations of State populations since the 1st July, 1947, and the percentage increase, if any, in the level of average wages per person employed over the level in 1945-46. The question arises whether this payment, which the Treasurer stated was agreed to by. the States, is satisfactory in view of the financial commitments of the States and whether it will enable them, to overcome the difficulties they are experiencing. This legislation will provide for payments to the States of £142,000,000. Included in that sum is £21,000,000, which is additional to the amounts that the States are eligible for under the tax reimbursement formula. The States asked the Commonwealth for £31,00.0,000 extra, and for any honorable member to say that because the States accepted the £21,000,000 offered by the Common.wealth they were satisfied with that payment, is to disregard the facts. If the States had not accepted the sum offered by the Commonwealth, they would have forfeited any right to any sum additional to that -provided by the formula laid down by law. Therefore, it is quite clear that the Premiers of .the States had to abandon their attempts to obtain an additional £31,000,000 and accept the £21,000,000, or get nothing extra at all. The Premiers had no choice, although they definitely required much more money than was offered by the Commonwealth.
The financial position of the States is far from satisfactory, and the sums of money to be provided in this bill will do nothing to cure that position. During the last three years the deficits of the Government of Victoria have amounted to £3,127,000. The deficits of Western Australia in the same period have amounted to £941,000, and those of Tasmania have reached the sum of £351,000. In the last three years the total deficits of the six States of Australia have totalled £3,493,000. Therefore, it is quite obvious that in spite of the fact that the sums paid by the Commonwealth to the States in the last few years have increased each year, the financial position of the States is most unsatisfactory. Moreover, their difficulties have not been lessened by their vacation of certain taxation fields.
Since the passing of the States Grants (Tax Reimbursement) Act of 1946, because of general financial conditions in Australia and because of inflationary conditions here within the last three or four years, the annual amount paid by the Commonwealth to the States has increased from £40,000,000 in. 1946-47 to £135,000,000 in the last financial year. During the present financial year the amount will rise to the extraordinary sum of about £142,500,000. We must carefully consider now whether we are making an adequate provision of money to the States to enable them to function, properly. It is olear that, having lost the right to levycustoms duty and income tax, the State*cannot draw taxation from as wide a field as can the Commonwealth. Consequently, the States now receive about 50 per cent, of their incomes from thu Commonwealth’ under the tax reimbursement scheme. Last year the Commonwealth granted the States about £47,000,000 in addition to reimbursements under the States Grants (Tax Reimbursement) Act. This year about £46,500,000 more than the £142,000,000 that will be allocated under this measure will be paid to the States for various other purposes.
One is entitled to put before the House the reasons for the financial difficulties of the States. The three functions of the States which have had most effect upon their adverse financial position, are the conduct of railways, of health and social services and of education services. In fact, I believe that the deficits in State railway finances during the last ten years have amounted to a sum between £50,000,000 and £100,000,000. As these three services now given by the States to the people are the main causes of State deficits, would it not be better in the interests of the people that they should be taken over and controlled by the Commonwealth?
– The States would never agree to that.
– I do not suggest that the States would be a ready party to such a suggestion, but expenses in those three fields are continually increasing, and the financial position of the States is consequently continually getting worse. Therefore, I suggest that it might be in the interests of the community as a whole if the matter as to whether the Commonwealth should take over those three services should at least be investigated. T put that suggestion forward for honorable members to consider.
The whole system of financing the States is unsatisfactory. There have been many changes during the last 53 years, one of the most important being the change in the financial relationship between the Commonwealth and the States.
Now, if the States cannot balance their budgets and carry out services effectively in the interests of the people, the Commonwealth receives the blame. Therefore, instead of having one nation, one people and one destiny, we find hostility and antagonism growing between the central and the State governments. Such hostility might do great damage to the Commonwealth and destroy our unity. It certainly could not help to create that feeling of amity and goodwill which is essential if we are to build the Commonwealth into something great. In order that all such difficulties might be overcome, a convention should be held for the express purpose of dealing with two matters, the first of which is whether State financial rights can be established on a permanent basis, and, second, whether or not some functions that are now carried out by the States should be placed under the control of the Commonwealth. Such a convention might create better understanding and overcome some of our present difficulties. If we could have such a convention and if its results should be as I suggest, then we shall have done something in the best interests of the nation. The Opposition supports the measure.
– This bill is complementary to the States grants legislation. Section 5 of the States Grants (Tax Reimbursement) Act 1946-48 empowers the Australian Government to give financial assistance to the States, and there is an implied contract in the legislation that if the State governments vacate the field of income tax the Commonwealth will collect income tax for them and hand it over to them. Of course, that legislation is not now before the House, but this bill is complementary to it and seems to be designed to give an amount of money to the States which is additional to the amount arrived at under the formula contained in the States Grants (Tax Reimbursement) Act. The formula provides that £120,000,000 shall be paid to the States. This bill will provide £21,900,000 more than that sum, and of that amount, £8,525,000 will be paid- to New South Wales. Consequently, New South Wales will receive a total payment from the Common wealth of about £56,000,000. I suggest that honorable members whose electorates lie in New South Wales might find themselves in some difficulty in being called upon to vote for a measure of this kind, because they know that when the Government of New South Wales receives the money it will waste it.
As the honorable member for Bendigo (Mr. Clarey) has said, an almost intolerable situation exists at present, because this Parliament is compelled to vote money to the States. But when such money has been received by the States, this Parliament has no control over the spending of it. When the Parliament votes money to departments of the Australian Government, it still retains control over the spending of that money through the Ministers who are required to answer to the Parliament upon their administration. Consequently, the House can keep a close watch over all expenditure. However, in our financial dealings with the States, the Prime Minister (Mr. Menzies) and the Treasurer (Sir Arthur Fadden) met the State premiers in conference and, acting in good faith, decided to pay an extra £S,500,000 to New South Wales. The Parliament, therefore, is reluctantly compelled to honour the contract thus entered into and to vote the money. However, certain facts about Commonwealth and State relationships must be taken into consideration. The New South Wales Auditor-General, who is not a politician, but is a public servant appointed by the New South Wales Government, has some extraordinary things to say about expenditure by the New South Wales Government in 1952- 53. One quarter of the current financial year has passed, and already a quarter of the extra £S,250,000 has been expended by New South Wales. We know now, as we vote this money for allocation to New South Wales in this intolerable situation in which we find ourselves, that the money will be wasted. It is only necessary to examine, for instance, the accounts of the New South Wales Government Railways to find how this money will be expended. The New South Wales railways have had an enormous total deficit over the last four or five years, and it is estimated that they will show another deficit for this financial year. The
Auditor-General has listed the financial results of New South Wales railway operations over a period of seven years.
The financial results of the operations of the New South Wales railways for those years are as follows: - 1946-47, deficit of £1,557,942 ; 1947-48, surplus of £111,585; 1948-49, deficit of £1,915,785; 1949-50, deficit of £2,494,605; 1950-51, deficit of £6,417,432; 1951-52, deficit of £2,452,087; 1952-53, deficit of £1,449,839. The New South Wales Department of Transport, with which the AuditorGeneral also deals in his report, has shown what he terms “ deficiencies “, in the last seven ‘ years. The deficits incurred in those seven years by the metropolitan transport services of New South Wales were as follows :- 1946-47, £536,093; 1947-48, £601,657; 1948-49, £272,008; 1949-50, £688,666; 1950-51, £1,371,571; 1951-52, £3,020,293; 1952-53, £3,270,227.
The Auditor-General goes on to say that these services are losing passengers. That is, they are declining in value to the community although the population is increasing. It is most interesting to examine the actions of the New South Wales Labour Government in regard to the sacred Labour policy of socialism. That Government actually has no policy, but there is in existence a Labour policy of socialization, which is a little frayed these days. Under that policy the New South Wales Government embarked on the operation of what it chooses to call “ State coal mines “. The one to which I shall refer is not really a mine at all. The so-called State coal mine at Oakdale has already been responsible for an expenditure of £750,000 on the sinking of a shaft. The shaft will have to be 1,300 feet deep before it reaches the coal seam, but after having expended that vast sum of money the New South Wales Government has managed to sink it only 180 feet. That is socialization in operation. Mr. Clinton, a private coal-mine operator in the same area, who started operations with a wheelbarrow and a shovel, now has in operation a mine that produces thousands of tons of coal a day. He required only a small amount of capital to start operations. He spent probably no more than a few thousand pounds on development of his mine, and he paid for that development out of profits as he went along. The State coal-mine shaft, on which £750,000 has already been expended still has 1,120 feet to go before it reaches the coal seam. The New South Wales Auditor-General said in his report that he was not able to furnish any accounts for the mine, because they had not yet been presented, but he said a very interesting thing. He s’aid that an investigation of the affairs of the mine was being carried out. That investigation is not being carred out by the New South Wales Department of Mines, or by the Auditor-General or any such authority, but is being conducted by the New South Wales police. The police were not asked by the Government or any other similar responsible authority to investigate the affairs of the mine, but were led by something else to make their investigation. When I suggested to the New South Wales Government on the 13th January that it should not interfere with the police investigation and prevent the police, who are paid out of the special financial assistance that we give to the State, from doing their duty by calling them off an investigation that might embarrass the friends of the New South Wales Labour party, the New South Wales Premier replied that there were no skeletons in Labour’s cupboard, and covered four pages of one newspaper in replying to my statements. But the police, stung by my charge that politicians were interfering with them, and by the Premier’s statement that there were no skeletons in the cupboard - because the police knew that there were plenty of skeletons in the cupboards at Leichhardt and at the Sydney Town Hall - said that they would go up to State Parliament itself and arrest a man who stands beside a member of the State Labour Government.
– Order ! The honorable member for Macarthur (Mr. Jeff Bate) is getting fairly wide of the scope of the bill.
– When this matter was being dealt with in the State House, the House was quiet, because everybody was so horrified by the whole thing, and because there are strong forces within the Labour movement in New South Wales that have decided that the State House will be cleaned up, even if the Labour
Government goes out of office in the process. These forces are doing a good job Of cleaning it up.
-Order ! Those forces do not come within the scope of this debate.
– I return to the subject of the State coal mine at Oakdale. I paid a visit to that place while carrying 40ut my responsibilities in a way in which :some members of the New South Wales Parliament should have carried out theirs, and I found that at that mine, on which £750,000 has already been expended -out of money for the collection of which this Parliament is responsible, there was no proper supervision or control of materials. Materials were being filched day after day. It was a common thing for anybody employed at the mine to take away anything lie liked. If a heap of window frames was deposited on the ground-
– I rise to order. For the guidance of subsequent speakers on this side of the House, I ask you, Mr. Speaker, to state whether the honorable’ member for Macarthur (Mr. Jeff’ Bate) is in order in discussing how the States may intend to expend die money that is to be allocated to them under this bill. If he is to be allowed to do so, I take it that we shall have complete liberty to discuss the whole of the expenditures of the States and the whole of the State budgets.
– Speaking to the point of order, I ask why, if we are not to be permitted to discuss how this large amount of £142,000,000 may be expended by the States, this bill has been brought before this House at all ?
– Order ! I think we have to draw the line somewhere on this discussion. I have already called the honorable member for Bendigo (Mr. Clarey) to order for going beyond the scope of the bill. I think that we should confine this debate to the question whether or not this money is to be voted for the purposes of the States. I do not think that this Parliament is constituted in such a fashion as to enable it to set itself up as a court of inquiry to investigate the methods employed by the State governments. The States have their own parliaments which must perform that function. I consider that our business here is to decide whether or not this money is to go to the States. For that reason I am attempting to keep the debate within what I believe to be the correct limits, which, I admit, are narrow.
– May I say with great respect that if you hold, and the House agrees, that I am not to be permitted to discuss the methods of expenditure of the amounts to be allocated to the States, then this House will have lost complete control over this matter, although it takes responsibility for the raising of the money. A democratic principle is involved in this matter. That principle is that those who expend the money should have the onus df raising it. If you, Mr. Speaker, rule, and the House decides, that I may not discuss the expenditure of this money, and a precedent is thereby established, we shall have divorced ourselves from control over this amount of £142,000,000 and similar amounts paid to the States. We can blot these amounts out of the budget. I suggest, with great respect, that that opinion should be placed before the State Premiers at the next conference of Commonwealth and State Ministers. We cannot alter the decision of the last conference, because u contract has been made, but some very serious things have been brought to the notice of honorable members and if they are not ventilated here on this occasion then I do not know where and when they can be ventilated. I suggest that it is important, when such a large amount as this is being voted by the Parliament, that honorable members be permitted, in the few minutes of speaking time that is available to them, to have some latitude to advance a case and to give the House the information that they have acquired about expenditure in the States. This bill will be passed in a short time. Money is being voted by this House with breathtaking speed at the rate of about £30,000,000 an hour, which is £500,000 a minute. I suggest that when you gave your ruling in respect of the statements of the honorable member for Bendigo (Mr. Clarey) you had not seen clause 3 of the bill which mentions each State individually. If we may not discuss State expenditures then we are giving away the control of the purse, which has been the prerogative of British parliaments ever since it was won by an English parliament centuries ago. I am asking that I be permitted to discuss the waste of money by New SouthWales, particularly at a place called Tallawarra.
– Order ! The honorable gentleman has put what amounts to be a very lengthy question to me. I can only tell him it is my considered view that the power over the expenditure of moneys by the States was surrendered by the Commonwealth when the legislation to provide for uniform taxation was passed, and this Parliament undertook the unthankful task of raising money on behalf of the States for expenditure by them. I do not think that we in this House are equipped to delve into the methods by which the States expend that money, because if we do so in the case of New South Wales at the wish of the honorable member for Macarthur, the same condition will have to apply to every other honorable member who disagrees with expenditure by the Government of the State in which his electorate is situated. Consequently, we should be here for a very long time discussing something in regard to which we cannot apply a remedy.
– I wish to speak to the point of order. You have said, Mr. Speaker, that what we are discussing now is whether or not this money should be granted to the States. The reasons which may actuate us in making our decision will depend upon what we know about the way in which the States intend to expend the money, and have expended similar amounts that we have granted to them. I agree that we are placed in an unfortunate position as a result of the legislation to which you have referred, but we arc placed in that position and we have to “consider whether or not this money should be granted. In considering that matter we have an absolute right to turn our minds to the way in which the money is likely to be expended, because otherwise we shall be unable to have any clear view of whether or not we should in fact agree to this bill.
– I also desire to speak to the point of order. Having listened to the views expressed on this matter I am of the opinion that a literal interpretation of your ruling, Mr. Speaker, will, in effect, prevent every honorable member from speaking effectively on this bill. I cannot see how we can do so if we may not discuss the ways in which we know the money will be expended by the States. I respectfully ask you to consider the points raised by the honorable member for Mackellar (Mr. Wentworth) and myself.
– I can assure honorable gentlemen that I have given attention to those aspects of the matter. The House is master of its own business, and I shall be happy to accept a motion of dissent from my ruling. If the House does not agree with my ruling, and wishes to have a completely unlimited debate on these matters, then I have no feelings on the matter. I may say in reply to the honorable member for Mackellar (Mr. Wentworth), that if strong feelings are held by honorable members regarding the wastefulness of the States they have a duty to vote against the bill.
– With great respect for your ruling, Mr. Speaker, which I know you have given in order to avoid debate, which in your view, would be unnecessary and would be duplicated in another place, I am bound to say that I still have to fight for my rights.I now inform you that I propose to move dissent from your ruling to enable the House to discuss the way in which this money may be expended by the States.
I therefore move-
That the ruling be dissented from.
– I second the motion.
– Will the honorable gentleman please put his motion in writing ?
Mr. Jeff Bate having submitted in writing his objection to the ruling,
Question put -
That the ruling be dissented from.
The House divided. (Mr. Speaker - Hon. Archie Cameron.)
Majority . . 2
Question so resolved in the affirmative.
Mr. CREAN (Melbourne Ports) f”3-41]- - This legislation is of an annual character, because each year this Parliament is required to vote ever-increasing sums of money to finance the ordinary services of the State governments. The grants provided in this bill and in the other related measures which follow it show clearly the difficult position in which the State governments are placed to-day. I do not intend to traverse, as did the honorable member for Macarthur (Mr. Jeff Bate), the administrative shortcomings of the State governments. I shall content myself with mentioning some of the difficulties which they experience in carrying out their functions. It is becoming increasingly difficult for the States to function under our present financial system because not until a month or two before the State budgets are prepared do the States know precisely the amounts of revenue or loan moneys that will be made available to them by the Commonwealth. Only after protracted deliberations at conferences of Commonwealth and State Ministers are the amounts of money to be made available to the States finally determined. Such money as is granted to the States by this Parliament is granted to them grudgingly and not in the light of the important and varied functions which they have to perform.
The honorable member for Bendigo (Mr. Clarey), in an admirable speech, in which he traversed the history of these financial arrangements, reminded us that the States are charged with such important administrative functions as those which relate to education, railways, health and certain social services, and that because costs are continually rising the States are finding it increasingly difficult to balance their budgets and are becoming more and more dependent upon additional grants by this Parliament. In these circumstances it is exceedingly difficult for the States to plan constructively in respect of either their administrative functions or their developmental works programmes. The important factor from the point of view of the States is the total amount of money which they are to receive from the Commonwealth, whether from loan funds or from revenue. The States are not in possession of sufficient information early enough to enable them to plan constructively in relation to the functions which fall within their purview. I am familiar with the circumstances of Victoria. I know the intolerable position in which the Government of that State is placed in connexion with schools, hospitals and many other activities. This year, the Victorian Government did not know until August how much money would be provided for it under this measure. It did not know until two or three weeks before the Victorian Treasurer prepared his budget how much money would be available for the carrying out of its loan works programme. That position is intolerable, and cannot be allowed to continue indefinitely. The States, like the Commonwealth, are caught in the inflationary spiral. A conference of Commonwealth and State Ministers was held in Canberra on the 20th and 21st February, 1953, and the report of the proceedings was laid on the table of the House recently. I notice that the Premier of South Australia, Mr. Playford, said-
- Mr. Playford indicated that the total tax collections had risen as the result of inflation and rising national income, but that the proportion of the total revenue available to the States had been constant. Mr. Playford said -
When the Commonwealth pushed the States out of the field we were getting 3i per cent, of the national income and the Commonwealth was getting lj per cent. That was the position when we went into partnership. Now the position is that we are still getting 3i
Ser cent, of the national income, but theommonwealth is getting 11 per cent, of the national income.
The honorable member for Macarthur considers that extravagance is occurring in government. Evidently, the degree of extravagance on the part of the Commonwealth is nearly four times as great as the degree of extravagance on the part of the States. Of course, the situation cannot be judged so baldly as that, because to do so would be to overlook many essential factors that need to be considered in a proper evaluation of the position. The time has arrived when this Parliament should make a more sympathetic approach to the problems of the States. Members of the Labour party consider that the uniform tax system is the most admirable and suitable to Australia a3 a whole, but that the method of distributing revenues collected by the Commonwealth should be worked out sympathetically and co-operatively, and in a statesmanlike way.
– I rise to order. I suggest that the Vice-President of the. Executive Council and the honorable member for Mackellar have their quarrels in a less conspicuous place than at the table.
– Order ! I am not aware that a quarrel is taking place in the House. I direct attention to the standing order which states that honorable members, when entering the chamber, shall proceed to their seats.
– The time has come when the problems, to which I have been referring, should be approached in a more sympathetic way. The real problem is how to distribute the moneys that are collected from the national revenue to the best possible advantage, for the performance of the functions that need to be performed, whether in the Commonwealth sphere, the State sphere, or the local government sphere. We seem to be getting further and further away from any constructive approach to the problem. The Treasurers of the Commonwealth and the States confer annually in Canberra, but the proceedings are shrouded in mystery and secrecy. It would be extraordinarily difficult for any one who wanted to see Commonwealth and State financial relations in the proper perspective, to do so. An honorable member who asks a question in this House about interest rates is informed that such a matter is determined by the Australian Loan Council, which meets in camera. It is time that the Australian Loan Council ceased to meet in this mysterious way. Under present conditions, the representatives of the Commonwealth and the States return to their respective spheres, with mutual recriminations, and no one is satisfied with the result of the conference. Some of the important functions of government such as education and health, are intimate to the citizens of the States. Functions of that kind are required, under the Constitution, to be performed by the States, but they can only be carried out satisfactorily if adequate revenue is available. But income tax, which is the principal source of revenue, has been taken by the Commonwealth from the States.
The honorable member for Macarthur adopts the philosophy of a reformed burglar on this matter. He said that, after having stolen the purse, we have now to see that the redistribution of the contents is properly policed. It is not the function of this Parliament to scrutinize the budgets of the States. The grants are made by the Commonwealth to the States unconditionally, in order to allow them to function at the standards that we have come to expect in this community. It is not incumbent on members of this Parliament to criticize the financial operations of the States, because, to begin with, they are only in possession of secondhand and often tainted information about such problems. But the citizens of a State are aware of the functions that their government is required to perform, and of the difficulties confronting their government because the Commonwealth has. control of the principal sources of revenue. This Parliament should be most careful in the exercise of this responsibility and should not “vet” the individual functions performed by the States. This Parliament should definitely approach the problems of the States in a most sympathetic manner.
Unfortunately the Government lacks that sympathy and spirit of co-operation. The Treasurer, in his recent budget speech threw into the ring, with great aplomb, a statement about his generosity in abolishing the entertainments tax. He knew perfectly well that the States would be compelled to impose an entertainments tax in order to supplement their incomes. I consider that an entertainments tax and lotteries are dubious methods of raising revenue, but they are the only sources that are freely accessible to the States at the present time. The States can do better by collecting £1,500,000 from an entertainments tax, and distributing the proceeds in the form of government expenditure, than they can do by going without that revenue. This smug Treasurer, and other Ministers, have forced the States into adopting these dubious expedients for raising revenue.
The report of the Commonwealth Grants Commission is & most interesting document. It gives .us, among other things, an idea of the devices to which the States have to resort in order to supplement their grants from the Commonwealth, and it indicates the increasing degree to which the States are becoming dependent upon grants from the Commonwealth to finance their ordinary processes of government. The nineteenth report of the Commonwealth Grants Commission, which is the latest report of that body available, sets out the total sources of
State revenue, and shows the degree to which the States are dependent on Commonwealth grants. The total revenue of all States in 1950-51 was £145,533,000 and of that amount, £90,107,000 was received by way of grants from the Commonwealth. I shall refer to the sources from which the States derive revenue in order to show the kind of devices to which they have to resort so as to finance some of their functions. Motor taxes yielded £1 17s. Sd. a head, probate and succession duties £1 lis. 5d., other stamp duties £1 Ss. lid., land tax 3s. 4d.. racing 9s. lid., liquor 6s. 7d., and licences of other kinds
One vague gentleman who exists behind the scenes in Australian financial relations is the Co-ordinator-General of National Works. This official submitted a report to a meeting of the Australian Loan Council recently, and pointed out. that the States are not undertaking new works. He said, in effect, that the States had only sufficient revenue to complete works that had already been commenced., and even then, the rate at which the works were being undertaken had been retarded. The Australian community will encounter serious trouble in the next three or four years, if economic difficulties arise, because no new State works are being planned. A government cannot suddenly begin to build a new clam, or enlarge a dam, or improve power facilities. Such works have to be planned in advance for years. Educational facilities and health schemes are in a similar position. A government needs to know, perhaps five or ten years in advance, the amount of income that it is likely to receive before it can commit itself to a works programme.
Unfortunately, the States do not have that prior knowledge, because of the haphazard machinery which is now in use to determine the distribution of tax collections. The Commonwealth is in a fortunate position, because it can determine first the total amount of revenue that shall he raised, then the proportion of receipts that shall be apportioned to its own use and then whether capital works shall bc paid for out of revenue. At that point it, can take the grand action of telling the States that their reimbursements will be slightly bigger this year than they were last year.
I shall cite an example to illustrate my meaning. Last year, reimbursements to the States amounted to £135,000,000. This year, the reimbursements will be £146,000,000. The difference of £11,000,000 is less by £4,000,000 than the Commonwealth’s incorrect estimate - £15,000,000 - of its own defence expenditure. I advise the honorable member for Macarthur to examine the shortcomings of the Government which he supports before he becomes critical of a Labour State Government and attempts to smear it in a political sense. The States have their own problems, and the Commonwealth has its problems, but the Commonwealth must adopt a more sympathetic and sound approach to the problems of the States. Wc all are members of the Commonwealth, members of a State and members of a local government authority. Our job as citizens is to ensure that the economy to which we belong shall be allowed to function in the most satisfactory manner. This is a recurring annual measure. The fact that grants to the States are dealt with in this way instead of being considered in advance is producing a kind of governmental paralysis in the States and, if we have governmental paralysis in the States, there will not be much activity in the federal sphere.
.- I approach this matter with a feeling of despondency. “When the House considered a similar measure last year, I hoped that I had seen the end of this arrangement for the financing of the States and that we would be given some indication this year of plans to put an end to what the honorable member for Melbourne Ports (Mr. Crean) has described as the disastrous paralysis of Federal and State financial relationships. As the honorable member said, it has become a matter of making an annual grant to the States, and the amount provided each time depends upon how much each of the States can wring from the Commonwealth and how much a reluctant Commonwealth is prepared to concede to their demands and I am despondent, because I do not believe that the problem can be dealt with as easily as the honorable member for Bendigo (Mr. Clarey) suggested when he opened the debate on behalf of the Opposition. The honorable gentleman outlined the various problems that confront us and suggested methods of solving them. One proposal was that the Commonwealth should take over functions that are now discharged by the States, such as public health, education and transport. He considered that these activities drew too deeply upon the resources of the States, because, notwithstanding the large amounts disbursed by the Commonwealth for these purposes, they were hampered by lack of funds. I am not in a position to say whether a sound case can be presented in support of the arguments of the honorable member for Macarthur (Mr. Jeff Bate). I do not think it would be possible for us to attach conditions to grants made to the States and police them effectively. It would be of no use simply to make pious resolutions unless we were in a position to enforce them. Any attempt by the
Commonwealth to control the activities of the States and police the expenditure of their funds would lead us into all sorts of new fields that would cause embarrassment to everybody concerned. As the honorable member for Melbourne Ports has said it would mean the end of the federal system.
The suggestion by the honorable member for Bendigo that the Commonwealth should assume some of the functions of the States does not strike at the root of our problems. Very few honorable members, I believe, would be prepared to have the Commonwealth assume responsibility for public transport, public hospitals or public education throughout Australia. Any such move would be disastrous. Surely it is clear to every honorable member that the Commonwealth already has so much to do that it simply cannot discharge all its functions effectively. It is doing its work, but it is not doing it efficiently. Unless government is effective, it loses its prestige and we hear complaints of the sort that were aired earlier to-day in the course of the “ Grievance Day “ debate and the Parliament and the Government are criticized as institutions. The consequences of the loss of prestige by government are too terrible to contemplate. Therefore, I do not want to see the Commonwealth loaded with additional responsibilities. In fact, I favour the reverse process. I want the Commonwealth to hand back to the States many of the functions that it has assumed in the last ten years. The States, in turn, should refer many of these functions to local government authorities. This would result in improved administration of governmental activities by agencies that are peculiarly capable of carrying out those activities. The Commonwealth should hand back its acquired functions so that we may be free to do as the honorable member for Macquarie (Mr. Luchetti) suggested during the “Grievance Day” debate this morning. I do not approve of the honorable member’s planning, or of the ideas behind his planning, but I want the Commonwealth Parliament to have time to discuss the problems of government that matter and to be able to see the objectives towards which it should be striving. It is not able to do so at present because of the maze of duties that the Commonwealth is trying to perform, and which it performs very badly.
I agree with the honorable member that one way of achieving effective discussion of these matters would be to call a convention which could calmly and objectively study the whole field of the financial relations between the Commonwealth and the States. Finance has become the Achilles heel of the Commonwealth. It is true, as Alfred Deakin said, that the States, which fondly believed themselves to be free, are tied to the financial chariot of the Commonwealth. They are being dragged along in the train of this juggernaut, and are not free to do the job that they are required to do under the Constitution. Therefore, I lend my support wholeheartedly, as I have done for many years past, to the idea of a constitutional convention. I do not believe that our problems can be settled either at conferences of Commonwealth and State Ministers or in debates in this House. All the results that have emerged from the various discussions of Commonwealth and State treasury officials and of Premiers and Treasurers indicate that we need a much more far-reaching method than the present one of dealing with the redistribution of the resources of the Commonwealth so that adequate finance may be provided to the various agencies that perform the work of government in this community. I have no illusions about the difficulties of a convention such as the honorable member for Bendigo has suggested. I do not believe that it would be of any use to have an elected convention. I associate myself with Sir Robert Garran, who considers that it should be a nominated convention and that we should try to hand-pick the people who would be able to contribute most effectively to the work of the convention. At any rate, there should be some way of devising a means of distributing revenue from direct and indirect taxes in equitable proportions to the Commonwealth and the States, from which funds could percolate to local government, in order to carry out the business of the country. The solution of this problem requires an act of statesmanship of which, in my opinion, we are not capable at present. “We are prepared to talk of these difficulties, but we run away from them. Real statesmanship is needed if we are to give a lead to the community. As the honorable member for Melbourne Ports has said, we are being driven dangerously towards the end of federalism in Australia. Can we contemplate with equanimity the end of our federal system ?
– I cannot imagine that the honorable member is able to do so. Any system of unification is bound to break down, because it would result in the handing over of the full power of government to the Public Service. The Parliament would be handicapped and incapable of dealing with the problems of government, and, more and more, the work would fall into the hands of the Public Service, in much the same way as it is doing at present. Unification would simply mean the end of parliamentary government in Australia. The uniform system of taxation, which we are discussing in this debate, is leading to the end of parliamentary government in the States. How can we conceive of responsible State governments when they are dependent for their very existence upon the funds that are made available to them by the Commonwealth Government? They cannot be independent. They cannot make firm plans, nor can they owe any responsibility to the electors. The system that we have developed places the State parliaments in a position of dependency upon an outside government, and therefore they cannot be responsible to the electors or to their political parties. They simply take what they are given. I believe that this system also will result in the end of ministerial responsibility. Ministerial responsibility is becoming a little threadbare even in this Parliament. There was a time when Ministers were responsible for decisions that were made and actions that were taken. Now it seems to me that they are often merely vehicles for communicating decisions that have been made elsewhere. If we lose the substance of ministerial responsibility, we shall lose the whole substance of representative government and, therefore, of the parliamentary system under which we live. That is the direction in which the present method of financing the- States is leading us.
Various honorable members have argued from time to time that the system of uniform taxation, under which the Commonwealth distributes funds to the States, is the only means of promoting a true. Australian sentiment. One honorable member earlier to-day in another debate urged us to stop thinking of ourselves as New South Welshmen, Victorians, South Australians, and so on, and to think of ourselves as Australians only. I believe that this idea is based upon a fallacy. We can still think of ourselves as being Australians while we continue to take pride in belonging to Victoria, South Australia, or some other State. The. advantage of emphasizing loyalty to a State is so great that it outweighs the advantage of setting aside. State allegiances in. order to think of ourselves only as Australians. Competition between the States,, with each State trying to give expression to the personality of its population, is far more valuable than could be any attempt to make everybody conform to a common standard. Why on earth should we want to have a uniform standard, even in relation to wages, throughout all States? Wage standards vary under present conditions, of course, but I would allow the variations to become even more marked. The only realtest of our progress lies in our capacity to manifest our differences and to ensure that there shall be definite variations of type in the different States. Those variations can best be created by allowing the various entities in a system such as we have to play their proper part and take their proper place in that system.
I do not believe that the system under which we are working- now should be allowed to continue- in existence for one day longer than is necessary. We should press for a convention to be held to thrash out these problems. I believe it should b® a nominated convention. If we retain, the present system, we shall destroy federalism., State parliamentary government and the principle of ministerial responsibility. The advantages of a system of uniform taxation are far- outweighed by the advantages’ to be gained from the maintenance of the independence of the States and1 the survival of the federal system and the principle of ministerial responsibility-. The answer to our problems is not to be found in the handing over to. the Commonwealth of a series of functions burdensome- to the, States: It is to be found in. handing back to- the States functions, that have been taken from, them during the last ten years. The Commonwealth should be free to act as a thinking body, and. the States should be executive, bodies. Let. the Commonwealth think in terms of standards and endear yours. Let the States think in terms- of the application of those standards, and yet be free to do what they want without direction from the Commonwealth. I want functions to be diverted from tha Commonwealth to the States and local authorities.. I want the functions, of the Commonwealth to be pruned to their very roots; If that were done, we should not have some of the scandals with which we have been concerned in this House to-day.
.- The- honorable member- for Warringah (Mr. Bland) inevitably harks back to- the days before the Boer war. He has resented every development of governmental activity, whether in the State or the Commonwealth sphere-, which has occurred in this country during the last half century. His complaint is not that the functions of the Commonwealth which have come into existence during the lasthalf century have been carried on by the Commonwealth rather than by the States, but that they have been exercised at. all. He does not like the development of Governmental and public control and responsibility that has characterized the first half of this century.
The bill provides for a grant to the States to enable them to carry on the everyday functions which are at present their responsibility. It does not deal’ with capital works, which are- financed from loan funds. It is interesting toobserve that the value of the money that the Commonwealth will make available to the States this year is less than thevalue of that which was made available during the last two years. Let me cite the relevant figures for the four years during- which this Government has had an opportunity. to present budgets and consequential bills to the Parliament. In 1950’, the’ States were entitled to £70,398,000 under the tax reimbursement formula and were given special financial assistance of £20,000,000. In 1951, the year of the horror budget, they were entitled to £86,423,000 under the formula and were- given special assistance of £33,577,000. In 1952, they were entitled to £10S,800,000 under the formula and were given special financial assistance to the extent of £27,100,000. This year, it has been estimated that they are entitled to £120,549,000 under the formula, and it is proposed that special assistance of £21,910,000 shall be made. Honorable members will notice, that payments under the formula, which takes into account the decrease of the value of money and the increase of the population of the States, increased each year. The figures are £70,398,000, £86,423.000. £108,800,000 and £120,549,000.
This Government, like its predecessors, lias always realized that it is necessary to give the States special financial assistance in addition to grants under the formula. The amount of that assistance has been reduced in each of the last two years. It is now practically as small as it was in the first year that this Government was in office. It was £20,000,000 then, and it is £21,910,000 now. In 1951, it was £33,577,000, and in the following year it was £27,100,000. Since 1951, there has been a progressive decline of the special grants to the States, despite the increase of their populations and the decrease of the value of the £1. The result and purpose of the Government’s financial policy has been to curtail the activities which, under our constitutional distribution of powers, are carried on by the States. Even if the value of the Australian £1 and the population of the Australian continent had remained static, the States would have had to curtail some of their activities, because they have been receiving- fewer pounds, but, because the value of the £l has decreased and the population has increased, they have had to curtail their activities still further. It, ill becomes Government members to criticize the way in which the States have spent their money and carried- on their activities, because never in the perennial’ debates of this kind have the members of the parties of the resistance made any suggestion as to the activities of the States which should be curtailed. They have left the States to stew in their own juice and work that out for themselves.
The honorable member for Macarthur (Mr. Jeff Bate) referred to a contract made between the Commonwealth and the States at the conference of Commonwealth and State Ministers held in August. No contract was made. It was entirely a one-way show. On the 10th August, the Prime Minister (Mr. Menzies) is reported to have announced the amount of the supplementary financial assistance to the States. He said that the money would be allocated either by agreement among the States or, failing that, by the Commonwealth. The States did not agree, and the Commonwealth, acting unilaterally, made the allocation. There was no contract. That was imposed on the States.
This annual reimbursement arises from the uniform taxation system which was introduced during the war. It affected two fields of taxation - income tax and entertainments tax. It is interesting to observe that although the Government has vacated the entertainments tax field, honorable members opposite criticize the States that seek to impose entertainments tax themselves, despite the fact that, for a decade or more before the introduction of uniform taxation, those States imposed entertainments tax or, as some of them called it, amusements tax. We well remember that during the conference of Commonwealth and State Ministers in July last year, the Prime Minister announced, with all the orotund eloquence of which he is capable and which he displays at the drop of a hat, that that was the last year in which the Commonwealth would levy uniform taxation, and that thereafter the States could levy their own taxes and take the responsibility for them. As with so many of the right honorable gentleman’s pronouncements, promises, threats or undertakings, he failed to carry that out. It is something that he could do unilaterally. The Commonwealth imposed uniform taxation, not the States. The Commonwealth could end it, with or without the concurrence of the States.
– Is that the course suggested by the honorable member ?
– Certainly not. The policy of the Labour party is perfectly clear. We say that there should be uniform taxation in this country, as there should be unification. We have said that for the last 50 years, and we shall continue to say it. We are more consistent than the members of the present Government, who threaten to do something but do not do it. The Prime Minister said that the Commonwealth would end uniform taxation. Surely, after his experience in public life both in the State and Federal sphere, he should realize that one should not make statements lightly. If he believed that he could do what he threatened to do, he was perfectly justified in making the threat and should have tried to carry it out. If, however, he did not think it could be carried out, the threat was an act of unconscionable frivolity on his part. He has not carried it out, and it is quite plain he has had his last opportunity to do so. The right honorable gentleman threatened to vacate the field of uniform taxation fifteen months ago. But the Commonwealth still occupies that field, and it is clear that, whatever party is in power in this Parliament, it will continue to occupy it. We on this side of the House applaud uniform taxation. Honorable gentlemen on the other side of the House may continue to operate the system, but they will continue also to moan and grieve about it. They have vacated the field of uniform entertainments tax. Let them be consistent and cease to complain about the States that are re-imposing that tax.
Reference has been made to the financial relationship between the Commonwealth and the States, which is, of course, the crux of this debate. The financial relations between the Commonwealth and the States were unbalanced well before uniform taxation was introduced. That fact was merely highlighted by the events of World War II. It was apparent after World War I., and before then it was plain to Alfred Deakin, as the honorable member for Warringah has said. No permanent formula for reimbursing the States can be devised. The Australian economy refuses to comply with the forecast of politicians who do not have constitutional power to control it. The best laid plans go astray, whether they be plans of Commonwealth politicians or
State politicians. Under the present antiquated and outmoded distribution of powers, neither the States nor the Commonwealth have control of trade or investment. We remember the subterfuge that the present Government had to adopt to impose control of capital issues. That is a necessary feature of the economy now, but the control cannot be exercised effectively in peace-time by either the Commonwealth or the States. Neither the Commonwealth nor the States has control of labour relations in this country. The Commonwealth Arbitration Court, the judges of which hold office for life and are responsible to no one, has chief control of vital matters such as wages, hours, conditions of labour and the discipline, if I may use the word, of both employees and employers. Since the end of the last war, the States haveshown that they are incapable of financing most of their functions without federal assistance. Quite apart from uniform taxation, the Commonwealth must subsidize the activities of the States. That not only applies to the claimant States of South Australia, Western Australia and Tasmania, who in any event would not be able to get legislation to raise sufficient income for their needs through their miner houses, which are controlled by small oligarchies, but it also applies to the other States. Not only does the Commonwealth make subsidies available to the States through the Commonwealth Grants Commission, but we also subsidize a great many State functions. We do it capriciously, and in recent years the present Government has regretted the necessity to continue many of these subsidies, although it has maintained them in a restricted form.
Now the Commonwealth must completely occupy or completely vacate those fields in which it assists the States. Honorable members on this side of the House believe that the Commonwealth must completely occupy those fields. Once we have taken the first step we must march right through the field. The honorable member for Macarthur referred to State railways. There is no doubt that if the Commonwealth were to take over State railways, as was suggested recently by the honorable member for Maribyrnong (Mr. Drakeford), the budgets of all the States could be balanced and State deficits would disappear. At the time of federation the railways were the greatest financial enterprises in this country and they were conducted profitably by the States. But time marches on. Just as the railways superseded canals as a primary means of transport, and the canal companies went bankrupt, so subsequent means of transport, not envisaged at the time of federation and probably resented by the honorable member for Warringah among others, have taken the cream of the traffic from the railways. The cream of the goods traffic has been taken by road hauliers and the cream of the passenger traffic, in which I include honorable members of the Parliament, has been taken by the air services. Nevertheless, the railways must continue to function. This country could stagger along without road haulage or airlines, but railways are essential both in peace and war. Our railways are not economic propositions but that is not because they are publicly owned. In Argentina, where the railways were privately owned, the British financiers who owned them went bankrupt and were glad to give them away. The only railways in the world which are privately controlled, and yet which contrive to make a profit are mostly those in the United States of America during and since World War II.
– And Canada.
– The Canadian Pacific Railways Company continues to operate at a profit because of early land grants and later subsidiary activities. The other railway, the Canadian National Railway, is in the same position as the Australian railways. Two private companies owned that line, but they went bankrupt and the Canadian Government had to issue bonds to finance its acquisition of the line and preserve the country’s credit. The first railways in Australia, I believe one was in the area of the Melbourne ports and the other from Sydney to Parramatta, both went bankrupt although they were privately owned, and since then all our railways have been publicly owned except the Silverton Tramway and the Western Australian Midlands Railway. Neither of those would be tolerated in any of our neighbouring countries. Our railways had to be financed in the beginning by selling bonds overseas. At least that was the way it was done in the light of the financial ideas of the time, and we have to continue to pay interest on those bonds, a charge which would never have been incurred if the railways had been under private management. Similar railways in the Argentine and in other countries of the world have ceased to be successful while under private management. The political colour of our States makes no difference to the position of their railways. There have been just as great deficits each year on the railways of South Australia as there have been on the railways of New South Wales, although five times as many people are employed by the New South Wales Government Railways as are employed by the railways of South Australia. For that I do not censure the Liberal Government of South Australia, which, under an anachronestic electoral distribution system, is there for ever whatever its crimes of omission or commission. Railway losses are an economic fact which must be faced by whatever government is in power in the States of this Commonwealth. If we should take State railways over, then State budgetary deficits would vanish and the States would be able to balance their budgets.
– But Commonwealth deficits would follow.
– May be, but the Commonwealth can raise taxation and loans, and has the control of credit. State governments cannot control credit. They can vote in the Australian Loan Council, and whatever may have been their political colour in the last few years they have outvoted the Commonwealth in the Australian Loan Council upon the matter of how much should be raised by way of loans. The Commonwealth has clearly shown, whatever its apologists may say, that it can flout the Australian Loan Council and refuse to raise the loans that the connell has decided could and should be raised.
– Nothing of the sort.
– The financial agreement was entered into a quarter of a century ago by the Australian people, and has worked well since then except on two occasions. One occasion was when the Government of New South Wales, under Mr. Lang, defied it, and the second occasion was when the present Prime Minister (Mr. Menzies) and Treasurer (Sir Arthur Fadden) also defied it. That is not a matter of politics, because in 1952 the Liberal Treasurers of Victoria, South Australia and Western Australia voted with the Labour Treasurers of the other States against the Commonwealth’s proposals. This year the same States, except South Australia, again voted against the Commonwealth’s proposals.
-Order ! The honorable member is proceeding to discuss loan matters which do not come within the scope of this bill. The measure before the House deals with a grant from revenue.
– I completely agree with you, Mr. Speaker. You must pardon me for answering similarly irrelevant interjections. Having allowed the interjection I suggest that you should allow me an opportunity of replying. The railways are the most striking example of the budgetary incapacity and. financial helplessness of the Australian States, but as long a3 uniform taxation continues, and it will continue whatever party may be in power, then the challenge will remain. The Commonwealth must take over the more expensive functions of the States. Every State government spends more on education than on anything else, and the next biggest vote is for health services. Honorable members on this side of the House believe that the Commonwealth must inevitably take over education and health services.
– Order ! We are not dealing with State budgets; we are dealing with a question of whether a sum of money shall be granted to the States. The House has decided that it may discuss what the States will do with that money, but we are not dealing with the internal affairs of the States.
– I was merely referring to the fact that the States will be spending on education and health most of the money which both sides will agree should be given by this measure. I suggest that the time will come when the Commonwealth will, itself expend that money on education and health. That is an inevitable trend, and the only way that we can get efficiency and responsibility in public administration in this country is for the Commonwealth to supervise the expenditure of the money that it raises. The same can be .said about many other long-range projects of the States in respect of electric power, national development and even justice. We .should act as one in this country because we are one people, although in peace-time we do not seem to be able to act in concert, and act rather as six separate countries. Could anything be so farcical as one country having six different sets of traffic laws and six different sets of legislation on health, pure foods, and so on? Is there any difference between the States which should make that necessary? That state of affairs causes litigation and is completely unnecessary.
– It is good for the lawyers.
– It is good for lawyers, but lawyers are sufficiently ingenious to find other ways of subsisting if this country were unified, but as long as we have a federal system and an arbitration system lawyers will not lack work.
– Does the honorable member advocate the abolition of the arbitration system?
– No. Only six of the seven existing systems.
– Order! The arbitration system is not involved in this debate.
– The honorable member for Warringah mentioned the matter of Commonwealth and State powers. The powers that were under discussion were not exercised by the States before federation; they have come into being since that time. Because the Commonwealth largely pays for many functions of the States, our view is that the Commonwealth should carry out those functions. We believe that the Canadian system is better than our federal system because under that system all new powers are automatically taken by the national parliament, and all the powers given to the provinces are specified. At best federation is a compromise, a temporary stage in our political evolution. The
States are neither flesh nor fowl nor good red herring ; neither national bodies nor local government bodies. They have not the means to be national and have not the time to be provincial. We do not advocate centralization, we advocate unification. Commonwealth departments are more decentralized than State departments. For example, the Postal Department and the Department of Social Services operate most effectively as decentralized services.
-Order ! Commonwealth departments are not under discussion. The bill before the House deals with a grant of money to the States, and I suggest that the honorable member discuss the bill.
– -The whole question is whether the federal or the State governments are best able to finance the governmental, administrative functions which are expected by the people of Australia. Our view is that those who pay the piper should call the tune. Those who raise the money, should spend it. The Commonwealth should refrain from raising any money other than that which it will expend for its own purposes in each year, or the Commonwealth should take over those functions of the States upon which the tax reimbursements are expended by the States. This Government should not make grants at all for State activities, or it should make adequate grants. That is both good politics and good economics.
– I do not intend to avail myself of the opportunity given by the Opposition to criticize the governments of the States. All I say is that according to a report in the press, a Government member of the Queensland legislature recently criticized the operations of the Australian Government in a debate in that Parliament. A. colleague has informed me that the same position arose in Western Australia. I saw an extract of the report which complained that the total amount collected by the Commonwealth in petrol tax had not been transferred to the States. That complaint has been answered fully by the honorable member for Bendigo (Mr. Clarey), who reminded the House that the petrol tax was originally intended to be a revenue tax.
The Labour Government allocated to the States about ?7,000,000 a year for main roads purposes. This Government gives them more than ?.16,000,000 a year for thelocal authorities.
Honorable members opposite claim that this Government has dishonored its promise to return to the States the taxing powers that they ‘held prior to the adoption of the uniform tax system. Nothing is further from the truth. When the Prime Minister offered to hand these powers back to the States the Premiers, especially the Queensland Premier, went back into their burrows. That is the reason why uniform taxation is in operation to-day. Only recently the Queensland Treasurer made the following statement in the Queensland Parliament : -
We were the highest-taxed State in the Commonwealth prior to uniform taxation and we have never made any .apologies for it. Wie are not likely to be tied up by an agreement that will place this State in the position of having to hand over the preparation of its budget to Sir Arthur Fadden and his other bushrangers in the Commonwealth Parliament
As an illustration of the confusion in the minds of Queensland ministers, 1 quote a statement made when this Government proposed legislation to make a special grant to Queensland. The Queensland Treasurer said - the fact as I see it, is that they want to keep Queensland away from the Commonwealth Grants’ Commission and for that, purpose they want to pass special legislation to give Queensland a special grant.
The following is an extract of the report of proceedings of a conference last February of Commonwealth and State Ministers : -
Mr. Gair. According to the figures given in the officers’ report we probably would haw had a better claim in the last few years to put before the Commonwealth Grants Commission than some, of the claimant .States have had.
– If you tell me you would like this matter to go before the Commonwealth Grants Commission, naturally I shall give if. fullest consideration.
Mr. Gair. No, I said earlier that I would be reluctant to do so.
Yet the Queensland Treasurer claimed that the Prime Minister was trying to force something else on to Queensland.
A comparison of these recorded statements shows that the States are indulging in untruthful political propaganda against the Commonwealth.
The honorable member for “Werriwa (Mr. Whitlam) said that the States were unable to carry on under the income tax reimbursement agreement. He seems to have forgotten that the terms of that agreement were reached between the States and the Commonwealth when a Labour government was in office. This Government is merely continuing it. It is also claimed that this Government is not increasing allocations to the States to a degree commensurate with the increased cost of commodities and labour. Honorable members opposite who make such claims forget that it was the introduction of the 40-hour week in New South Wales and Queensland which caused the prices of commodities and labour to increase. The New South Wales and Queensland Labour Governments should have considered the effects of their action before they took it, because the 40-hour week has certainly exaggerated the financial difficulties in which the States and all institutions now find themselves.
Claims that this Government is being niggardly in its treatment of the States are disproved by the figures, which show that in 1949-50, . when the Labour Government was in office, the Commonwealth under the agreement allocated to Queensland an amount of £14,814,649, whilst this year this Government is allocating to Queensland £28,023,735, or almost double the amount allocated by the Chifley Government. The Government is this year making an amount of £5,054,000 available for the relief of primary producers in Queensland, compared with the total of £2,245,652 made available by the Chifley Government in its last year of office. Yet a propaganda resolution was submitted to the Queensland Parliament last year criticizing the Government for its lack of assistance to the States. One extravagant gentleman went so far as to say that Queensland should get out of the Australian federation. That was a remarkably ill-timed and ill-considered statement, especially in the light of the claim by the Queensland premier, that his State cannot survive without some special financial assistance. Besides doubling this year the amount of assistance given to the Queensland primary producers by the Chifley Government, in its last year of office, this Government has increased its assistance to Queensland public hospitals from the amount of £980,000 a year paid by the Chifley Government to £2,250,000. It has also introduced a health and medical benefits scheme which is of inestimable benefit to invalids, age pensioners, ex-servicemen and other deserving members of the community, in respect of whom it pays State hospitals 12s. a bed a day. It pays them 8s. a bed a day in respect of other patients.
– The Government has destroyed the system of free hospital treatment.
– That is not true, we have preserved the system and every Queenslander knows that. The Government has helped Queensland to provide for the expansion of intermediate and public wards. More than 1,000,000 people in Australia contribute to hospital and medical benefits schemes at a rate of ls. or so a week in order to ensure that their families will receive the best hospital and medical treatment. In all, over 3,500,000 people are covered by the scheme. If that is what the honorable gentleman describes as the abolition of free hospital treatment he has a very curious idea of the minds of the people who contribute to medical and hospital funds. The Government’s hospital insurance scheme has, in a period of three months, converted one hospital’s deficit of £40,000 in New South Wales alone into a surplus of £50,000. As I have said, the Government will this year grant £2,250,000 to Queensland for hospitals but the Chifley Government did not grant Queensland even £1,000,000 a year for that purpose. Labour governments have been in office in Queensland for 35 years. When the Labour party first gained office in Queensland it produced pamphlets and little red books in which it condemned governments in the previous 50 years because the Queensland public debt had risen to £50,000,000. Labour governments have increased that debt to £204,000,000, although the first Queensland Labour Government gained office by promising to wipe out the debt. The Queensland Labour Government was apparently satisfied with the allocations it received when the Chifley Labour Government was in office, but it complains of this Government’s treatment of it, although in four years its loan allocations have been increased under this Government by £53,500,000 above the greatest amount of loan allocation made under the Chifley regime in a similar period. But Queensland still claims that its allocation has been reduced. The first Queensland Labour Government condemned previous non-Labour governments for incurring debts during the previous 50 years, but ignored the fact that the construction of great wharfs, railway systems, public buildings and other public utilities had been financed almost without exception, from the £50,000,000 that constituted Queensland’s debt when Labour took office. Since Labour took office 35 years ago, however, there has been three times the amount of expenditure in Queensland with nothing like such results. That State is still almost without irrigation. At the last meeting of the Australian Loan Council a statement was made that Queensland could not pay its way if it had to rely on the taxes collected within its borders. That is the position that the proud State of Queensland has come to after 35 years of Labour rule. It has to come cap in hand to the Commonwealth. Yet the Queensland Premier was reluctant to submit an application to the Australian Loan Council to come under the special grants. There is a want of tact and decency in the criticisms to which this Government is subjected by the States. The honorable member for Bendigo (Mr. Clarey) made an excellent and well-reasoned speech that was obviously based on close research, in which he traced the history of the financial agreement between the Commonwealth and the States. The States have received more sympathetic treatment from this Government than they have received from any previous government, yet they have abused it for purely political propaganda purposes. A member of the Opposition, who is a worthy and responsible honorable member from Queensland has ascertained that the States have socked away £9,500,000 about which the Australian Loan Council apparently knows nothing. If that information is correct, and it has been reported in the press, good luck to them. To-day, more than ever before, the States are able to function because of the generosity of the Menzies Government. The people of Queensland and of the Commonwealth as a whole have every reason to be grateful to the Menzies Government on that account.
Mr. DRAKEFORD (Maribyrnong) [5.2 . - Some honorable members opposite who have contributed to this debate have given a great deal of thought to the financial relations that should exist between the Commonwealth and the States in future years. Others, such as the honorable member for Macarthur (Mr. Jeff Bate), have taken this opportunity to have a “ go “ at the State governments. The States are suffering severely as the result of the rapid development of Australia. They are not obtaining sufficient funds to enable them properly to discharge their functions. I was very interested to hear the honorable member for “Warringah (Mr. Bland) suggest that there is a possibility that the Commonwealth will be forced to take over certain functions which are at present discharged by the States. Any one who has had any knowledge of the development of transport in Australia knows that the Status have to approach the Commonwealth for the provision of additional funds principally because of the losses they incur in the operation of their railway systems. The New South “Wales Government has been abused by honorable members opposite because of its alleged socialist tendencies, which are said to be detrimental to the interests of the people. “Whether States are governed by socialist or non-socialist governments, all of them lose heavily on the operation of their railways notwithstanding the fact that they are, perhaps, the largest revenue producing instrumentalities that operate in the State sphere. Recently, I suggested that the Commonwealth should consider taking over the State railways, not with the object of interfering with the activities of the States, but in order to relieve them of a heavy burden under which they have struggled unsuccessfully for many years. If I discussed this matter on a purely political basis, as some honorable members opposite have done, I should say that losses have been incurred by the State railway systems largely because the undertakings were financed from loans- which had been raised at excessively high rates of interest, and that this Government is applying a policy of high interest rates in order to enable its wealthy supporters to reap large profits on their investments. 1 remind honorable members that the Chifley Government financed the construction of many projects, such as the Snowy Mountains scheme, from loans raised at an interest rate of Si per cent.
-Order ! The honorable member is getting right away from the bill, which relates, not to the rate of interest on loans, but to the allocation of revenue to the States.
– A large portion of the moneys allocated to the States is used to meet losses incurred on the State railways because of interest on loans. Since 1946 the total loss incurred on Australian. railways amounted to £67,513,326. It is significant to note that the only railways system which made a profit in 1951-52 was the Commonwealth railways, which had surplus earnings over operating expenses amounting to £77,318, That surplus excludes interest on loan capital. I hope that this financial year the TransAustralian Railways will show a profit on its operations after providing for interest on capital. That very fine achievement is largely attributable to the use of diesel-electric locomotives on the Trans-Australian railway. The use of diesel locomotives has revolutionized the operation of the Trans- Australian line. It is true that a large amount of the money has to be provided for the purchase of diesel fuel from foreign sources. We look forward to the day when oil fuel will be obtained in Australia. The utilization of diesel locomotives on the Trans-Australian line will enable the Commonwealth Railways to reduce freights and fares to such a degree that the shipping interests’ will in future find it difficult to compete for the traffic offering.
I have obtained the figures showing the results of the- operations of the State railways systems- during the seven-year period 1946 to 1952. In New , South Wales, which has been referred to in critical terms by honorable members opposite as a State that is controlled by a socialist government, the losses’ amounted to £14,576^679. The total loss on the operation of the Victorian railways during the same period amounted to £14,274,104. It is apparent to any student, of railway problems that in present circumstances it is impossible for the State’ railways to make a profit. The States, because of the losses on their railway systems, have to come cap in hand to the Commonwealth each year seeking assistance additional to that provided for in the tax reimbursement formula. New South Wales railways showed a profit only during the war years in which a vast volume of war-time traffic was carried. In the first two years of the war, in 1939 and 1940, the New South Wales railways were operated at a loss, but a profit was earned in each of the following five years. In 1946 the New South Wales railways made a small profit of £149,588. Since then the State railways have been operated at a loss. The experience in New South Wales is characteristic of that of all the States.
In’ Western Australia the accumulated loss on the railway system for the period from 1946 to 1952 amounted to £.14,589,530. A State such as Western Australia, which extends over a vast area but which has only a small population, has no hope of breaking even in the operation of its railways. Every person who knows anything about railways knows that the railway equipment and permanent ways in Western Australia have gone almost to rack and ruin. If a war broke out again, other than an atomic war, the difficulties associated with the movement of troops to Western Australia would be vastly greater than they were during World War II. In the seven-year period from 1946 to 1952, Victoria lost £14.000,000 on the operation of its railways system and Queensland lost £7,537,576. These figures indicate the extent to which the States are forced to seek assistance from the Commonwealth because of the losses incurred on .their railways systems .alone. Victoria’s experiment in diesel-electric locomotives has not been .as successful as has the institution of that .system on the TransAustralian line because of the failure of the Victorian Government properly to maintain its permanent ways. During the period of office of the Chifley Government, enemy prisoner-of-war labour was made available for the purpose of strengthening the Trans-Australian line, which has enabled the trains to De run at 70 miles an hour continuously without disturbance of the tracks. Recently, I read that thy line between Adelaide and Melbourne required extensive maintenance and repair because of the use of diesel locomotives on express trains to and from Adelaide. Unless the Commonwealth is prepared to assist the States, the State railways will become even worse than they are to-day. The States are unable to meet the expenditure involved in maintaining their railways in an efficient state. The Commonwealth has an obligation to keep the State railway systems in an efficient state, if only as a defence safeguard. Urgent consideration must be given to this problem.
The honorable member for Bendigo in a very thoughtful and reasonable speech, urged that a convention should be held to discuss constitutional matters. Such a proposal should receive the wholehearted support of the people. Without Commonwealth assistance Western Australia can do nothing to improve transport in the northern parts of the State. Although Queensland is not a claimant State, it is also unable to improve its transport system without Commonwealth assistance. A commission should be appointed to investigate the transport systems of both States, and to make recommendations as to the best means of improving their railways, roads and stock routes. Western Australia could provide an almost unlimited supply of foodstuffs if its transport systems were improved. The honorable member for Bendigo submitted a practical proposition which should be considered on non-party lines. ITo one should wish to score a political point in connexion with a matter of this kind. We should examine this matter dispassionately with the object of reliev ing .the States of a burden which (they .are no longer .able to carry. As .an old railwayman it appals me to see the efficiency of the Victorian railways being .sapped away because of the shortage of funds which results principally from the decision of this Government to increase interest rates on ^government loans. High interest rates will make increasingly difficult the carrying out of works in the future. By increasing the interest rate on public loans, the Government has done a disservice to the country. .Such a policy may serve the interests of the wealthy supporters of the Government but in the final result it will have a detrimental effect on Australia as a whole. I resent the suggestion that that policy should be continued.
In the period from 1939 to 1945. despite the huge volume of war-time traffic, the railways of South Australia incurred a loss of almost £4,389,718: those of Western Australia lost £1,944,570; and those of Tasmania lost £1,988,260. These figures are taken from various reports that are available to honorable members in the Parliamentary Library. I have been reading such documents lately, because I believe that one of our main problems at the present time is the loss incurred on our transport systems, which may be described as the lifeblood of the nation. Communication with remote areas which should be developed, should be established in the initial stages by civil aviation in order that people may travel rapidly and comfortably to those spots. Later, railways and roads should be built so as to provide for the products of those areas ready access to the markets in the more densely populated districts. If that process of development be followed, we shall achieve results. At present, we are not tackling the problem in that way.
The suggestions made by the honorable member for Bendigo deserve the serious consideration of the whole House from a non-party viewpoint. Let us adopt a national outlook on this matter. The honorable gentleman’s suggestions were most sensible. Other sensible suggestions could be made by honorable members on both sides of the chamber. I regret that many Government supporters appear to be uninterested in Commonwealth and State financial relations, and that their only concern appears to be to increase interest rates. I deplore such an attitude. When the Chifley Labour Government was in office, Australia enjoyed an era of cheap money, and valuable public works were undertaken. Since the Menzies Government has been in office, the public works programme has been limited by credit restrictions. The employment of many people on developmental works would not be disadvantageous to Australia. As a good Australian I believe that this country must adopt a policy of expansion. The Labour party is in favour of such a policy. One of the first steps to be taken in this respect is to arrange a conference between the Commonwealth and the States on transport problems, with a view to ascertaining whether the Commonwealth can relieve the States of some of their difficulties. I want an arrangement under which the States will have enough money for their requirements, and will not be compelled to approach the Commonwealth for special -grants. I plead with every honorable member to examine this matter from a national stand-point, and not as a member of the Labour party, the Liberal party or the Australian Country party. If this problem is considered on non-party lines, there is some hope of success. If the problem is considered on party lines there is no hope.
.- I listened with the interest which all honorable member’s accord the honorable member for Bendigo (Mr. Clarey) when, on behalf of the Opposition, he resumed the debate on this bill. I say, in fairness, that his speeches are invariably well prepared, that his material bears all the evidence of considerable research, and that he makes his points in a reasonable and logical manner. I regret that the debate has deteriorated somewhat from the high standard set by him. Whilst I concede those points in his favour, I am bound to point out that the theme of his speech did not differ from the general tenor of the speeches of his colleagues, although they were not delivered with the eloquence and did not contain the logic that we admire in the speeches of the honorable member for Bendigo.
The honorable gentleman considers that the finances of the States should bo subject to a permanent arrangement, and he has suggested that the Commonwealth should assume control of some of the major functions of the States, such as railways, health and education. He also believes that a constitution convention should be held on these matters at a convenient opportunity. But his speech indicated his acceptance of the gradual encroachment by the Commonwealth on the functions of the States, and the progressive transfer of power from the States to the Commonwealth. The honorable member for Werriwa (Mr. Whitlam), whose speeches on some other subjects have done his obvious ability little credit, followed the lead of the honorable member for Bendigo in this respect. He poses as the new spokesman for the Labour party. I regret that the position of leader of the Labour party is further complicated by the intrusion of the young gentleman from Werriwa. Honorable members who listened to his speech with the attention that his remarks deserve, will agree with me when I point out that he frequently used such expressions as “ We have done this “, and “ We propose to do that “. It was perfectly plain that the Labour party, for which he spoke, will use the uniform income tax system as a means of achieving political unification. Of course, unification has long been the policy of the Labour party.
– The honorable member for Werriwa would not need to be the leader of the Labour party in order to make such a statement.
– I listened attentively to the speech of the honorable member for Werriwa, and I am sure I have not misinterpreted his remarks. The subject of this debate is the payment to the States of a special financial assistance grant to supplement the amount payable under the formula embodied in the tax reimbursement legislation. I remind Opposition members that the uniform income tax legislation was introduced by the Curtin Labour Government in 1943’. I do not dispute the fact that this legislation was introduced as a war-time measure, and that, under those conditions, there was little opposition to it. But the fact that this legislation has been continued after the cessation of hostilities is quite another matter. The income tax legislation was amended after the war, and the basis of the formula was determined by the then Government, not in terms of theory but in terms of precise amounts.
I believe that I am entitled to remind the House that this legislation is a definite instrument for the achievement of unification, which the honorable member for “Werriwa has advocated. The present tendency is dangerous and alarming, and the three political parties represented in this chamber have a major difference of opinion about it.
One matter particularly disturbs me. The honorable member for “Werriwa has stated that the approach of Government supporters to this problem is somewhat inconsistent with their general remarks about the federal” system. The secondreading speech of the Treasurer (Sir Arthur Fadden) on this bill reveals some alarming tendencies. I refer particularly to such statements as “ the Commonwealth offered to make a supplementary grant” and “when the States failed to agree”. In my opinion, that kind of approach is wrong; but some honorable members on both sides of the chamber do not share my view. The division of opinion is sharply marked. One attitude is that the Commonwealth, which raises the money, is kind and generous to the States when it makes a portion of the proceeds available to them. The other approach is that the Commonwealth Parliament has been harsh, cruel and unjust to the States in the apportionment of the revenues. The point that I am making is that some honorable members on both sides of the House accept this theory of complete Commonwealth control, which is inconsistent with my understanding of the policy of the Liberal party and the Australian Country party on the maintenance of the federal partnership, and most definitely is inconsistent with the policy which, I believe, is in the interests of Australia. This theory of increased Commonwealth control disturbs me, and I deliberately direct attention to it.
The bill makes provision for the payment of a special grant of £419,000 to Victoria. This amount is in addition to the reimbursement which that State is entitled to receive under the formula in the uniform income tax legislation. The Acting Premier of Victoria, Mr. Galvin, who represented his State at the recent conferences of Commonwealth and State Ministers in Canberra, was able to satisfy the Commonwealth, after considerable argument, that Victoria was entitled to a larger amount than that calculated in accordance with the formula. In the same way, an additional grant of £40,000 is to be made to Tasmania. This tendency alarms me. The States receive reimbursements in accordance with a special formula, yet a decision was reached, in an almost star-chamber manner, to make special grants to Victoria and Tasmania. The people are unable to challenge such a decision. But the whole process is consistent with the opinions expressed by the honorable member for “Werriwa.
The honorable member for Maribyrnong (Mr. Drakeford) spoke about the railway systems of Australia with all the profound knowledge that he possesses of this subject. I do not dispute his proposed solution; I do not possess his knowledge of these matters to justify my doing so. I merely point out that the suggestion of the honorable gentleman is in conformity with the policy of the Labour party for an increase of Commonwealth powers. The honorable member for Maribyrnong has stated that the railway systems of each State show substantial losses over a period of years, and that the solution of this problem is to transfer State railways to the Commonwealth. I direct the attention of honorable members to the dangerous trend in that reasoning. Once again, the States are to be deprived of one of their functions. The tendency is always towards unification. Is that the solution? It could be claimed with equal justification, that a State was doing something wrong, and, therefore, the solution was to empower the Commonwealth to take over that function from the State.
Is that attitude logical, and is the suggestion the solution of the problem? If the attitude is logical, and if that is the only solution of the problem, I look forward without any pleasure to the prospects of development in Australia.
This country, with an area of 3,000,000 square miles; will not be adequately developed if all power and authority are centralized here. Canberra itself is so isolated, from the realities- of existence that the -very fact that, we deliberate here sometimes, disturbs me, and. I think that many other people are similarly disturbed. Many of us accept the view that the federal system of government, is best suited to the needs of Australia, but. the existing, financial relations between the Commonwealth and the States must be changed. It is impossible to reconcile State sovereignty with the present condition under which a State has to appeal to another government for the revenue tha t it spends. This financial irresponsibility, if I may so describe it without being misunderstood, has reduced almost every State to a condition that is alarming to any one who contemplates the future of government in Australia.,
The honorable member for Bendigo has suggested that a constitution convention be summoned to discuss Commonwealth and State relations and, if possible, make .proposals for overcoming difficulties. Sooner or later, the realities of the situation will have to be faced, but I doubt whether the problems can be solved if the Liberal party and the Australian Country party on the one hand, and. the Labour party on the other hand, bicker and fight over the details, and manoeuvre for political advantage. But if a convention can be arranged, it should include representation of the three levels of government - Commonwealth, State and municipal.
Under the present arrangement, the formula provides that the Victorian Government shall be compensated for any increase of population, but there is no provision that obliges it to adjust its payments .to local government bodies. Many new areas have been developed in Victoria since the present agreement, came into force, but the State Government has not recognized the needs of the municipalities where population has increased- considerably. The convention, if it is to be held, must be organized on a non-party basis, and municipalities must be given an opportunity to express their points of view and to secure justice. It is to the municipalities that the people look for the provision of the amenities which would make the difference between, the standard of living that we should like to have throughout Australia and the standard which most people, especially those, who live in the newly developed areas, actually enjoy. Although the municipalities are frequently neglected by State governments, those governments continue to scream indignantly that the Commonwealth does not provide them, with enough money. The honorable member for “Werriwa, who is partially adroit in the use of figures, referred to various amounts that the Commonwealth had paid to the States, but he did not give the complete figures. He mentioned an allocation of £20,000,000 in 1950 and another of £23,000,000 in 1953. Of course, total payments to the States amounted to £90,000,000 in 1950, and £143,000,000 in 1953. That sort of approach to the problem we have been discussing does not help those of us who are- seriously concerned to find an effective solution. Unless we can approach the matter honestly and discuss all the facts in. the open, there can be no hope of arriving at a solution other than that advocated by those who support complete unification and the centralization of power in Canberra.
– I. compliment the honorable member for Deakin (Mr. Davis) on the way in which he has stated his views on the relationship between the Commonwealth and the States. This is the sort of bill that brings, out the essential differences between the Government parties and the Opposition. The honorable member for Deakin has made it very clear that, in the opinion of Government supporters, this bill should never have come before the House.. He contends that the uniform tax system, under which the Commonwealth collects income tax and pays portion of the revenue to- the States, is bad in principle. That view is shared by many of his colleagues. In fact, wewere told twelve months ago that a bill like this would never be presented to the Parliament again. To my mind, the uniform tax system is the correct system for this country. If we want to be. a nation and have our views considered seriously by other nations, we must speak as a nation and not as an aggregation of individual States. Incidentally, there is uo need for the Government to persist with this system if it sincerely does not wish to do so. It commands a majority in each House of the Parliament, and if it wore convinced that the uniform tax system should be abolished, it could easily say to the States, “We will not collect any more taxes for you “.
This bill is merely a part of the uniform tax system. As a Labour man, I stand firmly for this method of tax collection and revenue distribution. That is a feature of Labour’s policy. I do not aspire to be the leader of the party and am not submitting my own views as party policy. Support of the uniform tax system is an integral part of Labour’s philosophy.
Why is it necessary for grants to the States to be increased year by year? We have been told that the formula upon which all parties to the uniform tax system agreed in 1946 provides for payments to the States this year amounting to £120,549,000. But this Government has agreed, to pay £142,000,000 to the States.
– Very generous !
– Furthermore, it has undertaken to provide about £500,000 extra for Victoria and about £60,000 extra for Tasmania. Why has it agreed to pay much more to the States than is provided by the formula?
– It has done so every year.
– That is so, but ithas never paid so much extra as it ‘proposes to pay this year. The honorable member said by interjection that the Government was very generous. I acknow-ledge that it has endeavoured to the best of its ability to he fair to the States, but I am not sure that it has been generous.
The States need the additional money because of the general economic condition of Australia to-day. The cost of operating a -State instrumentality, such as an education system, a railways service or a water supply system, has increased during the last twelve months and, therefore) the States must be provided with more money than they received last year. What is. the amount of the increase ? This Government contends that the States must bear their own responsibilities. I say that they cannot do so unless the Commonwealth provides them with sufficient funds. I ask honorable members to study education costs in the different States for 1951- 52 and 1952-53 and the estimated costs for the current year.. In every State there has been an enormous increase of costs. Every wage and salary rise adds to the financial difficulties of the States. Consider the situation of our railways systems. In all States efforts are being made to reduce the financial losses incurred by the railways. The New South Wales Government has arranged to import a large number of diesel-electric locomotives. The South Australian Government has done likewise. The Commonwealth railways organization has already imported diesel-electric locomotives for the eastwest line in an effort to establish that service on a paying basis. Victoria also is trying to effect economies. Both South Australia and Victoria have had to borrow money in order to buy new locomotives. Honorable members should realize that, whenever a State borrows money for expenditure on a business undertaking or instrumentality, the cost of conducting the undertaking concerned increases immediately by the amount of the annual interest bill .on the loan. The Department of Education in South Australia is doing a good job, and I give full credit to the State Government on that account. However, the costs of new schools and improved facilities must be met. The parents of the children will not pay the extra amount in school fees,, but the interest bill must be paid every year. The school councils, whose members are keenly interested in education, have asked the Commonwealth to contribute £100,000,000, or even £200,000,000, towards education costs in order to extricate State governments from their financial difficulties. However, up to the present, expenditure has been financed from loans and. the States have been saddled with additional interest charges.
The municipal tramways trust in South Australia, which was conducted by nonLabour men, began to lose money at such a rate that the State Government had to step in in order to reduce the collossal waste. A board was appointed by the Government to control the system and the State advanced £600,000 to it last year. It is reported that an additional £500,000 will be needed by the board this year. A member of the State Parliament told me recently that he had complained to a Minister that there was not enough parking space for motor cars in Adelaide and the Minister replied that he did not want to have any more parking space in the city because every car that entered the city area involved a reduction of tramways and railways revenue. That is a fact. The railways and tramways increased their fares in an effort to meet higher costs, with the result that people turned to other means of transport. The man who formerly was content to ride to work on a tram for a few pence now refuses to pay 8d. or 9d. each way. He finds it more economical to buy a bicycle. Some men also arrange for four or five friends to travel by motor car and share the cost of the petrol. Thus, although fares on our transport systems have been raised,income from them is still falling behind costs.
Motion (by Mr. Eric J. Harrison) put -
That the question be now put.
The House divided. (Mr. Speaker - Hon. Archie Cameron.)
Majority . . . . 11
Question so resolved in the affirmative.
Original question resolved in the affirmative.
Bill read a second time.
.- I shall not detain the committee for very long, but I want to say something about, not the substance, but the form of, clause 4, sub-clause (1.). I have read the subclause on several occasions, and no doubt other honorable members who are interested in this legislation have done likewise. I shall be very interested to hear whether any honorable member who has taken the trouble to read this subclause can extract an intelligible meaning from the language employed by the Parliamentary Draftsman. I submit that the sub-clause is a monument of obscurity. From time to time one hears members of the legal profession and other people whose business is to interpret or examine Commonwealth statutes criticize the tortuous language and the opaqueness that characterizes so much of the legislation passed by this Parliament. I hope that the Minister for Defence (Sir Philip McBride) will bring to the attention of the Treasurer (Sir Arthur Fadden) and the Parliamentary Draftsman the suggestion that it is about time that legislation presented to this House should be presented in a form and in language that is readily and easily apprehended. I shall not seek to delay the passage of the bill by moving that the sub-clause be withdrawn and redrafted. I hope Ministers and the Parliamentary Draftsman will ensure that in future we shall not be required to read bills almost ad infinitum before we can understand what they are intended to do.
– The bill, in the obscure manner to which the honorable member for Angas (Mr. Downer) has drawn attention, will increase by approximately £22,000,000 the sum payable to the States under the States Grants (Tax Reimbursement) Act. Euclid employed a method of proof known as reductio ad absurdum. He made a certain assumption and showed that, from the assumption, certain logical conclusions could be drawn which were unacceptable. Therefore, he concluded that the original assumption was wrong. That is something that we should bear in mind in dealing with this bill.
It requires us to take cognizance of the way in which the States spend their money. That flows logically from the nature of the bill, but it is something that should be unacceptable to this House. We do not want one parliament to consider the doings of another, but that is a logical consequence of the States grants system, under which the States are living on Commonwealth money. Therefore, applying the kind of reasoning that lies behind the Euclidian reductio ad absurdum, we can say that the States grants system itself is wrong. It is shown to be wrong by, among other things, the fact that it necessitates consideration by this Parliament of matters that properly belong to State parliaments. If this Parliament does not study such matters, it is probable that no other parliament will do so, because the States’ finances - this applies particularly to the Labour States, where the process of degeneration proceeds more rapidly - are rapidly reaching a state of chaos, because of the irresponsibility engendered by the States grants system. The system is breaking down gradually. If we do not review State expenditures in this Parliament, it is quite certain that they will not be carefully reviewed anywhere else, because the State parliaments - I refer particularly toNew South Wales, which is the State Parliament that I know best, although I have no doubt that the same kind of thing is happening in Queensland - have reached the stage where they do not care what they spend, do not care whether their administrations are efficient, and do not care whether they exhibit any probity. The financial irresponsibility engendered by the States grants system does not become apparent immediately ; the effect is cumulative.
The House is indebted to the honorable member for Werriwa (Mr. Whitlam) for saying quite clearly and distinctly that the policy of the Labour party is unification and the destruction of the States. It was, at least, a clear statement.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Sitting suspended from 5.58 to 8 p.m.
Bill presented by Mr. Townley, and read a first time.
– by leave - I move -
That thebill be now read a second time.
This bill will give effect to the Government’s decision to liberalize both the income and the property means test, and to increase age, invalid and widows’ pensions. The increases, and most of the alterations, have already been announced by the Treasurer (Sir Arthur Fadden) in his budget speech. Because of certain criticism, I am constrained to remind the House that this Government is the only government that has increased pensions in every budget that it has introduced. I also remind honorable members that in 1950 this Government increased pensions by 7s.6d. a week, and that increase was 50 per cent more than the largest increase ever given by any other government.
In 1951 this Government increased pensions by 10s. a week, which was an increase twice as large as any given by any previous government. Last year the increase waa 7s. 6d., again 50 per cent, higher than the largest increase granted by any other government. In addition, the free medical service and free medicine provided by this Government is worth about another 5s. each week to pensioners.
The Leader of the Opposition (Dr. Evatt), and certain other honorable members opposite, have pointed out that the proportion of the pension to the basic wage has fallen. Since this form of criticism may be entirely misleading, I shall comment on it briefly.
I have often said that I agree that quite a strong case could be made out to support an argument that pensioners should be paid some set proportion of the basic wage. Indeed, there are many good reasons to support such a proposal. But to argue that the pension is inadequate merely because at one time it was a certain percentage of the basic wage, and now is some other percentage, is one of the most fallacious of arguments.
At one time, the basic wage was determined for a family unit of a man, wife and three children. Then it became a little vague as to just what family unit it did refer to. One time it was for a 48-hour week, then for a 44-hour week and now for a 40-hour week. And, of course, in recent years its whole character has changed, and a new element has been injected into the deliberations of the court concerned with the basic wage - that is, the capacity of industry to pay - which is something quite apart from the cost of living. But, as I have said, to argue that the pension is inadequate because it was once some proportion of the fluctuating basic wage, and now is some other proportion, is quite pointless; because the very basis of the proportion has changed out of all recognition.
The Leader of the Opposition, and others, have mentioned the cost of living. Many have argued that the pension should be tied to the cost of living 0 series index. In 1940, the Menzies Government did tie the pension to the C series index, that is, to the cost of living. It remained so related until April, 1944, when legislation was introduced to free it again. But it is interesting to notice that, had the pension remained tied to the C series index, instead of being’ £3 10s., as it will be shortly, it would have been only £2 15s. 3d.
As for some of our ambitious young Labour friends who have insisted that this course be followed, I warn them that the legislation to remove pensions from the C series index was introduced by none other than the Leader of the Opposition himself.
Had this Government taken the pension of 42s. 6d., as paid by the Chifley Labour Government when it went out of office in 1949, as a basis, and applied all the variations in the price index number that have occurred since, the increase in this financial year would have been 9d. Moreover, had the Chifley Government remained in office there would have been no free doctor and no free medicine. However, I have said enough to indicate just how shallow has been the Opposition criticism up to now.
How many people really understand just what is involved in this increase from £3 7s. 6d. to £3 10s. a week? Let me give my first illustration. One hundred and twenty thousand people, it is estimated, will receive pension increases of more than 2s. 6d. a week; many will receive increases of 12s. 6d. a week, and some even more. They are the persons who now receive pensions at a reduced rate. If the reduction has been made because of earnings or other income, the. total increase may be 12s. 6d. for a single person, and 25s. for a married couple. Further, if the pension in such cases are also reduced on account of property, the increase could be as much as 18s. 3d. for a single person, widow or widower, and 36s. 6d. a week for a married couple.
These substantial increases in pensions are due to the fact that the Government is increasing the amount of permissible income which a pensioner may have without reduction of pension from 30s. to £2 a week or, in the case of a married couple where both are pensioners, from £3 to £4 a week. That will mean that a married couple will be able to have income, inclusive of pensions, up to £11 a week instead of £9 15s. as at present, while a single person will be able to have a total of £5 10s. a week instead of £4 17s. 6d. as, at present.
The Government is to be congratulated1 on having recognized that some special provision is needed for married couples where only one is qualified for a pension, because such couples have not hitherto been able to receive by way of income and pension the same total sum as a married couple where both husband and wife are pensioners. The bill provides, therefore, that a married couple, where only one is a pensioner, may have a total income of £5 a week without reduction of the pension. The couple will, therefore, be able to have an income of £5 a week, and one full pension of £3 10s., making a. total of £8 10s. a week. They may, however, have income in excess of £5 a week and receive a pension which would be reduced by half the excess income. The couple will not be permitted to receive by way of income and pension more than the amount of £11 a week which may be received by a couple where both husband and wife are pensioners.
This special liberalization, of permissible income for married couples where only one party is a. pensioner, will apply also to cases where the husband is an invalid, and the wife receives a wife’s allowance. Those persons will be able to have income of £5 a week in addition to the husband’s pension of £3 10s., and the wife’s allowance of £1 15s., making a total of £10 5s. a week. If they have any children under sixteen years they may receive additional income of 10s. a week in respect of each child without any reduction of the pension or the allowance. Thus, an invalid pensioner and his wife, with two children under sixteen years of age, will be able to have income of £6 a week in addition to the husband’s pension of £3 10s., the wife’s allowance of £1 15s. and a child’s allowance of lis. 6d. With child endowment of 15s., the total income will then become £12 Ils. 6d. a week.
The increases of permissible income to which I have referred, will particularly benefit pensioners receiving fixed incomes from other sources, such as superannuation. Briefly stated, a pensioner whose pension is now reduced by 10s. a week or more on account of superannuation or other income will receive an increase of 12s. 6d. a week in his pension. For married couples where both receive pen-
R.- F4l] sions, the total increase of pensions will be: 25s. a week; and where only one is receiving a pension the increase of pension will be 22s.. 6d. a week.
The following table gives a few ex: simples showing the extent to which pensions now reduced on account of income will be increased as a result of the increase of pension and permissible income : -
In addition to providing for increases in permissible income, the bill contains four important alterations of the property means test. First, the property exemption, that is, the amount which a pensioner may have without any reduction of pension, will be increased from £100 to £150. The increase of the exemption for a married couple will be from £200 to £300. Honorable members know, of course, that the value of a pensioner’s home, furniture and personal effects, is disregarded entirely whatever the value.
Secondly, the scale of progressive reductions of pension on account of the value of property above the exemption has been liberalized. At present, the reduction is £1 per annum for every complete £10’ of property above £100, up to £450, and £2 for- every complete £10 of property above £450, up to £1,000. No pension is payable if the value of the property, other than the home and so on, exceeds £1,000 or, for a married couple, £2,000. Under the bill, the scale of reduction will be £1 for every complete £10 of property above £150 up to £450, and £2. for every complete £11 of property above £450, up to’ £1,250. As an example, I may cite a case where a pensioner has property of £800 apart from his home. At present, he receives a pension of £70 10s. per annum. ‘ Under the new exemption and scale, he may receive a pension of £90 per annum.
Thirdly, the limit of property beyond which no pension can be paid is to be raised from £1,000 to £1,250. For a married couple the limit will rise from £2,000 to £2,500. Consequently, a married couple will not be debarred entirely from pension on account of property, unless the value of their property, apart from their home, furniture and personal effects, exceeds £2,500. I think that honorable members will agree that this is reasonably generous.
The fourth liberalization relates to reversionary interests. Under the property test, there is now a special exemption of £750 in respect of the present value of such interests. In law, a reversionary interest is regarded as property, but the Government recognizes that pensioners often experience considerable difficulty in realizing upon, or disposing of, such interests. In future, reversionary interests will be completely disregarded as property for pension purposes.
It is sometimes said that the means test penalizes thrift and savings, but. it is easy to over-state its effects in that direction. Many people who have been able to make moderate provision for their old age are not debarred from pension benefits. It will probably surprise many people to know that when this bill becomes law it will be possible for a married couple of pension age to have an income of £4 a week, money in the bank or other property to the value of £319, life insurance policies with a surrender value up to £750 for each party, and still receive full pensions totalling £7 a week. Thus, they may have a total income of £11 a week as well as the property I have mentioned, a home without limit as to value, furniture and personal effects, a free medical service and free pharmaceutical benefits. If their property, apart from their home, &c, exceeds £319 but does not exceed £2,500 in value, or if their income is between £4 and £11 per week, they may receive pensions at a reduced rate as well as the free medical service and free pharmaceutical benefits.
Widows’ pensions will also be increased. The maximum rate for a widow in class A, that is, a widow with one or more children under sixteen years, will become £3 15s. a week, and the rate for other classes of widows will become £2 17s. 6d. a week. The permissible income for all widow pensioners is being increased by 10s. a week; that is, from 30s. to £2 a week. Additional permissible income of 10s. a week is allowed in respect of each child under sixteen years. Thus a class A widow with two children will be able to have income of £3 a week and receive full pension of £3 15s. which, together with child endowment of 15s., will give her a total income of £7 10s. a week.
The bill also liberalizes the property means test for widow pensioners. At present, a class A widow is disqualified for pension if she owns property, apart from her home, furniture and personal effects, to a value exceeding £1,250. This limit is being raised to £1,500. All widows who become eligible for pension because of this extension of the limit may qualify for full pension because there is no scale of progressive reductions of a class A pension on account of property.
The property limit for other widow pensioners will also rise by £250, that is, from £1,000 to £1,250. At present the pensions of such widows are reduced by £1 per annum for every complete £10 of property above £100 up to £450, by £1 for every complete £7 of property above £450 up to £750, and by £2 for every complete £10 above £750 up to £1.000. Under the bill the exemption of £100 will rise to £150, and the scale of progressive reductions on account of property will be £1 for every complete £10 above £150 up to £450, and £1 for every complete £1 above £450 up to £1,250. Reversionary interests will also be disregarded entirely under the property means test for widows’ pensions.
As honorable members know, ceiling limits are imposed on the total amount which a person may receive by way of civil pension, plus war pension. They were first introduced in 1948. It has been customary in the past to raise the ceiling by the amount of either the civil or the war pension increase. It is proposed in this budget, however, to raise these limits to such an extent as will enable the pensioner to receive the full increase of civil pension, together with the full general increase of war pension, and a further increase of the civil pension up to half the increase in permissible income. For example, an age pensioner whose pension ie at present reduced by the ceiling limit, and who becomes entitled to an increase of his war pension, will be able to receive, in addition, an increase of his civil pension of 7s. 6d. a week, comprising the general increase, plus half the rise of 10s. in permissible income. This is the general principle on which the ceiling limits for age and invalid pensioners have been raised, but for the information of honorable members I shall now state the present and proposed new ceiling limits for each class of pensioner -
Before leaving this subject, I should like to make it clear that the ceiling limits of which I have been speaking apply only to Commonwealth payments to the pensioners concerned by way of civil pension, plus war pension. The pensioners can, of course, have additional income from any other source to bring their total re ceipts, inclusive of the pensions, up to the appropriate limit of income, plus pension.
Age and invalid pensioners who are inmates of benevolent homes will receive 24s. 6d. a week. The amount payable to the home for the pensioner’s maintenance will be £2 5s. 6d. a week. In keeping with our modern approach to social welfare, this measure substitutes the term “ benevolent home “ for “ benevolent asylum “ throughout the Social Services Consolidation Act.
Honorable senators will no doubt recall that, in its amending legislation last year, the Government provided a means test free pension of £3 a week for blind persons. Some of these pensioners have children under sixteen years, but they cannot receive a child’s allowance unless they are eligible for some pension under the means test for blind persons. This position is being rectified by the bill, and in future any blind pensioner who has a child under sixteen years of age will be entitled to receive a child’s allowance of lis. 6d. a week, in addition to the pension.
Under another amendment made last year, a new provision was introduced liberalizing the conditions under which occasional absences from Australia may be treated as residence in Australia for the purpose of satisfying the residential requirement for age pensions, which is twenty years’ continuous residence. Experience has shown, however, that this amendment did not entirely cover the. cases for which it was intended, and the provision is now being altered to give it a slightly wider effect and to make its meaning clearer.
Another amendment of a somewhat similar nature concerns invalid pensions. Where a claimant has become permanently incapacitated or permanently blind in Australia, or during a temporary absence from Australia, he needs only five years’ continuous residence in Australia to qualify for the pension, but in other cases twenty years’ residence in the aggregate is necessary. A child born to parents while they are temporarily absent from Australia may be permanently incapacitated or blind from birth, or may become permanently incapacitated or -blind before the .parents return to Australia. In .such a .case the child cannot be treated as having become permanently incapacitated or blind .during a temporary absence from Australia. This is obviously an .anomaly, and it is being corrected in the bill by a short amendment which will enable ,a child who became permanently incapacitated or blind in the circumstances which I have mentioned to be regarded as having become permanently incapacitated or blind in Australia.
Another amendment relates to funeral benefits which are paid in respect of the funeral expenses of age and invalid pensioners. At present a benefit received from a contributory funeral benefit fund may, if it is large enough, affect the amount of the Commonwealth payment. This, however, does not apply to the funeral benefit funds or friendly societies. The amendment will enable the funeral benefit funds of trade unions to be treated, for this purpose, in the same way .as those of friendly societies.
Under an amendment made last year, amounts received for hospital treatment from organizations registered under the Hospital Benefits Act were excluded from income, for the purposes of age, invalid and widows’ pensions and unemployment and sickness benefits, to the extent .to which they are required to meet hospital expenses over and above the amount of Commonwealth hospital benefits. It is proposed to give the .same exemption, under similar conditions, to amounts received by way of medical benefits from organizations registered in connexion with the .Commonwealth Government’s medical benefits scheme. The amount of the medical benefits payable by the Commonwealth will also be excluded from income. Hospital benefits and pharmaceutical benefits provided by the Commonwealth are already excluded. As all these benefits will be provided under the new National Health Service Act when it becomes law, appropriate amendments are being made in this bill to ensure the preservation of the exemption of all these benefits under the conditions I have indicated. ‘This will, of course, apply also to the free medical service and pharmaceutical ‘benefits received by pensioners. The increases and liberalizations pro- vided in , the “bill will operate from and including the first pension pay-day after it receives the Royal assent.
I have already explained that some 120,000 pensioners, out of a total of ±9.6,000, will receive an overall increase of considerably more than the basic 5s. a fortnight. In every one of these 120,000 cases the rate of pension will have .to be re-assessed. Naturally, this will take a little time, but already a great deal of work has been done., and in most cases the increases over and above the 5s. will be paid on the first pay-day after the bill becomes law. In the remaining cases, the work of re-assessing .the pensions will be completed as quickly as possible so that the additional increases will be paid in all cases at the earliest possible date. However, I want to make it clear to honorable members that in every case the additional increases due to the liberalizations of the means test will date back to the first pension pay-day after the bill becomes law.
The cost of the increases and liberalizations contained in the bill is estimated at £4,531,50.0 a year. The cost for this financial year will be £3,200,000. This will ‘bring Commonwealth expenditure under the Social Services Consolidation Act alone up to approximately £153,000,000 for the current financial year, and many social services provided, of course, are not included in this legislation. “When this figure is compared with £74,592,000 for the year 1948-49, the last full year during which the Chifley Government was in office, some idea will be gained of the extent to which this Government has liberalized these services. I direct the attention of honorable members to the fact that this Government, since it assumed office, has increased the rate of age and invalid pensions by almost 65 per cent, and the rate of widows’ pensions up to 58 per cent. Taking also into account the liberalizations now provided, the Government has increased the property limit by 67 per cent., the property exemption by ‘50 per cent, and the permissible income by 34 per cent, or more, -where there are dependent children. In addition, it has abolished the adequate maintenance provisions which formerly debarred many invalids under ‘21 years from receiving pensions, and it hasprovided a means test free pension for blind persons and granted othervaluable concessions. In the circumstances, the Government can justlyclaim to have remembered those members of the communitywho,because of age, infirmity orwidowhood,have not been able to participate directly in the increased prosperity which has been experienced during our term of office.
The Government is , proud of its record in the field of social welfare, particularly in view of the fact that its commitments in other directions have reached unprecedented levels. We have, at the same time, been able substantially to reduce taxation and thus ease the burden on the productive members of the community. I remind honorable members that social welfare involves community effort. The community must therefore meet the cost of the services which, through the Government, it provides.
One occasionally hears the complaint “I havepaid my income tax and social services contribution for years but have never received any social services benefit”. . I point outthat the portion of our taxes thatis allocated for social security purposes should be regarded asinsomewhat the same category as a premium paid to am insurance company. If we insure against accident, we do not expect the insurance companyto pay us unless we sufferan accident. Ifwe insureour homes against fire, we do not expect the insurance company to pay us unless our homes are burnt down. By the spreading of risks, however, the premiumsare kept very low. Taxation for social security purposes follows the same principle - that is to say, many pay taxes in the same way as insurance premiums, but benefits are payableonly in certain circumstances. If we have family responsibilities, we are assisted by child endowment and maternity allowances. If we are unfortunate enough to contract tuberculosis,generous allowances and medical treatment are provided. If we enter hospital, we receive hospital ‘benefits. If we find ourselves in need on account of age, invalidity or widowhood, we may receive pensions.
I doubt if one person in the land has not had somereturn from social services contributions. Even if ithere were,heor she has enjoyedthe security of the cover that hasexisted if it had been needed.
As the increased pension paymentsfor which the bill provides cannot be made until it becomes law, the Government seeks the co-operation of honorable members opposite to ensure that it is passed at the earliest possible date.
Debate (on motion by Mr. Allan Erases) adjourned.
Committee of Ways and Means:
Consideration resumed from the 10th September (vide page 157), on motion by Sir Arthur Fadden -
Interpretation. 1.. -(1.) That, in this Resolution - (vide page 150.)
Question resolved in the affirmative.
Standing Orders suspended ; resolution adopted.
That Mr. Eric J. Harrison and Mr. Francis do prepare and bring in a bill to carry out the foregoing resolution.
Bill presented by Mr. Eric J. Harrison, and read a first time.
– I move -
Thatthebillbe now reada second time.
May I suggest, Mr. Speaker, that for the convenience of the House this bill, which is a rates bill, and the Income Tax and Social Services Contribution Assessment Bill (No. 2), which appears on the noticepaper, be debated together ? . Such a course would facilitatethe debate, be much more convenient to members and enable the proceedings to be more readily under stood.
Mr.CALWELL. - The Opposition concurs in the proposal made by the VicePresident of the Executive Council(Mr. Eric J. Harrison) . We desire to debate the bills together, but want them to be submitted to, and disposed of by, the committee separately.
– The House will adopt the course suggested by the VicePresident of the Executive Council.
Debate (on motion by Mr. Calwell) adjourned.
Debate resumed from the 10th September (vide page 160), on motion by Sir Arthur Fadden -
That the bill be now read a second time.
.- Last year, when a similar bill was before the House, I had the honour to move an amendment to it on behalf of the Opposion. The amendment was couched in these terms -
That all words after “That” be left out. with a view to insert in lieu thereof the following words: - “the bill be redrafted to provide for -
It is now a matter of history that every honorable member of the Government parties voted against that amendment. Members of the Government parties at that time did not want greater reductions and concessions in relation to the subjects of taxation. They did not want a broader definition of the concession in respect of money paid or expended for educational purposes. They did not want a liberalization of the means test. They did not want an increase of the amount granted by way of deduction from assessable income in respect of the spouse and dependants of taxpayers. But twelve months have since passed and we are now that much nearer to a general election, and in the meantime the Government has ascertained that the Australian people want the very things that the Opposition demanded when legislation similar to this was before the House last year. So, the Government introduced a budget in which some of these matters are dealt with. The Opposition is still not satisfied with the reductions and concessions in relation to the subjects of taxation. It is not satisfied with the partial additional liberalization of the means test that has been announced. It is not satisfied with other provisions of this legislation. I propose to show just how fallacious are the arguments and how misleading is the propaganda of Government members, who try to coerce the people into believing that something very substantial is being given to them under this legislation and that the great majority of the Australian people will benefit from it.
When the Treasurer (Sir Arthur Fadden) introduced this measure on the 10th September last he tried to make it appear that the benefits conferred by it would have general application and that they represented a very considerable amount of money. The benefits conferred by the legislation will certainly be of assistance to some sections of the community, but not to those which need it most. We do not object to what is being done, but we contend that the benefits are to be conferred on the smaller and wealthier sections of the community, and that as far as the great majority of wage and salary earners are concerned they will not amount to very much. We do not, oppose the grant of taxation concessions, but we demand that income tax, whether it be imposed on individuals or on companies, shall be levied in accordance with the right canons of taxation, the first of them being that the burden of paying the tax shall be borne by those who are best able and not by those who are least able to bear it. The Opposition hopes to deal with the various concessions that the Government has announced which have a notional value in the case of individuals of £39,000,000 in this financial year, and in the case of companies of £23,000,000 in this financial year, or a total of £62,000,000. The Government would have the country believe that by reducing taxes in sight of the election of 1954 it is givingeffect to its pre-election promises of 1949 and 1951. Such a claim is demonstrably false because in granting the concessional benefits which this legislation will confer the Government is giving back to the Australian people only a portion of the taxes it imposed on them in its three years of office additional to the taxes that were in force when the Government parties faced the electors in 1949. The Government made certain concessions in the 1950-51 budget; but in the horror budget of 1951-52 - I assume that I am entitled to refer to it as such because that is the title which the Prime Minister gave it - the Government imposed ruinous rates of taxation in respect of both individuals and companies, and in respect of every other form of taxation, too. So, anything which was given back last year, and anything which is given back this year by way of a reduction of income tax on individuals and companies, still leaves Australians paying more in taxation generally, and more in income tax, than was paid under the last Chifley budget of 1949-50.
That important fact must be kept in mind. All this talk of generous deductions amounting to more than £60,000,000 has to be measured against the impositions of taxation which have been made over the last three years, and of which the present reduction is only an instalment of the conscience money variety. The Government is giving back this money, because it knows that it will not have much chance at the next general election unless it reduces taxation. It cannot be said that the Government really believes that taxes should be reduced. This is the Government which, a few years ago, said that in order to defeat inflation, we had to skim off surplus spending power, and increase taxation. But the higher taxation rose, the worse the inflation grew. High taxation only fed the flames of inflation. Now, on the eve of a general election, the Government has reversed its attitude completely, and got its economist to write an apologia for it this year. The Government now says, in effect, “ We no longer have inflation, and, therefore, we can reduce taxation”. Ask the average citizen whether he believes that inflation is not so bad now as it was a while ago. Ask the average citizen also whether he believes that high taxation is a cure for inflation. Of course it is not!
The amount of money which has been taken in taxation is greater, and the rates of taxation are still higher than they were in many respects under the Chifley Labour Government. The total amount of money which will be raised under this bill - the levy of income tax, social services contributions, and the like, on individuals and companies^ - will amount this year to £532,000,000. The total amount raised last year was £554’,000,000, or £22,000,000 more than is being raised this year. But whilst the amount of tax raised from companies will be £34,000,000 less than it was last year, receipts from income tax levied on individuals will increase from £387,000,000 to £398,000,000, or an additional £11,000,000. Those figures cannot be disputed, because they are published in the Treasurer’s budget statement for anybody to read. I am explaining them to the House, because it is necessary that the country should know that, despite this pretended reduction of taxation, individuals will pay in income tax £11,000,000 more this year than last year. The amount will probably be even higher-
– Tes, it is an underestimate of the receipts.
– Last year, the Government budgeted to take £383,000,000 in income tax. According to the budget papers, £387,000,000 was actually collected. So, with inflation still proceeding, the average wage and salary earner will pay at least £11,000,000 more, and perhaps £15,000,000 or £16,000,000 more, in taxation under a budget which, according to the Government, reduces his taxes. The main beneficiaries under this bill will be company shareholders, but great and all as this sum of £22,000,000 may seem, public companies with a taxable income of £5,000 a year or less are actually paying ls. in the £1 more in company tax under this budget than they paid under the last budget of the Chifley Government. So, the present Government, when it tells company shareholders that it is doing something for little companies and for shareholders generally, is guilty of deception. It is necessary that this fact be emphasized, so that small company shareholders will not be deluded. The little companies are stait weise, off,, despite this budget, than they were: under the. last budget presented i&g the, Chifley Government. Even the big; companies are,, in. many respects., no tetter oft than they were in 1949-50.
I remind the* House that this Govern. ment, promised during the general election campaign1, in 1949 to reduce taxation of all kinds. The. Government has not Honoured, that promise. Perhaps that is the- reason why the budget story has not had! the. favorable political reaction for which the Government had hoped. Perhaps the average worker realizes: that whatever benefit is given to him is. fractional or fictitional when compared with what he should be getting. The nearer has; income is to the basic wage, the. less favorable is his opinion, of the Government. Recently in the House;, the Prime Minister said that the Government had carried out 90 per cent, of the preelection promises that it- made in 1949. Its promise to reduce taxation was not one of those accomplishments. The present. Prime Minister declared on behalf of the Liberal party and the Aust. allan Country party in 1949 -
We. still believe that rates of taxation must be steadily reduced as national production and income rise and as economies are effected in administration.
What, the Prime Minister and the Treasurer actually did was to increase the* rates of. taxation as. national production and income rose. The Government is making, reductions of taxation now as a. sort, of death-bed repentance.
– It is clever tactics, but is another example of “ too little too late
– It may be clever tactics for a political party to make promises,, with the intention of breaking them subsequently, but broken promises pursue governments, and the present Government will find its nemesis awaiting it at the next general election.
This budget, is estimated to. raise £S.7;4,000,000 in taxation, and-‘ of that vast, sum of money, £532,000,000 will be levied under this bill. That, sum is: more than sis times as much as the. total minme of taxation imposed in 1939-40, the first year of. World. War II. Tt is nearly twice the amount raised in. income- tax in the last, year the Labour Government, was. in office,, and it is, £60,00.0^000 more than1 the total’. Commonwealth, taxa tion, revenue of all sorts, raised in: that financial year. Yet the present Prime Minister and the Treasurer said,, during the general election campaign, in 1949 that, taxation was too. high, and that it was, in fact £200,000,0.00 mora than it had been at the height of the war period.
The House and the country will be interested to know the. amounts1 of income tax: and social services; contribution levied in each of the last five financial years, and the: amount proposed, to. be levied during the present financial year. In 1948- 49i income tax on. companies and individuals, and the- social, services’ contribution, yielded £272,000,000. In 1949- 50 the receipts, were £279,000,000. The collections increased during the first year the present Government was in office to £451,000,000. The “horror” budget produced £551,000,000. The receipts last year were £554,000,000. The estimated collections for this year are £532,000,000. The Australian people are tired of heavy taxation; they want reduced taxation. They want a government that will reduce not only taxes but also expenditure. Th<? gravamen of the complaint of many taxpayers is that the Government, although it says that taxes are being reduced, is exploiting and trafficking in inflation for the purpose of yielding the same amount of money as was received last year.
We think, that this Government should do something for the basic wage-earner - the great mass of the people. The Government, certainly is not doing so under this legislation. I have been supplied with certain figures by the Commissioner of Taxation, and I find some interesting facts about the benefits that are to accrue to citizens in the various income groups. The persons in receipt of the basic wage1 or thereabouts receive a benefit’ of only £4,700,000. Persons in receipt of incomes, between £601 and £1,000 receive a benefit of £15,000,000. Persons in the income group £1,000: to £5,000 receive a- benefit- of £20,000,000, whilst persons in receipt’ of incomes in excess of £5,000 receive a- benefit of £13, 300,000”. Persons with incomes in excess- of £5,000 are1 not numerous, but they are to. receive’ three- times’ as much, as the 2,800,000 wage and salary earners, who constitute 80 per cent, of those engaged in production, and the vast majority of whom live on or near the basic wage. The sum of £4,700,000 is to be divided .among 2,800,000 wage and salary earners. Persons with incomes above the basic wage are to receive a benefit totalling £53,000,000.
Other figures supplied to me by the Commissioner of Taxation show the amounts of tax paid under the .budget of 1949-50, when the basic wage was £330 a year; under the budget of 1950-51, when the basic wage was £491 -a year; under the budget of 1951-52., when the basic wage was £590 a year; and under the budget of 1952-53, when the basic wage was £614 a year. I find that, whereas the basic wage earner without dependants paid £16 in tax in 1949, the .man on the basic wage without dependants pays £46 in taxation to-day. Yet, the Government says that taxation has been reduced. A man on the basic wage, without dependants, pays nearly three times as much in tax now as he paid in 1949. A basic wage earner with a dependent wife pays nearly four times as much in tax now as in 1949. The larger the number of his dependants, the worse his position becomes. A man with a dependent wife and one child pays six times as much in tax under this budget as he paid in 1949-50. A man on the basic wage with a dependent wife and two children pays ten’ times as much in tax to-day as he paid in the days of the Chifley Government. As a matter of fact, he paid 16s. in tax under the budget of 1949-50, and he will pay £14 6s. -under this budget. The figures have not been supplied by a Liberal party or n Labour party propagandist. This is not a fraudulent document. The figures have been supplied to me by the Commissioner of Taxation and ar.- authentic Let us see how this Government treats the basic wage earner this year -compared with last year. Tim basic wage this year is £614, and lost year was £590. What reductions does the basic wage earner receive? A man without dependants receives a benefit of £4 a year, or ls. 6d. a week, under thi? extraordinary “budget, which has. well been described “by many people as a fraudulent budget. A man with a dependent wife will ‘benefit by £5 12s. ‘from this budget which, according to the Government boasts, will relieve taxpayers by about £62,000,000 a year. A man with a wife and one child -will benefit by £4 6s. If te has two children, the benefit .will ‘be £3 4s. If he has three children, the -benefit will be £3 10s.
Opposition .Members. - A year?
– Yes, a year. If ,he has four children, the benefit will ‘be £1 12s.
Opposition Members. - A year?
– Yes. If he has five children, he will be rewarded with the magnificent reduction of 18s. in a year.
Opposition Members.. - In a whole year ‘?
– Order ! Interruptions are unnecessary. Prom my :experience, the honorable member far Melbourne is well able to put his case without assistance.
– By every criterion, this budget is of no advantage to -the 2,800,000 wage and salary earners ‘.who are living at or near the basic wage level. I have shown that, in relation to both :the reduction pf tax rates and the gross reductions in different categories, there is nothing in the budget to justify the Government’s claim that it is an incentive budget. Some of its provisions will be .of benefit to some people, but the Government makes a weak case for itself when it tries to persuade the people that, by increasing the allowance for a wife from £104 to £130 a year, it will make a major concession. That is of small importance. The extra concessions for dependants will be worth £5,550,000 in a budget of nearly £900,000,000. The Government can scarcely expect the people to rally around to pass votes of congratulation, confidence and approval as a result of these concessions.
I come now to the concession for children who .are receiving full-time education. The allowance is to be increased from £50 to £75 for each child. I do not object to that, but it is idle for the Government to try to convince the people that this will benefit the average .Antralian parent with children at school To the working man with a child attending a public school, a registered schooL or even a secondary school, the concession is not worth having. The only benefit that it confers will fall upon parents whose children attend boarding schools. It is futile for the Government to boast that it is helping students to purchase text-books, stationery and equipment. No child attending a primary school, or even a secondary school, is likely to spend £75 a year on such purchases. In any case, the concession is worth only £2,000,000 a year. We have been told that the Government will increase the allowance for medical expenses from £100 to £150, and the allowance for dental expenses from £20 to £30. But we find that these two concessions will deprive the Treasury of only £100,000. There is to be a concession in relation to income from mining, and the Opposition offers no objection to that because mining is essential to the development of Australia. The Government’s action in this instance is in line with the policy that has been adopted by all governments in Australia for many years past. In fact, if the concession were not granted, Kalgoorlie, the biggest mining centre in Australia, would have to close down. The Labour Government helped the mining industry considerably by its tax legislation.
The Opposition does not object to the proposed extension by five years of the period during which tax-free dividends may be distributed to shareholders in private companies. Neither does it object to the system under which graduated rates of income tax on abnormally high amounts of income will be spread over a number of years, because otherwise the recipients of the income would be liable to tax at unduly high rates. Incidentally, I remind the House that it was this Government that abolished the averaging system for all incomes over £4,000 a year under the horror budget. This deprived the woolgrowers of £45,000,000 in one year. These woolgrowers might not have saved the entire £45,000,000 if the averaging system had been maintained, but they would have saved a very considerable portion of it. Now the Government acknowledges belatedly the principle of the averaging system after it has done a great deal of harm to graziers and squatters as well as to the small wheat and wool growers. We do not object to the provision under which the royalties of authors and inventors will be treated as abnormal income. The benefit will amount to only £50,000 in one financial year, so this, too, is not a very considerable concession.
The bill might well have included a number of additional provisions in relation to income taxation and depreciation. The Government might have enabled many people who live at or near the basic wage level a greater exemption than it proposes. I have obtained some information on this subject from the Commissioner of Taxation, whom I have plied with requests during the last few weeks. He and his staff have been very helpful in supplying me with facts and figures. They have informed me that, if the basic wage were to be exempted for taxation purposes to the degree that it was exempt in 1949, the Treasury would be involved in a loss of £258,000,000. That sum, in my view, is a measure of the awful inflation which this Government has created and which has so greatly reduced the value of earnings and savings. It seems that the granting of any considerable benefits to persons li vine. at or near the basic wage level would be a costly business, involving perhaps £100,000,000. The basic wage to-day has reached the almost astronomical figure of £614 a year. It has been pegged at that rate, and it will probably remain unchanged for twelve months. The taxation officials have supplied me with other interesting information, which I shall not use at this stage because I do not want to cite figures all the time merely to expose the hopelessness of the Government’s position. Government supporters will have plenty of opportunities to explain why they are levying so much more taxation than the Labour Government levied, and why the man in receipt of the basic wage is to receive so little benefit and still will be required to pay much more this year than he paid in 1949-50.
The ghosts of the past have a habit of haunting politicians who make promises and false statements. I have here a clipping from a Sydney newspaper of the 29th August, 1946, in which the present Prime Minister, who was then the Leader of the Opposition, was reported to have said at a meeting at Warrnam- bool, in Victoria -
The Liberal party’s policy on taxation has made the Government think furiously. Employers and employees know that unless the level of taxation is reduced materially in the next year or two the development of Australia will be frustrated.
That was in 1946. Well, the Labour Government reduced taxation by 40 per cent, between 1946 and 1949. This Government promised to reduce it further, but instead of doing so it increased rates to the heights that I have indicated. The Prime Minister made the following announcement as recently as June last in a Liberal party publication : -
We shall make important and valuable tax reductions in the next budget. In doing so, we shall not act in a conservative or overcautious spirit. We shall, on the contrary, go as far as we can, or as any other responsible and honest Government could.
If the Government is unable to give a better deal to the Australian people than it proposes to give them, the reason is to be found in the difficulties that have been caused by the heavy rates of income taxation imposed on individuals and companies over the last few years. I seem to remember that one of the slogans of this Government a few years ago was, “ Give the Government a fair go “. It is time that the Government gave the taxpayers, both individuals and companies, a fair go.
Reference to company taxation brings me to the subject of the depreciation allowance. The Labour party believes that the 40 per cent, initial depreciation allowance should not have been terminated under the provisions of the 1951-52 budget. It was discontinued on the 30th June, 1951, although the Chifley Government had proposed that it should continue for a year longer. There are people in Australia to-day who say that employers do not need a higher depreciation allowance, but many employers say that, unless the allowance is increased, they will not be able to replace the plant that is wearing out in their factories.
– Is not the honorable member becoming a little confused?
– No. The Minister is full of confusion, which is his normal state. What I have said is that, unless manufacturers are granted an increased depreciation allowance, they will not be able to operate their industries as efficiently as they wish, and will not be able to increase the productivity of Australia as every one desires. The Labour party is interested in efficiency and productivity because it is interested in full employment. If the industries of Australia are forced to close ultimately - and many of them are closing now - there will be widespread unemployment, which is the last result that any political party wants to achieve. That is why we urge the Government to encourage the replacement of worn-out plant in factories and farms. If they will not do that, they must accept a large share of the responsibility for what happens to our economy. The Government may believe, because of the support it gets from certain sections of the press, that the people of Australia agree with what it is doing in the matter of tax reductions. I do not believe they do. The gallup poll gives a pretty fair indication of what the people think about that and other matters. I have read opinions, expressed by members of the great new Democratic party in Queensland, of the capacity of the Treasurer (Sir Arthur Padden) to handle taxation matters. Let me read what Mr. Wild, of Manly, said. I believe Manly is in the electorate of the honorable member for Mackellar (Mr. Wentworth). Mr. Wild said -
The Federal Treasurer, Sir Arthur Fadden, executed the most barefaced double-cross this country has suffered when he increased taxation. What is dead in the heart of the LiberalCountry party to-day is good old-fashioned honesty.
Mr.Failes. - What was his name?
- Mr. K Wild. Tax increases are the things that have made him wild. The Australian Financial Review, which is certainly not a Labour paper and with which the Labour party has not even a nodding acquaintance, had a good deal to say about this Government and its taxation proposals only a few months ago. In an editorial it said -
The Menzies-Fadden Government has an unfortunate taxation record, especially as its policy is to preserve and strengthen the free enterprise basis of our society. It appears to be helpless in the grip of the “ bureaucratic revolution “, for the Prime Minister himself has stated flatly that Federal expenditure cap not be reduced to any significant degree.
I think every member of the: Government parties agrees, with that, statement.If any of them do not agree, let them stand in their places later and be counted.. I want to quote two other opinions. They are the opinions of gentlemen who are certainly not members of the Labour party. I think one of them is, a Country party member of the New South Wales Legislative Council. He is Mr. O. McL.. Falkiner, the president of the New South. Wales Sheep Breeders Association. In the Australian Financial Review of the 30th July, he said -
Graziers’ main bugbear is the terrific burden of post-war taxation. It has had a damperlike effect on all primary industry, particularly grazing, and alone is responsible for the unfortunate attitude some men to-day are, adopting towards the important national problem of increasing production.
The president of the New South Wales; Wheat Growers Union, Mr. C. D. Renshaw, is reported by the same journal as saying -
Those who produce good’s and provide services are convinced that taxation is at altogether too high a level.
The Labour party has clean hands in regard to taxation. We have always supported low taxes. We reduced taxes from the time the war ended until we wentout of office. We wouldhave reduced them still further had we remained in office. Wehave opposed the principles of the bills dealing with taxation assessments which this Government has brought down in every year of its term of office. We regard the Treasurer in a friendly way, but we think he. is hopelessly wrong in matters of taxation. We regard him as a figure-happy Treasurer, and we do not think this country can stand figure-happy Treasurers or figurehappy government parties any longer. We want a government in Australia that will reduce both the volume and the rates of taxation, and leave money in the pockets of the Australian people for them to spend as they think fit for the supply of their own need’s and for the advancement and progress of Australia.
-One is entitled to judge the value of the criticism of this bill by the calibre of the critic. We must remember that the Labour party has shown itself to be a total failure as an administrator, and that in recent years it has shown that it is entirely devoid of policy: It hasno constructive policy. Therefore,I say that one should judge the value of the criticism by the calibre of the critic. Let us look at what honorable members opposite call their policy, about which’ we have, heard, so much. It is a policy of less taxation and more expenditure. It contradicts itself. It cannot be implemented. If we have less taxation, how can we have more expenditure? Money is needed to run the country. The honorable, member for Melbourne (Mr. Oalwell), made no endeavour in his speech to show how expenditure could be reduced. He made no reference to the fact that since the Menzies Government came intooffice expenditure on social services has been doubled. Does he, or any other member of the Opposition, suggest that any social services benefits should be cut down?. I wait for an answer to that question. Will any member of the Opposition suggest that the country should not be properly defended ? I hear no answer to that question. I am delighted that there has been no answer to it. AsI have said, a government cannot function properly without adequate funds. Therefore; we cannot have less taxation and more expenditure unless we issue unlimited treasury-bills. If we use the printing pressin that way, we shall have unbridled inflation in thiscountry. That is what the Labour party stands for. When the honorable member for Melbourne said’ that, under the policy of the Labour party, there would be more money in the pockets of the people, he forgot that a. part of the policy of his party was to issue unlimited treasury-bills, which could result only in more inflation and in much less real money in the pockets of the people.
Let me turn to the other branch of my criticism of the critic. I refer to the failure of the administration of the last Labour Government. The honorable member for Melbourne said that this Government had created inflation. Everyone in this House who has any knowledge of the matter knows that inflation existed under the last Labour Administration, and that no effort was made to check it. That is the reason why the Labour party was thrown out of office. In 1949, there were Labour days, and there were labour pains. The Labour government produced mis-shapen offspring in the form of shortages, bottlenecks and- blackouts. Itmade1 no attempt to stop inflation. Its last budget resulted in a deficit of £25,000,000. That was the state of Labour’s administration.
Then the Menzies Government came into office, charged with two main tasks, first, to stay inflation and stabilize the economy, and secondly, to reduce taxes. The honorable member for Melbourne admitted that the first thing the Menzies Government did w.as to proceed to reduce taxes. But then the difficulties of the economic situation became greater than ever before. That was not the fault of the Government. It was due to the unexpectedly large wool cheque, the cost of the Korean war and of necessary preparations for the defence of the country, and the unexpected increase of the basic wage by £1 a week. Inflation soared. The Government realized that the way in which it could stay inflation and ultimately stabilize the economy was to proceed to impose heavy taxes. It was aware that it was faced with the problem of dealing with inflation as well as the problem of reducing taxes. What was it to do? Was it to go on reducing taxes and allow inflation to grow apace, or was it to use the main weapon in the fight against inflation, and impose higher taxes? The Government was not afraid to take the right course. It imposed heavy taxes, but it imposed them on people with large incomes. The honorable member for Melbourne cited some figures to-night. He pointed out that the present decreases of taxes were not large in the case of persons with small incomes. I have no doubt that that is so, because we did not tax people with small incomes as severely as we taxed those with large incomes. We were not afraid to deal with people on high incomes, and we dealt with them drastically. As a result, the economy of the country now is very- different from what it was in 1951. There is no sign of unbridled- inflation, of national bankruptcy or- a depression.
Notwithstanding the budget of 1951, which I believe all sensible and thoughtful people should speak of- now as the stability budget, the Government’s’ troubles did not end. Immediately afterwards, we were faced with import dumping. Thereupon the Labour party predicted time and again that we were on the verge- of an economic crisis, that there must be a depression and’ mass unemployment, that the savings of the people were valueless, that there would be no Christmas shopping and so forth. But the Government won through, and the people showed their confidence- in ifr at the Senate election in December, when they returned the Government parties with a majority in that chamber. Notwithstanding severe difficulties, the Government managed to maintain employment at a much higher level than had been known before. I refer the House to the fact that in 1938, 8- per cent, of the work force was unemployed. That was regarded as a record level of employe ment- in those days, and a prosperity loading wa3 granted by the Commonwealth Arbitration Court. Some honorable members will recall that in 1945 the honorable member for Parkes (Mr. Haylen) said that if we could get unemployment down to 5 per cent, of the work for<-e, we should have full employment. Even in the worst period of last year, unemployment did not average more than 2- per cent, of the work force. It is very much lower than that how. The Minister for Labour and National Service (Mr. Holt) told the House recently that he was unable to meet the demands for unskilled labour. Having regard to all the difficulties that the Government has encountered, that is- an amazing position.
In addition, the Government has been able to maintain an unparalleled degree of industrial peace. As a result, our economy has become more stable. Last year, the Government found that it was able to reduce taxes once more. When it produced the stability budget of the previous year, it was aware that the increase of taxes then imposed was only a temporary measure and that before very long, when its economic policy had been justified, it would be able to reduce taxes again. Last year, income tax was out by 10 per cent; This- year, it will be reduced by 12$ per cent. Therefore, honorable members’ will’’ perceive that within two years the Government will have reduced the income tax by 22$ per cent: In addition to its income tax reductions, the
Government intends to give the public other valuable concessions. There will be a concession in respect of the wife’s allowance, and others in respect of educational expenses and medical and dental fees. Consequently, the 22£ per cent, reduction of income tax is not the whole story of income tax reductions, because the benefits of the additional concessions must be added to the benefit of that reduction. Moreover, the Government intends to make concessions in respect of a considerable number of other taxes. No wonder the budget has been described as a little man’s budget. I suggest that that is a very apt and true description.
Some attempt was made by the honorable member for Melbourne to throw dust in the eyes of the people by maintaining that the total income tax to be levied on individuals has been increased. “What he failed to tell honorable members and the people was that the national income has greatly increased. As the honorable member referred to conditions in 1938-39, let us investigate that period to ascertain what the true facts are. To-day, the national income is about five times as great as it was in 1938-39, and it is almost twice as much as it was in 1948-49. The national income is many times larger than it has ever been before in our history, and so it follows that because the people have more money they will pay more taxes, even though the rates have been reduced by 22^ per cent, in two years. Honorable members opposite have queried whether the workers will benefit under the Government’s financial proposals, but they have said nothing about the increase of the basic wage in recent years. It is well known that as the income increases the rates of taxation increase, but any one listening to the speech of the honorable member for Melbourne would have been persuaded that the honorable member had never heard of that simple proposition, because he expressed surprise that a man now earning £12 a week should be paying more than he paid . when he was earning £6 a week. The honorable member knows, perfectly well that the rate of taxation on £12 a week has always been considerably more than the rate on £6 a week, but the point is that a man who is paying somewhat higher taxes now than he paid when he was getting £6 a week has an additional £6 a week with which to pay his taxes. If we were to ask that man whether he would prefer to pay the old taxes and earn £6 a week, or whether he would prefer to pay the present taxes and earn £12 a week, he certainly would not ask to go back to the £6 a week.
– You ask him.
– I have asked him. The interjection that has been made by the honorable member for Watson (Mr. Curtin) is the sort of interjection that one would have expected from him. It came with the usual celerity and the usual valuelessness. A great deal was made by the honorable member for Melbourne about the fact that the taxes of certain people receiving low incomes will not be reduced by very much. He gave certain figures about that. The answer to that argument is obvious. If a man has benefited by only a small reduction of taxation and the total reduction of all taxes in two years has been 22J per cent., it is obvious that that person has been paying a very small tax indeed. Therefore, what is the value of the argument and illustration of the honorable member, for Melbourne? The truth of the matter is that in two years taxes have been reduced by 22^ per cent. But the honorable member did not mention that, nor did he mention the other very valuable concessions contemplated by the Government. Something has been said about people having less money because of the inflation of the currency. However, because of the national income, a person now has more money in his pocket than he had before, and I again refer honorable members to the illustration that I previously gave about the man who was earning £6 a week in 1939-40, but who now earns £12 a week.
It must be remembered that at one time the basic wage was based on the needs of a man and his family, but the wage is no longer so based, because the Commonwealth Court of Conciliation and Arbitration now works on the basis that the basic wage must be the amount which industry can afford to pay. Therefore, a man now gets far more than he needs. Consequently, any analogy between the present basic wage and the old basic wage falls by the wayside. Another matter that the honorable member for Melbourne was so very careful to say nothing about was that under the present taxation provisions, the special tax on property income will be abolished. Until the present time there have been two rates of tax, one on income from personal exertion and one on income from property. The property tax fell most heavily on those persons, and the majority of Australians fall within the class who have accumulated savings during their working lives, have invested them in a little property and are now dependent on the income from that property for their living. Many of those persons cannot obtain age pensions because of the means test. They were specially penalized by the property tax, but this Government, realizing their plight, has abolished the penalty tax, and I suggest to honorable members that by so doing it has made a magnificent step forward. Every elderly person who falls within the category that I have described will welcome this action by the Government. Moreover, this Government has provided that the elderly person who has income of up to £375 a year, or the elderly married couple with an income of up to £750 a year, shall be free from taxation. That again is a tremendous advantage to many elderly people. The Government has been at great pains to provide for the elderly people, who are the persons who have been most severely hit by inflation, and who, up to the present, have not been sufficiently considered by any government. Their incomes have remained steady while the incomes of the rest of the community have increased. But now this Government has given them an income tax concession which will place pounds in their pockets.
I turn now to company taxation. Tremendous concessions have been made by way of company taxation reductions, and it is idle for the honorable member for Melbourne to say that the Government should have given companies more concessions and should have made provision for initial depreciation. It is of no use for the Opposition to say that further concessions should be given, because after all any government must have a certain amount of money to carry on the business of the nation. The concessions that this Government intends to make to companies will be so great that we have been accused of bringing down a rich man’s budget. The truth of the matter is that the companies nowadays are owned by many small shareholders. Dozens of companies in this country have more than 10,000 shareholders, and many persons who have been able to save something because of the increase of the standard of living in this country, have invested their savings in company shares. At present most companies are controlled by small shareholders. The capitalism of to-day is very different from the capitalism of the last century. To-day the money is not in the hands of the few, it is in the hands of the many; and of the 3,500,000 persons who comprise our work force in this country it has been estimated that 500,000 of them own shares in companies. One-seventh of the workers are interested in companies, and they are the people who will get the benefit of the reductions of company taxation. The really important concessions with regard to company taxation will enable the companies to expand, produce more and employ more people than ever before.
I cannot understand the Opposition’s constant attacks on big companies. What is the alternative to the big company? By the nature of the attacks of honorable members opposite one is led to believe that their alternative to companies administering industry is that industry should be entirely socialized. If that is what they mean when they attack companies, all I can say is that the recent amendment of the Labour party’s constitution must be meaningless. Judging by remarks that honorable members opposite have made in this House from time to time, they are in truth and fact members of a completely socialist party. This Government, which believes in private enterprise, believes that companies should be able to operate in industry and that the small man who has small savings should be able to have a share in industry and a share in companies. This Government, by encouraging companies, is doing its best to provide employment. The tremendous concessions which have been complained about by honorable members opposite, will give the companies power to expand employment in this country, and we should therefore have no difficulty about maintaining employment at a level which has never been higher in our history. It has been asked whether the small man will get anything out of this budget. The greatest boon that he could get has been offered to him by the Government; that is security of employment. By providing that companies will be able to put their profits back into their businesses and give the maximum of employment this Government will give the worker greater security than he has ever enjoyed before. It has been well said that this is a little man’s budget.
Mr. THOMPSON (Port Adelaide)
I have before me a table which shows how the tax payable by a taxpayer with an income of £15,000 a year has been reduced since the Labour Government left office in 1949. Such a taxpayer paid in respect of his income for 1949-50 a tax of £9,282. Last financial year he paid £9,196. Last year, therefore, he had the benefit of a reduction of tax and so was not carrying a bigger share of the tax burden, as some honorable members opposite have implied. He paid tax of £9,733 in 1948, and the Labour Government reduced his tax liability for the succeeding year to £9,2S2, a reduc tion of £451, which represents 4.6 per cent. This Government has reduced his tax by £905 2s., or by 9.8 per cent. This is the kind of taxpayer who, according to honorable members opposite, is being taxed very heavily. Yet the Government has reduced the tax that he pays by twice as much as the Labour party reduced it at a time when it was desirable to reduce the tax payable by such taxpayers. The main difference in relation to tax policy between the Labour party and the Government is the method of spreading the burden of taxation. We have always held that taxation is necessary in order to provide the nation with means to carry on services, and I agree with the honorable member for Balaclava (Mr. Joske) that if the benefits made available to the community by the Government are to be increased, more revenue must be raised to pay for the increase. That is elementary. The point at which we and the Government part company is on how that extra revenue is to be obtained. It was an old principle of the Labour party that the basic-wage earner should not be taxed, because, when the Commonwealth Arbitration Court fixes the basic wage as a result of the movement upwards or downwards of the prices of certain commodities, it does not allow for any payment of tax by a basic wage earner with dependent wife and two children, as a charge against his income. The basic wage is intended tobe the bare wage to enable a man with a dependent wife and two children to live. The corollary of that principle is that the basic wage earner should not pay tax.
– The Labour Government did not remove from basic wageearners the liability to pay taxes.
– The Labour Government was anxious to remove theburden of tax from, such basic wageearner.
– But it did not do so.
– For the benefit of the honorable member for Isaacs (Mr. Haworth) I shall give the House someinformation about the tax payable by thebasic wage earner under the Labour Government, when the basic wage was about £336. I shall take for my example a taxpayer with a dependent wife and twochildren whose income was £350, or- slightly above the basic wage. He would pay £2 4a., when the present Government came into office. That was a relatively small .amount. A man who earned £300 a ;year paid no tax. The Labour party’s firm contention all along is that the man on the basic wage with a dependent wife and two children .should be exempt from tax. The basic wage at present is about £60.0 a year. It varies slightly in the different States, but that is ,a fair average figure. A taxpayer with a dependent wife and two children at present pays £13 ls. in tax.
– The honorable member is referring to taxable income, not to gross income.
– I am not referring to taxable .income. I shall take the trouble to educate the honorable member for Canning (Mr. Hamilton). We knowthat honorable members opposite think that members of the Opposition do not know anything. I shall disabuse them of that erroneous belief. I have worked out how that tax of £13 ls. is arrived at. A taxpayer with a dependent wife and two children, whose income is £600 a year, has the benefit of concessional allowances of £130 in respect of his wife, £78 in respect of the first child, and £52 for the second child,, which makes a total of £260, leaving £340 taxable income. On the first £100 of that taxable income he pays Ss. 4d., on the next £50 he pays 16s. 8d., on the next £50 £1 17s. 6d., on the next £50 £2 14s. 2d., on the next £50 £3 10s. 10d., and on the remaining £40 £3 14s. 4d., making a total of £13 0s. 10d., which is shown in the schedule as £13 ls. _ The honorable gentleman who stated by interjection that I was referring to the taxable income and not the gross income should not “be so ready to make such interjections unless he knows what he is talking about.
– The honorable gentleman .is probably quoting from the wrong document.
– I have taken the figures from a government document and they -work out correctly. The Labour party holds ‘tha;t taxes should .be levied, and concessional rebates should be allowed, progressively according to ability !to pay. If the nation needs £200,000,000 for defence or for any. other of the services that the Government renders to the community, that amount should he raised progressively from the people according to -their ability to pay. We contend that this Government is not following such <a policy. When the ‘Government came into office the concessional allowances were £104 for the taxpayer’s dependent wife, £;78 for the first child, and £52 for each of the other children. Last year I suggested that if the Government wished to be fair .and to make good its claim that it desired to help the family man, it was incumbent on it to do something for the family man. I suggested that the concessional allowance in respect of a dependent wife be increased to £156, and, in respect of dependent children, to £104 for the first child and £78 for each of the other children. I wished to know what that alteration would cost the revenue and I asked the honorable member for Melbourne to obtain the information for me from the Taxation Branch. He received from the Commissioner of Taxation a letter dated the 24th September, 1952, in which the commissioner said -
I acknowledge your letter of 21st August, 1952, in which you seek the cost to income tax revenue of increasing the present deduction for dependants as follows-: -
Dependent wife from £104 to £156.
First child from £78 to £102.
Other children from £52 to £78 each.
I have examined the proposal, and it is estimated that to increase the concessional allowances for dependants as suggested by you would cost the revenue not less than £15,000,000 a year.
The remission of that amount would be of great benefit to taxpayers with dependent families, who should be the object of tax relief. I made a statement last year, which I do not intend to repeat, about the effect of such an alteration on taxpayers in the different ranges of income. I have a similar short statement that I shall now give the House. I shall take as my example a taxpayer whose income is £500 a year. Such a taxpayer, with a dependent wife and two children, obtains the benefit of concessional allowances amounting to £260 in respect of his dependants, leaving his taxable income £240, on -which he “has to pay tax of £5 6s. If the increased concessions that I have suggested were made, his concessional allowances would total £338 instead of £260, and he would pay tax of £1 14s. That alteration would therefore go a considerable distance towards the complete removal of the tax burden from such a taxpayer. As I have said, the tax payable by a similar taxpayer on an income of £600 a year in respect of the current financial year will be £13 0s. lOd. The increase of concessional allowances I have suggested would reduce his tax liability to £6 14s., which represents a saving of £6 6s. lOd. I am disappointed that the Government did not adopt the suggestion I made last year for an increase of those concessional allowances. Instead, it has increased the concessional allowance in respect of a dependent wife from £104 to £130, which is half-way towards the mark that I suggested to it. Does not the Treasurer realize that the man with a dependent wife and no dependent children is not nearly so much in need of tax relief as i3 a man with a dependent wife and two children, the greatest concession is needed by taxpayers with children, but they will get only an extra £26 concessional allowance in respect of their wives, and nothing extra in respect of their children. If the concessional allowance in respect of a dependent wife was increased to meet the increased cost of living, surely the concessional allowances for children should have been similarly increased, because the cost of their upkeep has been similarly effected by increased costs. I suggest to the Government now, not as a proposal from a carping Opposition, but as a just proposal, that it should give some benefit’ to the people who need it. I point out that if my suggestion were adopted a taxpayer who earned £2,000 or £3.000 a year would obtain a greater benefit from an increase of concessional allowances than would a man on a low income, because he would save a.bout 6s. 8d. for every £1 by which his taxable income was reduced by the increased concessional allowances, whereas the man on the low income would save only about 13d. in the £1. I mention that to show that the adoption of my suggestion would not only help the man on the basic wage, but would also help people on the higher ranges of income. Everybody is entitled to benefit from any increase of concessional allowances. A man with dependent wife who pays the highest rate of tax of 10s. in the £1 would gain a benefit of £15 reduction of tax, whereas a man on the lower rate of tax of about 13d. in the £1 would gain only about 30s. or 32s. It is only a matter of equity that people on the low ranges of income who have dependants, should be helped as much as possible.
Another matter in .regard to which the Treasurer has not adopted an equitable policy is in relation to the assistance to aged taxpayers who were mentioned by the honorable member for Balaclava. Last year, the Government granted a concession to men over 65 years of age and to women over 60 years of age. This year, it proposes to liberalize the concession. A married man 65 years of age with a wife over 60 years of age may have an income of £750 a year without payment of tax. Contrast the position of such a married couple with that of a man 64 years of age, with a wife 59 years of age, who is working in industry and receives an income of £750 a year. Merely because there is a difference of one year in the respective ages of the husbands and wives the worker in industry will have to pay in income tax approximately £48, whereas the qualified aged married couple will escape scot free. The Labour party has always advocated the granting of income tax concessions on a graduated scale. In 1949, that principle was opposed by the present Treasurer when he suggested that the Labour Government should grant a flat rate reduction of 10 per cent, in income tax. Mr. Chifley refused to grant such a reduction on the ground that benefits should be conferred only upon those who most needed them. The proposals which he subsequently formulated made provision for reductions of up to 100 per cent, in lowest income groups.
The more I examine the budget the more I am convinced that it is far from the little man’s budget that Government supporters claim it to be. The honorable member for Balaclava, in an endeavour to prove that it is a little man’s budget, instanced the additional concessions that have been granted in relation to education expenses. He made much of the Government’s intention to increase the maximum deduction to £75. How many basic wage earners could afford to pay £75 for the education of each of their children? Not one of them could do so. The little men in the community will not benefit from that concession. I do not object to the raising of the maximum deduction to £75. It is right and proper that the Government should increase it to that amount, but I object to honorable members opposite using that concession to attempt to justify their claim that the Government is concerned about helping the little man. The benefit of the concession will be enjoyed only by taxpayers in the higher income brackets. I have had a great deal of conversation about this matter with a gentleman who has two clever daughters studying at the University of Adelaide. He wrote to the Treasurer and suggested that the deduction for education expenses should be increased. I have no doubt that he is feeling very proud of himself because he believes that his representations may have had some effect on the Treasurer’s decision to increase the concession. The point I wish to make is that I was prepared to do everything I could to help him, although I realized that the liberalization of the conditions and the increase of the deduction would not benefit the little men in the community who should be given first consideration in any tax remissions. The remission of a few shillings a week in income tax means more to a basic wage worker with a wife and two or three children than would a remission of £2 a week to the wealthier members of the community.
The honorable member for Balaclava said that the Labour party should be judged on its record. That remark prompts me to reply that the Labour party is pledged to look after the interests of the ordinary people in the community as far as it is practicable to do so, having regard to its obligation to do justice to all . members of the community. The burden of taxation must be equitably applied. The honorable member for Balaclava asked how the Leader of the Opposition (Dr. Evatt) would finance his suggested budgetary reforms, and claimed that in considering income tax remissions regard must be paid to the national income. I agree that the national income must be taken into consideration, but I contend that the overriding principle should be .that taxes shall be levied in the main upon those who obtain the largest share of the national income. A person who obtains a large share of the national income is better able to afford to pay taxes than is the man who receives a small share of it.
The honorable member for Melbourne (Mr. Calwell) has reminded us that no effective reduction of personal income taxation will be made this year because, whereas the revenue derived from income tax on individuals last year was £387,000,000, the anticipated revenue for the current financial year is £398,000,000, or an increase of £11,000,000. If business is so prosperous, if every person in the community is so much better off than he used to be and if the earnings of companies are higher, does the Government really believe that it can justify a reduction of company tax? Is it suggested that companies are making less profit than they formerly made ? Are not the companies sharing in the added wealth of the community? In spite of the large profits made by wealthy companies - I do not intend to cite specific figures - the Government proposes to reduce company tax from £167,000,000 last year to £133,000,000 this year. The Government contends that the unemployment situation has vastly improved and that companies are crying out for more and more employees. Why then should the Government decide to reduce company tax?
Another factor that must be borne in mind is that the reduction of company tax by approximately £33,000,000 will apply to income earned not this year but last year. The individual taxpayer is taxed on his current year’s income, but the tax imposed on a company relates to the income of the previous year. The handsome reduction of company tax proposed in this measure will enable the big companies to make a very handsome present to- their shareholders in the form of increased dividends. The Government cannot justify its decision to increase the total amount collected from individuals and to reduce the total amount collected f rom companies. The bulk of the revenue derived from company tax is paid by large and influential concerns.Companies which are struggling pay very little if anything in income tax. The Labour party stands firmly for the rights of the man on the bottom rung of the social ladder - the basic-wage worker. It contends that the basic-wage worker should be exempt from income tax. It refuses to accept the proposition advanced by the Government that cost of living adjustments have so increased the basic wage that the basic-wage worker is now receiving a sufficiently large income to justify payment of income tax. I can readily understand that a skilled tradesman who receives a margin for skill above the basic wage should pay income tax. Indeed, such a person paid income tax under the Labour Administration because he received more than was necessary to maintain himself and his family. To such a person the Labour Government said, in effect, “ You must pay a portion of what is necessary to administer the affairs of the country”.
– Order ! The honorable member’s time has expired.
.- To-night the honorable member for Melbourne (Mr. Calwell), who is the Deputy Leader of the Opposition, played a characteristic role. While he was speaking I mentally likened him to a ship weathering a severe storm in the Bay of Biscay, a ship which had lost its rudder and propeller and was completely helpless. He tried to place the Government on the defensive. I cannot think that any person could believe that a government which introduced proposals which will save the people income tax amounting to £60,750,000 in a full year, and nearly £40,000,000: in the current year, and which has granted a remission of tax to companies amounting to £28,750,000 in a full year and £23,300,000 this year, is in any circumstances required to be on the defensive. Honorable members on this side of the House will not need to be on the defensive in relation to this measure. They, and a very considerable number of persons outside the House, congratulate the Treasurer (Sir Arthur Fadden) for having introduced the measure. The right honorable gentleman who was villified two years ago is now the object of praise. No taxation proposals in recent years have given greater satisfaction to the community than have the present; proposals. There cannot be the slightest doubt that the proposals embodied in this legislation will be a tremendous incentive to thepeople.
The honorable member for Melbourne and the honorable member for Port Adelaide (Mr. Thompson), have claimed that the policy of the Labour party has always been that taxation should be based on ability to pay; that is to say, the person who can best afford to pay taxation should pay it. It is interesting to recall that the last budget presented by the Chifley Labour Government provided for reductions of taxation.. I shall refer to them briefly. The reduction of tax on an income of £350 per annum amounted- to the large sum of £1.11s. On an income of £600 per annum the reduction was £12 6s., and on an income, of £1,500 the reduction was £67. 15s. How can. the Labour party logically assert that a person in receipt of a small income should receive a much greater reduction of tax than a person in receipt of a large income? It. is impossible to produce a basis of income tax payments under which a person in receipt of a small income will get a larger reduction of tax than a person in receipt of a high income.
Opposition members have also dealt at length with total collections of income tax. They point out that the Treasurer (Sir Arthur Fadden) estimates that the collections of tax this year will amount to £398,000,000, compared with £387,000,000 last year, and they claim that no effective reduction of taxation has been made. The explanation of the higher yield from lower rates of tax is not difficult to discover. The number of taxpayers has increased substantially during the last few years. At the 30th June; 1949,. the number of taxpayers was2,831,418. At the 30th June, 1953, the number was 3,470,000. Hence the number of taxpayers has increased: by approximately 640,000, in the last four years. The level of earnings has also increasedduring the same period. When those factors are taken- into account, it is seen to be only, natural that collections of tax should increase, although: the rates have beenreduced. 1! shall now deal with various aspects of this income tax legislation. The suggestion that ‘the average reduction, of taxation is 12£ per cent… is, to a large degree, misleading, particularly in relation to smaller incomes. The amount of the reduction on all incomes less than £3,000 per annum, if the taxpayer has a dependent wife and two children, is in excess of 12-jV per cent. The reduction on. low incomes is. 100 per cent. Other reductions are as follows: -
That table shows clearly that the Government’s’ first consideration has been, for the persons in receipt of small incomes. I had a conversation with a working man a few days after the Treasurer (Sir Arthur Fadden) has presented his budget to the Parliament. The honorable member for Port Adelaide has endeavoured to convey the impression that the only people with whom he mixes are the working class. He says to Government supporters : “ The only people you mix with are those in the higher income groups “. Talk of that kind is ridiculous. The working man with whom I was speaking is a basic wage earner, and he said to me, “ There has been a reduction of taxation “. I replied1, “ Yes. What do you get?” He answered., “:I get back 3s. 6d. a week. Previously, I had been paying 17 s. a week”. It is ridiculous for the honorable member for Port Adelaide to claim that a tax reduction of 3s. 6d. a week means little or nothing to a man in receipt of the basic wage. Persons in the lower income groups are appreciative of the reductions, that have been granted by the Government.
I should like to make- a comparison between taxes’ payable on the same incomes, in Australia,, New Zealand and. the United Kingdom, In each instance the. taxpayer has a dependent wife and two children. The- comparison is as follows : -
On a rough calculation, the taxation in New Zealand is 150 per cent, higher than taxation- in Australia.- on some incomes. The table shows that taxation in Australia compares more than favorably with taxation in the United Kingdom and New Zealand;
It is also interesting to examine the residue of income after income tax. has been paid., The honorable member for Port Adelaide has referred to the basicwage earner, and I shall follow his example. The basic wage in 1949-50 was £338 per annum, and the tax payable thereon was £1 7s., leaving a residue of spending money of £336 13s. At present, the basic wage is approximately £614, the- tax payable thereon is- £14 6s., leaving a residue of £599- 14s. That is to- say, the basic-wage earner at the present time has- £263 ls. more to spend after his tax ha3 been paid than had the basic-wage earner under the Chifley Labour Government. However, not many people earn as little as the basic wage and, therefore, I shall make a comparison based on average wages. The average wage in 1949-50 was £4’82, and the tax payable thereon was £12 4s. a year, leaving a residue of £469 16s. The average wage to-day is £795, and the tax payable- thereon is £35, leaving- a. residue of £760.. So a person in receipt of the average wage to-day has £290 4s. more for spending than had a person- on the average wage in 1949-50. Let us now relate the rate of tax applicable in 1949-50 to an income of £614, which is approximately the basic wage at the present, time. The taxpayer on that income paid £28 4s. in 1949-50:, but this’ year he will pay only £14 6s., a reduction of £13 18s.
Opposition members make the mistake of presupposing that every person spends every penny that remains after he- has paid, his’ tax. 1 have never heard more fallacious reasoning. Personal savings, including investments and savings in life assurance policies in Australia, amounted to no less a sum than £536,000,000 last year. The national income was approximately £3,600,000,000, so that £1 in every £7 which were earned has been saved by the people. What becomes of those savings? They are not buried in tins, or at least a big percentage of them are not treated in that way. This is the money which becomes available for investment in the community. It is the money which is subscribed to Commonwealth loans, invested in industry, or retained in savings bank deposits. If Opposition members consider that there is not a great deal of money in the savings banks, I hasten to assure them that the average deposit in the savings banks in Queensland at the 30th June last was no less a sum than £88. Savings are available for investment in industry, so that industry may be expanded.
I believe that it is desirable, in a debate of this kind, to point out to the House and the people the value of investment for the establishment of new industries, and the extension of existing industries. Opposition members should be particularly interested in this matter, because investment of this kind creates more employment. When more employment is created, the production of goods should increase. When the production of goods is increased, a contribution is made to raising living standards for every man, woman and child in the community. These facts should be made known. Such improvements will be made possible by the tax reductions for which this legislation provides.
I refer now to the increased concessional allowance for a spouse, a dependent father or mother, a daughter keeping house for a widowed father, or a housekeeper having the care of children under sixteen years of age. The allowance will be increased from £104 to £130 in each instance. This will be of considerable assistance to persons in the lower income groups. If we also take into account the increase of the allowance for medical, dental and optical expenses from £100 to £150, we must concede that this Government has shown in no uncertain manner its interest in the welfare of the least influential members of the community.
The education allowance will be raised from £50 to £75. I refer to this matter because the honorable member for Port Adelaide asked how the basic wageearner could afford to pay for the education of his children. I know of many people whose income is only a little over the basic wage level but who have managed to educate their children to university degree standard. I pay tribute to them for their sacrifices, but it is ridiculous for the honorable member to suggest that it is impossible for people near the basic wage level to incur expense for the education of their children. Had he taken the trouble to examine the provision, he would realize that, although the £50 allowance that applied last year referred solely to payments made to schools, this year the £75 allowance will be inclusive of all educational expenses. I admit that the allowance last year probably applied only to parents whose children attended boarding schools, but this year the new allowance will apply to school fees, the cost of board and accommodation and many other expenses. In Queensland there are many people who find it necessary to send their children away from home in order to obtain secondary education at places like Rockhampton and Brisbane. Even though these children may attend State secondary schools, the parents have to provide the cost of board and accommodation. The allowance will cover fares, and I point out that many people who live within 20 miles of a capital city are required to pay for the transport of their children to and from school. The allowance will also cover the purchase of text-books. Some honorable members may think in terms of free education in their home States, but in Queensland every parent of a school child is called upon to spend considerable sums for the purchase of textbooks. Therefore, this liberalization of the education allowance will be of considerable benefit, especially to parents who have two or three children of school age. The cost of stationery and general equipment, which includes pencils, erasers and so forth, also will be covered by the allowance.
Another feature of this measure is the provision for a new concession in relation to extraordinary income earned by authors, artists, composers and inventors. In the past, abnormally large amounts received by such persons have been taxed in full in the year in which they have been received, although the taxpayer concerned may have worked for as long as five years in writing a book or perfecting an invention in order to earn the money. In such circumstances, it is not fair that the full amount should be treated as income for taxation purposes in the year in which it is received. The new provision is that the normal income of a taxpayer, plus only one-third of the additional amount, shall be treated as income for the purposes of taxation in the .year when the extra amount is received. Another important provision, for which the Government is to be commended, will abolish the special tax rate on property income. One might reasonably ask, “ What is property income and what is personal exertion income?” I have had a fairly close association with the administration of the taxation law over a long period and t know that there is very little difference in some instances. If a person is an investor, surely it requires a great deal of personal effort on his part to make investments over a period of years. However, a person engaged in business usually has invested capital, or property, in that business in order to produce an income. Why should that income be regarded as personal exertion income? Some of it must be a return on the capital that has been invested. Therefore, I submit that, if we analyse the facts carefully, we find that there is a personal exertion element in relation to the earning of property income and a property element in relation to much of the income that is treated as personal exertion income. This bill will considerably simplify the assessing and checking of assessments by taxpayers. This Government has consistently endeavoured to make it possible for the ordinary taxpayer to check his assessments without being obliged to appeal to the taxation Branch or purchase a special book on tax rates. The proposed alteration of the law will make it easier for persons who have earned income from property to check their assessments.
I direct my attention now to company taxation. As I said earlier, the total value of the concession that is to be given to companies in a full year under this bill will be just under £30,000,000. The rates paid by public companies up to the present have been 7s. in £1 on the first £5,000 of income, and 9s. in £1 on the balance. These rates will be reduced to 6s. and 7s. in £1, respectively. This is a very commendable proposal. The rates paid by private companies hitherto have been 5s. in £1 on the first £5,000, and 7s. in £l on the balance. These are to be reduced to 4s. and 6s. in £1, respectively. The new rates will apply to income that was earned by companies last year. Honorable members should realize that most of the big companies in Australia have been short of working capital for a considerable period. The reduction of the company tax rates under this bill will be of considerable assistance to them in providing essential working capital. The Labour party, of course, suggests that companies are Frankenstein monsters which, in all circumstances, should be mulcted of the last possible penny. We on this side of the House strongly disagree with that view. Mem’bers of the Opposition have said that the reduction of company tax rates will enable companies to retain extra money for their own purposes or to increase dividends paid to shareholders. No suggestion could he more stupid than that. A company, when all is said and done, includes in the prices charged for its goods a proportion of money to cover its taxation expenses. Therefore, if taxation is reduced, it is highly probable that prices will be reduced. If they are not reduced by the desire of companies to pass on the benefit of the reductions to their customers, then competition will achieve the same result. As I have said, price reductions may lead to the achievement of higher living standards for the community as a whole. Therefore, the Government deserves to be commended for its decision to reduce company tax rates. We must never forget that, under the present tax system, the company is taxed first and the shareholder is taxed later on the dividends that he receives from the company.
I refer now to the retention income of private companies. Last year the
Government removed the retention allowance from private companies which received their income from ‘property sources. Many companies own city properties and their only income is the rents from those properties. Up to the present, it baa been necessary for 100 per cent, of the profits earned by such companies to be distributed in order to avoid payment of a special rate of tax. Under this legislation, such companies will be allowed to retain 10 per cent, of their income without becoming subject to the special rate. Many professional men are interested in such companies. In Macquarie-s’tree’t, in Sydney, and in Wickham-terrace, in Brisbane, groups of doctors have formed themselves into companies for the purpose of acquiring professional rooms. Usually they pay up only a small amount of capital in relation to the total value of their property and hope that they will be able to pay off the balance out of the net income. The new provision will at least give them the opportunity to reduce their mortgages. I end on the note on which I began by offering my congratulations to the Treasurer and the Government on thislegislation.
Mr. BEAZLEY (Fremantle) [10.43 j. - The honorable member for Petrie (Mr. Hulme) made comparisons between taxation rates in Australia, New Zealand and the United Kingdom. There is a long history attached to such comparisons between the three countries, and also a long history of press dishonesty and party dishonesty in this matter. The press a year ago, when the Treasurer (.Sir Arthur Fadden) presented a much less popular budget than his budget for 1953-54, directed the attention of the right honor able gentleman to the fact that greater tax reductions were proposed in New Zealand than in Australia. The Treasurer defended himself by saying that much less taxation was paid in Australia than was paid in New Zealand. The newspapers which were attacking the Treasurer, notably the newspapers of Sydney, gave very little publicity to his defence. The right honorable gentleman had little right to complain about the lack of publicity because he himself, when in opposition, made no acknowledgement of an exactly similar comparison of tax rates ‘that ‘had been made by the Treasurer of the day, Mr. Chifley. The fact ‘that This country -was placed ‘on a much ‘lower -taxation basis than either the United Kingdom or New Zealand was due to several factors. The United Kingdom has always borne a much greater share of imperial defence expenditure than Australia has ever borne. When there were Labour governments’ in both countries, the high rate of taxation in the United Kingdom was always represented as a socialist plot, but now there is a Conservative government there, implementing an enormous defence programme, it is no longer so represented. Apart from that factor, the reason why Australia pays much less taxation than New Zealand or the United Kingdom is that the late Treasurer, Mr. Chifley, placed the country on a much lower basis of taxation than either of those countries. The proportions quoted by the honorable member for Petrie (Mr. Hulme) .were as true in the days of Mr. Chifley’s treasurership as they are now.
The honorable member has pointed out, quite correctly, that reductions of income tax do not greatly benefit people in the lower income groups. If a man pays only £2 a year in income tax, the greatest benefit he can be given by a reduction of income tax is £2 a year, which is not very much. That is why the Labour party has always taken the view, which the honorable mombai’ for Petrie, by implication, has endorsed, that a government can help people in the lower income groups most by a reduction, not of direct taxes, but of indirect taxes. If honorable members will look at the Commonwealth Fear-Booh, they will see that in Mr. Chifley’s long period of office as Treasurer, the weight of taxation, expressed in percentages of the total tax collections, was always thrown more heavily on direct taxes and less heavily on indirect taxes than is favoured by the parties opposite I cannot traverse the whole field of indirect taxation, but I should like to say that I feel sufficient consideration has never been given to the ‘question of howfar sales tax reduces income tax returns. I believe that if sales tax were abolished, there would be a large Increase in income tax returns, because money hitherto paid in sales tax would, with lower prices as a result of the abolition of sales, tax, go into some people’s incomes and increase income tax returns.
The title of the bill shows a kind of nostalgia for an idea that has been popular in Australia. I refer to. the idea of a contributory scheme. The bill is entitled, the Income Tax and Social ServicesContribution Assessment Bill. I direct the attention of the Blouse to; the policy speech delivered by the Prime Minister (Mr. Menzies) in1949, in the; course of which he said-
Australia still needs a contributory system: of, national insurance, against sickness, widowhood, unemployment, and old age. It is only under such a system that we can make all. benefits a matter of, right, and so get completelyrid of the means test .. . . Without an all-round contributory system, there are enormous, financial barriers to an immediate abolition of the means test.
The right honorable gentleman promised to establish a committee, to inquire into the difficult problem of establishing a contributory scheme. Mr. Chifley had some such; idea. That is, why he abstracted from general taxation - a step that was politically unpopular - the social services contribution He changed the existing system, under which the contribution was paid at a graduated rate to a kind of compromise system, under which a flat rate was reached muchearlier than under the ordinary system of graduated taxation. He did so in the hope of working gradually towards a contributory scheme. But both Mr. Chifley and the present Prime Minister found thattheidea of introducing a contributory scheme foundered on the rock of reality. It is about time the idea was abolished from our thinking because of itsunworkability.
I propose to discuss whether, at this point of Australian history, we could bring in a contributory scheme. It cannot be doubted that the present Prime Minister was sincerely attached to the idea of such a scheme, because, when he was Attorney-General in the Lyons Ministry in 1938, he resigned when the national insurance scheme, a contributory, scheme of that Government, was not brought into effect. Had the scheme been brought into effect in 1938, it would have been knocked to pieces by the tremendous inflation that occurred in Australia after. 1938.Obviously, rates of contribution fixed in 19 38 would be totally unread now, and people receiving benefits under the scheme would have to be paid large supplementary allowances obtained from taxation. That,however,isanticipating one of the difficulties of a contributory scheme.
The Primes Minister advanced the moral argument in favour of a contributory scheme when he said in his policy speech that if we adopted the concept of a contributory fund, in which contributors had an equity as of right, that would provide a method of abolishing the means test. That is the moral basis for arguments in favour of a contributoryscheme, but if such a scheme were introduced to-morrow, the whole of the existing body of age pensioners would have no equity in the fund. If we introduced a scheme under which young people contributed to a fund upon which they could draw when they were old and at the same time paid the pensions of existing old people from taxes, or if we had a scheme under which existing age pensioners drew ona fund to which only young people were contributing, we should not have a contributory scheme in. the true sense of the term. As we have more than 400,000 age pensioners who have not contributed’ to a contributory scheme, it would be very difficult to. introduce such a scheme at this point in. our history.
There are some illusions about contributory schemes that are constantly brought up when the matter is discussed. One of the illusions is that, somehow or other, a. contributory scheme is immune from a slump, or is more immune from a slump, than one financed from taxation.. That illusion is based on the idea that if a fund is established,, it can be drawn upon if a slump occurs. In. the reports that led up to the contributory scheme of 1938, that fallacy was exploded. If a. slump occurs and the unemployment rate is high, people cannot contribute to the fund. That is what happened to the National Insurance Fund in Great Britain during the depression. Another objection to a contributory scheme is the difficulty of adjusting it to meet variations of the cost of living. When I was in the Education Department of Western Australia in 1938. I contributed to the superannuation and family benefits scheme. My contributions were based on an anticipated pension of £3 a week. I think the age pension then was 17s. 6d. a week. So the pension I expected to get was greatly superior to the age pension of that date. But now the age pension is in excess of the £3 a week for which I contributed in 1938. The superannuation scheme in Western Australia, in common with similar schemes elsewhere, has had to be supplemented from taxation. There is a persistent illusion about contributory schemes and a refusal to face the fact that, without being supplemented from taxation, they are unable to face one of the greatest difficulties of the twentieth century - a constant deterioration of the purchasing power of money. Under the present system, pensions are paid from taxes taken from the current national income at the current purchasing power of money, and can be adjusted readily to meet variations of the cost of living, in the way that the Government is making some kind of adjustment at the present time. The difficulty of devising a contributory scheme that will meet variations of the cost of living must be faced.
Another important point that arises is how far an ordinary contributory scheme evades the principle of graduated taxation. A scheme could be based on ‘a flat rate contribution, as is done in New Zealand. The rate might rise to 2s. in the £1. A man with an income of £5,000 a year would pay 5,000 2s., and a man on £500 a year would pay 500 2s. But that is not a graduated tax system. If the social services scheme is financed by a graduated system which starts with low rates of taxes and rises to high rates, it will operate in the direction of increasing the purchasing power of persons in the lower ranges of income and reducing that of persons in the higher ranges of income. A flat rate basis works against that. Then, there could be the straightout insurance scheme under which, regardless of income, contributors pay the same premium for the same benefit. That sort of scheme, of course, is designed to evade the idea of taxation as a means of redistributing income; and the Australian Labour party has always opposed it.
I believe that the best method of financing social services is by taxation, and I believe that social services contributions, like all other revenue, should be graduated in the same way as income tax is graduated as .a part of the general taxation structure. That is a sound approach, even from a business viewpoint. If the purchasing power of the lower income groups is increased, persons in those groups must expend their additional purchasing power immediately. The lower one’s income, the more one needs to expend it, because one is nearer to a needs basis. When purchasing power is shifted towards the lower income groups, the velocity of circulation of money is increased and business turnover is increased. I believe that that was one way in which full employment was maintained in Australia when the Chifley Government was in office during the difficult period of the demobilization of the armed forces and the period of adjustment after World War II. The demobilization of 1,000,000 persons at that time without causing unemployment was a great achievement. The explanation of that achievement was, in part, the determination of Mr. Chifley to stick to the direct taxation method and the graduation of taxation, and the formulation of social services in such a way that they would tend to shift purchasing power downwards towards the lower income groups. The important point made by the honorable member for Petrie, which he advanced in defence of the Government’s action, but which, I believe, was an attack on it, was that reductions of direct taxation confer very little benefit on the lower income groups. That is the vital criticism, of the budget which made great concessions in direct taxes and failed to make great concessions in indirect taxation, such as sales tax.
.- The bills now before the House are to give effect to the tax concessions proposed in the budget. One would have thought that as this budget has been presented as a means of saving this Government and rallying the people to its support, Government supporters in this chamber would have shown more readiness to expound its principles and to discuss at length the so-called benefits that the Government proposes to give to the taxpayers. But of the 67 members of the Government parties in this chamber only two have taken the opportunity of this debate to defend the Government’s taxation proposals. Of course, those honorable members realize in their hearts that the budget is socially unjust, because the Government does not propose to distribute taxation concessions fairly among the various sections of the community. Those honorable members also realize that economically and financially these proposals are unsound because the proposed reductions of sales tax are to be confined largely to luxury and unessential items.
– Order! I ask the honorable member to address himself to the question before the Chair.
– The Government’s taxation proposals must be considered in relation to its two previous budgets which it brought down in 1951 and 1952. As a background to these measures, it is well to recall that in 1951 the Government, in spite of the explicit promises that it made to the people during the general election campaigns in 1949 and 1951, savagely increased the rates of both direct and indirect taxes. It imposed a levy at the rate of 10 per cent, on taxes payable by individuals and companies, and it savagely increased indirect taxes. It raised the rates of sales tax to the unprecedented level of 66$ per cent. Honorable members should bear those facts in mind when considering the reductions to which these measures will give effect. Whilst I admit that reductions are being made, the fact remains that, in many instances, they will simply restore the position that existed before the Government increased taxes in 1951. Another fact that should be borne in mind is that the Treasurer (Sir Arthur Fadden) has been trading on inflation. Although rates of taxes are to be reduced, the actual yield of taxes during the current year will equal approximately the yield obtained from this source last year. As the national income has increased, the Treasurer will be able to maintain approximately the same yield on the reduced rates. It is significant that despite the proposed reductions of the rates of taxes, the actual yield from taxes payable by individuals will be £11,000,000 more than was the yield from this source last year. Whereas those collections last year totalled £387,000,000, it is estimated that this year they will total £398,000,000. It is significant that, at the same time, whilst collections of company tax last year totalled £167,000,000, collections from that source this year are estimated to total only £134,000,000, a reduction of £33,000,000. The real significance of this budget lies in the sphere of company tax in which both the rates and the total yield will be substantially reduced.
It might be well to consider some of the fundamental principles of company taxation. I do not desire to traverse the ground that the honorable member for Melbourne (Mr. Calwell) covered. That honorable gentleman very forcibly pointed out that the reduction of the rates of tax will not give very much relief to persons in the lower income groups. He cited figures which conclusively demonstrated that fact.
At least one sound principle has been established in respect to the taxation of public companies. During the war years public companies had to pay heavy taxation. They paid a primary tax, a super tax and an undistributed profits tax. Those various classes of taxes caused considerable administrative problems, great difficulty in working out assessments, and made companies uncertain of their final liability. Moreover, there were complicated systems of rebates, and usually a long time elapsed before the total liability was assessed. It is a good reform to dispose of all these types of taxes, and it is satisfactory to note that there will now be one unified tax applied to public companies. The work of the Commissioner of Taxation and the companies will now be greatly simplified, because the companies will know where they stand.
The position is not quite so simple with regard to private companies. They pay a primary rate of tax and also have to pay an undistributed profits tax. However, the principle which operates in the case of private companies is the correct one, and the application of an undistributed ..profits -tax cannot be avoided if equity in the administration of the taxation law is to prevail. In the case .of a private company, a family concern .or one with a .small number of shareholders, it would be wrong if the primary tax only were imposed and the balance of the money that would otherwise be taken by the Commissioner of Taxation were retained by the company. If that should happen the company would be paying taxes at a lower rate than if the business were carried on by an individual. After the primary rate of taxation has been imposed, there .are retention allowances, and to compel the private companies to distribute the balance of their profits to shareholders so that the shareholders will have to pay tax on ‘those profits, there is an undistributed profits tax at the penal rate of 10s. in the £1. The system of taxation is complicated, but it cannot be made simpler if -the principles of equity and justice are to be preserved.
Public companies have .received the greatest concessions given in .this budget. The rate of taxation of profits of more t’han £5,000 ha3 been reduced from 9s. in the £1 to 7s. in the £1, which is a reduction of 22 per cent., and the rate of taxation on the first £5,000 of profit has been reduced from 7s. in the £1 to 6s. in t’he £1. Public companies will profit considerably from that substantial reduction. Tt ‘is worth pointing out that private and public companies are in an advantageous position in the payment of taxes compared wilh individuals or private traders. The taxation concessions allowed by the Government’s financial policy apply to money already in the hands of .the companies, because the concessions date back to the beginning of f.he last financial .year. Consider ‘General Motors-Holden’s limited, which has been mentioned in this debate. As the result of the reduction of tax rates, that company will gain -about £894,000.. That represents taxes on money earned to the 80th June this year, and it had already been set aside by the company. That money ‘will now be retained by the company. Although ‘individual wage and salary earners pay their ‘taxes from week to week, and although private traders, farmers ‘and business people pay taxes on the ‘current .year’s .income, public companies and private companies pay their taxes on their previous year’s income. Therefore, they have the .benefit for up to twelve months of the use of money that rightfully /belongs to the Crown.
– What has the honorable member to say about money in the hands of .shareholders .being taxed twice?
– That matter may he worth considering. I do not know whether the honorable member is suggesting that money in the hands of shareholders is taxed twice. These big taxation concessions will put a lot of money that otherwise would have been paid in taxation last year into the hands of the shareholders. Also, because of the abolition of the additional tax on property income, the shareholders will receive a further concession on the dividends in their hands. Again, the shareholders will receive the benefit of lower rates of personal taxation. .Consequently, the person who receives income from dividends will benefit in three directions. There will be much more money ultimately in the hands of the shareholders. Tie honorable member for Corangamite ;(Mr. Mackinnon.) seemed to .suggest that the money in the hands of the .shareholders will be taxed twice because the companies will have paid tax on it. -and the ^shareholders will be required to pay tax .on the dividends <they receive. Does he suggest .that the dividends in the hands of the .shareholders ,should not be taxed? I ido not know whether the Government parties are suggesting that there .is ,a double taxation .of .dividends in .the hands of shareholders, because if they are it would .be interesting to hear :a .member of .the Government say so. This question was investigated at length by the .Commonwealth Committee on Taxation. That committee consisted of -specialists in taxation, .and it examined this matter in some ‘detail. I think that it might be worthwhile for me .to direct ‘the attention of honorable members Ito the ‘.conclusions of “the .committee. I am sure that they will then see that it would be ;un thinkable, in this country, to even consider not ‘taxing dividends in the hands of shareholders. It would .be unthinkable if we regarded dividends that shareholders receive as not being liable totaxation.
– That has happened in the United Kingdom.
– Does the honorable member for Mitchell (Mr. Wheeler) suggest that that system should be applied in Australia?
– Order! The honor able member is not entitled to ask a question of another honorable member. He must addressme.
– I apologize, Mr. Speaker, for asking a question. I realize that I was out of order, butI noticed when I asked thequestion that there was a stony silence on the other side. The honorable member for Mitchell did not attempt to answer my question. The Committee on Taxation pointed out in its report that prior to 1940 a rebate was allowed to an individual shareholder in respect of the tax that had been paid by the company on the profits that it earned, and certain interests in this country, some of which apparently are supported by the honorable members opposite, are pressing for the reintroduction of the system of allowing a rebate in respect of the dividends in the hands of shareholders, tax on which has been paid by the company. For example, the Taxpayers’ Bulletin, the official organ of the Taxpayers Association, make statements along those lines, and it represents that the general system of taxing shareholders with out regard to the tax that has been already paid by the company is unjust. The committee pointed out, very properly in my opinion, that if this proposal were given effect to, so that dividends in the hands of shareholders would be exempt from taxationbecause tax had been already paid by the company, there would have to be a considerable increase of the current rates of taxation imposed on other groups of taxpayers. There would have to be an increase all round in order to make up for the considerable loss of revenue that would accrue as a result. The committee quoted an illustration which showed that many people in receipt of large incomes from dividends would be relieved from paying any tax at all if thisremarkable proposal was given effect to. It quoted an example of an unmarried taxpayer in receipt of incomeof £1,500 a year from dividends only, who would not pay any tax at all, whereas another taxpayer in receipt of a similar income from salary would,at the rates then applying, pay tax of £281 13s., whilst a taxpayer in. receipt of similar income from interest on government loans would pay tax of £195.That proposal would establish a privileged section of taxpayers, those receiving income from dividends, who would be exempt from taxation - a truly remarkable state of affairs which, in my opinion, could not be countenanced. The report also pointed out that if thatproposal was given effect to the market, prices of shares would increase considerably, and this would have an adverse effect on competing forms of investment. Debentures and government loans would suffer accordingly, becausethere would be little money available for investment in those spheres. I think that we shall not hear very much about that proposal in this Parliament in the years ahead. Indeed, I will be astounded if we hear any more about it.
There has been a remarkable lack of consideration for the family man in the budget. In to-night’s edition of the Melbourne Herald, there is an article entitled The Liberal Voice, written by a spokesman for the Liberal party, which suggests that one of the achievements of the Government is the recognition that has been given to the family man. It states that many worthwhile concessions have been made in that respect. I remem - ber before the budget was introduced-
– Order ! The honorable member is not entitled to continue to discuss the budget. It was dealt with in committee, and therefore it cannot now be dealt with by the House. The honorable member should confine his remarks to the bill.
– I was merely making a passing reference to the budget, Mr. Speaker, and I accept your ruling. I remember some time ago there was a lot of publicity in the press about the great concessions that were to be made to the family man in proposals that the Government would introduce. These proposals are now before us, and when we examine the benefits that the family man has received “we find that the allowance for a dependent wife has been increased from £104 to £130. The allowance for medical expenses has been increased from £100 to £150, which includes an allowance for dental expenses of £30 that has been increased from £20. Both of those allowances are worthwhile concessions. Also, the concessional deduction for educational expenses has been increased from £50 to £75 in respect of each child attending school, and the conditions under which that allowance is payable have been extended. Those are the only three benefits that have been given to the family man. I entirely support the proposition that was advanced by the honorable member for Port Adelaide (Mr. Thompson) that the concessional deductions for children in a family should have been increased. It is rather remarkable that the Government has increased the concessional allowance for a wife even though the amount of the increase is inadequate, but has not increased the concessional deductions for children. These concessional deductions were introduced three years ago, when the present amounts were fixed. In the intervening period of time there has been a considerable amount of inflation. Prices, and the cost of living have risen considerably. Yet the amounts of concessional allowances for children still remain the same. They are still pegged at the amounts that were decided three years ago. I suggest that the Government is showing a lack of a sense of responsibility to the families of this country in not making adequate recognition of the needs of a family by increasing the concessional deductions for children.
I wish now to direct the attention of honorable members to the failure of the Government in these measures to give any concession to the home-owner. This matter also vitally affects the family man. If the Government was really sincere in its. protestations that it desires to help the family man and encourage home ownership, it had a good opportunity to do so in the measures now before us which give effect to its taxation concessions. It should have introduced a new concessional deduction into our taxation laws to provide that the interest which is paid upon the mortgage of a person who is buying a home should be a concessional deduction for income tax purposes. It is a well-established principle, and a well-known fact, that a businessman who borrows money on overdraft is allowed to claim the interest that he pays on his overdraft as a deductible item for income tax purposes. Big companies and corporations have adopted the practice of borrowing large amounts of money by issuing debentures. In other words, they really raise capital in that way, and the interest that they pay on the debentures is a deductible item for income tax purposes. It is included on the expenditure side of the balance-sheet of a company before theprofit is arrived at. If itis good enough for a businessman to be able to claim the interest that he pays on overdraft as a deductible item and for the big company which issues debentures to claim the interest paid on those debentures as a deductible item, it should be good enough also for the man who is buying his own home to be able to claim as a deductible item the interest that he pays on his mortgage. I repeat that if the Government were really sincere in its protestations that it desires to help the family man and that it is anxious to help the home owner and encourage people to own their own homes, it has neglected to adopt a practical means by which it could have given effect to those protestations. It could have granted that concession to the home purchaser and the family man to whom it would have been of considerable benefit, but it has done nothing in that respect.
I wish now to direct the attention of the House to another inadequacy of this measure. Section 78 of the Income Tax and Social Services Contribution. Assessment Act sets out the institutions and bodies to which gifts made are allowable deductions for income tax purposes. They include public hospitals and benevolent institutions. The bill provides for a further extension of this principle to include the Queen Elizabeth the Second Coronation Trust Fund for Mothers and Children. I consider that the principle should be extended further to include gifts to educational institutions, including schools, colleges, and bodies connected with them, such as parents and citizens associations and other committees attached to local schools. It is interesting to note that the section provides that gifts to certain types of educational bodies shall be allowable deductions. Those bodies include public universities, residential educational institutions affiliated with universities or established by the Commonwealth, a university college, which is an institution, association or organization and approved research institute, and where the gift is for the purpose of scientific research. These restricted provisions were drawn up many years ago when education was regarded as essentially a State matter.
– Order ! The honorable gentleman’s time has expired.
Debate (on motion by Mr. Leslie) adjourned.
Motion (by Mr. Kent Hughes) proposed -
That the House do now adjourn.
.- The Minister for Territories (Mr. Hasluck) in his statement this morning opened wider the issue that is involved in his tenancy of a cottage-
Motion (by Mr. Eric J. Harbison) put -
That the question be now put.
The House divided. (Mr. Speaker - Hon. Archie Cameron.)
Majority . . . . 18
Question so resolved in the affirmative.
Original question resolved in the affirmative.
The following papers were pre sented : -
Public Service Act - Appointments - Department -
Repatriation - T. A. O’Donnell.
Supply - T. F. C. Lawrence, F. F. McKnight, J. V. Ramsay, L. H. Winter.
House adjourned at 11.36 p.m.
The following answers to questions were circulated: -
z asked the Minister for Civil Aviation, upon notice -
– The answer to the honorable member’s questions is as follows : -
It was proposed to acquire land additional to that already owned by the Commonwealth at Toowoomba so that an area adequate for the development of an airport would be available. Approval for the purchase of this land was given on an estimate of £27,000 supplied to the Department of Civil Aviation at the time, and this information was given to a conference held in Toowoomba on the 7th April last. Since then, however, the Department of Civil Aviation has been informed that the cost of acquisition of the land will be in the vicinity of £50,000, that is almost double the original estimate. I regret to say that .the funds available will not .permit acquisition of this land at this price during the present, financial year.
r asked the Trea-surer, upon notice -
– The answers to the honorable member’s questions are as follows : -
d asked the PostmasterGeneral, upon notice - 1 When did he receive the report of the Australian Broadcasting Control Board with respect to> its. inquiry into the use: of imparted, radio: transmissions?.
– The answers to the honorable, member’s’ questions, are as follows-: - 1% The Australian- Broadcasting Control Board submitted a report to me on the 25th August, 1952, which related not only .to the use of imported radio transcriptions, but also to’ a number of other subjects affecting the employment of Australian- artists’ and musicians concerning which representations had been made to the Government by various, organizations.
Trade with. Russia.
n asked the Treasurer, upon notice -
– The answers to the honorable member’s questions are as follows : -
2 and 3. The balance of trade over this period of seven years was in Australia’s favour to the extent of £33,977,000 (Australian).
d asked the Minister for Air, upon notice -
– The answers to the honorable member’s questions are as follows : -
The benefits which will accrue both to the Australian nation and the Royal Australian Air Force are considerable and cannot be assessed in financial terms. World-wide publicity has already been gained for Australia as the result of the Royal Australian Air Force entry and preparation for the race. Particular benefits may be summarized as follows: -
The Royal Australian Air Force has regarded the entry in the race as an operation exercise - requiring an acceleration of the normal training and research programme always associated with the introduction of new aircraft into the service. Personnel have been specially trained and subjected to operational discipline throughout the pre-race period. During the course of the race the participating crews and the ground staffs located at the various refuelling points will gain additional experience, the results of which will prove invaluable in connexion with Royal Australian Air Force planning.
Cite as: Australia, House of Representatives, Debates, 8 October 1953, viewed 22 October 2017, <http://historichansard.net/hofreps/1953/19531008_reps_20_hor1/>.