House of Representatives
3 October 1956

22nd Parliament · 1st Session

page 1093


ESTIMATES 1956-57 J093


.- For the benefit of the honorable member for Scullin (Mr. Peters), I point out that the story about the ostrich burying its head in the sand is a complete myth. The ostrich does not bury its head in the sand. The reason this story is used by the Labour party is that the Labour party believes a good deal in mythology.

Earlier this afternoon, the honorable member for Hindmarsh (Mr. Clyde Cameron) attacked the Minister for Trade (Mr. McEwen) on the matter of television. I cannot understand the interest that is displayed by the honorable member in television. He has said times without number in this chamber that he represents the depressed classes, the unfortunate poor, whose faces are ground into the dust by honorable members on this side of the chamber. Why is he always interested in television? Can the reason be that the workers support the introduction of television?

I was interested in the reply made by the Minister for Trade to the honorable member for Hindmarsh because it showed the difference between the views of the Labour party and our views. However, I should like to criticize the Minister, if I may, on his choice of words. He said that the great difference in outlook that is displayed in the debate was the difference between socialist thinking and non-socialist thinking. I wish to criticize his choice of the words “ nonsocialist thinking”. That is an understatement. Our thinking is the thinking of free men, who like to act on their own initiative and who desire to get away from the constrictions of socialism. The difference between the socialists and ourselves is that we like a free society.

Another point that I should like to mention is the extraordinary defence made by the Leader of the Opposition (Dr. Evatt) of the honorable member for Hindmarsh when he had been sadly knocked about in the debate. He was being dogmatic on the question of the issue of import licences. He said that the method should not be flexible. He was basing his line of thought on that of trade union thinking on demarcation issues. I emphasize that the method of import licensing must have some flexibility. 1 now wish to speak about primary production and at the outset, if 1 may refer again to socialist thinking and socialist propaganda, I direct attention to a remark in a question asked a few days ago by the honorable member for Lalor (Mr. Pollard). I am sorry that he has left the chamber. He said in a question to the Minister for Primary Industry (Mr. McMahon) that the profit made by the Nor’-west Whaling Company Limited - the old whaling trouble again - was ?400,000, and he proceeded to make the point that the company had purchased the assets of the Australian Whaling Commission for only ?880,000. That is the sort of propaganda, the sort of misleading statement, that constantly comes from the Opposition. Let us examine the profit of ?400,000.

The first point I make is that the profit is taxable at the rate o’i lis. in the ?1 so that immediately the large sum of ?160,000 went straight into the Treasury. That left ?240,000. I cite these figures in simple terms, otherwise the honorable member for Kingsford-Smith (Mr. Curtin) may have difficulty in following them. The profit, when distributed to shareholders, is taxable in their hands. What amount of tax would be paid to the Treasury at that point? We are told times without number by Opposition members that the assets of the Australian Whaling Commission were sold to our rich friends. On a conservative figure, our rich friends would pay tax at the rate of 10s. in the ?1, so that taxation would account for a further ?120,000.

Honorable members will now see that the profit of ?400,000, which is cited to mislead the rabble, is reduced to a net profit of ?120,000. The honorable member for Lalor completely forgot that the profit was not made solely by the Australian Whaling Commission. The profit was made by the commission and the company, so that the net amount of ?120,000 which I have calculated should be divided by two. That is to say, the correct profit on the first year’s trading is ?60,000, or in other words a return of 7 per cent, on the capital. That is not an unreasonable return in a risky trading business in a good year. 1 refer to that matter in order to show how Opposition members try to mislead the people with their constant attacks on the capitalistic system. It is always the same.

When Opposition members cite misleading figures time after time there is gradually revealed to us the common front that is so strongly advocated by Dr. John Burton. The Communists have no worries about proof. We have, on these distortions of figures, the gradual approach to the common front.

No one wants to impose import restrictions. 1 feel that the Government is making strenuous efforts to increase our balance of payments by the export of manufactured goods. I believe that in time this export drive will succeed, but much will depend upon such factors as costs of production, and wages. Once better relations are established between management and labour, I believe that we shall be in a position to increase the production of our secondary industries. In the meantime, the quickest way in which to increase our exports and thereby improve our balance of payments is through the primary industries. There are many ways in which primary production can be increased.

At this juncture, I desire to suggest one way that is worthy of consideration. I believe that superphosphate should be subsidized. I do not like subsidies, but a subsidy on superphosphate is not an ordinary subsidy. I note that an Opposition member remarks somewhat sarcastically that it is in a different category because it assists the man on the land. If the honorable gentleman will listen, he may understand. I realize, of course, that he does not understand much about farming. Superphosphate, if applied to the land in the way of top-dressing of improved pastures will increase the carrying capacity at least threefold. That is to say, three sheep may be carried where one could be carried before. The application of superphosphate also increases the yield per sheep. The subsidy may be paid in one of three ways. The Commonwealth might subsidize superphosphate by paying the railage or coming to an arrangement with the State governments whereby they reduce the railage on the fertilizer and the Commonwealth pays a subsidy to them, or the Commonwealth might pay the subsidy at the actual point of production. What is the result? It means the imposition of certain strains on the Treasury, but the Treasury will recoup itself enormously in the first year from the increased collection of income tax.

That is an ordinary straightforward business proposition. The primary producer puts the superphosphate on the land, and his yield is increased. The Government gets a rake-off in the form of increased income tax. My statements in this respect can easily be proved. The State governments, if they reduce rail freights on the transport of superphosphate, will be recouped. When 1 make that statement, 1 refer to State governments other than the New South Wales Government. Indeed, the New South Wales Government will recoup itself in two ways. The first is by the receipt of the increased rail freights and the second is by an increased return from gambling. As everybody knows, the New South Wales Government derives a good deal of its revenue from gambling and poker machines. The land-owner who uses superphosphate on his property will, spend some of his increased income on lotteries and gambling, so that the New South Wales Government will get a return in two ways.

I should like the matter of the payment of a subsidy on superphosphate to be considered because 1 think that the use of this fertilizer will enable us rapidly to increase primary production. Some honorable members may say, “ That is all very well, but does not the farmer already use superphosphate as a matter of course? “ Several matters arise here. One is that the farmer is very conservative. Even in these modern times, he is so conservative that he still works hard. That is a point that Opposition members do not realize. He still believes that hard work is the ultimate solution of all our problems. But he is conservative because he lacks cash to spend on superphosphate, which is costly. That is why I ask the Government to subsidize superphosphate in order to enable farmers immediately to recoup their expenditure and to encourage them to adopt this method of farming. If that is done the production of wool, beef, and similar commodities, the output of which is improved by the application of superphosphate to the land, will increase substantially.

Another matter that I should like to mention while the Estimates for the Department of Primary Industry are under consideration is the amount of money devoted to the Commonwealth subsidy on extension services conducted by the State agriculture departments which organize field days and agricultural schools for farmers. These services are designed to modernize agricultural methods, and they are having very beneficial effects. To the consternation of those people who know something about agriculture, a recent survey in the Riverina revealed that 80 per cent, of the sheepfarmers did not cull their flocks. That is a scandalous admission in a country which claims to be fairly modern in its farming methods. All stock should be culled. I believe that enormous benefit will be reaped from the money which is being spent by the Commonwealth on extension services. I recently opened a special school in my electorate near where I live. Those who attended underwent three days of intensive study and lectures, and watched demonstrations and motion films. My conversations with the students afterwards showed that they were much impressed, and I am sure this training will have considerable results by improving production in the areas in which the students are engaged in farming. Much more of this work should be done. It can be done only if the Commonwealth subsidizes the extension services conducted by the States. There is no doubt that farmers are conservative. They have to be, because experiments which must be conducted if farming methods are to be improved do not show results for a long time, and they are too costly for farmers to finance. In addition, if farmers have not the aid of trained scientists they may suffer serious losses if they make mistakes.

I commend to the Government the wisdom of subsidizing the use of superphosphate in order to increase the production of certain commodities, and of increasing the subsidy paid to State agriculture departments for extension services.


.- I should like to deal first with the Australian Transport Advisory Council, which comes under the administrative control of the Minister for Shipping and Transport (Senator Paltridge). I am deeply disappointed at the snail-like progress being made by this body in formulating an objective approach to the roads problem, which is undoubtedly one of the greatest problems confronting Australia today. I recognize, of course, that under the Australian Constitution the Commonwealth has no power to deal directly with roads. But that is no reason why, if we cannot alter the Constitution, we should not endeavour to arrive at an agreement with the States under which we can develop a much better roads system. When we say that the Commonwealth has no power directly to control roads, we must recognize that although the responsibility for roads lies with the States, they have no power to levy customs and excise duties on petrol for the purpose of raising money to spend on roads. In other words, the position is rather confused. The authorities that are expected to control the roads do not have legislative power to raise money which could be spent entirely on road works. On the other hand, the Commonwealth, which has no control over roads, has power to raise money for the purpose of financing road works. Those who suffer from this confused situation, of course, are the Australian people.

The privilege of collecting the petrol tax rests with the Commonwealth, but it is at the present time returning to the States for road works only two-thirds of the money collected. It is universally acknowledged by all sections of the community, and, may I say, by the members of all parties in this chamber, that Australia’s roads are fast becoming a danger to human life, and a liability to industry. The roads problem has assumed national proportions, and can be dealt with only on a national basis. Not only must road authorities, whoever they are, have more money, but also there must be a national plan with a system of priorities for the roads that are to be constructed or reconstructed. As a result of the accepted feeling among all sections of the people that Australia’s roads are probably worse than those in any other civilized community, it is recognized that a national approach is needed if we are to solve the problem. It is safe to say, Mr. Temporary Chairman, that no national topic has moved to the forefront of public thinking so rapidly as the roads problem has done over the last twelve months. Every thinking Australian is now convinced that up-to-date highways are essential to a modern economy. The time is long past when it can be claimed that the various States can cope with the problem individually.

The time has arrived - as a matter of fact it arrived some years ago, and the position becomes worse with the passing of every day - when the challenge to provide Australia with an up-to-date roads system can be met only by a general agreement between the Commonwealth and the States upon the formulation of a national plan to be put into effect by a national authority, and to be nationally financed. I think this concept is universally accepted among all sections of the community which realize the tremendous impact of the cost structure on transport. I hoped that the July meeting of the Australian Transport Advisory Council would be a momentous and historic one in view of the bad condition of Australia’s roads and the universal recognition of their condition. As honorable members know, the council consists of six members of the Federal Cabinet and the six State Transport Ministers, who meet under the chairmanship of the Minister for Shipping and Transport. I hoped that, at the last meeting in July, the council would agree on action that would have deserved and received the acclamation of all sections of the Australian people. I hoped, as did many thousands of Australians, that, as the Commonwealth has not constitutional power to assume responsibility for roads, a national programme based on Commonwealth and State cooperation would be promulgated. Unfortunately, these expectations were not realized. Nothing was done to establish an authority to plan a modern roads system under national auspices. At the July meeting of the council, the various automobile associations and other interested transport organizations advanced many good and valid reasons why an entirely fresh outlook on our roads problem should be adopted. The council, after its deliberations, decided that the formation of an Australia-wide road planning board should be given serious consideration. That sounded very well, of itself, but unfortunately in the next breadth the council asked all the bodies who would seek representation on the board to submit suggestions as to sources from which funds could be raised if a national roads plan were adopted by the Commonwealth and State governments in combination. Surely the enunciation of any taxation proposal or other method of raising money, whether by the Commonwealth or a State government, is a matter for the government concerned. Once a government decides on a policy it is the duty of that government to decide by what method it will raise the money to implement its policy. But to pass the buck back to the road planning authorities by asking for ideas how the money should be raised to finance a roads plan is most deplorable.

In view of the very bad and deteriorating condition of the Australian roads system, it is not an exaggeration to say, particularly in view of the recent floods, that Australian roads have reached a state of crisis. For a country that has reached the stage of economic development of Australia, our roads system is one of the worst in the world. When one examines the road building programmes of other countries, one is astounded at the outmoded approach 10 this problem being made by the Australian people and, irrespective of the party or State, or locality to which we may belong, we should hang our heads in shame. Nothing has been done except to call conferences and, after adjourning them, to wait until the next meeting is held.

I invite honorable members to examine the method adopted by the United States of America to deal with the problem of roads. I realize that America has a greater population and a higher automobile density than Australia but, nevertheless, if Australia wants to tackle this problem efficiently, American methods should be examined in order to glean some ideas. Early this year, the American Congress declared a highway emergency which, in terms of mobilization and concentration of nations! resources, is second only to war.

The federal and state governments of the United States of America are combining in a national roads policy involving the expenditure of 33,000,000,000 dollars in the next thirteen years. Of that sum, the federal government will contribute 90 per cent, and the state governments’ 10 per cent. Whenever members of the Opposition in this chamber ask for some progress to be made in road construction and maintenance in Australia, members on the Government side greet us with a barrage of questions as to how the money can be found. I invite honorable members to consider how the huge sum proposed to be spent in the United States of America is to be raised. It will be collected from a variety of sources, and I commend to this committee, and ultimately to the Australian nation, the adoption of a policy similar to that of America. First of all, the Americans propose to devote the entire proceeds of their petrol tax to roads. The system of collection in America is different from Australia, because in that country both federal and state governments collect petrol tax. The tax varies from six cents to eight cents a gallon in the state sphere, and the federal government has increased it from two cents to three cents a gallon. A tax on diesel fuel is also collected. When the imposition of such a tax has been suggested in Australia, all sorts of arguments have been advanced from the Government side as to why it should not be imposed. If a highly civilized nation like the United States of America, which is regarded as one of the most progressive in the world, has seen fit to impose a tax on diesel fuel, surely Australia would be well advised to follow its example. The tax on diesel fuel in America varies from six to eight cents a gallon in the various states and has been increased from two cents to three cents a gallon in the federal sphere. The whole of the proceeds of petrol tax and diesel fuel tax will be applied to the new roads programme.

In order to allay the fears of my friends in the Australian Country party, 1 point out at once that the authorities in America recognize that a great deal of diesel fuel is used for purposes other than road transport. Provision has been made for diesel oil users to file a claim for a refund of tax on all diesel fuel and gasoline purchased and used for purposes other than road transport. That is a complete answer to the argument of this Government that the imposition of a tax on diesel fuel would be detrimental to primary producers. The United States of America has found an easy way to overcome that difficulty. Only a few years ago, the Dominion of New Zealand adopted this system, and it came into operation in Great Britain 25 years ago. In spite of the fact that diesel-powered trucks and cars in Australia are increasing in number almost daily, the Government resolutely refuses to tap a lucrative source of revenue which could be applied to the construction and maintenance of Australian roads. I remind the Government that diesel-powered vehicles have a very severe effect on our roads. In the United States of America, a tax on tyres is imposed also, and this is to be increased from five cents per lb. to eight cents per lb. A new tax on retreaded tyres of three cents per lb. is also being introduced.

Mr Bowden:

– Is that tax calculated on the weight of the tyre or the weight of the vehicle?


– On the weight of the tyre. A certain proportion of sales tax paid in the purchase of new trucks, buses and truck trailers is also devoted to roads. The proportion used to be 8 per cent., but now it is to be 10 per cent. This Government is oblivious to the fact that Australia is facing a road problem. The Treasury keeps the entire proceeds of sales tax paid in the purchase of trucks, buses and truck trailers. Surely it should give some consideration to the American methods.


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


.- I wish to direct my remarks to the subject of pensions. This Government has been subjected to considerable criticism by members of the Opposition because of its attitude to pensions and the amounts paid to pensioners. They have said a great deal about pensioners being better off under a Labour government, and have asked this Government to restore to the pensioner the conditions they enjoyed under a Labour administration. Some honorable members opposite have gone so far as to say that the pension rates should be increased to the equivalent of 50 per cent, of the basic wage. These are very fine sentiments, and read well when given publicity in the press, but do they represent the true opinion of the Labour party? In my humble view, a person should be judged on what he has done, and not on what he has promised to do.

With that in mind, I have traced the history of the basic wage since its inception in 1921, and of the Harvester award before that, and the relation that then existed between standard wage rates and pensions. This is what I found: The age pension was first introduced by a Liberal government in 1909. The rate then was 10s. a week, or 22 per cent, of the then award wage of 45s. 6d. It was not altered until 1916 when a Labour government increased it to 12s. 6d., or 20 per cent, of the then award wage of 63s. 6d. a week. In 1920, a Liberal government increased the pension to 15s. a week, which was 17i per cent, of the then award wage of 85s. 6d. In 1923, a Liberal government restored the pension to 20 per cent, of the basic wage, which at that time was 85s., by increasing the rate to 17s. 6d. In 1925. the same government increased the pension rate to 20s., the equivalent of 23 per cent, of the basic wage of 84s. 6d. Between 1942 and 1944 the Labour government, by a series of quarterly adjustments of 6d. increased the pension rate to 26s. 6d., equal to 28 per cent, of the basic wage of 97s. During its term of office the Labour government made three further increases which brought the pension to 42s. 6d., equivalent to 36i per cent, of the basic wage of 1 16s. Between 1949 and 1955 the Liberal Government has granted five increases, the last of which was of 10s., which brought the pension to 80s., or 33; per cent, of the basic wage of £12 a week.

The highest percentage granted under a Liberal government was 36 per cent, in 1950, and ‘ the highest percentage granted under a Labour government was 36i per cent., or thereabouts, in 1948. I am not referring to these figures in any critical way, but only to indicate that Labour professes one belief in opposition and an entirely different belief when in office. Al no time during Labour’s term of office has the rate of pension exceeded approximately 36 per cent, of the basic wage, and yet we have some members of the Opposition suggesting that the rate of pension should be increased to 50 per cent, of the basic wage. Incidentally, of the 80s. pension paid at present Liberal governments have provided 56s. 6d. and Labour governments 23s. 6d.

Pensions provide a popular means of criticizing the Government by playing on the sympathies and emotions of the public. Let us look at the present conditions governing eligibility for age pension. An aged couple may own their own home to any value, and their own furniture including refrigerator, washing machine, radiogram and even a television set. to any value, without prejudicing their eligibility to pension. They may own a motor car of any type. They may have between them insurance policies worth £1.500 and have an income of £7 a week from superannuation, yet still qualify for the full double pension of £8 a week. Is it reasonable i.i talk about increasing the general rate of pension paid to people who have no family to keep and no rent to pay? To increase the rate of pension by 10s. a week would mean that, with superannuation of £7 a week, the joint income of such a couple would become £16 a week compared with the £13 a week earned by a man on the basic wage, who might have the responsibility of bringing up a family, and would be paying rent. I know that there are quite a number of pensioners who are not in the fortunate position of owning a home and having an income apart from pension, and are therefore forced to rely on the pension. Those people should undoubtedly be helped, and for that reason I commend a scheme mentioned by the honorable member for Sturt (Mr. Wilson) in this Parliament. That scheme provides that the Government should examine the prospect of establishing a hardship pension for people who really need something over and above the general rate of pension. One honorable member mentioned a contributory scheme that was introduced in England. 1 am not in favour of that scheme, because only wage-earners, as such, are allowed to contribute to it. Indeed. I know of a person in my electorate who was not eligible to contribute under the scheme because she was a nurse and her husband was a station master, and they were therefore regarded as professional workers and not eligible to contribute to a superannuation scheme.

I do not want to traverse ground that has already been covered, because the honorable member for Sturt has on many occasions dealt with this subject, and has stressed the need for a contributory scheme for national insurance. I believe that we shall always have dissatisfaction unless a scheme of this nature is introduced.

Sitting suspended from 6 to 8 p.m.


– Prior to the suspension of the sitting I had stated that I was in favour of the complete abolition of the property means test for the reason that it destroys all incentive to save. People who save and make themselves ineligible to receive the pension under the property means test, feel that their thrift has been penalized when they see their neighbours, who received as much during their working life but wasted their substance in riotous living, collecting, as a reward, a pension from the government.

I recommend that the committee closely examine the scheme submitted many times by the honorable member . for Sturt (Mr. Wilson).

I am also in favour of completely abolishing the income means test, as I believe it also destroys the incentive to work and in that way has a highly inflationary effect. When the age pension was first introduced in 1909 a man’s expectation of life was a little over 51 years. As a matter of fact, I have had recourse to two publications, one a United Nations publication and the other an American almanac, which contained the information that the Metropolitan Lite Assurance Company of the United States in September last year reported that the average life expectancy of the American wage earner, based” on the mortality tables of insured workers, was 69.8 years. It also estimated that in a few years the life expectancy of this group would pass the biblical age of three score years and ten. In 1879-89 the life expectancy of this group was 34 years; it has been gradually climbing since. That company also reported that persons aged 65 years in 1954 had a life expectancy of another fourteen years. In 1900-02 life expectancy in the United States was 49 years, and in 1909. the year when age pensions were introduced in Australia, it was 5 1 .5 years.

Those figures prove to me that when age pensions were first introduced a man reaching the age of 65 had little, if any, of his working life left. The age pension was meant to supplement whatever meagre earnings he could make. I do not think the Government visualized then the tremendous amount of money pensions would cost in these days. To-day, many workers are capable and desirous of working after they reach the age of 65, but are prevented from doing so because of the income means test. As soon as a man receives an income greater than £7 a week the pension that either he or his wife, or both of them, is receiving is reduced accordingly. As I stated previously, this has an inflationary effect, and for that reason I believe the means test should be abolished. If the means test were to be abolished workers could work contentedly for as long as they wished, knowing they were entitled to the same reward as those of their brethren who, for various reasons, did not desire or were not able to work. As wage earners, of course, they would contribute to the social services scheme in that they would be paying income tax and thus the burden on the Government would be correspondingly reduced.

I wish to refer to one other item. Reference has been made to the fact that the pension to-day will not buy as much as it did previously. The same applies to wages. Honorable members opposite speak about the Chifley £1 almost with awe and reverence as though it was something sacred and certainly the most wonderful £1 in the history of this country. Compared with previous £l’s the Chifley £1 was highly inflationary. The £1 has been losing value ever since I can remember, and for a long while before that. I began work in 1928 on £1 a week, which was a pretty good wage. I received ls. a week as pocket money. In 1936 I was married on £5 a week, but my wife and I kept house on 30s. a week. Our gas bill amounted to 8s. and our electricity bill to 30s. a quarter. In those days I could buy a suit of clothes for £4. If we go further back, before World War I., a shave cost 3d. and a haircut cost 6d. In one hotel in Melbourne free counter lunches were given to any person who bought a packet of cigarettes for 3d. Down-and-outs were able to buy a packet of cigarettes for 3d., have their free counter lunch, sell the cigarettes and then use the same threepence for the rest of the week.

My father boasted to me that he worked for 2s. 6d. a week. To borrow an expression from the honorable member for East Sydney (Mr. Ward) I say, “So what?” What does that prove? Probably my father’s father, and his grandfather before him, could prove that they had worked for less than that. But the fact is that as the £1 has lost purchasing power the standard of living has gradually increased; and it has never been higher than it is to-day. Australians now have more motor cars, refrigerators, washing machines, radio sets, and radiograms than ever before. But one cannot live in retrospect. People in the world of sport tell us that Phar Lap was not as good as Carbine, that Bradman was not as good as Trumper, and likewise in other realms that Greta Garbo was not as good as Bernhardt and that Anthony Eden is not to be compared with Disraeli. 1 say, let us get on with the job we have to do to-day before it is too late.

On that point I should like to conclude with a quotation from Patience Strong, who wrote something which I think is particu larly applicable to this critical attitude of comparing to-day’s values with those of the past. Incidentally, I might say that honorable members opposite conveniently forget that they are getting very much more of these so-called depreciated f l’s than they were getting in the days of the Chifley £1 . Patience Strong wrote -

No secret key will open the gales of yesterday, when they have closed behind us. We have to go our way along the path that opens upon the present scene; not gazing back in longing on things that might have been. Why travel overladen with burdens of regret, with grievances and grudges? Forbear, forgive, forget. Cast oil your sins and sorrows, for peace and pardon pray, before God locks behind you the gateways of to-day.


– I was interested in what the honorable member for Henty (Mr. Fox) had to say about the amount of money he earned and the amount on which he was able to live. It made me think of some of the people who are now trying to live on the pension allowed to them by this Government. 1 repeat what I said last night. If some Government supporters, instead of being concerned about luxuries, would spend more time considering how pensioners try to exist, they would understand more clearly the difficulties that confront the stalwarts who now live in poverty, being dependent solely on the meagre social services benefits provided by this Government.

I did not rise, to-night, to speak on social services, but to discuss, briefly, the Department of Shipping and Transport, which, as it relates to our communications, is playing a tremendously important part in our economy and is also directly involved in the inflationary trend in this country. We have heard some talk in this chamber during the last few days of proposed improvements to our roads system, but we have heard nothing from this Government, since it came into office, that would indicate thru it is facing up to that problem and dealing effectively with transportation in Australia. Nor has it faced up to the problem of trans- port costs and their effect on the inflationary trend in our economy. I have paid some attention to what has been happening in respect of transport costs because I have had some experience of the great advantages that have resulted from the introduction of diesel-electric locomotion in Australian transport. Bearing in mind that feature, I thought we might expect some degree of understanding on the part of this Government. I thought the Australian Transport Advisory Council might have approached the problem of transport on a level, at any rate, in keeping with what was said this afternoon by the honorable member for Stirling (Mr. Webb). He said that if we were confronted with transport difficulties and high costs of transport we should try to solve those difficulties and lower those costs by dealing with the matter on a governmental level.

On 29th August, 1955, the Australian Transport Advisory Council held a meeting in Melbourne in order to obtain the views of certain persons and organizations about the state of our present and prospective national roads system, and about the need for better roads. I am sure that nobody will disagree with the necessity for that body to investigate the Australian transport system and the need for better roads, but in considering this matter I find myself mainly concerned at the ineptitude of this Government and its failure to approach the problem of our transport system in the way that this council dealt with matters before it. At the meeting of the Australian Transport Advisory Council a number of organizations were represented. They were the National Transport Council, the Australian Automobile Association, the Australian Road Federation Limited, the Australian Road Transport Federation, the Federal Chamber of Automotive Industries and the Australian Hauliers Federation. I suggest that one would not need to be a keen student of psychology to know the manner in which the section of our community represented by those organizations would approach transport problems. I have no doubt that those organizations would urge the need for better roads, but certainly not for the same reason that I would urge that need, because they would be serving their own selfish interests in trying to obtain better roads in Australia and would have little regard for national development and the improvement of the economy of the nation.

In any discussion about our transport system the question of costs must loom very large. If we are to spend hundreds of millions of pounds on our transport system, then this Government and every other government in the country must expend that money in such a way that it will have the best possible effect on our national economy. The meeting of the Australian Transport Advisory Council to which I have referred decided to provide some general information about the road transport system to the people generally. Last night, the Minister for the Interior (Mr. Fairhall) said that he believed that every surfaced mile of public road was one more step towards the removal of the inflationary tendencies in our economy. I disagree with that statement, and when we consider roads in relation to other forms of transport in Australia honorable members will understand why 1 disagree.

To the end of June, 1935, there were 525,000 miles of road in Australia, and of that total 40,651 miles of road were constructed of concrete or were paved and sealed. Therefore, as honorable members will perceive, almost 500,000 miles of road in this country are constructed of material other than concrete, and are not sealed. In view of those facts, how can it be said that our roads system is such that it will permit us to have economic road transport in this country? There was a time, not very long ago, when it was maintained that transport by sea was the cheapest method of carrying our goods, but to-day there is no doubt that the diesel-electrification of our railways will provide cheaper transport by rail than by sea, and will be the answer to all our transport problems. However, in order to reach that happy conclusion dieselelectrification must be properly dealt with by this Parliament.

In order to prove the point that 1 have just made, let us consider the money that has been expended on Australian roads since 1946-47. In that year £26,500,000 was expended on roads. In the succeeding years the amounts spent were as follows: -

Despite that vast expenditure, not one honorable member in this chamber will say that we have an up-to-date roads system in this country to-day. In the realms of sea transport costs are still rising, and the latest figure available to me in respect of general cargo carried between Melbourne and Sydney is 134s. a ton. However, with diesel-electrification, the railways can haul goods at a cost of id. a ton mile. If there were a standard rail gauge of 4-ft. 8i-in. between Albury and Melbourne, which would mean a standard gauge between Melbourne and Sydney, diesel-electric locomotives could haul goods between the two capital cities at a cost of about 25s. a ton.

The cost of laying a new 4-ft. 8i-in. gauge line at the present time is about £35,000 a mile. Therefore, it would cost between £7,000,000 and £7,500,000 to convert to standard gauge the line between Albury and Melbourne, and after it had been completed goods could be hauled between Melbourne and Sydney for 25s. a ton as against the other cheapest form of transport, sea transport, at 134s. a ton.

That illustration will show honorable members that diesel-electrification of our railways will revolutionize transport in Australia. This form of transport will lower haulage costs and will also afford a very quick turn-round of transport vehicles. It has been said in the past that with a standard gauge line between Albury and Melbourne the additional cost of equipment would be too great for economic transport, but the fact is that if such a line were constructed a train from Sydney, instead of stopping overnight at Albury, would be able to go straight through to Melbourne, which would leave an additional unit available immediately for other operations. With diesel-electrification, goods could be taken from Sydney to Melbourne in twelve hours at a cost of about 25s. a ton. That great improvement in our transport service could be effected by laying out between £7,000,000 and £8,000,000 on the standardization of gauges between Albury and Melbourne and the diesel-electrification of the railway.

This afternoon the honorable member for Stirling made a statement to the effect that road transports could be operated between Sydney and Melbourne, thence to Port Pirie, then the lorries could be driven on to flat-topped rail trucks and hauled across the Nullabor Plains by the Commonwealth Railways, and then go on to Perth and unload. Presumably the same process would operate for the return journey. I suggest that everybody should stand aghast at what is happening to our economy if that is the way our transport system is to be conducted. The capital invested in the vehicles, the man-power used to operate the vehicles, and the money expended on running costs are all being wasted simply because there is not a standard rail gauge between Broken Hill and Port Pirie. But honorable members should remember that such a uniform system would cost only about £12,000,000 and could be laid down in about eighteen months.

The report of the Australian Transport Advisory Council indicates that during the next ten years we must consider two systems of roads - primary roads and secondary roads. The capital cost of providing primary roads during that period would be £540,000,000 and of providing secondary roads £450,000,000. The report suggests that that vast sum of money must be expended to give us good roads in Australia, but it does not take into account the cost of maintenance of our roads over the next ten years. By spending one-tenth of the sum mentioned for roads, we could link the capital cities of Australia with standard gauge railways on which we could carry goods at a cost of id. a ton a mile. That would give the economy of the country the greatest fillip possible. I am surprised that the members of the Australian Country party have not come to the fore in this matter. Rather than spend millions of pounds on highways between, say, Melbourne and Sydney, we should spend the money on the standardization of railway gauges. If we did that, haulage costs would be reduced to id. a ton a mile. Any money available for roads should be spent in country areas on the construction of feeder roads to railheads.

I put it to the Government that the time has arrived when we can no longer afford to fiddle with the transport problem. When I speak of haulage at a cost of id. a ton a mile, I speak of a reality. That is the cost of hauling goods on the Commonwealth railways by diesel-electric locomotives. The Commonwealth Railways can more than compete with road transport across the Nullabor Plain. The railway could carry the road hauliers’ trucks across the Nullabor Plain for less than it would cost the hauliers to run the trucks across under their own power. What can be done there can be done elsewhere in Australia.

We talk of spending £1,000,000,000 on roads over a period of ten years. The capital cost of railway gauge standardization in Australia would be less than £700,000,000. Spread over ten years, that would be £70,000,000 a year. With a unified gauge and diesel-electric locomotives, rail transport costs would be reduced to id. a ton a mile. Any government that fails to recognize the importance of transport does not understand the economic demands of a growing nation. Transport is essential to the development of the country. The transport of goods between the capital cities should depend, not upon road transport, the flow of which can be interrupted by floods, as occurred at Wagga recently, but upon an organized railway system, with dieselelectric locomotives hauling loads of 800 tons at speeds of not less than 50 miles an hour. Diesel-electric locomotives could haul goods from Melbourne to Sydney in less than twelve hours and from Sydney to Perth in 52 or 53 hours. Road transport could not compete with railways whose haulage costs were id. a ton a mile.

The CHAIRMAN (Mr. Adermann).Order! The honorable gentleman’s time has expired.

Minister for Territories · Curtin · LP

– The life-long enthusiasm of the honorable member for Blaxland (Mr. E. James Harrison) for railway matters made him sound more and more like an express train the further he went with his speech. 1 do not wish to differ at any point with his remarks. My purpose in rising is to say something by way of introduction to the Estimates for the Department of Territories. As honorable members are aware, the main debate on the Territories will take place at a later stage. The items in Division 116 concern only expenditure in the central Department of Territories in Canberra and Sydney. I want to make two remarks about this comparatively small expenditure.

The first item on which I want to comment is the item relating to visits to the Australian Territories by members of the

Parliament. Honorable members will recall that, some years ago, they had a travel privilege which entitled them to visit the Territories at their own will, under certain conditions. As the result of an inquiry into parliamentary privileges, that privilege was withdrawn. At that time, 1 approached the Treasury and got it to agree to a scheme under which, each year, we should send to the Territories delegations selected by both sides of the Parliament. 1 think that those tours by members of the Parliament have produced very good results. Although a recent inquiry by an independent committee has resulted in the restoration of certain travel privileges to honorable members in respect of the Territories, it is proposed that we should continue to send official delegations, year by year, to each of the two larger Territories and, occasionally, to the smaller Territories. I feel that experience has shown us that in the organized tours, lasting for two, three or four weeks, and conducted by officers of the administrations of the Territories, we are able to place before members information and opportunities to see what is being done that are more comprehensive, perhaps, than would be the case if they travelled individually under parliamentary privilege. Of course, if any honorable member exercised his parliamentary privilege to visit a Territory independently, we should do what was within our power to make facilities available to him.

The other item to which I wish to refer relates to expenditure on the Department of Territories. I want to refer to that item because there is a mistaken idea of the way in which the Territories are administered. This mistaken idea is expressed in the phrase “ remote control “. In a question that was raised earlier this session, it was suggested by one honorable member that all the strength of administration was in Canberra, and that none was in the Territories. That is quite contrary to the facts. The position is shown quite clearly by the figures. The officers of the Public Service who are working on Territory affairs in Canberra and Sydney number 188. In the Northern Territory, there are over 500 public servants working on the administration of the Territory, and in Papua and New Guinea there are about 2,200. If we fake all of the Territories - that is, the Northern Terri tory, Norfolk Island, Papua and New Guinea, Nauru and Cocos Island - the position is that something less than 200 officers are engaged on territorial affairs in Canberra and Sydney and that about 3,000 are engaged on territorial affairs in the Territories themselves. Those figures reflect exactly the sort of way in which we are trying to discharge our responsibilities, as a government, to the Territories.

There is also some misconception about the role which the Department of Territories in Canberra and Sydney plays in respect of the Territories. The officers in Canberra and Sydney do not attempt in any way to administer the Territories - that is. to carry out the task of government in the Territories. They do, however, perform certain services for all of the Territories - for example, procurement services. If the Territory of Papua and New Guinea wants orders to be placed for tractors, our officers in Sydney see the suppliers of the tractors, place the orders and attend to the shipping arrangements. If some one wants a permit to visit a territory, the application can be handled in the Sydney office. A great number of services of procurement, supply and so forth are carried out by the officers of the Department of Territories, on behalf of the various territories.

In addition, the department acts as a central secretariat on all territorial matters. It tries to bring together and prepare for presentation to the responsible Minister, to Cabinet or to this Parliament matters which affect all or any of the Australian Territories. The task of acting as a central secretariat and, while doing so. serving the Minister, as all departments do. occupies a great deal of the time of the Department of Territories.

There is a third field of service in which, I think, the officers of the Department of Territories in Canberra, particularly the more senior officers, render a great service to the Territories. They assist them to overcome their problems. To take an example, one of the larger territories - let us say, Papua and New Guinea - grappling with the problem of the preparation of its annual estimates, may require the assistance of some one skilled in financial procedures. Quite readily, the Department of Terri.tories will send men to Port Moresby to stay for a period of weeks, to sit down beside the administrative officers and help them, in a spirit of co-operation, with their particular problems. Again, if some other particular emergency arises, and the existing staff in a territory is not able on its own to grapple with that problem, a departmental officer might go to the Territory and help them with it.

I wish to insist, and to emphasize as clearly as I can, that it is not the function of the Department of Territories to govern the Territories, to administer the Territories, to run the Territories - that is something that is done by the territorial administration. In my experience of this portfolio, the Department of Territories has never presumed to go beyond its proper function and, of course, the responsibility of any Minister for Territories, no matter who he may be, is to ensure that these two units of government - the department in Canberra, and the territorial administration - run together and work together as a team, neither of them trying to supersede the other or to ride on the back of the other, but each assisting the other as opportunity arises.

I should like to take this opportunity of saying in public what I am sure every honorable member who has had an opportunity of seeing this phase of the administration will endorse. I pay a tribute to the single-mindedness and devotion of this group of public servants - as is the case with other groups of public servants - to the work in hand. I am sure that every member of this committee will agree that, in connexion with these great Territories which we administer, both on the mainland of Australia and overseas, we have a great national responsibility, and we face a very deep challenge - n challenge calling for the best that is in us as a nation. I should like to pay a tribute, on this occasion, to those officers who, selflessly, obscurely, patiently, and a! the cost of many long hours of arduous work in the Department of Territories in Australia, are helping Australia to advance its Territories, in accordance with its national responsibility.


.- I wish to say a few words in relation to the Department of Trade, particularly in regard to the import restrictions that have been imposed in recent times. Various reasons have been given by the Government for the imposition of these drastic restrictions. I think it should be pointed out that we quite agree that, at the present time, there is need for a form of import restriction, in order to prevent a further fall in our overseas balances, but this Government cannot escape its full responsibility for having to impose such drastic restrictions, which are causing trouble and hardship to both employers and employees throughout this country to-day. The Tariff Board’s report recently presented stated that, in 1951-52, £803,000,000 of overseas reserves were held by Australia. Under this Government, which has been in office for six years, our overseas balances have dwindled to £350,000,000. In real value, £350,000,000 is worth about 50 per cent, less than it would have been in 1951-52. Why have these restrictions to be imposed now, although when the Chifley Government left office our overseas balances totalled £803,000,000? This Government saw fit to lift restrictions. It made no selection whatever, and all sorts of goods came in. Goods that were of no use to the economy of the country came in by the million.

In making this comment, let me say that this is one of the responsibilities that the Minister for Trade (Mr. McEwen) must face. He will also have to face this charge: The policy of this Government, on every aspect of the economy, but particularly in respect of trade, has always been to let the balances run down to a minimum and then to impose the most drastic restrictions, which do cause great hardship. Why does not the Government make a practical approach to this matter? What has it done to increase production? What has been done to obtain additional markets for our products abroad? What has been done with the machinery that was brought here from abroad? What has this Government done in a practical way, first, towards increasing production in order to bolster the export trade, and, secondly, to find additional markets abroad?

I come now to wheat. It was not until we found that there was a glut here that Sir John Teasdale went overseas to all kinds of places trying to obtain markets. There was no thought of doing that in the early stages. I think that it is time the Government shouldered its responsibilities in this respect. There must be great markets abroad for many of Australia’s products. The Tariff Board criticized this Government’s policy on this particular issue. It said that the Government is imposing tariff barriers and restricting imports, when it should really he tackling the problem at its base. That is to say, it should be building up production and finding export markets for our exportable surplus. Only to-day. a leading American industrialist told the people of Australia that they could not expect markets to come to them; they must chase the markets that they wanted. It is nearly time that the Government considered constructive proposals towards that end.

It is all very well for members of the Australian Country party in this chamber to smile. It is obvious that they are not very concerned with the problems of the people whom they are supposed to represent. The fault for the existence of the problem that I have mentioned lies with the present Government. It is of no use for honorable members opposite to tell us that it was necessary to impose drastic import restrictions, without explaining their own incompetence at the outset.

There is an air of mystery surrounding the granting of permits for the importation of goods. I am not unduly critical of the staff concerned. They are probably burdened with thousands of genuine applications from people seeking quotas for goods they need in order to carry on their businesses, but I am concerned at the methods that are being adopted. Delays take place for a considerable time. Industry is inconvenienced unless the Government gives decisive answers at a very early date. Countless advertisements have appeared in the press from time to time offering quotas for sale at a certain percentage. Surely it was never meant that quotas issued for what are considered to be goods genuinely required by industry could be sold to other people, and surely it was never intended that the people to whom licences are issued, and who do not really need them, should be able to exploit other members of the community by selling them, and so gaining profit without doing anything to earn it. The Minister should explain to the committee and to the people of this country what he is doing to stop trafficking in import licences. I was speaking to a leading industrialist the other day, who told me that people, without the knowledge of the Minister or the department, are obtaining import licences to bring in the kind of goods that he is manufacturing. That matter must be looked into, lt is known that there have been false accounting methods used in respect of import licences over a period. I do not mean false in the sense that they are crooked, but they are not accurate; they do not indicate what is coming in or going out. All these things must undoubtedly cause great concern to the Minister, the employers, and men and women in the community generally.

I should like to say also that I think there may always have to be in this country a selective method of import control because I believe that essential goods should be imported for the use of industries thai are of benefit to this country, that create employment and are worth building up. 1 am opposed to the practice of squandering our hard-earned reserves abroad on luxury goods that this Government allowed to come into Australia in the early part of its regime. I also believe, in accordance with traditional Labour policy, that manufacturers of Australian products, Australian workmen and Australian industry are deserving of protection. Therefore, we must have some form of tariff protection and, possibly, a measure of import control. Nevertheless, because of the harsh restrictions that are imposed at present, and the air of mystery surrounding the whole administration of this section of government activity, the Minister should make a clear statement to the Parliament and the people of what he and the Government intend to do in the immediate future to relieve the situation. The Minister should tell us on what basis the department will decide whether an applicant is suffering hardship. How many applications are to-day cluttering up the department because of the great number of people who desire to obtain some form of assistance to keep their industries going?

I summarize my criticisms in this way: I charge the Government with the full responsibility for bringing about the present state of affairs, because of its incompetence and its squandering of overseas resources in the early stages of its administration. I charge, the Government with inability to increase export markets or to increase production iri this country of exportable goods. I charge the Government with failure to build up, in the various countries that must require Australian goods, a market for oar products, in order to increase our overseas reserves. Together with other members on this side of the chamber, and people outside the Parliament, 1 am not satisfied with the methods employed by the department to administer import licensing. 1 ask the Minister to tell us on what basis the department will determine hardship, how many applications are outstanding, and what the Government intends to do regarding delays that undoubtedly take place, which are due not in any way to incompetence on the part of the departmental staff, but simply to the tremendous number of applications awaiting consideration. I hope that the Minister will give us a clear statement on these matters.

I should like to make some remarks on the subject of social services, which has occupied so much of the attention of the committee. Much has been said about the Government’s record in this field. We find from the Estimates that a considerable amount of money is to be- provided for social services and for the administration of the department. Let us face up to the fact that the Government’s record in regard to social services is a very shabby one. To-day, for the first time since the Labour Government was defeated, pensioners are subject to a means test in connexion with hospital benefits, the provision of medicines, and other health services. We find that great numbers of citizens are subject to a means test, under the policy of a government which was elected on a pledge to abolish the means test. I heard the honorable member for Henty (Mr. Fox) say tonight that the pensioners’ £1 will buy more to-day than it would buy in days gone by. The purchasing power of the Australian £1 is not more than 5s. 4d., and the increases that have been granted in social services payments to pensioners are miserly. On the Minister’s own figures, the actual cash value of pensions has increased by 80 per cent., but in the same period the cost of living has increased by 100 per cent. The pensioners are therefore so much worse off.

People in all walks of life are now realizing that pensioners are bearing the full brunt of mounting inflation. People who are dependent on social services are suffering as never before. Increased costs constitute to them a tremendous burden. I admit quite frankly that I have had an increase in salary, and practically every section of industry has benefited financially. I do not see why we should consistently keep pensioners on the minimum, when every other section of society demands - and rightly so - an increased share of the available wealth in order to meet rising costs of living. There is a responsibility on the Minister and the Government to do something towards increasing the rate of pensions. Every honorable member on this side of the committee knows how necessary it is to increase the value of social services payments because of the decline in the purchasing power of our money, which has been brought about by the policy of this Government.

I am pleased to see the Minister for Social Services (Mr. Roberton) in the chamber. It is delightful to have four Ministers here when these matters are being discussed, because very often we find that only one is present. A number of matters concerning the Department of Social Services and the Department of Trade require clear statements from the Ministers concerned. The people will require a statement as to why social services recipients are being kept on minimum rates, while all other sections of society have received substantial financial benefits. For my part, I am opposed to the policy of making pensioners contribute fully towards curbing inflationary trends. I believe that those who have power and influence can well make a greater contribution, if necessary by increased taxes, towards easing the burden of pensioners and other recipients of social services benefits.

I submit these constructive suggestions to the Minister. I am not at all optimistic that my appeal will soften his hard heart. But I say, in all sincerity, that there is an obligation on his Government and its supporters to do justice to the people whom they promised to assist. Instead of repudiating that promise as they have been doing in recent years, they should honour it now, even at this late stage. I have made my appeal, and I ask for answers on the matters that I have raised concerning the Department of Trade and the Department of Social Services. I hope that the Government will realize the mess that it is getting the country into, and that it will do something about it without further delay.

Minister for Trade · Murray · CP

– I told the Leader of the Opposition (Dr. Evatt) earlier that I would be prepared to make some observations in this chamber before the debate on the Estimates of the present group of departments had concluded, on the administration of import licensing with particular reference to what is known as trafficking in licences. I think that, in order to put the matter in its proper setting, it is necessary for me, first, to make some general observations on the whole circumstances surrounding import licensing. The honorable member for Grayndler (Mr. Daly) has charged the Government with responsibility for the necessity for import licensing.

Mr Curtin:

– Of course the Government is responsible.


– I think that is right. 1 think it is, and I am proud of it - not of import licensing, but of the circumstances that have produced the necessity for it, because they are circumstances of unprecedented prosperity and confidence in the whole of the Australian community. It i3 only this situation of unprecedented prosperity, shared by the whole of the Australian community, that has produced the pressure, by people who have the capacity to pay, for imported goods. These people are exerting pressure because of their desire to expend the earnings that they have made in the present prosperous circumstances, whether they be from wages, salaries, businesses or from farming. They have endeavoured to spend a considerable portion of these earnings on imported goods. For instance, one of the factors that have produced the necessity for import licensing is the importation of 250,000 motor cars last year. Does the Labour party condemn the development of an economic situation which enables Australians to buy 250.000 motor cars in one year?

Not only does this situation of unparalleled prosperity exist to-day. but such is the confidence of the whole Australian community, including the business world, the farming community, State governments, municipalities and people who work for wages, that all are ready not only to spend their current earnings but also to pledge their earnings for subsequent years in order to borrow for the purpose of developing the country or of improving living standards.

Surely this is a situation that we have all aimed to achieve, lt is a wry paradox thai the very advent of this magnificent situation, which none of us would have dreamt five years ago was capable of being achieved, has brought with it the problem that now confronts us. The problem is one of a country, prosperous in its own land, developing at a tempo hitherto undreamed of. and in the course of development requiring imports, and finding itself unable to service this desired spending in overseas currency. The present -rate of importation has been exceeded only three times before in our history. One of these occasions was the year of the extraordinary wool boom, and the other two were in the subsequent years. We have import licensing of a rigidity that troubles a great many people - myself as much as most - but what we describe as rigid restriction of imports is, in fact, regulation of imports at an extraordinarily high level.

Our export earnings are also at an extraordinarily high level. I have claimed in this Parliament, and many times outside of it, that they are £100,000,000 a year more than they would have been but for the policy sponsored by this Government in the field of agriculture and pastoral activity and, in co-operation with the State governments, set in motion in 1952. As a result of the maturing of these plans, we are now earning this vastly greater sum annually. Our high rate of export earning is supplemented by a certain amount of overseas borrowing. This, for the purpose of extending our capacity to spend money on imported goods, is further supplemented by the high level of overseas investment in the private sector. This investment, running at between £80,000,000 and £100,000,000 a year, is added to our overseas funds and is, in due course, spent on imports. In addition, there is behind these current yearbyyear earnings a reserve fund which at the present time amounts to substantially more than £300,000,000. It acts as a cushion, and supplements our year-by-year export earnings. These are the figures of a prosperous, dynamic, expanding country which is developing in the public and private sectors. They are the figures of a community expressing its prosperity and confidence in the future through the indicator of imports on a scale never before known in this country, and seldom known in any other country in similar circumstances. That is the circumstance which has produced this situation, in which the imports desired by Australians outstrip their resources in overseas currency.

It is a simple fact that while, in my judgment and in the judgment of the Government also, it would be good business to supplement our overseas funds by a fairly substantial borrowing programme - and this after all, is normal business practice in a dynamic and expanding enterprise - the United Kingdom, our historic supplier of capital, has been, financially, tremendously drained by two great wars, and is no longer able to contribute to our capital requirements as before. The great and wealthy United States of America is, for reasons that I do not at this point criticize, unwilling or unable to provide for us the opportunity to earn in its currency the great volume of dollars that ought to go with sound borrowing in that area. We cannot, therefore, with confidence borrow substantially in dollars.

These are the elementary facts of the situation. What can be done about them by the Labour party or any one else? This sort of thing has occurred in other countries. It occurred in recent years in Brazil. That country was importing, as we are, at a heavy rate, but one day the Brazilian Government and the central bank had to say, “We are sorry, but we cannot pay for the things that we have imported or ordered. We will pay you as soon as we can, but we cannot pay you now “. We are not going to get into that situation. I do not believe that any honorable member would regard it as responsible government to allow Australia to drift into that situation. We are certainly not going to reach a stage where, through the fault of the Government, there will be doubt as to the holding of the exchange rate. In the circumstances, the only prudent course is to limit the drain upon our overseas earnings and reserves. That is why import licensing has been introduced. It is operated, for reasons that are implicit in what I have been saying, with a considerable degree of rigidity, but that rigidity is not expected to be permanent.

Much thought has been given to import licensing, but ten times as much has been given to means by which we can escape from it at an early date. The export drive and many other effects are an expression of our thinking in that regard. In the meantime, by limiting our expenditure, we are ensuring that we do not exhaust our overseas reserves. We are prepared to vary, and we do in practice vary, the rigidity of that limit as circumstances permit. As the price of wool - our greatest export earner - goes up or down, and as the rate of overseas investment rises or falls, so too, while there is at any one day a rigidity in our import licensing, there is at all times flexibility as to the amount of overseas funds that we are prepared to commit” through our licensing system.

The broad approach to import licensing has been to say that there are certain things which, for the well-being of this country, we must have in the quantities required. There is no need for me to describe them. They are the essentials of every-day life and industry and take in such things as tea, petrol, essential machinery, chemicals, rubber and the multitude of commodities that are essential to the modern community. These things come into the country to the extent that demand for them exists. They are regulated through import licensing for two purposes only. The first is to keep a record of the commitment that is entered into by Australia, and the second is to ensure that our import rate matches our usage and will not result in unjustified stocks being built up in this country. These items are imported, literally without restriction, under a subdivision of what is known as the administration section of the import budget.

Another group of slightly less essential items, is brought in under category A. I know that nothing is regarded as nonessential in a modern community. Honorable members will agree, however, that certain goods may be regarded as being less essential than others. I refer to everything from imported clothing, at the more essential end. down to exotic foodstuffs at the other end. These are category B items and the entitlement to import them is expressed by mean* of licences from quarter to quarter. Entitlement is based broadly on the fact that either the claimant has an old, established business or an essential usage, or an historic pattern of importation in these items built up over the years. I think I can say that 1 have heard no criticism of import licensing except as it affects category B items. Here we have the problem of the ordinary retail business, the department store, and the manufacturing establishment, all of which depend greatly upon category B items, which include paper and textiles. Sometimes the actual users of these things, the manufacturers, have never been importers. They depend for their supplies entirely upon those who hold a quota and exercise rights under import licences from quarter to quarter. To be quite frank, when import licensing first became necessary we had the high hope, which all would expect us to have, that it would not be of long duration. In the very nature of things, it extends over the entire range of Australian living, business activity and manufacturing, and to administer this terrifically extensive and complex activity requires very many men. I am confident that every one will agree that the Government should not have instantly built up a tremendously extensive permanent administrative structure to meet a phenomenon that it was hoped would pass quite quickly.

Now, as it shows evidence of being with us rather longer than we hoped - and, believe me, we shall get rid of it just as speedily as we can - steps are being taken to strengthen the administration of import licensing. When 1 tell the committee that there are constantly operating over 700,000 licences, covering perhaps several million items, honorable members will appreciate that it would be expecting too much to hope for complete perfection in every aspect of its administration. However, I will aim constantly at the best that can be done in the circumstances and will be prepared at all times to be guided by the experience of others and to amend what is being done if it can be demonstrated that amendment is justified. The department’s current daily rate of inward correspondence in connexion with this matter is a regular 700 communications.

Mr Ward:

– Which shows what a mess the Minister has made of it.


– It makes it obvious that some little delay is inescapable; but we are quickly overtaking the back-log of unresolved issues in this connexion.

Mr Curtin:

– And it is about time.


– Order! The honorable member for Kingsford-Smith will please remain silent.


– Because of its huge dimensions, there is a nationwide interest in this whole dilemma associated with import licensing. This is the first occasion upon which I have attempted to give a fairly comprehensive explanation to the committee of the dimensions of this problem as I see it, and I had hoped that the members of the Labour party would have allowed the listening public the opportunity to hear, without continual interruption, what the responsible Minister is trying to outline. It seems to me that what I have already said in explanation of the necessity for import licensing and of what is being done about it, and the Government’s policy approach to it, is so unpalatable to honorable members opposite that they are endeavouring by a mass of interjections and constant interruption to spoil the reception for the interested listening public of what I am trying to describe. It would be much more to the credit of the Labour party if its members were a little more reticent so that the interested listening public might hear what I have to say. It would be more to their credit if they did not engage in this gross, deliberate and constant interruption which is designed to prevent the people’s obtaining a clear understanding of the position.


– Order! During the day I have heard repeated requests from the Opposition to the Minister to make a statement. Since he began speaking, I have heard nothing but interruptions from members of the Opposition, and I ask them to remain silent.

Dr Evatt:

– Will the Minister deal with trafficking?


– The Leader of the Opposition (Dr. Evatt) has asked me to refer to trafficking. If he can control his enthusiastic followers, perhaps T shall be able to get along a little better.

Mr Curtin:

– Take an Aspro.


– I have expressed concern about the fact that there is what may be termed trafficking in licences, lt has been my lot for some years to administer various departments in which permits are issued and it has been my policy always to endeavour to ensure that any pieces of paper issued by me, or on my authority, in the form of permits, could not be sold for profit. So far as I am able to control the situation, no one will be able to sell for profit any document issued under my jurisdiction as Minister.

Mr Ward:

– They are selling them every day. They are advertising them for sale.


– The honorable member for East Sydney (Mr. Ward) says they are selling them every day, but he has never stood up in this chamber or written to me pointing to one case of which he has knowledge.

Mr Ward:

– What would be the use?


– That is completely typical of the general allegations that are made in this Parliament for sheer political smearing purposes.

Mr Ward:

– They are advertised every day in the press.

Mr Haylen:

– They are advertised in the “ Herald “. Every day we see the advertisement, “ For sale, B class category licences “.

Mr Webb:

– That stunned the Minister.


– Order! If the honorable member for Stirling (Mr. Webb) wants to go outside the chamber, he is going the right way about it.


– What I am trying to say is in answer to an invitation by the Leader of the Opposition, and I intend to lake advantage of the Standing Orders which permit me to speak for as long as 1 wish during this debate. The more members of the Labour party interrupt me, the less time they will have to participate in the debate. They alone will be responsible for that. Furthermore, 1 will not be pushed around by honorable members opposite.

Mr Curtin:

– Do not get upset.

Mr Ward:

– I do not think he has got anything to say.


– The phrase, “Trafficking in licences “, is used in a general sense and not with any common interpretation. I should imagine that it would mean, in its most sinister sense, the sale by one person to another of a right to import. In my view, such action is completely indefensible, and whenever such a case is brought to my notice, I will cancel the quota. In recent times, 100 quotas have been cancelled in Sydney alone. When I say “ recent “, I do not mean during the last few weeks; I go back to the administration of the department prior to my being placed in charge of it. 1 repeat that, in Sydney alone, more than 100 licences - the figure is, perhaps, nearer 150 - have been cancelled because of the sale of rights to import. There is no defence for selling a right to import.

On the other hand, there is a borderline which, I do not hesitate to admit, is difficult to define. The business of importing has, historically, a variety of forms. For instance, there is the simple case of the persons or companies who import for their own use. Then there is the importer who buys, who assumes all the risks of importation, and then looks for some one to buy the goods after they are landed and are in his possession. But there is also the importer who conducts something more in the nature of an indent business. That is valid in the eyes of all the business community and has never been condemned by any political organization in this country. That type of importer does not involve himself in the act of import until he has achieved the certainty of a final transaction by bringing together the overseas seller and the intending and committed local purchaser. In my language, he could be described, to some extent, as an agent, but he is a very valid element in the business community.

Because it is a well established business of importing, quotas are held by such people. The impact of import licensing on some businesses of that character has been such as to diminish quite drastically the volume of business that they can do. 1 should think that where the volume of business has been arbitrarily curtailed, it is completely normal for an attempt, capable of being translated into action quite easily these days, to be made to charge a higher fee, if fee is the correct description, for the services performed. That is about as natural a thing in business and in human life as ever occurs. So we have a situation in which some one, who previously performed a service for, say, a 10 per cent, or a 15 per cent, profit expectation - if 1 may use some illustrative figures - now, out of a circumstance of curtailment of overall activities and a clamant demand from others for goods that he is able to import, feels the need to charge a higher rate.

I do not say that the claim for a higher level of profit by some people who find themselves in this situation should be condemned in principle, described as sinister or regarded as trafficking. 1 rather feel that some people who find themselves called upon to pay a rather higher charge for the service are loosely describing this activity as trafficking in import licences. In my judgment, it is nothing of the kind. The people involved are human beings, and there is a variant between the person who raises his charge from a traditional 10 per cent, or 15 per cent, to 25 per cent, and a person who raises it to 75 per cent, or, if he can screw it out of some one, to 100 per cent. That is the range of things. The test that 1 apply is not a test of a refined judgment on the last single per cent, of profit that a person should be entitled to levy. But where a clearly unconscionable exploitation has occurred by reason of the holding of an import licence, then as 1 have said publicly, 1 am prepared to take the responsibility of cancelling the quota and putting an end to those activities.

Mr Ward:

– What percentage is right?


– The honorable member for East Sydney has made a not unreasonable request - and that is unusual for him. His interjection shows that he has never had anything to do with business. The legitimate rate of profit in business has an almost infinite variety because of the combination of circumstances of business. All I want to say is that it is enough for the Australian trading community to carry the inconvenience of import licensing without having added to it an arbitrary price control component. The Minister or the Department of Trade should not sit over every transaction and before the licence is issued ask, “ What profit do you intend to make? “ or say, “ If you charge more than the Minister or the department dealing with 700,000 licences regards as valid, then you will not be given the licence “. I will not do that. It would be the final millstone around the neck of the Australian trading community.

The Australian trading community is well able, within reasonable limits, to look after itself, lt is sufficient for me to say that where a flagrant abuse of the right bestowed upon a person by the issue of an import licence has been detected, 1 am prepared to go to the extreme of cancelling the licence. But I say quite openly that, in the tremendous complexity and magnitude of this administration, I will not have anything to do with applying a refined judgment on whether a charge should be 15 per cent, or 17± per cent. 1 do not believe that the business community would wish me to do so.

It may be some comfort to the committee, which, quite correctly, is troubled by the possibilities of this situation, to know that the Department of Trade has been advised by representatives of retailers’ associations, chambers of commerce and the like, which are so vitally interested, that they regard the actual volume of trafficking in licences as being literally insignificant. That is not my opinion. Nothing has been drawn to my attention as the ministerial head of this department that is in conflict with that opinion. I am giving to the committee the considered opinion of retailers’ associations, chambers of commerce and importers generally that the dimensions of trafficking are really insignificant.

So far as the department and my own policies are concerned, every possible step has been taken, is being taken and will continue to be taken to minimize the opportunities for trafficking and to stamp it out where it is discovered. For instance, from 1st July last a step has been taken which, for reasons that I comprehend, has incurred a great deal of criticism from certain quarters. It was deliberately taken. It was this: The B category items are at the end of essentiality; they are, shall I say, the least essential. Although they include many items that are highly essential, they embrace most of the items that, by any test that could be applied, must be regarded as non-essential. In the earlier simplicity of import licensing, the Government did not wish to tell a departmental store what it could or could not import, and a B class licence entitled the holder to use his own judgment on what he imported within that category.

Mr Clyde Cameron:

– Even if it could be produced here?


– Yes; in the earlier stages, even if it could be produced here. The Government said very plainly that import licensing was not to be a substitute for the Tariff Board system in the protection of Australian industry. If it were, of course the protection of Australian industry would be decided, not as the result of an open inquiry by an impartial and skilled tribunal, but by some departmental official. 1 hope the Parliament would never want that transformation to take place and I am sure that industry would never desire that its protection should be at the whim of a departmental official who, in the nature of things, dealing with 700,000 licences, would not always be a senior and experienced official.

There is no mystery about what happened when importers of B category goods were permitted full choice of selection. People who obtained a B class licence through a history of importing a complexity of fairly essential and non-essential items, tended to import the goods that carried the greatest profit. That is normal enough. To that extent, there was neglect to import some of the important things, particularly in the textile field, that perhaps did not carry so high a profit prospect. This led progressively to some shortages in those less profitable fields, and provided an opportunity for trafficking in the items imported. In that connexion, I use the word “ trafficking “ in its widest and less sinister sense.

As from 1st July last, B category items have been subdivided into seven subdivisions or sub-categories, so that, for example, exotic foods are in one category and textiles in another. A person who obtained a licence in B category because he needed to import textiles cannot now import potted shrimps to the neglect of textiles, or make an arrangement with somebody else to import potted shrimps or caviar, or something else without which we can survive. That is good for the textile industry, particularly for the maker-up section, but I recognize it is an added inconvenience to other quite valid entrepreneurs in the business field. I should imagine that, probably, it would cause inconvenience to big department stores and organizations of that sort.

That arrangement was made out of a considered judgment that it was desirable. Now that it has been done, criticisms are being received. The representatives of the Associated Chambers of Commerce came to Canberra to see me recently to point out how bad this was. They asked me to abandon the subdivision of the B category. I said bluntly that I would not revert to a situation in which the important textile manufacturing industry could live only on the chance that people would import textiles and not use their quota to import some exotic food or something of that sort. 1 said, however, that I was open to be persuaded if it could be shown that seven subdivisions were too many, and that four or five would be sufficient. I believe that the maintenance of this system of subcategories of B category places a tremendous barrier in the way of what is loosely termed - and not in a sinister manner - trafficking in licences.

That, broadly, is the background to import licensing. It is, broadly, an explanation of the policy considerations that are behind the system of import licensing. It is a clear-cut declaration that, so far as this Government and my administration are concerned, we will not tolerate, for one moment, a situation in which a piece of paper issued by the Government can simply be sold to somebody else for profit. Where it can be discovered that that is being done, the quota will be cancelled. I invite those who believe they can expose any such transaction to communicate details to me, and I give an undertaking that they will be thoroughly studied.

East Sydney

.- In a debate of this description, the Minister has the great advantage of unlimited time, whereas a speaker from the Opposition side who is replying to him is limited to fifteen minutes. The Minister for Trade (Mr. McEwen) promised the Leader of the Opposition (Dr. Evatt) that he would make a statement dealing with the many allegations coming from many honorable members and from outside of trafficking in import licences. What we have had from the Minister is not a prepared statement, but a long, wordy speech and nothing else. He has not dealt specifically with the allegations that have been made against the administration of the Department of Trade.

The Minister has made some amazing statements. What he said, in effect, was that if any honorable member had any matter at all containing evidence of trafficking in import licences, he should take at to the Minister, and it would be attended :to. Of course, it will be attended to - in the way that an anti-Labour government always attends to matters of this description.

One would imagine that nobody had ever throught to notice evidence of trafficking in import licences. I well recollect when import .licensing was first introduced by this Government around 1952 and 1953. Specific evidence was placed before this Parliament of a form of malpractice about which this Government did nothing because one of the bigger business concerns happened to be involved. Anybody who cares to peruse the “ Hansard “ reports will find that it was made evident that David Jones Limited had been given a tip-off by somebody in the know. I do not know whether it was a member or a supporter of the Government, somebody associated with the Parliament or with the department concerned, but David Jones Limited had been tipped off that import restrictions were to be imposed. Honorable members will recollect clearly that one of the conditions laid down by the Government at the time was that it would recognize any transactions into which importers had entered, provided those transactions had taken place prior to a certain date. It is rather strange that David Jones Limited was able - according to the Prime Minister (Mr. Menzies) it was only a display of business acumen on the part of the firm - to arrange for letters of credit for the importation of goods into Australia valued at an amount running into seven figures. Other people in the same line of business who did not display, according to the Prime Minister, the same business acumen, had not been able to make such arrangements.

I remember clearly when we charged the Prime Minister in this Parliament with knowing something about this transaction. After considerable discussion, we were able to get from the Prime Minister an admission that, only a day or so previously, David Jones Limited had written him a letter which he had not disclosed in earlier discussion in this chamber. The letter showed definitely that the Government had been endeavouring to cover up the prior information which had been passed on to David Jones Limited.

Evidently that firm is still in the know. It has the inside running, because I am able to tell the Minister for Trade, if he wants to examine some of the things that are being said in various cities, and particularly in Sydney, that David Jones Limited has been canvassing some of the bigger importing houses and offering them a premium of 25 per cent, if they will import exclusively for David Jones Limited. One of the big importers approached by David Jones Limited is W. Brash MacArthur Limited. That organization was offered 25 per cent, above the import licences value if it would import exclusively for David Jones Limited. Yet the Minister for Trade has said that he wants some evidence.

Let us consider the statement that has been made by the Minister. Evidently, he does not think that 25 per cent, is too much to charge for a piece of paper that was issued to somebody else, because he said there might be some cases where 100 per cent, above the value of the permit was being asked. He does not regard that as being anything more than normal business practice.

Mr McEwen:

– That is false. I did not say anything of the sort.


– That is what the Minister said. Let us examine what that means to the people. The Minister has been speaking about our overseas trade difficulties, and they are serious. One of the greatest difficulties confronting our export industries is inflation in Australia. Does the Minister know who pays for the additional charge that is paid to some persons, merely upon the issue of a piece of paper by a government department? Does the Minister imagine that it is not passed on, in the form of prices, to the purchasers of goods? Does the Minister believe that this trafficking, and the additional profit that is available to some persons merely because they had the good fortune to obtain a licence, is legitimate business? We all know that it is adding to the inflationary spiral and increasing prices in Australia. I should like the Minister to give the committee a little more information about what he believes to be trafficking. He said that if we could produce evidence of a case in which somebody had been issued with a licence and was trading it, or selling it for profit, he would take action. I ask the Minister to have a look at the columns of the daily press. If he does so, he will find advertisement after advertisement for import licences. Does he regard that as legitimate business practice? 1 am quite certain that it would not be so regarded by any reasonable member of the Australian community.

The Minister said that he was proud of the Government’s achievement in regard to import restrictions. Having said that he was proud to have been given the opportunity to impose the restrictions, he went on to assure the Australian public that the restrictions were not to be a permanent feature of our economy. Why, if the Minister is proud of them, does he not want them to be a permanent feature of the Australian economy? As a matter of fact, under this Government they have become a permanent feature of the Australian economy, and far from approaching the point at which they are to be completely eliminated, I venture the opinion that, judging by what David Jones Limited is doing in trying to buy up import licences, import licensing is to become much more drastic in the future than it has to date, and that import restrictions will remain permanently.

Let us examine the situation. The Government has imposed an import licensing system to correct our adverse overseas trading position; but what has been achieved? In July and August, the first two months of this financial year, the trade balance was down to the extent of £10.000,000. That does not take into account the cost of freight and insurance premiums. If we add those invisibles to the £ 1 0,000,000 by which we were on the wrong side of the ledger, it means that, in the first two months of this financial year, we were £25,000,000 on the wrong side. If that is the position, why should the Minister go on pretending to the Australian public that there is some possibility in the near future of a relaxation of the import restrictions imposed by this Government, and that we are approaching the time when they may be completely eliminated? The Minister knows that that is distinctly untrue and that he has no right to make such a statement.

Now let us examine the position of the Australian Country party in relation to this matter. The supporters of that party ought to be interested in this position, because one of the factors which is tending to restrict our opportunities on overseas markets is the internal inflation. Whilst the prices for overseas export commodities are falling in almost every instance, prices in this country are continuing to rise. According to the Minister, the only things that ought to be controlled in Australia are the wages of the workers in industry. But wages are only one element of the price structure. The Minister had a useless trip overseas recently looking for markets for Australian products. It was an absolute waste of time, as well as a waste of Commonwealth money. When he returned to this country what did he bring us? Before he left, he said that he would talk firmly to the British authorities and tell them about the kind of trading agreement that Australia wanted, and that no longer were the trading agreements between Great Britain and Australia to be weighed in favour of the United Kingdom. We can only judge by results. When the Minister returned to this country, all he said was that the British authorities now knew our point of view. Fancy sending a Minister to see people on the other side of the world, at great public cost, only to learn when he comes back is that they now understand our point of view! The British Board of Trade is now considering the argument - if it was an argument - advanced by the Australian authorities.

I suggest, as I have previously, that members of this Government do not need an excuse to go overseas. They seize upon any pretext at all. In my opinion, there are occasions when overseas visits by Ministers are desirable and of great value to this country; but since this Government has been in office its members have grabbed at any pretext to go abroad. They even have a roster. They know whose turn it is to go overseas next at the public expense. They do not arrange these visits because there is a real purpose for going overseas. If the Ministers wanted to let the British Board of Trade know something about our point of view, why did not he write a letter and state our views?

It is true that we have a serious trading problem, but this Government will not correct the position by the methods it is employing. The Minister’s colleague, the Treasurer (Sir Arthur Fadden), made it clear in his budget speech recently, that if import restrictions were retained for any length of time at their present intensity they would have a serious effect on the Australian economy; and so they will. The Minister knows that, as supporters of the Australian Labour party have been pointing out, while important Australian industries are languishing and being forced to reduce the number of their employees, a lot of rubbishing goods are being brought into this country. Better quality goods could well be manufactured by Australian industries. Because the Government wants to operate import licensing on a percentage basis, we find that cheaply produced Japanese goods, particularly toys, have been imported and have helped to destroy an industry that was giving employment to many Australian ex-servicemen. Although importers are allowed to bring in cheap junk and toys from Japan, important Australian industries, such as one in Devonshire-street, Surry Hills, which manufactures chemical apparatus required by many government instrumentalities, including the Commonwealth Scientific and Industrial Research Organization, cannot get an import licence for the materials they require. Although government instrumentalities supported, by letter, that manufacturer’s request for an import quota, it was turned down because it was argued that if he wanted to import those goods it would have to be done through existing importers. Yet, this responsible manufacturer was unable to obtain his requirements on the Australian market!

It does not matter in which direction we look, we see evidence of how this Government has bungled import restrictions. Not every small businessman or manufacturer has prospered as a result of this Government’s policy. Many small concerns have been destroyed by the import restrictions imposed by the Government. The big business concerns, however, to whose advantage it is to destroy the small businesses, do nol worry about import licensing restrictions because, at an enormous profit to themselves, they are able to buy up licences from people who can make no use of them.


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


– Not being an expert in import licensing, 1 ask leave to take the debate from trafficking in import licences to traffic and transport. I am sure that all of us agree with what the Minister for Trade (Mr. McEwen) said about the prosperity of Australia, but, at the same time, I think we all appreciate that there are, to-day, certain diseases of the body politic which, if not cured, will probably have a very bad effect on that prosperous condition. One of those diseases is the existing chaos in our transport systems. I listened with very great interest to the honorable member for Blaxland (Mr. E. James Harrison). He has been connected with railways for a long time, and I do not doubt his figures, but, at the same time, I think he over-simplified the problem by saying that diesel-electric traction will solve all the transport problems that we have at our door to-day. When I was Minister for Transport in Victoria, in conjunction with the then federal Minister for Transport - strange as it may seem, the honorable member for East Sydney (Mr. Ward) - we were able to inaugurate diesel-electric traction in Australia. To give him his due, the grand old man of transport, Sir Harold Clapp, was the trigger that fired the enthusiasm among our railway people for that type of transport by asking me one day, “ Why do you not buy diesel-electrics? “ However important diesel-electrics are, the transport problem itself is very much more important, because already it is having a very bad effect on our economic stability to-day. One has only to look at the budget and read that the farming community’s income has fallen by 10 per cent., and then look at the increases in freights and fares, to realize that the farming community is taking a fall in the standard of living, while in the secondary industries the standards are being maintained, or even raised in some respects. Yet we rely on the farming community to rectify the balance of trade in our imports and exports.

Although a great deal has been said in this chamber with regard to many aspects of our economic stability, very little has been said by very few on this major question of transport and transport costs. I think the reason for this is that, in the States, transport finance looms largely in every State budget, but in the federal sphere, where only civil aviation, the Commonwealth railways and shipping have to be considered, transport, as a matter of finance, does not loom largely in our budget, and, therefore, we are inclined to overlook it. We live here in the ACT. and, therefore, we recognize those problems that are at our front door. On the other hand, it would be much better if we paid very much more attention to the A.T.C., or Australia’s transport crisis. I would recommend, to those honorable members who are interested, two volumes, one which is obtainable in the Library, entitled “ Australia’s Transport Crisis “, which is a series of addresses given by transport experts at the twenty-second Summer School of the Institute of Political Science in Canberra, in January of this year, and the other the Australian Transport Advisory Council’s publication in October of last year, entitled, “ The Costs of Transport Operation in Australia “. In the first publication, Dr. H. F. Bell, economist to the Australian Mutual Provident Society, pointed out that, up to the present, there is a considerable dispute about which form of transport is responsible for our transport difficulties. He went on to say -

This state of affairs is getting us nowhere; indeed, it is only serving to demoralize those who provide transport facilities and those who use them. There is no problem in Australia which is so obviously crying out for consideration on a truly national basis. Other countries are far from satisfied with their transport systems. Most are much better placed than Australia to provide economic and adequate transport. But whether they start from a position better or worse than our own they differ from us in this important regard that at least they have a national plan of transport.

That is one of the fundamental weaknesses of our problem; there is no national plan for transport. As a matter of fact, if I remember rightly, as a result of my experience in the State sphere, I moved a resolution which lead to this report. Unfortunately, as I said before, the Department of Shipping and Transport lost its best transport brains rather early in the life of this Government owing to what I would call internecine strife and jealousies within the department itself, when Sir Harold Clapp’s backroom boys, who were experts in transport and knew, I think, more about the overall problems of transport in Australia than did anybody else, were dismissed, and the standardization of railway gauges, and transport problems as a whole, were handed over to the direction of the Commonwealth Railways Commissioner. I think that the department has been trying, to make good that loss ever since.

However, in this publication, which brought the earlier one up to date, there are some very interesting figures, but not as. up to date as are those of the honorablemember for Blaxland on diesel electrictraction. These figures show the operatingcosts a ton-mile of the various formsof transport in 1953-54. I have not been able to get accurate figures brought up todate, but by and large these figures can be taken as relating, proportionately, to the present day, with the exception of the revolutionizing of railway transport which has taken place as a result of diesel traction. The operating costs of shipping transport a ton-mile were 8d.; of rail transport, 4.17d.; of road transport, 12.82d.; and of air transport, 46.14d. In other words, shipping is the cheapest form of transport, rail is the next cheapest, and road is three timesas expensive, and air almost twelve timesas expensive as rail.

Mr Whitlam:

– Those are the amountsthat are paid by the user. In addition tothose, there is the cost paid by the community.


– 1 was about to go into that. If one reads further in that report, one finds that in the year 1953-54 shipping, although it carried 50 per cent, of the freight traffic, was subsidized by thecommunity only to the extent of £2,000,000, an almost negligible amount, but that did1 not take into account the fact that the Commonwealth Government subsidized the shipbuilding industry in respect of shipsbuilt in Australia to the extent of 25 per cent., and subsidizes it now, I think, to the extent of 33 per cent. Therefore, there are other hidden costs involved, but by and large these figures give the general’ picture. Rail transport was subsidized by £23,500,000, and road transport by twicethat amount, - without taking into account the hidden subsidies, such as not payingfor fences, like the railways do, and not paying for traffic lights and other things. I am not against road transport, becauseevery form of transport has its own particular sphere, but nobody has so far attempted to define that sphere. Air transport was subsidized to the extent of eleven times as much as rail transport. I have not been able to get the complete figures, but working just on operating costs alone I think we subsidize air transport to the extent of at least 30s. for every passenger who steps aboard an aircraft.

Going a little further, one realizes that civil aviation is a federal responsibility, and looking at the budget, one finds that the Department of Civil Aviation will spend from revenue £5,657,000 on aerodromes and capital works and services in this financial year. The Commonwealth railways will spend from revenue £3,425,000. But the State railways and the State harbour boards have to provide all their capital works and services from loan moneys, on which they have to pay interest and in respect of which they have to provide sinking funds. One sees further that the loan indebtedness of the Commonwealth railways, as a result of this policy, is decreasing every year, while the loan indebtedness, and therefore the interest and sinking fund payments, of State railways are increasing very materially every year. I ask all honorable members, in fairness: “ ls it any wonder that the State governments feel that they are not getting a fair deal? “ I ask the Government to have a look at this question of providing from revenue all these works and services for Commonwealth transport facilities and, of course, other things, while the States are being asked to pay both interest and sinking fund charges on capital works from loan moneys, and therefore are very heavily handicapped by comparison.

Before the Hughes and Vale decision of the Privy Council, the position was being roughly held as far as competition between road and rail transport was concerned, but in each State different sets of conditions operated. The confusion that existed before the hearing of that case was nothing as compared with the present chaos, lt is all very well to talk about roads. Australia has a very different problem from that of the United States of America. In. this country the crescent of density of population is around the coast and the main traffic arteries run inland towards the farming communities where the population is much more sparse. There is not sufficient money in Australia to build roads of the standard necessary to carry existing heavy traffic.

We must not allow the position to drift. I was sorry to hear the honorable member for Batman (Mr. Bird) say this afternoon that recently the Australian Transport Advisory Council passed another pious resolution on roads, but that it did not decide to try to do anything to solve our transport problems. I was amazed to find that during a recent discussion at the Institute of Political Science the only representative of the Federal Government, a representative from the Department of National Development, had said that it was not the responsibility of governments to find the answer to transport problems. I do not believe that that is the attitude of the present Minister for Shipping and Transport (Senator Paltridge). I know the difficulties that confront him. We should at least try to straighten out the problem. Freight costs affect everything that the farming community buys and sells, and therefore our overseas balance of payments. Moreover, it affects the Commonwealth-State financial agreements, as I pointed out when 1 referred to the financing of capital works and services out of revenue. The Hughes and Vale decision alone means an increased deficit to the Victorian railways of almost £2,500,000 a year.

On several occasions the road transport people have asked for the establishment of committees to investigate the problem, but their requests have been refused, lt would be of no use for me to give details of the problem. Surely the Transport Advisory Council could obtain the services of experts to provide a satisfactory solution of the problem and to put it into operation, even if to do that required an amendment of the Constitution. I realize that section 92 of the Constitution makes the position very difficult. I do not suggest that the matter should be referred to the Constitution Review Committee but that it should be dealt with as an urgent, vital and important problem. It is of no use to go to sea in a leaky vessel.


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


.- To-night, the committee has discussed two fundamental questions in our economy. One was the question of import controls and the other the question of transport. The longest speech that has been made to-night was made by the Minister for Trade (Mr. McEwen). Indeed, it is the longest speech that honorable members have heard during this sessional period; but it did not deal with any of the questions of trade or any of the matters that necessitate import controls. The Minister gave no indication of how he would overtake the continuous drop in our trading balance and our overseas reserves.

At the end of June last, Australia had smaller net gold and foreign exchange holdings than it had at the end of any previous financial year during which this Government has been in office. It was the smallest holding that the country has had since 30th June, 1948. Whereas our foreign reserves rose by almost £300,000,000 during the last year and a half of office of the Chifley Government, they dropped by £431,000,000 in 1951-52 alone and by £142,000,000 and £73,000.000 in the last two years. If it had not been for foreign investments coming into Australia, the position would have been still worse. Last year we had a deficit on current account of £221,000,000 and in the year before, £257,000,000. If the position continues to deteriorate at that rate, we have only until the end of next calandar year to retain any foreign reserves at all. The Minister made no explanation about how he would counteract that trend.

If we look at the imports position during this Government’s term of office, we find that, when in the first two years Australians received record wool cheques, there were also record imports. We immediately spent, largely on unessential goods, that extra bounty that we received. Since then, we have had to restrict our imports by exercising one of the Commonwealth’s few constitutional, economic powers. The speech of the Minister for Trade was characterized by the Government’s usual repudiation of economic controls, but at the same time he overlooked the fact that this Government has exercised a more rigorous, rigid and sudden measure of control than we have ever had in Australia before. Where this Government has exercised the Commonwealth’s power to restrict bank credit and public investment and impose import control and taxation, it has been most deliberate and sudden. If we had a balanced system of economic controls. including controls over prices, interest ratesand private investment, the controls that the Government has continued to exercise during almost seven years of office would” bear less onerously on the small man and: persons who are setting up in business for the first time. The outstanding feature ot the Government’s exercise of controls hasbeen that they have fallen hardest on the small man and have left the big man in a still more prominent and affluent positionin the community.

Now I pass to the question of road1 transport. I have never more greatly admired a speech by the honorable member for Chisholm (Mr. Kent Hughes) than the one he made to-night. Transport costs are the biggest element in Australia’s costs. The honorable member quoted from the report prepared for the tenth meeting of the Australian Transport Advisory Council’ in August last year. Emerging from that report is the fact that one-third of every £1 of Australia’s national income goes in transport costs. If we are to reduce our costs, and if we are to increase our standard of living, the value of what we buy inAustralia with our incomes, and the net return on our exports, the first thing we must attack is our transport costs. I completely admire the approach of the honorable member for Chisholm to this problem. This Government has now been in office for almost seven years, but during that time, in contrast with the record of a Labour government during the four years immediately after the last war, there has not been developed a national policy in regard to Australian rail, road or sea transport. The honorable member for Chisholm was big enough to pay tribute to the honorable member for East Sydney (Mr. Ward) who. when he was Minister for Transport, did his very best to arrive at an agreement with the various States to rationalize, modernize and standardize the railways. It is to the credit of the South Australian Premier and to the honorable member for Chisholm, who was then Minister for Transport in Victoria, that those States at least were willing at that time to co-operate with the Commonwealth.

Mr Kent Hughes:

– They did, but New South Wales did not.


– I concede that, but the honorable gentleman will relieve me of the embarrassment of dealing with that point further. It is now time that this Government, after seven years in office, evolved a national transport plan.

We are dealing with the Estimates for the Department of Shipping and Transport, which has three functions: The running of the Commonwealth Railways, the running of the Australian Coastal Shipping Commission, and the running of the Australian Shipbuilding Board. In each of these three directions its record has been pitiful. The Commonwealth Railways cease 380 miles from Perth, 134 miles from Adelaide and 253 miles from Broken Hill. It is an admirable, modern, efficiently conducted railway which goes from nowhere to nowhere.

Secondly, we have an Australian Coastal Shipping Commission which was formerly the Australian Shipping Board. That was a board which was building up the largest and the only modern fleet on the Australian coast. After six and a half years of office, the Government produced an agreement with the private shipping companies which had small fleets of outdated, antiquated craft. By that agreement the Commonwealth ships were not allowed to expand in number, or to expand in trade, except on the unprofitable routes.

Thirdly, we have the Australian Shipbuilding Board which has not ordered any ships last year or this year, although the Tariff Board, in a report signed in June last year and tabled in April this year, found that Australian shipyards were operating at only one-third of their capacity. As the previous Minister for Shipping and Transport is no longer with us I shall not press this point too much, but I point out that every one of the twenty ships which private ship-owners in Australia have on order are on order in foreign shipyards and the Minister of that time, with an extraordinarily lax exercise of his conscience, gave authority under the National Security Regulations which operated up to a few months ago for these ships to be built out of this country.

The answer that members of the Opposition invariably receive from Ministers on matters of transport is that these are State matters. Ministers refer to the fact that the Constitution which the founding fathers gave to us 55 years ago does not refer to roads, and reserves railways for the States.

The Constitution does not refer to airways either, for very clear reasons, but that position has been got over by the States conceding to the Commonwealth the control of aerodromes and aerial navigation. In consequence, our airways are our only truly modern transport service. If the States were to hand over to the Commonwealth the provision of their inter-capital highways or coastal highways and their railways, their budgetary problems would disappear. In that way, and in that way only, would we get a national plan to develop our road and our rail transport.

To the transport facilities that I have mentioned I would add those of the ports. Whereas the railways are run under six State administrations, our ports are run by 25 different authorities, as appears from the report of August, 1955, to which the honorable member for Chisholm has referred. The astonishing thing is that these reports are not tabled in the House, they are not discussed in the House, and Ministers themselves do not have copies of them in their offices. Last session I sought to discuss the other report which the honorable member for Batman (Mr. Bird) discussed earlier to-day, the statement on Australian roads which was prepared for the Australian Transport Advisory Council at its meeting in February of this year. I found that a copy was not to be obtained in Canberra, even from the Minister for Shipping and Transport (Senator Paltridge) or the Department of Shipping and Transport. 1 concede that the Minister’s staff quickly got me a copy from Melbourne which I was able to use on the following day. But it is indicative of the Government’s complete irresponsibility and its laissez faire attitude in these matters that the Government does not present to, or have discussed by. Parliament these reports which are prepared for the guidance of the governments of six States and the Commonwealth which are represented on the Australian Transport Advisory Council, although these vital reports touch the expenditure of a third of the Australian national income.

We alone are in the position to coordinate Australian transport systems. We alone have the incentive to co-ordinate them. We alone have the financial resources to co-ordinate them. No State Commissioner of Railways is concerned about a break of. gauge because no Commissioner of Railways, except the one in South Australia, has any break of gauge within his boundaries. The New South Wales and Victorian commissioners both say, “ Who is to standardize railways? “. If, however, the railway from Sydney to Melbourne were in the hands of the Commonwealth, the breakofgauge would soon be cured - just as truly as it would have been cured if there were a break-of-gauge, for instance, at Goulburn or Seymour. If one authority were in charge of the railways, that breakofgauge would be intolerable and the responsibility would swiftly be sheeted home to the appropriate Minister.

If there were a standard gauge between Sydney and Melbourne - the two points between which heavy road transport is making such havoc of the roads via section 92 of the Constitution - the railways would, indeed, compete with road transport. The railways would fear no competition from the hauliers. But the railways will continue to suffer unfair competition by road with disastrous loss to the capital investment that we have in the railways, as long as there is that break-of-gauge; and there will continue to be that break-of-gauge until one authority is responsible for the whole stretch.

I come to the matter of inter-capital highways. It was made plain by the Privy Council’s decision in November, 1954, in the .Hughes and Vale case, and in the High Court’s subsequent decision in June last year, that no State government can devise a system of financing the highways to which interstate transport will contribute in any way at all. I am not seeking to defend every feature of the form of taxation which South Australia, Victoria, New South Wales and Queensland had imposed for a quarter of a century before the Privy Council decision was given on road transport. But after that decision those four States, because they are the only four affected by section 92 of the Constitution - the desert ruling out Western Australia and Bass Strait ruling out Tasmania - together devised charges under which interstate transports would pay not one penny more per mile or per ton than intra-state transport. But the High Court, caught in its own toils and in the toils of the Privy Council’s decisions on section 92 in the last couple of decades, ruled that those charges also were outside the Constitution. The Commonwealth, however, with its monopoly of excise power, can levy petrol, diesel and tyre taxes which are fair in their incidence, easy to collect and adequate for our road needs.


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


.- If do not think there is any doubt at all that the powers relating to communications should be re-allocated between the Commonwealth’ and the States. The greatest change that has taken place in the Commonwealth since the Constitution was drawn up 56 years ago has been in the communications field. The horizon has been brought closer, owing to the speeding up of communications generally - road, rail and signal communications.. For that reason, this Government has set up a committee to investigate the Constitution in the light of our needs in the present day. I hope that that committee will soon produce some useful results. I hope that it will do much to overcome some of the problems that are being encountered at the present time through the operation of the Constitution, particularly in the transport field. I say that with some feeling because my electorate happens to be a long way from the capital city of my State and we suffer from very poor communications indeed.

Since it was formed a short time ago the new Department of Trade has done some outstanding work in developing our export markets in nearby countries and in faraway European countries. However, I urge the Minister for Trade (Mr. McEwen> not to confine his efforts to the immediate problems of our export and import requirements, but to look at the long-term trend. I can see a very dangerous situation developing as the Communist countries expand’ their industries at a very fast rate - so fast, indeed, that they will be able to compete with the western democracies in world markets in a very few years. That processhas already begun. We can see the effects of Russian trade missions in various countries at the present time. Buying and selling prices mean nothing to a totalitarian country. They are a mere bagatelle. If Russia, and its satellite countries decided to disrupt the pattern of trade between the Western democracies they could do so very easily. Indeed, they could play ducks and drakes with trade between the Western countries. I believe that in the long run we should take steps to counter such action.

Communist action will have very little effect in the United States of America, which is practically self-sufficient, but it could have vital effects upon the smaller democracies and the European countries. Some European nations already are alive to this danger. The six nations of the Messina group - France, Italy, West Germany, and the Benelux countries - are meeting to discuss the formation of a free trade zone in western Europe. I believe that the United Kingdom Cabinet is considering the advisability of Britain joining the group, and I hope that the Australian Government will give Britain every encouragement to do so, because a powerful market in Europe could be of inestimable benefit to Australia. England has traditionally been our largest market, and I believe that the formation of a solid bloc of manufacturing countries such as those which comprise the Messina group would be of great benefit, and would complement our economy very substantially and make the European countries concerned, as well as Australia and the other Commonwealth countries stronger and more stable. We must encourage this movement if possible and also take part in a re-grouping of the countries so that we, too, perhaps, could join a similar union, lt is proposed by the countries that V have mentioned to reduce all restrictions on trade, such as tariffs, to a stage at which there will be free trade between them. This is to be done progressively over a period of fifteen years so that no disruption will be caused. I believe that the Minister for Trade at the very least should have an observer from the Department of Trade at the meetings which are taking place in Europe at the present time.

I turn now to the Estimates for the Department of Social Services. The pattern of social services is now well-established in Australia. It covers a very wide field, including age and invalid pensions, allowances to the wives and children of invalid pensioners, funeral benefit, widows’ pensions, maternity allowance, child endowment, unemployment and sickness benefits, rehabilitation services, and subsidies paid under the Aged Persons Homes Act. That is a very comprehensive list of social services benefits, and I believe that no major change in the present scheme is needed. There are certainly some rough edges to be smoothed off and some anomalies to be corrected, but I should like to see the present pattern maintained for a number of years. It would be quite wrong to expand social services to any great degree, because the additional burden would be too heavy for the bread-winners to bear. Any substantial expansion of our social services would mean greatly increased taxation for wage and salary earners. As I stated recently during the budget debate, I believe the Government should take steps to permit those who wish to save for their old age to enjoy the full benefit of their savings. lt should initiate a savings drive so that those who are thrifty and prudent may be able to augment their own personal savings by the age pension.

The report of the Director-General of Social Services reflects great credit on the administration of a great department. Very few departments have such a fine record,. The Department of Social Services is very large - 1 understand that it employs 2,300 people - and does a very satisfactory and thorough job throughout Australia. Here are some statistics which impressed me: Since 1950 expenditure on administration, expressed as a percentage of the benefits paid, has increased by only .03 per cent., although costs generally throughout the community have increased substantially in the same period. This means that for almost the whole time during which the present Government has been in office the department has not merely maintained its efficiency, but obviously has substantially improved it, because it is transacting far more business than six years ago. The total expenditure on age and invalid pensions has more than doubled. It has increased from £41,000,000 to £101,000,000. Expenditure on widows’ pensions has almost doubled. Expenditure on child endowment has increased from £24,000,000 to £60,000,000 since 1950, although, as I have said, expenditure on administration, expressed as a percentage of the benefits paid, has increased by only .03 per cent. That is a very fine record. As it shows, and as honorable members know from their daily contacts with departmental officers in their representations on pension matters, it is clear that all officers of the department discharge their functions in the best traditions of the Public Service. I believe that the pensions scheme is administered wisely and with a great deal of sympathy.

Finally, 1 wish to deal with the estimate for the Department of Territories. Here again, as in the case of the Department of Trade, a long view is necessary to determine what is the goal for our Territories. This evening, the Minister for Territories (Mr. Hasluck) spoke about discharging our national responsibilities. That is too vague an expression, and we should have a more definite goal. We must have some yardstick to judge whether we are spending too much or too little in the Territories. As any one who has visited the Territories knows, a great deal of money is being spent in ministering to the needs of the indigenous population - the natives - and it is possible to spend extravagantly. I do not know whether that is being done at the present time, and I will not venture an opinion. Unless a proper inquiry is made to ascertain exactly where the treatment of the natives is leading, it is hard to express an opinion as to the value received in return for the large sums spent on their welfare.

An examination of the economic side shows that the Government is spending a great deal of money in Papua, but is receiving very little practical benefit as a result. The report for Papua for the year 1953-54 - which is the latest I have - shows that the value of copra exported to the United Kingdom was £148,199, of curios to the United States of America, £19, of films to the United States of America, £57, of hides and skins to the United States of America, £2,139, and of trochus shell to the United Kingdom, £228 and to Japan, £3,029. That is the sum total of the primary exports overseas from Papua, but Australia has spent many millions of pounds to assist that country.

In the long run. we cannot expect that exports of primary products from Papua will be increased very much, because the native population is increasing rapidly, and it is not possible to alienate much land for development by white settlers. Consequently, the picture, on the economic side, is not very cheerful. The annual expenditure in Papua has been something a little below £9,000,000.


Order! The honorable member’s time has expired.

Northern Territory

– I wish to deal with some aspects of railway policy as it affects the development of the Northern Territory, but before doing so I refer to the statement made this evening by the Minister for Territories (Mr. Hasluck). He described the oft-repeated charge of bureaucratic control at Canberra as a fallacy. The Minister cited figures to show that the number of civil servants employed in the Northern Territory administration, as compared with the number employed in the Department of Territories in Canberra, was numerically in favour of the Northern Territory. The ratio was something like 500 odd to 200 odd.

Mr Hasluck:

– I said there were fewer than 200.


– The Minister says that there are fewer than 200 in Canberra, but that does not illustrate the real position The few who control the purse-strings control the policy of Northern Territory administration, and it would not matter if there were a thousand civil servants in the Northern Territory, and only twenty in the Department of Territories at Canberra dealing with Northern Territory affairs, the result would be that the twenty in Canberra would have the right to veto recommendations from the Northern Territory, and it would be they who would control the destiny of the Northern Territory.

The only way that the people of the Northern Territory can gather to ternselves more power to administer their affairs is to widen the powers and functions of the Northern Territory Legislative Council. If power is placed in the hands of the people of the Territory they will direct its administration in the best and most practical manner. But so long as control of the purse-strings resides in Canberra, there is no denying the fact that the destiny and policy of the Northern Territory will be controlled from Canberra, also.

A great deal has been said about railways during this debate, and some useful information has been given and valuable suggestions have been made. I wish to direct the attention of the committee to the fend that is taking place in the operation of the

Commonwealth railways. This instrumentality is becoming more and more a profitearning institution, and consequently is not playing the role intended for it - a means of development. The budget papers show that the railways operating within the boundaries of the Northern Territory, which are under the control of the Commonwealth railways - the Central Australian Railway and me Northern Austraiian Railway - last year made an aggregate profit of £400,000. The Central Australia line showed a profit of about £500,000, but the Northern Australian line showed a loss of under £100,000 so that in the aggregate, the profit was something in excess of £400,000.

The railways were not meant to make profits, although this is not the first occasion on which it has happened. I do not blame the Commissioner for Railways for achieving this result. He is charged, under an act of this Parliament, to run the railway as a business concern, and J am not denying that it is his duty to make the greatest possible profit. However, the Government should instruct the commissioner on policy, as has been done in the past. 1 shall illustrate my argument by citing the subsidy that the Commonwealth Government is giving to the State of South Australia. During the last financial year more than £500,000 - I think the figure was £591,000 - was paid by this Government from Consolidated Revenue to South Australia as a subsidy to meet the cost of hauling coal from Leigh Creek to Port Augusta at a concessional rate. Now, that was quite all right. That means that the subsidy was paid direct from the Consolidated Revenue Fund, and the commissioner was reimbursed for the concession that he granted. But we find that the position is to be altered in a most amazing fashion. Henceforth the subsidy given to the South Australian Government for the carriage of coal over its railways will be borne, not by Consolidated Revenue, but by the people who use the railways north of that point, or the whole of the users of the Central Australian railway system. To illustrate that point. I should like to quote from the budget speech of the Treasurer (Sir Arthur Fadden). The right honorable gentleman said -

The 1955-56 revenue figure includes a subsidy payment of 591.000 on the carriage of coal from Leigh Creek for the State Electricity Trust of South Australia. Recently a new rate for the carriage of this coal has been agreed between the Commonwealth and South Australian Governments, and the 1956-57 revenue includes no subsidy provision.

This means that this subsidy will, in fact, not be paid from Consolidated Revenue, but will be paid out of the trading funds of the Commonwealth Railways. When discussions were taking place between the Commonwealth Railways Commissioner and South Australia on the striking of the new rate for the carriage of this coal over the new standardized link between Port Augusta and Leigh Creek, the commissioner considered that the correct charge that should be made was in the vicinity of 30s. 5d. a ton - the figure cited by the honorable member for Griffith (Mr. Coutts) in his speech earlier in the debate. But the South Australian Railways and the South Australian Premier were greatly concerned at this figure and sought to have it reduced. Pressure was brought to bear on the Commonwealth Railways Commissioner in this respect. There is no doubt about that factor, because the new rate was announced as lis. 6d. a ton, or approximately 19s. a ton below the economic rate that had been set by the Commonwealth Railways Commissioner for the carriage of that freight. It is apparent that the Commonwealth Railways will lose, on the carriage of that coal, 19s. on every ton hauled over thai section - and the Commonwealth Railways Commissioner has indicated that he expects the tonnage to rise from 500.000 tons, last year’s figure, to somewhere in the vicinity of 1,500.000 tons when the operations are finally developed and proceeding at full capacity. This means that the Commonwealth Railways stand to lose somewhere in the neighbourhood of £1,250,000 a year in revenue. This is a subsidy which, the Treasurer tells us, the users of the Central Australian railway system have to bear, because it will be met from the trading funds of the railway. I say that this is a remarkable state of affairs. If the South Australian railways or the South Australian Government has to be subsidized, it should be subsidized directly out of the Commonwealth Consolidated Revenue Fund, and not out of the trading funds of the Commonwealth Railways. In that way, the users of the rail.way itself would be paving the rates they should justly pay. They should not be loaded with an additional amount of £1,250,000 in excess of the amount they now have to find. I repeat, if the South Australian Government has to be subsidized because of the peculiar position it finds itself in, the Consolidated Revenue Fund is the fund from which the subsidy should come. It should not come from the trading funds of the Commonwealth Railways.

The effect of this increase - and there must be an increase to consumers along the line, and the users of the line - will be a continued rise of the cost of living of every person in the Northern Territory, whether he be a wage-earner, a producer, a trader or anybody else. We know that because the Northern Territory is a Commonwealth territory wages there are pegged, and the margins that the wage-earner gets are frozen and are totally inadequate for his requirements. Here is a means that the Commonwealth has at its disposal to contribute to a lowering of the cost of living and a lengthening of the margins of the wage-earners in the Northern Territory - a direct contribution that can be made by this Government to the wage-earner of the Northern Territory. The Government can also help the development of the Northern Territory, and can help the people who go there to settle, or invest capital to assist its development. Freight charges could be lowered. Costs to the community in the Northern Territory could be lowered either in the shape of a reduction of the price to the consumer of every-day commodities, through a reduction of freights - a reduction of inward freights on material needed for development and on outward freights on the Territory’s products. I say that the Government should effect this reduction as an immediate step towards helping in the development of the Territory.

The South Australian Government is not so remiss as to omit to give preferential treatment to the users of its own railways, and it is a fact, Mr. Temporary Chairman, that users of the Central Australian Railway - that is, the consignees beyond Port Pirie - have to bear a charge in respect of goods of a certain classification of £8 9s. 6d. for every ton shifted over the South Australian railways from Adelaide to Port Pirie, whilst consignees of goods carried within the State, and to Western Australia on the transcontinental line, pay for goods of the same classification a rate of only £2 12s. lOd. a ton - a difference in favour of South Australian and Western Australian consignees of something like £5 16s. 8d. a ton. That is a remarkable discrimination between the two types of consignees. On class C goods the charge to Central Australian consignees is £5 9s. 6d. a ton compared with the charge to South Australian consignees of £2 5s. 6d. a ton - a difference of £3 4s. a ton.

I think that the Minister for Territories (Mr. Hasluck), who is at the table, should confer with his colleague, the Minister for Shipping and Transport (Senator Paltridge), with a view to having immediately taken up the matter of these freight differentials agreed on between the South Australian Government and the Commonwealth Railways. I say that, owing to its geographical position, the Northern Territory has to rely on transport facilities to a greater degree than have other parts of the Commonwealth.


Order! The honorable members’ time has expired.


.- In the time at my disposal I should like to direct my remarks to the proposed vote for the Department of Trade, because I believe that a debate on the Estimates of that department is a more appropriate debate in which to discuss some of the most important phases of the Suez Canal dispute than is a debate on foreign affairs. It seems to me, rightly or not, that we have to face up to the problem that we shall have to enjoy life somehow without the Suez Canal at our disposal and that, whatever the trend of the course of events, with or without war, with or without agreements that may be concluded with Colonel Nasser or his successor, we must face a period in which we can no longer rely on the undisturbed use of the canal.

Mr Makin:

– I rise to order, Mr. Temporary Chairman. I am very reluctant to intrude upon the honorable gentleman’s remarks, but I should like to direct your attention to the fact that other honorable members have been denied the opportunity to speak on this particular subject during this debate. In those circumstances, I ask whether the honorable gentleman is in order in raising a matter which is: already on the notice-paper?


– I have been listening very closely to the honorable member for Mitchell (Mr. Wheeler) and he has so far related the Suez affair to trade. Provided he continues to do so he is in order.

Mr Haylen:

– I rise to order. J submit that whether or not the honorable member relates the Suez affair to trade that matter appears on the notice-paper and, therefore, he is entirely out of order in raising it during this debate.


– I have given, my ruling. If. any honorable member disagrees with it a proper course is. open to. him.


– The honorable members. for. Bonython (Mr. Makin) and Parkes (Mr. Haylen), with their characteristic impetuosity, have not even given me the opportunity to inform the committee that all I have’ to say about the. Suez Canal is concerned with- trade, alone. If mention of the Suez Canal offends those honorable gentlemen the purposes of my argument could equally be served by relating it to the. Panama. Canal-. Had I been allowed to proceed they would have realized that I was dealing with, trade.

It seems- that the day is coming when the Suez Canal will not be open freely for use at- an economical rate. This waterway has dominated Australia’s thinking for many years, but a closer examination indicates that its loss need not be such a disaster for Australian trade as might at first be thought. The loss of the Suez Canal will increase the distance by sea between Australia and Europe by 800 miles. To compensate for that, however, the situation that will arise promises substantial benefits to Australia in trade with Asia and with the Middle East if. we gear our overseas commercial machine to take advantage of those opportunities. The real problem of going round the Cape is- not so much the extra mileage involved as the fact that the distance is largely an unproductive haul for cargo. It involves a long sea- run without ports. However, Australia’s traditional policy of living by exporting raw- materials to Europe and importing manufactures in return has already lost a great deal- of its attraction. One has only- to look at our recurring crises in foreign exchange and continually increasing import restrictions to realize the truth of that statement. Great Britain, which is Australia-‘s principal market, has become unprofitable because it will take only a big proportion of our commodities- at an unpayable price to’ our producers. To get that export trade we buy from Great Britain a much, greater, volume of imports at prices very often above, what we would have to pay else? where. The combination of low export prices and high import prices is steadily driving Australia into bankruptcy in international trade. However much goodwill we may feel towards Great Britain, iiic situation is one which must have its limitations in the interests of both countries.

A re-assessment of our whole trade, if it were not overdue before the Suez crisis* is certainly warranted now in the light’ of recent events. I’ know that the Minister for Trade (Mr. McEwen) has laboured long and’ earnestly to obtain, a new deal from Great Britain, in respect of our contracts; but. I’ cannot see. how Great. Britain can give Australia anything worth while when, the trade of the two countries is no longer complementary as it used to be. Europe, and principally Great Britain, must remain our market and supplier for a long time to come, but it is time we recast our. thoughts to include a larger share of trade with countries in our half of the world. If the situation at Suez forces us to make a reassessment it may be a blessing in disguise. If we are alert we should devote ourselves to some solid “ After-Suez “ thinking in order- to gain trade advantages rather than suffer the disaster which so many anticipate and predict. If we face the realities of trade at the moment, nothing is to be gained by bemoaning the loss of the use of the Suez Canal’ and what that loss might mean to the United Kingdom. It is to be hoped that having profited from its experience the United Kingdom will show a little more realism and virility in its future diplomacy and will safeguard its trading posts of Hong Kong and Singapore.

Turning to affairs in Australia, it is obvious that we should concentrate on trade with countries in our immediate vicinity. There is no time better than the present to explore future- trade prospects with SOuth.East Asian countries. The problems of

South-East Asia are the problems of Australia. The ill-fated Avro Vulcan bomber reminded us that Australia’s isolation is a thing of the past. Recently, that bomber made a non-stop flight from Singapore to Melbourne in, I think, six hours fifty minutes. Every recent happening, whether on the political, commercial or scientific front, points to the fact that Australia’s future is wrapped up with its capacity to hold its established markets, and, at the same time, seek new markets. New markets require new methods and a new approach whether they are on a trader-to-trader basis or are inspired by governmental activities. To procure these new markets will cost money. I note from the Estimates that, excluding administration expenses of £856,000 and a Tariff Board provision of £75,200, an amout of £508,800 is provided for the maintenance of overseas commercial intelligence services. The question arises in my mind whether that vote is large enough and whether sufficient funds are to be made available to enable our trade representatives to talk, live and sell Australia on the same level as do the representatives of other countries.

Australia needs capable trade representatives overseas, and we must offer salaries and living conditions high enough to attract not only trained men from the department but also men from other spheres of commercial activity. The man who accepts an appointment as a trade representative, or in the diplomatic service, makes a great sacrifice for his country and should be well compensated for the loss of equity interests which other men who remain in Australia may build up. The feeling has been fostered by old die-hards and colonials that in a young country like Australia our representatives are lacking in background and in the traditions of commercial and trading experience which is part of the inheritance of older countries. To some degree that impression has unfortunately gained ground. Repeatedly our trade negotiators, with the United Kingdom for instance, have not completed satisfactory agreements. That has not been because they have been outsmarted. Quite frequently decisions have been made by the United Kingdom traders before the Australian representatives have reached the conference table, and all that has remained to be done has been for the contract to be signed and the colonials to be duchessed and permitted to go back home. But I have faith in our trade representatives abroad, and 1 am insular and provincial enough to believe that there is always a good selling line in a steady flow of Australianism. If we are Australians selling Australia, bt us do it, by all means, in the Australian manner. However, our representatives must have the backing of goods. That backing should be not only in physical merchandise and goods, but also in private and governmental knowhow. The development of market technique is costly both for private enterprise and on a governmental level. Accordingly, I would much prefer to see a little less money spent here in Australia on unproductive government works and more spent in encouraging our industries, both primary and secondary, to develop production, manufacturing and marketing efficiency.

There is a wide field for trade promotion to our north. If, by virtue of the upheaval in the Suez Canal area, Britain’s trade should weaken in those parts of the world which Britain still prefers to call the Far East, we should be ready to make our bid for this trade, because we cannot afford to allow it to pass out of the hands of the British Commonwealth of Nations. When I say there are avenues of trade available, I wish to give the example of Formosa, which I recently visited. There, with a little imagination, we could become direct traders. Formosa buys, for example, approximately 2,000,000 to 3,000,000 United States dollars’ worth of wool tops each year. That is Australian greasy wool which has been purchased in the local market, shipped overseas, scoured and combed and freighted back to Formosa. That country also buys Australian goods, not from us, but through the trading posts of Hong Kong and Singapore which, of course, load on brokerage before the goods reach their destination. In addition, direct shipments of goods from Australia to Formosa are valued at from £1,000,000 to £2,000,000 per annum.

In Formosa, there is quite a market to be developed in Australian goods, and it is not difficult to imagine that, if we could add a little drive to our fond hopes for markets, we could establish a fair direct export trade not only in wool tops, but also in hides, metals and dairy products such as butter, cheese and processed milk. In Formosa, a popular brand of condensed milk comes from Denmark. This matter takes me back to my original remarks concerning the Suez Canal and the need to explore this situation from the stand-point of trade. It is to be noted that trade in Formosa is watched most carefully.

The CHAIRMAN (Mr Adermann:

Order! The honorable member’s time has expired.


.- As the honorable member for Mitchell (Mr. Wheeler) raised the question of the Suez Canal at this late hour of the debate on the Estimates for the Department of Trade, I feel obliged to make some reference to that matter. The honorable member has warned us that in future we shall have to enjoy life without the Suez Canal. He has said that ships will not be able to use the canal at an economic rate. I submit that there is no evidence whatever to support those two statements. In the first place, the Suez Canal, since it has been under the direct control of the Egyptian Government, has been open for traffic and every ship that has sought to use it has so far been permitted to pass through it, and, presumably, at a rate which is quite reasonable.

When we are considering reasonable rates for the use of the canal, I remind the committee that in the past rates have been fixed by the Suez Canal Company at a figure which is the maximum that the traffic will bear. As evidence of that, I refer the committee to a book called “ The Suez Canal “, written by Lieutenant-Colonel Sir Arnold Wilson. In that book he gives a survey of the profits made by the Suez Canal Company from 1888. According to the book, in 1888 the rate of profit earned on invested capital measured in franc shares was 16.8 per cent. The rate of profit was maintained at 25 per cent, from 1898 to 1903. In 1904 it became 28.2 per cent., rising to 33 per cent, by 1913. 1 remind honorable members that that was a return of 33 per cent, on invested capital. During the period of World War I., the rate of profit was 24 per cent, in 1914 and 1915, 18 per cent, in 1916 and 13 per cent, in 1917. That fall in profit was because of the war. However, the profit was back to 20 per cent, in 1918, and soon after the return to peace in 1919 the rate of profit jumped to 38.4 per cent. Throughout the 192U’s, the rate was between 27 per cent, and 37 per cent., and in the 1930’s the rate was always between 40 per cent, and 45 per cent. Therefore, it is not surprising that at page 1 70 of the book, written, as I said, by Lieutenant-Colonel Sir Arnold Wilson, who is hardly a radical in his viewpoint, we find this passage - (The Suez Canal) has almost the features of a monopoly, and the owners charge, in practice, as much as, and sometimes, as I have suggested, more than all the traffic will bear.

When one is looking into the future and states, as has the honorable member for Mitchell, that we shall not be able to use the canal in the future at an economical rate, let us bear in mind the rates that we have had to pay over the last 90 years to use the canal. If the Egyptian Government follows accurately the policy of a monopolist-


– Order! The honorable member is getting very wide of the subject before the committee. He can only discuss the Suez Canal in relation to trade.


– I am doing so. My remarks have a direct bearing on trade, because I am discussing canal rates.

Mr Mackinnon:

– I wish to raise a point of order. I suggest that the honorable member for Yarra is flouting your ruling, Mr. Chairman, by trying to advocate the Egyptian case for the control of the Suez Canal, which is the subject of discussion by the Security Council.


– I am discussing rates that may be charged. I am not advocating the Egyptian case. 1 did not introduce this matter into the debate; it was introduced in relation to trade and discussed particularly in relation to rates. However, I have now completed my discussion of that point, and I think that I have made it abundantly clear that the position is not as described by the honorable member for Mitchell, and we shall have to wait for the outcome of these developments-

Mr Roberton:

– I rise to order. I ask you, Mr. Chairman, whether the honorable member for Yarra is in order when he remains on his feet and argues with an honorable member who takes a point of order, regardless of your decision.


– Order! I am paying careful attention to what the honorable member for Yarra is saying. I have already given a ruling on the point of order raised. I shall continue to listen to the honorable member for Yarra.


– Thank you, Mr. Chairman. I wish to refer now to two matters raised in the course of this debate, one in relation to transport and shipping and the other in relation to trade. It has become apparent in the course of the debate, particularly from the remarks of the honorable members for Batman (Mr. Bird), Chisholm (Mr. Kent Hughes) and Werriwa (Mr. Whitlam), that there are problems facing the Commonwealth in relation to trade which have to do with the constitutional difficulties with which the Commonwealth and the States are faced, with the problem of financing the development of transport that arises from the division of control - the honorable member for Werriwa has pointed out .that there are 45 authorities in Australia endeavouring to control the operation of ports - and with the problem that arises from the serious deterioration of every one of our transport services. It has been recognized by those honorable members who have contributed constructively to the debate upon this subject that some kind of national leadership and planning are necessary if those problems are to be solved, but when those things are suggested the objection is invariably raised that national leadership and planning are not possible because the Commonwealth lacks constitutional power to plan.

I direct the attention of the committee to section 96 of the Constitution. Under the terms of that section, Commonwealth leadership and planning could be applied to the development of the Australian transport systems. Among other things, section 96 states that the Commonwealth may grant financial assistance to any State on such terms and conditions as this Parliament thinks fit. Very little use has been made of that section since federation. Use has been made of it for the purpose of granting money to the States for payment to universities, under certain legislation. The Government could make use of the section to grant money to the States for the particular purpose of bringing the transport systems of the country under a national plan.

It does not seem to me that any constitutional difficulty arises there, but in relation to that matter, as in relation to so many other matters, it appears that the real problem is the :lack of initiative by the Government. It is easy to blame the States for their errors and for over-spending in certain directions, but unless the Commonwealth is prepared to use the powers granted by section 96 of the Constitution to regulate and direct that spending, it has no right to complain about what the States are doing.

I shall conclude my remarks by referring to trade, lt has become quite clear in the debate that one of the most important Commonwealth departments to-day is the Deparment of Trade. It has become equally clear that that department is in a greater state of disorder and confusion than is any other department. A general inquiry into its operations would be thoroughly justified. I have reached that conclusion after an examination of the activities of the department in relation to both exports and imports. Let me deal, first, with exports. It is estimated that in the current year £584,000 will be spent upon what is called the Commercial Intelligence Service. I should like to know, and I am sure that other honorable members would like to know also, just what the Commercial Intelligence Service does. What are its functions? How and in what way does it contribute to Australian exports?

Mr Pollard:

– It is futile.


– It is futile, but we should like to know what it does. Then we find that a considerable sum of money is to be devoted to trade publicity. The figures are rather striking. In 1955-56, £88,000 was spent on trade publicity in the United Kingdom, and in the coming year £240,000 is to be spent. In all other countries, expenditure last year was only £51,000, and this year it will be only £75,000. It seems to me that there is a striking disproportion between the expenditure in the United Kingdom and in all other countries. That applies also 4.0 the Commercial Intelligence Service. Slightly less than one half of the expenditure on that service is incurred in English-speaking countries. No money is provided for commercial intelligence services in South American countries. in China, in Russia or in any -of the European Communist countries. If -we ate interested .in finding new markets, it seems to me that, if the Commercial Intelligence Service is not to be futile, those are some of the places where money ought to be spent.

I want to .draw the attention of the committee to .a matter that I raised recently in a question directed to the Minister for Trade. My question was as follows: -

Are there companies in Australia which are branches of, or associated with, companies established in ‘the United States of America and/or Great Britain, that are subject to agreement, franchises or other circumstances which have the effect of restricting or preventing the export to overseas markets of goods produced by these Australian branches or associates?

The answer that the Minister gave to the question was as follows: -

Some companies in Australia are understod to operate under arrangements with overseas companies which affect in varying degree the. freedom of the Australian company to export.

Apparently there are significant companies in Australia .that are restricted in their freedom to export. The answer to the question continued -

This is not ?an uncommon practice in international trade. No official list of such companies or of such arrangements in Australia is available.

It -is time that such a list was made available to Australia. I suggest that the introduction of the Holden motor car to, say, the Thailand market would be by a decision made in the United States of America, not in Australia. :If the Department of Trade is to do its job of discovering how Australian exports can be increased, we must have that information, and we must have it quickly.

I shall deal now with the imports side. I think that what the Minister for Trade failed to say to-night in his statement of how his import control system is working would be sufficient justification for an inquiry into the working of the system. Such an inquiry is far more necessary, I should think, than is an inquiry even into tariffs. I find that the Tariff Board, on page 10 of its report for this year, stated-


– Order ! That subject cannot be discussed under these Estimates.

Mr. -CAIRNS. - Whether we look at the matter from the stand-point of -imports or of exports, I suggest that it has been made clear that an inquiry into the operations of .the Department of Trade would .be thoroughly justified. On the exports side, we want .to know what the department is doing to find new markets for Australian goods. We want to know how the Commercial Intelligence Service is operating, and what is being done in the field of trade publicity. We want to know whether the department has ever regarded as possible the introduction of governmenttogovernment trading in some commodities with countries in which that , is the only kind of trade carried on.


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


– I do not propose to deal with the speech made by the honorable member .for Yarra (Mr. Cairns) except to say, Mr. Chairman, that I think it was most regrettable and distinctly to his discredit that he presumed on your well-known generosity in granting us a good deal of latitude in this debate by indulging in a certain amount of subtle propaganda on behalf of a contender in the very difficult Suez Canal problem. I think that the people who heard his remarks have been given reasonable cause to believe that his sympathies lie very much with one side in the dispute. That side is not one that generally receives much admiration from people in Australia.

Mr Cairns:

– I rise to order. I regard that remark as offensive. I made it quite clear in my remarks-


– Order! If the honorable member claims that he has been misrepresented, he may make a personal explanation.

Mr Cairns:

– The remark of the honorable member for Corangamite is offensive to me, and I ask that it be withdrawn.


– I did not hear the remark. What is the remark to which you object?

Mr Cairns:

– The honorable member said that my remarks showed quite clearly -which side I was on in the dispute.


– I rule that the remark was not unparliamentary, and nothing need be withdrawn.


– I shall not proceed further along that line, but will leave the matter to the public of Australia to judge. After listening, during this debate, to speeches concerning the activities of various departments, I wish to direct my remarks to a department which I consider to be the most important of all, having regard to the present economic position of this country. I refer to the Department of Primary Industry. 1 think it will be generally agreed that, by the nature of its activities, this department renders the greatest assistance to our primary industries and, one could almost say, thus makes it possible for other departments to function. 1 have the honour to represent a great rural constituency, in which a diversity of primary production is carried out. I frankly believe that many farmers, not only of this country, but throughout the world, have an instinctive suspicion of people in offices who are supposed to assist them with their various tasks. I shall refer now to some of the activities of this new department that was established last year and which, 1 believe, are of vast importance to our national economy. The importance of our primary industries is evident from the fact that, during the last two years, the average income from our export trade was £776,000,000, of which £643,000,000 was derived from our exported primary products. That was approximately 84 per cent. The remaining 16 per cent, of our export income was derived from the export of minerals and certain manufactured goods.

As this is the first occasion on which estimates for this new department have been submitted, I think it would be as well for us to consider some of the department’s activities, so that those who are interested in our great primary industries can gain an idea of the ways in which the department can assist them. The main functions of the department come under five headings. There is a section dealing with marketing and industry stabilization, and there is a Division of Agricultural Production. Another very valuable instrumentality is the Division of Agricultural Economics. Liaison between the

Commonwealth and the States is maintained by the Standing Committee of the Australian Agricultural Council. Then there is another section, that dealing with fisheries, which gained added significance as the result of legislation that was passed during the last sessional period. There is also an export inspection service, which performs very important work in relation to exports. The administration of the various marketing boards is a task of great magnitude, lt is, of course, expected that the boards that are appointed will carry out their several tasks without undue interference from the Government, but-

Mr Pollard:

– The Government has muzzled them.


– Although the previous Labour government interfered quite a lot with them, this Government has not done so. The boards that are charged with the responsible task of disposing of our enormous surpluses of primary produce have at their beck and call the assistance and advice that is available from the Department of Primary Industry. As you can well understand, Mr. Chairman, because of frequently changing world demand and world prices, a very heavy responsibility devolves on government instrumentalities such as the Australian Wheat Board, the Australian Meat Board and, particularly, the Australian Dairy Produce Board. I, personally, have received tremendously valuable assistance from the Department of Primary Industry, particularly the provision of statistical information regarding the markets that exist in various parts of the world for our primary produce, ruling prices, and other information of a like nature. Such information is invaluable to those, such as myself, who bear a responsibility to advise their constituents on problems associated with primary industry.

The information that the department supplied to me relating to the changed set-up in connexion with the export of dairy products was of very great value to me. Many dairy-farmers did not realize fully the change that took place when the British Ministry of Food ceased buying Australian butter and cheese in bulk, and this trade reverted to an ordinary commercial basis. One needed full, detailed knowledge of the position in order to explain to the dairyfarmers, when the first impact of the change-over affected their pockets, just exactly what was happening. 1 should like to acknowledge that I received very valuable assistance from the officers of the department in this connexion. 1 mentioned earlier the Standing Committee of the Australian Agricultural Council. This committee arranges for the State Ministers of Agriculture to meet with the Federal Minister as the Australian Agricultural Council in order to work out a line of co-operation between the Commonwealth and the States in relation to primary production. These meetings are of great value, not only to those engaged in primary industry, but to the community as a whole. But for this liaison, I am convinced that there would be considerable duplication in this field. The Department of Primary Industry also administers grants for extension services.

Mr Pollard:

– That system was inaugurated by the Chifley Government.


– I do not detract for a moment from the very valuable work that was performed by the honorable member for Lalor (Mr. Pollard) when he was a Minister in the Labour government.

Mr Pollard:

– Labour provided extension services to the dairying industry for five years, at a cost of £250,000 a year.


– At page 101 of the Estimates, under Division 224, there are set out in detail the various activities of the Department of Primary Industry. I come now to a very important aspect of the department’s activities. I refer to the export drive that it is conducting and its efforts to reduce the volume of imports from dollar countries. Honorable members will recollect that, quite recently, this Government provided valuable assistance to the Australian tobacco-growing industry. 1 referred, earlier, to the fact that, as a result of legislation that was passed during the last sessional period, the work of the Fisheries Division in the development of the fishing industry in Australia is now tremendously important. Money to extend its activities was obtained by the sale of the assets of the Australian Whaling Commission in Western Australia, about which we have heard many wails in this chamber. I want to point out that already the Commonwealth Scientific and Industrial Research Organization has a very active fisheries research section. 1 feel that some duplication of activity could arise if the fisheries section of the Department of Primary Industry should undertake research into the extension of our fisheries activities around the Australian coast. I know that a decision has not yet been arrived at as to the way in which these activities will be pursued, but I suggest to the Minister that before the final decision is made the matter should be very closely examined to ensure that no duplication occurs of activities in the Department of Primary Industry and the Commonwealth Scientific and Industrial Research Organization.

Another very important activity connected with the development of Australia’s export industries concerns the raising of the standards of our export products. Special staffs are engaged in inspecting meat, eggs, and canned, fresh and dried fruits for export. This is a necessary part of the activities of the Department of Trade, and, if it is carried out efficiently, Australia’s produce will be recognized abroad as being of a high standard of quality. I appreciated the suggestion inherent in a question asked last week by an honorable member in this chamber. He asked whether it would be possible to establish a standards association, with power to ensure that export products conformed to certain standards, in the same way as similar organizations have done in certain manufacturing countries. I believe that the department should consider the introduction of a scheme of this kind.

I shall close on this note: Whatever the activities of the department may be in the future, the energetic direction of the Minister and the loyal co-operation of his staff have in the past been of great assistance to Australia’s primary industries, which need all the help they can get if they are to continue to produce the goods so necessary to increase Australia’s overseas reserves. I should like to thank the officers of the Department of Trade publicity for the assistance that they have given me in dealing with some of the tricky problems that arise concerning the stabilization plan, and primary industry generally.


– I now find that the ruling that I gave when the honorable member for Yarra (Mr. Cairns) was concluding his speech was incorrect. The Tariff Board comes within the administration of the Department of Trade. As the honorable member was just about to conclude his speech when 1 gave my ruling, I do not think that he was unduly inconvenienced.

Minister for Social Services · Riverina · CP

– I am sure the committee will concede me the opportunity, in the few minutes that remain, to address myself to one or two observations that have been made in the course of this debate.

Dr Evatt:

– 1 rise to order. The honorable member for Wills (Mr. Bryant) rose at the same time as the Minister for Social Services. Did you see him, Mr. Chairman?


– Yes, I saw him.

Dr Evatt:

– And you passed him by?


– I gave the Minister priority.


– There are six minutes remaining in the time allotted for the discussion of the Estimates for this group of departments. I am sure that the Honorable member for Wills, whatever he had to say, would not be able to confine His remarks within the limit of six minutes, and1 1 am sure that I can say what I have to say in rather less time than that. I wish to thank the honorable members who have addressed themselves to the proposed vote for the Department of Social Services, for the very generous and gracious tributes that they paid to the officers of that department.

Mr Ward:

– Would I be in order, Mr. Chairman, in moving now that the honorable member for Wills be heard?


– No. It would have been necessary to move such a motion at the time I gave the call to the Minister.

Mr Ward:

– Well, there is no time like the present.


– The Minister is speaking now; the honorable member may not interrupt his speech.


– When I was so rudely interrupted by the honorable member for East Sydney (Mr. Ward), I had reached the point of thanking the honorable members who made generous and gracious references to the officers, of the department that I administer. It is a very large department; and its officers are engaged in the most intimate of human affairs,, dealing with men, women and children. Its activities, of course, involve almost the entire community, so wide are the ramifications of social services to-day. I must take this opportunity to express my own appreciation of the work of the officers of the department.

I wish now to refer to the excellent speech of the honorable member for Henty (Mr. Fox). He said that he and other honorable members were in favour of the abolition of the means test. I’ suppose it would be correct to say that every honorable member in this chamber who has applied himself to a study of the administration of social services, and who is free from political prejudices, would agree that the means test should be abolished, so that’ justice may be meted out to those who have during their working lives, made some provision, no matter how meagre, for their old age. or infirmity. We must appreciate that any attempt to abolish the means test would’ involve us in an immediate expenditure of no less than £115,000,000 a year. If every qualified person of pensionable age were to be granted the pension, the cost of. social: services, for age pensions alone, would immediately rise by £115,000,000. The total expenditure that the people of. this country would have to face for health and social services would be £342,000,000, and not £227,000,000 as it is to-day. Those who have not made a careful study of the position, of course, suggest that the problem can be solved by imposing a contributory charge, but, in the final analysis, a contributory charge is just another kind of tax, and it is a kind of tax that is not entirely acceptable to those who are not aware of its impact on the economy, not of the country but of the individuals within the country. Whereas taxation is confined to those who receive certain incomes, or who have property of a certain value, a contributory charge descends on the entire community, regardless of the circumstances of individuals or of their financial ability to meet the charge. It should be recognized that the abolition of the means test, if it resulted in the introduction of a contributory charge, would inflict very serious hardships on those least able to bear hardships at this time.

I have one final comment to make regarding the consequences of the abolition. of the means test. Wherever it has been’ attempted in any part of the world it has immediately required an additional compensatory social services scheme to provide for people in the desperate circumstances so eloquently referred to to-day by the honorable member for Scullin (Mr. Peters). I have told the committee what abolition of the means test would cost and what the consequences would be. The Government, however, is conscious of the very serious injustice that is inflicted on a deserving section of the community, the members of which, as I have said, have applied themselves to the task of providing for their old age.

Proposed votes agreed to.

Progress reported.

House adjourned at 11.31 p.m.

page 1133


The following answers to questions were circulated: -

Technical Training.

Mr Webb:

asked the Prime Minister, upon notice -

  1. Is he in a position to comment on the plan that was submitted to him by an all-party committee of the Parliament of Western Australia in connexion with the development of the north-west of Western Australia, including construction of a dam at the Ord River, road development, extended port facilities, and a subsidy for ship construction?
  2. If not, when does he expect to reply to the committee?

Royal Australian Navy

Mr Ward:

d asked the Minister representing the Minister for the Navy, upon notice -

  1. Was it decided by the Government,some time ago, to modernize H.M.A.S. “ Hobart “?
  2. Has the work now been discontinued and the ship placed in reserve?
  3. Has approximately £1,500,000 been expended on modernization?
  4. Does the change in Government policy mean that this amount of money has been unnecessarily wasted?
  5. Is it a fact that H.M.A.S. “ Hobart “ in its present state would be of no use to the Royal Australian Navy, and that an additional expenditure of at least £1,000,000 would have to be incurred if this ship were to fulfil any role in the fleet?
  6. If there has been official bungling, what is the explanation?
Mr McMahon:
Minister for Primary Industry · LOWE, NEW SOUTH WALES · LP

– The Minister for the Navy has furnished the following replies: -

  1. Yes. In 1950-51 when the Korean Warwas at its climax and the threat of global war “was considered much greater than now, it was decided that the “ Hobart “ should be modernized as a first class light cruiser. However, in view of the reduced world tension, the financial restrictions of 1952 disrupted this plan and it was then decided that she should replace the “ Australia “ as the training ship. Although her primary role was to have been as a training ship, she would also be used in war-time in an anti-raider role. In 1953, when it was decided that one carrier was to be in an operational stale, the nonoperational carrier became a logical choice for a training ship and thus, the primary role of the “ Hobart “ was removed. Only refitting work was completed and the “ Hobart “ placed in reserve.
  2. Yes.
  3. £1,386,170 was spent on refitting work and some items of modernization which would be necessary no matter in what role the ship might be employed.
  4. No. Work done was on the hull, machinery and electrical wiring which are now good and can be used in whatever role in which the ship is completed.
  5. The ship could be completed for various roles such as convoy escort or guided missile ship. Expenditure necessary to complete “ Hobart “ would depend on which role was chosen but would be approximately £1,000.000. To build a comparable vessel to-day would cost not less than £10,000,000.
  6. There has been no bungling, official or otherwise.

Rail Transport

Mr Whitlam:

m asked the Minister repre senting the Minister for Shipping and Transport, upon notice -

  1. Has the Commonwealth had discussions in the last twelve months with the South Australian Government for the conversion of the railway between Port Pirie and Cockburn to 4-ft. 8½-in. gauge?
  2. Has the Commonwealth ever taken steps to acquire the Silverton tramway in accordance with the Railway Standardization Agreement (South Australia) of 1949?
  3. Has the Commonwealth had discussions in the last twelve months with the Western Australian Government for the conversion of the railway between Kalgoorlie and Fremantle to 4-ft. 8½-in. gauge?
  4. How often, and for what periods, have trains been unable to travel between Marree and Alice Springs owing to floods in the last ten years?
Mr Townley:
Minister for Air · DENISON, TASMANIA · LP

– The Minister for Shipping and Transport has furnished the following answers to the honorable member’s questions: -

  1. No. The conversion of this 3-ft. 6-in. railway to 4-ft. 8½-in. gauge is provided for in the Rail Standardization (South Australia) Agreement Act No. 83 of 1949. No time is stipulated in the agreement for the carrying out of the work. The Government of South Australia has indicated a preference for work in the Mount Gambier area to be undertaken first and work in this area is proceeding.
  2. Preliminary discussions took place in 1952 between the Commonwealth Railways Commissioner and directors of the Silverton Tramway

Company in connexion with the proposed acquisition of that railway, but, although the directors of the company expressed a willingness to dispose of the assets, agreement was not reached on an acceptable value of the assets. Pending a decision on the time when the Port Pirie to Cockburn railway may be standardized, no further discussions have taken place for either mutual transfer or compulsory acquisition of the tramway.

  1. No. The last discussions between the Commonwealth Railways Commissioner and the Western Australian Government Railways Commission took place in September, 1954. It was decided at the conference that the Western Australian commissioners would supply further information in connexion with the cost of standardization, rehabilitation and related matters. The information has not yet been furnished by the Western Australian Railways Commission.
  2. By financial years, the information sought is -

A total of fifteen occasions for a total of 91 days over the ten-year period.

Trans-Australia Airlines

Mr McIvor:

r asked the Minister for Civil Aviation, upon notice -

What amount was paid to the proprietors of the Hotel Darwin by Trans-Australia Airlines for (a) accommodation offlying crews, and (b) office accommodation in each of the years 1952 to 1955, inclusive?

Mr Townley:

– The answer to the honorable member’s question is as follows: -

The Australian National Airlines Commission is required by statute to table, each year, its annual report and financial accounts, accompanied by a certificate of the Auditor-General. I shall shortly be presenting to the House the report for the year ended 30th June, 1956. The financial accounts include a profit and loss statement showing items of expenditure under various headings. It is not considered appropriate that the commission. which operates in competition with private enterprises, should be required to disclose this expenditure in any greater detail than is customary for other commercial enterprises engaged in similar activities.

Mr Bryant:

t asked the Minister for Civil Aviation, upon notice -

  1. Does Trans-Australia Airlines wish to take over, when they are vacated, the premises now occupied by the Government Aircraft Factory at Essendon?
  2. If so, will the airline offer employment to tradesmen at present employed at Essendon, and how many will it employ?
  3. Are skilled tradesmen leaving, or planning to leave, their present employment because of doubt about the future?
  4. If so, will he endeavour to have negotiations accelerated and a firm announcement of intention made as soon as possible?
Mr Townley:

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

  1. Yes.
  2. There are a limited number of vacancies for tradesmen and semi-skilled labour in the Trans-Australia Airlines maintenance and overhaul organization at Essendon, and favorable consideration in filling these vacancies would be given to any applicants at present employed at Essendon by the Department of Aircraft Production.
  3. To date, no skilled tradesmen have resigned from the Department of Aircraft Production at Essendon. I cannot, of course, advise concerning the future intentions of these men.
  4. Negotiations for the transfer of the premises are proceeding as rapidly as possible, and it is anticipated that Trans-Australia Airlines will be in occupancy in the first half of next year.

Cite as: Australia, House of Representatives, Debates, 3 October 1956, viewed 22 October 2017, <>.