22nd Parliament · 1st Session
– I have to inform the House of the unavoidable absence of Mr. Speaker. In accordance with Standing Order 13, the Chairman of Committees, as Deputy Speaker, will take the chair.
Mr. Deputy Speaker (Mr. C. P. Adermann) thereupon took the chair at 2.30 p.m., and read prayers.
– I am sure the House would like me to say that we regret the illness of Mr. Speaker, who will, if he takes proper precautions, be absent for three or four weeks. It would not be our desire that he should try to resume duty until he is completely better, and, therefore, I am sure that honorable members would like you, Mr. Deputy Speaker, to convey our sympathy to Mr. Speaker in his illness, and to make it clear that, so far as the House is concerned, it would be considered undesirable that he should resume duty before regaining proper strength.
– I agree entirely with what the Prime Minister has said, and join with him in asking you, sir, to convey that message to Mr. Speaker. 1 Mr. DEPUTY SPEAKER. - I shall be happy to convey the wishes of the House to Mr. Speaker. I understand that it is not desirable that members should visit him at this stage. His doctor has asked that members should not call on him, so that he may be given every chance to get the rest that he needs.
– I preface a question to the Minister for Primary Industry by stating that during my visit to Mildura, Redcliffs and Merbein last Friday, I found that the dried vine fruitgrowers were desirous of having made available to them full details of the methods used by the Bureau of Agricultural Economics in assessing the industry’s found costs of production. Will the Minister arrange for the director of the Bureau of Agricultural Economics, or other officer of the bureau, to visit
Mildura with a view to explaining to the growers the method used by the bureau in its recent survey of the industry? If that is not practicable, will the Minister have the required information set out in detail, and made public ?
– The Government has been carrying on negotiations for some time with the Australian Dried Fruits Association, which, I understand, represents at least 95 per cent, of the growers of dried fruits in Australia. I think, also, that it represents growers in the areas mentioned by the honorable member. That association is the authority recognized by the Government and it has full details of the methods employed by the Bureau of Agricultural Economics in computing costs. The association has had considerable negotiations with the bureau, and the Minister for Trade, regarding the various items included in the cost formula. The managing board of the Australian Dried Fruits Association has decided to publish a small booklet or pamphlet, setting out the relevant facts, including a section on the cost of production. It will distribute copies to the various sub-organizations within the association. Knowing the honorable member’s long experience in this House, and the necessity to comply with the formal rules of procedure, I suggest that he should get the local organizations within the three areas mentioned by him to obtain copies of the booklet from the Australian Dried Fruits Association; or, if that should prove difficult, I shall obtain booklets for him, and distribute them. I assure him that the facts are set out in the pamphlet, and that they are illuminating and interesting.
– I should like to ask the Prime Minister whether lie intends to table, or will give consideration to the tabling of, the report of the Standing Orders Committee that was prepared during the last Parliament, but not tabled.
– Yes. As soon as I have got rid of certain current preoccupations, I think that should be done, because the House should have an opportunity of dealing with it.
– Is the Minister for Supply aware of comments recently made by the chairman of an Australian uranium-producing company interested in the development of the Mary Kathleen deposits that, because of security regulations, he is unable to give shareholders details of negotiations which are proceeding and, more particularly, technical information such as drilling results, assays, tonnage and grade of ore? In view of the statement contained in the last report of the Australian Atomic Energy Commission that no restrictions were being placed on the publication of such information, will the Minister say what is the nature of the security regulations in operation? If these regulations were formerly in operation and have since been relaxed, has that change of the commission’s attitude been conveyed to uranium producers?
– I have seen some such statement as that to which the honorable member for Mitchell referred and, if it was intended to convey that there are any Australian security regulations prohibiting the publication of these matters, then the statement is not correct. The honorable gentleman has quite properly drawn my attention to the last report of the Australian Atomic Energy Commission, which specifically says that companies are at liberty to publish the results of assays and grades of ore, and matters of that sort. Indeed, the commission was anxious to bring that state of affairs about, because it was an encouragement to the commercial operation of the uranium industry that that class of information should be published. I think that what the chairman of this company must have intended to convey was that there was some objection hy the other contracting party to the recently announced contract against the publication of this information. That is purely a matter between the two parties. Apparently, for reasons best known to themselves, the vendor and the buyer have agreed that certain information should not he made public. But this has nothing to do with -the Australian Government. I repeat that we ourselves have imposed no restriction of that sort.
– I rise to order. May I say, Mr. Deputy Speaker, that the questions and the answers are almost inaudible? I was wondering whether you would be good enough to ask the officers to see whether the loudspeakershave been fully switched on?
– Is the PostmasterGeneral aware of the acute shortage of public telephone multi-coin equipment in Tasmania? In Launceston, particularly, there are many instances in which the installation of public telephones has been approved but is held up indefinitely because of a shortage of multi-coin equipment. Will the Minister have inquiries made into this matter with a view to having equipment made available at the earliest possible opportunity in order that urgently required public telephone facilities may be provided?
– I am not aware of the detailed position existing in Tasmania regarding the actual supply of multicoin telephone equipment but I shall have an investigation made to see whether it is possible to relieve the shortage to which the honorable member’s question refers.
– I ask the Minister for Labour and National Service whether he has yet received a report from the Tait committee that has been inquiring into the stevedoring industry, and, if so, has the Government in mind any action consequential upon it.
– A few weeks ago, I reported to the House that I had received an interim report from the Tait committee, which was then in the process of being printed and would shortly be considered by the Government. The printed report should be available for distribution to honorable members, I hope, before Easter. Before that time, I am expecting to bring to Cabinet a submission relating to the findings of the committee and from that, perhaps, consideration can be given to legislation relating to this section of industry.
– I ask the Prime Minister whether the Government has invited Mr. John Foster Dulles to call at Canberra on his way home from the Seato conference. If so, will members of this Parliament have an opportunity to hear him address them so that they may obtain first-hand information about the world trouble-spots he has visited?
– I cannot answer the honorable member’s question because I do not know positively the itinerary of the American Secretary of State. Naturally, if he were anywhere within a reasonable distance of Australia, we should be delighted to see him. I will try to ascertain what is his itinerary. As the honorable member will appreciate, these men of significance cannot always alter their programmes.
– My question is directed to the Minister for Territories. Will he lay on the table of the House, for the information of honorable members, a copy of the memorandum circulated by his department to the government nominees of the Legislative Council in the Northern Territory ? I understand that this memorandum was circulated for their guidance in their conduct and voting in that council. In view of the fact that the majority of the members of the council are government nominees, recallable at the Government’s pleasure, and that at present they are all officials of the Government, would it be possible to draw some of these official nominees from the ordinary residents of the Northern Territory?
– There appears to be some misunderstanding on the part of the questioner regarding the nature of the document to which he refers. As the honorable member will be aware, quite apart from any political position T occupy, I have had a long-standing academic interest in problems of government and public administration, and the paper he mentions was one which I wrote some years ago because of that academic interest. Normally, it probably would have been submitted for publication in the journal entitled Public Administra tion, or some periodical of that kind. It was not circulated by my department, but when some members of the Legislative Council for the Northern Territory and the Legislative Council for Papua and New Guinea expressed an interest in it, I circulated it merely as a contribution to the discussion of the problem of the position of official members in a legislative council. I doubt whether it would be worthy of the dignity of being tabled in this Parliament. I should have no objection to any honorable member reading it as an academic contribution to an academic discussion.
– Will the Minister place a copy of it in the Library?
– Yes. As to the particular point of the honorable member’? question, I should be quite willing to consider the suggestion he has made concerning the nomination of official members to any of the legislative councils for the Territories. In the first instance, however, suggestions are made to the Minister by the Administrator of the Territory concerned. On the question whether persons who are appointed to a legislative council as nominated members should or should not hold official positions, I point out that an official such as the Director of Lands or the Director of Animal Industry or the Director of Welfare has a particular contribution to make to the Legislative Council because he is familiar with his particular sector of administration, and is better able to assist the council in those subjects that) any one else possibly could be.
– Has the Postmaster-General been advised of the intended closure of the Mundiwindi overland telegraph station ? This station, which is situated on the MeekatharaMarble Bar road, 350 miles north of Meekathara, is of paramount importance to travellers and adjacent stations, especially in connexion with weather reports and the road transport of stock. I ask the Minister whether he will .take immediate action to prevent the closure of this most important facility for the people of the north.
– This matter was referred to me a few days ago by an honorable gentleman in another place and also by the honorable member himself. I am glad to inform him that I have arranged for the proposed closure of this office to be held up for a period sufficiently long to allow those interested to make further representations and proposals to the department.
– Will the PostmasterGeneral say whether the production of television equipment by Australian manufacturers is interfering in any way with the supply of essential telephone equipment? I refer particularly to the provision of rural automatic exchanges.
– The manufacture of telephone exchange equipment, especially rural automatic exchange equipment, is not being adversely affected by television developments or the transference of the efforts of manufacturers from postal requirements to those of television. Certain firms are engaged in the manufacture of equipment, especially rural automatic exchange equipment, required by the Postal Department. Certain types of rural automatic exchange machines are wholly supplied by Australian manufacturers, and these manufacturers are capable of meeting the whole demand for those machines. They are not engaged in the manufacture of television equipment and therefore the supply of telephone exchange equipment is not being adversely affected.
– Is the Prime Minister aware that a British parliamentary delegation is now in Singapore, looking over things there? In view of the fact that the right honorable gentleman does not consider that an Australian parliamentary delegation should go to Singapore, despite . the invitation which I understand has been officially extended to this country by the Chief Minister, will he consider inviting the members, or the leaders, of the British delegation to come on to Australia and give us the benefit of their impressions ?
– I must say that I have given no thought to that point, and there might be very great difficulties, but I will have the matter looked into.
– I ask the Minister for the Interior whether, in view of the everincreasing cost incurred by members of the Commonwealth Parliament in elections, and in view of the return of electoral expenses which an honorable member is obliged to make under the Commonwealth Electoral Act. which limits his expenses to £250, he will giveearly consideration to bringing the act up to date.
– I am rather glad that the honorable member has brought forward this question in such timely fashion. It gives me the opportunity toassure all honorable members that their difficulties in this regard are thoroughly appreciated. I would hope to promote a more realistic approach to the question of electoral expenses. I can assure the House only that the question occupies a rather high place among a certain number of matters which will be considered under the heading of electoral reform, and I should rather hope to have the difficulties mentioned removed before we have to face the barrier again.
– By way of explanation of a question to the Treasurer I point out that, for the purposes of allowable income tax deductions, subscriptions to superannuation, life assurance and medical benefits schemes are grouped on the income tax return form, and that the maximumamount for which claims for such allowable deductions can be made is £200. Is the Treasurer aware that, when the former Minister for Health introduced the National Health Bill into the Parliament, he told the House that subscriptions to medical benefits funds would be free of tax? As the subscriptions paid by many taxpayers for the purposes covered by those grouped items in the list of allowable deductions exceed £200 a year, will the Treasurer see that the items are ungrouped on the return form, so that the promise made by the former Minister for Health may be honoured? Will the Treasurer also review the rates of allowable deductions in respect of superannuation and life assurance contributions, with a view to increasing their standards, thus giving encouragement to thrifty citizens who are contributing in order to be able to support themselves after their retirement from work, and will thereby save the nation the expenditure of a great deal of money in the payment of social services ?
– The honorable member’s question concerns a matter nf policy which will be considered in due course.
– Will the Minister for Primary Industry say whether a request has been received from the cotton-growing industry in Queensland for an increase of the guaranteed price for seed cotton, and also for the provision of a guarantee for a period of three or five years? At the same time, are any special steps being taken to investigate the economics of this industry, because of the assistance that i ts development will render in relation to both the saving of dollars and the remedying of our overseas balance of payments position?
– The Department of Primary Industry is at present investigating the long-term prospects of the cotton-growing industry in Australia but, as yet, has not been able to come to any final conclusion as to the recommendations it may make to the Government. I understand, however, that the inquiry has disclosed that good quality cotton can be produced in Australia at competitive prices, so on a kerbstone judgment, it would appear that the prospects of the industry are bright. In the interim, the Government has agreed to extend for a period of three years the guaranteed price for seed cotton of 14d. per lb. The Government hopes that, by this means, it will give a reasonable degree of stability to the industry, and that consequently, over the next two or three years, the industry will expand and so be able to make some contribution to a solution of our balance of payments problem.
– I direct a question to you, Mr. Deputy Speaker. Would you consider informing the House that the Red Cross blood transfusion service is at present operating in Canberra, and is short of its requirements of donors? Would you agree that the blood of many honorable members, and of some right honorable members, is certainly well worth bottling ? Would you agree further that, as the resultant product is distributed throughout the Commonwealth, the mixture may have a widespread effect on the electorate generally?
-The honorable member has already acquainted the House with those facts, and perhaps other honorable members will take notice of them.
– I direct to the Treasurer a question regarding the policy now being followed by the Governor of the Commonwealth Bank, and by other government agencies, in the bond market. Is the present purpose of these government agencies, in purchasing Australian Government securities, to maintain the present yield, to increase it, or to reduce it?
– The object of assisting the market is not new but has extended over the years. The National Debt Sinking Fund resources are used for the purpose, and so are bank resources, along the lines and in the direction indicated by the Prime Minister in his recent statement. I have nothing to add to that. The desire of the Government, and of the Australian Loan Council, is to stabilize the loan market and the bond rate as far as possible.
– I direct to the Minister for Social Services a question concerning the administration of the Aged Persons Homes Act. Is the Minister in a position to say how many applications have been made and approved under the act, and can he state also the total expenditure on approved applications? Is he satisfied that the act has proved of value to the community as a whole?
– I am conscious of the very great interest of the honorable member for Maranoa in this particular aspect of the Commonwealth Government’s social services activities. If I might be permitted to reply from memory, I inform the honorable gentleman that the number of applications received and approved to date is 116. If there is any variation of that figure it will be upward by one or two. The aggregate sum approved for expenditure under the act to date, again from memory, is £1,392,000 in round figures. As to the value of the act, I can only say that its provisions are operating in such a way as to render a very great social service to the people whom it was designed to serve, to the charitable organizations engaged in these activities, and to the community as a whole.
– In answer to a question yesterday about the sending of an Australian parliamentary delegation to Malaya, the Prime Minister said that it would be an unfortunate thing if any delegation sent from Australia appeared to intervene in matters which are, at thy moment, the concern of Singapore, Malaya and the United Kingdom. Does the right honorable gentleman consider there is any inconsistency in his attitude to the sending of an Australian parliamentary delegation to Malaya and his attitude to the sending of Australian military forces to that country, where they have been operating for some time?
– No, sir, I do not see any inconsistency at all.
– My question, which is directed to the Minister for Immigration, concerns immigrants who come to this country and leave behind the iron curtain relatives, particularly children. Does the Department of Immigration attempt to negotiate with the governments concerned, so as to allow these relatives to come to Australia? Can the Minister say whom, in Australia, the immigrants should approach to make inquiries on their behalf?
– We do attempt to negotiate, in suitable cases, along the lines suggested by the honorable member.
It is by no means an easy matter in relation to several of the iron curtain governments, and in some of these countries - in fact, in all of them - at the moment Australia has no direct representation, so that such negotiations as we wish to conduct usually are conducted on our behalf by the representatives of the United Kingdom Government in those countries. Generally speaking, the governments concerned are reluctant to have their nationals moved out here, even when they are related to people already established here. In some cases it has been found possible to do that. In others, where we have been up against a brick wall - or perhaps I should say an “ iron curtain “ - we have tried to move through the International Red Cross. I think the best advice I can give to the honorable member is to suggest that, if he has any particular cases in mind, the people concerned contact officers of the Department of Immigration, preferably the chief immigration officer in the particular State, and we shall do our best to bring about the desired result.
– I point out to the Prime Minister that the dismissal of mine workers has caused, and is causing, much anxiety and hardship to those engaged in the coal-mining industry. I ask the right honorable gentleman, as head of the Australian Government, to give immediate attention to the stabilization of this important industry. Will he give th, fullest support to coal utilization research through the Commonwealth Scientific and Industrial Research Organization and other approved scientific bodies, and also to long-range planning for the industry? Finally, will he see to it that, in order to arrest the drift of our overseas funds, greater use is made of coal rather than oil fuel by Commonwealth instrumentalities?
– The important matters inquired into by the honorable member have been engaging the attention of the Minister for National Development. I am not entirely up to date on the matters. I shall ask the Minister to provide me with up-to-date information so that I may convey it to the honorable member.
– Has the attention of the Minister for Immigration been drawn to reports that some immigrants to this country are participating in the activities of illegal and undesirable secret societies? Will he cause such reports to be investigated? Further, will he see that every precaution is taken to ensure that, as a result of the activities of these societies, the good name of the majority of immigrants to this country will be in no way sullied?
– For a long period of years now, there have appeared from time to time in some sections of the press rather lurid accounts of the activities of alleged Mafia gangs, blackhand gangs and other secret societies. I assure the honorable gentleman that, whenever such reports appear, however unsubstantial they may be, they are carefully investigated to see whether there is any truth in them. Our examinations over the years have not at any time revealed any confirmed evidence of such occurrences. A report appeared quite recently in one of the Queensland newspapers to the effect that some Commonwealth inquiry has revealed the existence of this kind of activity. The Department of Immigration raised the matter with the Commonwealth Investigation Service and ascertained that no such inquiry had been conducted by that body and that it had no such evidence in its possession. The honorable gentleman has requested that we endeavour to clear immigrants generally from any blame that may be attached to them as a result of unsubstantiated allegations. In that connexion, I refer all honorable members to the two very informative reports produced by the committee under the chairmanship of Mr. Justice Dovey. The committee examined the whole of this question and published its findings.
– I address a question to the Prime Minister. In view of the geographical proximity of the island of Cyprus to Australia’s principal trade route through the Suez Canal to the United Kingdom and western European countries - which are our best customers - and having in mind the serious internal disturbances which have developed and which have been aggravated by the deportation of the Greek Orthodox Archbishop of Cyprus, will the Prime Minister make recommendations to the United Kingdom Government with a view to bringing about a peaceful and amicable settlement of the dispute? Will he consider offering to the United Kingdom Government and the Government of the Kingdom of the Hellenes the services of the Australian Minister for External Affairs as a mediator in a dispute which is causing much sorrow to many thousands of Australians of Greek birth and descent?
-The honorable member must be under a misapprehension if he does not think that the United Kingdom Government is trying to bring about a peaceful and amicable settlement of the Cyprus problem. I have never quite understood the itch that we occasionally suffer from to enrich everybody else with our advice on their problems. I have no such itch in this case. I think that the United Kingdom Government and the people of Cyprus may well be left to work this matter out for themselves. After all, we have a few problems of our own, and we should not be very pleased-
– The Prime Minister will have a few problems to-night.
– Yes; we have a few problems of our own, and the honorable member who interjected may be one of them, but we should not feel grateful to perhaps a dozen other countries in the world if they said to us, “We can tell you exactly what you ought to do about them”. My motto is to look after our own business and let other people look after theirs.
– My question is directed to the Minister for Trade. In view of the fact that the United Kingdom has intimated that it is unwilling to join in an international wheat agreement of the type now operating and soon due to expire, will the Minister inform the House of the progress, if any, of the negotiations now being conducted at
Geneva, and whether there is any likelihood of an agreement being arranged as a result of those negotiations ?
– I believe that it is a little early for me to offer an opinion about whether there is likely to be an acceptable agreement as the outcome of the present negotiations being conducted at Geneva, but full-scale negotiations are proceeding, and not on any hastily conceived basis. There was a conference in Geneva last October on this matter, and on the 20th February the representatives of a very comprehensive aggregation of nations met to consider it. All the principal wheat importing countries which are parties to the present agreement are represented at the conference, as also are all the principal wheat exporters which are parties to the present agreement. The Argentine and Sweden, which are wheat exporters, are participants in the present negotiations. Soviet Russia and other* iron curtain countries, together with’ Turkey, are represented by observers, and the United Kingdom, which withdrew from the last agreement, has been represented and has stated an attitude, but has temporarily withdrawn. Tremendous importance attaches to the final stand of the United Kingdom, which is the world’s greatest importer of wheat, in this particular issue. The United Kingdom Government has objected to an agreement of the present type on two main grounds; first, that the agreement does not provide rules for the disposals of existing surplus wheat, or rules which deal with future production, and secondly, that the agreement, in its opinion, does not enable a price to float between floor and ceiling. The first points are matters of great interest to Australia. We have already stated our position clearly in respect of the disposal of surpluses and future generation at uneconomic cost of further wheat production. I am bound to say that I should be happier if the United Kingdom Government, having put its finger on the problems, had come forward with specific constructive proposals, which could be discussed, as to how this problem might be solved. I say that, because I believe that in a frank discussion it is not impossible to secure a sufficiently wide agreement on this problem. Australia is anxious to maintain order in the world production and sale of wheat, but I point out to some countries more conveniently situated to Geneva than we are, that while we have representation in Geneva of the Government, the growers, and the Australian Wheat Board, our people are 10,000 or 12,000 miles from home and cannot be expected on grounds of convenience or expedience, literally to hang round for months while other people make up their minds about the stand that they will take.
– I ask the Treasurer whether it is a fact that it is the policy of the Government to encourage young people to take up studies at universities and technical schools as a major contribution to the future welfare of Australia. If the answer is in the affirmative, will the right honorable gentleman consider exempting for income tax assessment purposes, money expended in purchasing books and other necessaries for the pursuance of their studies?
– This Government has given very practical consideration and valuable concessions to students for travel, dues, fees and books, and it was the first Commonwealth Government to do so. I am afraid that nothing further can be done in that direction in the general scheme of things.
– Will the Minister for Health indicate to the House the estimated cost to the Australian Government of the immunization campaign against poliomyelitis? On what basis is. it proposed to conduct the campaign? Has an agreement been made with, the States for the distribution of the vaccine?
– I cannot give the honorable member the actual estimated cost of the campaign. I am sure he will appreciate that that figure could not be settled very early, but 1 shall endeavour to obtain some estimate of the costs in the first year. That will depend largely upon the number of persons who apply for immunization. As to the arrangements with the States, the Commonwealth Government will bear the whole cost pf the manufacture of the vaccine and will deliver it to the States, in return, the States will bear the cost of inoculations and administrative arrangements within the States. The State governments have expressed themselves as satisfied with that arrangement, and final details of it are now being worked out.
– Has the Minister for Territories given any further consideration to the proposal to set up democratic local government in the Northern Territory? Did the reference of the Minister last week to the constitutional development of the States as a probable model mean that, when he does set up those local governments, he will establish legislative councils, such as those which have frustrated the will of the people in most States for the greater part of a century?
– I think that the honorable member has confused local government, in the narrow definition ‘of municipal government, with representative government for the whole Territory. We have passed a local government ordinance in the Northern Territory which makes provision for the creation of local government bodies, and it is the earnest wish of the Government that the citizens of both Darwin and Alice Springs will undertake immediately the responsibility of local government. Any delay that occurs is purely the responsibility of the citizens of those towns.
– Yesterday, the honorable member for Hughes (Mr. L. R. Johnson) asked me a question about a dispute at the atomic reactor project at Lucas Heights, New South Wales, and suggested that there had been a lockout on the part of the contractor. I am now able to give the facts to the honorable member and the House. This is, or was, a demarcation dispute as to which unionists should work certain portable compressors at Lucas Heights. On the 28th February, the Federated Engine Drivers and Firemen’s Association delegate demanded that his men only should work these compressors which, up to then, had been operated by the Australian
Workers Union and refuelled by the Federated Engine Drivers and Firemen’s Association. The contractor said that he could not instruct the unions on this matter, and suggested that they ought to get together and work it out between themselves. On the oth March, without any notice to the contractor, twenty Federated Engine Drivers and Firemen’s Association men went on strike. This meant the cessation of work on excavating plant, cranes, hoists, drainage and concreting as v.-ell as compressors. The Australian Workers Union delegate on the job instructed his men to refuel the compressors. There was a stop-work meeting on the job, and the Australian Workers Union men refused to obey the directions of their own delegate. The contractor then referred the dispute to the Commonwealth Arbitration Court, and the hearing was set down for the 9th March. By the 6th March, the com.pressors had run out of fuel, and work on them stopped also. On the 7th March, the Sydney organizer of the Australian Workers Union came out and urged his men to refuel the compressors. They still refused, although they knew that the 84 other Australian Workers Union men, whose work could not proceed in the absence of the compressors, had to be stood down. When these 84 men were stood down, there were 22 other men not affected, but the members of the Australian Workers Union then said, “ One out, all out “. .So they all went on strike. There were also 42 members of the Builders’ Labourers Federation who could not work in the absence of the compressors, and they were stood down at the same time as the 84 men were stood down. In fact, there was no stand-down provision in the award, and they had to be dismissed. On the 8th March, the Builders’ Labourers Federation also adopted a “ one out, all out “ policy, and they all went on strike. Their organizer visited the site from Sydney and advised them against this course, but they rejected his advice and stayed on strike. The members of the Building Workers Industrial Union of New South Wales - the carpenters - then told the contractor that they would not work without the assistance of the labourers of the Builders’
Labourers Federation, and they also went on strike. The contractor immediately referred the dispute between the Australian Workers Union and the Building Workers Industrial Union to the New South Wales Industrial Commission, which was the apropriate tribunal, for hearing on the 9 th- March. At the same time the Builders’ Labourers Federation dispute was referred to the Commonwealth Court of Conciliation and Arbitration. On the 9th March, the members of the Building Workers Industrial Union, who, the day before, had declared their intention to stay on strike, nevertheless turned up for work. In the absence of the labourers, eighteen out of 71 were given notice of termination of employment. The remainder were kept on, but the Building Workers Industrial Union again adopted a “ one out, all out “ policy, and they all went on strike again. Ar, this stage, on the 9th March, about 300 men were absent from work, leaving fourteen plumbers, twelve metal tradesmen, and three transport drivers on the job. At 11.30 a.m. on the 9th March, the hearing of the dispute between the Australian Workers Union and the building Workers Industrial Union took place before the New South Wales Industrial Commission, but finality was not reached. At 2.30 p.m., in the Commonwealth Arbitration Court, the Conciliation Commission, Mr. Austin, told the representatives of the Federated Engine Drivers and Firemen’s Association of Australasia that the members of that body had no claim whatever to the work of operating the mobile compressors, as this job had been specifically excluded from their award at the request of the federal secretary of the association. Mr. Austin instructed the representatives of the association to have its members’ return to work. On the 12th March, the members of the association held a meeting on the site, and voted in favour of a return to work. At the same time, the members of the Building Workers Industrial Union, the Builders’ Labourers Federation and the Australian Workers Union each held meetings off the site, and all voted to return to work. The contractor then sent telegrams to the eighteen members of the Building Workers Industrial Union and the 42 members of the Builders’
Labourers Federation who had been dismissed, and the House will be delighted to learn that they all are now back at work.
Mi-. HAROLD HOLT (Higgins- Minister for Labour and National Service and Minister for Immigration) [3.19]. - On behalf of the Vice-President of the Executive Council (Sir Eric Harrison), I move -
That so much of the Standing Orders be suspended as would prevent the Prime Minister from making a statement on economic measures
The honorable member for Melbourne (Mr. Calwell) raised with me the question of what provision would be made for the Leader of the Opposition (Dr. Evatt) in relation to this matter. After consultation with the Prime Minister (Mr. Menzies), I have been able to assure the honorable member for Melbourne that similar arrangements will be made for the Leader of the Opposition, who, I understand, wishes to take up the debate on the evening of Tuesday next. The Standing Orders will then be suspended in the same way.
Question resolved in the affirmative.
– I move -
That the bill be now read a second time.
The purpose of this bill is to make certain amendments to the Meat Agreement (Deficiency Payments) Act 1955 which will become necessary by reason of the repeal of the Meat Export (Additional Charge) Act 1955 and its proposed replacement by the Meat Export (Additional Charge) Act 1956. In my speech on the second reading of the Meat Export (Additional Charge) Bill 1956, which., if passed by this Parliament, will bring about the legislative change I have just mentioned, I explained the background to the change. However, as that bill is a taxing measure, it is necessary, because of section 55 of the Constitution, to introduce a separate measure incorporating incidental provisions not specifically of a taxing nature. The separate measure is the Meat Agreement (Deficiency Payments) Bill, which contains two effective provisions. The first, which is set out in clause 3, is a simple one enabling moneys collected under the Meat Export (Additional Charge) Act 1956 to be paid from Consolidated Revenue to the Australian Meat Board, as would have been the case with any moneys collected under the 1955 act. The second is really a series of provisions, as set out in clauses 4 to 6 of the bill. These have been made necessary by the alteration to the method of calculating the export charge. Under the former method, the charge would simply have been payable on meat as it was exported, and fairly complete details would have been available without any special powers being required by legislation for the purpose. However, under the method introduced by the amending legislation, it will be necessary to rely, to a large degree, on information of the kind that can be supplied only by exporters, including information as to the kinds and classes of meat placed in store from time to time. In effect, exporters will supply the same information for the purpose of paying the charge as they did in support of their claims for deficiency payments last year. Consequently, the present bill is intended to give the same power to the Minister to authorize persons to call for returns and information, and to inspect books and accounts which are relevant to the charge, as he has in relation to the making of deficiency payments. It also provides for the same penalties for false or misleading statements regarding the charge as exist in the case of offences involving deficiency payments. I commend the bill to thu House.
Debate (on motion by Mr. Pollard) adjourned.
– I move -
That the bill be now read a second time.
Prior to the introduction of the Fisheries Act 1952, discussions were held with the Ministers responsible for fisheries in the various States to co-ordinate the implementation of the Commonwealth legislation. It was agreed that the establishment of a separate fisheries inspection service at the Commonwealth level was to be avoided, and that, where practicable, the administration of the Commonwealth fisheries legislation should be carried on through the existing State machinery. This has been done, and, although some difficulties have arisen, the arrangement will probably prove successful. Under this arrangement, the State fisheries officers, using delegated powers, issue licences and effect registrations under the Commonwealth act. At present, all Commonwealth licences and registrations terminate on the 31st December following the date of issue to coincide with the licensing periods applicable to most of the States. Thus, at the beginning of each year, there is an excessive volume of work associated with the renewal of licences and registrations. In order to reduce this work load, the States have made provision under their own legislation for State licences issued during December to be effective until the 31st December of the following year.
The purpose of this amendment to the Fisheries Act 1952-1953 is to make the same provision in the Commonwealth legislation, and thereby make it possible for the State officers to issue Commonwealth licences, and effect registrations - where applicable, in December at the same time as they issue the State licences. The Government’s legal advisers suggest the inclusion of section 2 (fc) to remove any difficulty which might be created by a licensee holding two licences when a licence is renewed in December. In such cases a licence issued in December would be dated to take effect from the 1st January following. The passage of this amendment will considerably assist the State officers responsible for issuing licences and effecting registrations on behalf of the Commonwealth, and will avoid unnecessary inconvenience to fishermen. I therefore recommend this bill to honorable members.
Debate (on motion by Mr. Pollard) adjourned.
Debate resumed from the 13th March (vide page 749), on motion by Mr. Casey -
That the following paperbe printed: -
.- The speech of the Minister for External Affairs (Mr. Casey) traversed quite a lot of ground, but as is usual with his speeches, it lacked realism in its approach to foreign affairs. This lack of a realistic approach is, of course, characteristic of this Government. In one section of his speech the Minister referred to the Colombo plan and stated that it “was too soon to look for spectacular results in the shape of visibly improved living standards. It appears to me that if the Colombo plan has snot assisted to uplift theliving standards of the Asian people it is not doing the job for which it was intended. As a matter of fact, the Ministercould have told us a little more about the living standardsof the countries which come under the Colombo plan, because the people of these Asian countries are actually eating less than they did before the war. This is revealed in the November issue of the Current Notes on International Affairs which covers a report recently submitted to the nations participating in the Colombo plan. It is true, of course, that the population of those Asian countries is increasing by approximately 10,000,000 per annum. Still, the point is that the plan is not achieving its purpose and, if it is to be successful at all, we must have something of a gigantic nature, more on the scale of the Marshall plan, which was applied to many European countries after World War II. and which did so much to rehabilitate them. Something of that magnitude has to be achieved if the Colombo plan is to be of value to the Asian countries. In 1954, Australia’s contribution to the plan was about £3,000,000. Canada, which is not nearly as close to the Asian scene as we are, contributed £12,000,000. Had Canada contributed on population basis on the same scale as Australia, its contribution would have been under £5,000,000.
This shows clearly that Australia is not doing the job it should be doing under the Colombo plan.
It is true that Australia’s contribution increased in 1955, but a comparison of” our contribution with the defence vote of £190,000,000 in 1955, and the amount allocated to defence during the past few years, shows that more could have been done for the Asian participants in the Colombo plan.Recent reports indicate that actual expenditure on defence this year is about £80,000,000 less than the amount provided, so shortly there will be a rush to expend as much as possible under the various heads of defence before the end of the financial year. The money will be wasted, just as it has been wasted previously. I suggest to the Government that it would be better if a big proportion of the defence vote were applied to activities under the Colombo plan, even if it were only the amount we have been unable to expend on defence in recent years. Such a course would creategoodwill with Colombo plan countries, whereas at present we are just playing around with the problem. Our aim must be not only to increase the economic resources of those countries but also to improve theirstandards of living, so that they may develop into democracies in the real sense of the word and so that they may have faith in “the democratic countries. If we could persuade them to become our friends by a correct and humane approach to their problems, the main purpose of our defence expenditure would disappear to a large extent. If we are to defeat communism in thosecountries and ate encroachment on them we must get down to the real problem of feeding these Asian peoples and stopping their exploitation.
Even in Asian countries, which have some form of democratic rule, as well as those where such rule is unknown, much exploitation is occurring. Mr. Justice Douglas, who is well known to honorable members and who was entertained by us at luncheon only about twelve month ago, when he spoke about these matters and was well received, says in his book, North from Malaya, that in some of these countries 2 per cent. of the people own 98 per cent. of the land, and the rents which are charged the peasants to entitle them to work that land allow them only a bare existence. Further, there are many absentee landlords, which in itself is shocking, especially when considered in conjunction with the exploitation of these peasants. Money lenders charge the poor from 200 per cent, to 400 per cent, on loans, with the result that the poor are never actually out of debt. Whilst such exploitation of the people is permitted to continue, there is always a danger of the spread of communism in these countries. There is no doubt that these peasants will tura to anything that offers them some apparent improvement in their way of life. At present, many of these countries are betwixt and between; they do not know who is with them and who is against them. Their leaders are adopting a more or less independent line, but they have indicated very clearly that “they are just as much opposed to aggressive communism as to aggressive anti-communism. They do not trust the Western Powers, simply because so far the democracies have failed to gain their confidence, and this is most unfortunate.
As a matter of fact these people regarded the Korean war as a conflict, not between the United Nations and aggression, but between the AngloAmerican power bloc and the Communist power Hoc, in the course of which an Asian country was laid to waste. They have not forgotten that the first test of an atomic bomb was made, not on a European country, but on Japan, an Asian country. The leaders of the Asian peoples have not forgotten these events, and consequently it is not easy to win their confidence. That is why Asian countries are now looking more to India for leadership, and why Nehru has become such a powerful influence on Asian countries. He “has stressed five principles in regard to foreign relations, which, in my opinion, should be a guide to all the nations of the world. Briefly, these very fine principles are mutual respect, mutual non-aggression, non-interference, equality, and peaceful co-existence. If all the nations of the world were to adopt these principles there would be no war. At the present time we cannot ignore the voice of Asia. The refusal of Burma, India and Indonesia to join Seato was a staggering blow to Australia and to the Western Powers, but it was an indication of the Asian viewpoint which we cannot ignore. If we are to keep on living with the Asian countries we must accept their viewpoint in such matters. We must realize, too, that no longer have we the monopoly not only of playing the game but also of laying down the rules under which it must be played. The Asian nations want a say not only in the playing of the game but also in the making of the rules, and the sooner we realize that the better it will be, not only for Australia but also for the Western Powers.
Mr. Nehru said, in effect, that the Asian nations would have no part in any organization which was designed to hold Asian aspirations in check by force of arms. Consequently, we must realine our thinking in this matter and realize that no brute force will crush Asian determination to have a place in the sun. Asian “have-nots’” must be quickly converted into “ haves We have missed wonderful opportunities in the past to win over large numbers of the Asian people; but the Communists, being more cunning, have made inroads into Asian countries. Because the Communists promise to ease their unfortunate circumstances, the Asian people look to the Communists for some form of leadership.
Mr. Justice Douglas says in his book that in fifteen years there will be 150,000,000 more people in Asia. The present food supply cannot possibly cope with that population. It would be interesting to know what the Asian mind is thinking when it hears about the huge surpluses of foodstuffs banked up in countries such as Australia, the United States of America and Canada, and when it hears talk about restriction of production. Such conditions provide fertile soil in which communism can work, and enables Communists to get their ideas over the masses. Surely, we can devise some plan whereby the surplus products of countries can be made available to countries that do not have surpluses. It should not be beyond our power to do something in that respect. As a matter of fact such action would be the very answer to our own economic problems. Whenever we cannot get rid o’f surplus goods the economic system of capitalism begins to break down, as is the case at the present time.
Mr. Benson, the Secretary for Agriculture in the United States of America, mentioned in a report published in the Melbourne Age of the 10th September, 1955, that each night two out of- three members of the human race go to bed hungry. He said -
It is a shocking indictment of man’s intelligence that this shoul’d be so. The tragedy is that, in some respects, -we have not improved our trade relationships among the nations much beyond cave man concepts.
A report published in Muster of the 13th September, 1955, commented on the above statement as follows: -
Here is a challenge to the statesmen and the experts of the Western world, a challenge the successful meeting of which would go further towards banishing the twin 20th Century threats of war and revolution and, at the mme time, do more to promote continuing prosperity in the exporting nations than any other single move.
It would be interesting to know to what extent, if any, the matter has engaged the serious attention of our own Government and its advisers.
I could tell them how it has engaged the attention of this Government - not at all, because it is not prepared to deal with these problems effectively. I have heard it said by honorable members opposite, “What is the use of sending wheat to Asian countries? Their staple diet is rice “. Nobody can make me believe that if people are hungry they will not eat wheat if they have not sufficient quantities of rice, just the same as we would eat rice if we could not get sufficient wheat for our requirements. It reminds me of the French Queen who, when she was told that the mobs of Paris were calling out for bread, said, “ Tell them to eat cake “. She did not know enough about them to realize that they had never had any cake to eat. It would be a gesture of peace and goodwill to the Asian countries if we were to do something to help these people and, at the same time, help to stem the advance of communism. We must feed the hungry, educate the people and introduce rent and land reforms in those countries. We can do that not by manufacturing still more atom bombs but by improving the happiness and wellbeing of the people. It is not much use talking about freedom, as we so often do, when people are hungry. Freedom to eat is one of the most important of all freedoms.
Many Western leaders refer to the present situation (is the “ Asian menace “, but let us not forget that the Asian coun-tries refer to us as the “ white menace “ ; and they have more cause to do so because over the years the British Commonwealth of Nations and other Western Powers have been exploiting the Asian countries. Britain’s colonies were referred to by James Mills as -
A gigantic system of outdoor relief foi British governing classes. Middle class families live upper class lives and go to the colonies to do so.
The fact is, of course, that there are still many in the Western camp who are in no hurry to grant full freedom to the Asian people. It is a dangerous policy which has been pursued by tory governments, although recently there has been a change of heart. A British Labour government granted a number of countries their independence and the present tory Government of Great Britain i3 now prepared to grant Malaya its independence but does not appear to be willing to grant independence to Singapore. Australia, must not fail to lend moral and material support to the aspirations of the colonial peoples for national freedom. The consequence of not doing so will, in the long run, mean war with all its horrors. That no one can win such a war has been clearly pointed out by national leaders in recent reports. We have more to lose than the Asians; they have nothing to lose but their hunger.
General Douglas MacArthur, in the West Australian of the 28th January, 1955, called upon the nations to abolish war and said that if war could be outlawed it would mark the greatest, advance in civilization since the Sermon on the Mount. He continued -
It would lift at one stroke the darkest shadow which has engulfed mankind from the beginning. It would not only remove fear and bring security, it would not only create new moral and spiritual values, it would produce an economic wave of prosperity that would raise the world’s standard of living beyond anything ever dreamt of by man. The ordinary people of the world, whether free or slave, are all in agreement on this solution. And this perhaps is the. only thing in the world they do agree on. But it is the most vital and determinate of all. The leaders are thu laggards.
Tr is true that the leaders are the laggards. The pressure for war comes from the top, not from the mass of the people. The people realize that they have to make all the sacrifices, send their sons and fathers to war and work long hours under unfavorable conditions. If public opinion could be directed against war, the result would be the abolition of war. Now that we are threatened with the horrors of the hydrogen bomb, it is probable that public opinion will lean that way. As a matter of fact, it is coming round that way continually. It will be remembered that about eighteen months ago, Professor Oliphant outlined, to honorable members of both Houses, the tremendous forces that would be let loose in a third world war, and it would be well for honorable members to reflect on the warning that he gave. Scientists are warning us repeatedly of the dangers to the human race of merely experimenting with nuclear energy. I suggest to the Government that rather than interfere in these Asian countries in the way in which we are, we should try to do more to create goodwill, and by that means remove the causes of war.
.- The honorable member for Stirling (Mr. Webb) has given us a string of platitudes and half truths and, I am afraid, some misleading statements. I shall not deal in detail with all his contentions, but I have picked out two or three about which I wish to say something. He said, and quite rightly, that we cannot ignore the voice of Asia. We on this side completely agree with that statement. He went on to say that, in the past, we in Australia have missed opportunities of winning friends in Asia. With that statement, we could not agree more; but I point out that it was only after this Government came into power in 1949 that something concrete was done about winning friends in Asia. Therefore, I say it is platitudinous idealism for the honorable member for Stirling to charge this Government with not doing anything to win friends in Asia. I believe that if he were really honest with himself, if he were prepared to face the facts, he would agree that this Government, by implementing the Colombo plan in 1950, has done something really great for the people of this part of the world in which we live, and, in particular, for the people of SouthEast Asia. In the course of my remarks, I shall have more to say about the Colombo plan, and the part that Australia has played, and is playing, in connexion with it.
Before passing on to other matters, I take this opportunity of denying flatly the allegation made by the honorable member for Stirling that this Government is not coming to grips with the situation in Asia. I think I have quoted his words correctly. The Minister for External Affairs (Mr. Casey), who is at present attending a conference of the Seato powers in Karachi, on behalf of this country, has, on his own admission, been spending at least half of his time in recent years in dealing with the problems of Asia and South-East Asia. I suggest that is a very good percentage of time for a. Minister to apply to the problems of any one region of the world. It is quite incorrect for the honorable member for Stirling to say that this Government has failed to get to grips with the situation in Asia. His statement is not in accordance with the facts.
This House is very much indebted to the Minister for External Affairs for the clear, concise, and complete statement that he has given to us on the present situation in the world. It is unfortunate that the Minister himself cannot be present during the course of this debate, particularly to give us, and the country, the benefit of his summing up at its conclusion. If any one has toiled incessantly, the Minister has done so in dealing with the very thing in which the honorable member for Stirling says we have been failing - the building up of goodwill in Asia and trying to help the peoples of Asia to an ultimate realization of their own ambitions and the attainment of their full place in the world.
The Minister has also laid great stress on the necessity for, and the value of, the interchange of visits between the representatives of Australia and those, of the various countries* of Asia and SouthEast Asia. No one has been plugging at this- more than the Minister over recent years; and it is good, to* know that there ia in contemplation, later this year, a. visit, by Pandit Nehru, the distinguished and able Prime Minister of India. I believe that in the- past, there has been more of a tendency towards one-way traffic. We believe that there should be a greater flow of distinguished people to Australia than there has been in the past and, therefore, the Government,, and I, as a supporter of the Government, most certainly welcome this projected visit to Australia of Pandit Nehru, either some time later in this year or early in 1957.
I was very interested also to read in a. British paper a few weeks ago that Sir Anthony Eden,, the Prime Minister of Great Britain, was in favour of holding conferences of Prime Ministers in rotation in the capitals of the various Com.monwealth countries.. That, too, is a very good forward view. I think that rotation in the way that he suggests not only of conferences of Prime Ministers but also of conferences of foreign Ministers would do much to build up the goodwill and mutual understanding which are so essential for the well-being of the world.
During this debate, much has been said about- the Middle East. I do not propose, in the short time at my disposal, to try to canvass the subject fully,, but I do want to make one or two comments about the Middle East situation. The Middle East is, historically, of vital strategic importance-. Quite apart from its geographical situation, its oil makes it of paramount strategic importance in the world. No one knows and understands that better than the Soviet leaders. Undoubtedly, they have been behind all the strife and trouble that exists in the Middle East at the present time. I have no doubt that the recent dismissal of Glubb Pasha from Jordan is tied up in some way with this plot of the Soviet to gain control of the Middle East and to establish a Communist axis via Egypt, Saudi Arabia and as: many other countries as they can manage to bring, within their orbit.
Some reference was made to Cyprus this afternoon, but I feel that this is not a matter of any direct concern to Australia,, although it is definitely of indirect importance to us, because anything to do with the Mediterranean must certainly affect our lifeline and the link between Australia and the Old Country, and between Australia and the countries of Europe. As to the present difficulties there, one can only hope that the Greek and Cypriot leaders will not allow the Enosis movement to become a Communist tool. That is one point I want to make, because I believe that would be the key to’ future development in the Mediterranean, and in particular, in the eastern Mediterranean. There is no doubt in my mind of the Soviet aim to bring the Mediterranean, the eastern Mediterranean first of all, within the orbit of its power. I have no* doubt that the situation in Cyprus is being watched with very great interest indeed by the- Soviet, and that the- Russian leaders will not lose any opportunity to maintain the trouble- that is already existing in that country. I feel, as the Prime Minister (Mr. Menzies) suggested, this afternoon. that this is. primarily a matter for the British Government and I, therefore, make only passing reference to it, but I do want to say, without canvassing- the’ rights and wrongs of the Enosis movement, how important I feel it is that, the movement should not become the tool of the Communist leaders. We have been reading also a good, deal about the Baghdad pact. I was. interested to read a. few days ago that the British Foreign Minister,. Mr. Selwyn- Lloyd, has been trying to persuade the United States of America to join the Baghdad pact. At present, Great Britain, Iraq, Persia, Pakistan and Turkey are members of that pact. With the great power that the United Nations wields in the world to-day, I feel that the Baghdad pact, which is of great significance in regard to the affairs of the Middle East, would be vastly strengthened if it had the moral and general support of the United States.
If, by any sorry chance, things were to go really wrong with Cyprus, and the Soviet were to extend its power in the eastern Mediterranean’, there is an obvious, danger that Turkey would be isolated. In view of Russia’s known intention of overrunning Persia and Iraq and gaining control of those countries, the situation in Turkey would then be virtually .impossible. The position of the Western Powers in the Middle East would have deteriorated to a point of very great seriousness. We all hope that these thing3 do not come about. I consider that the situation in Cyprus and the situation at the moment in Jordan will have a very great bearing on the ultimate result.
A number of honorable members opposite has been advocating the admission of red China to the United Nations. The Government’s attitude in relation to this matter has been made very clear to-day by the Prime Minister, as it has been made clear by the Minister for External Affairs from time to time. I fully agree with the Government’s attitude that it is not yet time for red China to be admitted to the United Nations, because that country -has not demonstrated its good faith in relation to peace in the world. We have had in the last few years the unhappy experience of Korea, and the subsequent unhappy experience of Indo-China. Until such time as red China demonstrates by deeds - not just words - that it has good faith in the matter of keeping peace in the world and not extending aggression, I believe the time is not ripe for that country’s admission to the United Nations. If Ted China were so admitted, it would simply mean that the power of the Soviet bloc in the’ United Nations would be just so much stronger. Knowing as we do how the Soviet Hoc uses this power in order to disseminate red propaganda and further red interests throughout the world, I feel very strongly that we are taking the right stand at the present time. I do not say that, at some future time, when conditions had changed and red China’s attitude had demonstrably .changed, that country might not be rightly admitted, but at the present time there is no doubt in my mind that we are correct in keeping red China out of the United Nations.
Only a few days ago, we read press reports of a possible early attempt by red China to ““liberate “ Formosa by making a preliminary onslaught on the islands of Matsu and Quemoy off the Chinese mainland. It is reported that Communist destroyers have been active around Matsu and Quemoy in recent days, that a great many Chinese aeroplanes have been moved into the areas near the coast within 40 miles of Matsu, and that a network of radar stations has been developed around that region. According to military intelligence reports from the Nationalist head-quarters on Formosa, the Communists have been particularly active, and it is quite possible that at this moment they are preparing to mount an offensive to take the first step towards the “liberation” of Formosa.
The Soviet and red China know very well the strategic importance of SouthEast Asia, and the story of the IndoChinese war and the subsequent story of southern Viet Nam give one cause for anxiety. The Communists know very well that if they had control of the Associated States of Indo-China, they would have the key to South-East Asia. They would have the key to the richest rice bowl in the world. They would also, if they were successful in pushing their advance further to Malaya, as they no doubt hope to do, have control of half of the world’s supply of tin and threequarters of the - world’s supply of rubber. I say again that before we can consider the claim of red China for admission to the United Nations, the pattern of aggression which has been followed in recent years must be clearly abandoned by the leaders of that country.
The Soviet leaders f ear one thing above all else at present, and that is, that the real truth of .the situation in the outside free world should become known to the people behind the- iron curtain. There, I .suggest, is a weakness in the Soviet Communist structure which the leaders of the free world should endeavour to exploit. Until such time as the artificial division called the iron curtain - I think that term was first used by Sir Winston Churchill - is broken down, until such time as freedom and light come again to the people behind the iron curtain - the mass <>f the people who ara undoubtedly peace-loving and are undoubtedly having the truth kept from them and are being misled in regard to “Western intentions - and until such time as there is freedom in Russia, there can he no real freedom and no real peace in the world.
A few days ago, there was also a very interesting announcement concerning psychological warfare in relation to South-East Asia. The press report read -
Radio Australia soon will beam a two hours a day broadcast in Mandarin to South-East Asia. The Mandarin broadcast will include news items, news commentaries, political talks and music, in two sessions - one morning and one at night . . . The broadcast is aimed at penetrating the millions of Chinese in SouthEast Asia as well as in China proper and Fi.rmosa.
I believe that this is a most valuable development, which will add to the already good work that is being done by Radio Australia in its broadcasts in the English, Siamese, Indonesian, French and other foreign languages. Our future is inevitably bound up with the outcome of the struggle in Asia. If any one had any doubt as to the real purpose of the Russian leaders, those doubts should have been dispelled by the very clear statement of intentions by Krushchev himself - the Communist General-Secretary in Russia - only last December. It is known perfectly well that the tactics of the reds change from time to time, but I for one do not believe that their underlying strategy in relation to world conquest has changed one iota.
If the Soviet leaders were really sincere in their expressed desire for peace, they would have demonstrated that sincerity by agreeing to German unity and to a proper method of disarmament accompanied by inspection. But they have not agreed to that. They are still sitting behind the iron curtain, with one-third of the human race enslaved and living under conditions of the greatest misery and dejection and with little hope for the future. If reports are correct, there are behind the iron curtain underground revolutionary forces at work. We should, with all the psychological weapons at our disposal, give aid, comfort and moral support to these underground forces, and to any forces of any kind behind the iron curtain which are seeking to overthrow the red leaders.
– Would the honorable member encourage a revolution?
– Yes, to overthrow the red leaders - of course I would ! I would encourage the people of Russia to engage in a revolution to overthrow the present leaders. The work of the United Nations is by no means complete, because it is not always possible to put the principles of the organization into effect. While the power of veto continues to be used as it has been by the Soviet Hoc. I think there will continue to be a need for regional pacts. This Government has been playing a most important part in the drafting and implementing of such regional pacts and agreements as the Anzus pact and the Seato agreement. In fact, the Minister for External Affairs is now attending a meeting of the council of the South-East Asia Treaty Organization.
We must pin our faith to a policy of collective security. We must adopt defence measures that are obviously adequate to meet the situation, but such measures alone are not sufficient. We must also adopt sound economic measures and sound social policies. That is what this Government has been doing under the Colombo plan. I venture to suggest that the previous speaker, the honorable member for Stirling has not really studied the Colombo plan and its implications.
– Order! The honorable member’s time has expired.
.- A debate of this kind is of very great importance, but I regret that in recent years a situation has arisen in this Parliament whereby Opposition members, unless they agree whole-heartedly with a statement that is made by the Minister for External Affairs (Mr. Casey) or a supporter of the Government, are regarded as being bad . men. In a debate on foreign affairs members should be free from insults, free from petty thinking by Government supporters, and free to express their personal views. In the present state of affairs, if Opposition members oppose the sending of troops to Malaya, they are regarded by supporters of the Government as being
Communists. That is a wrong interpretation to place upon the views of Opposition members. If we support the admission of republican China to the United Nations organization, Government supporters claim that we are Communists, despite the fact that we advance clear and unmistakable reasons for our attitude. Therefore, it is very difficult for honorable members on this side of the House to express freely in a debate of this kind, views which could be, and in many instances are, of great value to the Parliament and to the people of Australia. In this Parliament, which is supposed to afford opportunity for the expression of democratic views, Opposition members should be at liberty to speak without being subjected to insults if they do not express views similar to those of Government supporters. Speaker after speaker on the Government side has thrown insults at the Leader of the Opposition (Dr. Evatt). I had the great privilege of attending the tenth session of the United Nations General Assembly as an Australian delegate, and I returned from that meeting having formed the opinion that the right honorable member for Barton, who was one of Australia’s first representatives at the United Nations organization, is still held in very high esteem by persons who have been associated with that organization since its inception; indeed, the organization itself has paid great tribute to him. But, day after day, during this debate, insults are thrown at the right honorable gentleman. Many men who have criticized and condemned his efforts during the difficult early stages of the organization’s existence know very little of the grand work that he accomplished.
Irrespective of any insults that might be hurled at me or at the party to which I belong, I have no hesitation in saying that I wish to see every nation of the world, be it republican China or Japan, become a member of the United Nations. The honorable member for Ryan (Mr. Drury) said, in effect, “Yes, I believe that at some time in the dim dark future red China should be, or could be, admitted to the United Nations. But at the present time, it does this and that and is not worthy of membership of that organization.” If we could get into the United
Nations every country of the world, be it difficult or friendly in its approach to that organization or to the economy of the world, is it not logical that we would have a better chance of getting somewhere? It is for that reason that 1 advocate the admission of all nations to the United Nations organization. Who are we to say that the Government of republican China, with its population of 600,000,000, is not acceptable to the world as the Government of China? We have the strange and stupid situation in which the United States of America recognizes the Government of Nationalist China, with its population of 10,000,000, but the United Kingdom, for its own purposes, recognizes the Government of republican China. I hope that the day is very close when the people of republican China will be represented at the United Nations. I believe that it would be better for the world if republican China and the other countries that are not already members became members of that great organization to which I pin my faith. I have no doubt that, if it had not been for that great organization, we would have been faced with a third world war long ere this. The world is passing through a most difficult period, and we will not cure its ills by blackguarding this country or that country. We will not cure the ills of the world by sending troops to Malaya, nor will we cure them by describing as a Communist any person who disagrees with any of our views. We will not cure the world of its ills by such shortsighted policies. Australia made a mistake in sending troops to Malaya. I do not know just what it has cost the Australian people to send our servicemen to Malaya and to maintain them there. We are told by Government supporters and by the Minister for External Affairs that Malaya is kindly disposed towards our troops, and happy that they are there. Frankly, I do not believe that. I do not believe that we can promote friendship and good feeling in any country, in a time of peace, if we send troops to that country. I suggest, as I have suggested previously in this House, that if the money provided by the Australian taxpayers to maintain our troops in Malaya had been used in providing food or some form of education for the Malayan people, we would have gained more sincere friendship, and the money would have been expended to far better effect. I suppose that because I’ make that statement I shall be branded as a Communist by Government supporters. Well, I must take that risk. I believe that in a foreign affairs debate we- should be able to say these things and not be insulted or accused of being Communists.
The world to-day is going through a difficult per;nfl, and the international position is serious. The honorable member for Ryan criticized the Russian representatives at the disarmament talks because they would not accept the suggested system of aerial inspection. When I visited Japan in 1946 I saw there, before any other member of this Parliament saw it, the devastation that was caused by the atomic bombs in Hiroshima and Nagasaki. On my return I said in this Parliament that I wished I could take all the peoples of the world to see the results of the explosion of those bombs. I was quite convinced that, if I could show those things to- the peoples of the world, there would never be any talk1 of a third world war. I can visualize now the devastation I witnessed at Hiroshima a few months after the bombs were dropped - and these were only experimental bombs: I remind honorable members of these things to-day because- there is still’ talk of rearmament in many countries. I do not blame the Australian Government alone, or the Australian people, for lack of action to secure peace. All governments that really believe that a third world war will end civilization must not let up for one- moment; whatever their feelings might be regarding communism or any other “ ism “, in their attempts to bring- the peoples of the world together, and to ensure that there shall never be a third world war. In Hiroshima in 1946 I saw an area of 10 square miles in which not one building was left standing. Many thousands of Japanese were killed by that one experimental bomb, and for long weeks and months after the explosion many thousands more’ died because they had come in contact with the lethal rays released by the explosion of the bomb; Is it any wonder that when I returned I said to the Australian Parliament and the Australian people that there must never be a third world war? Although we might have believed, after the Geneva conference in September, that we were coming closer to disarmament, I still think that the efforts made at that time were not great enough. The Russian representatives refused to accept the method of aerial inspection, which method I believe is entirely wrong. I stand by the appeal that I made in 1946, when T said, “Let us have total disarmament “. I made that appeal in the days after Germany had been completely destroyed, and after Japan had been totally destroyed as a fighting force. I said then, “Let us have total disarmament, enforced by an international police force “. I suggested not an aerial, inspection, but an international police force with the right to make inspections in every corner of every country.
Me. Opperman. - What weapons would it have ?
– My friend, the honorable member for Corio, asks what weapons it would have. I do not understand what he means. That is the type of interjection to which I have raised objection, especially when it is made at a time when a speaker is speaking seriously on a serious subject. I remind honorable members opposite,, who smile and giggle-
– I am, not. smiling.
– Oh, yes you are. If a third world war breaks out,, it will mean the end’ of civilization. If I cannot strike fear in the hearts of supporters of the Government who still talk communism and all the other ,c isms “, but do not get down to the real fundamentals, at least I want to remind the Australian people of the great tragedy that would result from a third world war.
– Does the honorable member still suggest, the establishment of an international police force i
– There must be a determined effort to bring peace to the world. I hear honorable members saying “ Hear, hear ! “, but at the same time we hear speeches from honorable members who tell us that we should not accept as a member of the United Nations a country with a population of 600,000,000 people. Yet, we agree to a country with a population of, say, 10,000,000 people being accepted as a member. Japan is not yet a member. If we are as eager for peace as the speeches we hear from day to day would seem to indicate, we must cease talking about some time in the far distant future when this or that country may be accepted as a member of the United Nations. I pin my faith to the United Nations organization.
Mr. ACTING DEPUTY SPEAKER (Mr. Freeth).- Order ! The honorable member’s time has expired.
.– The honorable member for Adelaide (Mr. Chambers) concluded his speech by stating that he pinned his faith to the settlement of differences by conferences around a table. As I listened to him, T wondered why the Labour party had not adopted that means of settling the serious disputes within its own ranks. The party would do well to put into practice the beliefs it professes in this chamber.
The statement of the Minister for External Affairs (Mr. Casey), now before the House, raises three questions in my mind. Although I cannot find an answer to them, I believe that the Government should consider these, three matters. But before dealing with them, I wish to comment on the excellent survey of international affairs given to us by the Minister, and on the high standard of the debate that has taken place on it. I have listened to other debates on foreign affairs in this chamber, and it seemed to me as I listened to those who have participated in this debate that members have displayed a greater knowledge of condition? in other countries than was shown on earlier occasions. It is evident that a great deal more interest is now taken in happenings in countries outside Australia than was the case previously.
The first question that arose in my mind as I listened to the Minister for External Affairs was how these various f tacts, such as Seato and Nato, can be inked together. There is a multiplicity of pacts linking the new democracies with the old democracies. We have the North Atlantic Treaty Organization, the South-
East Asia Treaty Organization, the Baghdad pact, the Anzus treaty, and so on. Because of the extreme pressure that is being applied by Russian imperialism I believe that there is danger of a chink in our armour being revealed. We should link these pacts together, in order to strengthen them and prevent any division which would tend to weaken their effectiveness. It should be remembered that these pacts are economic as well as military and are designed to protect the signatory nations against subversion, and therefore it is desirable that the knowledge and experience they have gained should be shared among all of them. This is a matter which, in my opinion, should be considered by the Government in collaboration with the governments of all the other parties to these pacts.
The next question that arose in ray mind was how we could regulate the granting of aid to countries which are outside these pacts. Some very important countries are not signatories to those pacts. For example, India and Egypt are not included. What is happening is only natural, but it reveals an extraordinary state of affairs. Some of the countries outside these pacts are bidding one power against another; in particular, they are bidding Russia against the Western democracies, and by so doing they are profiting enormously. Egypt, for example, is rearming its forces with Soviet aircraft, including M.I.G. fighters. Then Egypt went to Britain to obtain plans for its Assuan dam, and to the world bank for money to carry on the work. Egypt arrested 65 Communists, and the next da, a trade mission landed in Egypt from Communist East Germany to advise on methods of economic development. The next day Egypt bought a steel works from Hungary. It is easy for a country that has no great responsibility to play one power against another if by so doing it ran derive a substantial benefit. We should not, however, try to outbid Russia for the affections of these countries, but should find some way to regulate our gifts, and our economic assistance to them.
The third question that I raise relates to the training, under the Colombo plan, chiefly of Asian students and technicians in Australia. It is my belief that we are training too narrow a section of the Asian community. In addition to those we have accepted for training, we should be training business men, because they will play a vital part in the recovery and building up of these Asian countries. Moreover, business men form a stable bloc in the community; they are not likely to be carried away by dreams of power as other sections may be. We know that it is very easy, under a democratic system, for subversive forces to arise, and for a man to seize the opportunity to sell his own country if by so doing he can secure a position of power and prominence. That lias happened in the past, as honorable members know. In the new democracies there is a great temptation for puppet regimes to be established. Should l.li.’it happen, they will get into the hands of the technicians and professional men that Australia and other western countries are training. Therefore, I say that we should train business men also from those countries. We should devise ways and means of bringing a larger proportion of suitable trainees into this country, and should allow them to engage in industry. If we went further, and encouraged them to return to the new democracies and establish branch industries there, that would assist in the development of a strong economy, and at the same time strengthen our bonds of friendship with them. Already, Australia has expended 700,000,000 dollars in granting aid to these countries, but it must be practicable t.o expand that aid into a wider field as, for instance, by establishing branch industries in them, and encouraging them to employ their own nationals who have been trained in our business houses.
One of the illusions which has been revealed during the debate is that we exist in this world under a rule of law. That is not so at all. The only force that the world recognizes is brute force. All those new countries have been established and are maintained under thi protection of the military might of the Western world, and they know it full well. If it were not for our military strength, all these new countries that have achieved self-determination and thrown off the bonds of so-called colonialism would go overboard to-morrow. Their present leaders know that, and they arc not likely to accept the socialist dog-collar. They are not likely to sell out their countries. Their only danger is that they could be overthrown by subversive forces operating inside the framework of democracy. And, speaking of democracy, I think it should be quite simple and quite plain for every one to see that there are only two systems of government in this world, which are at two poles. We have democracy, and we have socialism. There is no in-between; no grey; we have black and white; democracy and socialism.
– Or blue and red.
– Yes, or blue and red. Under socialism, the liberty of the individual is subordinated to the interests of the privileged class who control the State. That is a very simple definition, and it is extraordinary to me that it is not accepted by every honorable member in this chamber. There is only one reason why the Australian Labour party will not accept it, and that is that it is written into its constitution, and they seek to achieve it themselves. That is socialism. On the other hand, we have democracy which grants every individual political equality, and, therefore, the maximum liberty. [Quorum formed.] Now that a few more members of the Opposition are present, I should like to repeat those two definitions. The definition of socialism is -that it is a principle under which the liberty of the individual is subordinated to the interests of a privileged class who control the State. Democracy is the system which grants every individual political equality, and, therefore, the maximum liberty. Those are the two rival systems. At the two poles, we have the great powers who advocate those systems. All those new countries that have recently achieved their independence shelter, as I have said, under the guardianship of Western democracies. Their freedom would not last two minutes if it were not for the military might of the Western Powers.
The democratic form of government is especially vulnerable to subversion, as the Minister for External Affairs has pointed out. One of the virtues of these treaties is that they allow member nations to collaborate, and work out means of combatting subversive activities within their own borders.
I do not wish to speak any longer on this matter. I shall merely reiterate the questions to which I believe that the Government and the Minister for External Affairs should give some consideration. First, the fact that these pacts are not linked together in any known way. They are apparently linked on a military plane by the chiefs of staff, but on every other plane, including the economic plane, there does not appear to be any common machinery. I think it is important, in view of the tremendous pressure from Russia in the field of subversion, that machinery should be created for linking all these countries together. The second question is the regulation of aid to countries that lie outside these treaties. I believe that we should not aid them unduly but, at the same time, we must give them some aid in order to prevent them from going Communist. We should not aid them unduly because, in that way, we would be bidding against Russia, and they can play that game indefinitely. They must accept some responsibility if they are to accept our aid.
The third question that I raised was that of the business training of a wider section of the community in these Asian countries, so that we shall have friends in a wider field in these countries and so that they will be made stronger and their democratic systems will be more robust. I do not think that a democratic system, founded on the skill of professional men and technicians, allied to an immature political public, is a very stable form of democracy. We have our own troubles in this country. Even with a high level of education and civilization, we have very serious trouble in maintaining our democratic balance. How much more so have these young new countries in Asia difficulties in understanding what is meant by freedom of the individual, the rights of the individual and free speech - things we take for granted ! If we are able to share our business knowledge with Asians and if we are able to set up business houses in these Asian countries, employing their nationals, I believe that we will help them far more than we are helping them at the present time when we are giving them grants of money to disburse as they themselves see fit.
It would be much better for us to take a long-range view of this matter and encourage industries to grow up by degrees.
I do not think it can be said too frequently that the strength of the democracies is vital to the preservation of these new countries. They have achieved self-determination. That has satisfied their ambitions in that direction, and most of them are realistic enough and sensible enough to accept, willingly, collaboration with the West in the military and economic fields, in order that they may progress from the backward stage of colonialism until they become strong and powerful nations in their own right. A great deal has been said in the course of this debate against colonialism, and I am amazed at that. I am astounded that any one should find fault with the system of colonialism. It was absolutely necessary in the stage of history through which most of these Asian countries passed. It has brought them immeasurable benefit in the way of health, sanitation, knowledge and wealth, lt has brought them better living conditions and an opportunity to live a fuller and happier life. That is really the fruit of colonialism, and I see nothing whatsoever wrong with it. Australia is still a colonial nation, with colonies under its control. What would be the position if an insurrection occurred in New Guinea, incited and encouraged by Communists, and Australia was offered help from the United States of America or Great Britain ‘. Would we refuse that help to suppress a Communist-led uprising in our own territory? Of course we would not. We, and the New Guinea natives would welcome it with open arms. That is precisely the situation, as I see it, in Malaya.
– It has been interesting to hear the remarks of the honorable member for Gwydir (Mr. Ian Allan). His definitions, to say the very least, could be described only as confusing. What an incredible interpretation of the Australian Labour party’s objective of socialism was given by the honorable member! Apparently, he has some distorted view of socialism because he considers that it means that the welfare of the individual is subordinated to the privileged classes that control the State. That belief is quite unfounded, and is not supported by the facts. If the honorable member for Gwydir is suggesting that the privileged classes under socialism are those people who toil and
Contribute to the wealth of their country and the uplift of the peoples of the world, there is some substance in his definition. There is no question that when socialism is achieved, if there is a privileged class in control of the State, that class will be made up of the masses of the people.
It has been interesting to hear the contributions to this debate by the honorable member for Gwydir, which I have just summarized, and the honorable member for Adelaide (Mr. Chambers) who spoke in a most inspiring fashion after having visited the scene of the atomic disaster in Hiroshima. He suggested that the hope of world peace was associated with the forthcoming activities of the United Nations organization. He emphasized the need for conciliation, co-operation and understanding. He was followed by the honorable member for Gwydir, who remarked on the faith of the honorable member for Adelaide in conciliation. He could not understand, he said, why the Australian Labour party had not the .same sort of faith in conciliation as applied to the industrial front in Australia. I do not know what is the attitude towards conciliation of the honorable member for Gwydir, or that of the party he represents, but the Opposition in this House feels strongly that there are tremendous shortcomings in the present arbitration and conciliation system as applied to the needs of the workers of this country, and that it is high time that it was overhauled.
I doubt “whether the honorable member and his party consider that the facilities of the United Nations organization are insufficient Or need to be overhauled. It is apparent that the United Nations organization is well established. Mr. Benjamin Cohen, who was a counsellor of the Department of State of the United States of America for nine years, and for four year- a member nf his country’s delegation to the United Nations organization assembly said’ -
It is one df the basic principles laiS down in the existing Charter -
That is, the United Nations Charter - that neither force nor the threat of force shall toe used ‘by Member States in their international relations in any manner inconsistent with the purposes of the Charter. The Charter has not been rendered obsolete by the discovery of atomic weapons. Effective disarmaments arrangements are not .excluded by the Charter, but are necessary to carry out its stated objectives.
He went on to say that the provisions of the United Nations Charter were full and adequate to deal even with the scourge of atomic war. It is refreshing to listen to speeches such as those by the honorable member for Stirling (Mr. “Webb) and the honorable member for Adelaide in contrast to these of the honorable member for ‘Gwydir and others who have contributed to this debate. Honorable members on this side have adopted a practical attitude, whereas honorable members on the Government side seem to be more intent on creating disturbances and trouble than on making contributions to the uplift of living standards throughout the world and the solution of difficult problems.
The honorable member for Ryan (Mr. Drury) seemed to be keen on the recognition of a fifth column which, he alleged, is operating in the Union of Soviet Socialist Republics, and he said that the Government should do what it could to assist that underground movement. It seems incredible that a responsible member of any government party should make such an indiscreet remark, at a time when a highly inflammable world situation exists, a remark Which could be responsible for provoking trouble that could result in world-wide disaster. His suggestion that Australia should do its utmost to further the activities of the fifth column operating in the Union of Soviet Socialist Republics is almost equivalent to tearing “up the Union of Soviet Socialist Republics flag in the main street of Moscow. No doubt the people of Moscow would react in the same way that Australians would if the Australian flag were torn up in Martin-place^ Sydney. It is unbelievable that the honorable member should say Such a thing when so many features of ‘the international situation demand a sympathetic attitude.
The great desire of the ordinary people throughout the world is that, despite grave international contentions, the conflict of ideologies, and the territorial and economic designs of one people against another, peace should prevail. Theretore, we should be intent on doing something about the question of disarmament. This matter was glossed over by the Minister for External Affairs (Mr. Casey) in his recent statement to the House, and was not given the significance and importance that it deserves. The disaster of Hiroshima was referred to this afternoon, and this is an ideal opportunity to refresh in the minds of Australians the memory of that terrible event. For that reason, I propose to follow the lead given this afternoon in the speeches of the honorable member for Stirling and the honorable member for Adelaide. There is no doubt that when the atomic bomb was exploded at Hiroshima in 1945 it had the effect of imprinting indelibly in the hearts of the people of the world a great fear for the welfare of mankind and the survival of their families.
– Why did not Russia disarm then, when it had the opportunity?
– Over the years, men have been fighting with swords to kill one another, and little progress has been made towards lasting peace. lt seems that the attitude of honorable members on the Government side is that no progress should he made towards peace, despite the .fact that we have at our disposal the means to Gxter.mi.ua.te mankind.
– Why does not the honorable member answer the question just asked?
– It is hard to answer any question asked by Government members ‘because of -their “ mumbojumbo “ attitude. They are not capable of expressing a clear-cut opinion, and they resort to interjecting in a lewd sort of fashion which does not bring credit oh this House
– I rise to order. I interjected, and the honorable member suggests that it was in a lewd fashion. I ask for a withdrawal.
-Order! All interjections are disorderly, but I think the honorable mem ber for Hughes (Mr. L. R. Johnson) will agree that his description of the interjection is a little strong, and I suggest that he withdraw it.
– I am certainly happy to withdraw that description and replace it with the word “ crude One cannot feel that the interjections by Government members are either inspiring or desirable. There is no question that the innovation of the hydrogen bomb a short time after the detonation of the atomic bomb gave rise to circumstances which further aggravated thi3 position. No longer can we go on leaving unsolved this great problem, which is plaguing the minds of the people. So much has transpired since 1945 in the endeavour to give expression to the widespread anxiety that is shared by the people of the East and the West, of every colour and creed, and equally by our own countrymen, that it would be the height of indiscretion and folly for .any one to do or say anything that would impair the progress made.
I ani sorry to observe that the Minister for External Affairs .has dismissed in a few brief words the earnest endeavours made .by the various members of the United .Nations over the last decade, and the humanitarian submissions of the great statesmen of the world, who have been desperately grappling with the problem of disarmament and have made tremendous headway. He has dismissed lightly all those efforts, and has, I think, underestimated the importance of the things achieved. The Minister has dismissed this subject in the same offhanded way as he .might dismiss a proposal that he should have .two eggs for breakfast instead of one. This question is apparently not important to him at all, and he just makes some casual reference to it and pretends that nothing has been achieved at Geneva. But the matter is not to be dismissed so easily. The Minister said -
The next question before the .Foreign Ministers in Geneva was disarmament. There, too, practically no progress Tins “been made either in Geneva or elsewhere.
Apparently the Minister has had little concern with what has gone .on since 1945. Though so many conferences have taken place among so many earnestly inspired people, the Minister simply brushes the whole thing off by saying that the next question before the foreign ministers in Geneva was disarmament and that practically no progress was made. If his statement that no progress was made either in Geneva or elsewhere were correct, I do not feel that it would be his responsibility or his obligation to come here and crow about it.
The fact is that the people of Australia want to know why there has not been sufficient progress, and they want to know in no uncertain terms what the Government intends to do. The people of Australia are intent on the prospects of peace, not war-mongering, and they are certainly intent on the prospects of universal disarmament. Many thousands have been signing petitions on the subject, but the Minister brushed them aside in his statement. He talked about the likelihood that Communists will circulate petitions, and that their cry would be for the banning of the atom bomb. “We are highly hopeful that the Government may come to understand that that is the wish of people everywhere, not merely the Communists. We hope that one day acceptance of the prospects of peace will become a virtue of this Government.
The question which exercises my mind and the mind of many other honorable members in this House is: What contribution is the Australian Government going to make towards this end? Does the Government believe in, and subscribe to, a policy of universal disarmament, or does it prefer to qualify its attitude with such a conglomeration of side issues that its attitude is indiscernible? That, apparently, is the position which prevails at the moment. What the Government proposes to do about these things is quite unclear. The contradictions right throughout the Minister’s speech indicate the state of mind of the Government. For example, the Minister said that Australia was fairly playing its part in the endeavour to achieve international disarmament, even partial disarmament, to rid mankind of the threat of destruction through nuclear weapons. One would accept that as a clearly defined attitude on the part of the Minister, but there was no question of the Minister’s attitude when he said, under the heading “ Estimate of probabilities “ -
There is not much likelihood of a global nuclear war breaking out in the near future. However, this is only true so long as the democratic nations can demonstrate that they are both able and willing to resist aggression.
And so the contradictions go on. Under the heading, “ The problem of armaments “, the Minister said -
It is clear that, in the face of the Communist offensive, an essential part, though by no means the only part, of the free world’ r, strength must be armed strength.
So the speech goes on, with many statements which take an irreparable toll of the disarmament proposals that, over a period, have emanated from both the Ea.it and the West. It is clear that if any proposed agreement on- the banning of nuclear weapons is to be seriously considered, it should be based on practical proposals capable of fulfilment. It is equally clear that, and as far as is practicable, they should be supplemented by arrangements designed to provide for satisfactory and routine inspection facilities. While the onus would, of necessity, be fairly and squarely on those participating, there is an obvious need to set uo a representative organization upon which the onus of regular inspections would be laid.
What has been done ? Tremendous contributions have been made towards a practical working agreement on the part of member nations and it is high time that this Government set out its attitude. Surely it is a case of knowing what one wants and then going after it. What does the Government want? Its befuddled and bedraggled attitude is pointless and endless, and it is not heading in any particular direction.
Four courses, stand out clearly enough, if this Government is intent on full or partial disarmament. The Minister for External Affairs should have some inspirations on this matter, as is evidenced by this extract from his statement -
The vast expenditure on armed forces a 11. armaments throughout the world is one of the ba.sic problems of our time. The world is oppressed with a burden of warlike preparation. In the hydrogen bomb, there has been developed for the fi rft time a weapon capable of mutual obliteration.
If we are so obsessed with the problem as appears from the terms of this statement, what do we propose to do about it? First, we could pursue the proposals that were submitted by the Western Powers. Secondly, we could become attracted by the proposals submitted by the Soviet Union. Thirdly, a compromise attitude might be considered worthy of investigation. Fourthly - but this is most unlikely - this Government might have some fresh and original ideas on the matter.
The United Nations has made tremendous progress in the problem of disarmament. We reached the stage where certain proposals were made by the Soviet Union and others by the nations of the Western bloc. Great controversies raged, and after a certain deadlock period, free, clear and concise attitudes were revealed by the two parties concerned. On the one hand, the Western plan proposed this sequence of events: First, the establishment of a control authority; secondly, the reduction of conventional armaments and armed forces; and, thirdly, the prohibition of nuclear weapons. The Soviet Union, naturally enough, opposed that sequence in the same manner as the Western bloc opposed the sequence of events proposed by the Soviet Union. The Soviet claimed that the West would become aware of all Soviet secrets if it succeeded in establishing a control authority first,” and further that there would be a reduction of Soviet armed forces and conventional arms but no restriction of nuclear weapons. On the other hand, along came the Soviet proposals, which were intended to reverse the sequence. The Soviet proposals provided for. first, prohibition of nuclear weapons, and secondly, for the reduction of conventional armaments ; thirdly, they opposed the control system. So the deadlock went on, with the nations at loggerheads over the proposals, for some considerable time. But it is significant that the Minister for External Affairs should have disregarded what has happened in the past. Very intense efforts have been made, and now we have reached a stage where various proposals have been submitted by the nations, including the Union of Soviet Socialist Republics. We have reached a most delicate stage, and in those circumstances it appears most. undesirable that there should be such provocation as has been evidenced by the attitude of members of this House this afternoon. We on this side of the House feel that to indulge in such provocation is like trying to walk through a fowl-yard covered with egg-shells without breaking any of the shells. We trust and hope that the indiscretions which have characterized the attitude of Government supporters in this debate on international affairs will not be continued, that they, like us, shall observe the tremendous progress that has already been made, and that Australia will be able to assist to further these achievements so that the world may avoid the prospect of another war.
– Order! The honorable gentleman’s time has expired.
.- The honorable member for Hughes (Mr. L. R. Johnson) has revealed an alarming lack of responsibility in his reading of the ministerial statement on international affairs. The lower half of page 7 and the upper half of page 8 of the roneoed copy of the ministerial statement, which was circulated to all honorable members, is devoted to disarmament. I suggest that the answers that the honorable gentleman has stated he seeks will be found in those pages.
I wish to direct attention to the circumstances that have prevented the United Nations from achieving the world peace for which we all so fervently hope, and the consequential need for the development of regional defence pacts. Many people have come to the conclusion that the League of Nations was a failure, and, looking at the matter objectively, they may regard that conclusion as sound. I do not. I regard the League of Nations as having been the first stage of a grand experiment ; I regard the United Nations as the second stage of the same grand experiment. Regrettably, whilst the United Nations organization has a greater number of members than the League of Nations had, it is still prone to the faults that surrounded the creation and the operation of the league. Unfortunately, the attitude of nations has not changed since the- days when the League of Nations- was in existence. They have been unwilling to- submerge some, aspects of their national sovereignty for the common good. Examples of this are to be seen in the attitudes- respectively of South Africa and Holland. They have chosen to invoke the provision in paragraph 7 of Article 2 of the United Nations Charter, which reads -
Nothing contained in- the- present Charter -shall authorize the United Nations, to intervene in matters, which are essentially within the domestic jurisdiction of any state or shall require the Members to submit such matters to settlement under the present Charter; . . .
The nations have been unable to submerge self-interest, and in this respect I point particularly to the power of veto in the Security Council, which grew out of the concept that peace depends on the unanimity of those nations that have the power to wage modern war, and the inferential concept that the five nations that have that power will be unwilling to negotiate an agreement whereby any one of them could be coerced. It seems, and indeed it has been suggested by a critic of the United Nations, that the organization was designed, not to police the Big Five, but to police everybody else. Then, of course, the nations have failed to eliminate prejudice. This is clearly evidenced by the back-room bargaining which went on in relation to the selection of the original secretary-general of the United Nations, and the fact that, when another secretary-general had to be appointed, that same kind of bargaining was intensified. It is further evidenced by the requirement of the Charter that in matters of staff they will be selected according to a numerical formula, in order to ensure equal representation of all nations proportionately in staff of the United Nations organization. Ability is not the principle which guides the selection of staff.
Unfortunately, the composite attitude of the nations has not changed much since the demise of the League of Nations. There is no greater evidence, since the failure of the league, of a capacity of nations to submerge their interests and prejudices for the common good. Distressingly enough, the very converse of that is shown by a populous, powerful nation, the Union of Soviet Socialist Republics, the very essence of whose political concepts negative the sub mergence of national interests. That nation wishes to impose its will on others, and aggressively pursues the doctrine of class warfare. Of its own volition it has rendered impossible the achievement of international amity through supra national organizations. I do not wish to imply that the principle of the United Nations, is necessarily thereby negated or that its role is less worthy, because we know of the vast sphere in which tha agencies of the United Nations have interested themselves, and that they have already achieved lasting and worthwhile results. Further, the organization is building up a tradition, of internationalism. It is founding the corporate experience which will be so necessary for the transition of a world body- of conciliation into a world parliament. If those principles of the United Nations are so limited, given the existence of a populous and powerful nation unwilling to participate in the precept? of the United Nations, without reservation, wherein lies our salvation and the dream of unending peace? They must lie in one of two possibilities - first, disarmament; or, secondly, regional defence pacts. Unfortunately, the history of disarmament is distressingly full of examples of dishonesties, and of the failure of reason, accompanied by undisguised manifestations of adherence to national self-interest.
The transcendent consideration ha? always been reduction of armaments. 1 am not aware of a single movement for total abolition of armaments that has been given even nominal consideration in international discussions. In all cases it has been the purpose of one or other of the parties, by smart talk or other means, to emerge from disarmament conferences in a more favorable position vis-a-vis other nations. It has always seemed to me that movements towards disarmament have put the cart before the horse. We cannot secure peace through disarmament, we can achieve disarmament by securing peace.
What of regional defence pacts? They are not contrary to the spirit of the United
Nations organization, and I support that contention by quoting paragraph 1 of Article 52 of the Charter which reads -
Nothing in the present Charter precludes the existence of regional arrangements or agencies for dealing with such matters relating to the maintenance of international peace and security as are appropriate for regional action, provided that such arrangements or agencies and their activities are consistent with the Purposes and Principles of the United Nations.
So that a regional defence pact aimed
At the preservation of peace is in no way contrary to the principle or spirit of the United Nations. In fact, it is the reverse, because the preservation of the United Nations organization can be assured only by the presentation, to a would-be aggressor, of a joint resolve to pursue a course of self defence and a common purpose to retain the liberty, that we may, if we wish, cede to a supra-national body such of our corporate sovereignty as may be necessary in the future when the threat of one ideology no longer threatens peace, and the times are propitious for the creation of a truly representative world parliament.
At this point, I wish to emphasize that a gallup poll conducted in Australia has revealed that the majority of the Australian people favour the development of the United Nations into a world parliament. Regional defence pacts are not contrary to the spirit of the United Nations, but they may readily be categorized into two types. In the current terminology, there are pacts with teeth and pacts without teeth. Nato is an example of the first type, pacts with teeth ; and Seato is an example of the second type. It does not mean that, necessarily, one is more desirable than the other, because much depends on the circumstances of their evolution.
I point out to the House that Nato, for the greater part, is composed of nations that are mature in the ways of government and secure in the retention of nationhood. They have had vast experience of intercourse with other nations. To them, defence against external aggression is the major single object, and their capacity to submit their resources to a unified command flows from their sophistication. But even now, since the easing of, the crisis which precipitated the formation of that treaty, there is evidence of a less ready acceptance of submission to a unified command, and it is indeed a problem which confronts the Nato Council and the Secretary-General, Lord Ismay, to this very day - how to reconcile this reluctance to continue the unified command, and the maintenance of large standing armies, with the necessity to retain defence dispositions.
Seato, on the other hand, is composed of nations - and nations whom it is hoped to attract into the pact - whose nationalism is buoyant, and who have not enjoyed their state of nationhood for a sufficiently long time that it is accepted without question. Furthermore, of course, there is the fact that their internal organization would not readily lend itself to standing dispositions of troops under a unified command. So it is that Seato has been criticized on the ground that it lacks teeth. It is my opinion that this very apparent lack of teeth is its strength. It is designed to inculcate co-operation and foster trust, and while it does so, it can form a great part of the bulwark against aggression from the north from that same ideology which will not submit to the principles of the United Nations. The other objection to Seato is that voiced by Nehru. His objection is on two grounds. First, he alleges that it will disrupt the Geneva Agreement; and, secondly, he maintains that it will reverse the process of Asian liberation from foreign imperialist control. Those words might well have been spoken from the other side of the House.
Unfortunately, the complex of colonialism in Asia is still very strong, and it deters Asian people from entering into agreements or treaties which are likely to result in the creation within their territory of standing bases and military establishments. On occasion, even where an economic aid post is established within Asian territory, there seems to be the fear that it is merely a political outpost. Seato is a regional treaty which, while in no way contrary to the principles of the United Nations, can, by the inculcation of the need for cooperation - an example of such co-operation was seen in the recent exercises off the coast of Thailand - and the development of trust, show to the Asian people that we have only a common endeavour for peace and security, and that we have in no way any designs upon Asian national development. In that form. Seato is a most valuable treaty and one to which we should contribute great efforts to maintain and develop its principles.
I have spoken of the attitude of the Asian people. I feel that my remarks could be better summed up by the words of Sir Robert Holland in an article which was published in the winter 1955 number of The Dalhousie Review. He said - lt lias to be remembered that a group of peoples, plunging into independence through self-determination, may not achieve stability as a veritable sovereign state unless what President Roosevelt called “ the periods of preparation and training “ have been successfully completed: preparation, by the dissemination of education, and by planning for social and economic betterment: training, through the practice of more and more self-government in the various steps leading to complete statehood. If internal solidarity is lacking, there will be small appreciation that “ interdependence “ of neighbour states is essential for prosperity and for survival.
In consequence, I feel that Seato should develop in this form, without teeth in the apparent sense, as an arrangement which depends principally on the development of trust and co-operation. But Seato is not purely a military pact. It has also an economic aspect. Article III. of the pact says -
The parties undertake to strengthen their free institutions and to co-operate with one another in the further development of economic measures, including technical assistance, designed both to promote economic progress’ and social well-being and to further the individual and collective efforts of governments towards these ends.
In my opinion, there are three other pacts in association with Seato. There are the Canberra pact, which was formula ted between Australia and New Zealand, and which provides for consultation and joint action; the Anzus pact between New Zealand, the United States of America and ourselves; and very importantly, the Colombo plan. I feel that, by the active pursuit of the aims and principles of these four pacts, we in Australia can become a considerable force in the preservation of world peace and in the creation of a state of amity which will enable the formation of a supra-national body such as we should like to see and such as the gallup poll to which I have referred indicates the majority of the Australian people would like to see.
There is a final point which I wish to make. We have in Australia a diplomatic service which has proved itself able in the past and is every day proving itself even more able. I should like very much to see the Government extend the diplomatic service so that we might be represented in every country of the world, and so that we might be represented by highly trained artisans in the art of diplomacy. We know that other nations have a longstanding history of diplomacy, and that the corporate experience has been passed on from one inductee into the diplomatic service to another, so that, gradually, honesty of purpose and loyalty to the spirit of international affairs of the government which directs the service becomes the overwhelming principle. That spirit is ‘ rapidly accumulating in Australia. I feel that the continuance of this spirit, so ably displayed by the present Minister for External Affairs (Mr. Casey), together with adherence to the four pacts I have enumerated, will create for Australia a position of trust and make this country welcome in the councils of the world. -In such a position we could put our case frankly and firmly. Our representatives then could say, “ This is what we believe and this is what the nation believes “. Such a declaration would be soundly interpreted by other nations in the sense in which -it was given and would, in no way, give offence.
.- In the international sphere, Australia has a two-fold part to play. The first part is individually and in our capacity as a self-governing nation; and the second, collectively, as a member of the British Commonwealth of Nations and the United Nations, and as a participant in various pacts. We owe our first duty to ourselves, but it seems to me that that is something which this Government and our globe-trotting Minister for External Affairs (Mr. Casey), in his meanderings round the world, have overlooked. There seems to be too much subservience to overseas interests by this Government. It tends to be too apologetic for the Australian way of life. One Minister devoted practically the whole of his speech to a discussion of the virtues of Great Britain - to which we all pay tribute - but he did not mention Australia at all.
Labour believes in collective security. It demonstrated its sincerity in that regard during the war and during the postwar period. We well remember the late John Curtin’s famous appeal to the United States of America, when his Government was accused by people on the other side of “ cutting the painter “. We remember that the present Leader of the Opposition (Dr. Evatt) appealed to the United States for aid in the provision of munitions. We remember also his part in framing the charter of the United Nations and in negotiating the Anzac Agreement. Australia has played a not inconsiderable part in the councils of the nations, in the various collective bodies. It is gratifying now to see that an anti-Labour government is following the lead of Labour in international affairs. The policy of the antiLabour parties, whether in the sphere of international affairs or in the sphere of social reforms on the home front, is to oppose Labour’s proposals in the first instance, but to adopt them later.
The important fact that we must bear in mind is that Australia’s part in international affairs has been mainly an exercising of influence. After all, our armed Strength is infinitesimal. We should not delude ourselves in that regard, nor become obsessed with the idea of our own importance. We should turn the binoculars back, so that we can see ourselves in the right perspective - as we appear to others. It would be a fatal error to rely on others to come to our aid in every emergency. It has been said before in this debate that Australia, as a white country in an Asian world, is in a unique position. Racially, we are of the West, but geographically we belong to Asia. No amount of wishful thinking on our part can disguise the fact that, as the occupants of a sparsely populated continent contiguous to the teeming masses of Asia, we have our own special problems. We cannot escape from that situation. We cannot avoid the probable or it may be, the inevitable consequences. lt would be foolish to rely upon others always to come to our aid. In World War II., Japan and Italy, countries with which we had been allied in World War L, became our enemies. In balanceofpower politics, which Great Britain played in the past - we traipsed along behind, tied to its apron strings - the scene changes quickly. The Middle East to-day is a seething cauldron. Incidents in Jordan, Greece or Israel could change the situation overnight. One incident could spark the tinder that would set the world aflame. It may be that Australia will decide to repudiate some of the policies that are being adopted in regard to particular problems, and that even Great Britain will go cold on us. It may be that we shall have to “ go it alone “, as we nearly had to do in World War II., when even Mr. Churchill, in a famous remark, said that Great Britain might lose Australia for a while, but would get it back later. That would have been poor consolation to those of us who were here then. Probably our throats would haw; been cut by the Japanese.
So we must make a realistic approach to our own special problems of defence. We have a long, almost undefended coastline. The teeming, hungry masses to the, north of Australia may be misled into entertaining a burning hatred for us as a result of what their leaders say about our immigration policy. It is, indeed, a frightening situation. We cannot afford to be ostrich-like. We must not use, so to speak, mental crutches and rely on others to pull us out of ever.) difficult situation. We must be selfreliant. We must develop our own resources and build the population of thu country quickly. We must develop h sense of urgency, without being panicky. We must stir ourselves from our complacency.
The sleeping giant of Asia has awakened. It has been said that he who rules or dominates Asia rules or dominates the world. The methods and techniques of Genghis Khan are being revived, in a more subtle and ruthless form. Let us not delude ourselves. Let us build our own strength, within our own shores.
Balance-of -power politics is dangerous and can rebound on those who use it. The Asian people do not appreciate being
Treated as a buffer against communism. The Minister for External Affairs (Mr. Casey) and his associates may he just a little too clever in that regard, with their -suave manners and their cocktail party diplomacy. The Asian people are not fools and are not likely to he taken in by methods of that kind. There is an old saying that nothing succeeds like success. If the balance of power were to shift, some of our present allies in Seato could turn against us. The dispute over Kashmir between India and Pakistan illustrates what could happen. The Seato pact could collapse overnight, and already there are signs that it s crumbling.
Australia is in a unique position. That position creates special problems for us. We could suddenly be embroiled in trouble with Indonesia over Dutch New Guinea - trouble which has been simmering for a considerable time. Other countries which are our allies might not see eye to eye with us on some matters. Even Great Britain and the United States might not see problems from the same viewpoint as we do. We saw an example of that in the negotiations for the Versailles treaty. We had to put up a fight to retain New Guinea, which Great Britain and the United States, under President Wilson, were prepared to hand over to Japan. If a conflict were to occur between the indigenous peoples of Papua and New Guinea and Asian immigrants, a further conflict could occur, and other nations might not be in sympathy with our point of view. They are remote from us and may not look at these problems from the same angle as we do. Great Britain has its own special problems in the Middle East, and Europe. America has its colour problem. The Old World is immersed in its own problems. We, isolated as we are. must develop o::r own national outlook and concentrate on our own immediate problem*. We must not continually meddle with and poke our noses into the affairs nf others. The Prime Minister (Mr. Menzies) admitted only to-day in relation t” Singapore that we should avoid doing so. In the light of our problems, the Minister’s statement on the international situation was a dreary, doleful document of despair and utter hope lessness, it was in keeping with the Government’s attitude both to problems on the home front .and to other problems.
Much has been said in this debate about the ideological approach to Asia and the material aid which is being given under the Colombo plan. The ideological approach is all -very well. Let us hopethat the time will come when all men will, be angelic and saint-like. But somecynics discount the Colombo plan entirely. It has been said that one never can get much in return for giving charity toother people. I do not uphold that view,, because I believe that, although some people do not appreciate material help,, there are many others who do appreciate it. These things .should be looked at in their true perspective. The grim facts of history point a warning. It has been said that man is a fighting animal. There is no doubt that the human .race as a whole is still far from fully civilized. The great majority of people are peace- loving, but there are always power-drunk individuals who try to enslave others.
In a jungle world eternal vigilance is the price of liberty. We cannot strut unarmed through the jungle spouting philosophical niceties and ideological injunctions. By all means let us maintain an ideological approach, but after all the cold war itself is a war of ideas, and psychological warfare is just as important as a conflict with arms, but that, in itself, is not enough. We have all seen how the good work of the Christian churches in Europe, and of missionaries in Asia, has been swept away because tyrants and uncivilized beings have no regard for the ideals and sentiments expressed through those groups. Tyrants recognize only strength, and our motto should he like that of the American general, *’ Trust in the Lord and keep our powder dry”. But that does not relieve us of all responsibility. We must continue to strive for permanent peace, and try to bridge the gulf in economics and philosophy that exists between the - East and the West. As the Leader of the Opposition has said, we must always keep trying, no matter how difficult or impossible the achieving of our objective may seem to be.
A majority of people in both camps are peace-loving, but that very fact makes those people an easy prey fox tyrants -and dictators. Most human beings, only learn from experience, and let us hope that the experience we have had of two world wars and of the horrors of Nagasaki and Hiroshima may bring home to us the lessons of war and make us understand what another war would entail. A third conflict might well cause the end of civilization itself. If armed conflict is not the answer to our problems, and if Christian charity is not sufficient to bring people together, we must find a third way which will allay fear, suspicion and distrust, and gain the confidence and goodwill of the Asian people.
The Colombo plan may represent one way of gaining the goodwill of Asia,, but it is a mere drop, in the bucket and, moreover, it has not been sufficiently publicized. That very fact was admitted by Sir Anthony Eden, the Prime Minister of Great Britain, and by the Prime Minister of Canada when they agreed that a certain amount of publicity should be given in the future to the Colombo plan. A little more colour might be introduced in that regard into our relations with Asia. For example, we might have little ceremonies when we are making free gifts to Asia, and not merely make the exchanges as between diplomats. Quite recently, in my own electorate, certain railway engines were to be handed over to the representative of Pakistan. On the morning before the ceremony, the manager of the firm concerned telephoned me in a state of panic and said that the workers in his factory were concerned about this matter, and were going to barge in on the ceremony. I said to him, “ Well, they . helped to produce the engines, why should they not be there ? “ And ultimately they were allowed to be there. I consider that it would be a good thing if we gave some publicity to delivering gifts under the Colombo plan to the Asians, and I think that some of our own people or some workers’ delegations could deliver the goods so that the people of Asia would know where they came from. Then, perhaps in the course of time they would reciprocate our gesture of goodwill.
However, all that is only tinkering with the situation. To ray mind the real problem facing the world, which is causing economic ills that eventually lead to war, is the maldistribution of wealth.
There is enough for everybody’s need but not enough for everybody’s greed. We are riving in a crazy world to-day. In some countries the granaries are bursting;. but according to a survey made by the United Nations, two-thirds of the people of the world are suffering from malnutrition or are near starvation. If the countries which have surpluses attempt to sell them cheaply or to give them away, there is an immediate outcry by selfish interests.
President Eisenhower, of the United States, was placed in a dilemma recently when people in his own country and other countries protested against America’s offer to get rid of its surplus products- to nations which badly required them. It. was finally decided that some of the crops were to be ploughed in or that there was to be a restriction of production. That situation 13 reminiscent of the days of the last depression when our surplus goods were burned or dumped in the sea while the masses had to pull in their belt? around their emaciated stomachs.
Trade is the lifeblood of the nation and it has been said that the flag follows trade. However, trade wars generally lead to military warfare. There is a necessity for a system of international currency, government controlled, to stimulate trade and allow a freer distribution of the world’s production and good things of life. That is something to which our economists might devote their attention - that is, to work out some form of international currency - instead of forming negative deflationary policies which they seem to be concentrating on at the present time.
The Asian nations are mostly agrarian peoples, and in some countries only 2 per cent, of the population own 90 per cent, of the land. Primary producers in those countries, like primary producers here, are preoccupied in tilling the soil, and are consequently at the mercy of the money-changers and middlemen. That was pointed out in a survey conducted in Cambodia under the Colombo plan. It was there found that farmers had no means of financing their production other than by raising money at up to 100 per cent, interest. Therefore, some form of international bank on a governmental basis to lend money at low interest rates would enable the people of those countries properly to apply themselves to production,, and so to produce a freer flow of goods. Meanwhile, until economists or governments find an appropriate monetary system we should continue to try to win the cold war with schemes such as the Colombo plan.
Mr. Selwyn Lloyd, the British Foreign Secretary, recently pointed out that the W est would have to make an all out effort to meet the Russian challenge in the world’s undeveloped areas. He said that it could not be expected that people in under-developed areas, would be very much, attracted by the sophisticated freedoms of the West. He said that the materialism of Russia might make a greater appeal, and that the promise of an extra bowl of rice a day under communism might be more attractive than to be told that under free institutions they would have the right to vote or to worship or to criticize as they pleased. I suggest that that criticism certainly seems to follow my argument.
In regard to our attitude towards Malaya, our slogan might well be “ Gifts instead of guns “. Let us endeavour to understand the East according to the eastern philosophies. Example is better than precept. Recently Mr. Grayson Kirk, the president of the Columbia University in New York, one of the most, important academic posts in the world, said that no nation had ever been influenced by gratitude, and that spending money on economic and technical aid to Asia was a clumsy instrument with which to achieve political results. I submit that a practical plan for a world currency would provide a better solution to the problem.
Mr. ACTING DEPUTY SPEAKER (“Mr. Bowden). -Order! The honorable member’s time has expired.
.- The present debate has served to illustrate one thing very clearly to the House and to the people of Australia. That is, that there is a very great gulf between the thoughts of honorable members on the Government side of the House and the thoughts of honorable members on the Opposition side insofar as the foreign policy that we should follow is con cerned. Honorable members on this side have indicated that their thoughts are concentrated mainly on attaining the future security of Australia. We want to ensure that we can hand to our children a free country in which they will be able to shape their own destinies and the destiny of the nation.
On the other hand, we have found that there are some honorable members on the Opposition side who, starry-eyed, have managed to see something desirable in communism. They see only virtues in communism and none of its faults. Some of them, such as the honorable member for Hughes (Mr. L. R. Johnson), have implied that they believe that communism, or a parallel policy, is preferable to the policy of democracy that the Government supports. Those are the persons who are prepared to throw away the system that has been evolved by generations through the centuries, and that has* enabled this young country to develop to a stage far beyond that reached in many of the older nations. That is one proof that we have the best system of government and the best way of life in the world to-day.
Honorable members opposite have suggested that we should throw all this away and take, in its place, some new philosophy which has been tried but not yet proved. That is a policy which may, in one, two or three centuries, eventually reach by evolution the stage of development that we have achieved already. Those reactionaries would go back 100 years, and then start over the course again until they reached the point that we have already attained.
The honorable member for Hughes has suggested that the Minister for External Affairs (Mr. Casey) omitted, in the paper that he presented to this House, to pay any attention to the problem of disarmament. If the honorable member had read that statement, he would not have said that the Minister had dismissed disarmament with a few words. I refer the honorable member to page 5 of the typewritten copy of the Minister’s statement. The Minister began a discussion of that matter at page 5 under the heading “ The Problem of Armaments “. At page 8, he dealt with “ The Necessity for the Nuclear Deterrent “. At page 7, he referred to “ Strength, in Unity and Co-operation “ and, under the heading “ The Realities of Disarmament “, he referred to the question of banning the atomic bomb and other nuclear weapons and the present stage of disarmament. I should say that the Minister has given the fullest consideration to the problem of disarmament.
The honorable member for Hughes lauded the suggestion that we should ban the atomic bomb. Such a proposal has been plastered over the walls of every city in Australia by Communists, who have been busy with their paint brushes in thu dark hours of the night. It has been enunciated in every Communist newspaper and on every platform on which the Communists have endeavoured to spread fear in the minds of democratic people. That is a propaganda plan to destroy any possibility of preserving the peace. Only the atomic bomb will ensure that there will not be a third world war. Immediately the atom bomb is banned, we would be subjected to the expansionist efforts of Russia. Without the atomic bomb, the West would be at a disadvantage, because of the superiority of Russian forces in conventional weapons.
We know that the Communist forces in the world aim at world domination. We had an example of that only a few short months ago. We saw the red tide coming nearer and nearer to Australia. We saw it spreading into Western Europe while red Chinese forces endeavoured to destroy the democratic forces on Quemoy, Matsu and the Pescadores, and began to prepare for an attack on Formosa. We had the experience of Communist activity in Korea and Malaya. That expansionist policy was continued until the Communists realized that the Western democracies had reached the limit of their patience. Had they continued their advance, they knew that they would certainly have provoked a third world war. It would have been fought by us simply to preserve the integrity of the people who were threatened by the Communist aggressors. When they realized that the West would be provoked no further, but would take action, the Communists changed their policy.
We should not be deluded by their change of front, however. They changed their policy only because they realized that they were not economically in a position to fight a prolonged war. They knew that we would not allow any more aggressive action on their part, and that their internal economy would not allow them to prosecute a prolonged war. As a result of their about face, there is not now the same degree of tension in the world as there was twelve months ago. Admittedly, there are some trouble spots but there is not the immediate threat of war. There is only one reason for that change. The Communists have ceased their aggressive advance temporarily. While they are not prepared to trespass on the integrity of other nations, there will be no fear of a third world war, but I believe the respite is only temporary. It will last only for the period the Communists require to build up their internal economy to a point where they will be in a position to prosecute a third world war with every chance of success. When the internal economy of Russia has been re-established on a firm basis, when the Russian leaders are able to give the people the living conditions they are demanding, the food and materials they require, and when the heavy industries are in sufficient production, we shall have the immediate threat of a third world war. That threat will come, not from the Western democracies but from Soviet Russia.
Despite that situation, we in this Parliament are forced to listen to elected representatives of the Australian people with such extreme views that they aru prepared to rise in their places and eulogize the foreign policy of Communist Russia, the aggression of red China and the aggressive activities that are taking place in Malaya. They suggest that Australia should withdraw its forces, which have been sent to Malaya to help the Malayans preserve the integrity of their country.
– The honorable member for Lilley (Mr. Wight) is a warmonger.
– The honorable member for Kingsford-Smith (Mr. Curtin) has said that I am a warmonger. That is a strange remark for a man like the honorable member to make. Honorable members on the Government side of the House would be less inclined to want a third world war than would honorable members on the Opposition side, because we have tested war by experience and have no brief for war. We know the horrors of war, but the majority of honorable members on - the Opposition side have no knowledge of such things beyond what they have read in books. We on this side of the House are deeply sincere when we say that we do not want a third world war. We are striving to ensure that there shall not be a third world war. We can be sure of that only if we make it clear to Russia that there is a limit beyond which the Western democracies will fight its aggressive policy of infringing the integrity of neutral nations. The future of Australia will depend on the policy followed by the present Government. If we were to weaken in our support for the Western democracies, which are working and developing nuclear weapons to ensure that peace shall be preserved, we should give advantage to the Russian forces and we should bring closer the threat of a third world war and the destruction of humanity by the use of nuclear weapons. The recent Royal Commission on Espionage in Australia brought very forcibly to our notice the fact that there are in Australia traitors who would sell out our country to an enemy power. And we can regard Russia only as an enemy power. The royal commission proved that people here have betrayed the nation’s secrets. If we are to preserve Australia’s integrity, and if we are to continue to warrant the trust of the other Western democracies, this Government must ensure that adequate measures are submitted to the Parliament in order to deal effectively with those traitors who would betray the nation in peace or in war, and to put them where they will do the least amount of harm.
Debate (on motion by Mr. Whitlam) adjourned.
Sitting suspended from 5.57 to 8 p.m.
– On the 27th September last, I made a statement to the House on the condition of the national economy, f do not propose to repeat that state ment, but I should recall to honorable members the substance of the analysis of our current problems which was then made. We are, as a nation, enjoying: a high measure of prosperity. Our purpose is to preserve and consolidate it. Toachieve these purposes, we must be prepared to face up to the factors which tend to destroy prosperity by aggravating our costs, to the inflation of our currency,, and to the great task of maintaining and building our trading position in the world. At that time, I said that we were experiencing a high and growing money purchasing power, not capable of being satisfied by Australian production, and that we had, therefore, developed a vast demand for imported goods, putting an immense strain upon our external balance of payments. I pointed out that our level of wages and costs, partly arising from the competition for scarce labour, generated by excessive demands, was threatening our export capacity. I added that the terms of trade were tending to move adversely to us and that, in consequence, a greater volume of exports was needed to pay for a fixed volume of imports. This led to the conclusion that our economy was tending to become unbalanced, with a disposition in favour of a permanent debit on our international trading account. We proceeded, in September, to impose further restrictions upon imports, in order to help to arrest the fall in our international reserves and therefore to check the threat that would otherwise arise to our exchange rate. It has previously been made clear that the excessive demand for imports, which has been restrained but not destroyed by import restrictions, arises from the inflationary impact of excessive demand for both capital and consumption goods upon a limited supply of both. On the capital side, we are,, in Australia, trying to spend on investment twice as much as our current savings. To the extent to which the deficit cannot be financed by borrowing other people’s savings from overseas, the inevitable result is inflation with higher costs and prices all round.
It was therefore made clear, in September, that our objective was to restore our balance of payments by the end of June this year; to assist that object by import restrictions; and to make it certain, if necessary, by adopting fiscal or other measures which would restrain local inflation, diminish import demand, preserve our currency on the international markets and enable us to develop our position as a trading .nation. In my September statement, I discussed in some detail the problem of the balance of payments and of our international reserves, and endeavoured to explain the importance of achieving a balance by the end of June, 19&6. As I then pointed out. -our international reserves, which stood .at £570,000,000 in June, 1954, had fallen by June, 1955, to £428,000,000. Notwithstanding import restrictions the fall continued during the next six months, so that toy the end of December last the reserves stood at about £370,000,000. The main reason for this fall was, of course, that we were still importing too much. We have had good seasons and it is almost certainly true that in this current financial year 1955-56 we have had a .greater tonnage of goods available for export than ever before in our history. We also have had a quite substantial amount of capital inflow. I hope that no honorable member will think that the measures I .am to-night announcing “will discourage the investment of capital in Australia from overseas. On the contrary, we have every reason to believe chat a continuing inflation discourages overseas investment but that a clearly demonstrated determination to produce internal stability encourages it. The nominating cause of our external payments deficiency is the striking increase in the annual value of our imports and this in turn represents a demand which is the inevitable product of internal inflation.
I am happy to say to honorable members that in the light -of our experience to date and having regard to the additional import restrictions which I announced in September - I am certainly announcing no more to-night - and to the measures which I will later on in this speech announce, there is every reason to suppose that our objective of balancing our external accounts by the middle of this year will be achieved. If that forecast proves to be right, the first vital step in righting o.ur position will have .been accomplished. Measures beyond import restrictions are of course necessary if we are to have a lasting cure. To achieve economic health, we must, clearly, increase out ‘output, ot reduce -our demand, or both. An increase in national and individual output is clearly essential to the raising of the material ‘standards of living. What does increased output mean and involve? The -answer is - greater productivity per unit. On the farms this means such things as sowing down and top dressing of pastures, better subdivision and water supply, more power and machinery. Farm production has been improving, the significance of the improvement somewhat obscured by price falls. But without this .and without increases in industrial production, our situation would be serious. In short, increased productivity is of the essence. It cannot^ therefore, be overlooked in any long-range planning for national development. Intrinsically, it cannot have immediate .short-term results, for in its nature it is .a matter -of relatively slow growth, though nonetheless vital for that. Bat the .attack on the productivity problem is still a matter for -urgent attention. It is the positive, as opposed to the .negative, of economic action. A constant appreciation of .its importance induces .an active and dynamic attitude, and serves to defeat stagnation. We have not yet fully -understood that rapidly increasing population, industrial expansion, .adequate national defence, high .and stable employment, just social .services, and rising real standards for the individual - to all of which we are as a nation dedicated - cannot be simultaneously achieved without increasing skill, -organization, and effort. To put it quite clearly, we cannot have .increased development and increased individual consumption without increased individual production, saving and investment.
Time will not permit me to elaborate this important thesis. But -one point emerged from our -recent discussions with our advisory committee and among ourselves. It is that -because a good deal of existing capital equipment is hot being fully or economically used, some material increases in production -could be achieved even without additional investment; in other words., without further inflationary demand pressure upon limited capital resources. My colleague, the Minister for Labour and National Service, has an employer-employee committee - the Ministry of Labour Advisory Council - which has already given much thought to this matter. If it can give some further concentrated attention to this matter and perhaps become an effective productivity council, we will welcome it. There can be no doubt that there is an urgent need to examine the possibilities of making greater use of our existing industrial capacity by such means asI illustrate it by one reference - double shifts.
I turn now to the other aspect of this problem. In Australia, wages and salaries are high, employment is more than full, and, therefore, purchasing power and demand are at record levels. It seems to be a merely academic exercise to try to determine whether the excessive demand and, therefore, the. inflation, arises from demand for consumption goods or from demand for capital investment. The simple truth is that any excessive demand for consumption goods is bound to produce a corresponding demand to import those goods or for capital investment to produce them. No responsible person can doubt that we are, in fact, undergoing a very great inflationary pressure, a pressure which cannot be relieved by mere prohibitions any more than the pressure in a steam engine can be relieved by closing the safety valve. To the extent to which we can increase productivity, we will ease the pressure. To the extent to which we can increase our exports, we will relieve the consequential effect upon our balance of payments. But the truth is that, in the short run, the most effective immediate way to relieve the pressure is to reduce the volume of purchasing power which creates it.
It is inevitable that properly considered taxation measures should be the most powerful immediate instruments. We have considered increases in taxation, not merely in book-keeping terms, but with our eye constantly upon the effect which the selected taxation may have upon capital demand inside Australia and import demand outside Australia. In brief, any increases in taxation should be designed as far as possible to reduce inflation. In the light of these considerations we have decided upon the following courses of action: -
When I have concluded my statement, various legislative measures will be introduced and explained. I will, therefore, content myself by stating the substance of these fiscal proposals.
The present rate of sales tax on passenger cars, that is, non-commercial motor vehicles, is 162/3 per cent. It was 20 per cent. until the 1953-54 budget. This rate will be increased to 30 per cent. Not only do motor vehicles and their components constitute a substantial item in our imports, but they also represent the bulk in value of hire-purchase transactions and they have, in fact, generated a vast capital demand inside Australia. We are well aware of the benefits which will ultimately flow from this great industry, but we are convinced that proper counter-inflationary action requires that some temporary restraint should be laid upon it. Commercial motor vehicles and motor cycles now carry a sales tax rate of 12½ per cent. There is a powerful case for imposing as small an additional burden upon commercial motor vehicles as possible. We, therefore, propose to raise the level of tax in the case of these items only from 12£ per cent, to 16§ per cent.
T would not have it thought that we are in any sense hostile to the motor vehicle industry. On the contrary, we regard it as one of the great and growing industries of Australia and we have welcomed the transfer of capital and skill” from other countries to our own. But this does not relieve us of the obligation to do what we can to prevent a good thing from distorting the general economic balance of the country. In other words, a large demand for and supply of motor vehicles in Australia is a good thing. But an excessive demand may, to the extent to which it creates inflationary pressures, actually damage those export industries upon which our international solvency depends.
Let me give the House a few significant figures. The registrations of new motor vehicles have risen from 156,996 in 1952-53 to 245,271 in 1954-55, that is in a period of two years. If we turn to new motor vehicles, we will find that whereas the sales of trucks and utilities have maintained a fairly stable average over the last four or five years, the large increase has been in the items of motor cars and cycles. The imports attributable to the motor industry in the last financial year, i.e., vehicles and parts, rubber and other tyre materials, motor spirit and oil, were estimated at no less than £152,000,000 out of total imports in that year of £844,000,000. Goods of a less essential character, ranging from jewellery to gramophone records, are now included in the category1 which carries a rate of 16f per cent. Subject to the special provision I have named about passenger cars, there will be an increase in this category from 16$ to 25 per cent.
Apart from commercial motor vehicles and motor cycles, all those items which are now in the 12£ per cent, category, including bicycles, I am happy to say, will continue to carry 12£ per cent, without increase. The same applies to the 10 per cent, group, which includes a variety of household goods and appliances, furniture, crockery and the like, and will not .bear any increased tax.
– What about prams ?
– I hope prams are in that list, I do indeed. I will make a note of it, and if they are not I will include them. All told, these increases in sales tax are estimated to produce in a full year additional revenue of approximately £30,000,000.
Notwithstanding the natural reactions to so sensitive a subject, beer can plainly carry more taxation than it does. We therefore propose to increase the excise on beer by 2s. 8d. a gallon, which is equal to 2d. per 10-oz. glass. Beer will, assuming that demand continues unabated, yield an additional £29,300,000 in a full year at the current rate of clearances. We have no over-optimistic anticipation that this increase will reduce the consumption of beer. But it will certainly make a powerful contribution to the avoidance of deficit finance. It is a matter of note that when, in the 1951-52 budget, we increased the excise on beer by 2s. 7d. a gallon, there were some prophecies of drought and even of financial disaster. I should therefore point out that the clearances after that budget rose from 172,900,000 gallons in 1951-52 to 183,800,000 in 1953-54, and in the current estimate are calculated to rise to 223,300,000 gallons, a truly staggering total. Consumption of beer per head of population has doubled since 1938-39.
– In round figures?
– In round figures. The honorable member is quite right; rounder and rounder and rounder as consumption goes up.
In the case of spirits, where the revenues are naturally much smaller, we established in the 1954-55 budget a special margin in favour of brandy, in which the large wine and grape industry is concerned, by reducing the excise on brandy by 30s. a proof gallon. We propose to increase the customs and excise duties on spirits by 15s. 6d. a gallon. This increase will still leave brandy with its present margin, will be equivalent to an increase of Id. a nip.
– “ Nip “ is the operative word.
– The honorable gentleman must tell me afterwards what that means. The increase I have mentioned will on the current level of clearances yield £2,200,000 per annum.
We propose to increase the existing duties on tobacco, cigars, and cigarettes as follows: - by 4s. per lb. on manufactured tobacco, equal to a retail price increase of 3d. per oz. ; in the case of cigarettes by 6s. per lb., equal to an increase in the case of a standard type of 3d. per packet of twenty; and cigars by 5s. 6d. per lb. From these proposals, we will expect to get in a full year added revenue of £12,000,000.
Petrol involves a large imported component. We propose an additional tax of 3d. a gallon on petrol which will, at the current level of clearances, yield an additional £12,000,000 per annum. We have, at the same time, given earnest consideration to the question of the assistance to roads given under the Commonwealth Aid Roads legislation. Two years ago, we made a very substantial improvement in this field by providing for a payment to the States of 7d. a gallon on petrol consumed. This will, as on and from the 1st April, 1956, be increased, on the existing conditions, which provide for not less than 40 per cent, being expended on rural roads, to 8d. a gallon which will represent approximately an additional £4,000,000 on the roads grant.
Summing it up, and allowing for the additional payment for roads, all these changes in- customs and excise duties will in a full year yield net additional revenue approximating £51,000,000.
We are not proposing any increase in personal income tax. We do, however, consider that company taxation can properly be increased to some extent. Companies have in fact enjoyed a period of great prosperity and can afford to make some contribution to the solution of the current problem. The taxable income of public and private companies has risen very considerably since 1951-52, rates of dividends have frequently increased and there have been substantially greater allocations to reserves. The weight of company taxation is undoubtedly much lower in Australia than in overseas countries like the United Kingdom, Canada and the
United States of America. We propose, therefore, to increase company tax all round by ls. in the £1. This, it is anticipated, will yield in a full year £30,000,000. In the nature of things, it will not become operative for collection purposes until the next financial year, for reasons well-known to honorable members, in which year we would expect to collect £27,800,000.
I indicated in my economic statement of September last, and also in my recent policy speech, that we would hold ourselves ready to use any fiscal measure? which were needed, not only to reduce the volume of imports as a measure supplementary to direct import restrictions, but also as a corrective to inflation. What 1 have just announced represents our carefully considered proposals to these ends. It is, I think, necessary that I should point out that these measures are not depression measures they are designed to preserve our existing prosperity by checking inflation and therefore making our prosperity more stable and more secure. It will, I hope, be widely understood that you cannot cure inflation by doing nothing. You can cure it only by endeavouring to diagnose its causes and then taking such measures as are possible to deal with those causes. It is in the light of these considerations that this special financial programme is submitted to the Parliament and to the people. Our current problems are all manageable, and no exaggerated feelings need be created by them.
I have already explained how the Government has reached its conclusion tha; taxation should be employed, in selected ways to provide a form of brake upon consumption and investment spending. 1 will in a few moments explain that we also have in prospect a cash deficit on the total operations of this financial year. What, however, are we to take as the appropriate measure of the amount of additional taxation that should now be imposed? Unless we gain additional resources, the cash deficit for the current year would certainly not be less than £30,000,000. I will say something in a moment about the following financial year. Clearly, however, that deficit arise: out of conditions which, largely, are now behind us, whereas it is obvious that we must shape our financial measures as far as may be practicable to meet circumstances that lie ahead.
There could be no problem more difficult than the accurate measurement of our financial resources and commitments in a period extending some fifteen months from the present time, and that, in reality, is what I am undertaking to do. The estimating of taxation revenues is, even under stable conditions, a most intricate business and a problem into which all manner of imponderable elements find their way. It becomes doubly difficult if the forward prospect is influenced by the currents and cross-currents of inflation. At the very best, we can only make a judgment based upon considerations of the broadest kind.
One of the great pitfalls of policy m a period such as the present is that, at first, inflation makes Government financing look easy. “With rising incomes and rising levels of expenditure, revenues tend to be buoyant, and if we were prepared to contemplate that the current trends in incomes and levels of expenditure would continue unrestrained throughout the next financial year we could, no doubt, look forward to a very substantial increase in revenues. Plainly, however, the Government cannot permit itself to rely upon such an optimistic view of things, if it is optimistic. It would, in truth, be to suppose that the object of our economic policy measures will not have been accomplished. Therefore the only view to take is that, though there will be some increase in revenues in 1956-57, that increase will not be of the magnitude which continued inflation might produce.
It is also a pitfall of policy in a time of inflation that while revenues rise first, a little later on expenditures begin to rise also. Costs of all kinds begin to creep upwards. Various unforeseen contingencies suddenly present themselves. The point almost inevitably comes when, no matter how far revenues may have increased, expenditures are found to have risen above them. We already begin to perceive signs of such a movement in our own budget and in those of the State governments. Although, therefore, it will be our policy to apply the most rigorous restraints upon government expenditure of all kinds, we cannot ignore the likelihood that expenditures in some fields at any rate must next year be substantially higher than in the current year.
There is one circumstance also of special significance for any forecasting of possibilities in 1956-57. In that year, the next financial year, a very large amount of public debt, comprising three major loans and totalling some £253,000,000, will reach maturity at intervals throughout the year. We shall, of course, do our utmost to convert as much as possible of this debt into new securities. The amount, however, is extremely large in relation to the market. It would, moreover, be sheer folly to fail to recognize that borrowing conditions in 1956-57 may be more than usually difficult. That must affect both the prospect for converting old loans and the prospect for raising new loans such as may be required for finance of the works programmes of the States.
These are the broad considerations which we face in trying to form a judgment of what additional resources in the shape of revenue we may require if we are now, and in 1956-57, to preserve a condition of balance in our public accounts in terms of cash receipts and outlay. Our carefully considered judgment in respect of that period of fifteen months has been that the amount we require will be somewhere between £100,000,000 and £120,000,000, the details of which I have set before the House.
May I deal briefly with the argument that increased taxes merely transfer spending power from private persons to governments, and that private persons can spend their money more prudently and effectively than governments can. I will not discuss this as a general proposition, except to say two things. The first is, that government expenditures on public works are, so far as we are concerned, made to satisfy public requirements which cannot, in their nature, be transferred to private citizens. No group of private citizens could be expected to provide for national defence, for such vast works as the Snowy Mountains scheme, for postal, telegraphic and telephone capital expenditure, and for the payment of interest and sinking fund on the national debt.
But there is another unavoidable fact now emerging, the significance of which, not only to the overall budget but also to counter-inflationary policy, cannot be overlooked. It is this: We have, for 1955-56, budgeted for a surplus - which has been already dealt with - of £48,700,000. In spite of some enthusiastic, but unofficial estimates, made some months before the end of the financial year, our advices are that the estimate will be substantially correct. But the revenue budget is not all.
We have, in addition, accepted some responsibilities in respect of the borrowing programme approved by the Australian Loan Council - a programme which, leaving aside the housing allocation, which the Commonwealth raises for the States, £8,000,000 for war service land settlement, and £3,000,000 for wheat storage, is actually for State works. The state of the loan market has been such that the Commonwealth will find itself called upon to find for the States from its own resources, a sum not less than £67,000,000. Moreover, cash has already had to be provided to meet heavy redemptions in the loan which matured last December. We are thus confronting an overall cash deficit, not a surplus. As I have already said, the cash deficit will not be less than £30,000,000 unless between 11OW and the 30th June we obtain additional resources.
Without such additional revenue, this deficit would need to be financed by the Commonwealth Bank, by the creation of new money which would add to the existing heavy inflationary pressure. Reducing or avoiding a cash deficit is, therefore, not only a matter of balancing the Commonwealth accounts; it is, most importantly, a matter of avoiding the aggravation of an inflation, which it is our principal economic purpose to restrain and defeat. Money out of the existing supply of purchasing power which is transferred by taxation to the Commonwealth is not inflationary. New money, created by the central bank to finance a deficit, is inflationary.
Under the circumstances of the market, the central bank has, until quite recently, felt called upon - as I pointed out last Thursday - to support bond prices by abnormal - and in total, huge - purchases, this again involving the creation and outlay of many millions of pounds of new money. This is inflationary. On top of these matters, there are two other factors which cannot be ignored. The first is that, with rising costs, the State governments may - and undoubtedly will - encounter additional deficits this year. The second is that the central bank finances the payments made by the Austraiian Wheat Board to wheat-growers, and for well-known reasons, carries a large cash debit on that account because, as all honorable members who represent wheat-growing constituencies know, a great deal of the wheat remains unsold, and therefore the money has not come back. It follows from all this that, in addition to the general inflation arising from high purchasing power, excessive demand for capital, a shortage of labour and of over-all supply, and inadequate national productivity, we have an added inflation by central bank deficit finance which no government can comfortably contemplate, and which fiscal measures alone can correct.
I propose now to take the time of the House to discuss interest rates, because there are certain current misconceptions about them. In an inflationary period when capital, labour, and materials are all relatively hard to come by, there will be pressures upon the price of money just as there is competition for labour with increased wages, and for scarce materials with increased prices. The feature of the last few years in the money market in Australia is not that interest rates have been consciously forced up, but that they have, in fact, been held down. The bond rate, as I said to the House on Thursday last, has been largely held down by abnormal purchases by the central bank. The bank rates of overdraft and deposit have been held down by the adherence of the trading banks to an agreement with the Commonwealth Bank.
What should we do about these matters ? Should we pursue the measures necessary to hold down interest rates longer, or should we face the facts? I have already told the House that it would be selfcontradictory for the Commonwealth Bank, residing as it does at the centre of monetary and credit control, to say with one breath to the trading banks that they must restrict credit and, after the next breath, to go on an abnormal scale into the market and create new money in order to buy bonds.
If this is right, as I believe it to be, it becomes necessary to turn to interest rates generally. The Commonwealth Government has no authority over interest rates charged in non-banking business. I know that the Leader of the Opposition (Dr. Evatt) has a feeling that this might be coped with by taxation measures; hut he will be the first to agree with me that there will be no certainty of the validity of such measures and that it follows that, in the short run, they are not a useful instrument. In the long run, we will consider them. But we do have something to say about the deposit and overdraft rates of the banks. Should they be raised or, more accurately, should they be permitted to rise? Would a rise in the overdraft rate have some use as a counter-inflationary measure? If it would, we should most obviously consider it. On this point as on many others, we have, had the advantage of the views of a powerful advisory committee and of close and prolonged discussions within the Government itself. Our conclusions may be stated in this way.
A rise in interest rates will not of itself solve our problem. Recent experience in the United Kingdom and other countries overseas confirms this view. But a rise in bank overdraft rates must have some effect, the extent of which cannot be precisely measured, upon the demand on the banks for capital accommodation. We, in Australia, do not have a large and established short-term money market as they have in London and New York. We, therefore, have no bank rate which can he used as a flexible instrument. Whatever we do must reflect itself in overdraft rates and deposit rates and, of course, depending upon the circumstances of the market, in the long-term bond rate. The Government believes that a rise in interest rates should be permitted only if it is part of a general pattern of counter-inflationary action.
I pause here to indicate some of the circumstances which lead to the conclusion that it is impracticable to hold the overdraft and deposit rates down to what has become an unreal level. There are reasons for this. Under the circumstances now existing, the trading banks have found that funds are being diverted from fixed deposits to finance expenditure at much higher short-term rates of interest on hire purchase and the like ventures. The financing of enterprises on bank overdraft at the present relatively cheap level has been resorted to increasingly. The reasons for this are clear enough. If a company raises capital by a new share issue, it must succeed sufficiently to pay an adequate dividend on that capital. But if it raises money on bank overdraft, then the whole interest charge on that overdraft is a business expenditure which can be deducted for taxation purposes and the amount of the overdraft does not call for a dividend. One of the chief results of this is to stimulate businesses to. rely unduly on bank accommodation. Again, there are many instances of overseas enterprises which are able to borrow from the banking system at an overdraft rate which is relatively low’ and then to remit surplus funds abroad to take, advantage of higher rates overseas. This leads to the creation of a greater reliance upon borrowing in Australia rather than overseas for the development of local business. It also has led to a greater reliance upon borrowing in Australia rather than overseas for the financing of exports, including the major export of wool. Under all these circumstances, we have felt it necessary to consider whether the overdraft rates and the deposit rates of the banks should be permitted to rise to some reasonable extent. In considering this matter, we have been naturally profoundly concerned about the position of the export industries whose costs rise under the pressure of local circumstances but whose prices are determined by world markets.
Having regard to what has happened in the bond market, and to the other circumstances to which I have referred, we have agreed - I say “agreed” because interest rates are at present adjusted by agreement between the Commonwealth Bank and the trading banks - that the bank overdraft rate should be permitted to rise from 5 per cent, to an average of 5£ per cent., with a maximum of 6 per cent. At the same time, we have agreed that there should be a rise in the bank deposit rates, that is the interest rates paid by the banks on fixed deposits made by their customers, of 1 per cent. This requires a little explanation.
We do not intend that the profits of the trading banks should rise as a result of any counter-inflationary action taken by us. There are, indeed, various ways and means by which this can, if necessary, be dealt with by government action. But I think I should say quite plainly that the trading banks have been co-operating extremely well with the central bank-
– That is the old, old story.
– I have the authority of the central bank for that statement.
– They are all happy friends together.
– I thought the Leader of the Opposition was a friend of the Governor of the Commonwealth Bank. Has the right honorable gentleman deserted him?
– No, the Prime Minister has adopted him.
– I repeat that I think I should say quite plainly that the trading banks have been co-operating extremely well with the central bank on the general restraint of credit and other counterinflationary measures and we see no reason to believe that this will not continue. This is why we have indicated our approval of an average rise in overdraft rates to 5^ per cent. The purpose of this decision is this : One of the objects of allowing bank rates to rise is to counter inflation. If bank accommodation becomes more expensive, the- capital demands upon the banks will tend to fall. But there are other aspects of the matter. Our desire is to impose no avoidable burden upon the export industries or substantially import saving industries, whether those industries are primary or secondary. We therefore expect that if the banks are permitted to raise their average overdraft rate to 5i per cent., they will have effective overdraft rates both below and above that level. Indeed, they must have such rates. We expect that the lower overdraft rates will be employed in aid of important production and import saving, and that the higher overdraft rates will be employed to restrain inflation. An increase in the banks’ deposit rates may be expected to direct into the fixed deposit field some amount of money which at present seeks profitable short-term employment in other fields. We will closely watch the results of these decisions because - and again I repeat it - our purpose is to recognize the stern facts of the interest position and, at the same time, to avoid any building up of banking profits as a result of the new limits allowed to the overdraft rate.
Finally, I repeat what I said last week : that though undoubtedly any increase in overdraft rates may have some prima facie effect upon the export industries, that effect will be small compared to the ruinous effect which an unrestrained inflation could and would have upon their costs and upon their capacity to sell to a competitive world.
As I told the House in September last, conscious efforts have been made to restrain the volume of bank credit. Without such restraint counterinflationary action would be frustrated. We have reached the conclusion that the restriction of credit has gone as far as it reasonably could, and therefore that while present policies must be maintained they need not be intensified. We have therefore decided that new action in the economic field must direct itself to other measures.
We recognize that any increase in taxation or interest rates tends to operate against the production of goods for export, which is principally from the land. But it is quite true that if tax and interest measures are effectively designed to check inflation, the export producer will achieve a substantial benefit. We have, however, given close consideration to the special depreciation allowances for primary producers which permit them to write off at 20 per cent, per annum over five years capital expenditures incurred in respect of plant, machinery, certain structural improvements, and residential accommodation for employees, tenants, or share farmers to the extent of £2,000 per employee. The current legislation, which has brought about very great benefits, is due to expire on the 80th June, 1956. Legislation will be promptly introduced to extend the act for a further three years from the 1st July, 1956, and to provide that the present limit in respect of expenditures incurred in the erection of residential accommodation for employees, tenants and share farmers, namely £2,000 for an employee and his family, be raised to £2,750.
There may be a good deal to be said for introducing selectivity into the demand for capital by some system of capital issues control like the one which existed during the war and was thereafter for a time continued under the defence power. But our legal advisers do not believe that capital issues control could be re-instituted for purposes of anti-inflationary action. The whole problem may well be one for discussion with the States, who have the necessary powers, but for present purposes any discussion of that problem would be premature.
The same applies to the vexed problem of hire purchase finance. Various suggestions have been put forward for dealing with this matter, but each of them involves action of doubtful constitutional validity and could hardly, therefore, be relied upon to produce immediate results. What I have announced about interest rates and taxation may, of course, have some effect in this field.
There is some disposition to accuse government expenditure, and particularly works expenditure, of responsibility - even of prime responsibility - for internal inflationary capital demand. The truth is that in the last four years government capital expenditures have remained at least constant in terms of money. The large growth in capital demand has been in the private sector. All our own political beliefs run in favour of private enterprise. But I think it would be unjust even to appear to encourage the popular belief that government expenditure is in its nature either commonly extravagant or unproductive. Let me say just a few words about this. For some years now the works programmes being undertaken by public authorities in Australia have involved an expenditure running around £400,000,000 a year. Works related to transport, such as railways, Toads, streets, bridges and so on, add up to about £130,000,000 a year. The railways are still vital to our trans port system. Without constant modernization they will not only fail to perform their important functions, but will produce large and growing annual deficits.
The next great group of about £100,000,000 in the works programmes comprises those for power and fuel, particularly for electrical power development. The development of our power resources is something which is not done for governments but for private industries and people.
Then there is another group - dwelling construction and water supply and sewerage. These take up something like £60,000,000 a year. I am speaking of government expenditure. I doubt whether any Australian would seriously criticize them.
Communications involve an annual expenditure ranging between £25,000,000 and £30,000,000 a year. Businesses and private citizens would be the first to complain if the expenditure on telegraphic and telephonic and postal facilities came to an end, or was substantially reduced.
What I have said does not mean there must not be prudence and careful review and the elimination of extravagance. But it is still true that private industrial development and social improvement depend to a marked extent upon properly chosen and well executed public works. We will, of course, review all these matters for the new financial year, but they certainly do not lend themselves to sudden intermediate decisions two-thirds of the way through a financial year.
There are many items of national budgetary expenditure which do not lend themselves to reduction at all, except by repudiation or dramatic changes of national policy.
Thus, our accumulated debt service, interest and sinking fund, now standing at £68,000,000, cannot be reduced without” repudiation. Our normal payments, now £220,000,000, to the States cannot be reduced without a drastic reconstruction of Commonwealth-States financial relations. Our expenditure on social services, now £218,000,000, cannot be reduced without changes of social policy to which the great majority, both inside Parliament and outside, would be opposed. Of the total expenditure of the Commonwealth, say £1,100,000,000, no less than £700,000,000, representing social services, debt service, payments to the States, repatriation benefits, and expenditure on the Postal Department and other business undertakings, are not only not susceptible to reduction, but are found, in the nature of things, to tend to increase. “We find, therefore, that the possible avenues for producing a lesser net expenditure are, without exhausting the list, such items as the defence vote, Commonwealth works expenditure, payments to the States in support of loan programmes, departmental functions and staffing, and the migration programme. These items also do not lend themselves to sudden alteration at this stage of the financial year. But I want to say that each of these matters is now being closely reviewed for purposes of the next budget. In September last I announced, and we have sustained, a reduction in Commonwealth works expenditure. The loan works programme of the .States has in fact been held at a substantial stable level, in terms of money, during the past three years, and has therefore been reduced in physical terms. The migration programme, which adds to capital demand in Australia but makes a notable contribution to current production and national security, will be reviewed before the next budget with a view to establishing some stability of intake at a manageable and adequate level.
It would, of course, be wrong to discuss our economic problems exclusively in short terms. We in Australia have great achievement in the past and confident hopes for the future. We have succeeded to a remarkable extent in building up our population, our productive capacity and our living standards. We have been able to provide a happy and well furnished life for the great hulk of our people. We have certain national objectives to which all our major efforts must be directed; a vigorous national development; adequate defence; a high and stable level of employment at good wages and under civilized conditions; adequate measures of social security; an increasing and vigorous population. On some of these matters we have done a great deal; on others, perhaps, less than we should have liked to do. It would be a great error to suppose that this Government is announcing any abandonment of any of these objectives. The short-term task to which my statement of to-night must primarily be directed is to determine what temporary modifications we must make in our current demands so that our ultimate demands may be soundly satisfied.
In every story of national progress, there must be advances with every now and then some period of consolidation of our gains. This does not mean we have to advance and then to retreat. There is a vital difference between retreating from positions attained or abandoning ultimate objectives, and having a sensible period of consolidation so that the next advance may be made from firmly secured positions.
There is no great nation in the world which does not regard the inflationary problem as a vital one. Therefore, when we take the necessary steps to meet inflation we are not only preserving our own legitimate interests at home but we are inducing abroad a proper measure of confidence in this country and of willingness to contribute in practical terms to its future growth and development.
All the main indicators in the economy show a high level of current prosperity. Additional recent facts support this conclusion. But prosperity needs to be understood if it is to be preserved. Like so many other good things, it tends to generate forces which may turn out to be adverse to it. In this statement, some of those forced have been discussed, and some counteracting measures offered. It should continually be emphasized that we are neither anticipating nor seeking to meet a depression, still less to make one. What we are trying to do is to prevent some elements in our prosperity from aggravating an inflation which could, if left alone, undermine our prosperity. That is why I say that all the adverse factors are manageable, provided that we are prepared to prefer a lasting prosperity to a temporary boom which, if uncontrolled, could lead to unhappy consequences. It may occasionally suit individuals to gamble upon inflation, but such a gamble oan never be the true policy for a young and growing nation which is seeking to build an expanding future upon solid and secure foundations.
I conclude by saying that I am not so inexperienced as not to know that the statement I have just made, for my colleagues and myself, will be the subject of controversy. But most people will see, on reflection, that our programme of action is, having regard to our problems, a moderate and balanced one. If we had done more, we might have done too much and. created fears which we ourselves certainly do not entertain. If we had done less, or, as some may advocate, nothing, we would certainly have exposed the economic well-being of millions of Australian men and women to the destructive attacks of a growing and ultimately unrestrained inflation.
T lay on the table the following paper : -
National economy - Economic measures - Ministerial statement. and move -
That the paper be printed.
Debate (on motion by Dr. Evatt ) adjourned.
Motion (by Sir ARTHUR Fadden) - by leave - agreed to -
That leave be given to bring in a bill for an act to amend the Sales Tax (Exemptions and Classifications) Act 1335-1954.
Bill presented, and read a first time.
– by leave - I move -
That the bill be now read a second time.
The object of this measure, in conjunction with certain supplementary bills to be introduced later, is to give effect to the sales tax proposals outlined in the statement which has just been delivered by the Prime Minister (Mr. Menzies).
It is proposed to increase the rate of tax on passenger motor vehicles from 16f per cent, to 30 per cent., and the rate of tax on motor cycles and commercial motor vehicles is to be raised from 12J per cent, to 16f per cent. Parts and accessories for all these vehicles, other than tyres and tubes, will bear tax at the rate of 16f per cent., instead of 12^ per cent, as at present. Parts and accessories are, to a large degree, capable of use either on passenger vehicles or on commercial vehicles, and for this reason it is proposed that parts and accessories for all motor vehicles shall bear the same rate of tax, namely 16$ per cent. The rate of tax on all other goods hitherto taxed at the rate of 16$ per cent, is being increased to 25 per cent. Broadly, the goods affected include jewellery, imitation jewellery, plated ware, cut glass ware, fur garments, cameras and photographs, toilet preparations and equipment, wireless and television receiving sets, gramophones and records, travelling bags and baskets. A complete list of the goods affected has been circulated for the information of honorable members.
The opportunity is being taken in this bill to re-express the item relating to wireless receiving sets, to make it clear that this provision embraces television receiving sets as well as sets used for sound reception only. These goods have hitherto borne tax at 16f per cent.; the rate is now raised to 25 per cent. It is estimated that the increases will yield additional revenue amounting to approximately £30,000,000 in a full year. The increases will take effect on and from to-morrow, the 15th March. It should be noted that there has: been no increase in the tax on household furniture and utensils which bear the minimum rate of 10 per cent. Furthermore, the wide field of utilitarian goods which are subject to the general rate of 12£ per cent, remains undisturbed.
The reasons for the sales tax increases have already been fully stated by the Prime Minister. They are necessary as a part of the Government’s plans to check inflationary trends in this country, and to reduce the demand for imports. As such, I commend them to the consideration of honorable members.
Debate (on motion by Mr. Calwell) adjourned.
SALES TAX BILLS (Nos. 1 to 9) 1956.
In Committee of Ways and Means:
– I move -
That, on and after the fifteenth day of March, One thousand nine hundred and fifty-six, in lieu of the sales tax imposed by the Sales Tax Act (No. 1) 1930-1954, the Sales Tax Act (No. 2) 1830-1954, the Sales Tax Act (No. 3) 1930-1954, the Sales Tax Act (No. 4) 1930-1954, the Sales Tax Act (No. 5) 1930-1954, the Sales Tax Act (No. 6) 1930-1954, the Sales Tax Act (No. 7) 1930-1954, the Sales Tax Act (No. 8) 1930-1954 and the Sales Tax Act (No. 9) 1930-1954, sales tax be imposed at the- following rates, but otherwise in accordance with the provisions of those Acts: -
That, for the purposes of this resolution, “the Sales Tax (Exemptions and Classifications ) Act “ mean the Sales Tax ( Exemptions and Classifications) Act 1935-1954, as proposed to be amended by the Sales Tax (Exemptions and Classifications) Bill 1956.
This resolution is really a machinery measure which is necessary to implement the Government’s proposals to increase the rates of sales tax on certain goods. It is complementary to the Sales Tax (Exemptions and Classifications) Bill 1956, which has just been explained to honorable members. The effect of the proposals has been made clear in my speech on that bill. This resolution fixes the rates of tax which will be applicable to the various classifications of goods to which attention has been drawn. An explanatory statement has been circulated, and any further exposition of it at this stage would be merely repetition. I commend the resolution to honorable members for their consideration.
– I move- [Customs Tariff Amendment (No. 1).]
Cite as: Australia, House of Representatives, Debates, 14 March 1956, viewed 22 October 2017, <http://historichansard.net/hofreps/1956/19560314_reps_22_hor9/>.