House of Representatives
18 September 1956

22nd Parliament · 1st Session



Mr. SPEAKER (Hon. John McLeay) look the chair at 2.30 p.m., and read prayers.

page 567

QUESTION

SUEZ CANAL

Dr EVATT:
BARTON, NEW SOUTH WALES

– I desire to ask the Minister for External Affairs a question on the dispute over the control of the Suez Canal. Will the right honorable gentleman tell the House the present position of the Australian Government and of the new proposal that has been made? I say new “ because this is the third proposal. The first proposal, sometimes called the Menzies proposal, followed a London conference. Then there was the Nasser proposal of a larger conference and now the proposal is for a users’ conference. In making any statement, I ask him to refer to what we on this side of the House consider should be done, and that is to co-ordinate all these proposals and consider them, not in an atmosphere of a number of selected nations in conference, but in the atmosphere of the United Nations. Our opinion is that the dispute should be considered by the United Nations. Will the right honorable gentleman consider making such a statement?

Mr CASEY:
Minister for External Affairs · LP

– I propose at the end of question time to seek leave to make a short statement on this matter.

page 567

QUESTION

PURCHASE OF AIRCRAFT

Mr McCOLM:
BOWMAN, QUEENSLAND

– My question is directed to the Minister for Air. Recently the purchase by Qantas Empire Airways Limited of American jet aircraft has been strongly criticized. Could the Minister inform the House why British aircraft were not purchased, especially as an American airline company has purchased Comet aircraft made in England? The basis of the criticism is that American aircraft have been purchased instead of British aircraft.

Mr TOWNLEY:
Minister for Air · DENISON, TASMANIA · LP

– All members of the House are aware of the keen interest of the honorable member for Bowman in anything to do with aviation, and his question is not an unexpected one. lt would take quite a long time for me to explain all the details surrounding the purchase of Boeing aircraft by Qantas Empire Airways Limited, but I shall be as brief as I can. Qantas

Empire Airways Limited is in a very big way of business now. It is one of the premier international airlines in the world. It goes to about 34 countries, carries about 140,000 people a year, and flies about 12,000,000 miles a year. When it first started, its revenue was about £1,000,000 per annum; this year it will be £16,000,000 and in the foreseeable future will be £20,000,000. Therefore, it comes into competition with all the other great international airlines of the world, such as Pan American World Airways, T.W.A. - Trans World Airlines Incorporated - and so on. Unfortunately, if an airline is to prosper at the present time it must use American aircraft. There are no British aircraft comparable to the types that are available, and are becoming available, from the American factories. Naturally, we took the keenest interest in everything that the United Kingdom had to offer, but the manufacturers in that country just did not have the sort of aircraft which suited Qantas routes, either by virtue of pay load, range or speed. There was always something that put the British aircraft at a disadvantage, lt is quite true that an American airline has bought, or ordered, British Comet IV.’s, but to understand the position you would have to compare that purchase with the purchases that were made by Trans-Australia Airlines, because both are internal airlines, whereas the Qantas planes have to cover vast distances over the seas. But quite plainly the Comet, apart from the speed disadvantage of about 80 knots, is also very much shorter in range. In fact, it has not the range to do some of the overwater hops that Qantas does. We are led to believe that the British Overseas Airways Corporation is buying the same sort of aircraft. That corporation has had regrettable experiences with the Tudor, the Hermes and the Comet I.’s, as the honorable member must be well aware, and they have been disastrous as far as the corporation is concerned. I understand that the organization is now buying very similar aircraft to the type that we are buying. Air India is buying the Boeing 707, too. Therefore, we will have a common sort of aircraft on the routes between here and England. I assure the honorable member that every attention was given to this matter, and every examination that was possible was made. It was our intense desire to use British aircraft if we could get them, but they were just not available, and in the end the choice was not between British and American aircraft, but which particular American aircraft we ought to buy.

page 568

QUESTION

UNEMPLOYMENT IN WESTERN AUSTRALIA

Mr WEBB:
STIRLING, WESTERN AUSTRALIA

– Is the Minister for Labour and National Service and the Minister for Immigration aware that married Italian workers, whose families are in Italy, have been dismissed from the timber mills at Manjimup and that, for the purpose of unemployment benefit, they are regarded as single workers and so receive only £2 10s. a week? As these men still have to keep their families, will the Minister ensure that, for the purpose of unemployment benefit, they are treated as married men?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– The matter that has been mentioned by the honorable gentleman has not been brought directly to my attention. I shall examine the facts as he has presented them and see whether, within the power available to us. there is anything that we can do along the lines that he has recommended.

page 568

QUESTION

LAND SETTLEMENT OF EX-SERVICEMEN

Mr ERWIN:
BALLAARAT, VICTORIA

– I know that the Minister for Primary Industry is interested in the war service land settlement scheme. As I myself was a soldier settler, I should like to know the amount that was expended for the purposes of the scheme in 1955-56, and the number of men settled on the land under it that year. Can the Minister give me any further information on this subject as far as my electorate of Ballarat is concerned?

Mr MCMAHON:
Minister for Primary Industry · LOWE, NEW SOUTH WALES · LP

– I am sorry that 1 cannot give the honorable gentleman the information that he seeks in relation to Ballarat, but I shall certainly see that the necessary investigations are carried out, and that the information is conveyed to him. I recently answered a question, asked by the honorable member for Scullin, concerning the general picture in relation to the land settlement of ex-servicemen. I think that over £10,000,000 was allotted by the

Government last year for war service land settlement, and that, under the scheme, between 580 and 600 people were placed on the land.

page 568

QUESTION

REPATRIATION OF AUSTRALIANS ABROAD

Mr BIRD:
BATMAN, VICTORIA

– Will the Minister for Immigration say whether it is a fact that many Australians, who are residing in England, desire to return to Australia, but do not possess the necessary financial means to enable them to do so? Is it also a fact that the immigration authorities in London have refused to assist them to return to their homeland? If these are facts, will the Government give these people the same assistance as that offered to persons of other nationalities to come to this country?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I have not had brought to my notice any case of the kind to which the honorable gentleman refers.

Mr Bird:

– I have had one myself.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– There is provision, with which no doubt the honorable gentleman is familiar, whereby Australians who are abroad and in distressed circumstances can approach our representative, or where we have no direct representative, the representative of the British Government, in order to secure assistance for a passage back to Australia. If that is the kind of case he has in mind, and if he knows of people who wish to be assisted in that fashion, we shall certainly look into the matter; but in the absence of specific cases, I am not able to affirm that we have had requests along these lines which have not been dealt with.

page 568

QUESTION

EXPORT OF MEAT TO THE UNITED KINGDOM

Mr IAN ALLAN:
GWYDIR, NEW SOUTH WALES

– My question is addressed to the Minister for Trade. In view of the fact that the Argentine, with the assistance of a devalued exchange rate, has been able to increase its exports of chilled beef to the United Kingdom by 250 per cent, during the past year, can the Minister say whether the scope of the current trade negotiations with the United Kingdom is wide enough to provide the means for Australian exporters to meet this challenge? If not, can the Minister suggest what other steps should be taken to build up a stable export trade in this commodity?

Mr McEWEN:
Minister for Trade · MURRAY, VICTORIA · CP

– Our first objective in the current trade discussions with the United Kingdom is the protection of existing Australian trade, and the case is being put for an arrangement which will ensure the protection of our trade against unfair trade advantage being secured by a competitor as the result of a decision or policy of a third party government. This covers the whole range of direct export subsidies, manipulated exchange rates, straight-out dumping, or any other device which produces unfair commercial competition for our exports. So I can assure the honorable member that that is a prime objective in the current discussions. Australia would be advantaged by a greater diversion to chilled beef exports, as against frozen beef exports, and I know that my colleague, the Minister for Primary Industry, is collaborating with the industry and the Australian Meat Board to that end. I also know that there are many really complex problems touching production, shipping, and the actual ports of shipment, and the Minister for Primary Industry is studying them at the present time.

page 569

QUESTION

OVERSEAS TRADE

Mr DUTHIE:
WILMOT, TASMANIA

– Tn view of the widespread ignorance in the United Kingdom concerning Australian products, did the Minister for Trade closely examine the advertising methods of the Department of Trade while he was overseas recently? Is he satisfied that the money being spent to popularize Australian primary products in the United Kingdom is being spent properly? Has he any further plans to extend and improve our advertising in the United Kingdom and on the Continent? I ask this question because I am concerned about the statements of businessmen and others returning from the United Kingdom to the effect that publicity for Australian goods overseas is still appallingly bad.

Mr McEWEN:
CP

– If the honorable member asks whether I myself have reached a conclusion concerning the adequacy of Australian publicity overseas, I should like to make it clear that, as a non-expert, I would never attempt to superimpose my judgment on the judgment of experts in this matter. What has been done by the Department of Trade and the Government has been done in conformity with the best expert opinion we could secure in the field of trade publicity and advertising, and of trade promotion generally. The advice I have received, from all quarters, is that the Australian publicity and trade promotional drive in the United Kingdom is bearing real fruit. No one, I hope, would imagine that a drive organized so recently, following a period of abstention from ordinary commercial trading of approximately fifteen or sixteen years, could be designed to be perfect immediately. I shall not be found claiming that that is so; but I am bound to say that the only constant complaint I get these days is that we have generated a demand for our products in excess of the quantity we have available, and I could not wish for a better kind of criticism than that.

page 569

QUESTION

IMMIGRATION

Mr WILSON:
STURT, SOUTH AUSTRALIA

– Did the Minister for Immigration notice the resolution of the Federal Executive of the Australian Labour party to the effect that the immigration intake be regulated to prevent undue strain on the economy? Is it not a fact that the present immigration plan is modified from time to time to prevent any undue strain on the economy?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I did see the text of a resolution attributed to the Federal Executive of the Australian Labour party, and there was a reference included in it to the point raised by the honorable member. I am not sure whether I had the full text, but it covered a number of other aspects, including that one. I can assure the honorable member that not only is the immigration programme adjusted from time to time according to the best assessment that we can make of the absorptive capacity of the economy, but we have sought the widest and most expert advice - including advice from representatives of the party to which honorable members opposite belong, and of the trade union movement - in preparing and planning the programme year by year. We have the Immigration Planning Council and the Immigration Advisory Council, and on both of those bodies there are representatives of the Labour movement and the industrial movement. I do not have any reason to believe that the Labour party has departed from the general policy which was announced by the late Mr. Chifley in his policy speech delivered in November. 1949, and in case some of the more recently arrived members of the Labour party have not had an opportunity to study that statement, I shall take this opportunity of reminding them of it. I believe that it is important for us to know whether, in fact, the Labour party adheres to the forthright statement made by Mr. Chifley on that occasion. He said -

Immigration means security. Even more than that-

Mr Ward:

– Is this a prepared answer?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– No. I have read the resolution of the Federal Executive of the Australian Labour party about this matter, and I anticipated that the honorable member for East Sydney, who is one of the few honorable members on the opposite side of the House who has been constantly critical of the immigration programme - unlike most of his colleagues - might have put such a question. Let me get Mr. Chifley’s words on the record, because they have a value for us in these days. He said -

Immigration means security. Even more than that, it means the full development of untapped resources, lt means greater production of goods and services. It means a better, happier, more prosperous life for every Australian.

The great immigration drive, launched by the Labour Government in 1945 and carried out with remarkable success, will be continued vigorously until Australia has the population she needs to achieve the development of all her resources and guarantee her security.

Nobody, I believe, would claim that we have as yet the population that we need to achieve the development of all our resources, or to guarantee our security, and those two great objectives announced by Mr. Chifley are still the objectives in the forefront of the present Government’s planning for its immigration programme.

page 570

QUESTION

ROYAL AUSTRALIAN AIR FORCE

Mr ALLAN FRASER:
EDEN-MONARO, NEW SOUTH WALES · ALP

– My question, about a matter brought to my attention by the municipality of Queanbeyan, is directed to the Minister for Air. It concerns the housing needs of members of the Royal Australian Air Force stationed at Canberra who are seeking homes in the Queanbeyan district. The municipality of Queanbeyan has informed me that more than 100 members of the Royal Australian Air Force stationed at Canberra are unsuccessfully seeking homes in the Queanbeyan area. Will he approach his colleague, the Trea surer, for a special allocation for service personnel of the housing funds which are available, and do his best to meet the needsof the Royal Australian Air Force personnel who are in this difficult situation?

Mr TOWNLEY:
LP

– I was not aware that 100 Royal Australian Air Force personnel were seeking accommodation in the Queanbeyan municipality, but I am quite happy to accept the honorable gentleman’s word for that. We are doing the best we can in the provision of accommodation, and the new arrangement that has been made with the State housing authorities will perhaps alleviate the position somewhat. All that I can do is assure the honorable gentleman that we are doing the best we can with the funds that are available.

page 570

QUESTION

ATOMIC WEAPONS

Mr CHANEY:
PERTH, WESTERN AUSTRALIA

– I direct to the Minister for Supply a question which concerns certain events which happened after the recent atomic explosion in the Monte Bello islands. Some cattle were destroyed as a result of an infection with redwater fever, following a period spent in staging, while awaiting the arrival of a ship that hai* been diverted because of the explosion. Can the Minister tell me whether any investigations have been made so that compensation may be paid by the Australian Government or the British Government to the persons who suffered those losses, which in some instances were severe?

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

– It is true that the shipment south of some cattle was delayed because shipping was held up before or after the last Monte Bello explosion. I understand that some of those cattle died from tick fever, which is not to say that the fever had anything to do with the atomic explosion, as indeed it had not. The British Government has indicated that it will pay compensation in proper cases where loss or damage was occasioned by the atomic operations. At the moment we are having a look at that matter, first to ascertain whether there was any association between the delay and the fever. It may well be that the cattle would have got the fever and died anyhow. We are examining that aspect and being advised. The Crown Law authorities are also examining the matter. I shall give the honorable member some more details when I am in a position to do so.

page 571

QUESTION

IMMIGRANT SHIP

Mr COUTTS:
GRIFFITH, QUEENSLAND

– I direct a question to the Minister for Immigration. As the government-owned immigrant ship “ New Australia “ has been transferred from its normal task of bringing British immigrants to Australia, and is at present being used for the purpose of transporting British troops and war equipment to the Mediterranean area, will the Minister cause representations to be made to the United Kingdom Government with a view to having “ New Australia “ released from its present war-like and provocative function now that efforts are being made to bring the Suez issue before the United Nations?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– If I may ignore the argumentative portion of the honorable gentleman’s question, I can assure the House that the Government wishes to avoid, as far as possible, any interruption in the flow of British immigrants to this country, and if we found that it was likely that “ New Australia “ would be required for any lengthy period for other purposes, we should be looking for alternative resources of shipping in order to ensure the bringing to this country of the previously planned volume of British immigrants. We are watching that position quite closely. We have, of course, already booked all available accommodation in other vessels coming here. As soon as I am able to inform the House of the future movements of “ New Australia “, that information will be given.

page 571

QUESTION

SLAVERY

Mr KILLEN:
MORETON, QUEENSLAND

– My question, which is directed to the Minister for External Affairs, relates to the recently held United Nations conference dealing with the supplementary convention on the abolition of slavery. Was the Union of Socialist Soviet Republics a signatory to the convention and. if so, may the slaves of Siberia expect an early release from their serfdom?

Mr CASEY:
LP

– The detail of the debate to which the honorable gentleman refers, and refers very properly, is not precisely in my mind, but I shall be very glad to get the complete data and let him know. I think the information would be of interest and value possibly to the whole House, and I shall certainly make a statement at a later date on this important question. The Aus tralian Government was, of course, wel’ represented in the debate, and expressed itself very freely.

page 571

QUESTION

VISCOUNT AIRCRAFT SERVICES

Mr WHITLAM:
WERRIWA, NEW SOUTH WALES

– I ask the Minister for Civil Aviation whether Australian National Airways Proprietary Limited has appealed to the arbitrator appointed under its 1952 agreement with the Commonwealth to order Trans-Australia Airlines to reduce its number of Viscount services.

Mr TOWNLEY:
LP

– I have no knowledge of that matter, and I should be very surprised if such action has been taken.

Dr Evatt:

– Will the Minister inquire into the matter?

Mr TOWNLEY:

– Yes.

page 571

QUESTION

RABAUL HARBOUR

Mr SWARTZ:
DARLING DOWNS, QUEENSLAND

– I address my question to the Minister for Territories. Have investigations been made into the possibility of salvaging war-time sunken ships in Rabaul Harbour? If so. who has carried out the investigations, and have any decisions regarding salvage been made?

Mr HASLUCK:
Minister for Territories · CURTIN, WESTERN AUSTRALIA · LP

– Two groups of wrecks lie in Rabaul Harbour. There are visible wrecks that were disposed of by the Disposals Commission to various private purchasers, and some wholly submerged wrecks that were not disposed of and which are still the property of the Administration. Tenders, which 1 think are to close in November, have recently been called for the collection and removal of the scrap material from those wholly submerged wrecks at Rabaul and at several other ports in the Territory that are the property of the Administration. Regarding the privately owned wrecks, early this year permission was given for a party of three salvage technicians from Japan, representing a Japanese company, to visit Rabaul and to investigate the general possibility ot salvage. I imagine that they were acting on behalf of the private owners of those wrecks. So far as I know, no further action has been taken following their investigations.

page 571

QUESTION

IMPORT RESTRICTIONS

Mr LUCHETTI:
MACQUARIE, NEW SOUTH WALES

– My question is directed to the Minister for Trade. I bring to his attention representations that were made during his absence overseas to his parliamentary secretary, the honorable member for Darling Downs. The representations that were made by the Clothing Trades Union, country textile factory proprietors and myself directed attention to the serious effect of import restrictions on the textile and clothing industry. As the closure of textile factories will cause very great hardship to people in country districts and, at the same time, strike a blow at our valuable decentralized industries, will the Minister indicate what remedial action he is prepared to take to safeguard the employment of essential workers in country districts? If he has not favorably considered the representations, will he now inform himself by receiving a further deputation so that the full implications of import restrictions might be considered with the object of protecting our country development?

Mr McEWEN:
CP

– I am aware of the attention that my associate, the honorable member for Darling Downs, gave to this and like problems during the time that J was absent, and which indeed he is still constantly giving. If I may be permitted to do so, I wish to pay tribute to the work that he has done in this regard. I am aware of the problems confronting, in particular, certain decentralized textile industries as an outcome of licensing restrictions. I assure the honorable member that every sympathetic consideration is given to such cases as I have no doubt he has in mind. Although I am not familiar at the moment with the particular case about which he has made representations, as a first step I shall make myself familiar with the problem and, if it seems to be advantageous to the interests concerned, I shall be glad to confer further with the honorable member.

page 572

QUESTION

ATOMIC WEAPONS

Mr ASTON:
PHILLIP, NEW SOUTH WALES

– I ask the Minister for Supply whether it is a fact that the continued delay in exploding the atom bomb at Maralinga is causing tension among personnel stationed in the area, and is costin;’ the Government thousands of pounds each day. Will he tell the House the reasons for the delay and the cost involved?

Mr BEALE:
LP

– The question of the honorable member for Phillip, if I may say so, begs the question. It assumes that there has been delay in this matter. These tests are not conducted until the scientists are completely satisfied that conditions are as they want them and that tests can be conducted in complete safety. Until that set of conditions is brought about and the scientists are ready, there is no test, so it is a bit idle to talk of delay in those circumstances. As. to the tests costing money and people being on edge, well, there are a lol of people over there. They are doing their job as they have been doing it for some months past, and I have heard no representations to the effect that anybody is on edge or troubled.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– A few people are on edge here.

Mr BEALE:

– Yes. 1 have heard no representations suggesting that the team is not a completely happy team, as it has been from the beginning. I am not aware thai this is costing anybody other than the British Government any abnormal amount of money at all.

page 572

QUESTION

INDUSTRIAL ARBITRATION

Mr WARD:

– For the information of Australian trade unions, employers” organizations, and workers, I desire to ask the Minister for Labour and National Service whether he will communicate with the President of the Commonwealth Conciliation and Arbitration Commission with a view to having prepared and released a statement giving details of the basis of determining the wage that an industry is deemed to have the ability to pay, which is now declared to be the principle upon which wage claims are determined by the commission.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– If I may answer the honorable member for East Sydney as a member of the Australian Labour party, although I have always been a little doubtful as to which camp he belonged to, and if he wants to understand the basis on which the Commonwealth arbitration tribunal has determined the basic wage, I advise him to study the very informative paper which was circulated by me to all honorable members of the Parliament recently and which traced the history of the courts dealing with the basic wage issue and set out the ground upon which its most recent determinations were made. It is quite apparent that the honorable member for East Sydney could very usefully engage upon this task because, if the reported references to what he has been telling sections of the industrial movement in this country are correct he is one of those false prophets who is determined, apparently, to lead them to economic disaster. There can be no fairer test than the capacity of industry to pay the highest wage that an independent tribunal determines. That is a policy which this Government has supported and it is the policy, so far as I am aware, that the industrial tribunal has adhered to in all its recent determinations.

page 573

QUESTION

TRADE WITH ASIA

Mr BUCHANAN:
MCMILLAN, VICTORIA

– Is the Minister for Trade initiating any immediate specific steps to cash in on the opportunity to trade with Asian countries which is caused by the cutting down of their supplies from Europe and the United Kingdom owing to the limitation of shipping through the Suez Canal?

Mr McEWEN:
CP

– The opportunities for irade with Asian or any other countries are not primarily the responsibility of the Government to discover. 1 am sure that Australian commercial interests keep themselves pretty closely abreast of new trade opportunities as they arise. However, having mentioned that as the primary force in the discovery of new trade opportunities, I am able to add that the Australian Trade Commissioner Service, with posts pretty widely over Asia, from Bombay through to Japan, is keenly in touch these days with existing avenues of trade and new avenues from whatever sources that may arise. If commercial interests feel there is any advantage in having the aid of our Trade Commissioner Service, I will be glad for all Australian trade interests to know that our commissioners are really on their toes to aid when they are called upon.

page 573

QUESTION

CANBERRA

Mr J R FRASER:
ALP

– Will the Minister for the Interior undertake to make a visit of inspection to what might be described as the depressed areas of the Australian Capital Territory or, at least, as the neglected or forgotten suburbs of Canberra? I refer to Oaks Estate, Narrabundah demountables. Causeway and Westlake. If the Minister can make such an inspection, will he give me the privilege of accompanying him so that 1 can show him much of the work that cries out to be done, and introduce representative citizens of those areas who will put a case to him?

Mr FAIRHALL:
Minister for the Interior · PATERSON, NEW SOUTH WALES · LP

– I have no knowledge of any depressed areas of Canberra unless the honorable member is applying the term in a comparative sense to some of the housing areas established during the regime of the last Labour government A little more foresight in the planning and development of those areas might have averted the tremendous maintenance problem that has to be solved by this Government. However, as my solicitude for the people of Canberra is no less than that of the honorable member. I shall be glad to accompany him.

page 573

QUESTION

SOLAR ENERGY

Mr FREETH:
FORREST, WESTERN AUSTRALIA

– Will the Minister for External Affairs, as Minister in charge of the Commonwealth Scientific and Industrial Research Organization, inform the House whether the Commonwealth Scientific and Industrial Research Organization is conducting any experiments in the practical use of solar energy in Australia for cooking, water heating and distillation of fresh water from salt water?

Mr CASEY:
LP

– A good deal of work is being done currently, and has been done in the past several years, on the utilization of solar energy for a number of purposes, particularly in the United States of America, where many tens of thousands of units for heating water for domestic purposes are in use. There is a variety of directions in which solar energy is said to be used. One is for water heating for domestic purposes and for relatively small industrial plants. Another is for cooking. It is also used for the distillation of fresh water from saline or brackish water. Some work has been done in Australia in all those fields, of which the most promising, in my personal belief, is water heating for domestic use and for small industries. There are, I suppose, half a dozen manufacturers in Australia who are making equipment, particularly for domestic water heating. Experimental work is being done on the distillation of fresh water from saline or brackish water, but I am afraid that the capital and installation costs are not encouraging at the moment. I cannot pretend that this work has been brought to finality by any means. The Commonwealth Scientific and Industrial Research Organization is working on it, not, 1 admit, on any major scale, but it has three or four scientists at work on the various problems, and it may well be that, in the sunnier and warmer areas of Australia some, or possibly all, of those utilizations of solar energy will have some practical and wider use in the future than they have at present. I know of the honorable gentleman’s interest in this matter, particularly his concern for the saline areas in the south-west of Western Australia, and his interest in the possibility of getting fresh water from salt or saline waters. I shall be very glad to keep him informed of developments.

page 574

QUESTION

SHIPBUILDING

Mr CURTIN:
KINGSFORD-SMITH, NEW SOUTH WALES

– Is the Minister for Labour and National Service aware that many shipbuilders, boilermakers and ironworkers at Mort’s Dock, Sydney, are under notice of dismissal? Is the right honorable gentleman aware also that the Australian Shipbuilding Board has called tenders for the construction of two 12,000-ton vessels, and that these tenders close on 13th November next? If so, will the Minister endeavour to induce the board to have these vessels constructed in the port of Sydney?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I shall see that the question is brought to the notice of my colleague, the Minister for Shipping and Transport. I think that is the proper course to take in relation to this matter.

Mr Curtin:

– I thought the Minister would be interested in the dismissals.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I am interested in the labour situation generally, of course, and I have given the House a picture of it from time to time. But where tenders are called for, a set procedure is to be followed, and I think the proper course, as I indicated earlier, is for me to see that the text of the question is brought to the notice of my colleague, the Minister for Shipping and Transport.

page 574

QUESTION

FILM CENSORSHIP

Mr CLEAVER:
SWAN, WESTERN AUSTRALIA

– I direct to the Minister for Customs and Excise a question which relates to the control of motion picture films. Has the Minister recently received any complaints from parents or organizations regarding the general use of films which the Commonwealth Film Censorship Board has classified as being suitable for adults only? Such films are advertised by theatres with the words “ Children halfprice “j and children are readily admitted. Is it possible for the Department of Customs and Excise to enforce the censorship classification restricting the showing of these films to adults only?

Mr OSBORNE:
Minister for Customs and Excise · EVANS, NEW SOUTH WALES · LP

– Yes, I have received complaints that cinemas in Australia admit children when they are showing films which have been classified by the Commonwealth Film Censorship Board as suitable for adults only or not suitable for children, and I have heard suggestions made that this Government should take steps to prevent children from seeing films which are so classified. I think these complaints arise from a misunderstanding of the respective powers of the Commonwealth and the State governments in this matter. This Government has constitutional authority under its customs power to prevent, and, indeed, is required to prevent, the importation into Australia of obscene and indecent works and a great variety of other such matters. In order to discharge that responsibility in relation to films, it has established the Commonwealth Film Censorship Board by regulation. The board examines films and, in the course of its examination, classifies them for the convenience of the public and of the State authorities which are responsible for the conditions under which film theatres operate. In reply to the honorable member I emphasize the fact that this Government has no authority whatever, so I am advised, to enforce observation of the classifications imposed on films by the board. They are advisory only. There is undoubtedly a responsibility to children to ensure that they do not see unsuitable films, but under our federal system that responsibility does not rest with this Government. 1 believe it rests with the State authorities and with parents, who, we all recognize, have a responsibility in this matter. It has even been suggested to me that this Government should entirely prohibit the importation into Australia of films which are riot suitable for young children if the classifications are not observed by film exhibitors, but I think that a moment’s examination of that suggestion would show that the result would be to prevent adult

Australians from seeing anything other than films suitable for children, say, eight years old; and I doubt very much whether it lies within our responsibility.

page 575

ROYAL AUSTRALIAN AIR FORCE

Mfr. GRIFFITHS__ Is the Minister for

Air aware that minor damage was done recently to property in the Williamtown area when windows were shattered by Royal Australian Air Force planes breaking through the sound barrier? Can the Minister inform me what redress the owners have in respect of replacement of the damaged property or compensation for damage? Also, can the Minister advance any logical reason why aircraft breaking through the sound barrier cannot perform their stunts either out at sea or over areas remote from habitation?

Mr TOWNLEY:
LP

– I am not aware of glass having been broken in the Williamtown area as the result of supersonic -waves.

Mr Griffiths:

– Relatives of mine are among the persons concerned.

Mr TOWNLEY:

– I am interested in the matter, because this is the first known occasion of a report that glass has been broken by a supersonic boom.

Mr Griffiths:

– It has happened in England.

Mr TOWNLEY:

– On the contrary, there is no known case of that having happened in England, and the speed necessary for an aircraft to produce the shattering of glass by sound has never even looked like being attained by any aircraft in the world to-day. I am not aware of the instance to which the honorable gentleman has referred, but ( shall have an examination made of the matter. It is not so easy as the honorable member might think to control such things, ft is true that at air stations such as Williamtown, when bombing practice and other kinds of practice are in progress, aircraft might often exceed Mach I, which is the speed of sound, and the resulting supersonic noise might be a little uncontrolled, because to pin-point a target accurately is a very difficult procedure, and only a very skilled pilot can do it. I have not yet heard, however, of any difficulty in respect of glass being broken.

Dr Evatt:

– Do the pilots take action to avoid doing such things?

Mr TOWNLEY:

– They are supposed to keep away from built-up areas. There are all sorts of rules and regulations, but, 1 might add, sound can bounce. It may hit the ground at one point and ricochet to another point.

page 575

QUESTION

INDUSTRIAL ARBITRATION

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

– I direct to the Minister for Labour and National Service a question supplementary to that asked by the honorable member for East Sydney. ls it the view of the Government that wage levels should be based on the capacity of the economy to pay, or on the capacity of individual units of industry to pay? If it be the Government’s view that the wage level should be based on the capacity of the economy to pay, will the Minister afford this House an opportunity to analyse the kind of evidence on the economic side that the Government proposes to put before the court when the next basic wage hearing occurs?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– My own understanding of the matter is that the broad determination should be on the capacity of the economy as a whole to sustain a particular wage - the highest wage that it can sustain. That matter is one which, I believe, will become of increasing importance for Australia in view of the difficulty we are likely to experience for many years to come in financing a level of imports to sustain the rate of development and the living standards of our people to the degree that we would all desire. It is becoming increasingly obvious that, if we are to do that, our manufacturing industries must be able to export a growing proportion of their production, as my colleague, the Minister for Trade, has already pointed out. It follows from that, I believe, that wages and all other cost items associated with the production of manufactured goods-

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

– Including profits.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– All those cost elements which go into the charges which are borne by the consumer, whether in Australia or in an overseas market, must be of such an order that Australia has some prospects of exporting a proportion of its manufactured products. I believe that that is the broad test.

Mr Ward:

– The Government wants a low- wage economy.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– Far from wanting low wages to be paid to workers, I can assure the honorable member for East Sydney that this Government, and the parties behind it, are entirely sincere in wanting to see the wage-earners of this country get the highest wages and the highest living standards that our circumstances can make available. However, what some honorable gentlemen opposite have never appreciated, apparently, is that the test of what a wage is worth is what the wage will procure in terms of goods and services, and not merely its nominal value. It so happens that this Government has been in office during a period when the basic wage has been the highest in money terms, and also the highest in real purchasing value, and we want to keep it that way. We recognize, however, that there is a danger point and, so far as some of our industries are concerned, I believe we have reached that point, or are very close to it, with the wage and cost level becoming such that the export of some goods is impracticable, and our capacity to import the raw materials and equipment required for our growing secondary industries is endangered as a consequence. The honorable gentleman asks me what kind of evidence we shall be presenting to the Arbitration Court at the next basic wage hearing. I cannot give him a precise answer to that question at this stage, because the matter has not arisen for Cabinet consideration, but I would assume that the general approach I have indicated would be an important element of any submission made by the Government to the court at that time.

Mr SNEDDEN:
BRUCE, VICTORIA

– ls the Minister for Labour and National Service aware that Jackie Brown recently lodged a log of claims on behalf of the Australian Railways Union, containing extraordinarily high claims for wages - such as would advance a clerk’s salary to exceed £5,000 a year? Does the Minister expect that this log of claims will be withdrawn following the outlawing by the Labour party of unity tickets in trade union elections?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– Dealing with the second part of the question first, I am quite certain that we were all delighted to see that some responsible members of the Labour movement had realized the dangers into which they were taking themselves, and the country, by short-sightedly alining themselves with members of the Communist party for the purpose of trade union elections. However, I do not think a log of claims excites very much interest or concern other than as an indication of the bargaining point from which the parties concerned with the log propose to start negotiations. It is not unusual to see requests for what most of us, I think, would regard as quite impracticable demands or requirements, being made in logs of claims lodged with our arbitration tribunals. I should imagine that the log to which the honorable gentleman has referred was presented in that light, and that we can rely on the good sense of our arbitration tribunals to determine both what is the highest wage and the best set of conditions that industry can afford to provide in this instance, as in others.

page 576

QUESTION

ATTACK ON INDONESIAN OFFICIAL

Mr WEBB:

– Can the Minister for External Affairs advise me whether an attack made on an official of the Indonesian Embassy, while he was attending a meeting at the New South Wales University of Technology, was organized by one of the persons who were recently gaoled for contempt of this Parliament, and who is now leader of the Australia party? If that is so, has any action been taken against this person, and what steps are being taken to prevent a similar unpleasant situation from arising in the future?

Mr CASEY:
LP

– I understand that the honorable gentleman’s premises are correct. Any action to be taken in respect of the incident was a matter for the authorities of the New South Wales University of Technology when the abuse took place. So far as action that this Government can take is concerned, I can say that the Acting Prime Minister wrote to the head of the Government of New South Wales asking that the New South Wales police might be very vigilant in future - not that they have been other than vigilant in the past - when incidents of this sort might take place. It has also been requested that when any speech is to be made by a diplomat on any subject that might create a similar problem, both the Australian Government and the New South Wales police be warned in advance. In other words I think that everything thai could be done properly has been done to prevent a repetition of this grievous incident.

page 577

QUESTION

TELEVISION FILMS

Mr DEAN:
ROBERTSON, NEW SOUTH WALES

– 1 desire to ask the Minister1 for the Interior a question concerning the films unit of the News and Information Bureau. Honorable members are aware that the bureau has made excellent documentary films, and I now ask the Minister whether it is intended to widen the scope of the bureau to enable it to make films for television purposes. If no decision has been made in this matter, would he be good enough to have inquiries made and let me know the result of those inquiries?

Mr FAIRHALL:
LP

– No plan of campaign tor the production of television films by the films unit of the News and Information Bureau has been embarked upon. A certain number of the films that have been produced in past years by the bureau are to be made available for television, but the prospect of the Government entering into the production of television films is one that will call for a lot of careful thinking.

page 577

QUESTION

COMMONWEALTH NEW GUINEA TIMBERS LIMITED

Mr CURTIN:

– My question is directed to the Minister for Territories. Is it a fact that the Commonwealth Trading Bank has opened a branch at Bulolo, New Guinea, as from 27th August last? If so, can the Minister inform the House whether the Government intends to transfer the trading account of Commonwealth New Guinea Timbers Limited, whose account is now operated through the Bank of New South Wales, to the Commonwealth Trading Bank?

Mr HASLUCK:
LP

– It has been the policy of this Government to allow the business operations of Commonwealth New Guinea Timbers Limited to be conducted in the way that business operations are normally conducted, that is. by the board of directors of the company.

page 577

QUESTION

POSTAL DEPARTMENT

Mr WARD:

– I ask the Minister for Labour and National Service whether, in view of the Postmaster-General’s undertaking to expedite a further hearing by the Public Service Arbitrator of the claims of

Postal Department employees for wage adjustments, he will ensure that the Arbitrator is advised that his function is to determine the application on the basis of justice and equity and not on the ground that the state of the economy will not permit a favorable decision. Does the Minister agree that the amount the economy can afford is a matter for parliamentary determination and is not the function of the Public Service Arbitrator?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– My colleague, the Postmaster-General, who, 1 think, should receive the thanks of us all for the manner in which he has handled a very difficult situation, made quite clear the attitude of the Government in relation to this matter. A wages claim has already received consideration by the Public Service Arbitrator, and if any fresh circumstances can be brought to his notice, no doubt that will be done. The Government, however, has stood throughout for the operation of the normal processes of arbitration in this matter. It has no desire to instruct the Arbitrator, nor would it be proper for it to instruct him, as to how he should conduct his own hearing, but it is the wish, of course, of the Government that employees of its various departments should at all times receive pay and enjoy working conditions which accord with equity and justice, and which are in line with those obtaining throughout the rest of the community.

page 577

QUESTION

TELEVISION SETS

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– My question is directed to the Postmaster-General. Is it a fact that the Admiral Television Company has discontinued the use of 21 megacycles frequency and has adopted 40 megacycles frequency in its television sets which are at present being sold in the United States of America? Has the Admiral Television Company in Australia recently promised to discontinue the use of 21 megacycles frequency in its television sets offered to the Australian public and to adopt the 30 megacycles frequency recommended by the Australian Broadcasting Control Board? If so, has the company promised to withdraw its unsold 21 megacycles frequency sets? Further, has it given any undertaking to change the frequency of sets already purchased to comply with the standards recommended by the Australian Broadcasting Control Board?

Mr DAVIDSON:
Postmaster-General · DAWSON, QUEENSLAND · CP

– The House will remember that I have made several statements dealing with the investigations that have been made by the Australian Broadcasting Control Board into the likelihood of interference with reception if the standards laid down by the Australian Broadcasting Control Board were not complied with. The statements I made were quite clear and indicated that at that time one company was producing television sets which did not conform to the standards recommended by the board. I, therefore, issued certain warnings to the people as to the possibility of interference which could be suffered. At that stage, as 1 announced previously, my responsibility in the matter ceased. The people have been warned, and at present I have no information as to what the company is doing save that, as was stated previously the company did give an undertaking that from a certain date the components to be imported would be of a nature to enable the sets to conform to the standards laid down by the board. Any further investigationlies outside my province, but it may come within the province of my colleague, the Minister for Trade. I have had discussions with him and I can assure the House that the Government is watching the position and can be relied upon to ensure that the interests of the people generally shall be safeguarded although, at the same time it is not prepared to intrude improperly into the operations of private enterprise.

page 578

ATOMIC RADIATION

Dr. DONALD CAMERON (Oxley-

Minister for Health). - On 20th June, the Leader of the Opposition (Dr. Evatt) asked the Minister for External Affairs (Mr. Casey) whether he would endeavour to coordinate available information on the effects of atomic radiation, including the explosion of nuclear weapons. This information has been collected by the Department of Health and, at the request of the Minister for External Affairs, I now lay on the table the following paper: -

Biological Effects of Atomic Radiation- Statement by Minister for Health.

I wish to inform the House that a copy of the recent report of the United Kingdom Medical Research Council, together with the recent report of the United States

National Academy of Sciences, upon the same subject has been placed in the Parliamentary Library.

page 578

QUESTION

SUEZ CANAL

Mr. CASEY (La Trobe- Minister for

External Affairs). - by leave - I wish to inform the House that the Governments of the United Kingdom, the United States of America and France have proposed a meeting of the eighteen nations which supported the proposals recently put to the Egyptian Government by the mission headed by the Australian Prime Minister. Australia has been invited to take part in the conference, which will be convened in London on 19th September. The conference will be considering three items -

  1. The report of the Menzies mission to Cairo.
  2. Colonel Nasser’s proposal to set up a negotiating body.
  3. A proposal for the United Kingdom, the United States and the French Governments for a co-operative association of Suez Canal users. 1 propose to say a few words about the third item. As honorable members will be aware, the Acting Prime Minister (Sir Arthur Fadden) has announced that the Government supports the concept of this plan. The idea behind this proposal is to find suitable machinery of a temporary nature to protect international rights in the canal until such time as a more permanent system can be achieved. These international rights are guaranteed by the Suez Canal Convention of 1888, and that convention, in conjunction with the concessions granted to the Suez Canal company, have constituted a balanced scheme which for over 80 years has protected the rights both of Egypt and of the users of the canal and has universally commanded international confidence. That balance has now been destroyed by the unilateral nationalization of the company. We see the concept of the proposed co-operative association, therefore, as a means of meeting the urgent need to protect international rights in the canal under the 1888 Convention.

The Australian Government has accepted the invitation to participate in the conference opening in London to-morrow, and has appointed Sir Percy Spender, the Australian Ambassador in Washington, to lead our delegation. Other members of the delegation will be the Acting High Commissioner in London, Sir Edwin McCarthy; Mr. A. H. Tange, Secretary of the Department of External Affairs; and Mr. L. R. Mclntyre, the senior External Affairs representative in London.

Dr EVATT:
Leader of the Opposition · Barton

– by leave - I do not want to become involved now in too detailed an analysis of any of the plans for the settlement of the dispute, but, on behalf of the Opposition, I want to make the point that the matter is becoming more complex and confused. First, we had the proposals approved by eighteen of the 22 nations summoned to the London conference. Those proposals - the Minister was correct in describing them as proposals rather than as a basis for negotiation - were taken to -the President of Egypt and were rejected by him. In reply, the President of Egypt suggested a wider conference of, I think, about 60 nations to consider an alternative plan. Then a proposal was put forward by the United States of America, the United Kingdom and France for a co-operative association of Suez Canal users. The concept of that plan, which is very interesting, is supported by the Australian Government. The concept is a good one. The objective hs that, although Egypt controls the canal, all other nations with a right of passage under the Convention of 1888 shall exercise their rights. But, when we look at the plan in detail, it seems to be unworkable, or almost unworkable. At any rate, great difficulties will arise.

These competing plans are floating around, but the parties do not meet face to face. The difficulty with which the Prime Minister of Australia was faced in Cairo was that he was limited to the function of saying, “These are the proposals of the eighteen nations. Will you agree? “. The answer had to be either “ Yes “ or “ No “. Negotiation was not possible. I emphasize again the complexity of the matter, the confusion caused by varying plans and the fact that there is no negotiation, properly so called, going on. Various plans are being put forward, but there is only one place where all plans can be looked at together in the presence of all concerned. That is the United Nations. The trouble ;at the moment is that so many nations are avoiding or by-passing the one body which could secure consideration of the various plans by all parties to the dispute, and also by other nations. On behalf of the Opposition, 1 again stress to the Government that the dispute will have to be taken to the United Nations sooner or later. Meanwhile the danger of the use of force becomes greater. So let it be done sooner. Let it be done at once.

page 579

DISARMAMENT

Mr SPEAKER:

– I desire to inform the House that I have received a communication from the Supreme Soviet of the Union of Soviet Socialist Republics transmitting an appeal of the Union of Soviet Socialist Republics Supreme Soviet to parliaments of all countries of the world on disarmament.

For the information of honorable members, I am arranging for the letter and its enclosure, together with translations, to be placed on the table of the Library.

page 579

QUESTION

BUDGET 1956-57

In Committee of Supply: Consideration resumed from 13th September (vide page 564), on motion by Sir Arthur Fadden -

That the first item in the Estimates under Division No. 1 - The Senate - namely, “Salaries and allowances, £26,500 “, be agreed to.

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

That the first item be reduced by £1.

Mr KEARNEY:
Cunningham

.- When the Treasurer (Sir Arthur Fadden) walked into this chamber three weeks ago to introduce his ninth budget, the people of Australia expected - and rightly so - that the budget would reveal a national plan to stabilize the economy of our country, to stop inflation, on a basis of social justice to all sections of the community. The people who voted this Government into power had every right to expect the Government to measure up to its responsibility to halt inflation, to put value back into the £1 - to honour the promise upon which it was elected. The Government has failed miserably, completely and utterly to discharge its responsibility.

Inflation, which gained momentum after the defeat of the Chifley Government in 1949, is now in full flight. The repeated failure of the Government, with its un-Australian outlook, to grasp the nettle of reality, to seek to understand the causes of inflation and to take corrective action is again revealed in this budget. The Australian people to-day are firmly fixed in the seats of a juggernaut, careering unrestrained into an economic blizzard. This is a stupidly unnecessary condition, productive of wide community hardship for the many and of cruelty to people dependent upon social services payments - the aged, the widows, and the invalids - the families of the average wage-earner and those dependent upon fixed income. Throughout the length and breadth of our nation to-day the accusing fingers of those millions of little people point at this craven Government which, during this debate, has been stripped of the glad rags of falsehood and deceit and now stands shivering before the bar of public opinion, exposed for what it is - a class government, an implement ready to do the bidding of its masters, the monopolies, the cartels, the rapacious profiteers, the overseas investment pirates and the gunboat tories of England. How well does this Government of reaction serve the elements I have named. Profits have increased year by year and are now inflated to record proportions. Australia is in the throes of a profit inflation. The Leader of the Opposition (Dr. Evatt), in his brilliant unmasking of this craven Government, referring to the magnification of profits, said -

Compared with wages, the position amounts to a scandal.

And a scandal it surely is! That is reflected in and borne out very effectively by published statements of the profits that have flowed from Broken Hill Proprietary Company Limited. The Broken Hill organization doubled its profits, while wages were pegged, in the last twelve months. It secured a working profit of £21,500,000 and a net profit of £6,500,000. At present an application is being heard by the Arbitration Court to vary the award covering workers employed by the Broken Hill Proprietary Company Limited. An increase of wages is sought. The hearing commenced last week, and the first assertion made by counsel on behalf of the company was that any claim, at this time, for increased wages would disturb the economy. The profits of that vast organization, the Broken Hill Proprietary Company Limited, are balanced, on the other hand, by the notorious profits of General Motors-Holden’s Limited. Any newspaper of recent date shows, in its financial columns, the profit gains of various companies. I shall quote at random from the report of company profits appearing in the “ Daily Telegraph “ of 8th September last. One paragraph is as follows: -

Dunlop Rubber Company of Australia has raised its dividend following a 20 per cent, rise in profit for the year to June 30. Profit, shown in a preliminary Statement, is £1,293,879. This compares with £1,072,909 for the previous year.

That represents a vast profit. Then there is the heading, “ 54 per cent, more profit for Kande “. That is the firm of kitchenware manufacturers. Another paragraph shows that the profit of Grimley Limited, motor accessory distributors, increased, and the net profit this year was £39,373 as against £37,207 the previous year. Under a heading, “ Winchcombe profit and dividend fall “, the opening paragraph reads -

Net profit for Winchcombe Carson Ltd. again fell slightly by £4,661 to £200,417.

Another caption is, “ Malleys Good Year “. The report reads -

Malleys, Ltd., and subsidiaries made £174,352 net profit for the year ended June 30, compared with £128,952 for the previous year.

The rise was equal to 35.2 per cent.

Yet we cannot obtain a shilling a week increase in wages. That is an example of the profit inflation to which the leader of my party so brilliantly referred and so completely exposed. It shows how this Government of reaction serves these companies whose profits have increased year by year, and the figures I have just cited give an indication of exactly what I conveyed to honorable members in this chamber on earlier occasions. The broad picture shows that company profits increased from £378.000,000 in 1952-53 to £505,000,000 in 1954-55, an increase of £127,000,000, or 30 per cent, in two years. This was sheer profiteering during a period when the basic wage of the workers was pegged. Included in that £505,000,000 profit for the year 1954-55 was a sum of £187,000.000 in undistributed profits, and also money used for further expansion or added to reserves.

Coupled with this condition - a leap to a 33 per cent, increase in company profits - the income of the farmer dropped by 19 per cent, and the cost of living increased by 6 per cent. The cause of inflation of this country is emphasized when we understand that the average earnings by way of wages in 1955-56 were only 6 per cent, higher than in the previous year, and only 17 per cent, higher than for the three previous years. In the same three-year period in which wages increased by 17 per cent., there was a 33 per cent, increase in dividends and at least a 45 per cent, increase in company profits. These figures supplement the details of the profits of the small handful of companies whose returns 1 just touched upon. The same picture can be seen by consulting any financial journal in any part of Australia in respect of any industry. The same vein of gold is running through the whole ambit of company activities in this country, but at the same time the business concerns that employ the people who make possible those profits keep their employees down on their economic knees. They have not been able to lift their heads to make a claim for more real money. Basic wage freezing has seen to that.

As the Leader of the Opposition has said, foi every £10 paid out in wages last year, more than £2 was paid in company profits and £7 for profits of all sorts. There is no escape from the truth of the position that while profits have been allowed by this Government to soar to scandalous proportions, only the crumbs have fallen from the rich man’s table to the wage-earners of this nation. We of the Labour party and the t, ade union movement reject and condemn, and will continue to resist, the continuance of this iniquitous financial system under which the men and women of Australia have been driven as hewers of wood and drawers of water for the soulless, selfish profiteers in our midst. The responsibility rests fully upon the Government, and each member on the Government side is in the ranks of the guilty men who give official support to profiteering, which is the cause of the high degree of inflation that results in frustration and destruction. Absolute privation and needless cruelty are being inflicted upon the defenceless people who are dependent upon social service payments or fixed superannuation incomes.

The Liberal party, numerically the dominant force in the present Government, has revealed once again in this budget that it has no plan - much less a national plan - to control the economic affairs of this coun try. This party, in its approach to modern national needs, is wearing the sidelevers of the Gladstonian period, and is hugging to its breast a policy of laissez faire. Whether the rank and file members of the Government parties recognize it or not, their true role in this Parliament is to resist change, to enforce the control necessary to prevent change, to preserve for the privileged all their existing privileges and to deny social justice to the many. It is only when the heat of public hostility puts the fear of loss of control into their marrow bones that we find their vaunted concern expressed in a concession. To-day, the control of this Parliament by the Liberal party, by virtue of its numbers, necessitates no concession, but when the next election looms some concession will be made. The utter contempt of the Liberal party majority is expressed by its heartlessness in refusing to raise the income of the age pensioners by even one penny a week. Yet it ladles out £6,000 from the public purse to a former spy. Petrov.

Impelled by the same contempt, it sponsors a plan to foist on the family wageearners of this nation, both old and new Australians, the responsibility of inflation, and seeks to impose wage reductions, lt would take food from the table of our families to feed the maw of the greedy. In his “ Reflections of an Australian Liberal “, Sir Frederic Eggleston was not hesitant to affirm that -

Similar groups-

Referring to pressure groups generally - with a more shadowy organization but definite economic interests also stand behind the Liberal party, although the Liberal party can never be sure of their support.

Later he wrote -

It is a miscellaneous party with a loose organization, without substance between elections . . . Naturally, in these circumstances powerful financial interests who contribute to party funds have considerable weight.

That is the dominant party in this Parliament to-day, acting at the behest of what Sir Frederick Eggleston termed “ groups with a more shadowy organization but definite economic interests “. The LiberalCountry parties sponsor economic factors to develop the plans of their masters - big business.

He was a dyed-in-the-wool Liberal, who for many years exercised a powerful voice in the inner sanctum of that party. When wc turn to look at the hind-quarters of the Government’s strength in this Parliament - the Australian Country party - we see, clearly again, the grouping of vested interests. That party was formed on the basis of the organizational text-book of the Australian Labour party. The Australian Country party has always been purely a parochial party, out to protect the larger financiers who find profit in rural production, and to protect the land values of the speculators. It is essentially a pressure group carrying on a great masquerade in the country districts which have not yet wakened up to its leg-pull. The Australian Country party is the harlequin of Australian parliaments. Sir Frederic Eggleston also said that the Country party was the “ machinery of vested interests “. Referring to its liaisons with the Liberal party - quarrelsome and often bitter bedmates as they have been - he said -

The Country party were a party of small freeholders, whose members thought far more of the selling value than the agricultural value of their land.

They were interested in putting up the price of agricultural produce, including food, and resisting the extension of Wages Boards, and industrial awards to country districts.

Once the Australian electorate becomes aware of the real purpose of the Government parties it will appreciate, quite simply, that the welfare of the great majority of the Australian people is regarded by them as being in no way their concern. Indeed, the Government is concerned solely with obtaining financial gains for vested interests, and the budget, in common with the enactments of the last session and earlier periods, is aimed only at benefiting these wealthy supporters.

This form of class government is bringing this young nation to its knees. No section of the community, realizing this, can fail to condemn the socially cruel and unAustralian policies of the Government, which should resign and face the people. Tt has failed as a government.

Since the budget was presented, it has been criticized from one end of Australia to the other. The criticism has come from all classes of people, and indicates the public’s disapproval of the Government’s failure to face up to the disastrous effects of its sub-standard economic policy. What are some of its influential friends saying?

The leading article in the Melbourne “Herald” of 5th September, 1956, made this trenchant criticism -

This year’s budget makes such a dreary, negative approach to national problems, that the Opposition should be able to score effectively from it in debate.

We have done just that. The leader continued -

It is wide open for any critic wilh the alternative of a positive policy for a growing nation with needs to fill and work to do.

Dr. Evatt did hit at the failure of the budget to recognize the plight of the pensioners. Something should have been done for them.

That is obvious. It is what everyone in Australia, irrespective of his political persuasion, is saying. The public should note this further devasting condemnation of the Government by the Melbourne “ Herald “ -

Whilst the Government juggles with £1,200,000,000 of money in a grand extravaganza it denies one penny piece to the pioneers of this nation.

Let the electors who return the Government demand of it, “ Where is the milk of human kindness that most people nurture in their bosoms? “ It is not too late, even now, for Government supporters who are hiding behind a stolid silence on this subject, to revolt against the Government and force upon it recognition of the plight of the pensioners. Throughout this debate they have scuffled out of earshot of the constructive criticism that has come from this side of the chamber. The empty Government benches that I see before me only confirm what I am saying. We are dealing with national issues, and the stake is the welfare of our people. There can be no honesty in evasion of this fact. lt has been reported to me that the Treasurer (Sir Arthur Fadden) told the recent deputation of pensioners that their case had brought a lump to his throat. Such arrant hypocrisy should not go unnoticed. The pensioners want bread, food, warmth and shelter, not a mere lump in the Treasurer’s throat. We may well echo the published statement by Sir Frank Richardson, the federal president of the Australian Council of Retailers, that the fact that the pensioners were to get no rise was unbelievable. That statement was reported in the Melbourne “ Herald “ of 31st August, 1956. One could hardly describe Sir Frank Richardson as a Labour supporter.

In the field of finance there is no more responsible journal than “ Jobson’s Investment Digest “. The political slant of that journal is anti-Labour, but I draw attention to some statements made in its issue of 9th August. The first is -

The next federal budget is not far away. Unfortunately there is little evidence that the Government will use it as a means of fundamentally changing economic policy. Events day by day arc painfully demonstrating that neither the domestic problem of inflation nor the external problem of our balance of payments is making much progress towards a solution.

That prophesy was made in August by this leading financial journal, which no one could describe as being pro-Labour. Another interesting passage is as follows: -

But we should be blinding ourselves to the facts if we did not add that the present Federal Government has been painfully slow in diagnosing the particular economic problems now confronting us and even less active in finding solutions to them.

That is a complete condemnation of the Government’s failure to face its responsibilities and look after the nation’s affairs. This Government’s utter contempt for the wishes of the people is expressed by its complete heartlessness in refusing to augment the income of aged pensioners.

I wish to deal now with an important phase of governmental administration in this country. 1 refer to local government, i he base upon which the State and Commonwealth legislatures rest in providing essential services to the community. Without the financial resources needed to maintain and extend ever-developing services, local government cannot operate effectively. At best the growth of those services must be stunted, and the people denied the essentials of our modern and improving way of life. Local government has a right to a greater share of the revenues collected by the Commonwealth. This important question is facing all governments, and this Government in particular.

Broadly, civil organizations should have financial resources matching their obligations.” They should have more adequate finance for capita] works and the construction of roads of a high standard. Tt is clear that the revenue obtained from the rating of land must be augmented by a share of the general taxation gathered by the Commonwealth Government. The all-party committee which has been set up by this Parlia ment to study the Federal Constitution should take evidence from the recognized local government organizations to ensure the removal of any barrier to the provision of finance to civic bodies by direct subsidy or other means. This Government should use its powers to give, by way of loan funds, immediate relief to local government, the normal revenues of which are quite unable to meet the demands arising from industrial expansion and housing development. The critical fact is that a retrograde policy prevails, and that each year the total loan allocation is reduced. This is a Gilbertian situation, which is creating a disastrous state of affairs and bringing to a standstill development in some areas such as Greater Wollongong.

In view of the prevailing conditions in the jungle of finance, local government is unable to obtain adequate loan funds. This has been caused by the greater attractiveness of private issues. Private enterprise, with its ability to make greater profits, is free to offer interest rates in excess of 51 per cent., which is the limit imposed upon local government. While this condition remains - and for all this Government cares it could remain for ever - most available loan finance will be grabbed by private enterprise sharks who hunger for profits and more profits. The owner of money sells it where it will bring him the greatest return. This insane situation will continue until it is stopped by force of law. I would like to read to honorable members the headings to an article which recently appeared in the press - “ Face lift “ for P. Kembla hotel.

Tooth and Co. plan a £45,000 “ face-lift “ for the Commercial Hotel. Wentworth Si., Port Kembla.

Money is available for spending on a large scale by private enterprise, but the ordinary member of the community who seeks a small loan of £1,000 or £1,500 with which to buy a home usually cannot obtain it. High finance will not provide money for homes, but in this case £45,000 is available readily to give an hotel a face-lift. That is the kind of financial transaction that I am referring to. It is apparent throughout my electorate that money is available for all kinds of private enterprises except home building. Let the man in the street try to obtain a mere £1,000, even though he has excellent security, and he will find that he is not in the race. That state of affairs is due to this Government’s economic controls. The Government must accept the responsibility for the position, because the electors of Australia voted it into office on the understanding that it would solve our economic problems.

I shall now make some comments about the position in the Greater Wollongong area, which is situated in the electorate of Cunningham. The Greater Wollongong Municipal Council has the civic responsibility for Australia’s fastest-growing community, which is based on the greatest steel-producing area in Australia. It is the centre of the electorate that I represent. The council is usually allotted about £480,000 a year in loan money, but in this year the amount has been reduced to the fantastically small figure of £350.000. That is the kind of financial policy that the Government is pursuing, a policy of retrenchment and restriction. It is absurd to reduce the council’s allotment in that way, when there are in this area industries which, in 1955, turned out products valued at more than £31,000,000. I might also mention that the unimproved capital valuation of land for 1956 is £24,637,374, and that the population is 102,000 and is increasing by 6 per cent, per annum. Despite these facts, the financial controls imposed by this Government have produced a situation in which the council’s allocation of loan money is drastically reduced. It is a preposterous state of affairs. The official attitude of this Government is that the problem is one solely for the Government of New South Wales, and that local government is the creature of the State. Such an attitude is unreal. The Commonwealth controls the purse-strings, and it must realize its responsibilities to this council and to all other civic authorities that need finance to carry out essential and organized developmental works.

The reduction of the loan allocation from £480,000 to a niggardly £350,000 will make the difficulties of the Greater Wollongong Municipal Council almost insurmountable. For the last nine years the council has struggled to catch up with the lag in necessary local works that arose during the war years, and at the same time to keep abreast of the extraordinary post-war development. Without adequate finance at this time the task is virtually hopeless. Restriction of industrial development and matters pertaining thereto can only result in a severe setback to the nation’s progress.

What is happening to the wealth produced in this country? Is it going into the pockets of the few? That is the issue arising from this budget as the people see it, and the people know that the answer to the question is “ Yes “. Official statements issued by the Greater Wollongong Municipal Council make it clear that if it is denied the money necessary to augment its. normal income, such works as the Port Kembla sewerage system and the construction of heavy duty roads that are necessary to handle heavy industrial traffic must cease. The council will be unable to provide many health services that are now available to residents of the area. Among them are diphtheria immunization, vaccination against poliomyelitis, maintenance of blood banks and chest X-rays for detection of tuberculosis. The council will also have to curtail its activities in the provision of an electricity reticulation service for homes and industrial undertakings, and it will be unable to provide adequate parks and playgrounds. For all these things the Government must accept responsibility, because of its restrictive financial policy.

If the council decided to carry out the works and services that I have mentioned, even though its loan allocation has been reduced, it would have to treble the municipal rates, which are already at a high level. The Government, and this committee, should remember that the City of Greater Wollongong is the third largest industrial city in Australia, and is the greatest steel-producing centre in the country. The position is so seriously affecting our great steel industry that the whole national development of Australia must be affected consequentially. Steel is the very basis of Australian secondary industry. It is essential in the manufacture of goods from nail files to motor cars. It is the basis of the shipbuilding industry and is of vital importance in all kinds of constructional works and in our defence activities.

Because of the financial policy that this Government has pursued, and which it refuses to alter even when confronted with a position such as I have outlined, a comparative handful of ratepayers are required 10 bear the main expense for the construc tion of roads and the provision of numerous essential services, and the welfare of 10,000 men in the steel industry and allied industries is jeopardized. Let me quote an official statement made by a responsible financial officer of the Greater Wollongong Municipal Council -

We have been a tolerant people, in that we have not pressed the Government for grants. We have been content so long as we could borrow, even though this meant a greater burden on the people. But now we can secure neither grants nor loans sufficient for our requirements.

That statement vividly illustrates the plight of Australia’s third largest provincial city - the hub of the wealthy and important steel industry. This is a national problem, and sooner or later this reluctant Government must face the facts as they exist, or leave it to the coming Labour government to do what the present Government refuses to do - take action to ensure finance for all national needs.

Mr KENT HUGHES:
Chisholm

– The Treasurer (Sir Arthur Fadden) has received many congratulations, from both sides of the chamber, on the numerical record that he has established in the matter of budget presentations. I join in those congratulations very warmly, but at the same time I have very great sympathy for him because of the difficult position in which he is placed. 1 understand that the budget debate is due to end at about .10 o’clock to-night. This is rather a pity, because I am sure that every honorable member would very much like to hear the Prime Minister’s assessment of our present economic position, or what he has been pleased to describe in the overseas press as “ my rather battered domestic affairs “.

The document that the committee is discussing is simply an extension of the little budget which was introduced by the Prime Minister, in his position as Acting Treasurer, some six months ago. 1 can well understand that the Treasurer had no alternative but to introduce a budget of this kind in the present circumstances. It has been called a “ stay-put “ budget, and the Treasurer’s own description of it was a “ hold-the-fort “ budget. This latter term reminds me of the good old Salvation Army song, “ Hold the fort, for I am coming “, but I doubt very much whether we shall achieve economic salvation with a budget of this kind. It is an optimistic budget, and I hope its optimism is justified. A fortuitous turn of fickle fortune’s wheel, such as the discovery of widespread oil deposits, would, no doubt, help a great deal, but 1 am not prepared to roll the bones or play dice with fortune, when so much is at stake. That is why 1 dislike parts of this budget.

Fortune has been very kind to Australia. We have had our seven fat years, and we should remember that we have also had seven successive quarterly increases. The last increase of 2.6 per cent, in retail prices is the highest since June-July, 1952. When the little budget was introduced, I, like most other people, was prepared to give it a go. I think most of us later agreed with the following statement, which appeared in the August issue of the Bank of New South Wales Review: -

The Commonwealth still has an opportunity in its own Budget to lighten the burden of Government activity. In default, the full deflationary force must fall on the private sector on whose productive prosperity the welfare of the nation finally depends.

Before I proceed to discuss the budget, 1 should like to say, in case honorable members opposite expect to derive any comfort from my remarks, that I intend to vote for the budget. Not for many a long year has a Leader of the Opposition failed so lamentably in criticism, either destructive or constructive, as did the right honorable member for Barton (Dr. Evatt) a fortnight ago. Not for many a long year has the Labour party been so devoid of any economic policy. Its vision cannot extend beyond the barren ridges of rigid controls, controls so severe, sardonic and strict that they would lead to complete regimentation and would differ only in degree from the economic policy of the Union of Soviet Socialist Republics. I was in America last month, and I could not help but be impressed by the difference between the outlook of trade unions in America and that of the trade unions in Australia. In America, the trade union officials are all out for incentives and for increasing national production because they realize that is the way to increase the standard of living of the whole community. They agree with the article written on the Labour party in the “Economist” of 14th July, the last paragraph of which reads -

The over-riding recipe for more social justice and for economic betterment is, on every count. the growth of national wealth; and every prescription for “ reform “ which hinders instead of helping that growth denies the very purposes for which the Labour party, in the radical tradition, claims to exist. The green light should be for expansion, not for envy.

What do we find with the Australian trade unions? We simply find the imposition of dargs in order to slow down production, in America, the ambition of every trade union leader is not to become a member of Parliament. There, trade union officials spend their lives trying to run their trade unions efficiently, and they succeed in doing so. Here, we find dargs being imposed by the unions and when we come into this Parliament all that the union representatives can suggest for overcoming the present economic situation is regimentation and controls. I am also rather mystified as to why in Australia, where there is less class distinction than in any other nation I have visited, the unions base most of their policies and advocacies upon class hatred.

Now, let us turn to the little budget. The pattern for this budget was set when the Prime Minister introduced the little budget, and nobody will quarrel with his -statement on that occasion that -

To achieve economic health we must clearly increase out output or reduce our demand, or both. . . . Any increases in taxation should be designed as far as possible to reduce inflation. [t is said that fine feathers make fine birds. Here, we have a fine purpose expressed in -fine words, but what has become of that purpose? As far as can be ascertained, the results achieved have been most disappointing. If we examine the position, we discover that the Government has achieved certain -successes on which it should be congratulated. It has achieved success in reducing the consumption of beer and the sales of motor cars; it has achieved success, by way of increased revenue, in avoiding the financing of deficits from central bank credit; it has had better success in the loan market as the result of the increase in interest rates, and I understand it has also achieved success in stopping the rot in the balance of payments overseas as between imports and exports; but, whilst congratulating the Government on those victories, we must, at the same time, remind ourselves that the last victory has been won at the expense of many small export and import industries, by running down our stocks, by sheltering uneconomic and luxury industries and, with other side effects giving the spiral of inflation a further nasty twist. It undoubtedly has added to inflation. When we add to that the increased company taxation, which in turn has increased prices; when we add the increases in sales tax and excise which in turn have increased costs and therefore added still further to prices; and when we add the increased petrol tax plus the higher rate of sales tax on motor cars, which together have increased the cost of transport, we cannot help but admit that the net result of these victories unfortunately has been to add very considerably to the spiral of inflation.

When we realize that the increased revenue has been swallowed up by increased expenditure, it is not surprising to find that the horses of inflation have increased their speed, and, if we are not very careful, will soon attain a rate that any Melbourne . Cup candidate might well envy. There is nothing inherently wrong with harnessing the horses of inflation to the State coach in a period of expanding economy, but they must be kept on a curbed rein. The great danger is when you lose control of the reins, are afraid to apply the brakes and consequently are left with nothing to do but hang on to our seats. Actually, twelve months ago, I considered their speed broke the sound and sane barrier. I do not know whether honorable members will agree or disagree with all that I have said, but it i«, certain that not one member of this Parliament, even if present wool prices are maintained or increased, views with equanimity the signs and portents in our economic sky any more than does the writer of the article I have quoted from the August “ Review “. The Treasurer tells us thai the danger lies in the fact that farm income has fallen by 10 per cent, while all other incomes have risen and we still expect the primary producer to pull the chestnuts out of the fire in connexion with our overseas balances. That is not a position that any of us could look upon as being satisfactory.

Passing from the little budget to the budget measures, I am confident that every honorable member wants to see full-blooded development and full-blooded immigration. Let nobody accuse me of not wanting immigration. I coined the phrase that the honorable member for Melbourne (Mr. Calwell) often used - “ Twenty millions in twenty years “. Actually it was coined in Formosa, An a prisoner of war camp and really was a bit optimistic and a little out of line with other things. We all want both those things, but the rate at which we can develop and the rate at which we can absorb immigrants depends upon how hard we are prepared to work and how much we are prepared to save. It is of no use referring to the fact that we could absorb 150,000 immigrants in 1947. Conditions are now entirely different. Working hours have been reduced, the standard of living has increased and there are all sorts of different conditions operating. If we support the Government’s proposed decreased but still high intake of immigrants, we must follow that policy through to its logical conclusion and give the States sufficient money to build schools, provide water supplies, electricity, transport, homes, hospitals and all the other amenities that immigrants will need when they arrive here. Again, if we are prepared to advocate that policy we must carry it through to its logical conclusion and consider the effect it will have on the supply of building materials and labour. I leave that to honorable members to work out for themselves. If we Relieve the blandishments of the Immigration Department, as contained in the roneoed circular it sent out, we would say that the money which has been given to the State governments has been sufficient to meet all these needs.

I remind the Minister for Immigration (Mr. Harold Holt) that it is not so long ago since I was in a State government. Unfortunately, I do not think that applies to any other honorable . Minister except perhaps the Prime Minister, who was a member of a State government 22 years ago. Having been a member of a State government, I know that many things besides the factors mentioned in that document have to be taken into consideration. For instance, we have the back-log from the war which includes the depreciation to the railways in both rolling-stock and permanent ways. That has not been overtaken. Again, we must consider the effect of this Government’s health programme on public and private hospitals. All sorts of things have to be considered. I know that the Minister for Immigration felt that it was the proper thing to issue that circular, but I suggest to him that it shows only part of the picture, and we must look at the whole. The Victorian Government says it is going bankrupt, and I do not wonder at that. All these things have to be considered when we are dealing with immigration, and I remind honorable members that an increase of our population through immigration is entirely different from an increase due to natural causes. It is admitted that immigration is inflationary of itself. This has been shown already by the honorable member for Wannon (Mr. Malcolm Fraser) and the honorable member for Bradfield (Mr. Turner), and I do not propose to repeat their statements. My opinion is that somewhere about 80,000, certainly not more than 90,000, is as high a gross intake as we can absorb under existing conditions without causing greater inflationary pressures than we can manage. The same applies to national development.

I was in the Cabinet in Victoria not so long ago, and for some of the time I was Deputy Premier, when some of the big development works in Victoria were started. I want to see as high a ‘rate of national development as possible, but there again it depends on the amount of work people are prepared to do and the amount of money they are prepared to save. It has been proved to us that under existing conditions governments are inclined to go too fast, but I hope the Federal Government will give a much bigger lead than it has in the past, and realize that the Snowy Mountains scheme, exciting and excellent as it is, is not sacrosant and that, so far as the St. Mary’s filling factory is concerned as a building project and in its target date, there are far more mysteries than the Minister for Defence Production (Sir Eric Harrison) has been prepared as yet to disclose.

It has been said over and over again that what we need is a system of priorities. I still feel that, approached in the right spirit and in the right way, we could get a system of priorities in public works in conjunction with the States that would help considerably. I will take Victoria, a State that I know better than any one else. Why was there such a rapid expansion in the brown coal-fields of Victoria? That was because the miners of New South Wales and the Joint Coal Board refused to guarantee the supply to Victoria of 2,000,000 tons of black coal a year for twenty years. As a result we had to start more rapid development of the brown coal-fields than was necessary. Take the Eildon Weir. It was finished in record time and, like St. Mary’s filling factory, it cannot be used to its economic capacity because the ancillary works have not been finished. Take the Kiewa hydroelectric scheme, lt was held back because the Snowy Mountains scheme was started before it was finished. One could go on through the uneconomic and half-finished works littered all round the countryside. lt is something that both the Federal and State governments could correct if they would set their minds to it.

Take the question of general expenditure. The Public Service could do a lot. There again, it is difficult if they do not get the right lead right from the top. When we look at the budget we find that the number of departments has increased and is increasing. The honorable member for Bradfield was courageous enough and honest enough to say that he thought we had too many Ministers. If we all had the same courage and the same honesty, I think we would agree with his statement. Ministers do not have only staffs; they have departments and departments are staffed with human beings who naturally start empire-building. What I am about to say has nothing to do with any of the personalities involved. I believe all the Ministers are my friends and 1 hope they will all remain so. I know that, even as every private has a field-marshal’s baton in his knapsack, so every member of Parliament has a ministerial commission, shall we say, in his mind. Good luck to him If we look at this problem and be honest, we can cut down at least two ministerial posts in defence. Defence Production and Supply could be amalgamated, and so could the Army and Navy. [ am sure my friend on the front bench, the Minister for Customs and Excise (Mr. Osborne) would agree with me that, now that trade and import controls have been taken from the department, there is not a full-time job in customs and excise. I am sure that the Minister for Primary Industry (Mr. McMahon), if he is listening on his radio by any chance, would also agree that his portfolio is not a full-time job, that most of his job is to deal with subsidies and that his other activities overlap on State agricultural departments. This, again, is another factor. The take-over business was started as between Federal and State spheres by the federal authority, lt did not start in the business world. If there was an investigation into the overlapping of Federal and State departments, much unnecessary expenditure could be saved and 1 think the results would create some surprises. Finally, much as 1 like the Minister, 1. suggest that there is no rhyme or reason for the Ministry of National Development. It had so little to do that the War Service Homes Division was recently transferred to it to keep it from putting its fingers in other people’s pies.

If we are to continue in this way and not give the lead to the States, it is wrong for honorable members to come here and put all the blame on the shoulders of the States. I grant that the States are hitchhikers on the federal band-wagon. I know that; I have been one of them. But the blame is not all on the States. The federal authority is subsidizing civil aviation and its own railways by giving them capital works out of revenue, but then it asks the States to make their railways pay and at the same time meet the interest and sinking fund payments on loan moneys. No wonder the States feel aggrieved, when this instance can be multiplied.

All I am asking the Federal Government is to give a lead by trying again to call a free, frank and friendly conference which will put forward a new idea on’ State and Federal relations and financial agreements. I know it is difficult. 1 have sat at the conference table and been told the same thing, but the public is tired of the indecision and makeshift policies. What was good for 1943 does not apply to 1956; I refer to the formula for the distribution of moneys. First of all, the tax disbursements are divided up on the basis of the formula. Then the Government adds another £15,000,000 or £16,000,000, sometimes on the basis of the formula and sometimes on some basis of its own. Then, three of the States go to the Commonwealth Grants Commission and get another £18,000,000 - more amongst the three of them than the Federal Government is prepared to give to six States. No wonder those who are not under the Commonwealth Grants Commission are going bankrupt. Therefore, I ask the Government to see if it is possible to get a more satisfactory solution to the problem, whether or not it comes to a question of vacating some portion of the taxation field. 1 do not want to go into details; 1 have not the time, but something has to be done. Action has been too long delayed and that is the reason for some of our inflammatory and inflationary discontents of to-day. We have almost an economic civil war on our hands - and every honorable member is responsible - because of our own dilatoriness, impotence, lack of imagination and the mental sterility of the Labour party.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– What is the honorable member’s solution?

Mr KENT HUGHES:

– I have been giving a few of them; if the honorable member cannot understand them, it may be my fault. Wage-earners to-day want security and stability as much as anybody else. At present, they are just as bewildered as other people, and when a man is bewildered, he is inclined to say, “ Let us hop in for our cut “. That is what is happening. That is why 1 feel that the Government should take far stronger action in various directions than has been proposed in this budget. If I may put it another way, we have to cease cutting the lawn in order to try to cure disease at the grass roots. In agricultural language what is needed is for the economic field to be ploughed up and sown down with a clearing crop.

I wanted to talk about transport, but I have not the time. This again is another big factor in the economic instability in the country. The confusion, before the Hughes and Vale case, has become worse and now there is chaos which will not be cured by annual conferences dealing with the standardization of tail lights. The Government blew out its transportation brains very early, but I hope the present Minister for Transport (Senator Paltridge), in his enthusiasm, will be able to grapple with this problem in conjunction with State Transport Ministers and achieve something on the lines of co-ordination of transport. Something must be done to stop the rot. Railway deficits are increasing and the bottom is being knocked out of our roads. There is not enough money in Australia to build roads to carry the heavy traffic that is now trying to use them.

The other matter I want to talk about is defence. The recent evidence given before the Public Accounts Committee leaves me cold. 1 congratulate the Public Accounts Committee on having found further evidence that certain public service procedures should be overhauled. The czars of defence - and there have been czars for a long time - should have a look in the mirror before they make some of the statements that they do. I think the Defence Department, rather like the Tariff Board, went completely beyond its prerogative in making the statement it did. but all* the same if we had decreased expenditure and eliminated the pay-roll tax. the cost of living would have been reduced. My sympathy in this instance is with the Minister, but the question of administration is peanuts compared with the general major policy. For long I have been convinced that the honorable member for Indi (Mr. Bostock) and those supporting him have been right. He said that the defence system “ wastes a lot of money because it is out of date. I agree with him. For the last three years or more, our lines of communication have been all east, not west, in the case of emergency. Therefore, it is obvious that we should reorganize our defence system on the basis of defence against coastal sporadic raids and in our external defence our responsibilities must be integrated with American Pacific defence strategy as regards arms, equipment and means of communication. In other words, our defence should be based on Anzus and Seato rather than on Anzam. At present it is based on emotionalism and love of the mother country - and please do not call my love of the mother country into account; surely we need not have an oedipus complex in order to prove it. At present, our defence system is based on emotionalism rather than realism. Our national service training scheme needs re-organizing. It makes good citizens, but it does not make good soldiers in this day and age. Indeed, it is not even a Maginot Line complex; it is the complex of 1914. I ask the Government to look at these things. The Minister for Defence (Sir Philip McBride) stated recently thai certain things must be altered. I hope that they will be altered quickly. I do not blame the chiefs of staff for the present situation; one should not blame them for the defence programme, because how can they plan for an objective if they are not told the role the services are expected to fulfil. Since I have been overseas, I am more (irmly of those opinions than ever before.

To summarize my remarks, I contend that the budget maintains and aggravates most of the pressures causing inflation; secondly, it approves policies which the Government is not prepared to carry through to a logical conclusion - for example, policies in relation to immigration and development; thirdly, it maintains increased taxation for public works expenditure without ‘any system of priorities. If this policy is to bc continued, both the Commonwealth and the States should share equally in capital works paid for out of revenue. The present system is grossly unfair to the States. Fourthly, the budget maintains an unrealistic defence programme which wastes a certain amount of money; fifthly, it says nothing, and does nothing, about the existing transport chaos; sixthly, it does not honour the promises that were made in the little budget; seventhly, it perpetuates the increase in the number of departments which are in no way justified and which, with consequential increased overlapping of Federal and State functions, cause much unnecessary expenditure; and eighthly, it ignores the realities of State and Commonwealth financial problems. In conclusion. I think it was Lord Vansittart who once said -

You cannot be for ever blowing bubbles when the livelihood of millions depends on your actions and decisions.

I am afraid that this is what the Parliament is doing. The bubbles in the south seas are becoming too much like the South Sea Bubbles of historical fame for my liking. Many thoughtful speeches have been delivered by Government members, speeches in which they made many recommendations on various items. I hope that these proposals will be given the serious consideration that they deserve and not regarded by Ministers as just so many pages of “’ Hansard “ which need not be read. ‘ hope that the Government will review its financial measures, and amend them in accordance with the national needs of my country and my people.

Mr BARNARD:
Bass

.- I listened with a great deal of attention to the remarks of the honorable member for Chisholm (Mr. Kent Hughes), which he said were constructive. I have no doubt that the honorable member did set out, by one means or another, to criticize the policy of the present Government. He believed that certain things should be said, and he did not hesitate to say them. It is a great pity that the honorable member did not express the same opinions when he was a member of the Cabinet in the last Parliament. I shall leave it at that, and confine my remarks to some of the important matters that were raised by the honorable member.

In my opinion, this is a very important debate, and one which, I have no doubt, is engaging the attention of a large section of the Australian population. However, it has followed a somewhat curious course. The Leader of the Opposition (Dr. Evatt), in his amendment offered a powerful and moving indictment of the Government. It was virtually a censure motion by the Opposition. He based his amendment on a series of issues, which were more than just matters of domestic administration. They affect every man, woman and child in this country. They are issues which, to-day, are the concern of all people who are either directly or indirectly associated with the industrial and commercial life of this country. Indeed, they are the issues that are causing apprehension among those sections of the community which look for, and are entitled to expect, a lead from the government in office, but which are not receiving it from this Government. This is not the first occasion, of course, in which the Leader of the Opposition has pointed to the weaknesses of the present administration and has, on behalf of the Opposition, predicted the serious consequences that can be expected to flow from an administration - a government - which has no policy and no plan and which, in fact, focuses its attention in one direction to-day and another to-morrow, and always unsuccessfully. On other occasions, I am bound to admit, there has always been at least one worthwhile reply from a responsible Minister to assertions by the Opposition, possibly a reply in which the main issues have been skilfully avoided, but which was nonetheless effective because of that. Therefore, I say that this debate has followed a very curious course, inasmuch as there has not been one really worthwhile reply to the devastating attack that was made on the budget by the Leader of the Oppomon. Certainly, there have been apologies, but I believe that this Parliament and the people of Australia should be accorded something more than apologies during a period of extreme economic crisis.

I want to say, too, that the Government has been in charge of the affairs of this country since 1949. During that period, it has asked for, and has received from the people, a magnificent response. Time and time again, the ordinary citizens have accepted a lowering of their standards because they believed they were making a worthwhile contribution to the economic recovery of this country during a difficult period. The workers accepted without qualification a freezing of the basic wage, without control being correspondingly exercised over costs and prices, because they were prepared to give that policy a fair trial. That the experiment failed - and failed miserably - is certainly due to no fault of the wage and salary earners. It failed because this Government did not have the courage to ensure that all sections of the community played their part. I say at once that, during the whole of its term of office, the Government has been both lazy and indifferent to its duty. Surely any government, any Treasurer - indeed, any one of the 22 responsible Ministers who were carefully selected by the Prime Minister (Mr. Menzies) - might have been expected to take action to ensure that a policy which called for such sacrifices by one section of the community, and which could have meant so much to the well-being of this country, would at least be given a fair trial by other sections. I refer particularly to those sections of the people who were in a position to engage in exploitation during the period in which there was to be an accepted maximum standard for the wage and salary earners, but no corresponding control over the factors on which’ standards necessarily depend.

It may perhaps be said that the task of safeguarding Australia from inflation and depression, and controlling profiteers, is not the sole responsibility of this or any other government. It may be contended that those are nation-wide problems which can only be solved by complete co-opera tion on a nation-wide scale. I suggest, however, that it is the responsibility of the central government to give a lead in maintaining economic stability which, in effect, means the prevention of booms and slumps, which, in the past, inevitably have led to a decline in our living standards and to unemployment and misery. It is also the responsibility of this Government to stabilize the purchasing power of money, as well as to protect and improve the living standards of the various sections of the community - matters which are of extreme importance to pensioners and others on fixed incomes. One does noi need to be a trained economist to appreciate that control of prices is the governing factor in all those things.

As the result of our war-time experience of prices control, there were good grounds for confidence that it would be of real value to the Australian people. That experience demonstrated that it was possible to administer prices control effectively. The Treasurer (Sir Arthur Fadden) knows that thai is so, but rather than admit that the only effective method to control the present unsatisfactory economic situation is to reintroduce prices control, he and his colleagues are prepared to stand idly by and preside over a further deterioration of our already alarming economic position. Surely the Treasurer and those who support him can remember our war-time experience of prices control; but to refresh their memories, let me refer to some figures. During World War I., retail prices rose by 30 per cent., but within two years of the end of the war, following the relaxation of the effective control, they had risen to 70 per cent, above the pre-war level. During World War II.. prices rose by 23 per cent., and during thitwoyear period immediately following cessation of hostilities, when effective control of prices still operated, they rose to 30 per cent., which means, that, during the first two post-war years, ‘retail prices rose by only 7 per cent. It must be remembered, too, that whilst World War I. lasted foi only four years, World War II. lasted for six years. I hesitate to hazard a guess at the increase that has taken place during recent years, having regard to the fact thai control over costs and prices has been completely abolished.

I acknowledge that the powers of the various States to control prices are limited, but it is completely illogical to suggest that the States could hope to control the cost of commodities which may move freely between States. They could do no more than control the cost of a few commodities that are produced and sold locally. If the Treasurer, or any other member of the Government, is in doubt about the speed with which prices and costs are increasing, or about the hardship which that trend is imposing on pensioners and persons on fixed incomes, it is only necessary for him to look at the position in any Australian city. Responsible people from all walks of life, including the clergy, whose self-appointed duty it is to assist the less fortunate sections of the community, will substantiate what I have said. These people know only too well that in this respect, as in many others, the Government has failed to ensure that nationwide protection would be accorded the wage and salary earner, the housewife, the tenant, and the pensioner, who, out of a miserable pittance, is obliged to pay for his shelter and all other requirements. What is the position today? The Treasurer, in his budget speech, frankly admitted that during recent years, this Liberal party and Australian Country party Government h.r. been powerless to halt the rapid increase of prices and costs. The right honorable gentleman said -

Once a general price and cost increase gains momentum, however, it is apt to keep going and even to gather strength, simply through the action of one increase upon another. Something like that seems to be happening now; for even though economic pressures have weakened the cost and price spiral has lately become more rapid.

I suggest that it is a gross understatement to say that “ something like that seems to be happening now “. Honorable members on this side of the chamber have been telling the Government since 1949 that the economy of the country was rapidly approaching disaster for all sections of the community. The fact that the Treasurer has taken almost seven years to acknowledge the truth of the criticism . directed at the Government by the Opposition indicates not only that the Government has no plans, but also that it has no policy.

We are now debating the sixth successivebudget to be introduced by the present Treasurer. On each of the preceding occasions the right honorable gentleman devoted a not inconsiderable portion of his speech to what he was pleased to call the problem of our rising costs and prices. I invite any honorable member opposite to point to> a portion of the recent budget speech which indicates that the Treasurer intends to deal with this problem now any more effectively than he has dealt with it in the past.

I suppose that the proper way to consider the budget is to examine its contents carefully and try to see how the budget proposals will affect the people. Such a consideration might take us back to 1949 whenthe present Government parties, then in opposition, made two clear and definite promises to the people. The first was that., if elected to power, they would restore value to the Australian £1, and the second, thai they could and would reduce taxation, both direct and indirect. Both promise* have been dishonoured, a fact of which the Government does not like to be reminded. It may be said, in fairness to the Government parties, that perhaps they did consider those to be matters which properly ought to receive their attention should they bi elected to the treasury bench; but theGovernment has had almost seven years in which to honour its promises, and has failed to do so. For that reason it isdeserving of censure. It has been guilty of one of the most blatant pieces of political trickery ever perpetrated on an unsuspecting people.

This budget does not give a lead and itwill not solve our economic problems. It offers no encouragement, for example, to the man on the land. The fear of dumping by overseas producers has become the dominant thought in the minds of Australian primary producers. The Government’s plan to meet this threat is, as usual, one of restriction. But surely it is better foi Australia to plan for a surplus rather thana shortage, because we know that there is always the possibility that seasonal conditions will quickly turn against us. I have said before, and 1 now repeat it. that we must regard our primary industries as being just as much a part of our defence programme as we do the arming and equipping of our forces. Maximum food production is an obligation that should be- accepted by every honorable member, and to this end the primary producer is entitled to special consideration - certainly much more than he is receiving at the present time. I warn the Government that more and more farms are going out of production because of its prevailing unrealistic financial policy, which is making it increasingly difficult for the primary producer to give of his best.

This budget offers no programme for closer settlement, and offers no help to the many thousands of young Australians who, because they were too young for service in World War If., are excluded from all current land settlement schemes, but, nevertheless, are desperately anxious for opportunities to settle on the land. Their future would appear to be hopeless, because of the present unreal and inflated values of land. One is tired of pointing to the inconsistencies of this Government, and every honorable member from this side who has spoken in this debate has referred to its incompetence and has illustrated how we have got into the precarious position in which we now find ourselves. We have also referred to the fantastic and desperate remedies that the Government has resorted to during its seven-year term of office. The honorable member for Chisholm (Mr. Kent Hughes) referred to those measures only a few moments ago, and I believe that the results of the Government’s policies have been clearly demonstrated to the people in recent months.

The Government, in the horror budget of 1952, budgeted for a surplus of £114.500,000 - possibly with the clear intention of taking that sum from the people to prevent them from exerting pressure upon the prices of goods in short supply. On that occasion the Treasurer said that the whole of that enormous sum would be placed away where it could do the least harm. However, we all know what happened on that occasion. Within a few short months, a bill had been introduced into the Parliament under which it was proposed to expend the whole of that surplus of £114,500,000- and a good deal more - before the end of that financial year. This year, the Treasurer is budgeting for a surplus of £108,000,000, presumably because he wants to place this large sum, too, where it can do the least harm. I advance the suggestion now - in the knowledge that with this Government history repeats itself - that long before the end of the current financial year the whole of that anticipated surplus of £108,000,000 will have been expended by one means or another.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– Probably to help the States.

Mr BARNARD:

– I remind the Minister that the Treasurer said in 1 952 in respect of the surplus of £1 14,500,000 that it would be placed where it could do the least harm, but the whole of the £108,000,000 budgeted for this financial year will have been obtained at the end of this year solely because of this Government’s policy of exorbitant direct and indirect taxation. During the campaign before the general election of December, 1955, the Leader of the Opposition (Dr. Evatt) suggested thai certain increases should be made in social service payments. Supporters of the Government said on that occasion that the money for such increases could not be found, yet within less than twelve months the Government has introduced two budgets, under the first of which it has gained additional revenue to the extent of £1 15,000,000. and under the second of which it has budgeted for a surplus of £108,000,000. It therefore appears that the Government has budgeted for about £223,000,000 as additional revenue during the last twelve months.

The Government’s attitude in regard to social service payments, particularly age and repatriation benefits, is completely indefensible. While I hesitate, at this moment, to do any more than express my complete disapproval of the Government’s attitude in failing to accord some relief to a very deserving section of our community, I have no doubt that an opportunity will present itself to me, when the appropriate measures are before the House, to enlarge on what 1 have said. It would be difficult for honorable members on the Government side to argue that a shortage of funds is responsible for their heartless attitude. They could and should have increased all social services payments, and substantially reduced indirect taxation. I could be asked in what respect I would reduce government expenditure in order to increase social services, but

I merely invite all honorable members to examine carefully the estimates for capital works for the current financial year.

Last year the Government budgeted for an expenditure of £101,800,000 for capital works and services, while this year it has budgeted for £109,700,000 for the same purpose. But what does the Government do in estimating the requirement for capital works and services? Let me quote some figures from the budget papers. Last year the Government expended £15,100,000 on the Snowy Mountains Hydro-electric Authority. This year it will expend £18,000,000 on that authority, which is an increase of approximately £3,000,000 over the expenditure of the previous year. I do not quarrel with that provision for the Snowy Mountains scheme, and I shall indicate in a few moments where my quarrel lies in that respect. During 1955-56 the expenditure of the Government on the Australian Atomic Energy Commission was £1,400,000, and for 1956-57 it will be £2,400,000, war service homes will, unfortunately, involve only the same expenditure as in 1955-56, which was £30,000,000. Department of Civil Aviation expenditure on works, sites and buildings will increase by about £100,000 to £2,800,000 during the current financial year, and in each of those cases - and there are many more, as I have dealt with only a few at random - the whole of the cost will be met out of taxation.

Each of the capital works to which I have referred is an asset which will last for generations. In some cases, particularly, the Snowy Mountains scheme, the assets will last for a century or more. Yet, in one year the taxpayer of Australia has been asked to shoulder a financial burden in excess of £100,000,000. One could not argue against the use of revenue for such purposes during war-time, and the same might be said about the immediate postwar years, but surely eleven years after the cessation of hostilities one is entitled to ask how much longer will the taxpayer be expected to shoulder a financial burden which we all know should be borne - in part at least - by succeeding generations of Australians. All the capital works to which I have just referred should be financed with money borrowed from the general public, in which case the burden would be borne over a far greater period than the twelve months over which it will now be borne. In any event, nobody could deny that if a portion of the £109,700,000 being set aside for expenditure this financial year on capital works and services were obtainable front’, loans funds, immediate concessions in-, indirect taxation would be possible. Undoubtedly, the key to this situation isrestoration of confidence in Australianloans. The Treasurer, and those who support him, know only too well that successive loan raisings in recent years have failed’ because of the Treasurer’s manipulation of interest rates and other factors. He knows, the solution. In the limited time at my disposal I can make only one suggestion, but it is an important one: I suggest that the Government give an immediate assuranceto the investors of Australia that their savings will not depreciate because of a manipulation of interest rates and other factors during the currency of their bonds.

The present method of financing capital works and services from revenue is placing an intolerable burden on the economy of this country. A solution must be found torestore confidence to the Australian loanmarket. A solution is possible, and unquestionably it is the Government’s responsibility to find it. When Labour left office in 1949, this country, a young vigorous one, was moving towards a far better economy than it had ever known before. In seven years we have seen substituted an unbalanced economy and a lethargic government. In my opinion, for those reasons* if for no others, the people of Australiawould desire that this motion be carried.

Mr FAILES:
Lawson

.- At the outset, I should like to join with other honorable members in paying a tribute tothe Treasurer (Sir Arthur Fadden) on the presentation of this budget. It is not uncommon for a Prime Minister to assume, in addition, the office of Treasurer, but it is not common for a Treasurer to be saddled with the responsibilities of an acting Prime Minister, and to have the added burdens ot world upsets which have occurred during the preparation of budgets. This has been the Treasurer’s experience during several periods of his career. I listened with interest to the speech of the honorable member for Bass (Mr. Barnard). It always interests me to hear the would-be financiers- tell us how we should finance our capital works from loan moneys and not from revenue. They are all blissfully prepared to overlook the fact that the tremendous public works which we have in this country to-day were prepared for us by earlier generations. We accept those things. We accept the great advances that have been made in Australia since its discovery, but we say that we shall not put any money into this country from our own pockets; instead, we shall borrow it and let posterity pay it back. Is that a very bright national outlook for any government or any opposition to espouse?

Mr Barnard:

– What about local government?

Mr FAILES:

– Local government is in the same position; it has inherited tremendous public works. I recollect my father saying, in 1912, “We must have shire council chambers - a decent building which will last many years “. The shire council of those days set to and built it. It is not big enough to-day, but I suggest that local governments to-day do not wish to build new council chambers from their own revenue; they propose to build them with borrowed money. It might be said that many of the public works of to-day have been built with borrowed money. I quite agree that building with borrowed money is rather a facet of Labour governments. As a matter of fact, we are saddled with the burden of meeting this year loan redemptions totalling more than £200,000,000, much of which was borrowed during the war years. We are still paying for World War I. and World War II., which were largely financed by Labour governments with borrowed money. It is entirely overlooked that when the disposals commission sold about £135,000,000 worth of surplus material at the end of World War II. that money was not used to repay loans that had been raised to purchase that equipment, but was paid into Consolidated Revenue. So it goes on. If we use not current revenue but loan money for public works, there is the added problem of what the State governments will use for their public works, which they are determined to build with loan money. As the honorable member for Bass knows, it is the very fact that the Commonwealth Government is not sharing, as it is entitled to share, in the loan money, but is doing its own public works from revenue, that enables the States to carry out their public works programmes on borrowed money. They still could not do all that they propose to do if they were not heavily subsidized from the surpluses which are produced by this Government.

The honorable member for Bass says that the devastating reply of the Leader of the Opposition (Dr. Evatt) to the budget has not been answered. It is a realistic budge; for times of prosperity, and no one has questioned that we are enjoying prosperous times. The Premier of New South Wales, when introducing his budget, made special play of the fact that we are enjoying prosperous times. The budget suits these times, but the Leader of the Opposition made what has been referred to as a powerful denunciation of the budget. With this description I disagree. He said that the budget favoured what he called powerful corporations and profiteering interests. He did not name them, but, reading his speech carefully, I failed to see where he indicated in what manner they were being favoured. His answer to our problem is prices and rent control, capital issues control, and control over hire-purchase interest. That is nothing more than a political objection to the budget. That is not what one might expect from an Opposition which would say, “ The Government in power has certain party political views on these matters We shall try to persuade them to produce n better budget.” What the Opposition is saying is, “ We do not like at all your political attitude’ towards these problems. We suggest that you adopt our line of political thought.” Of course, that shows how futile is the Opposition in this chamber, and that attitude is largely responsible for the type of debate that we have hau

It must be agreed that the budget ha* received very little criticism from outside the Parliament. It has been suggested thu: profiteering has resulted from the freezing of the basic wage. But cost of living adjustments have proceeded in New South Wales and Victoria, consequently it cannot be said that the freezing of the basic wage led to profiteering because those two major States have not frozen their basic wages.

The honorable member for Bass referred to the budget speech at the point where the Treasurer said -

Once a general price and cost increase gains momentum, however, it is apt to keep going and even to gather strength, simply through the action of one increase upon another. Something like that seems to be happening now; for even though economic pressures have weakened the cost and price spiral has lately become more rapid.

But he did not read on to where the Treasurer said -

As I have said, it is partly the delayed result of earlier pressures but it is certainly being accentuated by factors such as the automatic adjustment of wage rates under some State wagefixing systems.

And on the next page the Treasurer stated - lt is calculated that the automatic adjustments made to State basic wages since 1953 are adding £30,000,000 per year to the wage bill and this is only the direct addition to costs.

So, it can be seen that if an inflationary spiral exists in this country at the present time, there may be many reasons for it; but, unquestionably, the continuing increase of wages has made its contribution to the spiral.

In all countries, governments either lead or drive. We, as a government comprised of Liberal party and Australian Country party components, prefer to lead the people and to place before them in a budget the opportunity that is available to them to co-operate and to produce a result that will be beneficial to the nation as a whole. But the Leader of the Opposition, in his criticism of the budget, proposed that we should drive the people, and that we should control prices, rents, capital issues and hirepurchase interest rates. The right honorable gentleman likes the idea of driving people; he does not believe, as does this Government, in leading people. All I can say is that, if one looks through the budget papers, one sees that every opportunity is given to the people to follow the’ lead of this Government. If some do not follow that lead, they hurt others more than they hurt themselves.

It is admitted that we have internal and external problems. The old problem of inflation is still with us to some degree. lt has been stated to be the result of too much money chasing too few goods, and I do not think anybody can disagree with that statement. If that state of affairs exists, it is necessary to analyse the position to see how we can correct it. Certain problems associated with intiation are the result of the desire of some people to buy beyond their means. Those people see things that they desire to have and, not having the means with which to buy them, they chase around and try to borrow the money to buy them. The Opposition’s answer to that problem would be to provide the money, but the only way by which they ever suggested they could provide the money was by using the printing press. But that would only further aggravate the inflationary problem.

I invite the committee to look at the statement showing the national income and expenditure for 1955-56, which was furnished with the budget papers. Let us see what has occurred in the eight years between 1948-49 and 1955-56, because by so doing we can get a fair idea of where the country is heading. During that period. Australia’s national income more than doubled, and it is increasing progressively. During that same period, farm income rose by one-third, and I am sorry to say that it is declining. As a percentage of the national income, it has declined over those eight years from 17 per cent, to 10 per cent. On the other hand, wages have risen two and a half times and are still rising; yet we see the shedding of crocodile tears and hear the suggestion that the poor down-trodden worker is not getting a fail wage and should be having a better spin than he has enjoyed at the hands of this Government. I have not limited my comparison to the period of office of thi, Government, but have taken a period ot eight years. I emphasize that over that period, although the national income has only just more than doubled, the wages paid to the workers have risen two and a half times. Gross personal income has doubled and gross national produce has slightly more than doubled, but gross domestic expenditure has risen over two and a half times. That illustrates the point I mentioned earlier - that there is more money than goods, that people spend lavishly, possibly more than they have saved, and dip into loans in order to buy the things on which they have set their eyes.

The disturbing feature revealed by this paper is that receipts from exports have risen by only a half over that period of eight years whilst payments for imports have doubled. That constitutes one of our great problems. Our consumption expenditure rose as follows between 1948-49 and 1955-56: - Rent, from £121,000,000 to £263,000,000; food, from £381,000,000 to £892.000,000; clothing, &c, from £239,000,000 to £435,000,000; hardware and furniture, from £136,000,000 to £360,000,000; and other items of what might be called domestic consumption expenditure, from £141,000,000 to £325.000,000. The aggregate expenditure rose from £1,018,000,000 in 1948-49 to £2,285,000,000 in 1955-56- just over twice as much. But with one exception, namely, farm income, the rate of increase of income and expenditure is substantially the same. 1 direct particular attention to farm income, because it is upon farm income that we depend almost entirely to maintain our balance of payments. I do not wish to cite a lot of figures, but 1 want to read the following comment in the Treasurer’s statement on national income and expenditure -

The principal factor, however-

This is in reference to the decline of farm income - has again been the increased estimate for depreciation which is defined as for taxation purposes, and is affected by the special depreciation rate of 20 per cent, per year on new farm machinery. This special rate has now been operating for five years.

I entirely disagree with that comment. I think it is most unfair to say that farm income has dropped because of the depreciation that has been allowed to the farmer and grazier. If one looks at the comparative tables in appendix B, one will find that in 1950-51, when provision for depreciation was first made, the income from farms was £751,000.000, whereas for 1955-56 it was only £414.000,000. In other words, it dropped by £337.000,000. Allowances for depreciation in 1950-51 totalled £199.000 000. but in 1955-56 they totalled only £337,000,000.’ In other words, they rose by only £138.000,000, which was nothing like the decline in farm income.

What do we intend to do to tackle the problem of our balance of payments and the internal condition of inflation? I suggest that, first, we should have greater production for home consumption. At the present time, we are imposing import controls to try to prevent imports from coming into the country and are doing everything we possibly can to keep our overseas balances straight. It has been stated that we must increase our production, that we must export more or import less; but I suggest that insufficient attention has been directed to this most important consideration of greater production for home consumption. We cannot for ever depend on rural industries to get us out of trouble. Let us get off the sheep’s back, to use the old expression. We find that the value of exports is £778,000,000 per annum and of that total, exports of wool represent £354,000,000. If we add to that figure the value of other primary commodities we find that something like 90 per cent, of our exports come from that section of the community.

We have an assurance from the Minister for Trade (Mr. McEwen) that the manufacturing industries are doing their best to increase the export of secondary products in order to build up the fund on which we can draw to pay for our imports, but we still find that there is not enough doing in that direction. We hear people say that rural industries have to produce more so that we can sell more primary products overseas. It appears to me, as one very closely associated with them, that they are producing as hard as they can. If they were to produce more, we would still have the problem of sale. Some people say, “ We cannot sell what we produce at present, so what is the use of producing more? “. I put it to honorable members that if the businessman took that point of view and ceased to buy because he could not sell, he would go broke very quickly; and if this country is in such a position that it feels it cannot make sales and must restrict its imports it will be in the same position.

We have to go out and sell. I know there is a trade drive at the present time to build up sales overseas, but it is only chickenfeed compared with this country’s great production potential. We are told that we cannot bring it into production because we cannot sell our exports. Do not let us forget that everything that is made for consumption within Australia, and which would otherwise have been imported, is just as valuable to us as that which we make and sell overseas. So I urge that we should do everything possible to build up production, not only of primary products, but also of secondary articles which we can use and which will save us from having to import goods of a similar nature.

In order to do so, we have to look at several problems. We have to consider the immigration problem. We have to consider what immigration can contribute and what disadvantages may accrue from it. I think that the honorable member for Bradfield (Mr. Turner) was very critical of our immigration programme. Personally, I support it. I consider that immigration has been of tremendous value to this country. If one goes through the figures concerning immigration, one finds that immigrants have produced a tremendous amount which has been of value to us. Take the steel industry. Since the war the output of steel has doubled. According to Mr. Dickinson, of the Mines Department of South Australia, we can still afford to increase our steel production because we are importing steel. I hope that we shall be able to increase our steel production. I am informed that since the war the output of steel has doubled, and that 75 per cent, of the additional work force in the steel industry has been made up of immigrants. They have played a tremendously useful part in producing the things that we require and which, otherwise, would have had to be purchased outside Australia.

The price of Australian steel is about £44 a tori as against £80 a ton for imported steel. I think that the production over the last five years has been over 900,000 tons a year, and because we have been able to produce that additional quantity in Australia, we are tremendously in pocket, in view of the fact that we are producing at a price of £44 a ton as against £80 a ton for imported steel. It has been estimated that it has saved our overseas funds £72,000,000. So, here is one way in which we can produce something in Australia for our own use in order to prevent our importing a similar article.

I could quote at great length from many other documents. I recently quoted from a publication concerning Lysaghts Works Proprietary Limited, a company which produces sheet steel. Immigrants comprise 27 per cent, of the total work force in that company and 19 per cent, of them are skilled. The annual output of that company is worth £17,000,000. Again we see what a tremendous influence the immigrant population has had on the post-war expansion - because it has been post-war expansion in most cases - of those industries which have seen fit to use immigrants. Immigrants comprise 65 per cent, of the work force of General Motors-Holden’s Limited, and the annual output of that organization is worth £78,000,000. So, let us not, in looking at the cost of immigration to this country, overlook the tremendous value that immigrants have been and can be for us.

I shall now quote to the committee the articles that we are importing at the present time. These figures come from a Treasury information bulletin which was issued in April of this year. For the nine months period from July, 1955, to March, 1956, I find that we imported foodstuffs other than tea to the value of £16,000,000; piece-goods to the value of £46,000,000; other textiles to the value of £11,000,000; metals and metal manufactures of iron and steel, not including tinplate, to the value of £23,000,000; motor vehicles to the value of £58,000,000; other metals and metal manufactures to the value of £44,000,000; electrical machinery and equipment to the value of £26,000.000; and other machines and machinery, excluding tractors and parts, to the value of £68,000,000. These items are not very well dissected here, but the figures speak for themselves.

We imported £12,000,000 worth of timber, although New Guinea could produce practically any timber that we require in this country. We imported pulp, paper and board, other than printing paper, to the value of £12,000,000. That is an industry in which a considerable number of immigrants are occupied, and they have assisted largely in cutting down our imports of that commodity from £17,000,000 in the previous year. Then there are incidental items, which are not described, to the extent of £96,000,000. These imports all add up to a tremendous figure. In the financial year 1954-55. £847,000,000 was paid for imports and in the last financial year about the same amount was paid. 1 suggest that we should do everything possible to exploit those industries in our own country which are capable of producing at least some of those things which we are importing. If we can make them in Australia, there is no reason why we should import them. Every pound’s worth of goods that we can produce in Australia saves a pounds’ worth of imports and is so much towards conserving our . overseas trade balances.

I began by saying that the Government makes it possible for people to do certain things. A government can lead, or a government can drive. I belong to a government .vh:;h, I am thankful to say, does not believe in driving the people. It tries to give people the opportunity to expand their activities. We have had tremendous expansion in the last eight years. We can continue to expand. I am sorry that I do not agree with the honorable member for Chisholm (Mr. Kent Hughes) who thinks that we may be outstretching ourselves in our expansion. 1 believe in this country, and 1 am optimistic enough to think that it has tremendous avenues for expansion still. I think that we can expand, not only by increasing our work force by immigration, but also by increasing the productivity of the country. I read a very good comment by the Ministry of Labour Advisory Council on productivity, as follows: -

Higher productivity is the outcome of improved efficiency in many and varied new undertakings and involves the application of many different methods.

In other words, it is not limited to the worker or the boss but has a great number of individual applications. Their application depends on incentives to increase efficiency, a consciousness of the need to raise productivity and a willingness by all concerned to attempt all the means available. If that objective, as laid down by the advisory council which consists of persons who support both sides of this House, can be achieved, I have no doubt whatever that the productivity of this country would be improved. Then we would very soon get out of trouble both with regard to our internal and external economy and our balance of payments.

Mr L R JOHNSON:
HUGHES, NEW SOUTH WALES · ALP

– The honorable member for Lawson (Mr. Failes) has been in this Parliament for many years, and it is astonishing that he should have been here so long and have spent to much time talking ineffectually of our national problems. The honorable member’s discussion of our internal problems sounded like an organ recital, but the situation is not likely to be improved by the absence for so long from this country of Australia’s leading medico. The unfortunate fact is that the Suez-side chats Australia is receiving from its leading medico are not going to assist it to achieve economic health. Apparently, the Government believes that Australia’s problems are so unimportant that they can be treated by some form of government by proxy or by remote control. During this period of proxy control - and, indeed, throughout the time that this Government has occupied the treasury bench - we have been slipping progressively further backward. It is unfortunate that the honorable member for Lawson should have talked for so long, after being in this Parliament for so long, and have failed to make any real contribution towards the solution of Australia’s problems.

The honorable member for Lawson took the honorable member for Bass (Mr. Barnard) to task. He seemed to think that the honorable member for Bass had taken the wrong view of the financial assistance that has been meted out to the States. Apparently, the honorable member for Lawson believes that the States should revel in the fact that, in this year of grace, they are receiving virtually the dregs of Commonwealth revenue to the extent that Australia’s flagging loan market requires. Apparently, the honorable member believes that the States are unjustified in their unhappiness about this state of affairs.

The Opposition believes that the Commonwealth Government is unjustified in its view that it should finance most of its own capital works out of revenue, and then make available to the States uncertain amounts of loan money. The Opposition is particularly critical of the Commonwealth’s actions in that connexion because this Government has done so much to destroy the confidence of the Australian people in the loan market. The significant fact is that, unless confidence is restored, Australia will be in considerable difficulty for a long time. lt is apparent that many of the great national projects that should be under consideration, or in course of construction by Commonwealth and State Governments, can be financed only through the enthusiasm, confidence and faith of the Australian people. Until we can restore to the treasury bench a government which has the ability to inspire that confidence, Australia will always be in difficulty.

The honorable member for Lawson referred to immigration, and said that immigrants had made a valuable contribution to production in many Australian industries. That is true, and great credit is due to the immigrants who have helped to increase materially production in the sugar, steel and other industries. However, it is just as important to be realistic in considering immigration to-day, especially as this Government appears to be incapable of regulating the supply of amenities and services which are indispensable to the welfare of immigrants when they arrive in Australia. To import people into Australia when we have considerable difficulty in housing Australians is tantamount to importing slum conditions. To import immigrants when this Government is incapable of guaranteeing employment for all Australians is tantamount to importing unemployment. It is difficult to say whether this set of circumstances is the result of design or accident, but I repeat that the Government’s failure to regulate and control the relevant conditions has had the effect of importing slum conditions and unemployment.

The honorable member for Lawson has failed to gain any great credit from his speech. Similarly, the Treasurer (Sir Arthur Fadden) has failed to win credit for himself by the budget speech that he delivered on 30th August. His speech was so dismal and discouraging that it caused me to abandon the smoking habit which I have practised for about fifteen years. The shocking principles perpetuated in the budget, in the way of indirect taxation and the flagrant denial of the capacity to pay principle of taxation, were of such a character that I simply could not continue to be a party to them by smoking.

The Treasurer referred to costs and prices in his budget speech, and I remind honorable members that this was the Treasurer’s ninth budget - his ninth national misdemeanour. In his budget speech the Treasurer said -

We have no full and exact measure of cost and price changes over the whole field of the economy, but it is common ground that costs and prices have been tending to rise for the past couple ot years and that latterly the rate of increase has become more rapid. The movement has reached a stage at which it is beginning to affect seriously the relative economic position of people and classes of people and to disturb the competitive position of firms and industries. It is also at the spiralling stage in which a cost or price increase affecting one commodity sets in train a series of cumulative cost and price increases, multiplying the original increase.

That is a most startling revelation. The people of Australia must have been astounded to hear the great heights to which the Treasurer can rise when he announces his budget, and reveals so vividly that we are in a period of crisis and suffering the effects of inflation. When the people of Australia listened to the budget speech of the Treasurer on 30th August, they hoped to hear that the right honorable gentleman, and the Government, had some plans to overcome inflation. Does anybody in this chamber know of any plan that the Government intends to put into practice in the next twelve months to combat inflation? The Treasurer has clearly announced his policy to stabilize the Australian economy, and he has shown, just as clearly, that he is unable to find an answer to the great national dilemma.

The Treasurer’s budget speech amounted to a denunciation by the Liberal-Australian Country party coalition of the humanitarian principles involved in the social services available to Australians. While several temporary increases were effected to camouflage the very uninspiring, unimaginative and unjust economic proposals of the Government, the great majority of the people were denied a share in Australia’s prosperity which has been retained as the exclusive domain of big-time overseas and local investors.

Every undesirable feature of previous budgets has been perpetuated to create what I think can best be described as an economic monstrosity. Opposition and Government members alike have been at a loss to understand or describe it. The Government’s irresponsible lack of concern for the need to correct glaring injustices suffered by wide sections of the Australian community is beyond description. The 1956-57 budget proposals follow the same destructive pattern, and show signs of the same kind of economic decay and deterioration of the standard of social services, which characterized a number of preceding budgets. We well remember the horror budget of 1955, and then the little horror of 1956. We now have the horror of horrors. I was not surprised recently to hear this place referred to as the chamber of horrors. Although 1 feel that description was disrespectful, I am bound to say that it sums up the position very effectively. One distinguished, but completely disillusioned, Australian Country party member endeavoured to explain-

Mr Whitlam:

– There are no distinguished Australian Country party members.

Mr L R JOHNSON:
HUGHES, NEW SOUTH WALES · ALP

– That may be so. The honorable member to whom I refer said the budget was a hold-the-line budget. That statement certainly distinguishes him, because nothing could be farther from the truth than the inference that this budget will hold for the majority of the Australian people the standards they have enjoyed hitherto. That is completely contrary to the facts, because wholesale deterioration of the living standards of people on fixed incomes and those working under federal awards has taken place, and is currently taking place. I doubt whether one can discriminate between people on fixed incomes and those working under federal awards these days, because the latter are indeed on fixed incomes. In addition, the rate of national expansion and development has been seriously curtailed. Even more unfortunate is the appreciable collapse in the values of the various social services. Possibly the Government is concentrating all its undesirable and unpopular legislation in the early part of the term of the Twentysecond Parliament in the hope that, in some budget immediately prior to an election, it will be able to masquerade as the pensioners’ friend, as the watchdog of the people’s rights, and as the bulwark against communism and the like, and perhaps appease the electors by offering them minor concessions of short duration and dubious value as it has done prior to so many previous elections. Obviously, many years will elapse before any government can fully restore the value of social services benefits which has largely been lost since the last Labour budget was introduced in 1948.

Mr Cope:

– It will take us years to clean up the mess.

Mr L R JOHNSON:
HUGHES, NEW SOUTH WALES · ALP

– Yes, and the sooner we set about the job the better it will be for the Australian people. My statement about the lost value of social services benefits is not a flight into fantasy, but a carefully calculated statement based on the official figures published by the Commonwealth Statistician. My colleagues have already shown that, statistically, pensions - particularly age and invalid pensions - child endowment, the maternity allowance, and unemployment and sickness benefits all have seriously diminished in value in the period during which Labour has been out of office, lt has been shown that, based on the basic wage of £5 16s. a week in 1948, by the same method of assessment, the basic wage in 1956 should be £13 a week. If the federal basic wage were restored to its proper 1956 level it would have increased by 124.14 per cent, over the rate prevailing in 1948. If the cost of living figures on which the basic wage is assessed have increased by 124.14 per cent, while this Government has been in office, as my colleagues have shown, why have social services failed to rise commensurately? lt is true enough that, while Labour members have been kept busy interviewing pensioners and making representations about their problems, Liberal party and Australian Country party members have been grappling with the problems of importers and profiteers. But, for all that, the human difficulties experienced by all who receive pensions should be sympathetically understood by every honorable member who describes himself as a representative of the people.

Government members apparently are unaware of the difficult housing problems of pensioners. If they are not unaware of those problems, one is at a loss to understand why this budget makes no provision for the housing of pensioners. As I interview pensioners and see them queueing up to interview me at various centres in the Hughes electorate, it is apparent to me at least that they have a great problem which this Government could assist to solve. It has made some paltry attempt to solve it by subsidizing, in some degree, the efforts of voluntary organizations which, though their intentions are good, cannot deal with the problem really effectively. It is abundantly clear that this Government is under a heavy obligation to make genuine efforts to house the aged. In future housing agreements between the Commonwealth and the States, provision will have to be specifically made to ensure that pensioners, who, after all, have made Australia the country it is to-day, will be adequately cared for in their time of need. We have erred greatly by overlooking this obvious requirement.

This budget stands condemned for manyreasons. Foremost among them is its failure to maintain the value of pensions in the face of spiralling costs. The Government, by its failure to maintain the relationship of the various social services to the level of the basic wage in 1948, is perpetrating an economic hoax of unprecedented proportions. Age and invalid pensioners, for example, are losing 15s. every week. Women receiving the A-class widow’s pension are losing £1 ls. 6d. a week, and 8-class widows are losing 15s. 5d. a week. Although child endowment of 5s. a week for the first child has been introduced since 1948, families with two children are losing 7s. 5d. each week. Those with three children are losing 19s. lOd. a week, those with four children £1 12s. 3d. a week, and those with five children £2 4s. 8d. a week. The maternity allowance remains at the same level as in 1948. Would any government member seriously suggest that £15 will buy nearly as much in 1956 as it bought in 1948? Why has the Treasurer failed to increase the maternity allowance in this budget?

Mr Duthie:

– There was no election pending.

Mr L R JOHNSON:
HUGHES, NEW SOUTH WALES · ALP

– No election was at hand. Perhaps the next election will provide some attractive morsel for the unfortunate women who have to deprive their families of so much in these very difficult times. We have shown that, in order to maintain the value of the first-grade maternity allowance to accord with the new basic wage level an increase of £18 12s. 5d. would be necessary, bringing the allowance to £33 12s. 5d. The same proportion ot deficiency prevails in respect of the secondgrade and third-grade maternity allowances, the details of which I shall not go into at this juncture. The position is all the less explainable when we appreciate the fact that total revenue from taxation for the year 1948-49 was in the vicinity of £449,000,000, whilst the budget currently under review provides for a total revenue of £1,230,000,000. This year, £99,500,000 more revenue will be raised than was raised last year. Such is the rapid rate of inflation incurred under a government which has failed pathetically to honour its pledge to restore value to the £1! Instead, the value of social services benefits has been deflated, and untold suffering and hardship has resulted.

Typical of the great wave of protest which has swept the country since the budget was introduced was the statement made by the federal president of the Australian Council of Retailers, who is not usually inclined to make statements that would have the effect of discrediting the present Government. He was most outspoken. He said -

Last year’s budget was a dull, soulless affair. The little budget of March was a little horror, and this budget can surely be called the hean break budget.

The Treasurer has announced a record collection of taxes, a record per capita income tax and record spending which is not in Une with his exhortations to the public to economize.

Hundreds of thousands of employees working under federal awards have been deprived of the benefit of cost of living adjustments as have the recipients of social service benefits who will suffer as a consequence of this heartbreak budget. All the bad features of the little budget of last March have been retained, including the extortionate and inequitable sales tax, customs and excise impositions which from our point of view represent a most undesirable and retrograde step.

Sitting suspended from 5.57 to 8 p.m.

Mr L R JOHNSON:
HUGHES, NEW SOUTH WALES · ALP

– Prior to the suspension of the sitting I was in the process of condemning this Government for its failure to honour its promise to restore value to the £1. I condemn it also for its complete indifference to the plight of the Australian pensioners and for its failure to hold the value of the various social services benefits in the face of rising costs and in the face of the general inflationary situation. It is a matter of great regret that this budget fails to deal with any of those problems and, indeed, fails to deal with any of the vast multitude of problems which beset the Australian people. 1 should like to deal with many matters directly associated with the budget, but I shall have time to raise only a matter which I consider to be of tremendous national importance. I refer to federal aid for education. This matter is above party politics because the future welfare of Australian children and of Australia itself is involved in the adequacy or otherwise of State educational facilities. It is certainly important for us to appreciate that our existing education facilities leave much to be desired. It is necessary that we determine the extent of our deficiency and set out systematically to raise the general education level in the light of modern requirements. The world at large is advancing towards an entirely new era, to the age of electronics, atomic energy and the accompanying substitution of automation for human beings on the production and assembly lines, ~s well as in methods of computing, recording and accounting. Clearly, a nation with a future places emphasis on education so that the new techniques might be comprehended and exploited to the greatest possible degree.

Similarly, the new importance of educating people to live contentedly in circumstances in which the’ average working week is closer to twenty rather than 40 hours should be taken into account. The prospect of increased leisure underlines the increasing need to teach the art of living as well as the art of making a living. That is a matter this Government seems to disregard in its payments to the States for educational purposes. It is important that this country should fully avail itself of the new techniques and advantages of the age of electronics and automation. We should bc planning to develop the technical and intellectual capacity of our youth to the greatest possible extent.

It is a regrettable fact that financial considerations are unjustifiably preventing the making of provision for hundreds of schools desperately needed throughout Australia. It is a matter for great alarm that in New South Wales, for example, the Minister for Education has announced that of 172 new school buildings urgently needed, only 23 can be commenced in the current financial year. Similarly, efforts to train more tradesmen, technicians and technologists to meet the rapidly expanding needs of both primary and secondary industries are being drastically curtailed to the point at which only half of the amount actually required for the provision of new buildings for technical training purposes is available. A similar position prevails in other States. Many classrooms are overcrowded and overflowing into church halls and passageways. Teachers are practising their noble calling under difficult and appalling conditions whilst increasing numbers of young Australians are being deprived of fair and reasonable educational opportunities. The enormous responsibility involved in providing adequate and free educational facilities to all Australians at all stages is one which is important enough to be fully guaranteed in these days of uniform taxation by the National Government.

We can no longer invoke the Constitution as an insurmountable obstacle to the Commonwealth’s granting sufficient funds for this purpose. The leaders of the two main political parties in this Parliament have already conceded that no constitutional barrier exists that prevents the Commonwealth from coming to the rescue by making grants to the States for educational purposes. This procedure operates in respect of conditioned grants for flood relief, adult education, universities, housing and a number of other purposes. I urge all honorable members to encourage both the Commonwealth and the States to approach this challenging task in an atmosphere of co-operation and urgency in order to ensure that no effort will be spared to meet the educational needs of the nation.

I commend to the Government and the Parliament consideration of the proposal that the Commonwealth invite the State governments to join with it in setting up a commission to inquire into the educational needs of the various States and to recommend specific action to be taken during the next five-year period in this sphere. I am satisfied that if such a procedure were instituted, in accordance with the declared attitude of both political parties, it would meet with the popular acclaim of the Australian people who are greatly distressed that educational standards are declining and deteriorating in this country as the result of the relationship between the States and the Commonwealth.

Mr CRAMER:
Minister for the Army · Bennelong · LP

– It is very interesting that our young friend, the honorable member for Hughes (Mr. L. R. Johnson), should raise the subject of education in the closing moments of his speech because it gives me the opportunity, without repeating the laudable objectives he has in mind, to remind the Parliament and the people of Australia that this is the only Commonwealth Government in history that has actually taken a direct interest in and given assistance to education. We know that the States have been given more money for that purpose by this Government than by any of its predecessors. That fact cannot be denied. This Government introduced new legislation, never before attempted in the history of this country, wherein last year it allowed the amount of £75 and, because of its recognition of this increasing problem, this year allowed the sum of £100 as a deduction for income tax purposes in respect of the amount spent by families on education.

I have listened in this debate to the mournful expressions that have come from various honorable members opposite, and I think it is about time, since we are nearing the conclusion of the debate, that we ceased all this crying about the things that might happen in the future and, instead, had a look at, and be thankful for, the things we have enjoyed during the last few years. It is an undeniable fact, as the citizens of Australia know, that since this Government came into office in December, 1949, this country has enjoyed the greatest degree of prosperity in its history. We have had continuous full employment, and conditions of labour and the amenities of life enjoyed by the working people of Australia have improved tremendously.

Mr Ward:

– Tell that to the postal workers.

Mr CRAMER:

– The honorable member for East Sydney (Mr. Ward) cannot deny those facts. Since this Government came into office the volume of consumable goods available to the people has far exceeded that available previously, because of the tremendous development that has taken place in rural and secondary industry.

There has been a great increase of population because of our policy. In general, I think it can be said that the people of Australia have been very happy and very prosperous. We have had our problems, of course. Some people have not fared as well as others. That is admitted. But do not let us be pessimistic. Such problems are inevitable in a young country like this, but they can be overcome. There is no ground for pessimism of any kind.

It is true that there are inflationary tendencies. I remind the committee that for some years past this Government has watched the position carefully and has reminded the people of the dangers of inflation. Well do I remember the Opposition, time after time, disclaiming that there was a need for restrictions or for other efforts to check the tendency to inflation. Back in 1951-52, this Government took unpleasant action to check inflation. Certain of our supporters thought at the time that we had done the wrong thing, but they came to realize that what we did was right. To-day we are telling the people exactly what the economic position of the country is. The claim we make is that the people can have confidence that this Government is prepared to do the right thing by all sections of the community. It is not a sectional government. It is prepared to legislate for the whole of the people. It is prepared to take unpleasant action if it believes that that unpleasant action- would be in the best interests of the people as a whole. It is not here merely to sponsor legislation that panders to a particular section of the community.

In the light of present circumstances, this budget is a practical and a commonsense budget. We have not given the people certain things that we would like to give them. We have not refrained from giving those things because we take a fiendish delight in not giving them. We have refrained from giving them because we know that the economy of the country would not stand such a burden. There is not a person on this side of the chamber who would not like to increase pensions. We increased them by 10s. a week last year, but we cannot make a further increase this year, because the economy would not stand it. We would like to give more money for war service homes. We would like to reduce taxation, wipe out the pay-roll tax and ease import restrictions. We would like to do all of those things, but anybody who takes a sensible look at the economy will realize that we cannot do them. It is in the best interests of everybody to have stability in the economy.

Let us face the facts. This is a young country, with only 9,500,000 people. We are living in a dangerous world. We are situated in the Pacific, very near to eastern countries which are trying to determine their future way of life, but we are essentially a part of Western democracy. There are certain things that we must do if we want to build Australia into a great nation. We must increase our population. There are some honorable members who are opposed to immigration.

Mr Chambers:

– Not opposed.

Mr CRAMER:

– Some people sitting behind the honorable member for Adelaide (Mr. Chambers), including the honorable member for East Sydney, are violently opposed to immigration. We have got to increase our population. If we do not, how can we hope to continue to hold this country, situated, as it is, in the eastern hemisphere? For the purpose of building this country and accommodating its increased population, we must lay down great national works in the fields of power, transport, water supply, mineral production, steel production and communications.

In addition, we must have adequate defence, despite what has been said by some honorable members opposite. The honorable member for Parkes (Mr. Haylen) said in his speech that we should cut defence expenditure by £50,000,000. I am certain that all level-headed and sensible people in Australia will say that we must have adequate defence within our means. If anybody tells me that £190,000,000 is too much for a nation of over 9,000,000 people to spend on defence, I will say that he does not know what he is talking about. Let me remind honorable members opposite of a statement which I think is most pertinent to the question that I am discussing. The honorable member for Parkes wants to reduce defence expenditure by £50,000,000. Let me quote for the information of members of the Opposition some words that were spoken by their revered leader, Mr. Chifley, when he came back from the British Commonwealth Prime Minister’s conference in 1946. The statement is reported in volume 187, of “ Hansard “, at page 1560. Mr. Chifley said -

As a principal power and a member of the British Commonwealth in the Pacific, Australia must be prepared to shoulder greater responsibilities for the defence of that area, including the upkeep of our bases which are essential to the strategic plan.

Earlier, I referred to the heavy burden of military commitments being borne by the people of the United Kingdom, who poured out blood and treasure without stint, to save the world. Therefore I told the conference - and I am quite certain that I expressed the sentiments of both sides of this House and of the people of Australia - that it was recognized that Australia must in future make a larger contribution towards the defence of the British Commonwealth, that this could best be done in the Pacific, and that the approach to a common scheme of defence for this area should be by agreement between the United Kingdom, Australia and New Zealand and thereafter with the United States of America and later with other nations with possessions in this area. These views met with the full endorsement of the United Kingdom and New Zealand.

Mr. Chifley advocated increased defence expenditure, yet the Opposition claims now that defence expenditure should be reduced. Let us face the facts as they are. A young country growing as quickly and developing as rapidly as this country must be faced with the problem of inflation. Any young country - but this country more so than any other - has all the characteristics that tend towards inflation. While there is high capital expenditure and high governmental expenditure, it is inevitable that there will be a tendency towards inflation all the time, because the volume of money in the hands of the people is greater than the volume of consumer goods available for them to buy. The people of Australia cannot have their cake and eat it too. We cannot spend many millions of pounds on capital works and also spend that money in other ways. What many people fail to realize, although it is as simple as ABC, is that our standard of living can be measured only in terms of our production. It is a fact that during the last few years there has been more money in the hands of the people than there have been goods for the people to buy. As a result, there has been a tendency towards inflation.

This Government has had to take certain unpleasant action, lt has had to restrict the availability of money through the banking system, it has had to introduce import restrictions and it has had to increase taxation for the purpose of raising money for capital works. Those courses were necessary. But the big problem is to keep things in proper balance. That is what this Government is ‘ endeavouring to do by this common-sense budget.

Another danger that is always present with inflation is the inducement to draw off more money from private industry, by excessive taxation, to the point where the incentive to expand and produce is destroyed. In that way inflation can be increased, lt must be remembered that almost all of the money that the Government uses originates out of production carried on by private enterprise; but people everywhere seem to forget that fact.

This Government has budgeted to get £1,095,160,000 from taxation. When the Government is asked on what it proposes to spend this money, surely no one would argue when the reply is that it is to be spent on defence, repatriation, pensions and subsidies which are essential to encourage certain industries and to keep costs at a certain rate. A major sum of £243,770,000 is provided for the States. The sum allocated for Commonwealth capital works is £109,738,000, and for departmental expenditure, £56,040,000. The only two items I have mentioned about which there could be any discussion are capital works and departmental expenditure.

Over and over again during this debate reference has been made to the sum of £108,500,000 which has been provided to make up the deficiencies in loan raisings for expenditure by the States on public works and housing programmes. Can any one argue that the sum of £109,738,000 for capital works and services is’ being improperly spent when it is applied to items such as war service homes, the Snowy Mountains hydro-electric scheme, railways, post offices, civil aviation, ships, the atomic energy undertaking and Territories? These are the items on which this money will be spent; yet people are asked to believe that the Government is wrong in spending, it on them. On the one hand there are those who say that it should not be provided for these purposes, and on the other hand it is suggested that much more should be provided for them.

The proposed departmental expenditure of £56,000,000 represents only 5 per cent, of the total budget. It is not a colossal sum. I am not suggesting that there are not sections in the Government service where efficiency could be increased or in which greater savings could be effected, but not many million pounds could be pruned from the proposed departmental expenditure of £56,000,000. Most of the criticism seems to be levelled at the surplus of. £108,500,000. I have just said that some of the surplus is to be used to make up the leeway or shortage in the amount which would normally be provided by loans. We cannot just get loans-

Dr Evatt:

– Why?

Mr CRAMER:

– Simply because there are avenues for investment at high rates of interest as the result of the inflationary characteristics now operating. In addition to that, the Australian Labour party has destroyed the incentive to invest in Australia. Even if all the money required were obtained by way of loan it would still be coming out of the pockets of the people, and the way the Government proposes to spend this surplus is an investment on their behalf.

Mr Pollard:

– In what?

Mr CRAMER:

– In long-term capital expenditure. There is nothing wrong with that. The only wrong thing would be for the States not to spend that money properly, and some of them have shown signs that they are not disposed to do so. Ever since this Government has been in office it has appealed to the State governments to follow some system of priorities in public works. There should be proper co-operation between the States and the Commonwealth for the purpose of indicating the most urgent works to develop the nation, but at all times the States have refused the Commonwealth’s offer of co-operation. If there is any criticism in relation to this matter it can be levelled only at the States. They are the greatest contributors to inflation in Australia, because they are not prepared to conform to the national policy laid down by this Government.

The attitude of the Labour party to the budget has shown a complete lack of understanding of the problems involved. It is prepared to use this chamber as a forum for petty political criticism. The Leader of the Opposition (Dr. Evatt) said that inflation was caused by excess profits; consequently, the cure was to increase taxation and control prices. He suggested, further, that there should be a vastly increased pay-out for pensions and welfare, and that wages should be increased. Could any one imagine a more childish approach - and I describe his approach, advisedly, as childish. Every suggestion by speakers from the Opposition side would, if adopted, result in increasing prices and worsening inflation. I have heard no other kind of idea from honorable members opposite.

Assuming that excess profits have been made in some cases, it is only because the demand for goods has been greater than the supply, so that the producer has been able to increase his prices and the people have still been willing to buy. Surely the common sense thing to do is to increase production, but no suggestion of this kind has come from honorable members opposite. Labour has a fundamental madness in its conviction that prices can be brought down by controlling them. This is a form of political deceit, and is a most dangerous and misleading idea to establish in the minds of the people. One inevitable effect of the widespread control of prices would be the inhibition of production because the incentive to produce would be destroyed. But that is the cure for inflation suggested by Labour. Of course, there may be cases of monopolies, or a tendency to lock out from the use of the people certain things, and it is necessary in such cases for the governments to control prices, but the policy of the Labour party is wholesale price control. That could never cure the difficulties from which the country is suffering at the present time.

The Labour party argues also that this Government is in favour of pegging wages. Never, at any time, has the Government said that it is in favour of doing this. Its consistent argument has been that wages should be related to the productivity of the country instead of being fixed by the method now employed. This Government had nothing to do with the pegging of wages. The Arbitration Court refused to allow wages to rise whenever the C series index figures rose. Subsequent State Labour government interference destroyed the effectiveness of the court’s attempt to help the economy. Most workers would welcome stability in the wage rate if they knew that by so doing they would be contributing to the stabilization of prices. There should be no political interference with the arbitration system in regard to this matter. 1 want now to have something to say about import restrictions. Many people think that this Government imposes import restrictions because it believes in controls. That idea is, of course, encouraged by the Opposition. In fact the Government has nothing of the kind in mind. It does not impose import restrictions as a system of control. The issues are quite simple. We cannot buy goods from overseas unless we have the money to do so. Unless we export goods to establish credits overseas we cannot import goods. Therefore, the Government must take a hand in regulating the kind and quantities of goods that come into this country. That is being done to the maximum degree that this country can afford. A young and growing country needs supplies of certain basic materials for its development. . Therefore, the idea that the Government is purposely imposing unnecessary import controls is a complete fallacy. Goods can be imported only if we export goods to pay for them, draw on credits already established overseas, or raise loans overseas. Therefore, our efforts must surely be directed towards increasing our exports.

Mr Pollard:

– Was there not a favorable balance of trade when this Government took over?

Mr CRAMER:

– This Government increased exports to a fantastic extent. The records show that the rise in exports since this Government came into office has been very great indeed. Certainly, nothing can be charged against us there. It is very foolish for Labour to misuse this debate in an attempt to mislead innocent people into thinking that certain of these matters can be rectified by partisan action. They can be cured only by making an overall survey of the economy, and then taking action that will protect the interests of all sections of the people. Why do honorable members opposite mislead the pensioners? Why do they mislead ex-servicemen?

Mr Edmonds:

– The Government misled them to begin with.

Mr CRAMER:

– Labour has misled them into believing that the Government can give them more money. If we did, we would be destroying the economy, and rendering their future insecure. This Government has never turned its back on any section of the community that it could help, and each year it has proved this. Last year, when it was possible, the Government increased pensions by 10s. a week. In 1949, the last year for which the Chifley Government was in office, Labour failed to increase pensions by one penny. The pensioners are to-day receiving more in proportion to the cost of living than they did under a Labour administration.

Similarly, Labour has deceived exservicemen into thinking that many more millions of pounds could be spend in providing war service homes. Compare our record in this field with that of Labour. In the few short years, from 1950 to 1956, during which we have been in office, we have built more homes for ex-servicemen than were built by all previous governments together. A similar comparison may be made in regard to every other form of governmental expenditure. Only a few months ago this Government put an end to the obnoxious Commonwealth and State Housing Agreement, which was introduced by Labour. The new agreement gives hope to the people who want to own their homes. Labour brought in a policy designed to keep the people as tenants to the governments of Australia. That principle was inherent in Labour’s policy. To-day, things are very different. Only yesterday the Bank of New South Wales announced an increased allocation of finance for home building. As the years go by, and this Government remains in office, more and more people will be encouraged to own the homes in which they live. That was not possible while Labour’s socialistic ideas prevailed.

Mr Ward:

– The Minister should tell us something about the Army.

Mr CRAMER:

– I will tell the honorable member about the Army at the appropriate time - during the debate on the Estimates - and he can then ask me all the questions that he likes. It is about time that the Opposition took this question of the national economy seriously and gave up trying to deceive the people. Why does it not offer some suggestion for overcoming our problems? No Opposition speaker has yet done that. However, the honorable member for Hindmarsh (Mr. Clyde Cameron) is to speak next, and perhaps he will offer suggestions for overcoming the inflationary tendency. I hope that he will not devote his speech to asking for things that he knows cannot be given. I trust also that we shall not hear him give effect to the Opposition’s policy of deceiving the people with political clap-trap.

The CHAIRMAN (Mr Adermann:
FISHER, QUEENSLAND

Order! The Minister’s time has expired.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– This is one of the most interesting experiences that I have had in the whole of the time that I have been a member of this Parliament. We have just heard from the Minister for the Army (Mr. Cramer) a speech, not one minute of which was devoted to telling us one word about the Army. The possible explanation for that omission on his part is that, about three weeks ago, at a most critical stage of the Suez negotiations, in order to show us what a magnificent job he had made of his department as Army Minister, and what a marvellous amount of defence he had been able to provide for us from the £1,000,000,000 that the Government has spent during the last five years, he made the most interesting announcement to the press of the world that he had no fewer than - what do you think? - 900 troops ready to send immediately to the Middle East so that Australia could become embroiled in war! He had 900 troops to show for an expenditure of £1,000,000,000. The Prime Minister (Mr. Menzies), who was at Cairo, had occasion to send an urgent cable to the Acting Prime Minister urging him to have the Minister carpeted and brought before the Cabinet - which was done - and told in no uncertain manner that the Government did not appreciate his announcement concerning the help that he proposed to give to those who wanted to plunge the world into a third world war.

It is quite possible that the Prime Minister agreed with the idea that we ought to become involved in a third world war, but he probably did not want any one to know at that stage that that was the intention of the Government. Before I leave the question of the Suez Canal, 1 want to say in passing that the Australian Labour party’s view is very definite. We say that in no circumstances must this Government plunge the Australian people into another world war. The people of the world are crying out for peace. The people of Australia, perhaps more than those of the rest of the world, want peace and they are determined to have peace. They are demanding that this Government should take this matter to the United Nations, where it should have been taken in the first place. As soon as the dispute flared up, the Leader of the Opposition (Dr. Evatt) indicated, in a public statement, that the proper thing for the Government to do was to take the Suez dispute to the United Nations so that it could be settled in accordance with the United Nations Charter and the rules governing the conduct of countries that are members of the United Nations organization. He pointed out on that occasion that the Prime Minister was concentrating on the nationalization of the canal, when the real issue, and the only issue so far as we are concerned, is the future unrestricted use of the canal.

I believe that the Leader of the Opposition rendered a signal service to the people of Australia, and to every peace-loving person in the world, when he made it quite clear that the Australian Labour party would have no truck with any plan of the Government, based on the announcement of the Minister for the Army that he had 900 troops ready to send to the Suez Canal area, to plunge this country into war. He made it perfectly clear that until the United Nations deals with this matter, all threats, such as that made by the Minister for the Army when he said that 900 troops were available to send abroad immediately, were false and contrary to international law and to the United Nations Charter. The Leader of the Opposition also said that, pending action by the United Nations, the Australian Government has no right to propose, still less a right to organize, the use of Australian armed forces in this dispute. In any event, the Leader of the Opposition went on to say, Parliament should be consulted before any such proposal is entertained. He made the final statement, with the full authority of the federal executive of the Australian Labour party, thus pledging the whole Labour movement in Australia to support the statement, that the attitude of the Government is using gun-boat philosophy to settle this dispute, by threatening to use force against the people of Egypt, has done violence to the letter and spirit of the United Nations Charter. The Leader of the Opposition has urged that before anything in the nature of force is used, or bloodshed or involvement in war occurs, we should refer the whole matter to the United Nations, and he pointed out that that organization must be given firm and unequivocal support. He said that that was the unwavering policy of the Australian Labour party, and that Labour is determined to prevent another world war.

Having only three weeks ago heard from the Minister for the Army the threat to involve Australia in war in connexion with the Suez Canal dispute by sending 900 troops to Suez without the authority of the Parliament or, apparently, of Cabinet, we find that the Minister has now resumed his seat without saying a single word about the department for which he is responsible. One of the most amusing episodes of his speech concerned his attempt to bring in the name of Mr. Chifley in order to try, as he thought, to bolster his argument. I very well remember the same honorable gentleman in this chamber telling the people of Australia that Mr. Chifley was a Communist fellow-traveller, a danger to the security of the country, not fit to govern, and that he should have been thrown out of office. That is what the present Minister and his colleagues were saying in 1949 when they were conducting the election campaign. Now the Minister has the audacity to bring into this debate the name of Ben Chifley, who did so much for Australia, and whom he previously attempted to incriminate and accused of being a Communist, or at least a Communist “ fellow-traveller “.

The Minister does not tell us that when Mr. Chifley was the Leader of the Government we had a five-years defence plan calling for the expenditure of £50,000,000 a year, and not £200,000,000 as this Government is spending. The Minister does not say that we had more to show for the £250,000,000 that we spent in those five years than this Government has to show for the £1,000,000,000 that it has spent on defence over the last five years. The Minister for Defence (Sir Philip McBride) was compelled to admit in this Parliament some days ago that although this Government has spent £1,000,000,000 on defence, we have only 20 more first-class aeroplanes than we had when Mr. Chifley left office in 1949, and that we have only three more naval vessels than we had in 1949. Sir Frederick Shedden, the former secretary of the Department of Defence, who should know something about the matter, has said that although the Prime Minister promised us a war in 1953, and in fact gave us almost a written guarantee that he could arrange a war not later than 1953, the Government is still not prepared for war, except to the extent that it is able to gather together 900 troops for any war that, may arise in the Suez Canal area.

The Minister for the Army said that the reason for our having to cut down loans for housing purposes is that we cannot borrow rooney on the public loan market. The reason for this, he said, is that no one willlend money to the Government at the rate of interest that it is offering, because they can get far more in other avenues of investment. Of course they can, and that is precisely the complaint of the Opposition. That is our criticism of the Government. People who have money to lend can get 18 per cent, for it by lending it to hire purchase firms, and that is a practice that this Government has done nothing to curb. ls it any wonder that the Government finds it impossible to borrow at 5 per cent, from people who can get 18 per cent, through hire purchase companies? I may mention that if one invests with firms such as the Austin Motor Company (Australia) Proprietary Limited, the Broken Hill Proprietary Company Limited, or General Motors-Holden’s Limited, one may obtain 100 per cent interest on one’s investment.

What the Government seems to forget, and what the people should not forget, is that when Mr. Chifley was Prime Minister we could obtain all the money we needed by public borrowing at 3i per cent. Every loan that the Labour government floated was over-subscribed, even though the interest rate offered was only 3i per cent., and not 5 per cent, as it is at present. All. those loans had to be closed about a fortnight before the scheduled closing date, because they were over-subscribed. The people then had complete faith in the Government, because they knew that if they invested £100 in a government bond they could sell it later for £100. To-day, they may invest £100 in a Government bond which next year may not be sold for more than £90. Some of those, who did in fact invest in. government bonds when Mr. Chifley was. Prime Minister find it very difficult to-day to obtain £82 for a £100 bond. That i* why people now are refraining from investing in Commonwealth loans. They can see how this Government’s financial policy has reduced the value of government bonds.

The Government says that it is not in favour of controlling wages. At the Premiers Conference last month I heard the Treasurer make it quite clear to Mr. Cahill, the Premier of New South Wales, that wage control is precisely the policy he wanted the State governments to adopt. He said that he wanted the New South Wales Government to repeal the legislation under which the New South Wales Industrial Commission is compelled to apply the automatic cost of living adjustments. He wanted the Victorian Government to do the same thing. The Liberal Government of Victoria has since decided to peg the State basic wage in the same way as the Commonwealth basic wage has been pegged by the Arbitration Court.

I cannot understand the attitude of the Minister for the Army in this connexion. He is all in favour of pegging wages.

Mr Cramer:

– I am not.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– But the

Minister is!

Mr Cramer:

– T said, “ Leave it to the court “.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– The Arbitration Court has pegged wages. If it is right for the Arbitration Court to fix the price of wages, which is the only commodity that the worker has to sell, is k not equally right that some authority, whether it be the Arbitration Court or the Parliament, should have the right to fix the prices of the goods that the worker has to buy?

Mr Cramer:

– The Arbitration Court fixes only a minimum wage.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– But as soon as the shearers went out for something more than the minimum wage, Government supporters described their actions as a strike, and they used the full force of the Arbitration Court to try to break it.

The Government says, according to the Minister, that it is in favour of fixing wages according to productivity. If the views of the Government are in line with those of the Minister, as expressed in that statement, then wages should have been considerably increased since 1953. In fact, wages were pegged although productivity in Australia increased by 52 par cent, in the period in question. But this Government that claims to be all in favour of increasing wages in accordance with productivity has not taken a single step towards establishing a productivity index in order to measure any increase that has occurred in productivity. [ mention that fact not because I agree that is what ought to be done but simply to emphasize that the Government preaches one thing and then, by its failure to take any action calculated to implement what it preaches, indicates clearly that it has no intention whatever of increasing wages even in relation to productivity.

The Minister for the Army (Mr. Cramer) says that the workers would welcome stability in wages. Of course they would, if by “ wages “ the Minister means the standard of living; but I have a very strong suspicion that when he uses the word “ wages “ in this context he is referring to nominal wages. If that is what he means, it is not true to say that the workers will be satisfied with stabilized wages because that is precisely what they have now. The worker wants a wage calculated in terms of purchasing power. He does not mind a stabilized commodity wage, but he is not prepared to accept a stabilized nominal wage while the people for whom he is working continue to reap higher and higher profits year by year.

Then, the Minister says that the Government strongly favours import restrictions, because, according to him, they are necessary in order to enable us to bring into the country basic materials that we need urgently and in order to keep out for the time being materials that are unessential.

If that is so, how does the Minister account for the fact that for weeks now I have had on the notice-paper a question seeking from the Government an explanation of its action in allowing the Admiral Television Company to import into this country components for making the “ Admiral “ television set, a set which is not up to the standard required by the Australian Broadcasting Control Board and which will not give buyers the service they think they will get from it when better quality components are being made in’ Australia in sufficient quantities to meet the full demand? What I want to know is how the Government can justify its action in giving £100,000 worth of dollars to the Admiral Television Company for the importation of parts which, are inferior to those that can be produced here and which do not comply with the recommendations of the Australian Broadcasting Control Board. In view of that action, how can the Government claim that it is carrying out a selective import policy aimed at bringing in only basic materials and essential machinery?

The Minister also said that this Government had, to use his own words, increased exports almost fantastically. The truth is that it did not increase exports at all. What actually happened was that as a result of the tremendous increase in the price of wool in 1951, when it sold for £1 per lb., the Government found that, not through any action on its. part but through the sheer accident of happenings overseas, that accident being the tremendously high price being paid for wool which is one of the main export commodities of Australia, our export balances were building up in. spite of its failure to do anything to assist in that direction.

Mr Cramer:

– We are still waiting for suggestions.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– 1 have to deal with the Minister’s speech first. He said that last year the Government gave the age pensioners an increase of 10s. a week. Of course it did, but last year was an election year. This year, when the election is over, the poor old people and their relatives, whom the Government induced to vote for it last year, are forgotten. They will get nothing this year. Although the cost of living has increased enormously since last year, the age pensioners are to get absolutely nothing this year because the election is over. So cynical has the Government become in its attitude towards pensioners, whether they be aged persons, widows or invalids, that it is treating them like political footballs, giving them a small increase just before an election and nothing whatever after the election.

Then, the Minister had the audacity to talk about war service homes. Why, for nearly six months now I have had on the notice-paper a notice of motion that seeks to discuss in this Parliament the war service homes position with a view to forcing the House to vote on the matter and with a view to giving honorable members opposite an opportunity to vote with the Opposition if they agree that more money should be made available for war service homes. Up to date, the Government has not only refused to provide the opportunity for a vote to be taken, but also has denied me the opportunity to speak to that motion. The motion to which I refer reads -

That this House resolves that lack of finance for war service homes is defeating the purposes of the War Service Homes Act, and that inordinate delays in granting loans are creating a black market in interest rates, depriving exservicemen of their right to own their own homes in breach of the solemn undertaking given by the Government to the men and women who defended this country against foreign aggression.

That is the plain fact. This Government, which talks about war service homes, has consistently refused Parliament the opportunity to debate the motion of which notice has been given for nearly six months now. lt seemed to me that out of the various misdeeds of the Government the Minister for the Army selected the ones he thought would give the Opposition the best opportunity to show actually how weak the Government is, because he then had the audacity to talk about the CommonwealthState Housing Agreement. It is true that this Government altered that agreement last year. It is also true that Mr. Playford said that as a result of this alteration, which this Government had forced upon the South Australian Government, the workers in South Australia who bought houses from now on under that agreement would be compelled to pay an additional 10s. a week as a result of the higher interest rate which the Commonwealth Government is forcing upon the State governments.

The Leader of the Opposition (Dr. Evatt) has put forward an excellent plan for dealing with the situation with which we are now confronted. Even the “ Sydney Morning Herald “ was forced to admit in a special article that his plan was the most effective and most constructive put forward in this Parliament by any Leader of the Opposition for the last twenty years. He suggests, first, that there should be an excess profits tax, bearing in mind the fact that while the basic wage has been pegged for the last three years company profits have risen to £555,000,000 a year. The Leader of the Opposition suggests that there ought to be an excess profits tax to deal with this situation. He goes on to advocate prices control, pointing out that until we have effective prices control we can never have stabilized wages. He, like other members of the Opposition, does not want to see nominal wages rising. We want to see prices falling so that it will not be necessary to have cost of living adjustments every quarter. But it is evident that the Government has taken no notice of these suggestions. As the Leader of the Opposition has quite rightly pointed out, we have prices control right now; but the difference between the present situation and the one we should like to see obtaining is that at the present time the people who control and fix the prices of the things which the monopolies have to sell are the directors on the boards of the monopolies concerned. They sit round their board tables and, in secret conclave, fix the prices which the Australian consumers are forced to pay.

The Labour party says that these are matters which concern every citizen in the community and, therefore, the proper people to fix the prices of commodities are those people who are answerable to the electors every three years and who can be ejected from office if they do not carry out their job properly. For instance, what justification can there be for the action of Broken Hill Proprietary Company Limited in increasing the cost of steel by £3 a ton recently? No one can say that that company is losing money, because last year it showed record profits and, during the last seven years it has been able - out of profits, mind you - to increase its capital from £37,000,000 to £105,000,000 and, at the same time, pay huge dividends year by year.

In the face of that fact, that company has the audacity to increase the price of steel by £3 a ton! The reason given for the increase was not that it was necessary to meet any increased cost of production but that the company intended to expand its capital still further, not by way of additional call upon the shareholders but by way of increased charges to the Australian users of steel who do not own a single share in the company. It proposes to carry out this expansion by the arbitrary imposition of increased prices upon the Australian community.

When speaking of social services, the Leader of the Opposition dealt with the situation that has been caused by the high cost of living, in relation to these unfortunate old people - the age pensioners, invalid pensioners, widow pensioners and others. He indicated clearly that Labour would grant increases immediately upon taking office. That was his promise at the last election. We believe that social service payments should be no less than they were when fixed by Mr. Chifley in 1948. If the proposal of the Leader of the Opposition had been accepted by the Australian people, the age pensioners to-day would be receiving £4 16s. a week instead of the miserable payment of £4 a week. We do not say that that is all they should get, but it is 16s. a week more for a single person and for married pensioners 32s. a week or 64s. a fortnight more than they are getting now and more than they are likely to get from this Government for another twelve months. Yet this Government has a surplus of £108,000,000 that it cannot spend. It says that it cannot afford to grant another 16s. a week for pensioners, but that would not cost one-fifth of the surplus that it admits it will have.

Government supporters talk about an export drive. This Government has done nothing to increase exports, but the Leader of the Opposition has indicated that if we want to save our overseas balances we have to get out and find markets for dried fruits, wines, wheat, butter and the other things that we cannot now sell overseas. What better market is there for these goods than the markets of Asia? In Asia there are 1,000,000,000 people. If their standard of living was improved by only 1 per cent., we in this country even with a population of 50,000,000 could not supply the products to satisfy their additional demand. Millions of people are dying in Asia every year because they cannot get enough to eat; yet here in Australia thousands of people are going bankrupt because they cannot find markets in which to sell their surplus goods. We believe, therefore, that this Government should conduct a vigorous drive in order to obtain the full advantage of the enormous Asian markets that are open to us only if we have the initiative to move into them.

I read a very interesting letter that appeared in the “ Adelaide Advertiser “ in 1939. It was written by Mr. Vowles, who was the leader of the Anti-Communist Labour party in the Senate in South Australia last year. He said -

We are a young country and we realize that we should be friendly with Powers who have twenty times our population.

He went on to say -

The farmers of Australia to-day are practically all bankrupt on account of short-sighted policies with Powers who could have as easily been our friends. Nothing can be gained by attacking the form of Government to which other nations subscribe.

I do not know whether Mr. Vowles would subscribe to the same views now, but I do. Just because a government has a different policy from the one we have is no reason to say that we will not trade with it. No one would say to the grocer in the corner store, “ Before you sell me this tin of salmon, you have to tell me how you voted at the last election. If you are a Communist, you will not sell me any goods; I will go to the next shop “. That is precisely the attitude adopted by this Government.

As I said previously, high interest rates are causing the restriction of credit, and that is causing unemployment. The immigration programme, in itself, is not causing unemployment. Unemployment is only a symptom of some deeper cause, and it is no use any one blaming immigration. In a country of 9,000,000 people that should be able to support 50,000,000 people, it is useless and silly to say that immigration is the cause of our trouble and that to solve the present trouble we should not bring more immigrants into the country. We ought to rectify the present position so that not only the immigrants who are coming here but also our own people can find jobs in full and plenty. What this Government should have done when the situation in Western Australia developed was to make the money available for the widening of the railway line from Fremantle to Kalgoorlie. Every unemployed immigrant and every unemployed Western Australian worker could have been given a job overnight if the Government had made money available for widening the railway from Fremantle to Kalgoorlie. That would have been a better way in which to expend defence money than the way £1,000,000,000 has been wasted on defence in the last five years. If the standardization of railway gauges had been regarded as a major defence project - and that is what it is - the Government would have had something to show not only in the event of an immediate war but also for the generations to come in the next 100 years or even longer. But that would not occur to this Government!

Unemployment has developed also in South Australia. What better programme could there have been for South Australia i nan for this Government to regard, as a defence measure, the broadening of the railway line from Port Pirie to Adelaide ;md from Port Pirie to Broken Hill? The unemployed in South Australia could have been absorbed in developing a standardized railway line in conjunction with the Western Australian plan and that, for the first time in history, would have given a uniform gauge from Fremantle in the west to Brisbane on the north-east coast of Australia. But this Government has never thought of anything like that.

The Liberal member for Chisholm (Mr. Kent Hughes) was perfectly correct when lie said that the defence expenditure of the present Government was entirely wrong. He pointed out also that national service training was antiquated and was run on the system that operated in 1914. So long as this country has a Portuguese army or, as the honorable member for Parkes (Mr. Haylen) said, more chiefs than Indians, with a whole host of brass hats - more generals than privates - telling this Government, which has not enough brains to make up its own mind, what to do, it will continue with this antiquated system of national service training. There should be far less infantry training and far more Air Force training. The honorable member for Indi (Mr.

Bostock), who was an air marshal in World War II., and is now a Liberal member, has argued repeatedly that we want a strong Air Force in this changing world situation.

The CHAIRMAN:

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

Mr JOSKE:
Balaclava

.- I feel on this occasion that I should express what is in my mind and what I believe is in the minds of most members of this House - that is, the feeling of great pleasure that to-day, the Prime Minister (Mr. Menzies) and Dame Pattie Menzies have returned to this country. I feel also that I express the feelings of members of this House when 1 refer to our great admiration and pride at the splendid efforts of the Prime Minister towards the cause of world peace. I emphasize particularly the words “ world peace “, because of the disgraceful remarks made by the honorable member for Hindmarsh (Mr. Clyde Cameron) when he suggested that this Government favours war. He knows perfectly well that his remarks to that effect were quite erroneous. My language when I say that is, I am sure, the language of understatement.

I turn now to the subject of the budget. I turn to that with pleasure because this is a budget debate and during the course of the remarks of the honorable member for Hindmarsh we heard nothing whatsoever about the budget. On the contrary, his remarks were of much the same type as those we have heard from Opposition members earlier to-day. They were in the nature of a diatribe such as is usually heard in the Domain or on the Yarra bank. In speaking of this budget, I join with many members in the host of congratulations which have been bestowed upon the Treasurer (Sir Arthur Fadden) for bringing forward so many budgets and in fact establishing a record. It is a heavy task to produce a budget. Tt requires a great deal of time and attention, many days of heavy labour and the consideration of many matters. Consideration must be given to how much money should be raised, how it should be raised and how it should be expended. What great wisdom and great courage is needed to provide for the budgetary needs of this country! Not only must one consider the internal economic circumstances; in addition, he must consider the international situation, particularly at the present time, lt is quite idle for the honorable member for Hindmarsh to talk about building railways as a defence measure, when it is well known that at present, as in years gone by, we have to keep in mind the great danger of war. lt is because this Government has always borne in mind that possibility, and has been determined to make Australia strong in order to be able to defend itself, that we have been able to ward off war. The Treasurer (Sir Arthur Fadden), in addition to having regard to all these circumstances, had to pay attention to the fact that we have been enjoying a period of prosperity, and during the last twelve months we have been faced with certain difficulties that are usually associated with periods of prosperity. Whenever there is a prosperity bubble, there is a danger of the bubble bursting and the economy crashing. Therefore, in framing his budget, the Treasurer had to endeavour to maintain the prosperity of the nation, and to prevent the boom bubble bursting. In these circumstances, the right honorable gentleman produced, very properly, what might be called a holding budget. That this course was justified is borne out by the fact that the Opposition has not really offered anything in the nature of constructive criticism of the budget. It is quite idle for honorable members on the other side to say that this tax or that tax could be wiped out and benefits given here and there; we must remember that if a tax is lifted, there results a loss of revenue. It costs money to grant further benefits. Assuming a tax is wiped out, and it is desired to grant additional benefits, it is necessary not only to raise by other means the amount that the tax, if retained, would have yielded, but also the amount necessary to provide for the proposed additional benefits. It must be remembered that this budget provides for greater benefits. Honorable members opposite have wilfully ignored the fact that the budget will provide benefits for invalid and age pensioners at a cost of £10,000,000 over the expenditure in this field last year. That is a tremendous increase.

Certain honorable members have commented on the fact that the Treasurer has budgeted in this financial year for a sur plus. The honorable member for Hindmarsh asserted that the surplus revenue would not be expended. I think that the Treasurer made it quite clear that, in view of the existing economic circumstances, it was necessary to budget for a surplus. Every member of this committee should know that, during the next twelve months, the surplus revenue will, in fact, be expended. As we know, it is necessary for the Commonwealth to advance money to the States for public works. In addition, a large amount will be needed to redeem loans that were raised during the war years. Money for loan redemption can be provided only from revenue, or by the issue of treasury-bills. It is acknowledged that nothing is more inflationary than the issuing of treasury-bills, and the Treasurer, quite rightly, was determined to avoid adding to the inflationary pressure in the community. As the loan market might not provide in this financial year sufficient money to fill prospective new loans and to redeem maturing loans, it was necessary for the Treasurer to budget for an adequate surplus.

I should like now to say a few words about the amount of money that the Commonwealth advances to the States for public works, because the extent of this provision is not generally realized. Under this budget, direct payments totalling £243,000,000 will be made to the States and, in addition, the States will receive more money indirectly from the Commonwealth. The Government has taken upon itself the obligation of underwriting the States’ public works programmes, and it is likely that, in this financial year, the loan money received from the public for this purpose will fall short by from £80,000,000 to £90,000,000. Some people are prone to ask why this money should be provided for the States, and they assert that governments spend too much money. But if one asks them whether they think that such activities as housing and the provision of schools, roads, water supply, irrigation and so on should be continued, they say, “ Of course, those things should go on “. Indeed, many members of the Opposition have stated that housing and the provision of roads and other things should be continued. I think that every member df this committee would agree that they should be provided. In these circumstances, it is clear, in view of the economic circumstances of the country, that the expected surplus revenue will be expended.

As I have said, honorable members opposite have offered no really constructive criticism of the budget. Their comments have been directed to suggestions for dropping this or giving that, but not one member of the Opposition has suggested how, if taxation were reduced, the developmental services that 1 have mentioned could be provided. The reaction to the budget boils down to this: Some people say, “ We should have got something out of this budget; taxation should have been reduced “. Others say, “ We have had our share of the prosperity that the Government has brought about. Nevertheless, we are jibbing because the Government has seen fit to tighten up in order to maintain Australia’s prosperity “. This kind of criticism is offered by persons who should know better. If they enjoy the benefits of prosperity, they should be prepared to accept their share of whatever burdens have to be borne. After all, it is no very great burden for a person to tighten his purse strings at present, because it should not be very long before he will be able to loosen then again.

This Government is dealing with the economic difficulties of the country by financial measures, which is the only way that it can deal with them under its limited constitutional powers. One of these measures, which has been applied for some time, relates to central bank credit. One of the functions of a central bank is to control the amount of money that can legally circulate in the community at any time. Sometimes it is desirable that money should flow freely. At other times, it is necessary to tighten up and restrict the flow of money. Of recent months, both this Government and the central bank have been compelled to restrict to a degree the amount of money flowing in the community, because it was considered that there was too much money circulating. Of course, that kind of thing has to be watched very carefully. There is no reason to suggest that this Government has done otherwise than to watch it very carefully. Should substantial unemployment result there can be no doubt that the Government will see that more money flows into the community, because the policy of this Government is that there should be full employment. The Minister for Labour and National Service (Mr. Harold Holt) has produced many figures in this chamber to show the remarkable degree of employment that this Government has been able to provide. Only recently he showed decisively that the Labour notion of full employment was 5 per cent, of unemployment. That notion was expressed in a statement made by the honorable member tor Parkes (Mr. Haylen) some years ago. He said that full employment was a desirable thing, but of course you could not expect to have less than 5 per cent, unemployment, and that that really amounted to full employment. The Chifley Government’s White Paper on unemployment- was on much the same lines. It also showed that there is really no such thing as absolutely full employment; that whilst absolutely full employment is a desirable objective, it can never really exist. The Minister for Labour and National Service has produced figures which show that we have had, over many years, a degree of employment that might properly be described as full employment.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– Over-full employment.

Mr JOSKE:

– As the Minister says, it has been over-full employment. In fact, there have been available more jobs than persons to fill them.

I should now like to refer to the problem of overseas balances - a problem that is giving the Government very great concern. It has arisen because the volume of exports has not kept pace with the volume of imports, owing to export prices falling. That has not been due to any falling off in the actual volume of goods exported. In fact, we have increased our exports, but overseas prices have come down, and because of the amount of money which this prosperous community has had to spend, a great volume of imports has been coming into the country. Therefore, the trade balance has been going strongly against us, and the Government has been compelled to make the import restrictions more severe. That is a policy which the Government has been reluctant to follow, because it does not believe in controls. The Australian Labour party, however, does believe in controls, and if it had its way, the import restrictions would be far more severe than they are now. Fortunately, in recent months the balance, which had been swinging against us, has begun to swing our way. Things are being kept in hand now by these restrictions and, indeed, the prices we have been receiving overseas for our exports have improved. With that, and the greater amount of trade which we are getting, it should not be long, let us hope, before it will be possible to ease the restrictions which are now being suffered by importers. I feel certain that the Government will be eager, at the earliest possible opportunity, to ease these restrictions. The Government, early this year, made two Ministers, of great working capacity, available for the purpose of improving trade. They have thrown themselves into the job and trade has improved very considerably during this year as the result of their efforts.

In regard to the problem of inflation, the problem of too much expenditure on private consumption, the Government has been endeavouring, by means of the financial measures it has taken, to bring consumption expenditure to a proper level. It is necessary, of course, to see that more money Hows into public investment, and it is also necessary to direct the savings of the country further into public investment; but with regard to Labour’s suggestion of a profits tax. which was reiterated to-night by the honorable member for Hindmarsh (Mr. Clyde Cameron), this Government is certainly opposed to it. A profits tax is very difficult to administer and also very difficult to police. It is a tax from which the ultimate revenue is very small. The method which this Government has adopted has been to increase the tax on company income to 8s. in the £1 earlier this year. The returns of many companies have been falling off while their costs have been increasing. The result is that a great number of companies, including hire-purchase companies, will find it exceedingly difficult to pay this 8s. in the £1 company income tax, and their profits this year will not be so very excessive. The policy of the Opposition regarding a profits tax and prices control represents a curious instance of the gyrations and antics which the Leader of the Opposition (Dr. Evatt) engages in from time to time. The committee will remember that it is not so very long ago that the right honorable gentleman was proposing to give magnificent tax allowances to these profit- making companies. Now, his contortions have taken him in the opposite direction, and he wants to cut down their profits.

The effect of a tax on profits would be that capital would cease to be put into businesses. In addition, the amount of income which companies would have to plough back into their businesses would be curtailed. The expansion of companies and of industry over the years has, in great part, been caused by this ploughing back of profits, and because of these good profits there has been ample employment, or, as the Minister has put it, even over-full employment, high living standards, good working conditions and splendid wages. What do we see in Western Australia now? We see a Premier, who has unemployment on his hands, proposing severe and dictatorial legislation with regard to profits. He will have tremendous difficulty in trying to administer that legislation, and no doubt before very long it will become a dead letter. But what will be the result in the. meantime? Money will no longer be put into business, capital will not flow into the country, and the unemployment which he now has on his hands will become far worse. He will then come cap in hand to the Commonwealth Government, and while asking for money, back in his own State he probably will be blaming the Commonwealth for causing it all, instead of blaming his own 3 stupidity. The truth is that a profits tax hurts most of all the employees in industry. As soon as profits are taxed, heavy unemployment commences. Without profits, industry cannot keep up full employment or pay good wages, such as those being paid today.

As for prices control, it is well known that the first prices that rise under prices control are the controlled prices, lt is also well known that prices control limits competition and fosters inefficiency, shortages and black markets. There is no ultimate satisfaction to be had from prices control, because it results in steeply rising prices. That is the kind of remedy that the Leader of the Opposition chooses to produce to this Parliament. It should not be forgotten that the reason why his party was thrown out of office in 1949 was because of the shortages and the black markets that existed then. Yet he would bring back a state of affairs which could lead only to shortages and black markets! 1 shall now turn to the matter of wages. lt has been put to us that the system of wage adjustment is one of the big factors in the inflationary spiral. That factor is that wages have been subject to an automatic quarterly adjustment, so that as soon as prices rise costs rise, and wages rise at the end of each quarter. That goes on and on in an upward spiral, and there is nothing to stop it. If one compares the position in this country as to profits on the one hand and as to wages on the other hand, it will be seen that during the last seven years both have risen two and a half times but wages are five times as great as profits; and when one considers the cost of production in this country, one sees that the amount that is to be attributed to wages is five times the amount to be attributed to profits. It is, therefore, of tremendous importance to ensure that this automatic spiralling of wages should not continue, and that the inflation caused by reason of that situation is stopped.

The Acting Prime Minister called his recent conference of Commonwealth and State Ministers with a view to doing something about the spiralling of wages. What attitude does the Opposition take up in regard to the proposition that there should be a uniform basic wage throughout the Commonwealth, and that the wage in each * State should not continue to spiral as the Labour governments in some States have allowed it to spiral by applying automatic basic wage adjustments? The Leader of the Opposition (Dr. Evatt) agrees that there should be uniformity of wages throughout the Commonwealth. But what is he prepared to do about it? He is not prepared to allow the Commonwealth Industrial Court to decide the question of uniformity. He merely cites some State judge who has suggested that the Commonwealth court is not the body to do that. The Leader of the Opposition does not come out and say, “I do not think that the Commonwealth court should decide the question of uniformity “, but merely seeks to take refuge behind the words of some State judge.

Well, what is to be done about this matter? Is each of the States to endeavour to come to some uniform arrangement? Obviously not, because that is ridiculous. The effect of six State decisions would be to bring about a state of complete lack of uniformity, and the only way uniformity can be established is by the Commonwealth court dealing with the matter.

However, there is a curious feature about the Opposition’s attitude to this matter. Although the whole of the policy of the Opposition and its leader is unification - one law for the Commonwealth, uniformity for the Commonwealth - when it suits the Leader of the Opposition he backs down on this policy of uniformity and runs away from it. It has been well said, by the Prime Minister I think, that the only thing consistent about the Leader of the Opposition is his inconsistency.

I referred earlier to the fact that the budget before honorable members was a stability budget, intended to hold the prosperity which this country has been fortunate enough to be experiencing during the last few years. In order to emphasize that stability, one should contrast the state of affairs that existed before this Government came to office with the present state of affairs. Before the present Government assumed office there were shortages, blackouts, black markets and strikes. Since the Government has assumed control, those things have become things of the past. We also find that the Communist stranglehold over industry and production, and the Chifley double £1 - that is, the ordinary £1 which could not buy anything because of shortages, and the black-market £1 which could buy under-the-counter goods at highly extortionate prices - have disappeared. This Government has also managed a huge immigration programme and has provided great sums of money for defence, repatriation, health, social services, development, and so on.

This Government has had in mind that Australia is an important part of the British Commonwealth, and that in the first few years of its nationhood has had to go through two world wars and a serious depression, and that now is the very time for expansion. We need complete and rapid expansion in this country. In time of war people are prepared to spend everything they have, and we should deal with the present position that, faces us: as we deal with matters in time of war. We owe it to our destiny and to the destiny of this country that we should engage in as much expansion as possible while we are living in times of prosperity, and we should not do anything that will not allow that prosperity to continue. We should pay everything possible to the duty we owe to this great country of ours, our native land.

Mr. CAIRNS (Yarra) [9.361.- The best way in which the people can ensure the future of the country and safeguard its interests, is to get rid of the present Government. The honorable member for Balaclava (Mr. Joske) has outlined the alternatives which will face the people of Australia in the near future. Me said that he does not favour an excess profits tax. The reason that he does not favour such a tax is only too obvious. He represents and supports the people who would have to pay the tax. The Labour party represents the working class of this country, who are the people for whom the honorable member for Balaclava advocates a policy of wage stabilization. He also supports the Victorian Government which has abolished cost of living adjustments, although retail prices in that State are rising more rapidly than at any time during the past seven or eight years.

The alternatives facing this country are to have a government which will control excess profits and excess incomes and control lending through the private banks - and in other ways - and thereby control inflation, or to have a government which allows inflation to continue to ravage the country. There are not two problems, there is only one. That is because the present Government is part of the inflationary forces in this country. The Government is the executive committee for those concerns which are boosting inflation; it works hand in glove with those people. The other alternative is to have a government which has a responsibility to the community, which will not permit inflation to continue and which will impose reasonable taxes upon excess profits and other excess incomes, and use the proceeds for proper investment through public utilities and social services.

The honorable member for Balaclava realizes the effect of measures such as that. He said that the effect of a tax on profits would be that capital would cease to be put into business. It will not so cease, but there will be a reduction of investment in that direction, and that is precisely what we want. I direct attention to this outstanding situation, as revealed in the figures of the outlay of enterprises expressed as a percentage of the total outlay. In 1952-53, the investment of public authorities was 11.8 per cent, and private investment was 13.5 per cent. In 1953-54 investment of public authorities was 9.8 per cent and private investment was 20 per cent. In 1954-55 the investment of public authorities was 10 per cent, and private investment 23.3 per cent. In 1955-56 the investment of public authorities was 10.5 per cent, and private investment 21.5 per cent.

The honorable member for Balaclava stands for private investment as against public investment and for boosting investment for the sake of excess profit. The honorable member stands for covering this country with elaborate motor service stations when we have not sufficient roads: for covering the country with departmental stores when our schools are crowded; for covering it with elaborate commercial buildings when we have not sufficient houses for the people. That is also what the present Government stands for, and that is the alternative with which the people are faced.

Let us consider what has happened to the distribution of the gross national income during recent years. One of the main functions that the Government had to serve when it came to office was to bring about a redistribution of the national income in the interests of the business concerns that it serves. The figures prove that it has done a very effective job. I should like members of the Australian Country party to listen to them. The farmers’ share of the national income was, in 1952-53, 13.9 per cent.; in 1953-54, 11.8 per cent; in 1954- 55, 9.7 per cent.; and in 1955-56, 8 per cent. For how long are members of the Australian Country party to continue to represent persons whose share of the national income is falling like that? That is a question which they should seriously be asking themselves. Let us have a look at what has happened to wages and salaries. In the total under this classification are included the amounts which go to managers and highly paid persons. Wage and salary earners’ share of the national income was, in 1952-53, 48.5 per cent.; 1953-54, 47.8 per cent.; 1954-55, 48 per cent.; and 1955- 56, 48 per cent. In those percentages here has been no more than stability, but within the category there has been a very serious departure from justice and equality, because some wage and salary earners have been able to increase their incomes by a higher percentage than the percentage increase in the total. They have done fairly well out of the Government’s inflation. Some of them, according to the Minister for Labour and National Service (Mr. Harold Holt), actually vote for the Government. On the other hand the standard of living of a great many wage and salary earners has fallen seriously over the last three years. An examination of the real wage increase, the nominal wage increase, shows that it has fallen an average of 3 per cent, over that period, but the standard of living of some persons has fallen by far more than 3 per cent.

Let us look at the income of free enterprise. What has happened to the income of the persons whom this Government represents in this Parliament? The total of unincorporated business income, company income, depreciation allowances, rent and interest, in 1952-53 was 27.4 per cent, of the national income; in 1953-54, 29.2 per cent.; in 1954-55, 30.9 per cent.; and in 1955-56, 31.5 per cent. Of course, the Government has paid off, and paid off well, and that is one of the consequences of this Government’s being in office. We have the clear, stark position where a government in office, drawn from and supporting business, is representing business in a stark, close, economic sense. This is the lesson that this budget drives home.

From the table just a few minutes ago we heard the Minister for the Army (Mr. Cramer) deliver a speech on the budget without mentioning the Army. He was followed by the honorable member for Balaclava, who opened his speech by challenging the honorable member for Hindmarsh (Mr. Clyde Cameron). He asked, “What has defence to do with the budget?” Since the Government has been in office £1,080,000,000 has been spent on defence, and what has that to do with the budget! It has everything to do with the budget. Let me remind the committee also of this fact: Not only have we suffered inflation seriously in the last five or six. years, but also we have suffered it more seriously than has any other country. These figures were published in the “ International Labour Review “ statistical supplement of December, 1955. In South Africa, prices in 1948 were regarded as being 100; in 1955, they were 140. In Canada, prices in 1948 were 100; in 1955, they were 122. Prices in the United States of America were 100 in 1948, and 112 in 1955; in Germany, 100 in 1948, and 112 in 1955; in the United Kingdom, 100 in 1948, and 142 in 1955: and in Australia, 100 in 1948, and 190 in 1955. In Australia prices have risen more than twice as much as have prices in any other country with which we are supposed to be competing upon the international market, and this Government has been in office since 1949 with the selfavowed objective of controlling and preventing inflation. It has said that it wants to prevent costs from rising in Australia in such a way as to endanger our ability to compete in overseas markets. The Government has failed upon every count in endeavouring to do this.

There are a number of other important consequences of the Government’s failure and I should like to direct the committee’s attention to those consequences. One of them is the rising general debt. The Australian community has been forced more and more into debt during the time that the Government has been in office. This is a consequence which the Government will very soon have to meet, because next year it has to try to repay an internal debt of £259,000,000, a sterling debt of £7,000,000, and a dollar debt of £17,000,000. That is one of the consequences of inflation. This consequence has to be related to the position of the balance of payments, in which respect we have a problem arising, first, from the rising import component of industrial investment. The more we invest in Australia, the more we require to import to support that investment, and we have a fundamental structural problem here which the honorable member for Balaclava will never see in his time relieved without the most severe import control. We have a further fundamental problem involved in that. At the same time, we have to face the payment of increasing debt overseas. Our balance of payments is also dependent upon another very critical factor. It is dependent, and increasingly dependent, upon the inflow of capital and upon the repayment of interest and profits to those who invest. I should like to cite just a few figures to illustrate that point. The inflow of capital represented in 1953-54 only 2.7 per cent, of our receipts; in 1954-55, 10.1 per cent.; in 1955-56, 13.1 per cent.; and it shows every sign of rising further. This Government faces a balance of payments situation which is becoming increasingly dependent upon borrowed money from overseas, at the same time as our internal prices are rising more rapidly than those of countries from which we want to borrow. This means that we have to provide in Australia excess profits to persuade those countries to invest in Australia. We can get capital, therefore, only in excess profits industries; we cannot get capital from overseas for the essential kinds of industrial development upon which our national development depends. That situation, and many other aspects of it, have produced a condition which, I think, was extremely well put by the Treasurer in his 1952-53 budget speech, when he said -

Democracy and free enterprise in the modern world tread a precarious path between the twin evils of inflation and unemployment . . .

A precarious path, in which the Government is led by the dancing member for Balaclava who, with facetious words, criticizes the Leader of the Opposition for expounding a constructive policy! That is the kind of. precarious path we tread. The budget speech continued -

In Australia we have had experience of both within the past twenty years. … To find and keep a mid-way path throws a heavy responsibility upon governments.

That is a responsibility which the Government did not accept in 1952-53, and has never accepted since, because inflation has continued. The Treasurer told us in his budget speech, his eighth or ninth, that we were reaching a most critical point in the problem of the control of inflation in this country. When a Government has reached this situation after nine years of ineffectual economic policy, how can any one expect that the people of Australia will continue to support the Government?

Mr Turnbull:

– What nine years is the honorable member talking about?

Mr CAIRNS:
YARRA, VICTORIA

– I shall leave that for the honorable member for Balaclava. I want to outline the alternative to the bankruptcy of the present Government, which has been so fully revealed in its record since 1949. The alternative offered under the constructive policy of the Australian Labour party, which has been stated by Opposition members during this debate, is a more equitable distribution of income within Australia. If inflation is to be controlled - and it must be controlled - the Labour party says that that control must be exercised in accordance with the principle that I have just stated. That would mean increased taxes on excess profits and high individual incomes and an increase of family and dependants’ allowances for persons in receipt of incomes lower down the scale.

Mr Anderson:

– That is what Karl Marx said.

Mr CAIRNS:

– If Karl Marx said that, he was quite right. The Labour party stands for the control of inflation by equitable taxation and not by the method that is employed by the present Government, which does not impose taxation in accordance with ability to pay and which, in its raising of revenue through the Postal Department, proposes to increase the postage on an ordinary letter by a half-penny, but not to increase the postage on secondclass mail matter posted by business concerns - a matter which reveals clearly just how sectional the Government is in its outlook and how inconsistent is its policy with that of the Labour party as outlined quite clearly by the honorable member for Melbourne Ports (Mr. Crean). The application of the principle of an equitable distribution of income requires an increase of social services benefits and of pensions, and we make no apology for saying that. I say to the Minister for Defence (Sir Philip McBride), who was in the chamber about half an hour ago, that we would find the money for increased pensions by taxing the people who have the money and who can afford to pay, and, at the same time, we would reduce a lot of the waste that occurs in the department that he administers. Labour’s attitude on this matter was stated by the honorable member for Eden-Monaro (Mr. Allan Fraser) and the honorable member for the Australian Capital Territory (Mr. J. R. Fraser), who cited figures to prove our argument.

The second principle for which the Labour party has stood in this debate is that there must be a direction of investment to meet national needs. We believe that there must be capital issues control. The Treasurer, in his 1951-52 budget speech, indicated how fundamental was capital issues control in a policy of inflation control. The Prime Minister (Mr. Menzies), before he became involved in such minor excursions overseas as those in which he has recently been involved, said in the course of his famous economic statement of 14th March, 1956-

There may a good deal to be said for introducing selectivity into the demand for capital by some system of capital issues control.

If the leader of a “ big business “ government says that a good deal can be said for capital issues control, we can be certain that a good deal can be said for it.

Mr Whitlam:

– They have it in Great Britain.

Mr CAIRNS:

– Of course they have it in Great Britain. At the recent conference of Commonwealth and State Ministers, this Government tried to secure from the States - it can be done in this way; no great constitutional problems are involved - capital issues control by offering them an extra £10,000,000. Another point that is involved in the Labour party’s policy is the direction of investment through the banking system. That can be done in two ways: First, through the special account provisions, which have been proved to be inadequate; and, secondly, by the qualitative control of advance policy. This method was tried in 1 954, but the trading banks flatly refused to carry out the directions of the Governor of the Commonwealth Bank to maintain their liquid assets ratio at 25 per cent. It is the policy of the Labour party to pay proper regard to this matter and to ensure that, in this field as in the other, investment is properly directed and controlled. As a result of the failure of the banks to comply with the directions of the Governor of the Commonwealth Bank, the Treasurer had to admit in his 1955-56 budget speech - and this is one of the main factors behind the condition of inflation from which we are suffering to-day -

This most formidable upsurge of spending has been facilitated by a far too generous expansion of credit on the part to the banking system together with the rapid growth of hire purchase finance.

We must come to grips with these matters if inflation is to be controlled. Labour’s policy extends to public control over imports to secure those commodities that are needed for national purposes, and we make no apology for saying that.

Motion (by Sir Eric Harrison) put -

That the question be now put.

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

AYES: 59

NOES: 43

Majority . . 16

AYES

NOES

Question so resolved in the affirmative.

Question put -

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

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

AYES: 44

NOES: 62

Majority 18

AYES

NOES

Question so resolved in the negative.

Amendment negatived.

The general debate being concluded,

First item agreed to.

Progress reported.

page 623

BROADCASTING AND TELEVISION BILL (No. 2) 1956

Second Reading

Debate resumed from 11th September (vide page 362), on motion by Mr. Davidson -

That the bill be now read a second time.

Mr CALWELL:
Melbourne

.- The Opposition opposes this bill, even though the Postmaster-General (Mr. Davidson) has pleaded with the House to pass the measure because of the increased expenditure by the Postmaster-General’s Department on broadcasting. The Opposition takes the view that, if the Government had honoured its election promise of 1949. and had put value back into the £1, there would be no need for any increase of broadcasting charges to-day.

Mr SPEAKER:

– Order! There is too much audible conversation.

Mr CALWELL:

– Yes, Mr. Speaker, and J notice that Ministers are mainly responsible. Because the Government has allowed value to ooze out of the £1 it has been forced into a position where it has to impose burdens on the people additional to those that it inflicted in the little horror budget of March last. At that time, the further impositions were of the nature of increases of sales tax and company tax and other imposts. Now the Government proposes to hit the people who own radio receivers, and those who are buying television sets. The fee that has been charged since 1952 - £2 for a radio receiver - is to be increased to £2 15s. That charge will apply in what the Government has called zone l. We of the Australian Labour party say that it should not be necessary, if this country were well governed, to have such an increase forced upon the people.

Of course, the Government has been running the radio services and the Australian Broadcasting Commission at a toss for a long time. In his second-reading speech, the Postmaster-General, arguing in favour of an increase of the fee from £2 to £2 15s. a year, said that the Government last year had lost £1,721,000. He put it this way -

The estimated expenditure in the current financial year, £5,766,000 is £1,721,000 more than the total revenue anticipated.

Mr Davidson:

– That is for this year; you said last year.

Mr CALWELL:

– I am sorry. I accept the correction. What the Minister did not say was that last year, the loss was £1,569,000 and the year before it was £996,000. This Government has been going steadily broke in the radio world for a number of years past. Now it is saying to the unfortunate people who are already burdened with other taxes, “ You must pay an additional 15s. a year for the privilege of being entertained over the national service and the commercial services, or for being enlightened and informed by broadcasts from the National Parliament “.

In 1932, there were twelve national stations and 43 commercial stations in Australia, a total of 55. On 30th June, 1949, there were 37 national stations and 102 commercial stations, a total of 139. During the war years and the immediate post-war years, the Chifley Government increased the number of national stations substantially, though we did not take the whole credit for the increase from 1st July, 1932, when the Australian Broadcasting Commission commenced its activities. In September, 1956, there are 53 national stations and 107 commercial stations, a total of 160 broadcasting stations throughout Australia.

This represents some development of our national networks, but the growth could have been greater, because this Government has had a lot of money at its command in recent years. It is collecting more than twice as much revenue from the people as did the Chifley Government; the comparative exactions are about £1,200,000,000 and £550,000,000.

In 1940, the Menzies Government appointed a committee under the National Security Regulations which became known as the Gibson committee. I served on that committee, which was representative of both Houses of the Parliament and both sides of politics. Every recommendation brought down by the Gibson committee was passed into law. I remember that one of them originated in the mind of the United Australia party member for Boothby at the time, Dr, Archie Grenfell Price, a distinguished educationist in South Australia. He suggested the legislation which provided that a separate fee of 10s. each be paid annually for every additional radio that was in a home or a motor car belonging to a home, in addition to the fee of £1 for the first radio. This Government takes great credit in the Postmaster-General’s speech for the fact that, in 1952, that provision was wiped out; of course, at a cost. The fee of £1 was raised to £2. A person who had only one radio set had to pay 100 per cent, more for the privilege of using this modern device for the transmission of entertainment and information. A person who might have had three radios, and paid £1 for the first and 10s. for each additional set, paid no more at all under the new provision. Therefore, again the action instituted by the former Postmaster-General, the honorable member for Richmond (Mr. Anthony), was designed to benefit the wealthy members of the community at the expense of the poorer sections.

The extraordinary thing about these rises that have taken place since the passage of the first legislation in 1932 is that they have always been made at the instance of a Postmaster-General who was a member of the Australian Country party. A PostmasterGeneral belonging to the Australian Country party has always been given the task of slugging country listeners. I will say for the present Minister and his predecessor that they did not relish the job, and that neither of them looked very happy when he was performing his task. The Minister said, with a grandiloquent wave, that pensioners are not expected to pay any more; and that is proper. Why should they be asked to pay more? The concessional fee allowed to them does not mean very much after all. The free licences that have been issued to blind persons over the age of 16 and to persons or authorities conducting schools will be continued. I suppose Government supporters have given themselves a very hearty pat on the back because they have done this. The Minister came to the germane part of the proposal when he said - . . the reason for raising the main licencefee is to bring revenue from broadcast listeners’ licences and miscellaneous charges closer to the expenditure incurred by the Government in connexion with the overall control of broadcasting generally and the maintenance and operation of the national broadcasting service.

We of the Australian Labour party ask the Government, rhetorically, “Why is this expenditure so high? “ and we reply, “ It is because the Government has failed to keep down costs”. Expenditure has risen, and therefore the people will be asked to pay more by means of the 15s. increase on a £2 licence for the average home each year. Those who have plenty of radios in their homes, and also radios in their motor cars, will be covered by the one fee. We think there is no reason why the Government should have gone back on the recommendation of one of its supporters who served on a very fine committee headed by the late Senator Gibson. As I have said, the Government argues that the people ought to pay because it is in financial difficulties not only over broadcasting and television, but also over postal rates and other matters under the control of the Postmaster-General. The Post and Telegraph Rates Bill 1956 will be considered by this House to-morrow. In an attempt to prove that the increased fee is justified, the Minister told the following story, which was more fictional than factual: -

Since the present fees were introduced nearly five years ago

The increased fees then imposed represented an increase of 100 per cent, on the fees that obtained when the Chifley Government went out of office - there has been a progressive expansion and improvement of the national broadcasting service . . . There has also been a marked improvement in programmes, particularly those of benefit to the community from the educational and cultural stand-points.

From our point of view, there has been no great improvement in either cultural or educational standards over the last 20 years. There have been no improved techniques generally in the field of amplitude modulation broadcasting. Indeed, broadcasting has been in the doldrums for a number of years. One still hears the Johnny Rays and the Frank Sinatras as frequently as their equivalents were heard five or ten years ago.

Mr Whitlam:

– And Bing Crosby has lasted the whole time.

Mr CALWELL:

– Yes, and he is so much more stale now than he was when he began. The honorable member for Gwydir (Mr. Ian Allan), who has been associated with broadcasting, knows that there is nothing new in broadcasting now as compared with the services of ten or fifteen years ago. So, it is idle for the Minister, in an attempt to justify the increased fee, to talk about the progressive expansion and improvement of the national broadcasting service. I wish both the national and commercial services could improve. There is not one honorable member who has not turned the dial through the whole range of stations in his State and then switched the radio off because there was nothing worth listening to on either national or commercial stations at the time.

Mr Mackinnon:

– The honorable member’s view is slightly jaundiced.

Mr CALWELL:

– It is not. People who know something about it will tell the honorable member that I have stated the position correctly. I wish it were better. I listen regularly to the radio. The honorable member is a wealthy grazier with substantial property holdings, and I have no interest in the land, but, like him, I can at least appreciate the quality of some Sunday morning broadcasts. Only occasionally on the national stations, and never on the commercial stations, does one find broadcasts of educational value.

The Minister said also - the estimated expenditure by the Australian Broadcasting Commission in the present financial year on sound broadcasting alone is £3,812,000.

That is a very substantial sum. There was a time in the history of national broadcasting when the Australian Broadcasting Commission was expected to balance its budget, but in recent years the members of the commission have apparently thought that the government of the day should subsidize the commission to almost any limits if it decides to import artists into the country and pay them almost fabulous sums for the services they render. The present atmosphere of irresponsibility about the commission is very regrettable. The Minister added, referring to the technical responsibilities which the Gibson committee considered should be properly discharged by the Postmaster-General’s Department -

On the technical side, for which the department is responsible, the working costs have also grown appreciably through inescapable causes . . .

We join issue with the Government on that point. The causes were not inescapable. They were the Government’s floundering and blundering in not keeping inflation under control. The Minister continued -

  1. . and it is expected that the expenditure this year will be of the order of £1,826,000.

That is a big expenditure for purely technical purposes.

The Minister then dealt with the Australian Broadcasting Control Board. I acknowledge paternity of that body, but I wish I had never been advised, encouraged or persuaded to agree to its establishment, because it has been completely useless. The sooner we devise better means of supervising the acitivities of the commercial and the national stations in conjunction, the better it will be. The Minister expects that an additional 35,000 listener’s licence-fees will be paid. I do not know that there will be another 35,000 listeners. If things continue as they are going now, with more and more people being thrown out of work, it is much more likely that there will be 35,000 fewer listener’s licences instead of 35,000 more, so the Government’s expectation of getting licence-fees costing 15s. a year more from an additional 35,000 people, as expressed through the mouth of the Minister, is not likely to be realized. I hope that those honorable gentlemen opposite who are not threatened with unemployment are alive to the fact that there is a good deal of increasing unemployment throughout the community.

In 1924, when the broadcast listener’s licence-fee was first imposed, the fee in zone 1 was 35s.; in zone 2, 30s.; and in zone 3, 25s. In the second year in which the fees operated they were 30s., 25s. and 20s., respectively. On 1st August, 1925. the fees became 27s. 6d., 20s. 6d. and 17s. 6d., respectively. On 1st January, 1928, the fees became 24s. in zone 1 and 1 7s. 6d. in zone 2. Then they dropped, on 6th August, 1934, to 2ls. in zone 1 and 15s. in zone 2. On 1st September, 1940, we reached the lowest amount that has been charged, when the fees were 20s. in zone 1 and 14s. in zone 2.

It is to the discredit of this Government that it has increased radio listener’s licence fees from 20s. to 55s. in zone 1, and from 14s. to 28s. in zone 2. Yet the Govern ment expects us to vote for its bill. The Minister himself said, “ for the reason.mentioned “, and because he believed thai the increases should not impose any hardship on listeners generally he commended the bill to honorable members. Well, we think that hardship will be imposed on the people, and for that reason and others we intend to vote against the bill.

The other day, when the Minister foi the Interior (Mr. Fairhall) was recommending to the Parliament that a particular proposal for the erection of studios for the Australian Broadcasting Commission in Perth be referred to the Public Works Committee for investigation and report, I made the observation that the 1942 act provided that, at some time in the future, that is, at some time after the passage of that act, the head-quarters of the commission should be established in Canberra. That claim was disputed by the former Postmaster-General, in the debate. He said that there was no provision in the act for any particular place to be the head-quarters of the Australian Broadcasting Commission. He said that the . commission moved from place to place. And so it does! I have taken the trouble to peruse the Australian Broadcasting Act of 1942 and I find in Part II., Division 1, section 7 (4) the following provision: -

The Head Office of the Commission shall br established in the Australian Capital Territory on or before a date fixed by the Minister. 1 ask the Minister now to fix a date in the proximate future when the head-quarters of the commission shall be established in the National Capital. It is here that it belongs, and it is here that it should be established. The provision in the 1942 act is exactly as the Gibson committee wrote it. We could not ask the commission to come here during the war. While hostilities were in progress the national news was broadcast from Canberra, but the commission, headed by Sir Richard Boyer and the staff headed by Mr. Charles Moses, saw to it that the national news service head-quarters were taken to Sydney once the war ended, and every device that could be used has been used to prevent the head-quarters of the commission from being established in Canberra.

The other day, I charged the commission with seeking the approval of the Cabinet to erect much-needed studios throughout the Commonwealth, in all our capital cities, not because it wanted to help the staffs in the State capitals, but because it wanted another excuse for not establishing its headquarters in Canberra. As a result of my activities some years ago, the commission was eventually compelled to make application to the Minister for the Interior for land on which to build its headquarters in Canberra. As a result of my persistence in the matter the commission was obliged to submit plans for the establishment of its buildings here, but it has done no more than submit plans and follow a policy of frustration and passive resistance. I do not think that the Australian Broadcasting Commission will be worth having until it is established in Canberra. In any event, I am convinced now that the commission form of control of the national radio network is not a good one. I have seen it in operation over the years. I have seen it when there have been five non-Labour members on it. I have seen it when three out of the five commissioners were members of the Labour party and I have seen it when only one commissioner was a member of the Labour party, and 1 do not think that the commission form of control of this great national activity is satisfactory, or does justice to the vast amount of money spent on it by Australian people.

Mr Ian Allan:

– It is better than having it under political control.

Mr CALWELL:

– I would rather follow the system which obtains in New Zealand, which has a Minister for Broadcasting and a Department of Broadcasting, the head of which is a permanent public servant. The former New Zealand Labour Government led by Mr. Peter Fraser introduced that system of control. In all its years of office the Holland non-Labour Government has continued that form of control. It is that form which, with all its risks and difficulties, I would prefer to the system we have had in Australia over the years, and which has been of no value to the country.

I have my own feelings about the manner in which Sir Richard Boyer behaved in regard to the Australian Broadcasting Commission. I resent deeply his action in taking “ Advance Australia Fair “ off the air as the signature tune for the national news, and substituting another tune for it. I heard it said that the Australian Broadcasting Commission opens the day’s proceedings with “ Advance Australia Fair “ and closes them with the singing of “ God Save the Queen “. When I was in New Guinea, where you have to get up early in the morning, or the sun scorches you, I heard the 6 a.m. sessions, and there was no “ Advance Australia Fair “ played then. I resent also the action of the commission in taking Radio Australia away from a body that was using it for the purpose of putting our view, and the view of our allies, to the world, and for the promotion of trade, and making it into an instrument for regaling the countries of Asia with the programmes of Jack Davey and Bob Dyer. I do not know what good that does for Australia. I would prefer to see this instrument used to better advantage, and it is to the credit of the Minister for External Affairs (Mr. Casey) that it has been used to much better advantage recently than it was being used for some time previously. I would take Radio Australia away from the Austraiian Broadcasting Commission, because it is not a medium of entertainment. It is our instrument for telling the world what our policy is in respect of trade, international affairs and so on. It should not be used by people who think that every broadcasting medium should be under their control. I would much prefer to see the Department of External Affairs, or the News and Information Bureau, or a combination of government departments, operating Radio Australia as it was operated during the war to the great advantage of Australia. I think that the people who took it over mauled it and mutilated it, and that it will never be any good until it is taken away from them.

Mr Curtin:

– AH the broadcasters have an Oxford accent.

Mr CALWELL:

– Well, 1 know that some of the accents used by the Australian Broadcasting Commission announcers have improved. I remember well that when 1 was a member of the Gibson committee the committee was told that what the Australian Broadcasting Commission wanted was a southern English accent. The commission regarded that as the ideal English accent. One of my friends who listened to some of the broadcasters over the Australian Broadcasting Commission said that he thought their accent in those days was a mixture of Oxford and adenoids. Well. we have outlived that, and I hope we will outlive the commission’s system of control. With these few observations I indicate the attitude of the Opposition to this bill. We oppose it because we do not think these increases should be forced on the people no matter how good a case the Government might make on the question of costs for increasing the charges to listeners. We do not accept any responsibility for what the Government has done in the matter of not controlling inflation. We refuse to vote with honorable members opposite to increase the burdens on the people.

As for television at £5 for a licence, I could - not care less if there were no television in this country for the next twenty years. Let us have houses, hospitals, schools, roads, sewerage, water supplies and all these things before luxury hotels in capital cities and television for the people in Melbourne and Sydney, the only two capital cities to be provided with these facilities at the present time. First things have to come first. If the Suez Canal crisis is only half as serious as the Prime Minister (Mr. Menzies) has indicated in press statements that he believes it to be, then we ought not to be thinking of television, at least until we have done something for the soldiers of this country and for the increasing population of this country in respect of the primary needs for houses, schools, hospitals and the things that are essential to our well-being and national greatness.

Mr PEARCE:
Capricornia

.- I find myself in complete agreement with the honorable member for Corangamite (Mr. Mackinnon) when he interjected while the honorable member for Melbourne (Mr. Calwell) was speaking and said that the latter seemed somewhat jaundiced to-night because he failed to bring his usual brightness to this debate.

Mr Calwell:

– Did he say that?

Mr PEARCE:

– He said that, and I agree with him. It is easy to understand the honorable member’s opposition to the Australian Broadcasting Commission and all it stands for, because when he was Minister for Information in the Chifley Government his intention was to take over all the broadcasting stations in Australia and place them all under one political control.

Mr Mackinnon:

– Under a dictator.

Mr PEARCE:

– He was going to tell the radio stations where they got off and who would run them, and he was going to be the boy who ran the whole show. When I look at the figures he quoted showing the advancement in the field of radio over the last 24 years, I find that in 1932 there were twelve national stations under the control of the Australian Broadcasting Commission and 43 commercial stations. I find also that in 1949, after eight and a half years of Labour rule, the number of national stations had increased to only 37, but the number of commercial stations had increased to 102. It was thought very seriously throughout the country at that time that the Chifley Government was not keen to establish further national stations because its idea was to nationalize the commercial stations. It was quite willing to allow private enterprise to erect radio stations in the various parts of the country so that it could nationalize them in accordance with the socialist doctrine of the Labour party at that time. So, we saw the advancement of the comercial stations with the money of private enterprise, but a very minor advancement in the field of the national stations under the Australian Broadcasting Commission.

Since this Government has come into office it has been able to give to the commission the wherewithal to make some rather startling advances in the field of radio. Whilst it may be all very well for the Melbournesider to talk about his radio stations down there, it is typical of the attitude of those who live in capital cities to forget about the country listener. During the period this Government has been in office the development that has taken place in radio has been truly of great benefit to people who live in the country. Radio stations have been extended in that field tremendously. Power has been increased to various stations and we now find that out of a total of over 2,000,000 listeners only a small proportion - 12,500 people - can claim the reduced fee because they cannot get reasonable reception due to the fact that they are living some distance from a radio station. That speaks volumes for the great advancement that has been made in the field of bringing radio to the people of this nation. To-day, instead of 37 national stations as was the case in 1949 when this Government took office, we have 53 national stations scattered throughout the length and breadth of the land and, in addition, we have sixteen other stations including short-wave stations and Radio Aus.tralia, making a total of 176 radio stations in operation in Australia at the present time.

This advancement of which I have spoken has been of great benefit to country people. When one looks at the new stations that have been established under the control of this Govrnment one finds that here in Canberra station 2CN has been established since 1949. Then we go to Smithtown, Murwillumbah and Bega in New South Wales. In Victoria we have Warrnambool, and in Queensland the trial frequency modulation station in Brisbane and also additional power to stations at Cairns, Mackay, Gympie and Southport. In South Australia there is 5LN at Port Lincoln, 5WM at Woomera and 5 MG at Mount Gambier. In Western Australia, we have 6AL at Albany and 6NM at Northam, whilst in Tasmania there is 7QN at Queenstown which is operating on 200 watts. So, dotted throughout Australia these additional radio facilities are available to country people in particular. In 1956-57 the Australian Broadcasting Commission proposes to establish in New South Wales a further station at Glen Innes, and in South Australia two further stations at Berri and Penola respectively. Those new stations represent real advancement to people who live in the country areas.

In addition to the actual new works that have been carried on under this Government in the short space in which it has been in existence - less than seven years - major improvements have been made to national stations which give better reception and better coverage throughout Australia. In the Northern Territory the power of the Darwin station has been increased, and in New South Wales major improvements have been carried out at Corowa and Grafton. In Victoria, the Sale station has been improved, and in Queensland we have additional power and new equipment at Rockhampton and at Longreach, in the heart of the golden west. At the latter town the new station has greatly improved coverage so that it now covers virtually half the land space of Australia. At Mackay the power has been increased to provide additional coverage. In South Australia improvements have been made at Crystal Brook and Alice Springs, whilst in Western Australia stations have been improved at Geraldton and Perth. In Tasmania the stations at Hobart and Launceston have also had major improvements carried out.

All this has been done by this Government in less than seven years. In the current financial year, the Australian Broadcasting Commission plans to improve Radio Australia and the stations at Glen Innes, Lyndhurst, Shepparton, Mackay, Renmark, Wagin, Kalgoorlie and Hobart. If one looks at the map of Australia and spots the positions of the national stations he will see that to-day in all the populated areas of this country a national station is operating over a wide area for the benefit of the people. As I said earlier, the proof is that out of the 2,000,000 people who have taken out a radio licence only 12,500 have claimed that their reception is poor because of the distance they live from a national station.

What is the purpose of this bill? It is that in every household in which one set or a number of listening sets are located the occupants shall pay for the entertainment they receive £2 15s. a year, whether they have one or more sets, portable sets or sets in motor cars. What is £2 15s. in terms of costs to-day? How does it measure against the comparative cost of a radio licence when Labour was in office, when there was a hiatus in the development of radio services in Australia? Measured in terms of to-day’s prices, it is a reasonable charge. It works out at slightly over ls. a week. In the case of a man with a wife and three dependent children, the cost to the family is 2d. a head a week. For £2 15s. one might be able to buy a decent sort of microgroove record for a radiogram, but it would not be enough to buy even a small packet of cigarettes each week for a year. For that sum, however, listeners receive for a year all the benefits that flow to them from the Australian Broadcasting Commission.

It is all very well for the honorable member for Melbourne to cavil at the programmes presented by the Australian Broadcasting Commission, but is there any one in Australia who can say with truth that he has listened from morning to night to programmes broadcast by radio stations in other parts of the world and then has said, “ I am well pleased with everything that I have heard during the day “? The Australian Broadcasting Commission is catering for human beings, so it must provide a variety of programmes. There are many occasions when 1 have switched off my radio set in sheer disgust at a programme broadcast by the Australian Broadcasting Commission, which, to my mind, has been drivel, yet 1 have discovered that nearby there are people who like “ Blue Hills “ - or whatever is the title of the obnoxious programme that I cannot stand. They say, “ lt is an ideal programme. 1 like it. Mum will not miss it, and we do not get our lunch until it ends “. Different people, different tastes.

Let us be fair to the Australian Broadcasting Commission and recognize that it is doing a grand job in finding out the reaction of the public to its programmes, profiting by experience and giving to Australia programmes as well balanced as any of those broadcast in any other part of the world. The standards of the Australian Broadcasting Commission are high. It is bringing culture to us. It broadcasts light music, classical music, talks and what I describe as some pretty ridiculous items. But it has to try to please all sorts of people. It has to try to satisfy me at one time of the day and the honorable member for Herbert (Mr. Edmonds) at another time of the day. It is pretty nearly impossible to cater for all tastes, but the commission is doing a grand job by bringing entertainment to the people, especially those who live in the sparsely populated parts of the country.

What are the alternatives to an increase of the broadcast listeners’ fee? One alternative is to pay the losses of the commission with money taken from the pockets of the taxpayers. It is about time we insisted that the person who uses a government service shall pay for it, if he can. Surely to goodness it is worth £2 15s. a year, or about ls. a week, to have a radio in the house with which to receive the programmes broadcast by- the Australian Broadcasting Commission! That is not a’ great imposition. In return for that ls. a week, the radio listeners of Australia will receive good value indeed. If we do not provide the Australian Broadcasting Commission with the money that it needs, if we do not raise that money either by taxation or by increased licence-fees then, of necessity, its standards must be lowered. It will be forced to abandon some of its betterclass programmes, which cost a lot of money. There is nobody in this Parliament” who would agree to that. We want the programmes to be of the highest possible standard.

Most of the members of the Opposition, including the honorable member for Melbourne, live in city areas, so they do nol realize what it is like to be isolated in the country. I know that it is a grand thing for me to go to Melbourne and see a live show on the stage, or to see the latest movie when I go to Sydney or Brisbane, lt is pretty horrible to live in the country and not have a theatre within 1,000 miles. The Australian Broadcasting Commission is bringing high-class cultural programmes to people who are starving for culture. It is their only source of good programmes throughout the year. I appeal to honorable members to be fair. We must keep the Australian Broadcasting Commission going at a decent standard, so that it can continue to provide the amusement, culture and education that it has been providing in itexcellent programmes. If we agree that it must have enough money to do that, then we should say that those who use the service should pay for it.

The Government is being fair to people who live in areas where radio reception is not very good. They will be charged only £1 8s. a year. At present there are 171,000 pensioners, who pay only 10s. a year for a radio licence. That concession is of great benefit to them. Blind people over sixteen years of age are given radio licences - free of charge. So the Government is catering for the blind people, for the pensioners and for the people who live in areas where reception is not good. There are about 2,000,000 radio listeners now. and the number will increase. Radio sets are still being sold in Australia. On the shoulders of those 2,000,000 people and the few thousand others who will be added to their number this year there rests squarely a responsibility to pay something to meet the costs of the excellent service provided by the Australian Broadcasting Commission. I support the bill. I think that every fair-minded Australian who believes in getting value for his money and in giving money for value will support it, too.

Debate (on motion by Mr. Duthie) adjourned.

House adjourned at 10.57 p.m.

page 631

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Butter and Cheese

Mr Webb:

b asked the Minister for Primary Industry, upon notice -

  1. Has the decrease in the butter subsidy by £1,000,000 resulted in an increase in the price of butter and cheese which has priced these essential commodities out of the reach of many consumers?
  2. ls it a fact that this increase has further reduced the purchasing power of the federal basic wage, and has made worse the plight of the pensioner and others on fixed incomes?
  3. Will he consider restoring the subsidy?
Mr McMahon:
LP

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

  1. 1 mention for the sake of clarity of this complex subject that there are four major factors connected with the implementation of the Commonwealth guarantee under the Dairy Stabilization Plan that have to be taken into consideration at the commencement of each dairying year. They are, first, the level of the guaranteed price to the farmer; secondly, the amount of Commonwealth .subsidy available; thirdly, the estimated export values of butter and cheese for the year and, fourthly, the domestic price levels ‘ of those commodities. This year an increase in the guaranteed price based on the costs of production, a decrease of £1,000,000 in the government subsidy and uncertainty on overseas market values made some increase in the home-consumption prices of butter and cheese necessary. It is not anticipated that the domestic price increases of lid. per lb. on butter and Id. on cheese will have any material effect on home-consumption sales.
  2. The weekly consumption of butter and cheese in Australia averages about 8 and 2 ounces respectively. On this basis these price rises would cost each individual consumer about an extra Id. a week. At about the same time the federal basic wage was increased by 10s. a week.
  3. The Government has budgeted to spend £13,500,000 on butter and cheese subsidies for the current year. This is a firm decision which was discussed with the dairy industry leaders at the time.

Broadcasting of Parliamentary Proceedings

Mr Leslie:
MOORE, WESTERN AUSTRALIA

e asked the Postmaster-General, upon notice -

  1. What is the cost of broadcasting the proceedings of Parliament?
  2. ls the whole of this cost borne by the Australian Broadcasting Commission?
  3. If not, how is the cost charged and apportioned?
  4. How does this cost compare, stated in figures, with the cost of providing a programme of orthodox forms of entertainment and other regular broadcast matter?
Mr Davidson:
CP

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

  1. Approximately £48,500 per annum.
  2. The cost is shared by the PostmasterGeneral’s Department and the Australian Broadcasting Commission.
  3. Expenditure of approximately £5,500 is incurred by the Post Office on the services of technicians directly engaged in work associated with broadcasting Parliament and for the appropriate portion of the cost of operating and servicing the radio transmitters concerned. Annual costs to the commission approximate £43,000 for the rental for broadcast relay channels and to cover the allowances and salaries paid to announcers engaged at Parliament House.
  4. Any .comparison of the cost of broadcasting Parliament with the costs of broadcasting other types of programme could be misleading .since programme costs generally vary widely. For example, a normal day-time programme is not as expensive to produce as certain classes of evening programme consisting of orchestral music, plays or variety production which may be relayed throughout the national network. On the other hand, the cost of broadcast relay channels it higher in .the day-time, but the commission does not make a .’great deal of use of such channels during the day.

Bega Broadcasting Station

Mr ALLAN FRASER:
EDEN-MONARO, NEW SOUTH WALES · ALP

r asked the PostmasterGeneral, upon notice -

  1. When will the temporary mast of broadcasting station 2BA Bega be replaced by a higher permanent mast?
  2. Is it a fact that the .great potential value of this regional Australian Broadcasting Commission station is being substantially reduced by poor radio reception, even in some areas close to Bega?
  3. If he needs any confirmation of this point, will he go down to -Eden an’d try to hear -2BA there?
Mr Davidson:
CP

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

  1. During the financial year 1958-59.
  2. The reduction in potential value is verymuch less in the case of 2BA Bega than at a number of other stations which have been awaiting the provision of these masts for several years.
  3. Observations have been made at Eden where the electrical noise is somewhat higher than is usual in a town of this size. It is expected that the signal strength of 2BA will be increased from one millivolt per metre to two millivolts per metre when the anti-fading mast is provided.

Telephone Services

Mr Webb:

b asked the Postmaster-General, upon notice -

  1. Are several hundred persons in the Tuart HillMount Yokine area, some of whom have had applications in for over two years, waiting to have the telephone installed?
  2. When will additional telephone facilities be made available to this area?
Mr Davidson:
CP

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

  1. Applications for telephone service in the Tuart Hill-Mount Yokine area at present number 448.
  2. Tt is difficult at this stage to indicate when complete relief in the Tuart Hill-Mount Yokine area will be given. A site has been selected for a new portable automatic exchange and cable from the Mount Hawthorn exchange to the site has been laid. Pending installation of the exchange, ISO applicants will be connected to the existing Mount Hawthorn exchange over the next six months.

Television Sets

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

n asked the PostmasterGeneral, upon notice -

  1. Is it a fact that, after an extensive study of problems encountered and mistakes made in the early design of television receivers in the United States of America ami elsewhere, the Australian Broadcasting Control Board has determined a series of technical standards to be observed by Australian manufacturers in the production of receivers for use in Australia?
  2. Do these standards include a recommended intermediate frequency channel for television receivers selected to avoid danger of interference to the television picture from other radio services?
  3. If so, has he any knowledge of reports that one potential Australian manufacturer proposes to disregard the official standards and produce receivers using an intermediate channel that will be subject to interference?
  4. So that the Australian public will be given the opportunity of protection by the standards set by the board, will he consider registering a mark or certificate that may be used by manufacturers adhering to the official standards to guide the public in purchasing sets?
  5. Will he issue an early warning to members of the public that they will be exposed to the dangers of unsatisfactory television reception if they buy receiving sets that do not conform to the official standards for good performance set by the board?
Mr Davidson:
CP

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

  1. After extensive study, and in the light of experience in other countries, the board, after consultations with representatives of a number of manufacturers selected by the Associated Chamber of Manufactures, recommended a series of technical standards to be observed in the production of television receivers for use in Australia.
  2. Yes.
  3. The board’s investigations indicate that one manufacturer has produced receivers using intermediate frequencies of 21.25 and 26.75 megacycles per second. Under some circumstances these receivers could be subject to interference which would be most difficult to eliminate but which would not be experienced by receivers using the standard intermediate frequencies.
  4. The Commonwealth has no power to regulate the manufacture and sale of radio equipment. In any case the procedure suggested by the honorable member would give rise to administrative difficulties of great complexity.
  5. This has already been done.

St. Mary’s Filling Factory

Mr Ward:

d asked the Minister for Defence Production, upon notice -

  1. What authorities were consulted by the Government, and upon whose advice did it act, in deciding to proceed with the construction of a filling factory at St. Mary’s, New South Wales?
  2. What particular types of ammunition are to be manufactured in this factory?
  3. What is the approximate amount by which it is now expected that the originally estimated cost of £23,200,000 will be exceeded?
  4. What is the explanation for the enormously increased cost of this project which is now anticipated?
Sir ERIC HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

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

  1. All the appropriate defence authorities.
  2. The factory is designed to fill and assemble all types of service ammunition.
  3. It is not so expected.
  4. See 3.

Cite as: Australia, House of Representatives, Debates, 18 September 1956, viewed 6 July 2017, <http://historichansard.net/hofreps/1956/19560918_reps_22_hor12/>.