22nd Parliament · 3rd Session
Mr. SPEAKER (Hon. John McLeay) took the chair at 2.30 p.m., and read prayers.
– Is it a fact that the Prime Minister, during the election campaign in 1949, undertook to advance plans, when returned to office, to ensure that the fundamental basis of all incentive schemes would be the right of the worker, as well as the shareholder, to his share of increased profits? If so, will he state what progress has been made in formulating such a scheme in the nine years which have since elapsed, and when does he propose to announce the details of his plan? Finally, has the Prime Minister’s receipt of a legacy of £1,000 a year from the accumulated profits in the estate of the late Sir William Angliss any relationship to his proposed profit-sharing scheme?
– I do not think any good purpose will be served by crossexamination about the contents of a document. My speech of 1949 is on record. Nothing in our past joint history encourages me to believe that any quotation from it by the member for East Sydney will be accurate. As to the rest of the question, I really must arrange for somebody to leave him a little recognition of a life of virtue.
– I direct a question to the Minister for Labour and National Service: In view of the edict of the Australian Council of Trade Unions to the maritime unions to cease their demands on shipowners for so-called indemnity payments, or stand-over money, will the Minister comment on the latest demand by the maritime unions on the owners of the vessel “ Iron Bark “ for such a payment? Further, is the money being extorted ‘by the unions finding its way to Communist party funds? Will the Government consider instituting its own inquiry into this now seemingly accepted but unsavoury practice.
– The honorable gentleman states as facts certain matters which have not yet been confirmed by the inquiries of my own department as being facts. It has come to our notice that a vessel purchased by John Manners and Company, of Hong Kong, has been held up because there has been a refusal to supply the crew for a tug which had been assigned to tow this vessel to another point in Newcastle harbour. Immediately this came to my notice, I arranged for the department to set some inquiries going into the matter. Those are still proceeding, but I understand that in the meantime the tug company in question, the Waratah Tug and Salvage Company Proprietary Limited, has placed this dispute, or the failure of the unions to supply a crew, in the hands of the Industrial Registrar of New South Wales. Presumably an official inquiry will be made by him into the circumstances of the absence of a crew. As to whether this Government will institute an inquiry, I previously informed the House that we had not yet dismissed the possibility of the need for an inquiry, and this development and others are being kept under observation with that possibility in view.
– Will the PostmasterGeneral inform the House whether all the Postal Department’s training schools in Australia have been closed? Is the closing down permanent; and what scheme, if any, is to be substituted to provide for the training of young postal officers? Is the PostmasterGeneral aware that these training schools were established by the Chifley Labour Government in 1945 and that, as a result, hundreds of returned servicemen were rehabilitated? Since then, because of the splendid training that they received at these schools, many young officers have reached a level of efficiency that was not previously contemplated. I should also like to know how the Minister intends to use the splendid staff of highly trained instructors who were employed at the schools. Those instructors, numbering up to 50, were given a splendid course of coaching at universities and technical colleges to fit them for the techniques of teaching. Are they to be scrapped?
– I have already received an inquiry from another honorable member, whom I am unable to name at the moment, on this matter. It is not correct to say that all training schools in the PostmasterGeneral’s Department are to be closed. Within the department we carry out a great deal of technical training in the various grades of the service, and that is to be continued. Some sort of reorganization is being carried out, but I have not the details in my mind at the moment. However, I have undertaken to supply the information to my other questioner, and I shall undertake to do the same for the honorable member for Banks.
– Has the attention of the
Minister for Trade been drawn to the serious and critical situation that has developed in the South Australian almond industry since I first raised the matter with him some months ago? Is he aware that the price and quantity of cheap imported almonds are such that the income of many producers who rely on almond production alone will be below subsistence level this year? In the circumstances, can the Minister do something to speed up the Tariff Board inquiry that he promised months ago? In addition, does he not consider that the arguments used in favour of the restriction of the importation of cotton textiles pending the report of the Tariff Board apply with even greater force in this case?
– The honorable member has displayed a continuous and keen interest in the problems of the almond producers of his State. As a result, I have made inquiries, and have been informed that the price of imported almonds has steadied over a recent period at a considerably lower level than previously. This accounts for the problem in which the honorable member has interested himself. The matter has been referred to the Tariff Board. The board has not yet conducted its inquiries into the problems of this industry, and I am not able to say how soon that will be done; but I am perfectly sure that the board itself will not allow any avoidable delay to occur.
On the other hand, I hope it will not be expected that the quite exceptional action that was taken in connexion with the printed cotton textile industry will become a regular action to be expected in the case of a variety of industries. There was a quite exceptional and unique series of circum stances affecting the cotton textile industry which has never enjoyed a protective tariff in Australia. In respect of that industry, we are to receive a recommendation from the Tariff Board within a matter of weeks in whatever form it may be. In the meantime, the Government became aware not only of a steep increase in the importation of printed cotton textiles, but also, through the knowledge gleaned by scrutinizing applications for import licences, of the fact that there would be a torrent of imports unless something was done. A tremendous flood of imports of printed cotton textiles just before a Tariff Board recommendation for protection could have the result of negativing for a long period anything the Tariff Board might have had in mind. Nothing I say now is to be construed as indicating that 1 have any prior knowledge of what the Tariff Board may do in that regard. The almond industry is no; similarly situated.
– In the absence of the Minister for Supply and Defence Production, I ask the Minister for Defence a question. Recently, a report by Mr. Scott on the St. Mary’s project was placed in the Library for perusal by honorable members. That report contained serious criticisms of the project: I say no more than that. The report has, I understand, now been removed from the Library. Will the Minister take steps to ensure that it is restored to the Library, because several honorable members are still seeking an opportunity to read it? The report is not one that can be read and digested quickly. I ask this question of the Minister for Defence because the matter has some relation to his department.
– I shall ascertain why the report was removed, and I shall see whether it can be returned.
– I ask the Minister for Trade a question without notice. Does the United Kingdom grant to Japan and China, and to Hong Kong and other colonies most-favoured-nation or preferential treatment? Have United Kingdom exports to Canada and the United States fallen as a result of Japanese competition? Are wool exports to Japan likely to increase?
– The United Kingdom accords to Japan, continental China, and the Republic of China most-favoured-nation treatment, but Hong Kong and other British colonies are accorded preferential tariff treatment. United Kingdom exports to both Canada and the United States have increased very substantially since Canada and the United States made trade agreements with Japan. I shall furnish the exact particulars to any honorable member who is interested in them. They show a quite substantial increase in United Kingdom exports, as well as an increase in Japanese exports to Canada and the United States.
– Where do the goods go after they reach Hong Kong?
– I do not know, but, if they are re-exported, under our customs tariff law the actual country of origin must be indicated. So, there is no risk of leakage in that regard.
Japanese consumption of wool is increasing, and up to the present time it is overwhelmingly an internal consumption. The last figures that I saw - which are not very recent - show that about 80 per cent, of Japanese importations of wool was being domestically consumed and only about 20 per cent, was being exported. Therefore, japan has not merely taken the place of some other country at our sales. She is a new buyer in our auction rooms.
– Is the Minister for the Army aware that a committee of Liberal members of the New South Wales Parliament, including Mr. Lawrence and Mr. Doig, both members of the Legislative Assembly, has for some time allegedly been investigating gaol administration in New South Wales? Is the Minister aware that, despite extensive investigations by the committee, it has seen fit to express particular concern only for a prisoner convicted of having killed a man, and that the committee has likened this prisoner’s treatment to that of the famous “ man in the iron mask “? Is it a fact that this prisoner is being detained at the request of the Governor-General, and that the prisoner’s movements are under the control of the Minister for the Army and not of the New South Wales Government?
Is it a fact that the Minister has been under extreme pressure to grant leniency to this prisoner, despite the gravity of his offence, because some of his relatives were, or are, closely connected with the New South Wales branch of the Liberal party? Is it a fact that Messrs. Lawrence and Doig, Liberal members of the New South Wales Parliament, are evidently more concerned with securing favoured treatment for this prisoner because of political affiliations than with gaol administration in New South Wales?
– May I first express regret that such a tragedy as this should be referred to in a question in which politics are mentioned. I am sorry, too, that a member of the New South Wales Parliament saw fit to ask a question about this unfortunate and distressing matter. This case is known to many members of this House, and I feel that no good purpose is served for the family or for the prisoner by disclosing the details of it. It is true that the prisoner is in the gaol at Long Bay. I have this matter constantly under my consideration’ day by day. I feel very much indeed for the family and for the young man, but the terms of his incarceration require that some recommendation would have to be made to justify the Government or myself recommending his release to the Governor-General. Notwithstanding that all possible attention has been given to the case, I have no such recommendation in my hand at present.
– Was it a key money case?
– It is amazing how low minds can get. I hope that, in the interests of the man, no further publicity will be given to this case. Such publicity would not help. If any honorable member is interested, I am quite willing to see him personally and explain the case to him privately. That invitation is extended to all honorable members. I assure honorable members that everything possible is being done for this man in a sympathetic and humane manner.
– I address a question to the acting Minister for External Affairs. The honorable gentleman will recall that last year Marshal Voroshilov visited Indonesia. I ask the honorable gentleman whether any evidence is available which would indicate that that visit was of an anticipatory nature in order to facilitate the supply of arms and material to Indonesia. Further, I ask the honorable gentleman: What inquiries are being conducted by the Government in order to ascertain whether arms and material are being made available to the central Indonesian Government, and if so, from what source and to what extent? Finally, will the honorable gentleman assure the House that it will be kept fully informed on this issue, which has such a critical and crucial significance to this country?
– We have no information available to us as to the purpose of the visit of Marshal Voroshilov to Indonesia last year. However, it is difficult to imagine that that visit had anything to do with the incidents that are at present occurring in Indonesia. The supply of arms to Indonesia is, of course, a matter for the Indonesians themselves. We recognize the Indonesian Government. It is quite possible that it is getting arms from various places, but that is entirely within its own province. I shall make inquiries to see whether I can get any information that would interest the honorable member.
– I ask the Minister for Primary Industry: What was the amount of the meat equalization payment last year? Has any of this money been paid direct to producers or only to meat exporters? Will the Minister obtain for me information as to the disbursement of this money to each recipient?
– I cannot remember the actual amount of the deficiency payments received from the United Kingdom and passed on, I think, in full, to the Australian producers. Nonetheless, I have had inquiries made both from the Australian Meat Board and within the department to ensure that the amounts received have been or will be passed on to the producers. The best information I can get is that the amounts are being passed on. I will obtain figures for the honorable member as to the total amount of the payment. I do not think it would be practicable to obtain details of the amount paid to each producer.
– My question, directed to the Minister for Primary Industry, concerns the visit to this country of Dr. Hammond, who is regarded as probably the outstanding world authority on artificial insemination of cattle. Has the Minister been informed of Dr. Hammond’s statement that 25 per cent, of the cattle bred in the United Kingdom are bred by artificial insemination, and that as a result the quality and quantity of beef produced has increased substantially? Is it not a fact that in Australia some cattle breeding societies refuse to allow the registration of A.I. bred cattle in the stud book? Is not this arbitrary rule, made in the interests of the breeders, reacting against the producers and consumers and the national interest? If so, will the Minister direct these cattle breeders’ societies to alter their regulations on this matter, or, if he is unable to do that, will he take the matter up at the next meeting of the Australian Agricultural Council?
– I welcome the fact that Dr. Hammond is visiting Australia, mainly for the purposes of discussing the problems of artificial insemination. I was generally aware of his statement with regard to the percentage of British cattle that were bred by means of artificial insemination. So far as the second part of the question is concerned, I think that different rules apply to dairy cattle and beef cattle in the matter of registration. Whereas dairy cattle can be registered, I do not think that this is true of beef cattle. The Commonwealth has no jurisdiction in this matter; it is solely one for the State governments. However, I will do as the honorable member suggests and take up this matter at the next meeting of the Australian Agricultural Council, to see what can be done about the problem.
– I ask the Minister for the Interior: As the Department of Works is inviting tenders for the construction of two eight-story blocks of flats adjacent to, or almost contiguous with, the eight-story block of flats at present approaching completion at Braddon, will the Minister say whether this project has been referred to the National Capital Development Commissioner or is work proceeding under the recommendation of the former National Capital Planning and Development Committee? If the matter has not been referred to the Commissioner, and in view of the fact that there is a considerable body of opinion that the erection of these eight-story blocks of flats constitutes a grave blunder in planning, will the Minister consider so referring it?
– I should advise the honorable member that the National Capital Development Commission is not yet in a position to deal with matters of this kind. I should like to look into the particular circumstances of this contract before taking the matter further. There was one particular section of the contract let for a series of eight-story flats in that location in respect of which the contractor asked to be relieved of his contract. I have an idea that this particular block was in that contract. In these circumstances, the plans will have been approved by the old National Capital Planning and Development Committee, and will therefore really be a continuation of a project which had, in fact, already been commenced.
– Is the Minister for Health aware that a report was recently published in the United Kingdom to the effect that the British Government had placed gin on the free list under the health scheme operating in that country, and that doctors in the United Kingdom may now prescribe it for their patients? I ask the Minister whether, apart from the fact that this beverage is alleged to bring certain solace to the aged, or to have contributed to the downfall of Auntie, it has any medicinal properties. Will he consider including it on the list of free medicines in Australia?
– I can understand the anxiety of the honorable gentleman. I would not like to be thought of in the future as the person responsible for including in the pharmaceutical benefits lists this substance which is otherwise known, I understand, as “ Mother’s ruin “.
– I address a question to the Minister for Trade. By way of preface, let me say that I have received a communication from the Minister for Primary Industry with regard to a question that I asked last week concerning the almondgrowing industry. The communication states that the Minister for Trade referred the matter to the Tariff Board last October, but that as yet no inquiry has been made by the board. Will the Minister for Trade inform the Tariff Board of the urgency of the matter and of the plight of the almondgrowers, so that an inquiry may be expedited?
– As a result of the representations of the industry itself and of the honorable member for Barker, who raised this subject months ago, I have seen to it that the Tariff Board has been made aware of the fact that the almond industry regards this problem as being one of urgency. However, I am bound to point out that the Tariff Board is receiving applications by industries for inquiries at probably three times the rate that prevailed a year or so ago. If nothing were done about it, this would result in very substantial delays - and I do not deny that certain delays occur now. But, as I have said in the House quite recently, I have been engaged, as has the Government, in a thorough investigation to determine what can best be done to expedite the business of the Tariff Board.
– I address a question to the Prime Minister with regard to the celebrations that will be held in Queensland next year on the occasion of the centenary of the establishment of responsible government in that State. As the Prime Minister knows, the people of Queensland have been waiting hopefully for news that He» Royal Highness the Princess Margaret may be able to join them in their celebrations. I ask the right honorable gentleman, therefore, whether any news has yet been received from Buckingham Palace to the effect that Her Royal Highness may be present in Queensland during next year. If it were decided that she should come here, would it be possible to arrange that her stay in Queensland would be during the winter months, when the most pleasant climatic conditions are experienced?
– The answer to the honorable member’s question is, “ No “. Such a visit is not, in fact, in course of arrangement. That is all I can say at this moment.
– I wish to ask the Minister for Health a question without notice. In view of the refusal of the Hospitals Contribution Fund of New South. Wales to pay to many subscribers benefits due to them after their discharge from hospital, using the subterfuge that medical information before the fund indicates that the condition for which the subscribers have been treated was in evidence prior to their joining the fund, will the Minister have an investigation made into the widespread effect of the unjust and restrictive rule 9 of this organization, which deprives the subscriber of his just benefits and allows this fund to build up huge reserves at the expense of its subscribers? Will the Minister direct this organization that it must disclose the source of its information in regard to the condition of a patient prior to joining the fund, when refusing payment for treatment for that condition? Does the Minister realize that this sharp practice is causing considerable dissension and a complete lack of confidence in this organization?
– If the honorable gentleman can substantiate the charges that he makes that these actions of this fund are a subterfuge, I shall have an investigation made.
– Can the Prime Minister assure the House that there is an adequate security check on the constant flow of Communist propaganda into this country from the Soviet legation in New Zealand?
– I have every confidence in the work done by the security organization and I am sure that it is in very close touch with the matter referred to by the honorable member.
– Will the Prime Minister, as head of the Australian Government, confer with the Premiers of New South Wales and Queensland with the object of promoting the export of coal to South American and other markets? I ask the Prime Minister to aid the industry by providing rail freight subsidies in conjunction with State authorities. Because of the chronic unemployment in many mining communities and so as to augment our export income, I ask that earnest consideration be given to my proposal.
– I can assure the honorable member for Macquarie that these matters constantly engage the attention of my colleague, the Minister for National Development who, I know, is not infrequently in touch with the Government of New South Wales and, I should imagine, also, the Government of Queensland.
– In addressing a question to the Minister for Primary Industry, I refer to the announcement made by the Government last week of a reduction of 2s. 6d. a ton in the shipping freight on wheat from Western Australia and South Australia to the eastern States. I also refer to the additional moneys that have been made available by the Government to the States, especially the £1,000,000 to be divided between New South Wales and Queensland for drought relief purposes. Have these benefits been passed on to the primary producers concerned? In what way have the benefits been made available by the respective governments?
– The facts are as stated by the honorable gentleman, but, as he would well know, the method of spending the money is solely the responsibility of the State Government, and the Commonwealth does not intervene. I have seen a statement by the Premier of New South Wales as to the method of expenditure, but I am not able to state whether any part of those funds has been specifically given for the benefit of the New South Wales poultry producers.
– I ask a question of the Prime Minister in his capacity as Minister in charge of the security service. Is it a fact that the notorious German, Baron Krupp, who arrived in Melbourne a couple of weeks ago under his own name and with much publicity, recently arrived in Melbourne again secretly, and was booked into the Windsor Hotel under the name of “ Mr. Nathan “? If the Prime Minister is not aware of this, will he make inquiries? Will he also inquire into the reason for this secret visit?
– I am not aware of these allegations, and I do not propose to inquire into them. If the day comes when the Government of the Commonwealth of Australia has so little to do that it must inquire into the names under which people book themselves into hotels, and the like, we will be busy indeed. We will have to add a new jurisdiction to our responsibilities.
– I address to the Minister for Health a question about the production of Salk poliomyelitis vaccine. Western Australia’s Salk anti-poliomyelitis vaccination programme, unfortunately, came to a halt last Wednesday when the last mobile van was withdrawn because supplies of the vaccine had been entirely exhausted. It is unfortunate that this splendid programme, which has been well administered in Western Australia, should come to a halt when most of the children of the State had received their course of vaccination, and when the programme was being extended to adults. Will the Minister bring his last report up to date, and indicate the position regarding the production of the vaccine and when supplies may again be available to Western Australia - and the other States, too?
– It is correct that the poliomyelitis vaccination campaigns have come to a halt in the States. The reason is not that production of the vaccine has ceased, but that the facilities for testing it fully have been interfered with by the growth of moulds in the media used for testing. This has arisen partly from the very great precautions that are taken to ensure that no vaccine that has not been thoroughly tested is ever issued. The problem of the growth of moulds in the testing media has been aggravated recently by an extensive rebuilding and remodelling programme being undertaken at the Commonwealth Serum Laboratories, in Melbourne, in the section where the antipoliomyelitis vaccine is being produced and tested. This has further hindered the ability of the staff to produce and thoroughly test the vaccine.
It is perfectly true that these delays, which have occurred on more than one occasion, are rather exasperating, but I am sure that the honorable member will appreciate - and I hope every one else will do so - that the delays arise very largely out of the excess of caution that is exercised in order to ensure the safety of the vaccine, and that, in spite of these delays, the production and use of the Salk vaccine have already virtually banished the spectre of poliomyelitis as a threat to the child population of Australia.
– My question is addressed to the Minister for Health. The honorable gentleman is aware that, since the introduction of the medical benefits scheme, the fees of medical practitioners have been raised, without a corresponding rise in the benefits granted by the Commonwealth, or medical benefits societies. As this means that members of these societies are now expected to bear more of the cost of medical treatment than was the case when the scheme was introduced, will the Minister give immediate approval for an increase in Commonwealth benefits, and will he confer with the approved medical benefits societies in order to have benefits paid by the societies increased similarly?
– It would be an untenable position if, every time fees were raised, the Commonwealth were to increase medical benefits in proportion to the rise in fees. In fact, it appears that fees have now been stable for a considerable period, and that there is no direct correlation between fees charged and the rate of benefits. By that I mean that the fees have not risen because of the extension of medical benefits. A number of organizations have increased their share of the benefits paid, but I have encountered no widespread demand for an increase of the Commonwealth’s contribution to the fund.
– My question is to the Minister for Labour and National Service. In view of continuing serious developments on the Hobart waterfront, where registered waterfront workers are prevented from working, what action, if any, has been taken to protect the lives of the men concerned, and what is being done to ensure work for them on the waterfront? Does the action of the Tasmanian police in claiming that these men are technically disturbing the peace by appearing for work meet with the approval of the Minister?
– I rise to order, Mr. Speaker. ls it not a fact that these particular cases arc now the subject of inquiry by a court and therefore are sub judice?
– Are they before the court?
– Certain proceedings have been instituted by Mr. Hursey and his son iri the Supreme Court of Tasmania.
– 1 think it would be preferable if the Minister did not answer the question. It is out of order.
– My question to the Minister for Territories arises from a report prepared and presented by a select committee appointed by the Legislative Council of the Northern Territory to inquire into the reform of the constitution of that body in order to make the council better able to discharge its functions in the interests of the people of the Territory. In December last year, in reply to a question in this House, the Minister told me that he had received the report but that, at that stage, he had not had time to consider it. I now ask the Minister whether he has considered the report, and also whether he will tell the House what the Government’s intentions are in respect of it.
– When the report was received it was referred to the Administrator of the Northern Territory, and also to the Attorney-General of the Commonwealth, for examination and comment. The report from the Administrator has just been received, but the report from the AttorneyGeneral has not yet been received. When that report comes to hand it will be my responsibility to refer to the Government for decisis i r-.r.y matters of policy arising from either or both of the reports.
– Will the PostmasterGeneral give early consideration to the establishment of a micro-wave link between Melbourne and Ballarat in order to stimulate television reception in Ballarat which, owing to the existence of a mountain range between Melbourne and Ballarat, is at present most irregular?
– The Government’s policy regarding the extension of television to country areas has already been plainly stated by me in the House. It will be remembered that, after the initial establishment of television in Sydney and Melbourne, the Government has now embarked on the second stage of its programme, which is to permit the establishment of television stations, both national and commercial, in the other four capital cities. The extension of television to country areas forms the third stage of our plan, and will be embarked on as soon as various considerations, mainly financial, justify such action. T can assure the honorable member for Ballarat that proposals for the extension of television by micro-wave, coaxial cable or other methods is under constant investigation by the technicians and engineers of the Australian Broadcasting Control Board, the Postmaster-General’s Department and the Australian Broadcasting Commission, and that when it is possible to proceed with the further extension of television throughout Australia these methods will be considered.
– My question to the Minister for Health arises from the fact that a patient who consults a salaried medical practitioner in the Northern Territory, whose salary is paid by the Commonwealth, is entitled to receive a refund on his account, under the medical benefits scheme; but a patient in the remote areas of Western Australia who pays fees to a medical practitioner whose salary is paid by the State Government is deprived, under section 19 of the Health Act, of the advantage of a medical benefit refund. Will the Minister explain why there is this discrimination between patients of doctors whose salaries are paid by the Commonwealth and patients of doctors whose salaries are paid by a State, in view of the fact that in each case the patient must pay his account in exactly the same way as if he were being treated by a private doctor?
– The facts are correctly stated by the honorable gentleman, and this difference does exist, but it exists for a very good reason. The National Health Act lays down that payments will not be made to a State hospital or to an officer of a State hospital, the reason being that the Commonwealth makes very substantial payments to the States for hospitals and on other accounts, for instance for such things as pharmaceutical benefits. In the case of the Northern Territory, the Commonwealth carries the entire expenditure itself.
– by leave - In November last, Cabinet appointed a sub-committee, with that very distinguished citizen and soldier, LieutenantGenera] Sir Leslie Morshead, as its chairman, and the Chairman of the Public Service Board, Sir William Dunk, the Secretary of the Department of Defence, Mr. E. W. Hicks, and the Assistant Secretary of the Prime Minister’s Department, Mr. E. J. Bunting, as members, to review the organization of the Defence group of departments, and to advise Cabinet.
The committee submitted a report in December and a supplementary report in February. Its recommendations fell into two groups. In the first place, it recommended that the separate Departments of Defence, Navy, Army and Air should be amalgamated into a single Department of Defence under a single Minister for Defence.
The committee linked with this recommendation a proposal that the Minister for Defence should, because of the wide and heavy nature of his responsibilities, receive assistance from two associate Ministers. These associate Ministers would have their defence assignments in addition to their own non-defence Ministerial portfolios.
It was proposed further that the associate Ministers should be allotted duties on a “ functional “ and not a “ service “ basis, i.e. that instead of a Minister in charge of all the detailed administrative matters affecting the Navy, as we now have, another in charge of Army matters, another in charge of Air matters, there would be one associate Minister in charge of certain functions, say, personnel, for all services and another associate Minister in charge of another group of functions, say, logistics, or, briefly, military supply and material provision, for all the services.
The second group of recommendations included a variety of matters. One recommendation was that the separate Departments of Supply and Defence Production should be amalgamated into a single department, under a single Minister. Others related to various devices for improving efficiency, reducing overlapping, encouraging the development of common services, defining the responsibilities of service chiefs, and strengthening the overall authority and control of the Minister for Defence.
As I will refer to these recommendations in detail as they have been dealt with by the Cabinet, it is not necessary to set them out categorically or separately at this stage. I will, therefore, proceed to set out the Government’s decisions and, where necessary, the reasons for them.
Before doing so, I should express the Government’s great indebtedness to this very strong committee for its constructive work. Where we have disagreed with a recommendation, as we have in the case of complete amalgamation, we have done so after careful thought and only for reasons which seem to us to be compelling; as I will now proceed to explain.
We have adopted several proposals. But as we have rejected the recommendation of the Morshead committee for a complete amalgamation into one Department of Defence and the three service departments, it is important that I should state to the House quite clearly our reasons for so doing. This is the more important because we were at first greatly attracted to the idea of a single integrated department. But further consideration has convinced us that the proposed scheme would noi work if parliamentary control is to be preserved and administrative efficiency retained.
At the risk of wearying the House, I will set out as briefly as possible the considerations which have lead us to these conclusions. It is not to the point to refer to the fact that before the war there was a single integrated Department of Defence. So there was, but our armed forces were very small. The scientific complexities of defence preparation were only beginning. Munitions production was in a rudimentary stage. The overall expenditure on defence at no time exceeded, I think, £14,000,000 in a year. Rapid war-time expansion from early 1939 onwards made the creation of separate departments inevitable.
Nowadays, though we are again at peace, the problems are immeasurably more complex than they were in 1938. The forces are larger; technical problems have multiplied; munitions production is more extensive and varied; the overall defence expenditure runs in the vicinity of £200,000,000.
We are, under these circumstances, convinced that the task of overall defence political administration and responsibility is far too great for one Minister. We cannot go back to 1938. The committee recognized this. It proposed to meet it by the completely novel expedient - not adopted, so far as we know, anywhere else in the world - of having two associate Ministers!, who could deal with indicated functions or elements common to the three services. Thus, as I have said, it was suggested that one associate Minister might be made responsible for logistics and the other for personnel.
Two sets of considerations seem to us to render this recommendation impracticable, and I now proceed to summarize them. There have been from time to time proposals that assistant Ministers could and should be appointed for various purposes. Indeed, years ago assistant Ministers were actually appointed.
As I have always doubted whether such appointments are constitutionally valid, I recently asked the Attorney-General (Senator O’sullivan) to secure opinions on this point and allied points from constitutional lawyers of standing. These have been obtained and studied. To appreciate them, it is necessary to make a brief reference to the terms of the Commonwealth Constitution which, of course, bind the Government and the Parliament.
Under section 44, any person who holds any “ office of profit under the Crown “ is incapable of sitting as a member of the House of Representatives. In addition to forfeiting his seat, he is, under section 46, liable until this Parliament otherwise pro vides, to a daily penalty of £100 at the suit of a common informer. The only office of profit under the Crown which a member may take without forfeiture is that of one of the Queen’s Ministers of State for the Commonwealth.
I may say, incidentally, that that is an office of profit under the Crown. Mr. Speaker receives an appropriate emolument, not as holding an office under the Crown but as being an officer of this Parliament, which is the historic position occupied by the Speaker and the Chairman of Committees. But a member can hold an office of profit under the Crown only as one of the Queen’s Ministers of State.
Under section 64, the Queen’s Ministers of State for the Commonwealth are those appointed to administer such Departments of State as the Governor-General in Council may establish. There is room for argument as to what that may mean, but we cannot ask members to accept risks on the strength of one view out of two or three.
The opinions obtained show that it would be unsafe, to say the least of it, to appoint a salaried assistant Minister, for almost certainly such an appointment would be ro an office of profit under the Crown not authorized by the Constitution and would, therefore, expose the appointee to the forfeiture of his seat in Parliament and to the other penalties provided in the Constitution. We therefore cannot appoint assistant Ministers.
Could we safely appoint parliamentary secretaries? Again the answer is that we cannot, unless the office of parliamentary secretary is, as it is now, purely honorary. As it is not reasonable to expect members of Parliament to undertake continuous administrative responsibilities within a department without some additional compensation beyond their normal parliamentary salaries as private members, neither the appointment of an assistant Minister nor of a parliamentary secretary would offer any valid hope of easing the administrative burden of the Minister of an integrated Defence Department.
To meet this position, the committee hit on the device of associate Ministers, the validity of whose appointments would be established by first appointing them to be Ministers of State for some other department. Thus, for example, a Minister validly appointed as Minister for Works, the Department of Works being one of the Departments of State, could be named in addition as Associate Minister -for Defence. As Associate Minister for Defence, he would be assigned, say, to the logistics of the three services; he would not receive his salary in respect of the work so assigned, but in respect of his duties as Minister for Works. As there would be no department of defence logistics, he would do his administrative work in that field, not through a departmental head but through one or more of the officers in the overall defence organization.
It will be readily seen by those with experience of political administration that, under these circumstances, the position and authority of the associate Minister would be extremely ambiguous. He would be trying to deal with one stratum of the business of defence, a stratum common to all services, without that clear vertical line of authority which exists when a Minister deals with a permanent head and the permanent head deals with those through whom authority devolves to the point of ultimate action. In addition, how would such an associate Minister stand in relation to the three Chiefs of Staff who, in any conception of an integrated Defence Department, would exist in close proximity to the Minister for Defence and be primarily responsible to him?
We have, in short, such doubts of the efficacy of a scheme of associate Ministers on a functional basis that we do not feel able to accept the risks of adopting it, particularly when there is no world experience to persuade us that it will work. But there is another and very powerful reason, one which the committee could not reasonably be expected to consider in the same way as a Cabinet, or a Parliament, must. It is this: As President Eisenhower recently said in an address to Congress:
One requirement of military organization is a clear subordination of the military services to duly constituted civilian authority. This control must be real, not merely on the surface.
This statement expresses the traditional and sound view in Australia. Parliament votes defence moneys on behalf of the people who have elected it. Parliament is entitled to control that expenditure. Parliament is entitled to have, sitting in it as Ministers, people directly responsible for all aspects of this expenditure and of the policies which are being formed and operated. In brief, there must be constant and complete accountability in Parliament.
Now, let us suppose that we have a Minister for Defence and two associate Ministers - one dealing with personnel and one with logistics. True, questions could be put to either of the associate Ministers about the particular layer of inter-service matters dealt with by him. But who would answer in Parliament any question or debate in respect of service matters not included in either of those layers? Logistics and personnel do not by any means include the whole gamut of matters covered by service activities. Yet it is just on many of these points of detailed administration that questions arise in this House and members become entitled to information and to answers to criticism.
Somebody must, politically and in Parliament, be responsible. Under the “ associate Ministers “ proposal, it would be the Minister for Defence. This would mean that the Minister for Defence, who can to-day leave to the service Ministers in Parliament all detailed matters relating to the actual administration of the services, would need himself to become familiar with many of those administrative details outside the areas of logistics and personnel, details with which he need not to-day concern himself at all.
This would mean that, in order to preserve the vital principle of parliamentary authority, the Minister for Defence would have to become in part a detailed services administrator and would, therefore, have less time to consider those great problems of constant strategic thinking and overall planning which it is the vital business of the Department of Defence to deal with. In brief, the Defence Minister would find himself devoting less attention to defencepolicy, which is of the essence of his functions, and defence would suffer accordingly.
Having regard to all these considerations, the Cabinet has concluded that a complete integration of the four departments is not feasible, and that in particular the distribution of the work by the creation of associate Ministers, each of whom would of necessity have another normal civilian department to administer, could not be accommodated either to the needs of efficiency or the preservation of the parliamentary system of government.
But this does not by any means dispose of the matter. While we have, with great regret, not felt able to accept the particular recommendation of the committee to which I have already referred, we have not lost sight of the underlying considerations which influenced that recommendation. We are, like the committee, and greatly assisted by it, convinced that the present administrative structure in defence needs candid examination and, in important respects, material improvement.
The authority of the Department of Defence, which should be clear and commanding, has come to be regarded as uncertain in various particulars. The existence of separate service departments, although it has advantages, tends to make it difficult to get truly unified joint service views. Sometimes it may make those views amount to a somewhat uneasy compromise between honestly maintained but conflicting conceptions and interests.
The two departments of Supply and Defence Production have operated outside the overall authority of the Department of Defence, and this has no doubt led to a state of affairs in which there may be and occasionally has been divergence between the views of the service department’s and the two supplying departments on matters of defence supply and production. Examination shows that there may be some overlapping or duplication of services which might well be common services.
The association between the three Chiefs of Staff and the Minister for Defence, and the constant formulation by the three Chiefs of Staff of joint professional advice, both need material improvement. Administrative efficiency in the service departments themselves requires a much closer contact between those departments and the Department of Defence on the political, professional, and administrative level. We have given much thought to each of these factors. In the decisions which I will now indicate we have sought to establish or prepare for as great a measure of integration as can be obtained without a complete structural merger of four departments into one.
I will now discuss the elements to which I have just referred. I deal first with the authority of the Minister for Defence and Department of Defence. We propose to clarify this by issuing an administrative direction which will establish the complete superiority of the Department of Defence in the field of policy and which will also enable that department, by authority, if persuasion fails, to secure the elimination of overlapping between the departments and the creation wherever possible of common services and standards.
We acknowledge that difficulties have existed in securing truly joint service views, including the allocation of annual votes, for presentation through the Minister for Defence to the Cabinet. Such difficulty is easy to understand, since each Service is naturally and traditionally concentrated upon its own needs.
In addition to this, the Chiefs of Staff, though they have much contact, have probably not been called upon sufficiently to meet as such without civilian intervention, for the expression of a purely professional view on purely military matters. They have as a rule formed members of larger committees in which important non-professional considerations, either political or financial, have also been taken into account.
It is of course right that when a government gives a decision, all factors, military and non-military, should be in its mind; but it is in our judgment, vital that the Chiefs of Staff should make their military appreciations and constantly bring them up to date independently of non-military considerations, so that when subsequent meetings occur, the military view may be clearly understood, though it may and will in practice have to give way in some particulars to considerations of political policy or finance.
We have, therefore, decided that the Chiefs of Staff will in future, in addition to sitting in the other committees, meet regularly for the formulation of purely military views. In such meetings they will have at call the defence scientific advisers and others whom they may need. This should in itself produce a greater integration of military judgment than has hitherto been obtained.
But we must go further. It is not desirable that the Minister for Defence should receive military advice which represents a form of compromise between able men holding strong service views without having the assistance of an experienced and comprehensive military view singly and clearly evolved in the light of what the Chiefs of Staff have said and thrashed out in consultation. We have, therefore, decided that there should be a chairman of the Chiefs of Staff Committee who is not himself currently one of the Chiefs of Staff. He must, of course, be a military man of eminence and therefore drawn from one of the services. But his duty will not be towards his former service but to the Minister in respect of the overall defence picture. He will not in any way affect or reduce the proper authority of a Chief of Staff in relation to the affairs of that chiefs own service, Navy, Army or Air. But on the ultimate level of what I will call joint service policy and planning, he will -
While on these matters of integration of appreciations and policies, I should remind the House that, for the co-ordination of inter-service military ideas with the special knowledge of the External Affairs Department, the financial considerations of the Treasury, and the broad policy preoccupations of the Prime Minister’s Department, we already have a Defence Committee in which the heads of these departments together with the Chiefs of Staff sit under the chairmanship of the Secretary of the Department of Defence.
This Defence Committee has been in existence for approximately a year and has worked extremely well in practice. It has provided an effective means of advising the Minister for Defence and the Government on the co-ordination of military, strategic, external affairs, economic and financial factors into comprehensive policy. We propose that this committee shall continue to function with the addition of the chairman of the Chiefs of Staff Committee to its membership. Defence policy is deter mined and varied by the inter-action of the three basic elements of intelligence, resources and plans; the continuance of the Defence Committee will ensure that there is an adequate continuing review of all aspects of our national defence policy.
But the development of integrated ideas must be pursued not in one field but as far as possible in all. We have therefore decided that, while the paramount authority of the Minister for Defence is to be put beyond question, that Minister will intensify the practice of bringing into consultation the Service and Supply Ministers, so that they may constantly be informed on defence policy and be able to draw on their own departmental experience to make suggestions of an informed kind at the appropriate level.
Similarly, the permanent heads of the service departments and the Department of Supply will be in frequent consultation with the permanent head of the Department of Defence and will be, in appropriate cases, accompanied by some senior expert adviser, military or scientific. This will greatly assist common understanding and enable the necessary follow-up work to be handled more coherently and speedily.
We accept the recommendation that the Departments of Supply and of Defence Production should be amalgamated into one Department of Supply. Arrangements to this end have been in progress for some weeks and there will be no delay in constituting the new amalgamated department.
So that there may be not only at the top but at all levels a close association between the work and ideas of the services and the work and ideas of the Department of Supply, including the very important section relating to research and development, it will be made clear in the administrative direction that the Department of Supply, like the service departments, will in future operate within and subject to the general policy authority of the Department of Defence.
There is an urgent need, as the committee has emphasized to us, for the elimination of overlapping, for the co-ordinating of activities and for the development of common services. The paramount responsibility for this activity will be with the Department of Defence. For this purpose, organization and methods review will, while conducted to an extent inside each service department, flow from and be controlled by centralized machinery within the Department of Defence, the Minister for Defence being given the final authority to direct changes in procedures, the institution of common services, and such other reforms as may be brought up by investigation. The procedures are being worked out by the Public Service Board.
As the Department of Supply will under these arrangements embody one of the aspects of defence administration, the Aluminium Production Commission, which has at present only a remote association with defence, will be re-allocated to the Department of National Development.
Acting upon the views of the committee, as we have in most of what I have already stated, we have also given certain particular decisions designed to effect improvements. These are smaller matters, but I mention them.
The work of the Aircraft Maintenance Branch of the Department of Defence Production will be limited to the allocation and planning of essential production and resources, leaving the Air Force to order directly from suppliers of services and spare parts, it being understood that the Air Force will in all appropriate cases use the Contract Board machinery.
The design and inspection work of all the services will be brought together and integrated to the maximum possible extent.
The control by the Department of Defence of the research and development programme will be strengthened to provide for a more direct overall control and review of the programme and also, very importantly, to ensure that the services are more intimately associated at all relevant stages with the research and development effort.
What Ministers have decided will, we believe, greatly improve the existing position. It is quite true that it stops short of a complete structural and ministerial amalgamation which, for the reasons set out, we do not regard as either practicable or desirable from a parliamentary point of view. But our decisions should go a long way towards eliminating the disadvantages of separatism which are inherent in the present system. They should give rise to much more co-operative effort, the elimina tion of wasteful duplications, and the clear and authoritative formulation of policy; and enhance administrative speed and efficiency. All of the elements in defence will be brought more closely together. Close contacts and the promotion of common services wherever possible will tend to produce a growing integration of outlook and ideas and will tend to give a unitary significance and thus a more effective value to the total defence effort.
– by leave - No subject is more important that that to which the statement of the Prime Minister (Mr. Menzies) relates. However, many questions arise, and the sooner they are examined the better. The Prime Minister has called the Morshead committee a strong committee. The first question is: What did the committee report? We have only the Prime Minister’s comments on the report.
Sir Leslie Morshead, an outstanding fighting general of World War II. and a man of business experience, was brought in because the defence situation was becoming desperate. Over five, six or seven years, the Government had spent £1,200,000,000 or £1,300,000,000 on defence. But ground for severe criticism was found in each of the defence departments, and criticism was forthcoming. Units of the Royal Australian Navy were gradually disappearing, the equipment of the Royal Australian Air Force, in many respects, was obsolescent, and the position of the Army was worst of all. Something had to be done. When the administrative side was criticized, the Government was at last compelled to appoint a committee, and the Morshead committee was appointed. The first point which we want clarified is this: Is this a unanimous report of the committee? Is not Parliament entitled to know what is contained in the report? The report has not been produced. We want to see it; we are entitled to see it.
The second point we raise is the delay that has occurred. The appointment of the committee was announced in November, and a report was submitted in December. T gather that that report contained a most important and urgent recommendation as to whether the defence departments should be integrated under one Minister who would be responsible for the administration of the whole defence policy. If that is the fact the Government has been aware of that recommendation since December, but nothing has been done, and until now no decision has been announced. I do not know whether such a recommendation was made. We received no answer to our questions on this matter.
The statement of the Prime Minister - or the draftsman of it - gives excuses for doing nothing, but those excuses will not bear examination. The first reference was to the constitutional impossibility of appointing what the Prime Minister called associate Ministers or assistant Ministers or some other title. He dealt with three possibilities. He rejected them all. He said that he was suddenly worried about whether a Minister could be appointed to take over some of the functions of the Department of Defence as an assistant to the Minister for Defence. The Prime Minister said that he wanted to look at the constitutional position. He should have looked at it long ago! He should have looked at a Lyons Ministry, in which he was Attorney-General. He should look at the ministries in which he was Prime Minister. Apparently he did not have any doubts then.
– But he did.
– If he did, he did not refrain from acting because he had doubts as to the constitutional position. What is required by the Constitution is simply that those who perform functions of the executive Government, if they are members of Parliament, must be Ministers of State. They may have a portfolio, but they need not have a portfolio. The Constitution does not require that they must have a portfolio. The Constitution is satisfied if they are Ministers of State. If they are given certain duties, that is simply a division of functions. I am certain that that is the proper interpretation of the Constitution. My colleague, the Deputy Leader of the Opposition (Mr. Calwell) has shown me two lists of Ministers. The first refers to the Lyons’ ministry of 1938, and the second to the Menzies’ ministry of 1938. In each of those ministries, Ministers without portfolio were appointed. I am quite certain that they were paid. One such Minister was the gentleman then called Mr.
Spender. We can certainly assume that his service was not honorary. The Minister for Defence (Sir Philip McBride) was another Minister without portfolio. I am certain that he was paid. Another was the present Leader of the House (Mr. Harold Holt). Certainly he was paid. What would have happened if the constitutional validity of those appointments had been challenged? We also had assistant Ministers in the Labour government. It is all perfectly valid and constitutional.
This excuse about constitutional difficulties is something dredged out of the ocean so that the Government can say, “ This might stop our critics; this might help us to get out of this recommendation “. Why do not the Prime Minister and the Government face up to this situation without raising these unsound technical points? Of course, the Prime Minister did not act only on his own view of the constitutional position. That would have been quite good enough, but apparently he has gone around to find out whether others support him. He has not acted in accordance with the practices that have existed in this country for half a century. That means that he did not want to adopt the Morshead recommendations. Unfortunately for the Morshead committee, somebody suggested the name “ associate Minister “. When that was suggested, some one else pounced on it and said, “ We cannot have an associate Minister. That is terrible and is anti-constitutional. It is quite subversive.” If only Sir Leslie Morshead had said, “ Let us see what the Menzies Government of 1938 did” he would have used different language and said, “ Minister without portfolio “. Of course, the real point, as I think everybody will agree, is to get the man in the Cabinet for the job - not to fix a framework of jobs and functions and then see who can perform them. I do not want to embarrass any holder of a service portfolio by saying that; because it is not cricket to do so - at any rate, not this afternoon. My time is very limited, but I point out that it is necessary to get the man for the job of Minister for Defence who can do it. It is very difficult to decide who that man might be. when one looks around the Cabinet. I say nothing about the back benchers. During the war the late Mr. Curtin was both Prime Minister and Minister for Defence, lt may be that you could get the right person to do that and, if so, he should be really responsible for the whole functions of defence.
In England, although there are separate Ministers, there is hot much concern about the precise descriptions of those Ministers; they do not worry about the precise descriptions of the jobs they will fill. I have in my hand a paper which describes the activities in which the British Minister for Defence and the Defence Department are engaged. This is the policy, stated on behalf of the Government in England by the Minister for Defence, Mr. Duncan Sandys. The paper was printed in April, 1957. It outlines the matters dealt with by the Department of Defence and its Minister, subject, of course, to overriding Cabinet responsibility. That must be remembered. It has not been mentioned by the Prime Minister. The Minister for Defence will not decide these matters individually or personally. He will have to get approval of policy from the Cabinet. I shall quote various headings from the Sandys report -
Need for new approach - Scientific advances - Demands on economic resources - Britain’s responsibilities - Collective defence. 1 ask honorable members to note that there is no distinction in the subject-matters between what is foreign policy and what is naval, air or army policy. They are all dealt with in the same report. Further headings are -
Nuclear deterrent - Defence of the deterrent - Civil defence-
Civil defence - that would give the present Ministers quite a start. Other headings of the report are -
Europe and the Atlantic - Middle East - Far East - Overseas garrisons - Sea power. - and so on. This report deals with the whole gamut of the defence of the country, for which the Government and no one else is responsible, and the extent of the responsibilities of the Ministers for Defence in England. If it is possible to get the man for the job - it might have to be the Prime Minister
Opposition members. - No!
– I am not dealing with this Government; I am stating the general proposition. It might have to be the Prime Minister, or it might be someone without any particular experience in the Services. I should have thought that that would be the way to tackle this matter. Surely, Sir Leslie Morshead knew something about how it would run. He might have known something of the Department of Defence, although he was not a staff officer but a citizen. And he was a great fighting, general in the same sense, as were our other great generals such as Sir John Monash, Sir James McCay, Sir Granville Ryrie, SirJohn Gellibrand, Sir Ian McKay, Sir Leslie Morshead, Sir Edmund Herring and General Gordon Bennett-
– Also Wentworth!
– I take it my colleague refers to the honorable member for Mackellar (Mr. Wentworth) with whom we on this side of the House have had many contests over many years. But I will say this: In spite of the fact that we think he is usually wrong on the subjects he takes up, certainly he has got that energy and drive which, perhaps, would be a pleasant surprise to any government. I am not talking about the Government with which the honorable member is now associated; I amspeaking in abstract terms.
I submit that this is quite an unsatisfactory report. It does not propose an integrated Department of Defence. It suggests that it is not possible to have one now onthe ground that there was one before the war. But that is no reason why there should not be one now, after the war. The question of having one depends on the circumstances. The report suggests also that it is not possible to have an Assistant Minister because that would be unconstitutional. 1 say that that is constitutional nonsense.
It is also suggested by the Prime Minister that it is not possible to have a Parliamentary Secretary unless he is quite honorary; but if the Government wants to promote a back-bencher to do work of an executive character, the course is the same. He is appointed a Minister of State; the Parliament fixes the number of Ministers. There is no limit in the Constitution to that number, and when an appointment is made the salary is voted by Parliament. Therefore, unless the Government is determined not to use the name “ Parliamentary Secretary “. action could be taken by appointment of an honorable member as Minister of State.
Now we come to the faux pas of the committee - the alleged blunder it made in using the term “ Associate Minister of Defence “. There is nothing wrong with the name; he would become a Minister of State assisting the Minister for Defence. There is nothing illegal or unconstitutional in that. The honorable member so appointed may have had experience of Service work, as two or three of my colleagues have had.
I suggest that all this argument of the Prime Minister is simply an excuse for not doing what otherwise might be decided upon. Further, when the Government passes that over, it gives a most extraordinary reason. The Prime Minister suggests that if an attempt is made to divide the work of the Assistant Minister for Defence, or of the Minister without portfolio assisting the Minister for Defence, regard will have to be paid to so-called “ vertical “ and “ horizontal “ functions, as though the Constitution provides how the work shall be divided. That reasoning is so full of words and so devoid of substance that it convinces nobody.
Something is to be done. The old Departments of Supply and Defence Production may be united, and they may be under the Defence Department. I invite honorable members to listen to the Prime Minister’s words -
We have given much thought to each of these factors. In the decisions which I will now indicate we have sought to establish or prepare for as great a measure of integration as can be obtained without a complete structural merger of four departments into one.
But that is not the purpose of the recommendations. It is possible to do away with the value of separation of responsibility and fail to get the unity that could be obtained through one Minister for Defence assuming full responsibility. The Government then asserts the complete superiority of the Department of Defence in the field of policy, but that is not correct. In the field of policy, the Department of Defence ultimately has to come to the Cabinet in great matters. Matters of policy are essentially matters for the Cabinet. I submit that this proposal needs explanation because in its present form it is quite unsatisfactory.
Then comes the idea of having greater efficiency and simpler co-ordination. But what is proposed? Evidently it is not sufficient to have three Chiefs of Staff; the
Government wants a fourth Chief of Staff. He will be chief of the Chiefs of Staff. And lest he be too much trouble in Australia, he will be sent to overseas military conferences. I suppose the Government has somebody in mind for this post. I do not know who it will be. It might be the admiral whose name was mentioned during the debate on the St. Mary’s filling factory. Who is it to be? We cannot judge the value of such an appointment unless we know who is to be appointed. The Government might get some commanding genius in the Navy, Army or Air Force. But one would think that the person for this job would be the chairman of the Chiefs of Staff; but three would be enough. But the Prime Minister says that these people would have to thrash these matters out. The Government will not permit dissenting reports from the Chiefs of Staff. They must hammer out their problems themselves. There must be no dissent; they must bring their compromise report - as probably it would be - to the higher level. That again, will be unsatisfactory. What a wonderful system it would be!
This statement by the Prime Minister does not get the Parliament anywhere, and if the back-benchers on the Government side are satisfied with it, after continued agitation over long periods, they will be satisfied with anything. I have told the House how the system operated in England. I have not given actual names or even the titles of portfolios, because the Service Ministers in England cover more than one portfolio. But in that country onesees the result that is illustrated by the Sandys’ report.
To make good what I have said about the criticism of the Government, let me say that on 14th November, two days before the announcement concerning the Morshead committee, there appeared in the “ Sydney Morning Herald “ a summing up of the Government’s record on defence.
– Your official journal!
– No, not official. There is, of course, no substance in the quip of the Prime Minister. The question is whether the facts contained in this newspaper report are accurate. If so, they constitute a striking indictment of the Government’s defence administration, for which there has been no precedent in Australian history except on one occasion. That was when the defence record of the Menzies Government was given by Mr. Curtin in his policy speech in 1943. He gave the facts to the people of Australia. He told the people what his Government had available for the defence of Australia when it succeeded the previous government. I shall not go into the matter in detail, but the facts may be found in the record of Mr. Curtin’s 1943 policy speech. The equipment that was available at that time for Australia’s defence was completely inadequate in every respect.
– If the Leader of the Opposition wants an argument on that matter, let us not have it on this occasion.
– Why not? The Prime Minister can have it in the next debate if he wishes to. I submit that the position with regard to equipment, when this committee was appointed, was most serious. We do not know what is in the committee’s report. We demand its production. The committee might have had reasons for its findings quite unrelated to what the Prime Minister has said. As far as I can see, the general plane of the committee is a sound one; that is, to have one Minister for Defence, with assistant Ministers, who will perhaps deal each with particular services, or who may have their functions allocated in a different way.
We get reports of this nature on defence every three or four months. They are never given to us by the Minister for Defence (Sir Philip McBride), but always by the Prime Minister. This statement is completely unsatisfactory, and it gives no guarantee of any improvement in our defence position, which is unsatisfactory in respect of the three services. When we can have a full debate on the matter all the facts must be looked at to see whether this Parliament can give some direction on the matter which will help to improve our defence position. During the term of office of this Government £1,200,000,000 has been expended on defence. Where are the ships? Where is the air force? Where is the army?
– Where is the money?
– That has gone. The people have lost that £1,200,000,000. Nothing like this has happened before in the history of Australia. It is very serious. The report of the Morshead committee should be made available to us, and the comment of the Prime Minister can then be seen for what it is worth. I think it is a worthless comment.
14.91. - I move -
That the following paper: -
Defence Organization - Ministerial Statement, be printed.
I ask for leave to continue my remarks at a later stage.
Leave granted; debate adjourned.
Reserve Bank Bill 1957. Commonwealth Banks Bill 1957. Banking Bill 1957.
Banking (Transitional Provisions) Bill 1957. Audit Bill 1957.
Commonwealth Employees’ Furlough Bill 1957. Crimes Bill 1957.
Gold-Mining Industry Assistance Bill (No. 2) 1957.
Income Tax and Social Services Contribution
Assessment Bill (No. 2) 1957. National Debt Sinking Fund Bill 1957. Northern Territory (Lessees’ Loans Guarantee)
Officers’ Rights Declaration Bill 1957. Re-establishment and Employment Bill 1957. Sales Tax (Exemptions and Classifications) Bill (No. 2) 1957.
Suspension of Standing Orders.
Motion (by Mr. Harold Holt) put -
That, in relation to the proceedings on the following bills, viz., Reserve Bank, Commonwealth Banks, Banking, Banking (Transitional Provisions), Audit, Commonwealth Employees’ Furlough, Crimes, Gold-Mining Industry Assistance (No. 2), Income Tax and Social Services Contribution Assessment (No. 2), National Debt Sinking Fund, Northern Territory (Lessees’ Loans Guarantee), Officers’ Rights Declaration, Re-establishment and Employment, and Sales Tax (Exemptions and Classifications) (No. 2), so much of the Standing Orders be suspended as would prevent the Minister for Labour and National Service making one declaration of urgency and moving one motion for the allotment of time in respect of all the bills together.
The House divided. (Mr. Acting Deputy Speaker - Mr. W. R. Lawrence.)
Majority . . . . 22
Question so resolved in the affirmative.
Declaration of Urgency.
– I declare that the following bills are urgent bills: -
Reserve Bank Bill 1957, Commonwealth Banks Bill 1957, Banking Bill 1957,
Banking (Transitional Provisions) Bill 1957, Audit Bill 1957,
Commonwealth Employees’ Furlough Bill 1957, Crimes Bill 1957,
Gold-Mining Industry Assistance Bill (No. 2) 1957,
Income Tax and Social Services Contribution
Assessment Bill (No. 2) 1957,
National Debt Sinking Fund Bill 1957,
Northern Territory (Lessees’ Loans Guarantee)
Bill 1957, Officers’ Rights Declaration Bill 1957, Re-establishment and Employment Bill 1957, and Sales Tax (Exemptions and Classifications) Bill (No. 2) 1957.
Question put -
That the bills be considered urgent bills.
The House divided. (Mr. Acting Deputy Speaker - Mr. W. R. Lawrence.)
Question so resolved in the affirmative.
Allotment of Time.
– I move -
That the time allotted in connexion with the bills be as follows: -
For the second readings, until 9.30 p.m., this day.
For the committee stage, until 10.10 p.m., this day.
For the remaining stages, until 10.20 p.m., this day.
I think that honorable members who have in their minds the earlier procedure in Parliament on the banking legislation, and who have followed the proceedings so far in the present debate on that legislation will agree that although the time which has been allotted might under ordinary circumstances be regarded as unreasonably short, in the present circumstances it is quite adequate to meet the purpose of this particular Parliament, in session. It is quite apparent from what has gone on in the course of the second-reading debate already that honorable gentlemen opposite have no continuing interest in the discussion at the secondreading stage. Quite obviously, last night, they themselves were wearied by the tedious repetition which was going on of issues which had been thrashed out earlier.
When the honorable member for East Sydney (Mr. Ward) on one occasion, felt it it necessary to draw attention to the state of the House, only six members of the Labour party were present in the chamber. Quite obviously, the Opposition was uninterested in the further conduct of the debate. Shortly after the quorum had been formed it was seen that only five members of the Labour party had remained to hear further discussion take place. It cannot be seriously argued that the Opposition is not going through the form of protest on this occasion merely for the record. Already valuable time which could have been devoted to the debate has been wasted.
I have no doubt that the Deputy Leader of the Opposition (Mr. Calwell) will go into the sort of song and dance act that can generally be expected from him on occasions such as this, and flog himself into a synthetic rage. But nobody will really be misled by that performance. If Opposition members really wanted the length of time that their votes already taken on this pro cedure would indicate, it is surprising that they did not take advantage of the opportunity that their fellow members in caucus had when the legislation, passed without amendment by this House, was transmitted to another place. What a mockery it becomes when we have a protest here against the time allowed for debate on this legislation, and the Senate, which, under the Australian Constitution, is intended to be a house of review, has not, on account of the weight of Labour representation there, carried through even the motions of debate on issues sent up by this House for consideration in that place!
If Opposition members want further time for the consideration of these measures, the other House, I suggest, is the place where time can usefully be taken up in debating these bills. It is a house of review, but, so far, on these issues, it has demonstrated itself to be merely a house of frustration. My colleagues in the Government, Mr. Acting Deputy Speaker, are completely willing to make adequate time available in the Senate for debate on these measures, which it has not yet debated. We in this chamber, on the other hand, have considered these bills at great length. We have passed them without amendment, and a mere repetition of the earlier debate would simply waste the time that this House needs for the conduct of other pressing business. So, I suggest to the House that the time now proposed will be more than adequate to enable the Opposition to indicate where it stands, and, at the same time, will be adequate to bring the legislation to a point at which it can be submitted to the house of review for a second time.
Mr. ACTING DEPUTY SPEAKER.Order! The Minister’s time has expired.
.- This House has never before had to submit to such a pathetic effort as that to which it has been subjected by a putative Prime Minister. If that is the best that the Leader of the House (Mr. Harold Holt) can show us in the way of debate and leadership, let us hope that the country will have reason to welcome the advent of the new honorable member for Parramatta (Sir Garfield Barwick). The Leader of the House has entirely misrepresented the position. He has dealt at length with what is to be done in the Senate. He knows full well that these measures would have been debated when they were last presented to the Senate, had it not been for the ghoulish action of his colleagues in refusing a pair to a very sick man, a man who had been operated on only eight days earlier for a serious illness, and was at that time in danger of death. The Government wanted to snatch a victory by pushing through its miserable, contemptible legislation, and denying a very sick senator his right to cast a vote.
Now, emulating Uriah Heep, Ministers pretend that they are so humble about it all, and that everything would be all right if our Opposition colleagues in another place would be reasonable. But we have the numbers in another place, and we intend to use them, and all the Government’s pretence and humbug will avail it nothing. The first four of these bills will be defeated in the Senate on Thursday of next week. It will then be up to the Government to say what it wants to do. It will prove to be as vacillating and as pusillanimous on this issue as it proved to be on the defence issue. It will run away from this problem as it has run away from other problems.
To return to the particular motion, what does the Government propose to do? It proposes to allow the House to debate four important bills - which are supposed to put the whole banking structure on a proper and sound basis, but, in truth, will hand over the Commonwealth Bank of Australia to the tender mercies of the private banks - with only three hours and ten minutes for the second-reading stages.
– For the second time!
– They were discussed all day yesterday.
– We should like to discuss them a dozen times in order to expose this Government before the Australian people. And we should like to expose the hill-billies, too. They reckoned that they were getting something wonderful out of this bill in the way of a development bank, and so they signed up to support all the bills on the strength of a promise that they would get such a bank. The honorable member for Fremantle (Mr. Beazley) summed up the members of the Australian Country party very well, Mr.
Acting Deputy Speaker. He said that they are always prepared to capitalize their gains and socialize their losses. They think that there is a bit of socialism in the proposed development bank.
Mr. ACTING DEPUTY SPEAKER__
Order! The honorable gentleman is not now speaking to the motion before the Chair.
– I admit the soft impeachment, Mr. Acting Deputy Speaker. But I am only a little further away from it than the Leader of the House was.
– The honorable member is not dealing with the motion at all.
– It is all very well for the outgoing Minister for Defence (Sir Philip McBride) who doubtless cannot make up his mind at this stage whether he is coming or going.
The Government proposes to allow twenty minutes for the consideration of about 300 clauses in committee. Yet Government supporters talk about democracy and their respect for democratic institutions! For the remaining stages of the bill, a further ten minutes are to be allowed. Can the Government really spare that ten minutes? It is a wonder that it does not want to cut that down to five minutes, or even less.
Order! The honorable gentleman’s time has expired.
14.32]. - The Deputy Leader of the Opposition (Mr. Calwell) has worked himself into a fine fury, and has indulged in a great deal of sarcasm about a matter on which the Opposition has displayed what is clearly revealed as a sham resistance. He knows quite well, as does every one else in the country, that this House, in a previous sessional period, has already debated these measures at some length and considered them with some care, and that they have been re-introduced because they were rejected in another place. It is rather contradictory on the part of Opposition members that, whereas, on a previous occasion, they were most unwilling to allow another place to debate these measures at all, and used every device available to them to prevent any debate in another place, they are now pinning their faith on a debate in that other place. The contradiction, of course, becomes more evident when one recalls that the Australian Labour party, which now, in the words of the Deputy Leader of the Opposition, is going to debate with great keenness every stage of these bills in another place, is dedicated, as laid down in its own platform, to the abolition of the Senate. The place that it says is of no use, the place that it says should be wiped out, is now upheld by the party as the place where a principal debate should take place. But the emphatic point to be made here - and to be made quite clearly - is that this House has already, during a previous sessional period, had ample opportunity to debate all these measures, and has in fact debated them and passed them, and it is only because they were rejected, without even a hearing, in another place, that it has been necessary for the Government to re-introduce them.
Why should we prolong the debate? We had a debate yesterday on this and, as 1 think has already been mentioned, during one period of that debate the Opposition benches were so denuded of members that they looked like the bones of a picked fish. There were five members there - a mere skeleton of a party which is supposed to be pledged to fight these bills to the utmost. Five of them, the embodiment of weariness, the embodiment of lack of interest, were sitting on those benches during a period of the debate on these important measures. Now, when they have in front of them & further few hours for debate, honorable members opposite prefer to use up some of that time in resisting this motion, rather than in getting on with the business. I venture to predict that at some period during the remainder of to-day’s sitting we shall again find the Opposition benches just as empty, just as weary, just as dispirited as they were yesterday, but at the same time we shall have the leaders of the Opposition party spiritedly professing that these are great measures on which they would like endless time for debate, on which speech after speech should be made; and while they are saying this there will be few of their supporters present to listen to them.
.- I think that the Deputy Leader of the Opposition (Mr. Calwell) summed up the Government’s attitude to this question of the allotment of time when he said that the members of the Government treat the House with so much contempt that they propose to allot only twenty minutes at the committee stage for the discussion of about 300 clauses of this far-reaching legislation. As if to show further their contempt for the House they put a Minister of Scottish descent in charge of the House. In other words, nothing is to be let go.
We know why the Government wants little debate on these measures. It is because honorable members opposite know that the legislation spells their political doom, and they are seeking to curtail the just criticisms which would undoubtedly come from this side, and which would shoot from his ejector seat the honorable member for St. George (Mr. Graham).
These fourteen measures have been declared urgent measures. In them are provisions for changes in the banking structure which will enable the private banks to dominate and control the people’s bank of this Commonwealth. The legislation has already been rejected in another place and, undoubtedly, will be rejected again. But the Minister in charge of the House, the Minister for Social Services (Mr. Roberton), and the Minister for Territories (Mr. Hasluck) have told us that we are to have the minimum of time to discuss these farreaching measures. Why? Simply because the Government is ashamed of the legislation. It is not prepared to allow the legislation to be debated fully in this Parliament. There are months of the year available to the Government for parliamentary sittings, but no sittings are held. The Government keeps the Parliament more in recess than in session, even though in the short period that the Parliament sits it brings before us highly contentious measures like the present legislation, which should be debated fully.
We have not heard the Treasurer (Sir Arthur Fadden) speak on this curtailment of the time for debate. He knows the importance of these measures, and he did not say, as the Minister for Labour and National Service said, that twenty minutes was sufficient time for the debate at the committee stage. When Labour was in office we gave endless time for discussion on all important matters. There was no curtailment of the right of the individual to speak when matters of great interest were before the Parliament. When Labour submitted the bank nationalization proposals to the Parliament honorable members were given adequate time to discuss them. In fact, the greatest number of speeches ever made on one issue was made on the Labour Government’s bank nationalization proposals.
What has the Government to be ashamed of? Why does it fear the criticism of the Opposition on those measures? Why does it not accept constructive criticism? Why does it not accept amendments to the legislation, if need be? I will sum the matter up by saying that the Government is ashamed of these bills, and frightened of their effect, political and otherwise. The debate is also to be curtailed because the banks which control this Government - its Ministers and its supporters - have ordered that there is to be a minimum of discussion on the legislation.
The Minister for Territories said that there were only five Labour members in the House during a period of the debate yesterday. I was here, and I can say that on many occasions the number of Labour members on the benches was in excess of the number of Government supporters. It is a well-known fact that the Minister for Territories is so seldom in the House that it is doubtful whether he would know whether or not there was a quorum. That kind of talk will get the Government nowhere.
The fact of the matter is that the Government fears debate on its proposals. Indeed, the Government restricts debate on every possible occasion. It brings the Parliament together in Canberra as a kind of social gathering, and does not give it enough time to debate important matters. I do not know why the Parliament should not meet for unlimited periods so as to give every member ample scope to discuss important measures, such as these measures with their great number of clauses. But the Government rushes the Parliament into recess when it can, restricting the rights of members. The Government would be better occupied if it gave us time to discuss its proposals and bring out to the public view all the implications of this legislation. On the last occasion when these measures were before us the Government guillotined them through the committee stage, and it is attempting to do the same thing to-day. It should be ashamed of its action. I join with the members of the Opposition who criticized the manner in which these measures are being guillotined through without sufficient discussion.
Mr. ACTING DEPUTY SPEAKER.Order! The honorable member’s time has expired.
.- When I listen to members like the honorable member for Graydler (Mr. Daly) and the honorable member for Melbourne (Mr. Calwell), I find it difficult to realize that they are the same men I heard speak on similar subjects, during the regime of the Chifley Government, from the Government side of the House, when they were in office and were using the guillotine and the gag. The honorable member for Melbourne said on those occasions that the then Opposition were given adequate time for debate. The “ Hansard “ records show that under the Labour government debate was cut to the minimum, and that bills containing many clauses had to be debated at the committee stage in a very limited time.
Now, had these measures been introduced for the first time in the present session, the position would be entirely different. But the bills were discussed fully in the last session, and everybody knows that further discussion of them now is sheer repetition, which is becoming very boring not only to honorable members, but, surely, to the outside public who hear the debates on the radio or who read “ Hansard “. It is about time that the debate was closed, and I compliment the Minister for Labour and National Service (Mr. Harold Holt) for applying the “ guillotine “ on thisoccasion, because there is a rule in this House against tedious repetition, and the speeches we have heard in this debate are surely that.
Mr. ACTING DEPUTY SPEAKER.Order! The time allotted for the debate on the motion for allotment of time has expired.
Question put -
That the motion (vide page 444) be agreed to.
The House divided. (Mr. Acting Deputy Speaker - Mr. W. R. Lawrence.)
Majority . . . . 15
Question so resolved in the affirmative.
Debate resumed from 18th March (vide page 418), on motion by Sir Arthur Fadden -
That the bills be now read a second time.
14.49]. - As the House already knows, there are fourteen bills connected with banking for consideration in this chamber. It is a most formidable array, but I believe that the chief purposes of the fourteen bills may be reduced, for all practical purposes, to two. The first of these two chief aims and objectives is the establishment of a Reserve Bank, confined in its activities to central banking purposes alone. The second is the establishment of a Com monwealth Banking Corporation, to include the Commonwealth Trading Bank, the Commonwealth Savings Bank, and the Commonwealth Development Bank. The Commonwealth Development Bank is designed to include the present Mortgage Bank Department and the Industrial Finance Department of the existing Commonwealth Bank.
There was a time when the Australian Labour party shared the views implicit in these purposes and intentions. But the Australian Labour party has changed its traditional character in the last few years, and now we have the extraordinary situation of the Australian Labour party not only rejecting in this chamber proposals designed to help the people of our country, but also refusing in another chamber to discuss them and their merits. Let me say that a great many Australians believe that a free and competitive banking system is vital, and, indeed, fundamental to democratic society; and I am one of them. There are people who believe that without a free and competitive banking system we cannot have democratic society, as we know it and have known it,” and these people are to be found in all walks of life. Indeed, they are to be found in the Australian Labour party to-day, and in the past that belief was held by no less than two Australian Labour party Prime Ministers - Messrs. Curtin and Chifley - and one Australian Labour party Treasurer of the Commonwealth, the late E. G- Theodore. We believe that without a free and competitive banking system democratic society cannot hope to survive.
There is a great deal of history behind that belief. It is not just an idle speculation. In the last few years it has been confirmed in a great many countries, in a great many parts of the world. If we doubt it, it is our business to inform ourselves on that point. Wherever a free and competitive banking system has been destroyed, democratic society itself has been destroyed, the people have lost their liberty and, indeed, their democratic conception of human dignity. That is our experience; so for a great many people this question of banking is a matter of faith and conscience.
It is wrong, in my opinion, to suppose that there is anything sacred about the banking system, that the system, having been evolved, it is not competent for any person to alter it in any shape or form. The banking system, as we know it, has never been fixed or irrevocable. It was conceived in the minds of ordinary men and women like you and me, Mr. Acting Deputy Speaker - if I may use the expression - to serve ordinary men and women like you and me, and there its function begins and ends. It is purely a service system and it has no other purpose. At no stage in our history or in the history of any other democratic country has the banking system been fixed and inflexible. It has always offered a challenge to the intelligence of the people it was designed to serve. Intelligent people throughout the world have always accepted that challenge, and that is our position to-day. Whatever in the past faults, frailties, and flaws in our banking system have been demonstrated in actual practice, the Australian people have accepted the challenge to their intelligence. They have accepted their democratic responsibilities and they have amended or altered the banking system. They have, I believe, constantly improved it until it has measured up, from time to time, to the changing circumstances of modern society. Is it suggested that this age and generation should reject that challenge? After more than a century of gallant banking history behind us, is it suggested that we have reached the end of the road and that it is beyond the wit and the ingenuity of this generation to improve a system that was devised to serve the people? I could not subscribe to that idea for a single moment.
So long as we have people - men and women alike - who are willing to engage their energies to provide in excess of their own immediate physical needs, a free and competitive banking system is necessary to provide opportunities for the gainful employment of their accumulated resources. Might I be permitted to give simple demonstrations of that axiom? There is the person who engages his or her energies in earning a wage or salary in the normal way. If those persons confine their activities to what is necessary to meet a bare minimum of their physical needs, quite obviously they cannot accumulate savings; but if they engage their energies in excess of a basic minimum, quite obviously they must accumulate additional or unused resources. To keep them idle about the place is surely the wrong thing to do. To gainfully employ them is the correct thing to do, and the banking system was devised by those very people for that very purpose.
Similarly, there is the producer who is in production. If he confines his production to that which is necessary to keep him and his dependants alive and stops at that, it is a negation of democratic society. But if he engages in production for the purpose of providing for his own needs and the needs of his dependants and in excess of that, then he needs some sort of commercial organization to dispose of his surplus production no matter what it might be. Admittedly, the wheat-grower could confine his production to basic minimum quantities of wheat for his own needs, but because he engages in democratic production and produces in excess of his needs, he requires to have commercial mechanisms to dispose of his accumulated surpluses of production, and he needs institutions and organizations that will gainfully employ the proceeds therefrom. The same argument, of course, can be applied to all forms of production. If a man produces a machine and leaves it at that, the problem is simplified; but as soon as he produces more than one machine, then he needs some sort of organization to cope with the situation that must inevitably arise.
I have to say, in connexion with the argument which has been submitted by the Government on the one hand and which is being bitterly and violently opposed by the Opposition on the other hand, that, in the beginning, we adopted the conventional banking system of the period. I. suppose it has served us reasonably well, but at no stage were we satisfied with if. The conventional banking system of the time provided for the banking organizations to use their share capital for traditional banking purposes - to augment their share capital with the funds of their depositors, no matter who or what they might be, and to provide credit facilities and resources up to what the banking organizations themselves considered to be within the limits of reasonable risk.
That was the banking system we began with, and it has served us reasonably well; but this was a young country with unlimited potentialities, and, because of that, the banks were encouraged to engage in banking business that involved hazards too great for the conventional banking system to bear if and when anything went wrong. Unfortunately, due largely to the vagaries of the climate and to our lack of population, things did go wrong on a number of occasions.
The Australian people, faithful to their trust as democrats in a democratic community, bent themselves to the task of improving the banking system to meet those circumstances and to avoid those hazards.
To that end, we established banking systems and banking organizations of our own, hopeful that those organizations, subscribed to by Australian people, would be better fitted to measure their operations against the difficulties that are inseparable from production in our country. For example, after the 1892 economic disaster which lasted until 1895, the Australian people manifested in a number of ways the need and desire for a banking system that would free itself from the hazards that precipitated that crisis. Again they bent themselves to that particular task. As a result, we find in our social history that the conventional banking organizations of that period withdrew from the more hazardous forms of business.
The traditional banks of the period withdrew, for example, from speculative land investment. There was a time when all banks operating in our country were prepared to lend on broad acres on terms which encouraged and induced speculative land investment; but the Australian people said, “ We have had experience of this kind of banking and it has visited disaster on a great many people. For that reason, there ought to be a contraction from speculative land advances “. So they demanded that the trading banks withdraw from that kind of hazardous business. As they withdrew, of course, they created a vacuum, and into that vacuum came the land investment companies which were set up for that very purpose and, I have no doubt, were financed by the banks for that purpose. They were designed to fill the vacuum that was created as the trading banks of the period abandoned speculative land finance.
The Australian people themselves said that speculative live-stock investment was the kind of business that no reputable bank should undertake beyond certain fixed risk limits. So our trading banks withdrew from the speculative live-stock investment business and, again, they created a vacuum. Then those organizations which came to be called the stock and station companies moved in to cover the field that had been vacated by the trading banks. Admittedly, they were financed in part by their shareholders and in part by the trading bank institutions when they undertook these hazardous responsibilities, and to that degree they rendered the trading banking system of the period that much safer. The same thing applies to a wide variety of banking business. The speculative builder, and the organizations engaged in speculative development at one time were financed by the trading banks, but because of the bitter experience of the past the public required the banks to leave that field of business to other people. So, we have organizations set up for purposes of building, and set up for purposes of advancing developmental projects of every kind. The demand for safety created vacuums in our banking system, and those vacuums were filled by other organizations.
But that was not the only movement. Simultaneously, a need for additional banking facilities was arising. For example, the trading banks had no savings bank facilities. So, all the States in turn set up, in a variety of ways, banking organizations for that very purpose. There were savings banks in all six States. Then, as the trading banks’ withdrew from the hazards of speculative land finance, the States discovered that they needed supplementary banking organizations to provide the resources necessary for the agricultural and pastoral occupation and development of our country. So again, in all six States, organizations were set up for that peculiar kind of business. They were variously called agricultural banks, primary producers’ banks, rural banks, and other names of that type. They were intended to fill a very real need, a vacuum created by the demand for security coming from the Australian people and the movement of the traditional organizations away from certain speculative fields of finance.
In the normal evolutionary process, so far as banking is concerned, we got to the point where the people themselves conceived the idea that a Commonwealth Bank was necessary. After much political travail, a Commonwealth Bank was ultimately established. Whatever the original intentions were - and they are the subject of a variety of interpretations - it is clear to me that the Commonwealth Bank was not designed in the first place to discharge the functions of a central bank or to control the economy, but to provide credit facilities for developmental purposes and to engage in normal banking business. Nobody took the slightest exception to that. Indeed, everybody thought it a splendid idea to have another free and competitive banking organization. The Commonwealth Bank was intended to compete; it was never intended to control or to dominate. If my interpretation is to be doubted, may I fortify it by referring to the remarks of the late Mr. E. G. Theodore, when he was Treasurer, during his second-reading speech on the Central Reserve Bank Bill in 1930. The purpose of the bill was to create a new central reserve bank in Australia, absolutely separated from the trading activities of the Commonwealth Bank of the time. Mr. Theodore said -
There are some who, while approving of a central reserve bank for Australia, think that we ought to allow the Commonwealth Bank gradually to become such a bank. They consider that there is no need to set up such an institution as the bill outlines. In answer to them, I can only point out that the Commonwealth Bank was established by its founders, and was carried on for a number of years, with an objective quite different from that desired in the establishment of a central reserve bank. The Commonwealth Bank was intended to be a trading institution, and to operate freely in competition with the private trading banks Subsequently … an attempt was made to enable it to develop into a central reserve bank; but it has not succeeded in fulfilling the functions of such an institution, and cannot be regarded as a central reserve bank.
Surely that is evidence that as far back as 1930 the Labour party recognized that a central reserve bank was necessary.
– Why did the party that you now support oppose the legislation at that time?
– That is a different argument, and probably the explanation stems from the kind of people who introduced the measure in the first place. That is very sound argument.
It was the Australian Labour party, pledged, as it came to be, to the socialization of the means of production, distribution, and exchange, that drove the Commonwealth Bank away from its competitive banking operations into a fierce and vicious attack on the trading banks with a view to their destruction. It was the Australian Labour party, pledged to socialism, that used this accredited banking institution - the Commonwealth Bank - for the purpose of destroying its competitors. In the destruction of its competitors it was bound to confiscate the property of the people.
That is an operation that is quite understandable to those of us with only an elementary knowledge of history- No socialist country has ever made any progress towards the ultimate objective of socialism without confiscating the property of the people. That is invariably the first step, and that was the first step in the practical application of socialism to Australia.
There is some danger that we have forgotten our own contemporary history. Do honorable members remember the attempt that was made to coerce people into using the banking facilities provided by the Commonwealth Bank to the prejudice of all the other trading banks? Do honorable members remember the edict that was issued to local government authorities - probably the most valiant section of all our political institutions - that they must bank with the Commonwealth Bank or they would be smashed? That was the edict that emanated from the socialists at that time. I must confess that there were people engaged in local government at that time who surrendered, but there were the courageous who resisted, and who fought against the edict with all the weapons available to them. They prevailed, and they saved this country in the first place from the disaster of socialism as it would have been visited upon the entire community.
My attention has been drawn to the time, and I very much regret that I cannot complete the argument in the way that I had intended. However, I add that, from the moment when the local government authorities resisted the first attempt at socialization, the resistance passed to the people. The people, following the magnificent example set by the local government authorities, resisted the attempt to nationalize the banking system, and, by giving this Government an overwhelming majority in 1949, re-affirmed their unswerving faith in our banking establishments as we knew them. From that moment, this Government gave a solemn pledge that it would do all that lay within its power to retain the best of the trading bank systems of the past, to create a central bank that would confine its activities to central banking business, and to inaugurate a Development Bank to provide, for those willing and eager to develop our country, the credit facilities they needed and deserved.
I support all these bills because I believe that a free and competitive banking system is inseparable from democratic society.
Mr. BIRD (Batman) 15.171.- The Minister for Social Services (Mr. Roberton) has attempted, without success, to obscure completely the real reason for this legislation. During his speech, he made a number of statements that will not bear close scrutiny and others that are not supported by fact or by history. The Minister said that the Australian Labour party has changed its traditional character because it is opposing this legislation. It is because of the Australian Labour party’s traditional character that we oppose this legislation. If it had not been for the Australian Labour party, there would not have been a Commonwealth Bank. Because we are the parents of this child that has grown to a very successful adulthood, we are naturally very interested in its career, and will all shortly resist any policy calculated to interfere with its career.
In a further attempt to mislead the House as to the beliefs of the Labour party, the Minister said that he believed in a free and competitive banking system. If that is the view of the Government, then all I can say is that it is time that it carried out its beliefs. This Government instructed the Commonwealth Bank to retire from the hire-purchase field and thus deprived the Commonwealth Bank of an opportunity to engage in free competition with the private banks. If the honorable member for Mallee (Mr. Turnbull), who is looking at me intently and listening to me with avid interest, as he always does, wants to be consistent, he should support the idea that the Labour party has held for many years, and that is that the Commonwealth Bank should be placed on all fours with the private banks and allowed to engage in hirepurchase activities. If Government supporters adopted that idea, they would have many moments of lamentation for the pri vate banks, because such activities by the Commonwealth Bank would cut across a lucrative source of income for the private banks. I agree with the Minister for Social Services that the approach to banking should be one of faith and conscience. Because we have implicit faith in the Commonwealth Bank and conscientiously believe that this legislation is inimical to its interests, we oppose the legislation.
The Minister scoffed at the Labour party and said that, as the conditions under which banking is conducted are changing, we should from time to time support legislation introduced for the purpose of bringing our Australian banking system up to date. That statement is perfectly logical, if the legislation provides a forward step. However, this legislation provides a backward step. This new system of central banking under the legislation now before us is not a forward move, but a move definitely calculated to ensure that the Australian banking system will be altered for the benefit of the private banking system.
The Labour party makes no. apology for opposing these measures. As far as is humanly possible, we are determined to maintain the present influence and prestige of the Commonwealth Bank. Everybody - I include the Treasurer (Sir Arthur Fadden), who is now at the table - knows the reason for this legislation. By ceaseless lobbying, the private banks were able to induce sufficient Government supporters to force the projected legislation through their parties. I do not think that I am doing the Treasurer an injustice when I say that he opposed the legislation, just as many other honorable members opposite opposed it, but the force of numbers prevailed against them. Australian Country party members opposed any change in the banking system and, as a carrot dangling before the noses of the donkeys, the members of the Australian Country party - I am using that expression metaphorically - they were told that they could have a Development Bank. Ever since that was mentioned, members of the Australian Country party have supported the legislation, in the main.
This is apparently a death-bed repentance by members of the Australian Country party, because the need for a Development Bank to give financial assistance to primary producers has not arisen only recently; it has existed for a very long time. However, all of a sudden, we find these protagonists of the present legislation .saying that a Development Bank is most .essential. Opposition members have pointed out previously that the existing legislation contains powers to assist primary producers in much the same way as the projected Development Bank will. The existing legislation needs only minor amendments to permit this to be done. Above all, if this Government were so inclined, it could easily meet the situation by making money available to primary producers at low rates of interest. That is what the primary producers need. I suggest to members of the Australian Country party, who have been so vehement in supporting this legislation because it establishes the Development Bank, that they can get what they want even if the legislation is defeated, as it inevitably will be in another place. Therefore, members of the Australian Country party should not be discouraged when the legislation meets its Nemesis next Thursday week, but should work along the lines that I have suggested to get this much needed assistance for the primary producers. If they do that, it will be the first time for many years that the Australian Country party has done anything for the benefit of the people it represents.
Since the legislation was introduced towards the end of last year, and during this debate, constant attempts have been made to obscure its real purpose. I do not for one moment accept the reasons given by Government supporters as the reasons for the legislation being framed. The authentic purpose of the bills is a calculated and deliberate move to bolster up the private banking system at the expense of the enormously successful people’s bank. Yet, some quaint and odd ideas have emanated from honorable members opposite. We have been told, both during the debate last year and during this debate, that the legislation will strengthen the Commonwealth Bank. What utter nonsense! The parties responsible for this legislation - the private banks - want to weaken the Commonwealth Bank. After all, the private banks are competitors of the Commonwealth Bank and no competitor, whether it be in a grocery or any other business, wants to do anything to strengthen his rival. We live in a competitive world. Naturally, the private banks want to weaken the Commonwealth Bank and to strengthen their own position. That is only common sense. Yet we are told by Government supporters that this legislation will strengthen the Commonwealth Bank. Such a suggestion is sheer hyprocrisy and humbug. No sane person would accept it for one moment.
Labour would be recreant to its trust if it did not point out the real meaning of this iniquitous proposal. The Government has been fairly shrewd in its approach to these measures. It realizes the esteem in which the Commonwealth Bank is held by the people. I must say that I was greatly amused when the Minister for Social Services said that everybody thought the formation of the Commonwealth Bank was a splendid idea. According to him they all said it would be a good idea to have the facilities of a bank such as we were advocating in 1911 and 1912. That may have been a popular subject when the Minister went to school. If the Minister cared to study the history of banking legislation and the discussion of it in Parliament, or if he spent a few minutes perusing the “Hansard” report of the debate in 1911 on the proposal to establish the Commonwealth Bank, he would find that the antiLabour forces in that Parliament were most vigorous in their opposition to the bill. They said that all sorts of evils would afflict the community if that legislation were passed. The people of Australia were told, per medium of the press and in speeches made all over Australia, that the people’s savings would be confiscated.
Some years ago, I recollect, a prominent citizen of Victoria showed me a copy of the Melbourne “ Punch “ of 1911. At that time that paper very enthusiastically supported the anti-Labour forces. The issue which I was shown contained a cartoon depicting a very fat gentleman walking towards a tree carrying two bags labelled “ People’s Savings “. Behind the tree were Andrew Fisher and King O’Malley caricatured as two highwaymen. They had masks on their faces and sticks in their hands and the caption beneath the cartoon read -
Andy: My word, King, we will have a good haul when this fellow comes up to the tree.
In other words, they would confiscate the people’s savings in 1911 by the establishment of the Commonwealth Bank. That is an example of the mentality of the people who opposed the Commonwealth Bank legislation in those days. A similar type of mentality has been evident in the speeches by honorable members on the Government side during this debate. They want to hinder the successful operation of any legislation emanating from the people and exercised for the benefit of the people.
The Government actually does not like the people to have their own bank, but as it is not prepared to make a frontal attack it whittles down its powers. It knows that if it made a frontal attack on the bank the political repercussions would be distinctly unpalatable. However, this Government is fairly skilled in the art of political manoeuvring. It would not dare to knock over the Commonwealth Bank, although every member on the Government side would like to sell it out. The Government realizes that such an action would be politically unwise, and it is not prepared to take it, even at the behest of the private banks, because its members and supporters value their political skins too highly. The Government is following another plan; it is making a side attack on the bank. It intends to alter, surreptitiously, the fabric of the bank so that it will not be so competent as it was or able to exercise the functions vested in it as a result of the 1945 Labour legislation. In words which are often used to describe an activity of this kind, it can be said that the Government is employing Trojan horse tactics to lessen the importance of the bank and weaken its structure by so interfering with its functions that in years to come it will be made so unbusinesslike that the Government will have an excuse to get rid of it altogether. But the Government will not succeed, because the people of Australia will wake up to its nefarious design. Already they recognize the importance of the enormously successful Commonwealth Bank to the economic and political life of this country.
By this series of bills, now before the House for very brief deliberation, the Government hopes, finally, to achieve its objective which is the stultification of the bank’s progress and activity. The Labour party makes no apology at all for its interest in the Commonwealth Bank. In 1907, this party was the first to place a proposal for a Commonwealth Bank in its policy. In 1911 that proposal was brought to the stage of legislative enactment, after very many bitter scenes in the House and very many slanderous and libellous statements in newspapers. In 1907, the Labour party, which always supports social and economic reform, recognized, in those faroff days that the control of credit literally meant power over life and death and would decide whether the queues of unemployed would be long or short.
In 1911, the establishment of the Commonwealth Bank was a revolutionary political proposal. The legislation was placed on the statute-book and the bank had a chequered career until 1945. Little progress was made until 1945 when the passage of the Commonwealth Bank Act in that year really established the Commonwealth Bank as an instrument to be used in the interests of the people and as an integral part of the country’s economy. That was because the Chifley Government stood up to the private banks and was determined to see that the Commonwealth Bank should function fully as a bank operating a national monetary policy and as a central bank in every sense of the word. In 1953, the present Government amended the Commonwealth Bank Act of 1945, but it did not go so far as its banking supporters would have liked. As a consequence, there was agitation to amend the act in order to make the private banks predominant, even at the cost of the disintegration of the Commonwealth Bank.
I want to know why the Commonwealth Government is separating the powers of the central bank and the trading bank. Is it because information has been obtained by the central bank and passed on to the trading bank, which has used it against its private bank competitors? Of course, it ls not. There has never been one case of information being obtained by the central bank and passed on to the trading bank to be used in competition with the private banks. Yet, we have been told that that is one of the reasons why the central bank is to be separated from the trading bank. I say again that the Commonwealth Bank has never utilized its powers to the detriment of the private banks.
We are told, also, that we have to effect this change because it will provide a safeguard against any future Labour party move to nationalize the banks. Everybody knows, including the honorable member for Mallee (Mr. Turnbull), who asked me a few minutes ago about bank nationalization, that under the Constitution the banks cannot be nationalized. The only way in which power can be obtained to nationalize the banks is to get support for such a proposal from a majority of the people of Australia. I am afraid, however, that such a sturdy democrat as the honorable member for Mallee would oppose such a decision by the people of Australia. However, we are dealing with present conditions. Any suggestion that the Commonwealth Government is trying to safeguard the interests of the private banks so that a future Labour government may not nationalize the banks, is so much eyewash. If a Labour government were returned to office, it could immediately amend this legislation and restore the provisions of the 1945 act. There is no need at all to make provision against something that a future Labour government might do. It could as easily repeal this legislation as this Government has introduced it. Such a suggestion is just a phoney idea with no substance at all.
The purpose of this bill is not to safeguard private banks against nationalization by a future Labour government but to disintegrate the functions of the Commonwealth Bank with a view to its ultimate elimination. That is an illustration of the mentality of this Government. There is not the slightest doubt that that is its longrange policy. Politically, it would be unwise to put forward such a proposal as a short-range policy. The proposal now is to separate the Commonwealth Trading Bank from the Reserve Bank both physically and administratively. No intelligent or logical reason has been submitted why this proposed change should take place. Government supporters have engaged in flights of fancy about the dire results that could follow if the present set-up were to be continued.
On the other hand, I must take some notice of the views of the Governor of the Commonwealth Bank. He is there on the job. He knows all the difficulties that the central bank has had to surmount and will meet in the future. He knows the banking system probably far better, and is likely to be much more impartial in the matter than the protagonists of the private banks whom we have heard in this House. He has stated that in his opinion the link between the central bank and the trading banks can be of particular value in times when the economy is threatened with mounting unemployment; in other words, at the present time. No one can say that the economy at the moment is buoyant and that we can be assured of full employment. I hope I am wrong, but it seems to me that the conditions operating in the economy at the moment could result in increasing unemployment. 1 do not think I could be described as an alarmist when I say that the conditions operating to-day are the same as those that operated in Australia in 1929. I hope, however, that the same results will not follow as followed in those days. 1 was one of those who suffered during that period, and I do not want to see anybody suffer similarly in the future.
We cannot take any chances. We have to ensure that the credit policy of the nation rests in the hands of the people’s representative, the Governor of the Commonwealth Bank, that the proper credit policy can be implemented by the central bank, and that the private banks shall not be allowed to prevent the implementation of that policy if it will mean more work for the unemployed. I am not prepared to take the chance. I am prepared to follow the advice of the Governor of the bank because he certainly knows what he is talking about. He has his finger on the economic pulse He has occupied the position for a very long time, and he knows the Australian banking system from A to Z. When he says thait is most necessary to retain this link between the central bank and the trading banks at a time when the economy is threatened with increasing unemployment, I suggest that his opinion will be supported by the great majority of intelligent Australians. To me, and to hundreds of thousands of Australians, the reason that he gives why the link should be retained is much more compelling than the reason given by Government supporters why it should be removed.
I have vivid recollections of how the bank dodged its responsibilities during the depression. The Labour party learned from the bank’s errors of commission and omission at that time. The 1945 legislation, I suggest, made all the provisions necessary for the banking system of the Commonwealth. We want all the machinery retained intact as a safeguard against another depression. The maintenance of the employment level is vital. Therefore, any measure calculated to remove the safeguards against unemployment must be resisted at all costs.
The second notable change that will be brought about by this legislation concerns the special accounts. Here again I see neither rhyme nor reason in bringing this legislation forward. Before 1953 the central bank was empowered to call into special accounts up to 100 per cent, of any increase in the private banks’ surplus investible funds. From 1947. in order to facilitate the post-war demand for credit to finance expansion, the central bank followed a policy of calling to special account such proportions of the private banks’ increase in trading assets as would maintain a ratio of special account cash plus treasury-bills to deposits, in the case of any particular bank, of 50 per cent.
In 1953, the present Government placed greater restrictions on the ability of the central bank to control the nation’s credit policy. The central bank was limited, at that time, in calling to special account any increase in the trading banks’ deposits, to 75 per cent, instead of 100 per cent., and there was the added proviso that any uncalled balance at the end of a year exceeding 10 per cent, was to be cancelled. This procedure had a restrictive effect upon the ability of the central bank to control the national credit policy. The proposal now before us is to reduce the proportion of 75 per cent, to 25 per cent, of a bank’s Australian deposits which may be called to special account at one day’s notice. Notice of 45 days will be required before deposits exceeding 25 per cent, may be called up.
I am completely at a loss to understand the need for any change, and no Government supporter has been able to explain the necessity for it, because the present legislation inflicts no hardship on the banks. At present the call-up is limited to the small amount of £186,000,000, plus 75 per cent, of the increase in deposits since 1953, which has, so far, been relatively small.
At present the banks have about £325,000,000 in their special accounts, which represents only 24 per cent, of their total Australian deposits of £1,342,000,000. Why the change? The amount called to special accounts has never yet reached the proportion of total deposits provided in existing legislation. The change has been made at the behest of the private banking system. I make that assertion irrespective of what Government supporters may say. This Government is carrying out in their entirety the requirements of the private banks.
There never has been any discrimination on the part of the central bank between the Commonwealth Bank and the private trading banks. Because there have not been any abuses, and the Commonwealth Bank has not received any favoured treatment from the central bank, I suggest that this legislation is entirely unnecessary. As a matter of fact, the legislation is merely part of a pattern. The 1945 act gave the central bank effective power to control the volume of money in the community. I should say that it represented the most important milestone in Australia’s legislative history. It was a monumental piece of legislation. It meant that the fear of a depression could be removed, to a very great extent, by a courageous Commonwealth government prepared to use the powers vested in the central bank by that legislation. The measures before the House represent part of a plan to whittle down, indiscernibly but remorselessly, the power of the central bank because it is inimical to the profit motives of the private banks. The Labour party says that the central bank should act solely in the public interest and. without regard to profit as a primary consideration.
This legislation provides for a realinement of the various departments of the Commonwealth Bank. I do not intend to go through the proposals in detail, because they have already received much consideration in this House. It appears that when the separation is effected of the Commonwealth Bank and the central bank, the Commonwealth Trading Bank will receive additional capital to the” extent of £2,000,000. But what will it cost to make the physical change and transfer the banking staff? I venture to say that the bank will not get much change out of the £2,000,000. That money will be dissipated in effecting this useless and entirely unnecessary division of the two banks.
I should like to make just one more comment before I resume my seat. I am completely opposed to the proposed appointment of another Commonwealth Bank Board. We know that the present bank board will become the board of the Reserve Bank, and another board will be appointed for the banking corporation. Eight members will be appointed to the board, including the chairman and deputy chairman in addition to the managing director, deputy managing director, and the Secretary of the Treasury, who will be ex-officio members. I take the greatest exception to the appointment of these eight gentlemen, because it goes without saying that they will be friends of the present Government. I cannot imagine any one being appointed who has political ideas akin to mine. Such a person would noi be wanted; he would be beyond the pale.
I want to point out to the House the grave results that will follow if this legislation is passed. First, it leaves the way open for representatives of private business and private finance to have a say in deciding whether the Commonwealth Bank shall expand its operations in the public interest. Secondly, it gives them an opportunity to take part in decisions as to’ whether new Commonwealth Bank branches shall be opened. Thirdly, it enables them to exercise a measure of control on interest rates - a matter in which the interests of the private banks may well be at complete variance with the public interest. Fourthly, it enables banking policy measures of the highest importance to every Australian family to be decided by amateurs who may stroll into the bank once a month for board meetings. Lastly, it means that knowledge of proposals in which secrecy is of the utmost importance, for example, currency devaluation, should that ever become necessary, must be entrusted in advance to men with private business interests to serve.
Those are five monumental objections to the appointment of any Commonwealth bank board. If this board is appointed - and I have full confidence that the democrats in another place will see that it is not appointed - it will be a very sorry day for the Australian people. The further this legislation is debated, the more it becomes apparent that it has been conceived in a spirit of calculated and deliberate intent to bolster up the private banking system at the expense of the enormously successful Commonwealth Bank. The abject acquiesence of the Government to the peremptory demands of the bankers is a sorry action for Australia. The day will come when, this Parliament will restore the Commonwealth Bank to the position of importance and eminence which it enjoyed after the passage of the Chifley legislation in 1945. I vouchsafe the prophecy to the Government that that will happen quicker than it anticipates.
Mr. STOKES (Maribyrnong) 15.471.- Whilst I regret the necessity to speak again on this legislation, I do relish the opportunity, not only to re-affirm the need for a change in the banking structure of this nation, but also to show up the Opposition’s actions in relation to this legislation in their true light. Before I do that, however, I should like to speak a little about the bewilderment of the honorable member for Batman (Mr. Bird). We have been treated to a very vehement speech by tha* honorable member. He used numerous figures of speech and expressed complete bewilderment with regard to the special account system. He said he could not understand why the Government wanted to change that system. He also said that, under that system, the Commonwealth Trading Bank had received no benefit or advantage. The position is this: Whereas the Commonwealth Trading Bank was required to lodge in special account only a proportion of its funds held at a certain date in the base year, the private trading banks could be compelled to lodge, in addition, something like 70 per cent, of the increase of their deposits since the specified date, which was subsequently fixed as 30th September, 1952. So, in order to make provision for that call-up, the private trading banks have had to retain additional reserves over and above their normal liquidity reserves.
These additional reserves have not been deposited in the special deposit accounts of the Commonwealth Bank and, consequently, no interest has been received on them by the trading banks. The Commonwealth Trading Bank has not been placed in that position. It has only had to deposit a fixed amount in the special deposits account and has had no fears of a call up of a percentage of its increase in deposits. The fact that the private banks were placed in the position that I have described was one of the reasons why many of them were forced into the hire-purchase field.
– - They were after double interest rates.
– They advised their depositors to put their money into hirepurchase companies which were not subject to a 70 per cent, call-up of increases in deposits. That was only common sense. I remind honorable members that in 1946, when the Industrial Finance Department was established in the Commonwealth Bank, its charter provided for nothing else than hire-purchase activities. So, the hirepurchase activities of the Commonwealth Bank were commenced long before any private trading bank engaged in hirepurchase finance.
Another point on which the honorable member for Batman spoke at some length was t”“.2 central bank. He alleged that the central banking functions had been whittled away simply because the Government had divorced it from trading functions. To my knowledge there is, apart from Australia, only one country in the civilized world that has a central bank with trading functions. It is rather strange that that country is Colonel Nasser’s Egypt, which is sometimes eulogized by honorable members opposite.
– That is one thing that he did, at least.
– It suits your book. The honorable member for Batman also said that the loss of the trading functions of the central bank put it out of touch with banking procedures. I have never heard such utter tommyrot in all my life. I say that, because the private trading banks are compelled to submit to the central bank the full programme of their activities. So, lack of trading facilities not only does not weaken the central bank but strengthens it because, in a time of economic crisis, if the central bank had to call up additional reserves from the private trading banks, those banks, knowing that the central bank was a true reserve bank, would appreciate that it would not do anything that it should not do. They would respect it. They would immediately hasten to carry out its edict and further it would not be embroiled in any economic emergency through having on its doorstep a trading bank which would also be imperilled by the economic emergency.
The honorable member for Batman also made allegations concerning the passing of information from the central bank to the Commonwealth Trading Bank. The honorable member said categorically that there was no record of any information about the private banks having been passed, at any time, to the Commonwealth Trading Bank. Of course, there would not be a record of such an occurrence. The honorable member had no more authority for making that statement than I have for refuting it, but it stands to reason that officers of the Commonwealth Trading Bank who were transferred from the staff of the central bank would have their views concerning the private trading banks coloured by their previous association with central bank information. The honorable member for Batman said, also, that these were retrograde measures. If measures that prevent the Opposition from nationalizing banking by administrative act are retrograde, then these are retrograde measures.
We have heard Opposition members today, as we heard them last week, castigating the Government for dealing with these bills as urgent measures in order to get them through this House. Yet, without any debate at all, the same Opposition cast these bills out of the Senate on a previous occasion, and accused the Government of sporting with the lives of sick senators. There can be no doubt that the boot was on the other foot. It was the Opposition that sported with the lives of sick senators. The Opposition has accused the Government, also, of trying to take unfair advantage by putting through measures that this Government firmly believes are of the utmost importance to the economic stability of the country. The Opposition, on the other hand, merely wanted to thwart measures that will prevent it from implementing, by administrative act, that plank of its platform which calls for the nationalization of banking.
In addition to establishing a central bank free from political control, the Government proposes, by these measures, to establish a development bank, which will have greater flexibility than the present Commonwealth Trading Bank. I should like to recall to the House the words of the Treasurer (Sir Arthur Fadden), who, in his second-reading speech on the Commonwealth Banks Bill 1957, as reported at page 1776 of “Hansard” of 24th October, 1957, said referring to the proposed Commonwealth Development Bank -
To give somewhat greater flexibility as to the kind of arrangements which the bank may make with clients, it has been decided to remove the limits which now apply on the maximum amount and the period of loans which the Mortgage Bank Department may make, and we have also included a special provision which ought to be of considerable value, especially to people starting out on the land or establishing new industrial enterprises.
The proposed Development Bank will lend money without the usual considerations as to the adequacy of the security offered by the borrower.
I suggest, Mr. Acting Deputy Speaker, that this would be a suitable time to suspend the sitting for dinner.
Mr. ACTING DEPUTY SPEAKER.Order! We are subject to the time-table, and the honorable member must continue until 6 p.m.
– I will fill in for the honorable member in the meantime, if he likes.
– I will be filling in for the Deputy Leader of the Opposition later. I may say, at this stage, that I had the somewhat doubtful pleasure of seeing him photo.genically presented in a telecast in Melbourne last Sunday evening.
– And a good thing, too.
– That is a matter of opinion. I thought that the Deputy Leader of the Opposition became a little agitated at some of the questions put to him by the questioning panel.
– That is not possible.
– It is possible, although it may be a matter of opinion as to whether he was so agitated as he seemed. A newspaper report of his remarks during the telecast stated -
Mr. Calwell said bank nationalisation was still Labor policy but he didn’t believe it would be an election issue until the Constitution was altered.
– That is a liberal interpretation.
– That is so. But even while it was waiting for the Constitution to be amended, Labour could, if it were in office, by the exercise of discriminatory powers under the existing legislation, call up funds from any bank without imposing such a call on the funds of the other banks, and so disrupt the business of the bank discriminated against by arbitrary act as to put it completely out of business. That is the fear of the private trading banks.
– Does the honorable member believe that Labour would ever do that?
– I do not believe that Labour would not do it.
Sitting suspended from 6 to 8 p.m.
– Before the suspension of the sitting 1 was proceeding to make certain remarks which 1 shall now paraphrase by saying that the present legislation provides for a strong central bank completely divorced from any outside control except that of the Government; a strong trading bank able and willing to engage in active and fair competition with the private trading banks; a strong savings bank with its deposits guaranteed by the Government; finally, a development bank which will enable the young, the earnest and the efficient in our community to make their way in developing this country through either primary or secondary industry, irrespective of the amount of security they may be able to offer for advances.
A matter which may have escaped the notice of the Opposition is that there is a provision extending the present provision regarding the use of funds for housing. In the existing legislation the similar provision applies only to the Commonwealth Trading Bank, but it is now proposed to make it apply also to the Commonwealth Savings Bank. This means that more money will be available for housing. We read in the press that the trading banks have made £500,000 available for housing. As a result of this legislation the Commonwealth Savings Bank will be able to make many times that amount available for housing.
– Why has it not done so before?
– I will turn now to the hypocrisy which certain members of the
Opposition have shown, in their attitude to this legislation. Earlier this evening I referred to a telecast in which my telephotogenic friend the Deputy Leader of the Opposition took part. During the interview in that telecast he was asked about the legislation, and. said -
The Country party only wants it because it provides a development bank - and a puny miserable thing it is, too.
– Who said this?
– The Deputy Leader of the Opposition. Let. us examine for a. moment how puny and miserable the Development Bank is to be. First, it is to be vested with the same powers and functions, with very few limitations, as the Commonwealth Trading Bank and the private trading banks have.. In addition to these full functions it will have further functions which will enable it to provide finance where it would not be otherwise available from banking sources on reasonable terms and conditions, particularly in respect to small undertakings in both primary and secondary industry, and without restriction as to the adequacy of security offered. Further, it is to have the power to provide hire-purchase facilities, and to acquire goods for use in the course of business.
There is one aspect of the Development Bank which does not appear to be fully appreciated by the Opposition. I refer to the control which it may be able to exercise on hire purchase if the extension of its powers into this field is further developed into the general field. By lending money on hire purchase in the general banking field at a competitive rate of interest it could force hire purchase organizations to reduce the rates of interest that they charge.
Surely the Development Bank is to have wide enough powers. Perhaps it was not the powers and functions to which the Deputy Leader of the Opposition attached the words “ puny and miserable “. Perhaps it was the puny stature of the bank in regard to capital. So let us look at the bank’s capital. It is to take over the existing capital of the Mortgage Bank Department and Industrial Finance Department of the Commonwealth Bank, which totals £10,800,000. It is also to take over the reserves of those two departments totalling £3,500,000. It is to have a grant from the central bank of an addi tional £5,000,000. It is to have the power to borrow from the Reserve Bank without the consent of the Treasurer, an additional £2,000,000. So, initially, the capital of this “puny” appendage of the Commonwealth Banking Corporation is to be of the order of £21,000,000. I did not know that my honorable friend opposite had got into such a wealthy class that he could regard an initial capital of £21,000,000 as “puny and miserable “. In addition to that additional capital the bank is to have the right to transfer, by the direction of its own board, such other sums from its reserves as it may desire or require. It may also borrow, with the Treasurer’s consent, unlimited amounts within the Commonwealth. Further, it is to be able to use, as other banks do, its depositors’ funds. I agree that depositors may not readily come forward when a bank is taking more than a normal banking risk; but it must be remembered that the deposits of this bank are to be guaranteed by the Government, so it could easily get deposits.
In addition to the things I have mentioned the Development Bank will not have to pay any of its profits to anybody. They can go into reserves and be used in the bank’s business. The bank will not pay taxes. It is not to be subject to the usual provision regarding statutory deposits. So it will have large funds available to it, and I cannot concede that the Deputy Leader of the Opposition was being anything but hypocritical when he- made his statement. As a matter of fact, it is interesting to recall that. when, this- measure was debated on the previous occasion some honorable members on this side of the House, including me, were greatly concerned lest the powers covering the capital of this proposed bank were such that the bank could achieve mammoth proportions and become a banking colossus on its own. So there you have two points of view - “ puny “ on one side, “ too big “ on the other. It is true that since I and some of my colleagues had these fears certain amendments have been made, but these do not restrict the amount or funds available to the Development Bank, only the supervision of their allotment.
Another point emerges from the Opposition’s attitude to these measures. I have referred to the honorable member for Melbourne and his disparaging remarks regarding the Development Bank; but I have also heard disparaging remarks from the Opposition to the effect that the legislation regarding the Development Bank is not necessary because there are already sufficient provisions in existing legislation, requiring only the addition of a few extra clauses to enable the carrying out, by the existing institutions, of the functions intended for the Development Bank. I would like to point out that in this House, immediately after the Senate had so cavalierly rejected these measures on a previous occasion, the honorable member for Melbourne Ports, who interjected a short time ago asked a certain question of the Treasurer, who is now sitting at the table. This was his question -
My question to the Treasurer is to some extent supplementary to that asked by the honorable member for Chisholm. In view of the fact that the Government’s fourteen banking bills have been rejected in the Senate, will the Treasurer, as Leader of the Australian Country party-
That is very subtle! - as well as Treasurer, introduce separately a bill to establish a development bank with power to finance domestic and commercial hire-purchase transactions, as well as the development of primary and secondary industries?
On the one hand, honorable members opposite claim that there is sufficient power in the existing legislation, but on the other hand, they ask for a separate measure to be introduced and indicate that it will have the Opposition’s wholehearted support. Whom are they trying to fool? They have it one way, and then they have it the other way.
– Provision is already in the act.
– Then why on earth did the right honorable gentleman have one of his leading supporters ask that question?
– To get some money for housing.
– The money is available for housing under this legislation.
– Why not study the bills?
– I have studied the bills, but the honorable member has not. To sum up, the Opposition is continually crying, as it did a moment ago, for more money for housing, more money for development in order to maintain full employment, and a reduction of hire-purchase interest rates. Yet, when the Government introduces legislation which will assist to meet these demands, the Opposition rejects it out of hand! Opposition members are hidebound in relation to their policy of nationalization of banking. It seems quite apparent to me that the Opposition, with its outside support, has used these measures as a political football. Honorable members opposite had the idea that they could force a double dissolution, and, as this hope fades, they are still forced to pay lip service to their original concept. They are still sticking to their catchcries. They say that when they are returned to power they will repeal this legislation if it has become law. If that is so, why did they jeopardize the life of Senator Arnold, unless they believed that not until the far, far distant future would they ever have a chance of repealing the legislation? Still with their tongues in their cheeks they cry, “Hands off the people’s bank “. Do they not realize how many people have investments with the private banks? This Government’s policy is “ Hands off the people’s liberties “.
.- The manner of the Government’s presentation of this legislation involves a definite abrogation of the rights of parliamentary government, because the majority of honorable members have been denied the opportunity to take their rightful part in this assembly’s deliberations. The Standing Orders lay down the rights of honorable members to represent their constituents and to express their views on any legislation that comes before the House. In spite of this, the Government has been prepared to set aside and bypass these rights. Here are fourteen items of legislation that deal with matters affecting the foundations of community life in Australia. They are probably more important than any legislation that has been put before any Australian parliament since 1945. Yet we are required to give consideration to these bills in a matter of minutes and to deny them the consideration that is rightly their due!
When fundamental changes such as are now intended are proposed, there is a definite obligation on the part of the Government to provide facilities for adequate inquiry into the merit of the proposals. Who are the people that are seeking such changes? We have a right to ask that question. They are certainly not the people generally, because there has been no general demand for a change in the banking system. One can therefore say that the request for an alteration does not come from the general community.
Alterations to the legislation were not even in the mind of the Government parties at the last elections. At least they did not feature in the policy which the Government presented to the electorate. Evidently the Government was not then concerned with any idea of essential changes in our banking system. I understand that the business people have made no representations for the effecting of changes.
– That is not true.
– Well, we have not had the advantage of any information from the Government to the effect that that section of the community has made any such representations. All that we know is that the private trading banks have definitely made demands upon the Government for changes to be made in the structure of our banking system. This legislation does not propose any alteration to the structural organization of private banks. It does not touch them at all in that respect. The one bank that is to suffer by reason of the Government’s actions is the people’s bank, which is so important to the financial structure of the nation. I remember the old adage that finance is government. It is quite evident that those who can dictate financial policy are really the true masters of the country. That being so, we have a right to examine the calls and claims that are made for alterations such as those that are now proposed. I feel sure that these alterations will not receive the endorsement of the people when they are given an opportunity to express their views. It is remarkable that every time supporters of this type of government contemplate changes in our banking system they seek to make inroads upon the authority and general organization of the people’s bank, the Commonwealth Bank of Australia. It has been so from the beginning. They have sought to arrest its progress whenever they could.
The honorable member for Maribyrnong (Mr. Stokes), who has just resumed his seat, said that the Commonwealth Bank does not pay taxes to the Government as do the private banks. I remind the honorable member, however, that the Commonwealth Bank has made a contribution to the Trea sury much larger than the amount it would have paid in taxes, because half of the bank’s profits have gone towards the liquidation of the national debt. It cannot be claimed that the private banks have made a similar contribution. Therefore, the honorable member did not present a true picture of the situation.
I direct the attention of the House to the inquiry that was made by the Royal Commission on Monetary and Banking Systems some years ago. After the depression of the 1930’s, the consensus of opinion was that some investigation should be made into the monetary and banking systems of Australia; and a Liberal Prime Minister, Mr. J. A. Lyons, appointed a royal commission for that purpose. Its terms of reference were - . . to inquire into the monetary and banking systems at present in operation in Australia and to report whether any, and if so what, alterations are desirable in the interests of the people of Australia as a whole, and the manner in which any such alterations should be effected.
The members of the commission were the Honorable John Mellis Napier, a judge of the Supreme Court of South Australia, Mr. Edwin Nixon, C.M.G., Professor Richard Charles Mills, the Honorable Joseph Benedict Chifley, Mr. H. A. Pitt, C.M.G., O.B.E., Director of Finance, Victorian State Treasury, and Mr. J. P Abbott, who was a Liberal-Country party member of this Parliament.
– He was a Country party member.
– It does not make any difference because the policies of the parties I have mentioned are the same. The members of the royal commission investigated the monetary and banking systems very fully and they stated in the introduction to their report -
When we were satisfied that we were in possession of adequate information with respect to the existing system, we proceeded to take evidence from economists, representatives of industry and commerce, and the public generally . . .
All who intimated their desire to appear before the Commission were given an opportunity to present their views.
The commission commenced its investigation in November, 1935, and submitted its report in July, 1937. The investigation was not hurried; the commission took two years and eight months to examine the monetary and banking systems of Australia. Every one who had anything whatever to say regarding the conduct of monetary and banking affairs was given an opportunity to be heard. Although, so far as 1 know, the members of the royal commission included only one Labour man, the commission found -
The Bank’s view has been that its trading bank activities are “ a favourable adjunct to central bank control in the power they confer to influence interest rates, to expand advances, if necessary, and to provide facilities which the trading banks may refuse or may not be in a position to supply “. In our opinion this is a proper practice for a central bank to adopt.
Honorable members on the Government side cannot reject that proposition which was made by the royal commission. Some of them will say, “ But that was twenty years ago “. It is true that the report is twenty years old. That being so, it is evident that if there were reasons why changes should be made in the banking system, in the light of this document which took two years and eight months to complete, there should have been some further investigation by a supplementary body which would have had the means to examine the position fully and make a report to this Parliament. Then, everybody would have been satisfied that the Parliament had been given the best advice based on evidence obtained from all sections of the community.
One must ask why the Government wants the changes proposed under these bills. The honorable member for Melbourne Ports (Mr. Crean) put his finger on one aspect of the situation when he referred to the special accounts. He pointed out that the total amount of those accounts, after the recent release of £15,000,000, is now £325,000,000 in round figures; and he added -
Of that amount £280,000,000 has been drawn off as part of the credit control machinery from the streams of activities in the hands of the private banks. Formerly, until 1st January this year, the private banks received only 5s. per cent, interest in respect of that £280,000,000; but from 1st January they are to be paid 15s. per cent, interest. That means that they are to receive i per cent, additional income in respect of £280,000,000 deposited at the moment with the Central Bank. The effect of that is an immediate increase in the earning power of the private banking system over a period of twelve months of £1,400,000,000 in round figures. Coupled with that is the recent announcement that some of the special accounts are to be unfrozen, and so far an amount of £15,000,000 has been so treated. A greater sum may be unfrozen later on. Thus, instead of earning interest on that £15,000,000 at the new rate of i per cent, payable on money held in special accounts, the banks will be able to invest this at an average rate of 5i per cent. - sometimes at 5 per cent., sometimes at 5i per cent and sometimes at 6 per cent. These two changes - the increase of the interest rate and the release of £15,000,000 from special accounts - will mean a net increase in the earning capacity of the private trading banks of £2,000,000 annually.
That is rather an interesting situation. The private banks, by reason of the changes proposed in the banking structure, are to be presented with an opportunity for changes with regard to the reserve amounts that they may be holding. It will mean that the private banks will have an additional £2,000,000 annually for investment purposes. No wonder the banks can afford to make generous contributions to the campaign expenses of honorable members opposite, and to provide assistance, through their staffs, in organizing election campaigns! Not content with that, the private banks want to check the onward progress of the Commonwealth Bank, which to-day has proved itself to be a very formidable competitor. The Government has made concessions to the private banks so that they are now permitted to engage in savings bank activities. Until recently savings bank business was conducted only by Government-owned institutions, such as the Commonwealth Savings Bank, and State savings banks.
The private banks have now, with the blessing of the Government, entered the hire-purchase field. Their funds are now earning higher rates of interest than was previously possible. The man on the land will verify what I say. Private banks have made it very difficult for people in agricultural areas to obtain overdrafts. These people are encouraged to secure their financial assistance from hire-purchase companies, in which the private banks have large interests.
It must be apparent to everybody that although the private banking institutions are clamouring for changes in the banking structure, the proposed changes relate only to the Commonwealth Bank. The measure before the House seeks to divide the Commonwealth Bank into three separate organizations - one dealing with reserve bank activities and development; another dealing with trading bank operations; and another dealing with savings bank functions. Each section is to have its own separated management, but over all there will be a board. which will be able to dictate the policy to be followed by each of the bank’s branches. There is no suggestion that the private banks should be re-organized in this way. They do not come within the perview of the legislation in the same way. This legislation is, in my view, an attempt by the private banks to arrest the competitive powers of the Commonwealth Bank and to diminish the efficiency that it has displayed in providing for the essential needs of the country. The private banks want to reduce the efficiency of this great agency that helped to finance the war effort and which played such a noble part in the post-war reconstruction programme. The people of this country will withstand these onslaughts that are made on their bank by the private banking institutions, and will do all in their power to preserve the security that the Commonwealth Bank now gives them.
– The debate to which we have been listening for the last two days has been merely a rehash of the debate that we heard last November. The measures now before the House were fully debated on that occasion. Therefore, I do not propose to go into the detail of the legislation, but shall make some general observations on it. I have listened to the debate carefully.
The feature that strikes one when listening to the debate is that many extraneous matters, which are not affected by the bills in any shape or form, have been introduced. The criticism of interest rates and other matters of that nature that has been made by member after member on the Opposition side has nothing whatever to do with the bills. If some of these matters need correction, they can be corrected equally as well under these bills as they could have been corrected under the old legislation. The point that I make is that the legislation has no effect on 99 per cent, of the matters that have been raised by Opposition members.
Opposition members have not raised any issue that was not mentioned when the bills were before the House on the last occasion. Practically the whole of their time has been devoted to a tirade of abuse agains the private banks. Opposition members charge this Government with trying to destroy the Commonwealth Bank. That is their principal agrument. Then, while they are on their feet, they take advantage of the occasion to make a vicious attack upon the private trading banks. That is their age-old form; they have always attacked and tried to destroy the private trading banks. But at no time during the debate have I heard any fact that would justify their attack.
What is banking? Banking is merely a service to the people and to the nation. The banks safeguard the people’s savings and deposits, on the one hand, and, on the other hand, make credit facilities available to clients for their advancement and progress.
– Who wrote that?
– I wrote it. That is why it is so important. The fundamental ingredient in any banking system, although no Opposition member seems to pay much attention to it, is the confidence of the people in the banking institutions. Banking must be based on confidence in the institutions - confidence in their safety and confidence in their honesty and fair dealing. Similarly, all progress and all investment is based upon the confidence of the person who is taking advantage of the facilities provided by these institutions. Why does Labour attack the private trading banks? Undoubtedly, we should all be very proud of our private trading banks. I do not say that with any particular favour; I say that as a fact, and it can be proved. Are we forgetting that this young country is only 170 years old and that the private trading bank system has been operating here for 142 years?
– What does that prove?
– That proves a great dea when we remember that for almost 100 years Australia had only a private trading bank system. The Commonwealth Bank was not established until 45 years ago. So, those people concerned with the progress of this country for almost a century depended for their banking facilities on the much despised private trading banks. That factor cannot be denied. The whole of the early development of Australia depended on the private trading banks that are now receiving so much abuse. Are the private trading banks an evil in our community?
Opposition members. - Yes.
– You see what I mean. That is exactly what I expected you to say.
– Then you are not disappointed.
– That is right, I am not disappointed. The people of Australia should take note of the Opposition’s attitude, after what I have just said. Most of the great industries of this country, to which we so proudly point when referring to the progress of Australia, owe their establishment and their progress to the assistance that was given to them by the private banking structure. The private trading banks have given a chance in life to tens of thousands of people.
– And they have ruined hundreds of thousands!
– Why is it that millions of people still trust them and still have confidence in them? That rather belies the honorable member’s charge. The private trading banks have been trusted by the people; there is no doubt about that. They do not rest only upon security, as the Labour party would have us believe. In every respect, the private banks conduct their business in a most humane way. I know of. many industries that have been established with advances made by private trading banks, purely on their assessment of the honesty of the individual, without any security whatever. I could mention an endless number of cases in which that has happened in my own career. Those people have established our great industries. The private banks do not look at a transaction only from the point of view of security; they look also at the human factor, and they have given magnificent service to many people. I say these things because the Labour party has tried to create an atmosphere in which the people of Australia will conclude that the private trading banks are an evil in the community. On the contrary, the private trading bank system is one of the greatest things that has happened to Australia; it has assisted Australia to grow.
The private banks are not owned by the great capitalists, as the Labour party tells the people. They are not owned by the wealthy interests in Australia. The average shareholding of the private trading banks would not exceed £2,000. The private banks are owned and controlled, and their capital is furnished, by the average Australian citizen. Why then do we find this hatred by Labour of the private trading bank system? The truth is - we must face the truth in this matter - that the private trading banks are an essential part of free enterprise, for which the Government stands. They must and they do come directly in the path of Labour’s socialist objectives. That is the fundamental reason why Labour attacks the private trading banks and why it wants to get its hands completely upon the Commonwealth Bank structure as a monopoly. That is not stating something new; that is simply repeating something that is known to every person in Australia. In 1947, Labour made its direct attack on the nationalization of the banks of Australia. In 1949, when the election took place, this Government was returned on the issue of bank nationalization. That was the people’s answer to Labour’s attack upon the private trading banks and its desire to nationalize them in pursuance of its socialist policy. It tried to crush the private trading banks, but Australia was saved, only by the Constitution of this country. Had it not been for that obstacle, we would probably not have been saved from living under socialist conditions as the Labour party would have us do. Indeed, had Labour won the election in 1 949, in spite of its policy of bank nationalization being defeated on constitutional grounds, it would have still achieved its purpose by strangulating the private banks.
It was obvious from the attitude of the Labour party that it was eager to achieve its socialist objective of crushing the trading banks and nationalizing the banking structure in Australia. What is evident from this debate is that Labour still means to do that. That has been admitted by the honorable member for East Sydney (Mr. Ward), who sits opposite me at the moment. No doubt if he is the next speaker we shall hear another tirade of abuse. I will probably be charged with taking key money, and with all sorts of things. But that will not matter; it will not prevent me from saying my little piece. This legislation will make it a good deal more difficult for Labour to nationalize the banks if it should be returned to power. The people will be able to have more obvious warning of Labour’s desire to nationalize the banks, and they will no doubt rise in their wrath to prevent that from happening.
This Government believes in a free banking system. It stands firmly for that, and the people of Australia know it. There is no ambiguity about Ms policy. There is room in a free banking system - indeed there is great need - for both Government and private banking. There is no need for this conflict to take place, as honorable members opposite suggest. There is no conflict in the minds of members on this side of the House in relation to the need for the Commonwealth Bank. We have nothing against the Commonwealth Bank. We want it to grow and prosper. We have no desire to destroy it. But, at the same time, we say that it is an excellent thing to have a private banking system which encourages healthy competition in the community. It will produce greater service and efficiency in the banking field; and will prevent the establishment of a banking monopoly. There are two kinds of monopoly - government as well as private - and government monopoly is just as serious as private monopoly.
The bills now under discussion will place all banks on the same basis. This legislation will also enable the development of modern banking techniques because of the freedom it will provide for the banking structure. In a speech in Melbourne the other day, the Deputy Leader of the Opposition (Mr. Calwell) told the people of Australia that if Labour was returned to power it would wipe out this legislation as well as the 1953 act, and would go back to the 1945 measure. This Government is not in favour of going back; it wants to go forward, and that is what this legislation will enable the banking system to do.
How does this legislation weaken the Commonwealth Bank structure? I have not heard one member of the Opposition make any statement to convince me that it does. When the Government introduced the 1953 legislation - I was reading some of the speeches made in that debate only today - honorable members opposite said that the measure was brought down for the purpose of trying to destroy the Commonwealth Bank. Has that legislation destroyed, or injured, the Commonwealth Bank? On the contrary, that bank has continued to grow, and it has expanded enormously since that time. Similar growth will follow the passage of these bills. They will be of the greatest possible benefit to the Commonwealth of Australia and to the
Commonwealth Bank. I say, with a full knowledge of this legislation, that under it the Commonwealth Bank will develop into a still greater institution.
So much for the suggestion by the Opposition that this legislation will destroy the Commonwealth Bank. This Government is pledged and determined to develop and maintain the Commonwealth Bank for the benefit of the people of Australia. That is its objective, as expressed in these bills. The Treasurer (Sir Arthur Fadden), who is sitting behind me and who deserves to be complimented on this legislation, will agree that it is his purpose, and the purpose of the Government, to make the Commonwealth Bank still greater. There is no intention of destroying it.
I wish to consider the new set-up proposed under this legislation. First of all, there is the Reserve Bank or what is called the centra] bank. Every one with any knowledge of finance at all must know that it is essential for a country of any size to have a central banking system. It is the regulator of our credit structure, and it must be free and unfettered; it is the means by which our economy is kept in a stable condition. The Reserve Bank will be charged with the task of seeing that our development progresses and that employment is steady. That is part of its charge. It is an essential for the economy that the Reserve Bank be completely free to carry out its charter without in any way being distracted by trading activities. For the life of me, I cannot understand how it can be claimed that a reserve bank, set up in this way, will be detrimental to the Commonwealth Bank in its trading activities. Such an arrangement will enable the bank to run more efficiently; and it will create greater harmony in banking throughout Australia. What harm can be caused by a reserve bank set up in this way? This system is followed all over the world. What is wrong with it? I have not yet heard any honorable member say what is wrong with having a reserve bank, or central bank, which is not in any way distracted by trading activities. This system is accepted in every country; it is a world-wide principle. The Reserve Bank will have all the necessary control over the trading banks, both Government and private, to enable the country’s economy to remain stable; it is essential to the growth of the nation.
The proposed Commonwealth Banking Corporation will incorporate the three banks - the Commonwealth Trading Bank, the Commonwealth Savings Bank and the Development Bank. What is there to complain about in this measure in relation to the trading bank? The conditions under which the Commonwealth Trading Bank operates under this legislation are identical with those under which every private trading bank operates. Is there anything wrong with that? Is it placed at a disadvantage? Are we trying to destroy it? On the contrary, as I have already said, and as the Government has said over and over again, this will give every possible encouragement to the development of the Commonwealth Trading Bank. It is a well-established bank, and is very popular with the people, and I have no doubt that it will grow, after the passage of this legislation, as it has grown in the past.
Another bank with which we are concerned is the Commonwealth Savings Bank. This is a magnificent institution, and nothing in the legislation before us is calculated to destroy it or reduce its popularity with the people. It has enormous credit reserves made of the savings of the people of Australia. It is a grand bank, and it is growing by leaps and bounds, notwithstanding the 1953 legislation of this Government. Both it and the Commonwealth Trading Bank will have a very special charter, the credit for which must be given to my colleague, the Treasurer (Sir Arthur Fadden). They will be instructed to make loans for housing purposes and to lend money to building societies.
I feel that the people of Australia should be made aware of the Labour party’s opposition to this legislation, even to that portion of it which provides that the banks shall lend money for housing purposes. I remind honorable members that the Commonwealth Bank is, in fact, the largest individual contributor in Australia to housing loans, and the legislation we are considering provides that specific instructions shall be given to the banks with relation to lending money for housing. This is surely a most important feature for the people of Australia; yet the Labour party will oppose it. The Opposition will use its numbers to prevent people all over Australia from obtaining the housing loans that they so sadly need.
The other institution that the legislation proposes to establish is the Development Bank. This is a new institution, which, I believe, every Australian will welcome. I venture to suggest that if we could tour the constituencies of Opposition members and explain the purposes of and the need for the Development Bank, it would be difficult to find any person who would oppose it. Yet the Labour party proposes to prevent the establishment of this bank.
As we all know, the Development Bank will incorporate the present Mortgage Bank and the Industrial Finance Department of the Commonwealth Bank. The Government proposes to provide a considerable amount of additional capital for this new bank, the purpose of which is to assist primary industry and to help in the development of secondary industries. It has been stated that additional capital will be provided for this bank. I ask honorable members, in all common sense: Does a government provide additional capital for something that it wants to destroy? In the name of Heaven, Mr. Speaker, where are we getting to in this debate? I challenge the sincerity of the Labour party in opposing this legislation. Its opposition can be based, as I said before, only on its desire to crush the private trading banks and completely nationalize the banking structure, so that it may implement its socialist policy. Let the Leader of the Opposition (Dr. Evatt) deny that that is so.
– We do!
– Evidently the Leader of the Opposition is not in agreement with the honorable member for East Sydney (Mr. Ward), who has proclaimed time and again, and even as late as last night, that the policy of the Labour party is still socialism. AH I want to say is that Labour is doing a great disservice to Australia. I do not put this matter on a political platform; I simply say that Labour is doing a great disservice to Australia, simply because the members of the Labour party entertain this mad idea of destroying the private trading banks and nationalizing the banking structure of the country. That is still their purpose; they have admitted it over and over again.
– Can people get key money on hire purchase?
– You see? They have now some stupid idea about key money. The Opposition intends to use its numbers in another place to prevent this legislation becoming law, even after it is passed by this House, although I suggest that the Government has a charter from the people of Australia for this legislation. For the Opposition to use its numbers in another place to prevent the legislation coming into effect is a dastardly thing.
– Oh, no!
– Yes! I believe that the Opposition is doing the people of Australia a tremendous disservice, and that the people will realize it eventually and will treat the members of the Labour party as they deserve to be treated. I believe that these proposals constitute a great advantage in our banking systems and would be of enormous benefit to the development of the country. The legislation would make the Commonwealth Bank greater and would give our whole banking structure and our credit systems a tremendous fillip. Let me suggest that the Labour party should yet reconsider the matter, and should not allow these proposals to be destroyed simply because of their hatred of the private trading banks.
I congratulate the Treasurer on introducing this legislation. I believe he has done a magnificent job, an even greater job than any of us believed in the beginning could be done. 1 sincerely hope that common sense will yet prevail, and that this legislation will be allowed to benefit the people of Australia and assist in the growth of our great young country.
.- I did not believe it possible for the Minister for the Army (Mr. Cramer) to know less about anything than he does about the Army, but he has excelled himself this evening in his speech on banking and financial matters. He directed a number of questions to the Opposition, and to me as the next Opposition speaker. Probably time will not permit me to answer all of them, but I hope to answer some of them. The Minister asked: Why does Labour attack the private banks? I shall endeavour to tell him as I proceed, but I think I should commence by telling him why the Government defends the private banks.
Not one honorable member on the Government side who has spoken has told us what this legislation will do to benefit the Australian community. Government supporters have, on the other hand, said how unfair the present situation is to the private banks. Well, they are earning their fee. I would not suggest that the Minister for the Army is worthy of a very high fee, but he is entitled to participate in the general payment, and the private banks do make heavy payments to this Government.
– That is not true.
– The Minister says it is not true. Let us produce the evidence. 1 remind the House that the honorable member for Barker (Mr. Forbes) said that Opposition supporters had accused the Government of being in the pay of the private banks, and he asked: Where is the evidence? I suggest that the Minister for the Army might look at a speech made by the late Benjamin Chifley when he was defeated at the 1949 elections. When he came back into this Parliament he made a speech, which is on record, in which he accused the Liberal government of that day of having received hundreds of thousands of pounds from the private banks. He not only accused it, but he also said that he had evidence to support his accusations, and that he knew that the money had been paid. I say to these gentlemen, or these jackals, who are now seeking to interject - or to those of them who were in this House in 1949 - that the real test of the matter is this: Why did they not have an inquiry conducted into the allegations of the late Mr. Chifley? Why did they not refer the matter to their famous privileges committee, if they are so concerned about allegations made against honorable members in this chamber?
The fact is that they were unable to have an investigation because even during the referendum campaign some of the private banks brazenly and openly paid amounts to members of the Government for their electioneering and campaign expenses as an examination of the books of those banks would show. These things can be proved. When the Minister for the Army asks why Labour attacks the private banks, he talks as though the private banks have been great public benefactors. Referring to the 140 years of the history of banking in this country, the Minister said that the private banks dealt with matters in a humane way. I shall ask the members of the Australian Country party whether they remember the case of the late Mr. Wilkins. Mr. Wilkins was an Australian Country party member in the State Parliament of New South “Wales. He was a one-legged ex-serviceman. The private bank that had a mortgage over his property foreclosed and even laid a claim against his war pension.
That is how the private banks deal in a human way with the problems that come before them from day to day. They are no different to any other capitalistic, monopolistic concern. They are out to get their last ounce of profit and they do not care who is crushed or injured in the process. Why did not Government supporters talk about the bank crash of the 1890’s, when the private banks were forced to close their doors, and not only the depositors, but many of their shareholders, suffered financial loss. The history of private banking in this country is a great trail of ruin of many people. The nationalization of banking is the policy of the Labour party. AVe think that the great Commonwealth Bank is quite adequate and efficiently managed to conduct the banking business of this country. We think it could do that in a more efficient and competent manner than the collection of private banks in this country.
As the Leader of the Opposition (Dr. Evatt) said, bank nationalization cannot be an issue in this debate because the High Court and the Privy Council have declared that the constitutional powers now existing in this Parliament are insufficient to permit of the nationalizing of the banks. But the people of this country can correct that -situation when given the opportunity in future. Judging from the way members of the Government talk, one would imagine that the Labour Government’s nationalization proposal had been overwhelmingly defeated. As a matter of fact, the results of the referendum were remarkable. After a very short campaign for which Labour had not prepared carefully, almost 50 per cent, of the Australian electorate voted in favour of the nationalization of the banks. “That is what the Government is afraid of.
The Treasurer (Sir Arthur Fadden) admitted in his speech that the powers of the central ‘bank had not been abused. “But Government supporters have expressed their fear that there may be a change of government and that the new government may not be so favorably disposed towards the private banks as this Government is. I was going to say I doubted whether Government supporters believed in democracy; I have no doubts about that at all. I know that they are Nazi-minded. They believe in dictatorship; they believe in authoritarian government. So they brazenly say to the Australian people that they are aiming to tie the situation up so that even if the majority of the electors return a Labour government which may be pledged to a different policy, that government will be unable to do anything about it. Is not that the aim of this legislation? It is completely undemocratic.
The Minister for the Army said that the Government wanted healthy competition. What did the Labour government find when it came to office? We found that the various branch managers of the Commonwealth Bank had been instructed that they were not to accept any new business if it meant taking business away from a private bank. Was that healthy competition or was it an attempt by the previous government to hamstring the Commonwealth Bank? The Minister for the Army said that all banks would be placed on the same basis under this legislation. That is not true. Either the Minister has not read the legislation or he does not understand it. This legislation gives to the private financial interests of this country a control over the Commonwealth Bank but it does not give to the Commonwealth Bank or the people’s representatives a like control over the private banks. The aim of the Government is to cripple the Commonwealth Bank.
The members of the Government seem to take some credit for the fact that this lusty infant that was created by the Labour Government of 1911 has continued to prosper despite all their efforts at strangulation. The purpose of the Government’s legislation of 1953, like the purpose of its legislation of 1951 and other years, was to damage the Commonwealth Bank. But the management of the Commonwealth Bank has been so able that the bank has prospered. Now, the Government is making another effort to destroy it. The Minister for the Army said that the Opposition had wrongly charged the Government with aiming to destroy the Commonwealth Bank.
The establishment of the Commonwealth Bank was opposed by the anti-Labour parties and right down through the years they have endeavoured to destroy it. It has been a great bank.
Why did an anti-Labour Government create the Commonwealth Bank Board? Members of the Australian Country party still contend that the bank board was a good idea - that it helped to strengthen the Commonwealth Bank. I should like to tell them what happened when the bank had no board and what happened under the board, but time will not permit me to recapitulate all the events. One thing that disturbs Government supporters is the fact that the Commonwealth Bank started with no capital. We are continually told that people who invest their capital are entitled to as high a return as they can obtain on it. But the Commonwealth Bank started without any capital. In 1920, when there was no board in charge of the Commonwealth Bank, the private banks were following a deflationary policy. Because there was no board, the Commonwealth Bank was able to make an immediate issue of credit to the extent of £23,000,000. That action saved the situation in 1920.
During World War I., the Commonwealth Bank floated loans at 5s. 7d. per cent., as against £3 per cent, charged by the private banks. In 1924, when the Bruce-Page Government appointed the bank board for the first time, bank charges in respect of advances for primary production rose from £3,000,000 to £7,000,000 in one year’s operations - an increase of £4,000,000 in bank charges to rural producers. In the financial year 1924-25, the Western Australian wheatgrowers decided to establish a voluntary pool. They went to the private banks for finance and the private banks turned them down. They eventually obtained their finance from the Co-operative Wholesale Society of England, and the money was paid to the London branch of the Commonwealth Bank. Then the Commonwealth Bank Board arranged with the private banks to transmit the money to Australia, and the bank charges for a mere telegraphic advice were £60,000, which had to be met by the wheat-growers of Australia.
In 1936, the bank board increased interest rates, following similar action by the private banks. On 25th March, 1936, referring to that action, the Melbourne “ Age “ said-
The fact that impresses and startles the community is that in matters of such vital importance the Federal Government can be a mere cipher and the great institution which is owned by the people - the Commonwealth Bank - instead of making policy is forced to follow a policy dictated by others.
What is the situation at the moment? Honorable members should not let the Government try to pull their legs by stating that there is a great popular demand outside the Parliament for this type of legislation. There is an abundance of evidence to show that it has been the private banks who have been pressing the Government to redeem its promises to them - not promises given at an election, but promises given in the secret and private conferences which the Government periodically has with these gentlemen.
The address of Mr. Staniforth Ricketson, chairman of directors of Haliburton Investments (Australia) Limited, to the sixth annual meeting of the company, on 22nd January of last year, is reported, under the headline, “ Last Opportunity for the Banks “, as containing the following reference to the previous legislation: -
By the time the new legislation became operative the elections would be not more than a year off.
If however, the decision on banking is now delayed, the Government could not logically be expected to take effective action at any later stage and risk giving the Labour Party, on the eve of the next elections, an issue they could capitalize vigorously throughout the campaign.
Does that indicate that this legislation has been demanded by the Australian public? Of course it does not. Let me remind the House what the Treasurer said in his secondreading speech on the Reserve Bank Bill 1957, on 24th October, last. As reported in “Hansard”, at page 1770, he said -
Eventually the private banks submitted revised proposals-
Evidently, the banks had already made proposals to the Government - which, while not wholly satisfactory from ourstandpoint, did offer a basis on which we could create a new system in place of special accounts, a system which would provide safeguards of the kind the banks desire . . .
Have honorable members ever heard such a brazen and outrageous statement made by a Commonwealth Treasurer? He admits that these proposals, as submitted by the private banks, are not regarded by the Government as wholly satisfactory to it. But they are still to become law, and the banks have received everything for which they have asked. I challenge the Treasurer to tell us in what way the proposals at present before the House are deemed by the Government to be not satisfactory. The Government has remained completely silent on this point. What has happened is obvious.
Let me quote, without mentioning the name of the person concerned, the views expressed a few years ago, when there was agitation for an inquiry into banking operations in this country, by a member of the Australian Country party who still sits in this House. He said -
It is necessary that an inquiry should be conducted by the very best brains available, by people who . . . are free from any undue reluctance to interfere with institutions which have demonstrated their ability to influence government policy, and to direct the whole course of our economic life . . . The inert power of resistance of nervous or selfish vested interests, and the mediums of propaganda which they control, have prevented a mandate from being received by those who have sufficient enterprise to act . . . The policy of the Bank Board, . . . either with or without the concurrence of the Government, has been to refrain from full and normal competition with the trading banks.
– Who said that?
– That was said, when in opposition, by a gentleman who, to-day, happens to be a member of the Government. It was said by the present Minister for Trade (Mr. McEwen), who criticized the private banks and the operations of the Commonwealth Bank Board. I should like to tell the House, also, what has been said by the right honorable member for Cowper (Sir Earle Page), who proudly stands in his place in this House and talks of the part that he played in the establishment of the board. He made a statement about the operations of the private banks during the 1914-18 war. Doubtless, he hoped that no one would take the trouble to look up what he said in those days. He stated -
Mindful of their own interests they have no such regard for the public welfare as is undoubtedly required.
Despite those opinions about the private banks, the Minister for the Army tells us that the private banks are great human institutions which approach these problems in a human way.
Let me remind Government supporters how this Government has been dominated by the private banks. On one occasion, following the Royal Commission on Monetary and Banking Systems of 1937, which has been mentioned frequently in this debate, the government of the day introduced banking legislation in this Parliament. I think that the present Minister for External Affairs (Mr. Casey) was then Treasurer. The legislation was said to be based on the findings of the royal commission, but nothing could be further from the truth. How was that legislation formulated? The “ Sydney Morning Herald “, in its issue of 31st March, 1938, stated-
The Federal Treasurer said last night that the meeting of Bankers over which he presided in Sydney had been very useful. There had been a very frank exchange of views, but obviously he could not divulge the nature of the discussions.
The Conference was arranged to discuss: The Report and Recommendations of the Royal Commission on Banking, with the object of assisting the Federal Ministry in framing amending Banking legislation.
On 7th April, 1938, the same newspaper reported -
The Federal Cabinet has agreed to compromise on certain of the recommendations of the Royal Commission en Banking to meet the objections of the Private Banks to the form of the new Banking Bill.
Is there now any doubt about the subservience of this Government, which is of the same kind as the previous administration that I have just mentioned? Many of the men who supported that previous government still sit in this Parliament. Is there any doubt that they had secret conferences with the private banks? They discussed with the representatives of the banks the legislation that was to be introduced in this Parliament, and the Treasurer of the day refused even to tell the Parliament what had been discussed or what decisions had been arrived at. We can imagine what a howl there would be if the waterside workers, for example, were called into secret conference by a Labour government to discuss some condition of employment h an award under which they were to work. It is evident, Mr. Speaker, that this is a government that represents the private banks and the great monopolies of country.
Let me deal now with the Australian Country party, members of which seem to think that this legislation will not injure country interests. Members of the Australian Country party will find that their supporters in rural districts will take an entirely different view. We know that this Government has done absolutely nothing to control or regulate hire-purchase activities. On 4th June last, the “ Sydney Morning Herald “, in an article under the headline, “ The Countryman and Hire Purchase “, stated -
A Dubbo farmer was relating how he had gone to his bank for an increase in his overdraft.
He planned improvement to his property and potential output which required expenditure mostly on new equipment.
After listening the bank manager made these points -
It was a good plan.
Unfortunately the credit squeeze had left him without funds to give the farmer an overdraft, but
if the farmer moved down the counter where the bank’s hire-purchase associated business was conducted it would probably have the funds.
This Dubbo farmer was advised that he could get the money to buy new plant and machinery in order to increase production, not at the overdraft interest rate of 5½ per cent. or 6 per cent., but at the hire-purchase interest rate of 15 per cent., from the hirepurchase section of the bank conducted in the same building as that in which its banking activities were conducted. Is that the kind of banking system that we are to have?
In the few minutes that remain to me, let me indicate the opinions of the farmers, who are supposed to be represented by members of the Australian Country party. On 15th May, 1953, the “Sydney Morning Herald “ reported that a survey had been conducted by the Division of Marketing and Agricultural Economics of the New South Wales Department of Agriculture, in cooperation with the Division of Agricultural Economics of the Commonwealth department then known as the Department of Commerce and Agriculture. Sixty-three per cent, of the wheat-growers considered the time favorable for investment in farm improvements. Only 30 per cent, were willing to borrow for that purpose, although 60 per cent, were free of debt. Only 12 per cent, of them owed more than £5,000. The newspaper commented -
It may well be that the farmer’s reluctance to borrow is to some extent a legacy of the depression . . .
During the early 30’s so many farmers got into the hands of the banks . . .
Many of the older farmers particularly are determined to keep out of the banks’ hands in the future, and they are therefore reluctant to borrow for any purpose at all.
That is the general opinion among country men. The bank that is held in the highest regard in country districts, and has helped most in rural development, is the Commonwealth Bank of Australia. The honorable member for Wentworth (Mr. Bury) talked about the right of the-
– Order! The time allotted for the secondreading stage of these bills has expired.
Question put -
That the bills be now read a second time.
The House divided. (Mr. Speaker - Hon. John McLeay.)
Majority . . 17
Question so resolved in the affirmative.
Bills read a second time, and committed pro forma; progress reported.
Message recommending appropriation reported.
In committee (Consideration of GovernorGeneral’s message):
Motion (by Sir Arthur Fadden) agreed to -
That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to regulate banking, to make provision for the protection of the currency and of the public credit of the Commonwealth, and for other purposes.
Resolution reported and adopted.
In committee: Consideration resumed.
19.40]. - I desire to make one or two general observations with regard to the bills, as they are being taken as a whole. During the course of the debate on the banking legislation, Opposition speakers have inferred that in the proposed legislation-
– I take a point of order. The Treasurer is not entitled, I submit, under the Standing Orders, to traverse the arguments that were used in the course of the second-reading debate. He has already said that he wants to reply to what was said in that debate.
The CHAIRMAN (Mr. Adermann).The Treasurer has scope to deal with those matters because the committee is dealing with the bills as a whole.
– I desire to bring some facts before the committee, having regard to observations that have been made on the bills that are presently before the House. Section 8 of the present Commonwealth Bank Act provides-
– I take a point of order. The Treasurer said that he was referring to some observations that had been made. He must obviously be referring to observations made during the second-reading debate, and therefore he is not in order.
– I have already ruled on that matter. I shall take notice of what the Treasurer says and rule accordingly.
– I desire to deal with clause 10 of the Reserve Bank Bill and draw the attention of the committee to provisions of the bill that evidently have not been studied. Paragraph (2.) of the clause reads -
It is the duty of the Board, within the limits of its powers, to ensure that the monetary and banking policy of the Bank is directed to the greatest advantage of the people of Australia and that the powers of the Bank under this Act, the Banking Act 1957 and the regulations under that Act are exercised in such a manner as, in the opinion of the Board, will best contribute to -
the stability of the currency of Australia;
the maintenance of full employment in Australia;
I emphasize the words “ the maintenance of full employment in Australia “. That is specifically provided for in the legislation before the committee. The paragraph continues -
It will therefore be seen that this provision is practically identical with the provision in section 8 of the Commonwealth Bank Act. The only difference is that the words “ the Bank “ have been replaced by the words “ the Board “. The change is of no policy significance and has been made for purely drafting reasons.
I direct attention to the fact that in clause 28 of the Commonwealth Banks Bill, the charter of the Commonwealth Trading Bank to carry on general banking business and to develop and expand its business is retained. By clause 9, however, the duty is laid upon the Commonwealth Banking Corporation Board to ensure that the policy of the Commonwealth Trading Bank is directed to the greatest advantage of the people of Australia and has due regard to the stability and balanced development of the Australian economy. It will be seen that this is an expansion of the Commonwealth Trading Bank’s charter as compared with the present act.
In clause 41 of the Commonwealth Banks Bill, the Commonwealth Savings Bank is given the duty, not only’ to carry on its general business as a savings bank, but also “ to encourage saving and to promote the interests of its depositors “. In clause 9, the Commonwealth Hank Corporation Board is given the same duty in relation to the Savings Bank as in relation to the Trading Bank.
It will therefore be seen that any allegations that this Government has not given full and proper regard in the charters of the banks to the necessity to maintain full employment and to promote the economic prosperity and welfare of Australia are ill founded.
– Are you going to take up all the time allotted?
– The charter of the centra! bank is, in fact, being retained virtually unaltered from its present form, while the charters of the Trading Bank and the Savings Bank are being expanded in very important respects. I again direct the committee’s attention to the retention from the present legislation of the provision relating to full employment. Any allegation that the Government has dropped that very important objective is without any foundation at all.
The trading banks, under the proposed legislation, are far more harshly treated than they are under the current legislation or, indeed, than they were under the 1945 Chifley legislation. The very basis of central bank control is the taking of power to regulate the credit base of the monetary system and the trading activities of the trading banking system of Australia.
Motion (by Mr. Calwell) put -
That the right honorable member be not further heard.
The committee divided. (The Chairman - Mr. C. F. Adermann.)
Majority . . . . 14
Question so resolved in the negative.
Under the legislation that is before the committeee, no limit is placed on the amounts that may be called up from the trading banks to the central bank subject, however, to 45 days’ notice of calls above 25 per cent, of total deposits. Therefore, it is obvious that under this legislation, the fundamental principle of central bank control over the trading banks can be applied far more harshly and more onerously than it is at present, or, indeed, has been applied over many years. I emphasize that under this new legislation the trading banks can be required to deposit, without limitation, a required percentage of their total deposits, and not a percentage of their increased deposits as is provided under the existing legislation. Therefore, it is ridiculous to suggest that the central bank is not being given additional power over the general banking system, which obviously means the trading banks, including the Commonwealth Trading Bank.
The most important point about this legislation from a central bank point of view is the control which the central bank must be given to regulate general credit in the banking system generally. Therefore, I repeat with emphasis that under the proposed legislation, the central bank will have the power to call up 100 per cent, of the banks’ total deposits, subject to 45 days’ notice, compared with power to call up 75 per cent, of increased deposits under present and former acts.
.- When these measures were before the committee previously, the Australian Labour party moved a number of amendments and opposed a considerable number of clauses, but as the bills are to be taken on this occasion as a whole, it is not possible for the Opposition to do that to-night. I direct the attention of the committee in particular to clause 26 of the Reserve Bank Bill which provides for the separation of the central bank functions from the other functions of the Commonwealth Bank. I direct attention also to the absurd provision of clause 74 which makes it obligatory for the Reserve Bank to acquire entirely new premises. So complete is the separation to be that the Reserve Bank cannot be associated with its old colleagues even in one building. That is an absurd provision when it is realized that, anyway, people can meet in board rooms or talk over telephones. During the debate when these measures were previously before the House the Opposition claimed that reconstruction of the Commonwealth Bank would cost anything from £10,000,000 to £15,000,000. That statement was never denied by the Government, and to-night statements have been bandied around the House about the millions of pounds that will be released when this measure becomes law. So far as the community is concerned, those millions of pounds at least will be wasted. People who know something abou! the last legislative changes to the Commonwealth Bank in 1953 estimate that the various legal costs in changing names and registering title deeds and so on involved the bank in expenditure running into millions of pounds. Government supporters have said nothing about what this proposed legislation will cost.
I should like to draw the attention of the committee to section 101 of the present Commonwealth Bank Act. Some honorable members have to-night been claiming that the legislation relating to the Development Bank provides for entirely new provisions, but let them compare the wording of section 101 of the Commonwealth Bank Act with the wording of clause 73 of the Commonwealth Banks bill. Clause 73(1.) states -
In determining whether or not finance shall be provided for a person, the Development Bank shall have regard primarily to the prospects of the operations of that person becoming, or continuing to be, successful and shall not necessarily have regard to the value of the security . . .
Those words are lifted straight from the present Commonwealth Bank Act. Just to have it on record, I read section 101 (2.) of the Commonwealth Bank Act 1945 -
In determining whether or not finance shall be provided under this Part for the establishment or development of an industrial undertaking, the Bank shall have regard primarily to the prospects of the undertaking continuing to be, or becoming, a profitable undertaking and shall not necessarily have regard to the present value of the assets of the undertaking.
If there is still some doubt as to the ability of the Government to give loans for rural finance, 1 shall quote section 81 of the Commonwealth Bank Act 1945 -
Subject to this Part, a loan made under this Part shall be on such terms and conditions as the Bank determines.
In other words, all this hocus pocus about the impossibility of performing the functions of the new Development Bank under existing legislation is false. It is odd to hear the honorable member for Maribyrnong (Mr. Stokes) alleging hypocrisy on the part of the Opposition. He originally was an opponent of the Development Bank because he felt that it would invade the province of the private trading banks. Whatever this new Development Bank will be able to do can be largely done under existing legislation. If a few minor amendments are required, surely it is not necessary to dismember the Commonwealth Bank. It is something like the story of the 50-50 horse and rabbit pie - one horse and one rabbit. You do not need to kill the horse in order to pull the “ development “ rabbit out of the hat.
The same reasoning applies to the claim that the new legislation will release millions of pounds for housing. Why cannot the millions of pounds, if they exist, be released under the existing savings bank provisions? It is not that millions of pounds are not available. What is strangling housing in this country to-day is the high rate of interest at which money has to be borrowed. This Government has not used its effective banking powers for the good of the community as a whole, but has allowed interest rates to sky-rocket to absurd heights. Hirepurchase companies are offering 10 per cent, interest for a three-years’ loan. As my colleague, the honorable member for Yarra (Mr. Cairns) has pointed out, who would invest money for housing at 5 per cent, or 6 per cent.? It is my contention that, if the Government was so minded, money could be made available for housing at interest rates as low as 3 per cent, and 4 per cent. It is a subterfuge on the part of the Government to state that the new Savings Bank provisions will increase the amount of money available for housing. Such benefits can be provided without altering the existing legislation in any respect. All that is necessary is a will on the part of the Government to use its powers under the 1945 act. Let the Government use the powers that it possesses and not dismember a successful institution in the name of political dogma that does not stand up to the light of intellectual examination. It is only a political dogma that says that central banking and other banking cannot be carried on by the same institution or in the same building. One can get as many authorities against the proposition as can be obtained in favour of it. As the honorable member for Bonython (Mr. Makin) said to-night, if changes have to be made they should be made only after full and frank examination, not just at the demand of the private banking institutions.
– I rise to correct the honorable member for Melbourne Ports (Mr. Crean). He said that the legislation passed by the Chifley Government in 1945 provided ample opportunity to deal with the requirements and functions of the proposed Development Bank. He also dogmatically stated that the legislation did not need to be altered by even so much as a comma or a semi-colon. I draw attention to the 1945 Commonwealth Bank Act, which was re-enacted in certain respects by this Government in 1953, dealing with the Mortgage Bank Department. The honorable member for Melbourne Ports said that a structure already existed to carry out the proposed functions of the Development Bank. I draw the honorable member’s attention to the fact that there is a limitation both as to amount and as to duration of loans from the Mortgage Bank Department. Section 82 of the Commonwealth Bank Act states -
A loan under this Part shall not be made for a period of less than five years or more than fortyone years.
Section 83 of that act states -
The amount of any loan under this Part, or, if there are two or more such loans to any one person or to persons jointly, the aggregate amount of those loans, shall not exceed seventy per centum of the value (as determined by the Bank) of the estate or interest in land on which the loan or loans are secured, or Five thousand pounds, whichever is the less.
They are the limitations that are placed on the Mortgage Bank Department at present. Let me draw attention to the flexibility of the proposed legislation. Clause 72 of the Commonwealth Banks Bill states -
The functions of the Development Bank are -
to provide finance for persons -
for the purposes of primary production; or
for the establishment or development of industrial undertakings, particularly small undertakings, in cases where, in the opinion of the Development Bank, the provision of the finance is desirable and the finance would not otherwise be available on reasonable and suitable terms and conditions; and
to provide advice and assistance with a view to promoting the efficient organization and conduct of primary production or of industrial undertakings.
Clause 73(1.) states -
In determining whether or not finance shall be provided for a person, the Development Bank shall have regard primarily to the prospects of the operations of that person-
– I rise to order, Mr. Chairman. Under the “ guillotine “ provisions the committee stage was to cease at ten minutes past ten, and it is now eleven minutes past ten.
– That is not the time at all. I know this is getting under the honorable member’s skin, but he should look at this point before putting his neck out. Clause 73 (1 . ) reads -
In determining whether or not finance shall be provided-
– Mr. Chairman, did you rule on my point of order that the provision of the guillotine is that the vote is to be taken at ten minutes past ten o’clock?
– Order! It was not ten past ten o’clock when the honorable member raised the point of order.
– The clause continues - for a person, the Development Bank shall have regard primarily to the prospects of the operations of that person becoming, or continuing to be, successful-
– Order! The time allotted for the committee stage of the bills has expired.
Question put -
That the bills be agreed to and that the bills be reported without amendment.
The committee divided. (The Chairman - Mr. C. F. Adermann.)
Question so resolved in the affirmative.
Bills agreed to.
Bills reported without amendment; report adopted.
Motion (by Sir Arthur Fadden) proposed -
That the bills be now read a third time.
.- I have only a few words to say. The Opposition will continue its fight against this legislation now and in another place, and, when it is rejected by the Senate, we will be very happy to see the fight transferred to the hustings as soon as the Government can summon up enough courage to take the issue to the people.
Question put -
That the bills be now read a third time.
The House divided. (Mr. Speaker - Hon. John McLeay.)
No member shall be entitled to vote in any division upon a question (not being a matter of public policy)-
Order! The honorable member is in order.
– Standing Order 193 provides -
No member shall be entitled to vote in any division upon a question (not being a matter of public policy) in which he has a direct pecuniary interest not held in common with the rest of the subjects of the Crown. The vote of a member may not be challenged except on a question of privilege raised immediately after the vote is cast, and the vote of a member determined to be so interested shall be disallowed.
There is a current rumour - which may be based on fact - which I have heard in several quarters, that the honorable member for Parramatta (Sir Garfield Barwick), who appeared for the Australian Associated Banks in litigation before the High Court of Australia and before the Privy Council, did not accept a fee in the normal way for his services but was given an annuity by the banks. If that is so, the honorable member is obviously disqualified from voting in this division. It is a very prevalent rumour.
– Mr. Speaker, I draw your attention to Standing Order 202, which provides -
While the House is dividing members may speak, sitting, to a point of order arising out of or during the division.
Should not the honorable member for Eas Sydney be seated when addressing the Chair in division?
– Order! I ask the House to come to order. A matter of privilege has been raised; the honorable member is not speaking to a point of order.
– Despite the point of order and the rude interjections from the Government benches, I am not going to be deterred from doing my public duty. I contend that this matter should be resolved before the result of this division is declared. If the current rumour - which is not one that I, only, have heard, but is current in many quarters - has any substance, I submit that this matter should be determined before this vote is declared. I ask you, Mr. Speaker, to act accordingly.
Mr. SPEAKER__ Order! As the question on which the division is being taken involves a matter of public policy, no question of privilege arises. In any event, the matter raised by the honorable member is based on rumour.
– I wish to raise a matter of privilege.
– Order! Is it the same matter on which the Chair has just ruled?
– No, it is a different matter; it concerns a different person and is not based on rumour. However, ic relates to the same standing order under which I challenge the right of the honorable member for Sturt (Mr. Wilson) to take part in this division. I have personally checked the share list of the Bank of Adelaide and find that his name appears on that list as a shareholder.
– Order! As the honorable member cast a vote on a matter of public policy, the challenge to his vote is out of order.
– I wish to make a personal explanation. I repeat that I do not own a single share in the Bank of Adelaide or in any other bank.
Question resolved in the affirmative.
– I wish to make a personal explanation.
– Does the honorable member claim to have been misrepresented?
– Yes. In division, the honorable member for Sturt said that he has no shares in the Bank of Adelaide. I said just now that I had personally checked the share list and found that the honorable member’s name appears on the share list. I repeat that assertion and ask him to deny it.
Bills read a third time.
Snowy Mountains Authority Housing Scheme - Registration of Fingerprints - Immigration and Unemployment - Interjections in Debate - Tariff Board.
Motion (by Mr. Harold Holt) proposed -
That the House do now adjourn.
– I bring to the attention of the House a directive issued by the Commissioner of the Snowy Mountains Hydroelectric Authority relating to the allocation of houses. This directive involves a system of allocation so vicious and unjust, and involving so much hardship, that I feel that there is no other way to deal with it than to bring it to the attention of this House. I have already brought it to the attention of the commissioner himself, Sir William Hudson, but he is completely unable to agree with me as to the injustice and, indeed, the viciousness of the system that he has instituted.
Houses that have been built for the Snowy Mountains Authority, with public funds, will now be allocated to employees of the authority on a points system, under which points are given for the quality and quantity of an applicant’s output. Points to be given under this heading will be determined by the applicant’s divisional head. Five or six points are to be allotted to an outstanding officer or wages employee. No points are to be allotted to personnel whose output value can be classed as below average. Persons whose output value is only average are to be allotted only one point, and no more than two points if the value of their output is only slightly above average. In other words, if a man wishes to obtain a house from the Snowy Mountains Authority he must work harder and produce more than the average man in the gang to which he belongs.
– He has to be an average worker.
– No, he must be more than an average worker. No matter what his ability, if he wants to obtain a house he has to press himself harder than the other men in his gang in order to obtain the points necessary to gain the reward of a house. This seems vicious in the extreme.
I now direct attention, however, to another feature of the matter which is even more unjust. Employees are allotted threequarters of one point for each £100 per annum of salary or wages above £600, the calculation being to the nearest £100. In other words, it is not the housing need of the man concerned or of his family that is taken into account, but the amount of salary that he earns as an employee of the authority. This means, of course, that the men in the top jobs have first claim for houses. The useful but low-paid employees of the authority can never get houses while highly paid men are waiting for them.
Another objectionable feature of the scheme is that three points are awarded where both husband and wife work for the authority in the same locality. In other words, a man and wife without children have priority over a man whose wife does not work for the authority because she stays home to look after a family.
– What authority is the honorable member speaking of?
– The Snowy Mountains Hydro-electric Authority. The most extraordinary feature of the scheme, however, appears from the final paragraph of the directive, which reads -
Irrespective of the number of points accumulated, cleaners, labourers, camp attendants, clerical labourers, builders’ labourers, fitters’ assistants and car drivers will not be allotted houses whilst competent tradesmen are still on the waiting list.
It appears that the labourer is completely denied any right to a house while other persons are on the waiting list.
I have discussed this matter with the commissioner at length. I have been unable to move him, and he has certainly been unable to move me. His justification for this action is that the authority must endeavour to allot the houses on the basis of usefulness to the scheme, and he considers an engineer of more use to the scheme than a labourer or a car driver. He also considers, evidently, that a professional man is of more use to the scheme than a tradesman.
– That is what they did in Russia!
– I have never heard of it being done in Australia before. I hope it will be a short-lived system in this instance, because I have never heard of anything like it being attempted in any part of Australia. A labourer is as useful to the scheme as an engineer. Neither can exist without the other. The same applies to the car drivers, cleaners and others who are being penalized. Hundreds of people who came to Cooma and other parts of the Snowy Mountains area to work for the authority when another system was in operation, under which they had every reason to believe they would get houses in their turn, now find themselves completely deprived of the opportunity of obtaining houses because of this new system. Any person classed as a labourer, cleaner, car driver, or in any of the other categories I have mentioned, no matter how long he has been waiting, how faithfully he has served the authority, how large his family or how severe the hardships he is suffering because of the lack of a home, will not be able to obtain one while a person receiving a higher salary is on the waiting list.
This directive is causing most intense dissatisfaction among the employees of the Snowy Mountains Authority. I have the greatest respect for Sir William Hudson as an engineer and as the commissioner in charge of the scheme, but in issuing this directive it appears to me that he has erred very gravely.
– What do the unions think about it?
– The view of all those concerned is that the system is most obnoxious.
– Where are these people living now?
– Those who are waiting for houses are, in many cases, living in garages or sheds, or in parts of houses or rooms that they have managed to obtain. A number of them are living in pretty awful conditions.
– Have the unions made a protest?
– Yes, I understand that union protests have been made, and I, as their spokesman, and at their request, have made personal and direct protests to the commissioner, with whom I have discussed this matter at length. I have found myself, however, completely unable to move him.
– But have the unions made a protest?
– I think I have answered the honorable member. The commissioner adheres to the view that his job is to provide houses according to the usefulness to the scheme of the applicants, and his interpretation of usefulness to the scheme is based, as I have shown, first on salary, because an additional three-quarters of a point is given for every £100 of salary above £600. In addition, in order to gain extra points men must work harder and compete against their mates working in the same gang. Finally, there is the provision that ordinary workers, such as labourers, camp attendants, clerical labourers, builders’ labourers, fitters’ assistants and car drivers will not be allotted houses while competent tradesmen are on the waiting list; and competent tradesmen will not be allotted houses while staff officers of higher salary are on the waiting list.
This system is so bad that I hope the Minister for Air (Mr. Osborne), who is now at the table, will take the matter up at once, and that the Government will use its influence with the commissioner of the Snowy Mountains authority - which, after all, is an independent authority established by an act of this Parliament - to ensure that this unjust directive is quickly withdrawn.
– I wish to draw the attention of the House to a report that certain officers of the police forces of Australia have met and recommended that the citizens of Australia should be fingerprinted. This has been discussed on several occasions. While I can understand the reason, on the administrative level, for officers of the police force considering this matter, I think it is a most unwise proposal. I think it is reasonable for me to bring it before this House because the Government of the Commonwealth of Australia is responsible for several police forces - that of the Australian Capital Territory and those of the other territories administered by the Government.
While the people of Australia may have reason to believe that this would be a helpful procedure and to have confidence that it would not be abused by this Government, think it most unwise to consider the proposal in any way at all. Whatever conidence people may have in the present r egime, one must think of the alternative government that may take office at some time in the future. The alternative to the present Prime Minister (Mr. Menzies) is the present Leader of the Opposition (Dr. Evatt). Instead of the present Treasurer (Sir Arthur Fadden), we would have the present Deputy Leader of the Opposition (Mr. Calwell). Instead of the present Minister for Labour and National Service (Mr. Harold Holt), we would have the honorable member for East Sydney (Mr. Ward). I have been in this House for only about eight years, but I remember very well the pronouncements of these honorable members. Consequently, I think it is very unwise that the regimentation of the people of Australia in this way should be in contemplation.
When Labour was in office, honorable members opposite used every opportunity to regiment the people of Australia. During the war years, in relation to petrol rationing, a power was used to limit the freedom of movement of the citizens of Australia. For three years after the war had ended, that power was retained by the government of which some honorable members opposite were the foundation. We came to office at the end of December, 1949, and removed mat restriction.
I think it is no exaggeration, nor is it a result of imagination, to say that this regimentation of people by making them register their fingerprints would be dangerous. There is no doubt that there will be a turn of the wheel in due course, and that honorable members opposite will form the government. They will then do everything in their power to restrict the movement of people. As they have already taken action in a small degree to limit the movement of people, one can easily visualize that, under their future regime, before a person leaves his own area he will have to register the fact that he is moving to another place. I bring this matter to the attention of the House in the hope that the Government will take action in regard to it.
– I desire to raise a matter which has already been exposed to the public by Labour. I refer to the growing number of unemployed in this country but inparticular. to the numbers amongst them - and they must be legion - of immigrants who have been brought to this country under the immigration scheme of the present Government. When they arrive here they go immediately on to the employment market and have to receive unemployment relief. i shall quote a couple of specific cases, although I shall not give the names at this stage. I have already given them to the Department of Immigration. These cases concern two Greek girls, one eighteen and the other twenty years of age. I am advised that they were brought to this country, having been recruited by the Immigration Department for domestic work. Neither of them is able to speak English. The one who is eighteen years of age arrived in Australia on 14th September, 1957. The other one arrived on 26th December, 1957. I understand that from the day that they arrived they have been receiving unemployment benefit at the Newtown unemployment office.
I approached the immigration authorities and they stated that these girls had been recruited, as I have said, for domestic work. It had been accepted that they could not speak English but when they arrived no work could be found for them. The only income that these immigrants, who had been enticed to settle in this country, have had has been the unemployment benefit payment. These people have come to this country in the hope that in this expanding and developing nation they will be able lo find work and security. Instead, they have been brought here at the expense of the Australian people and placed on the employment market, together with many Australians.
When the Labour government instituted the immigration scheme it insisted that every person who was brought to this country should be able to fit into our society and should have a job. It is as unfortunate for these people as it is for this country that they should be unemployed. One can witness a no more humiliating sight than these people. I see them often because they live not far from me. They walk around looking for employment but they are unable to get it. They suffer from a tremendous drawback in the fact that they cannot speak English. Many other such cases could be cited by other member? of the Parliament if they so desired.
I shall provide details of these two cases to the Minister for Immigration. I will ask him to confirm what has already been conveyed to me by his officers. No doubt they have been doing their best.
People who are brought to this country without employment being available for them immediately become a burden to the community and to their families. The Government’s immigration policy reacts to the detriment of the development of this country. The Government should review its immigration policy in many ways. It is a disgrace that any government should encourage people to come here when they are unable to obtain work. This is a situation that ought to be reviewed by the Minister for Immigration (Mr. Townley).
It ought to be easy to absorb the people to whom I have referred in an expanding country with an expanding economy. But all I can get from the immigration authorities is an assurance that they will keep these people registered, and that special efforts to place them in employment are being made. I should like to know from the Minister for Immigration whether many more cases of this kind are brought to his notice. Undoubtedly, with so many Australians unemployed, these people are even worse off. They have additional difficulties caused by the language problem and what one may term their lack of knowledge of local circumstances and other factors. There is certainly need for the Government to look into this case that I have mentioned, and doubtless many others.
My purpose in speaking to-night is, first, to criticize the Government’s policy, which allows men and women to be brought to Australia although they cannot be placed in employment when they get here. It is unfortunate that the scheme instituted by Labour, which showed such promise, and was so effectively administered by the Labour government, should now be broken down in the manner that I have indicated this evening. If this Government cannot employ every immigrant that it brings here, it does a disservice to the individuals concerned, and an equally great disservice to Australia. I ask the Minister to look into the case that I have mentioned. I will give him the names and addresses of the people concerned. When I last heard of them, they were still unemployed, and had very little prospect of finding work. The brother of the two girls has been in Australia for some years, and has taken his place in Australian society. He is employed in a position in which he receives about £13 10s. a week. He is at present paying more than £4 a week for a room for his sisters and himself. At the same time, he is trying to remit some money abroad for his family, and, in addition, he has had to meet medical expenses for his sisters. Although in employment, he is on the bread-line, and heavily in debt because of his commitments for medical and other expenses.
I sincerely urge- the Minister to look into this case. I ask him, first, to see whether these young women can be placed in employment, and to make a thorough investigation of all aspects of the immigration scheme, and particularly the provision of work for immigrants when they arrive in this country. If the Government cannot provide work for every person that it brings to Australia, irrespective of the immigrant’s nationality, it should curtail the immigration scheme. I trust that the Minister will take appropriate action.
.- I am surprised at the vein in which the honorable member for Grayndler (Mr. Daly) has spoken. Doubtless, any one could pick out of the air specific cases of hardship among immigrants. Although, over a period of years, more than 1,200,000 immigrants have come to Australia, as the Minister for Labour and National Service (Mr. Harold Holt) pointed out the other day, fewer than 150 immigrants in migrant camps have not been placed in employment. I think that that refutes the statements made by the honorable member for Grayndler, who was adamant in his refusal to say whether the people whom he mentioned were sponsored immigrants. If they were sponsored, accommodation would have to be provided for them, and they would have to be guaranteed employment by their sponsors on their arrival.
– That is not correct.
– I made the qualification that those were the requirements for sponsored immigrants. The honorable member stated that the persons of whom he spoke cannot speak English. Does he suggest that any of the 10,000 people from
Hungary who were brought to Australia through the humanitarian efforts of this Government should have been abandoned merely because they could not speak English? If this country is to expand and develop, we must have immigrants. I am surprised that the representative of an electorate such as Grayndler, should support the efforts of the Leader of the Opposition (Dr. Evatt) to have the immigration programme reduced. At the same time, the honorable member for Yarra (Mr. Cairns) says that more immigrants should be brought here from southern Europe. Can all such immigrants speak English when they arrive in Australia?
Do Opposition members ever stop to think of the contribution to Australia’s progress and development that has been made by the immigrants who have come here?
– I rise to order. Is the honorable member for Phillip in order in speaking from a seat other than his own?
– On the point of order, I suggest that there is no standing order that debars an honorable member from speaking from any seat that he likes to choose.
– Before you rule on the point of order, Mr. Speaker, I should like to speak to it. I refer you to the rulings of the honorable member for Wimmera (Mr. Lawrence), the very honorable member who has just taken the point that an honorable member may speak from any seat. On at least one occasion that I recall, the honorable member for Wimmera has ruled that a member may not speak from a seat other than his own. I should like to know whether or not such a ruling is correct.
– Having returned to my own seat, Mr. Speaker, I should like .-> resume.
– Order! I have first to rule on the point of order. The position is that if an honorable member put the matter to the test he could speak from anywhere in the chamber. The honorable member for Phillip has resumed his seat; so it will be in order for him to proceed.
– I rise to order.
– Order!. Is the honorable member canvassing my ruling?
– I ask for your ruling as to whether- an honorable member may receive the call from the Chair for a second time on the one question.
– Order ! It is. in order for the honorable member for Phillip to proceed.
– 1 realize that Opposition members do not like any one to direct attention to the division in their ranks over the immigration programme. It is quite obvious that a deep division has arisen, due entirely to political’ reasons. Labour tried to use the Australian Citizenship Convention, held earlier in the year,, solely for political purposes, and the honorable member for Grayndler is now trying to use the opportunity for debate on the motion for the adjournment of the House for the same purposes. He has decried the immigration programme, which has brought so much prosperity to Australia, and his principal reason for criticizing it is that some immigrants cannot speak English. If we are not to bring here people who cannot speak English, how can we expect Australia to progress? We must have immigrants, and it is the Government’s intention to bring out another 115,000 people every year. That number is equivalent to only 1 per cent, of the present population. Immigrants are contributing a great deal to Australia’s development, in spite of Labour’s claims to the contrary, and their efforts are doing much to alleviate the unemployment problem. Immigrants are producing mors than they consume.
We know that the honorable member fo/ Melbourne (Mr. Calwell), on television the other night, said categorically that the immigration programme should not be cut. But where do the honorable member for Grayndler, the honorable member for Yarra, and the Leader of the Opposition stand? There is a diversity of opinion among the four Opposition members whom I have mentioned. I strongly urge members of the Australian Labour party to get together on immigration, and think of it as a cause of national importance and not as a matter of political expediency or something that can be kicked about like a football in this chamber or in public halls at meetings that they may be called1 upon to address. Immigration is a question of national importance, and we must endeavour to foster a worth-while immigration programme. The best advice that we can get indicates that we need more, than 30,000,000 people in this country if we are to expand our economy and protect the Australian nation, to say nothing of producing all the goods that we require. If we are to take all the immigrants we want, we cannot allow ourselves to be put off by the assertion of the honorable member for Grayndler that two persons, out of the 1,200,000 who have come to Australia under the immigration programme, cannot speak English.
If the honorable member is sincere in his claims, let him make them not only in this Parliament, but also in his electorate. Doubtless, he attends naturalization ceremonies in his electorate, and tells immigrants how glad he is to receive them into this country, as do many other Labour members, some of whom have attended many of the naturalization ceremonies at which I have been privileged to be present. And I can say in truth that I consider it a privilege to attend those gatherings. Why do not honorable members opposite come into the open and say to immigrants,, “ We want to debar you people from coming to this country. We want to cut down your numbers. We don’t want you here because you can’t speak English “? If they were to do that, we would know exactly where the Labour party stood. The Opposition is acting like Di. Jekyll and. Mr Hyde-. On the one hand, members of the Labour party are encouraging immigrants- to join trade unions, telling them that we have a standard of living, ia this country that they must, help to maintain. At the same time they are saying to immigrants, “ If you can’t speak English, if you come from a certain country,, we don’t want, you “. Now they are also saying to the immigrants, “ It does not matter what country you- come from. After all you are human beings. You are entitled to jobs “.
The honorable member for Grayndler said people are brought to this country and are unable to find employment here. The fact is that of the 1,200,000 immigrants who have come to this country only 150 are to-day in immigrant camps.
Whether we are members of the Liberal party, the Australian Country party or the
Labour party, we have to realize that immigration is in the best interests of Australia; At present, we are suffering from a temporary housing shortage. It will vanish with the passage of time. We are also passing through a brief period of unemployment which is not serious. But any one who considers for a moment the contribution that immigrants have made to our national prosperity in the last eight or ten years must at least pay a tribute to the immigrants for their zeal and courage and their efforts in stimulating the prosperity which has been Australia’s lot for eight or nine years.
The Opposition cannot have it both ways. It cannot condemn the immigration programme and in the next instant condemn immigrants themselves on the ground that they come from certain parts of Europe and cannot speak English. Opposition members cannot have, their cake: and eat it too. They must be either- for the immigration programme or against it. Yet we find that in the Labour party there are people like the honorable member for Yarra (Mr. Cairns), who issues a newspaper called the “ Spotlight “ in his electorate,, who. on the one hand seems to want the policy-
– Order! The honorable member’s, time has expired.
– I desire- to make a« personal explanation, Mr. Speaker. I have been misrepresented by the honorable member for- Phillip, and deliberately so* Because he had no knowledge at all of the subject on which he was- speaking or, evidently, of my speech. What I pointed out in the course of my speech was that two Greek persons had’ Been Brought to this- country by the government of the day under a- sponsorship scheme, with a guarantee of employment when they got here. I pointed, out that they had been unemployed since the day they arrived and that, in addition- to many other- problems; had the- difficulty of not being- able to speak English-. I did not say that ft was a crime for a person, unable to speak English, to come to this country. All I said was that the difficulties of such people were greatly increased by their inability to speak our language. I feel, too; that I have been misrepresented- also to the- extent that the honorable- member, instead’ of replying to my remarks and making some reasonable attempt to- refute the case I put forward condoned- the unemployment of immigrants Brought here under a promise of employment. I further reiterate-
– Order! The honorable member will not be in order in debating the matter.
– I am not debating it. I conclude by saying that I realize that inability to speak English is apparently not an insurmountable obstacle, because there are many members of the Government parties who for years have been unable to speak English, yet they have- been elected to this Parliament.
Mr. Lawrence. - I, too, desire to make a personal explanation, Mr. Speaker. The honorable member for Kingsford-Smith and the honorable member for Hindmarsh accused me of, while acting in- the capacity of Mr. Acting Deputy Speaker or Temporary Chairman of Committees, having prevented them from speaking from seats other than their own-. The position is- that I ruled at the time that honorable- members were out of order in interjecting at all, but that in interjecting from some one else’s seat they were doing something that was highly disorderly.. I have never ruled on any occasion that, a member cannot speak from. a. seat other than his; own.
.- Last year, I raised in- this House- the state of efficiency in the: recording of import controls and quotas. The Minister for Trade (Mr. McEwen) brushed, aside these submissions in what has become his usual manner; but I- understand that an Investigation has been held info the matter ! raised, and’ that what I said: has been found to- Be- substantially true. Now I raise for the attention of the Minister - and I notified him that I would do> so at the earliest possible moment - the question of what is going on inside the Tariff Board.
Last week, the Minister, for Trade made an attack on a member of the Tariff Board. He said that this member of the board, Mr. Date, had’ made hundreds of complaints. He gave the impression that Mr. Date was irresponsible and’ irritating. The Minister said also that Mr. Date was trying to squeeze unreasonable expenses out of the Government.
The Minister made this attack on a member of the Tariff Board, appointed by this Government, under privilege. He made use of the national broadcasting service to steamroller a private citizen who has very little opportunity to reply. We have been informed over the years that the Minister for Trade is ruthless and unrelenting. I think he proved last week that he is indeed so. Indeed, he appeared to me to be very proud of his performance.
The matter was treated last week as a matter of urgency. It was dealt with by the Minister in answer to an obviously prepared question put to him by the honorable member for Corio (Mr. Opperman), who seems to be employed on jobs of that sort, f first brought this matter to the attention of the Minister over eighteen months ago, and I have had a number of discussions with him during that time. The Minister may well hold the view that Mr. Date is difficult. But he has allowed this matter to go on for eighteen months; he has allowed these issues which are present in the Tariff Board to fester for eighteen months when perhaps a few words from him to the chairman of the board or Mr. Date, or some discussion of the problems or some kind of a ruling, would have cleared the air. But, no! Nothing like that has happened. The Minister, having allowed the situation to exist for more than eighteen months, chooses, at the end of that period, to make in the House a personal attack on a member of the Tariff Board - a personal attack which is broadcast all over Australia. I think it is necessary that the House should realize this.
What are the issues that have been going wrong in the Tariff Board? The Minister has admitted that on many occasions the Tariff Board has shown considerable delay in examining questions that have been brought to its notice. He has also admitted that on many occasions there has been great delay in the presentation of reports by the board. It is very obvious that there is something seriously wrong in the Tariff Board. It is also obvious that, as has been suggested, there is something wrong with a Minister who will permit this kind of thing to go on for eighteen months and then chooses at the end of this period a course that is nothing more than intimidation and rough handling of members of the board who are supposed to serve him as the Minister.
The questions that have arisen inside the board are questions of the way in which the board conducts its meetings. What is a meeting of the board? Should minutes be kept? What are the minutes of the board? And, most partciularly of all, does a member of the board have the right to have his views included in a report of the board? It has been quite clearly brought to the attention of the House that the complaint of Mr. Date as a member of the board was not that any report of the board was altered by the Minister after it came to his hands, but that a report was altered by the board, or some members of it, before it reached the Minister. The Leader of the Opposition (Dr. Evatt) made this very clear in a question asked in the House last week; but the Minister for Trade avoided completely dealing with the question of whether any reports had been altered by members of the board before they reached the Government. That is the complaint that Mr. Date, in particular, has made.
I have in my possession here a photostatic copy of the last page of the cathode ray tubes report, which was signed by Mr. McCarthy, Mr. Clark and Mr. Higgins, members of the board. On that report there is a minute written by Mr. Date, and a long and fantastic comment made by Mr. McCarthy, who was the chairman of the board at that time. I have here a photostatic copy of the report of that board, as it was signed at the table by the board. I have also a printed page of that report, and what might be expected to appear in it, as shown by the photostatic copy, does not appear at all. There is no reference to any of these matters that were raised at the final meeting of the board.
– What has been omitted?
– A minute written by Mr. Date has been omitted, and a comment on that minute by Mr. Clark, Mr. Higgins and Mr. McCarthy. The point I am making here is that the explanation given for this omission was that the minute made on the report by Mr. Date was not relevant to the report because it had nothing to do with cathode ray tubes. That may be a legitimate view to take, but Mr. Date had sought to have this complaint dealt with in every other conceivable way. It had been brought to the attention of the Minister over a period of twelve months and it had been brought to the attention of the SolicitorGeneral, but in no way could this matter be dealt with. Two or three members of the board took the view that this minute should not be included in the report itself because it was not relevant.
The report in relation to Euclid earth scrapers has, at the end, a paragraph which reads -
The board invites attention to the transcript of the public evidence in this case dealing with the circumstances of past importations, at pages 41-50, 78-84, 89-91, 94-96, and 105-118 inclusive.
Mr- Date submits that he desired and tried, over a long period of time, to have included in the report in detail those references to the public transcript. The other members of the board, and particularly the chairman at that time, refused to have this material included in the report. The reason for the refusal in this case was not that the material was irrelevant and had nothing to do with the matter. It was only too clearly relevant. It referred to the way that Mr. Date, as a member of the board, had been refused the right to call members of the Department of Trade to give evidence before the board.
It appeared, according to the public transcript of the evidence, that there was some interchange of information between the parties at the inquiry, which might have raised a very serious matter indeed. It appeared quite clearly that there was a distinct probability that some members of the board were deliberately trying to hide this situation. The exclusion of this material from the report on Euclid earth scrapers was not on the grounds of its irrelevancy, and no reason has been given for that exclusion.
It seems to me that the board was allowed to be a law unto itself. It could decide that black was white, and neither the Minister nor the Solicitor-General, nor any one else, would give any ruling upon any matters in dispute. There are customs and practices in relation to the conduct of meetings. The board should not be a law unto itself. These customs and practices are well known and they should have been taken into account by the Minister and by the Solicitor-General when these rulings were asked for. Mr. Date has written not 150 but 15 letters, and many of these, he points out, were written because a number of his letters were not answered at all.
– What was the date of these reports?
– The report on Euclid earth scrapers is dated 12th November, 1957, and the other was signed on 8th October, 1957. My submission is that it is essential to recognize that individual members of the board have a right to submit their reports. That right should not be checked or blocked by the action of any small number of members of the board. The conduct of the board has, in some respects, been unconstitutional, according to the ordinary practices in relation to the conduct of meetings. Deliberate omissions were made from the minutes of certain board meetings.
– Order! The honorable gentleman’s time has expired.
– I did not have the benefit of hearing the honorable member for Yarra (Mr. Cairns) when he first spoke. I was not in the House then, but I shall read the “ Hansard “ record of what he said. No doubt I have heard most of it, and it has not left me with a very lucid understanding of the point that he is making. In this regard I think I am in a position that I share with most honorable members. I want to make quite clear to the House once more that no report of a Tariff Board has ever been altered, censored, or touched in any respect after it has been forwarded to me or the Department of Trade.
– No one has ever suggested that it has.
– I am just making this clear. I cannot speak from personal knowledge, but I accept the assurance of the Tariff Board that no report of the board was altered after it was agreed upon and before it was transmitted to the Minister or the department. But I do understand that Mr. Date has on occasions made an endorsement - as I have seen and as the Parliament has seen - upon a Tariff Board report at the time that he signed it. These endorsements may have been pertinent to something, but they were undoubtedly irrelevant to the matter being reported upon to the Parliament.
– Tt was clearly relevant in one case.
– If the honorable member for Yarra makes that claim and lets me see the document that hehas, I will not attempt to evade the issue. I have never attempted to evade issues of this kind, and I will not attempt it. The Leader of the Opposition (Dr. Evatt) is trying to interrupt me, but he will not be successful.
– You tried to ruin the man.
– I have not tried to ruin the man. I would be ashamed if I took the initiative in any step designed to that end or likely to have that effect. Indeed, I have interviewed Mr. Date personally on two occasions, and I was glad to have an interview with his friend, the honorable member for Yarra, in which he discussed with me Mr. Date’s position, his problems, and his interests. The honorable member knows that. I have made quite clear that I am notunsympathetic to Mr. Date’s problems. Insofar as the problems were legal ones, I would not set myselfup as the judge of them. I repeat as a Tact that Mr. Date has, not onfifteen occasions, but on close to 150 occasions, addressed communications which mostly have raised straight legal issues. Those have all been sent through my department to the AttorneyGeneral’s Department. I give the House an assurance that wherever Mr. Date has raised a legal point it has been properly investigated by the Government’s legal authorities. The Tariff Board has never acted in a manner defiant of the opinion of the Crown law authorities on those matters raised ‘by Mr. Date.
– I feel it incumbent upon me to answer the charges made by the honorable member for Phillip (Mr. Aston) in relation to Labour’s immigration policy.In this House of late it seems ‘fashionable for most of the members on the Government side to attack Labour on its immigration policy. I think it would be enlightening for most of the dull and weary Liberals on the opposite side of the House to hear the true facts of this policy. Of course, the Government supporters must be jealous of Labour’s success in the immigration field. The honorable member for Phillip referred to the 1,000,000 immigrants who have been brought to Australia, but I remind him that they were brought here under the auspices of the Australian Labour party when it was in office.
For the benefit of honorable members, particularly the new honorable member for
Parramatta(Sir Garfield Barwick), I shall relatethe Labour party’s immigration policy. The honorable member for Parramatta has been accustomed to the (dull and dreary atmosphere of the courts, (criminal and otherwise. Now hehas entered the dull and drearyranksof the Liberalparty, and I am surethat he will ‘be delighted when I afford him the privilege of listening to Labours immigration policy. I am sure that the Sydney “Sun” and the “Daily Mirror “ will also be interested as they have been showing a lively interest in both the Australian Labour party’s policy on immigration and the Government’s lack of an immigration policy. These are the worthy decisions of the Labour party on immigration which were unanimously adopted at its federal conference in Brisbane in March, 1957 -
Conference declares that the MenziesGovernmenthas ‘so gravely prejudiced the immigration programme, that an immediate and substantial reduction in the migrant intakeis regrettably necessary for the orderly development of the Australian economy.
The Menzies Governmenthas -
Failed , to provide the States with funds necessary to provide urgently needed “homes, roads,hospitals, schools, services essential to public health, and other services necessary to maintain civilized standards.
Failed to develop decentralized industries interstate andintrastate for thefull employment of Australians and migrants throughout Australia.
Permitted an anti-social and unhealthy congestion of migrants in the bigger capitalcitiesof Australia,andthereby created the most deplorable conditions of overcrowdingof families of young children of both Australians and migrants in slum dwellings known in the history ofthe nation.
Permitted the unrestricted exploitation of migrants by persons who in many cases are not of Australian nationality, and who have deliberately sponsored migration of migrants in order that they may exploit them.
Developed pockets of unemployment throughout the coastal centres of Australia, with a consequent deterioration in the wage and living standards of Australians and migrants.
Promoted a migrant population of predominantly non-British origin, and failed to attract to Australia British migrants conversant with British political democracy and living standards.
In view of all these circumstances, the Labour party declares that an immediate and substantial reduction in the migrant intake is necessary, until deficiencies referred to are satisfied.
Labour believes that such a reduction should be based upon -
That statement of Labour’s immigration policy should suffice for the honorable member for Phillip. It will be Australia’s future policy on immigration when Labour is returned to the treasury bench at the next general election.
– I wish to refer to a question-
Motion (by Mr. Harold Holt) put -
That the question be now put:
The House divided. (Mr. Speaker - Hon. John McLeay.)
Majority … . . 23
Question so resolved in the affirmative.
Original question resolved in the affirmative.
The following answers to questions were circulated: -
In a number of cases it was not always possible to accept entire family units under the assisted passage arrangements or, alternatively, the migrant workers themselves preferred to travel in advance of their families. It is, therefore, only in respect of these migrant workers who were selected under assisted passage arrangements in Italy and Greece, and in respect of whom Australia has some obligation to facilitate family reunion, that the provisions of the assisted passage scheme have been extended to their dependants. The latter include, as well as the wife and dependent children, fiancees and unmarried sisters. The honorable member will also know that proxy marriages are a practice with nationals of these two countries. The honorable member will also appreciate that there has been an historical pattern of sponsored movement of dependants from Italy and Greece, outside any assisted passage arrangements which may exist. This pattern has not been evident to the same degree in other countries from which Australia is seeking migrants.
United Kingdom Airlines
House adjourned at 11.32 p.m.
Cite as: Australia, House of Representatives, Debates, 19 March 1958, viewed 22 October 2017, <http://historichansard.net/hofreps/1958/19580319_reps_22_hor18/>.