House of Representatives
19 August 1958

22nd Parliament · 3rd Session

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

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Prime Minister · KOOYONG, VICTORIA · LP

– I should like to take this opportunity, Mr. Speaker, to inform the House that during the absence of my colleague, the Minister for External Affairs, the Department of External Affairs will be administered by the Minister for Defence, whilst the Commonwealth Scientific and Industrial Research Organization will be administered by the Minister for Labour and National Service.

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– I address a question without notice to the Prime Minister, as representing the Attorney-General in this House. Will the Prime Minister inform me why the Commonwealth court reporting staff is making a transcript of the proceedings in the Hursey case, in Tasmania, seeing that this is a civil action, and that normally no official report is made of proceedings in either the State Courts of Tasmania or the Tasmanian Parliament? Is there any reason for the making of a transcript in the present case? Has this ever been done before? Is it being done now with the idea of the possible use of the transcript as election propaganda in due course?

Dr Evatt:

– It might be useful both ways.


– It is the first I have heard of the matter. I shall find out about it. I did not fail to notice that the Leader of the Opposition said immediately by interjection that it might be useful both ways. However, in a broadminded fashion, I shall have the matter looked into.

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– Can the Prime Minister indicate the nature of the talks that he had with the Premier of South Australia last week-end? If they concerned factors associated with the Premier’s recent hurried visit to the United States of America can South Australia and the nation be told the reasons for, and the results of, this urgent call to distant places of Sir Thomas Playford?


– I am sure that a public man of the immense experience of the honorable member for Bonython will realize that what the Premier of South Australia wishes to tell South Australia about the business of South Australia and his own errands can be safely left in the Premier’s own hands. I am happy to say that, whenever an aspect of any problem concerns the Commonwealth, the Premier of South Australia is not incapable of coming and having a chat with me, but the conversations are not, of course, a matter of public information.

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– My question is addressed to the Minister for Primary Industry. Has any significant increase taken place recently in the use of light aircraft in the agricultural and1 pastoral industries? Is this kind of aircraft being used for the application of fertilizer, for the sowing of seeds and for spraying purposes in all States? Will the increasing use of aircraft in farming operations further assist production and reduce production costs?

Minister for Primary Industry · LOWE, NEW SOUTH WALES · LP

– The answer to the first part of the question, if I recall correctly the information given recently, is that in ten years the number of light aircraft used for agricultural purposes has increased from one to, I think, 171. In most of the States light aircraft are being used for agricultural purposes. It is expected that there will be quite a substantial reduction in cost through the use of aircraft. As this work is being done commercially I should imagine that these people would not use aircraft unless they thought the results would be satisfactory.

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– I ask the Minister for Labour and National Service: What is the number of persons registered as unemployed or seeking employment according to the latest figures produced? With regard to that figure, observing the fact that the Minister relates it to a denominator or a total which is not the total that has been used over the years, what is the basis for that change in calculation? Is the Minister relating the proportion of unemployed persons to groups of persons numbering nearly 1,000,000 more than is usually the comparative figure?

In other words are employers included In the total to which that number of unemployed relates? If this is so, what is the reason for the change?


– The right honorable gentleman has not stated his question in terms which might be specific enough to enable all honorable members to understand what he is getting at, but I think 1 can understand what he is getting at.

Dr Evatt:

– We want to know what you are getting at.


– I shall try to answer the right honorable gentleman as clearly as I can. First, he asks me the total number of persons registered for employment at this time.

Dr Evatt:

– Being unemployed.


– I think the right honorable gentleman needs to clear his mind on that point. The figure which I give each month is of persons who, at that date, are registered with the Department of Labour and National Service for regular employment. That does not necessarily mean thai, they are registered unemployed, because that figure includes persons who have been referred by the department to an employer but have not notified the department, nor has the employer, of their engagement. It includes, also, a certain number of people who, having registered with the department for employment, go out and find work on their own account but delay or fail to notify the department of their engagement.

I mention, in passing, that the relevant figures on the two census dates of 1947 and 1954 suggested that the total number of persons registered with the department as unemployed was substantially higher than the number of persons who, on the census date, recorded themselves as being unemployed and seeking work. Tt is well to bear that in mind. At the end of July the figure was just over 65.000. Yesterday, T announced the precise figure - I think it was 65,123 but I am drawing on my memory for that figure. At any rate, it was just over 65.000.

Mr Webb:

– That is 11,000 more than at this time last year.


– A great deal can be said on this subject, but I am trying to answer the right honorable gentleman’s question. It can be said also that this figure is nearly 9,000 fewer than the number unemployed at the end of January this year, if that gives any comfort to the honorable member for Stirling. The right honorable gentleman then goes on to say that I relate that figure to some denominator.

Dr Evatt:

– Yes, including employers.


– Presumably he is referring to the statements I have made over recent months on the figures as to the relation which the total bears to the estimated work force. The work force of this country includes a variety of persons, and, of course, employers are among them. Most sensible people understand the work force to include people who are regularly at work. Our unemployment problem, 1 suggest, can be seen in proper perspective when we examine how many of the people who want to work are actually at work. We have done that over recent months. The definition that I have taken of the work force for these purposes is the same definition - there has been no change - as that used by the Commonwealth Statistician when he defines the work force at each census period. Of course, we have to project the figure forward and make the best estimate we can on the basis of information known to us. That estimate is not made by me; it is made by the senior officials engaged in this work in the Department of Labour and National Service.

Before I leave the subject I may say, because I think this is relevant, that one newspaper to-day made a passing reference to the fact that by giving only a partial figure when citing figures during the Budget debate, I had concealed the fact that in the course of last month there had been some increase in the number receiving unemployment benefit. The answers to that are short and obvious enough when the facts are known. In a 30-minute’s speech, one cannot attempt to cover all the detail that it might otherwise be desirable to state.

Mr Webb:

– It is much better to hide the facts!


– No. I am coming to that point. The honorable gentleman can always be relied upon to stick his chin out when it is likely to be punched. I felt that had I given the total of persons receiving unemployment benefit for the month, it would have been misleading in that it might have suggested an upward trend in the number of persons registered for unemployment benefit. On the other hand, if I had chosen to give figures for only the last few weeks of the month, which showed an entirely different trend, that again could have been misleading. So, for the information of the newspaper concerned and of the honorable gentleman who interjects, I state that in the last month there were five weeks of recording - in some months there are four weeks and in other months there are five weeks, according to the way the dates happen to fall. For the week ended 5th July, the number of persons receiving unemployment benefit increased by 384. For the week ended 12th July, there was an increase of 373 and for the week ended 19th July, an increase of 91. For the week ended 26th July, there was a reduction of 351 and for the week ended 2nd August, there was a reduction of seven. If the reductions are set off against the increases, the variation for the five weeks was an increase of 490. However, for the last two weeks, there was a downward trend. Those are the latest figures.


– I desire to ask a question supplementary to my main question. May we take it that what the Minister for Labour and National Service does now is to cause a comparison to be made between the number of persons registered for employment - 60,000-odd - and a figure which includes employers as well as employees, although the figures in the Department of Labour and National Service recording unemployment for at least ten years have never been so treated? Is not the effect, and the intention, of adding employers to the total of employees to reduce the percentage of unemployment? Is not that the very purpose of it?


– No, the position is not as the right honorable gentleman suggests. The Department of Labour and National Service has never in the past, nor has any other Minister exercising the duties of Minister of that department, related the number of persons registered for employment - I repeat that that is not necessarily the total of those who are unemployed - to the figure supplied by the Commonwealth Statistician, of wage and salary earners which I think is in the right honorable gentleman’s mind.

Dr Evatt:

– That is the appropriate figure.


– That is the figure the right honorable gentleman has in his mind, but it is far less realistic to relate the number of persons registered for employment to wage and salary earners than it is to relate the number of persons seeking work to the total number of persons in the work force of the country. If you are trying to get some overall picture of the extent of unemployment existing at any time, you want to know the number unemployed in relation to the number of persons employed. When you are considering the total of persons in employment in the community at a particular time, it does not matter whether they are self-employed or employed as salaried executives or as wage earners. If the right honorable gentleman wants to know how many persons are registered for work in relation to the number of wage and salary earners, then that information is readily obtainable. It is published periodically by the Commonwealth Statistician as a separate item.

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– Can the Minister for Supply tell the House what benefits Australia derives from its co-operation with the United Kingdom on defence studies at Maralinga and Woomera?

Minister for Supply · DENISON, TASMANIA · LP

– It would take quite a long time, I think, for me to assess the benefits that we get from the project, carried out jointly by the Australian Government and the United Kingdom Government, at Maralinga and Woomera. We have access, of course, to everything in the nature of tests carried out at the two places. The great significance of that fact is that we are kept up to date on all the modern technical and scientific methods employed in the production of new weapons. It would be quite impossible for a country of this size to engage in the production of guided missiles, for example, let alone nuclear and thermonuclear weapons, by itself. We just have not that kind of money. In the course of our joint venture, however, the United Kingdom makes weapons which are brought here for testing. Our technicians and scientists are engaged on the testing and proving of these weapons at Woomera, and we gain enormously thereby. The expenditure of the Australian Government at Salisbury and Woomera has a ceiling, of course, of £9,500,000 per annum. Any expenditure above this amount is borne by the United Kingdom - that country’s expenditure is much greater than ours - but we have access to all technical and scientific information that is gained. I would suggest that probably the greatest benefit that we in Australia derive is the formation of a nucleus of scientists, skilled technicians and artisans, who are a prime necessity in modern warfare, in which all the new weapons are required. The first prerequisite in modern and future warfare is a team of highly skilled persons who understand all the new weapons, and I think one of the most important defence potentials that we are developing in Australia is the formation of such a team.

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– I direct a question to the Minister for Labour and National Service. Is it a fact that the number of registered Unemployed in Western Australia is close to 7,000, which figure, according to official information, represents 2.4 per cent, of the work force, including, apparently, employers? Is it a fact that this figure is higher than the figure for two years ago, when an. additional Commonwealth grant was made to relieve unemployment in that State? Is it also a fact that Western Australia, being largely a primary producing State, feels the effect of depressed prices for exports more than other States? In view of the deterioration in the position in Western Australia, will the Minister say whether it is the intention of the Government to treat the matter in a special way, as was done on an earlier occasion?


– I have not the precise figure in my head for Western Australia. I think the proportion of 2.4 per cent., which the honorable gentleman mentioned, is an accurate proportion, calculated on the basis I mentioned a little earlier. Perhaps I may be permitted to add something to what I said to the Leader of the Opposition, in order to indicate the lack of realism in a comparison between the Statistician’s figures of wage and salary earners and of persons registered for employment. The Statistician’s figure ex cludes rural workers, members of the defence forces, private domestics and some others. In other words, a number of persons who are in regular employment in other categories are not covered by this periodical survey.

I should also like to say something about a matter that I hoped I had made clear in the House last week. That is that the total registered for regular employment includes persons irrespective of age, physical condition and sex. That figure was challenged subsequently by one of the honorable members opposite. I have had a further reference made to the facts and have confirmed the information I gave earlier.

The honorable member asked what further consideration the Commonwealth Government would give to the problem of unemployment in Western Australia. We have already indicated in the Budget decisions, the very substantial additional provision that has been made for the various State governments to increase their own governmental programmes and works programmes. No doubt the Government of Western Australia, with the additional funds we have been making available at a time when we have been compelled to budget for a deficit on our own account, will employ those funds in the manner best suited to increase employment in that State.

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– Will the Minister for Social Services inform the House whether the Government has considered arranging reciprocal agreements with Canada and other Commonwealth countries in connexion with social services? If not, will he give early consideration to bringing about such agreements?

Minister for Social Services · RIVERINA, NEW SOUTH WALES · CP

– The need for reciprocal agreements on social services arises when there is a substantial movement of population from one country to another. That was the primary consideration when a reciprocal agreement was entered into between Australia and the United Kingdom Government and between Australia and the New Zealand Government. So far as I know, there is no substantial movement of population between Australia and Canada; but I shall be most happy to investigate the proposition that has been put to me by the honorable member, and if any useful purpose can be served careful consideration will be given to it.

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– Will the Minister for Works inform the House whether plans are in hand for the extension of the Canberra water supply from Belconnen to the site of the Commonwealth Scientific and Industrial Research Organization farm that is shortly to be established at Ginninderra? If this is so, will the Minister take steps to ensure that the supply is carried in mains of sufficient diameter to enable water to be supplied subsequently to the village of Hall? Would the extension of the supply to Ginninderra, if that is accomplished, reduce the cost of providing water for the village of Hall? Can the Minister give an assurance that the supply of water to that village is coming closer?

Minister for the Interior · PATERSON, NEW SOUTH WALES · LP

– No doubt the job to which the honorable member has referred would be on the schedule, but I am unaware of the details of it or the size of the mains that are to be laid, assuming the job is proceeding. I direct the attention of the honorable member to the fact that, if we are to lay bigger mains part of the way to provide for an extension of the water supply to Hall, the cost must ultimately be chargeable to the Hall water supply. This has been a problem over a long time but, as the honorable gentleman knows, there are thousands of hamlets and villages throughout Australia which have not a water supply of their own. Although [ appreciate the views of the people of Hall, they must not think that because they live in the Australian Capital Territory that fact alone guarantees them a reticulated water supply. The matter is still under review.

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– I address a question to the Minister for Primary Industry supplementary to some extent to a question that was asked by the honorable member for Darling Downs. In the Minister’s original statement about aerial agriculture he referred to groups of seven or eight farmers co-operating for the purpose of aerial agricultural operations. In order to encourage aerial agriculture, will his department pub lish information on the advantages of group co-operation, including costs and other relevant data and see that it is distributed widely amongst farmers?


– Some effort has already been made to give publicity to aerial agriculture, but the suggestion of the honorable gentleman is worthy of consideration. I shall see that the facts are obtained and have them distributed to all newspapers in country areas.

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– I wish to ask the Minister for Trade a question about the increasing crisis in the eucalyptus oil industry which is now causing., in the Braidwood district, the unemployment of over 150 men for whom no other employment is available in that district. I ask him whether it is a fact that although the fall in the price of citronella overseas is a factor in injuring the export of eucalyptus dives, yet the sale of eucalyptus phellandra in Australia is being undermined by the increasing imports of camphor of improved quality from Japan at very much reduced prices. I want to ask about the means of obtaining tariff protection for this industry. The Minister has informed me that it is necessary for an application to be lodged by an organization representing the producers. As there is no organization of producers representing the men who distil eucalyptus oil in the bush and, of necessity, there is no means of obtaining such an organization, would he consider or would the Tariff Board consider an application by an individual, provided that the individual makes out a prima facie case? As such an inquiry would probably take a considerable time and as the need of this industry is urgent, could the Government examine the possibility of giving some interim protection to the eucalyptus oil distillers?

Minister for Trade · MURRAY, VICTORIA · CP

– It is not within the power of the Government to give interim tariff protection. 1 think that the honorable member for Eden-Monaro will recognize that problem. I have had some correspondence on this matter with the honorable member, who has been interested in it. I do not carry the details fully in my mind as I have no doubt that the honorable member does. However, a problem may have been created, as far as the honorable member is concerned, by a suggestion which I think I made that a request for a Tariff Board inquiry might come from an organization. As the honorable member has said, there is no producers’ organization in this industry. But I think that there will be general agreement that the Tariff Board, which is very busy, should not be pressed into an inquiry merely because some person in some industry asks for it. It is not necessary that an organization of the industry should make the request. It is merely necessary that the Minister should be convinced that there is, prima facie, a case and that there is a general desire that there should be an investigation. If the honorable member will consult with me or with an appropriate officer of the Department of Trade as to what may represent a sufficient satisfaction to the Minister that such a situation exists in this industry, I am sure that we shall solve the problem that he has raised. I shall be glad to attack the problem from that angle.

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– I should like to answer a question which the honorable member for Wilmot asked last week and upon which I said that I would gain information. It is in relation to the desire to sell Tasmanian potatoes in New Caledonia. The honorable member for Braddon also had previously spoken to me on this matter. The Australian Consul in Noumea has made very strong representations to the authorities there with a view to removal of the restrictions against the importation of Tasmanian potatoes. The authorities have replied in very firm terms that the French Government, due to its exchange difficulties, has been obliged to raise an obstacle to the importation of Australian potatoes. This is an obstacle which extends fairly widely to other Australian goods and which, we are informed, Will last as long as the exchange position is really serious for the French authorities. We are not happy with the situation as it exists at present, and the matter will be raised again with the French authorities through their ambassador in Canberra.

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– My question is directed to the Minister acting for the

Minister for External Affairs. Last week, the Minister for External Affairs answered a question of mine with reference to the Communist World Festival of Youth. Representations have since been made to me regarding the World Assembly of Youth, which convenes in New Delhi later this month. As this latter organization is supported by the democratic nations, and as Australia will be represented by observers only, will the right honorable gentleman explore the possibility of Australian youth being given official recognition by the Commonwealth so that delegates from this country will be able to take their place in future sessions of the World Assembly of Youth?

Minister for Defence · WAKEFIELD, SOUTH AUSTRALIA · LP

– I shall consider the point raised by the honorable member, and inform him of my decision.

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– My question is directed to the Minister acting for the Minister for External Affairs, ls it true that the new Iraqi Government in Baghdad has released documents previously seized by it relating to the Baghdad pact treaties and secret agreements, and that among the documents so released is a cable from the United States which relates to a plan, sponsored by the United States, for Turkey to attack the Middle East countries with the support of the Israeli Government?


– As far as 1 know the Government has no information on the subject raised by the honorable member, but I shall have inquiries made to see whether there is any truth in the report referred to.

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– 1 ask a question of the Prime Minister. As it would appear that generous non-contributory Commonwealth pensions to retired judges will encourage their retirement long before they would normally be obliged to retire because of age or ill health, as evidenced by the action of an ex-High Court judge who has now accepted positions on the boards of directors of two television companies, will the right honorable gentleman consider making such pensions subject to a means test? If the Prime Minister is not prepared to take this course of action, will he give his reasons for placing this class of Commonwealth pensioners in a privileged position?


– The Prime Minister will not. That, perhaps, is a sufficient answer to the question, but I do remark, in answer to his comment, that the honorable member is becoming very, very hard to satisfy. It is not very long ago that one of his great complaints was that the judges were old and should have retired years before. Now, when one of them retires, the honorable member falls into a state of frenzy.

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– Does the Prime Minister approve of the absence of members of Parliament without leave in order to conduct their own affairs as in the case of a senator from Tasmania who has been absent for several weeks appearing in the Tasmanian courts at high fees while he receives his parliamentary salary for non-attendance?


– I fancy there is a rule that one does not discuss the conduct of another place or what is decided by it.

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– I wish to ask the Minister for Labour and National Service a question related to several that he answered earlier. Has the Minister any separate unemployment figures relative to migrants among the statistics that he gives month by month indicating the total number of unemployed? Is the right honorable gentleman aware, as I know from my own experience, that in Tasmania at any rate there are many migrants looking vainly for work? Does the Minister consider it just to bring migrants unrestrainedly into Australia when so many are unable to obtain employment?


– The Department of Labour and National Service does not regularly prepare detailed figures of that kind in respect of Australia as a whole, but I think that we can give the honorable gentleman some useful information on the point, because the department does keep a regular weekly record of migrants who, having come to this country, pass through the various reception camps and are subsequently placed in employment. The honorable member may recall that there was once a bark-up of migrants in the camps because the general employment position was such that they were not so readily absorbed. I am glad to be able to inform him that right through this year we have been able to place migrants regularly and promptly. As they have come into the camps, they have been able to go out into work. Such information as I have regarding applications for unemployment benefit or for employment generally would suggest that persons who have come to this country as migrants, particularly those from the countries of Europe, represent a quite inconsiderable proportion of the total number of persons registered with the department for employment. That is the best estimate that can be made. It rather highlights the fact that most of the employment registrations occurring at the present time are of what might be called marginal employees or persons who are in districts where the demand for labour is not so strong and who are reluctant to leave their district in order to seek employment elsewhere.

Dr Evatt:

– Can the Minister give any percentage for the migrants?


– No. I have none available.

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– My question is addressed to the Minister for Primary Industry. la reply to a question that I asked1 in this House during the last sessional period, the Minister indicated the Government’s unwillingness to continue the war service land settlement scheme beyond next June. In view of the fact that many eligible exservicemen in South Australia will not have been settled on the land by that time, will the Minister leave them with some hope for the future by permitting the single-unit method of acquiring farms to continue after the expected closing date for the scheme?


– I think the honorable gentleman will realize that the same treatment must be given to all States. In other words, we must give the same treatment to ex-servicemen in South Australia as is given to those in the other States. I think T have said that there is not a great deal of new land available for large-scale war service land settlement “ in South Australia. It has been decided to terminate new commitments as at 30th June of next year. Nonetheless, I will have a look at the problem raised by the honorable gentleman, and will arrange for him to be given an answer. I should not like it to be thought, however, that I am making a commitment or that I think there are good prospects of agreeing to his proposal, but I do undertake to look at the matter and to let the honorable gentleman have a written reply.

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– I address my question to the Minister for Trade. In view of the fact that there are surpluses of butter and eggs in Australia and that these products are sold more cheaply in England than here, will the Minister consider making them available to pensioners at prices similar to the English prices by subsidizing their sale, thereby helping both pensioners and primary producers?


– The policy of the Government in this matter is that primary products should be sold in Australia at a fair Australian price. That is the policy that has been approved by this Government, and it stands.

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– I direct to the Minister for Primary Industry a question supplementary to that asked by the honorable member for Barker, concerning the possible closing down of war service land settlement at the end of June, next year. Has the Minister’s attention been drawn to the very grave concern expressed by returned soldiers’ organizations in New South Wales at the possibility, or virtual certainty, of the closing down of the scheme, which will have a very adverse effect upon a considerable number - I think several thousands - of men who are awaiting fulfilment of the Government’s promise to grant them facilities under the scheme?


– I think the honorable gentleman will know that this year the Commonwealth Government did agree to a considerable increase in finance made available to New South Wales and Victorian governments to permit them to carry out an extended war service land settlement scheme during the current year. 1 think that the honorable gentleman’s figure of several thousands as the number of applicants, might, perhaps, be an exaggeration. As the honorable gentleman would well know, the figures are provided to me by the State governments. The estimates are not high, but as estimates they cannot be regarded as exact. I shall obtain them and let the honorable gentleman have them. I have also heard of the complaint of the New South Wales branch of the returned servicemen’s league. 1 think the honorable gentleman knows that that branch has registered complaints with the State Government.

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Military Strength


– Does the Minister for the Army consider that reports of an impending invasion of Dutch New Guinea by Indonesia are well founded? If so, will he indicate whether any attempt has been made to increase Australian army strength in the Territory of Papua and New Guinea, or whether the strength is still limited to the 600-strong Pacific Island Regiment of natives?

Minister for the Army · BENNELONG, NEW SOUTH WALES · LP

– I think the honorable member is quite well aware that he is speaking on matters of high Government policy. That question should be directed to either the Prime Minister or the Minister for External Affairs.

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– As a result of the meeting of the Australian Agricultural Council on Friday, can the Minister for Primary Industry now give the House uptodate information regarding the proposed wheat industry stabilization legislation? When will the appropriate legislation be introduced into this House, and will a poll of wheat growers be taken on the subject?


– The Australian Agricultural Council met in Sydney on Friday and confirmed the decision previously made, and the offer to the Australian Wheat Growers Federation. The offer was received by the federation’s select committee, which has been negotiating on it, and its answer was conveyed to us. The answer was to the effect that the federation wanted the stabilization scheme, that it would not be necessary to conduct a ballot of growers, and that the growers wanted the stabilization scheme legislated for at the next sessions of the State and Federal parliaments. So far as the Commonwealth is concerned, the legislation is in course of preparation, and will be introduced during this session.

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– I direct to the Minister for Immigration a question which is supplementary to those asked by the Leader of the Opposition in relation to unemployment. Are immigrants awaiting employment in the various migrant holding centres throughout the Commonwealth registered for employment with the Department of Labour and National Service? Also, how many immigrants are now accommodated in those holding centres?

Minister for Immigration · ANGAS, SOUTH AUSTRALIA · LP

– I cannot give the honorable member the exact figures but, in the broad, I will say that there are relatively few immigrants at the present time in our accommodation centres in the various parts of Australia. During the five months in which I have been in office, the experience of the Department of Immigration has been that no sooner have immigrants been taken to accommodation centres from the migrant ships in which they arrive than they are very speedily dispersed to all parts of this continent. During the recess, when I was making an inspection of some of those centres, I was amazed to find how relatively few immigrants there were in them. It was my own good fortune to see, while I was making this investigation, how immigrants were going out to employment virtually before my eyes. Indeed, the short time that immigrants remain in these accommodation centres must appear to the House, I venture to say, as one of the most encouraging features of the immigration programme at present, and is a brilliant example of the quick absorptive capacity of this country which will enable it to continue with the present programme.

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– I lay on the table the following paper: -

Audit Act - Finance - Treasurer’s Statement of receipts and expenditure for year 1957-58, accompanied by the Report of the AuditorGeneral.

Ordered to be printed.

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Report of Public Accounts Committee


– I present the following report of the Public Accounts Committee: -

Fortieth Report, together with minutes of evidence - The Finance Statement.

This Fortieth Report of the Public Accounts Committee is one in a series designed to simplify the form and the content of the financial papers submitted annually to the Parliament.

In simplifying the form of the financial documents the committee has been at pains to avoid sacrificing anything essential in the content of the statements. We do not expect that, as a result of the changes recommended by us, the member who runs may read, yet it has been our objective to ensure that he can read without undue strain.

Behind all our objectives is our aim to have all these papers available to the Parliament at as early a date after the beginning of the financial year as possible. Honorable members will appreciate the progress that has been made in this direction if they recall that, in 1951, the Budget was presented on 26th September, while the Finance Statement, the Auditor-General’s Report and the Supplementary Estimates relating to the previous year’s accounts were not presented to the Parliament until May, 1952, almost eleven months after the close of the financial year, when most of their usefulness was lost.

This year, assisted by the several changes which I have mentioned, and other steps, the Budget and these other documents have been presented to the Parliament within seven weeks of the close of the financial year. In those seven weeks, the accounts have been checked and balanced, the manuscripts prepared and the printing done - a memorable achievement for which full credit must be given to the Treasury, the Audit Office and, by no means least, to the Government Printing Office.

Honorable members will notice the omission of shillings and pence in the statements to which I have referred. Some time ago, the committee recommended that this practice be adopted, but the Treasury did not then think it desirable. However, the Treasury has fallen into line with the opinion expressed by the committee in this regard some years ago. The omission of such details has resulted in a big difference in the time taken by the Treasury, the Government Printer and others in preparing these reports so that honorable members will be able to have them well before they deal with the Budget.

Ordered that the report be printed.

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Motion (by Mr. Harold Holt) - by leave - agreed to -

That so much of the Standing Orders be suspended as would prevent the Right Honorable the Prime Minister (Mr. Menzies) and the Deputy Leader of the Opposition (Mr. Calwell) each speaking on the Budget for a period not exceeding one hour.

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BUDGET 1958-59

In Committee of Supply: Consideration resumed from 14th August (vide page 446), on motion by Sir Arthur Fadden -

That the first item in the Estimates under Division No. 1 - The Senate - namely, “ Salaries and allowances, £27,450 “, be agreed to.

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

That the first item be reduced by £1.


.- I should like, first, to join with other honorable members in congratulating Sir Arthur Fadden on his record term as Treasurer of the Commonwealth. The right honorable gentleman has taken in his usual good-natured manner, the criticisms that are always levelled at a Treasurer. I am sure that in his onerous task he has many times acted as an Aunt Sally on behalf of the Government. However, his record is one of which to be proud, and his efforts have been greatly appreciated by all.

Last Thursday night, the House was privileged to hear the maiden speech of the honorable member for Parramatta (Sir Garfield Barwick). His vast store of knowledge and experience as Australia’s most prominent lawyer will, I feel, stand him in good stead in this Parliament. His undoubted ability will also be of great benefit to the Australian people. I extend to him my sincere congratulations on his speech.

In framing the Budget for 1958-59 the Menzies Government had as its primary aim the general advancing of the economy under stable conditions. The problem was to mainlain a steady rate of growth whilst at the same time preserving the stability of prices and costs. The situation faced by the Government has been complicated by the fact that, while Australian conditions are, in the main, quite favorable for keeping the impetus towards expansion going, overseas conditions are much less favorable.

The flexibility of the Government’s thinking was demonstrated in its decision to budget for an overall cash deficiency of £110,000,000. This is the first, occasion since its election to the treasury bench in 1949 that the Government has departed from its principle of balancing its total receipts against expenditure. One may well ask: Why has the Government departed from its previous policy? This was necessary to allow of a further impetus in consumer spending and business investment which’ will, together with the release of credit of approximately £100,000,000 from the central banking system, counteract to a marked degree the effect of lower earnings from our exports.

During the past year Australia’s economy, as a whole, has progressed notably. Total employment has risen, and unemployment, although it has increased to some extent, is still the lowest in any country in the world. However, it was indeed pleasing to learn from the Minister for Labour and National Service (Mr. Harold Holt) both last week and again this afternoon, that the July figures on unemployment again showed a downward trend in a month in which some increases, owing to seasonal conditions, usually take place. As the representative of a working-class electorate, particularly do I sympathize with those who are unable to obtain employment, and I am hopeful that the measures taken by the Government will alleviate the position as rapidly as possible. Further reliable trends are shown in the August figures, and if the policies of the Government do not produce further falls in the number seeking employment, it should not hesitate, in a prosperous country like our own, to take bolder steps to rectify this position immediately.

Let us have a look at the progress that we have made. Last year our factories, which now number 53,220 - there were 41,000 in 1949 - produced goods to the value of more than £4,000,000,000, and in volume more than two and a half times that of pre-war production. They employ 1,100,000 persons. The number of workers in our factories is increasing at the rate of 60,000 a year. Private investment expenditure is estimated to have increased by more than 7 per cent, whilst, in the last eight years, we have attracted and held the confidence of capital from overseas. This is shown by the investment of more than £600,000,000 on private account from these sources. This is progress and an aid to development on a large scale.

During the year the rate of house building continued to rise throughout the Commonwealth. The number of houses and flats completed during the year 1957-58 was 74.333, which represents an increase of 8.6 per cent, on completions throughout Australia for the preceding year. In New South Wales commencements totalled 25.713, which was 5.7 per cent, more than in 1956-57. This total is the highest ever recorded for that State, with the exception of the year 1953-54. One-quarter of the houses now standing in Australia were built during the last ten years. Ten years ago the Menzies-Fadden Government inherited from the Labour Government a housing shortage of approximately 250,000. Since that time not only has this Government provided 53,000 dwellings a year to meet the annual requirements of our population, which has increased by 2,500,000 persons, but it has also been able to reduce the shortage of houses from 250,000 to 80,000, and this figure is continually being reduced.

Housing is primarily a State matter which the States guard closely, together with other State powers. But because, ten years ago, there was a shocking, nationwide shortage of housing materials and labour, the Commonwealth Government has had to provide more and more finance for housing over the years. Last year an all-time record sum of £78,000,000, or onethird of all the money spent on housing, was provided by the Commonwealth. Too frequently the housing problem was referred to as a nation-wide problem, but that time has passed, for in Queensland, South Australia, Tasmania and Western Australia there is virtually no shortage to-day. In fact, in Western Australia, properties with vacant possession for renting and buying are not uncommon. However, in New South Wales there is a shortage of more than half the total backlog of 80,000. That State receives, pro rata, under the housing agreement the same amount of finance as do the other States, yet, under Labour administration, it is unable to make the same progress with housing as the other States which I have mentioned. This is poor consolation for those who require a home in New South Wales. By a continued policy of discouraging the building of homes for rental or for investment purposes, the New South Wales Government has virtually stopped private investment in that sphere.

Mr Forbes:

– Is a Labour government in office in New South Wales?


– Yes; it is led by Mr. Cahill. Commensurate with its desire to have the people housed as speedily as possible the Commonwealth Government has made available record sums of money, but owing to the policy of some States the results have not kept pace with the demand and progress of a fast-growing economy. The Commonwealth Government realizes that the home is the basis of a happy and healthy community and it desires to house our population as speedily as possible. The States, too, have a responsibility in this regard, but if they proceed like New South Wales to stifle individual effort and private enterprise the people will continue to be faced with a housing shortage.

In 1957-58, purchases of most consumer goods increased, and in addition, public works made good headway. Does this suggest that we should not have confidence in the future? Yet, members of the Opposition would have us believe that the economy of this country is stagnant.

Mr Barnard:

– What about unemployment?


– The honorable member should have heard what I said earlier. On the contrary, these good results have been achieved in spite of heavy falls in the value of our exports from £978,000,000 in 1956-57 to £814,000,000 in 1957-58, a decline of £164,000,000 in one year. This is a substantial fall, and it has had a marked effect on Government policy.

The Treasurer (Sir Arthur Fadden) had to tackle three main problems. The first was the fall in the value of exports and in farm income. Our farm income dropped by nearly £180,000,000, or approximately one-third of the farm income for 1956-57. This materially helped to produce a situation in which, for the first time in many years, the total revenue of the Commonwealth for the current year is estimated to be less than the actual revenue of the preceding year by about £9,000,000. The major fall is about £40,000,000 in revenue, from income tax on companies and individuals. That is particularly reflected in the fall in income tax which will be payable from the earnings of primary producers. Secondly, during the current year the full effect of substantial concessions made in the 1957-58 Budget will be felt. These concessions were estimated to cost revenue some £28,000,000 in 1957-58 and approximately £57,000,000 in a full year. They included a reduction in the rate of company tax and pay-roll tax, and the introduction of a revised basis for depreciation allowance, estimated to give trade and industry direct benefits of about £44,000,000 during the present year. Such concession1? are aids to expansion, and their effects would be greater this year than they were during the past year. The third problem that the Treasurer faced was that of maturing debt, much of it for war expenditure previously incurred. This may amount to approximately £80,000,000 in the current year as against £59,000,000 in debt redemption last year.

The Government has seen its way clear to grant Budget concessions. Although they may not be all that one individually may desire, they cover a wide range of items, including repatriation benefits, social service benefits, the encouragement of oil exploration and revision of the national health and Commonwealth scholarship schemes to provide a greater coverage. By widening taxation concessions, and the decision to carry an overall deficiency this year, the Government has acted to keep Australia’s economic growth on the move. As the Treasurer pointed out, more taxation concessions in the present Budget would have fallen upon the Budget for the ensuing year rather than upon the Budget for this year. For my own part, I would have welcomed concessions in the fields of direct and indirect taxation. Particularly do I mention pay-roll tax and depreciation allowances, for such concessions allow a decrease in the cost of manufacture and assist us to be more competitive in our prices. In our efforts to export manufactured or partly manufactured goods, competitive prices are essential and new markets would, in turn, create employment and at the same time assist our balance of payments position. Further concessions to various classes of pensioners would have given a fillip to consumer spending and would have alleviated the hardship that is felt by some pensioners.

The Menzies Government has not at any time hesitated to shoulder the responsibilities that have been entrusted to it. At all times, its aim has been to preserve, consolidate and improve our prosperity. Under this Government’s leadership, Australia has entered upon the most brilliant period of its history, and the framers of the Budget did not think that they should mortgage our future. The Government had been forced previously to bring unpopular measures to bear, for example, the so-called “ little “ Budget. This the Opposition does not let us forget. However, never do we hear from them of the 1953-54 Budget which set a record by slashing taxes to the extent of £118,000,000, and, when taken with the previous year’s Budget, reduced taxation by approximately £200,000,000 a year. At present, a different set of circumstances prevails, and, much as the Government would have liked to grant further relief, on the best advice available, it deemed this imprudent.

Despite some ludicrous and reckless promises held out by Labour leaders at previous elections, this Government has been consistently returned. In 1955, the Government told the people prior to the election that it would bring our external payments situation into full balance. This meant drastic action and the people were rewarded for their faith in honest government, for in eighteen months our overseas balance had improved by £194,000,000. This is particularly important to-day, for we face falling reserves owing to our low prices and the drop in primary income. The Government’s prudent policy of building up our overseas balance has allowed us to take the impact of the fall in prices more comfortably than we would have otherwise. World demand and prices cannot be accurately predicted by any government. The economy may have withstood one set-back at a time, but when a severe drought occurred concurrently with a fall in prices and in demand, it was imperative for the Government to act with caution.

Our overseas reserves are still in a healthy condition, and there are increasing signs that the fall in prices overseas may have reached its limit. If this is so, the drain on our reserves may not be as heavy as expected and a too pessimistic view may not be warranted. If prices show a sufficient gain and sufficient quantities of our products are sold at higher prices, then the Government should be counselled to review the economic conditions in the light of changed economic circumstances and, if necessary, to bring in another “ little “ Budget granting concessions and relief to the community to keep our internal economic condition buoyant.

The Government has always put the nation before popularity and is not likely before an election to abandon this high principle in an attempt to buy votes. Australia’s future is too important, and election promises which cannot be prudently carried out should not be made by either side. Compare this position with the promises made by the New Zealand Labour party in its election last year. In an attempt to gain the Treasury bench, it made extravagant and irresponsible statements to the people of New Zealand. If past form is any guide, one can confidently predict that its counterpart in Australia, the Australian Labour party, will attempt in its policy speech to misguide and delude the people. It has done so previously, and this is the last opportunity for the right honorable member for Barton (Dr. Evatt) to achieve his ambition of becoming Prime Minister of Australia. It would not be surprising if he outdid even the New Zealand socialist party in his attempt to satisfy a personal ambition, rather than to act for the benefit of the nation.

The New Zealand socialist party promised electors £100 rebate on their taxation assessments. This proved to be an election winner. But at what cost? In addition, it promised increased pensions, abolition of the means test at 65 years of age, increased child endowment, free textbooks for children, equal pay for the civil service, sufficient loan moneys for people building homes and full health benefits. There is nothing wrong with this, provided the wherewithal is available to finance these things, but here we run up against the real problem. The socialists tend to forget that any concessions that are given to the community must be paid for and that, if the country is to remain financially sound, they must be paid from taxation. Where does taxation come from? It comes from one source only, and that is from the people! The New Zealand Labour party conveniently forgot to apprise the people of the country’s economic position and immediately after its election imposed licensing on all its imports. It greatly increased income tax and reduced personal exemptions for taxation purposes. Dividends were taxed up to 7s. in the £1 and gift duties were heavily increased.


– Hear, hear!


– It is interesting to hear the “ Hear, hears! “ from the honorable member for Hindmarsh when one mentions increasing taxes on company profits and dividends. I shall come to that in a moment.

Sales tax on cars was doubled, from 20 per cent, to 40 per cent. Petrol tax was increased by ls. a gallon, and duty on cigarettes, tobacco, cigars, beer and all spirits was increased. These increases have severely affected every section of the community, even curtailing the working man’s pleasures and amenities - and I remind honorable members that Labour socialists profess to represent the working man. If this is the method that Labour adopts to pay for irresponsible promises at election time, I am sure the Australian people will have none of it. All honorable members will recall Mr. Nash’s visit to Australia, when he asked for this country’s assistance to get the socialists out of their financial morass. It was rather anomalous, I thought, to have a socialist Prime Minister approaching a Liberal Prime Minister to help him out of his chaotic financial position. Responsible governments, Mr. Chairman, cannot afford to act in this irresponsible way. The Australian people will bear in mind the actions of the New

Zealand socialist party when assessing the true value of the proposals of the Australian Labour party at the forthcoming federal elections.

Throughout the debate, Sir, I have been hoping to hear one constructive suggestion from the Opposition as an indication of how they would handle the economy in a like situation. I have waited patiently, Sir, but in vain. Instead we have heard the old favorite doctrines being expounded. The Opposition’s hatred of combines and of private enterprise has again been manifest in the remarks of its supporters. They have contributed nothing new. It is difficult to understand their attitude of antagonism to private enterprise, for without successful private enterprise the number of jobs available would soon diminish, unemployment would grow as a consequence, and our stable economy, so highly treasured by the Australian people, would be immeasurably weakened. This is a simple fact, for no government without the confidence and co-operation of successful private enterprise can sustain full employment as we have done.

One may well ask whether the Labour party desires full employment. Its record in the past, when it has held office, has shown that Australia at those times has had its worst periods of unemployment. Under the Scullin Government unemployment reached the staggering proportion of 32 per cent. To-day it stands at about 2 per cent., yet Opposition members are at the wailing wall the whole time. One wonders whether they want full employment. Are they sincere in their protestations or are they merely making cheap political capital out of an important matter that affects the lives of all men and women in the community?

As the Opposition’s policy is to socialize or nationalize everything it can get its hands on,’ and to force private enterprise into diminishing importance, how can it hope to foster the confidence that is so necessary, in individuals and in companies, to ensure our expansion and progress? The encouragement of private enterprise is necessary if the working man is to have security and improved conditions. Do the socialists wish to control and direct man-power as is done in the Soviet Union?

In his speech during this debate the Leader of the Opposition criticized the

Government for spending too little. Then in the next breath he described the Government as a spendthrift government and advocated an increase in expenditure, but at no stage did he give us any indication of what the additional amount of expenditure should be on any specific item, nor did he give any indication of what he would suggest as the amount of total expenditure, or where the extra money was to come from. If the past irresponsible and reckless promises of the socialists can be taken as a yardstick, the extra amounts involved would not be inconsiderable. The right honorable gentleman was careful not to mention, as was his New Zealand counterpart on an earlier occasion, that higher taxation would be necessary if additional money was to be spent, and he did not say from what section of the community the additional money would be raised.


– From the very wealthy, of course!


– If the money is not to come from substantially increased taxation, then how is it proposed that it should be raised? The honorable member for Hindmarsh will have an opportunity of answering that question a little later. The printing presses could represent an obvious answer, resulting in inflation, with its dangerous and disastrous consequences. The right honorable member for Barton has been most careful to avoid any reference to these salient matters.

In the few minutes left at my disposal, Mr. Chairman, I wish to speak about the Government’s defence policy. We have heard from honorable members opposite a consistent attack on this Government’s defence policy. I believe that this attack cannot be taken too seriously, because this Government inherited from a Labour administration a completely run-down defence machine. As the Leader of the Opposition was Deputy Prime Minister in the Chifley Government which dispersed and disbanded our forces, sold our equipment or allowed it to rust or rot or to finish up in disposals stores, he cannot be absolved from blame for that catastrophe. Yet in his speech on Tuesday last, referring to this Government, he said -

They began with a rich inheritance from the Labour government of Mr. Chifley.

Let us see what the “ Sydney Morning Herald “ had to say about this matter on 14th August -

Had any emergency arisen during Labour’s last term of office, Australia would have been lucky to find one trained battalion to meet it. The Army, the R.A.A.F. and the Navy were no more than shadow forces.

Since this Government has been in office Labour has continually advocated a cut in defence expenditure. With the advent of modern weapons and scientific achievements, equipment has become far more costly, and a decrease of defence expenditure would mean that much necessary modern equipment would not be available to our forces. Yet Labour continues to criticize the allocation of £190,000,000 for defence each year while at the same time claiming that we have not sufficient modern weapons. We cannot have it both ways, Mr. Chairman. If we want modern weapons to equip our forces, we have to pay for them, and they are most costly. lt may be well to remind the committee that Manus Island was an essential allied base in the Pacific for the protection of our northern defences. The United States of America spent over £50,000,000 on its development, and a proposal was made to the Chifley Government that the Americans should be allowed to remain in this important strategic island, and maintain and operate the base at no cost to Australia. However, the Leader of the Opposition, in no uncertain manner, required that the Americans vacate the island. By so doing, he caused a deterioration in our relations with the United States, as well as sacrificing this essential bastion of our defence. As usual, Labour has been most critical of our defence structure, but it has placed no alternatives before the House.

The CHAIRMAN (Mr Adermann:

Order! The honorable member’s time has expired.


.- The honorable member for Phillip (Mr. Aston) made the amazing statement that the present Government would not mortgage the future of Australia, and that it was budgeting for a deficit. Well, it is obvious that if you budget for a deficit you mortgage the future of the people of Australia.

Mr Aston:

– What rot! The honorable member for Yarra (Mr. Cairns) wanted to budget for a larger deficit.


– I am not concerned with what the honorable member for Yarra said; I am concerned with what the honorable member for Phillip said, and I am pointing out that his contradiction in this respect was typical of his whole contribution to the Budget debate.

Mr. Chairman, in a Melbourne emporium there is a pair of lady’s shoes, the selling price of which is £100. That pair of shoes is imported, and it is symbolic of the effects of this Government’s operations on the economy of Australia. The MenziesFadden Administration secured power in Australia when the work of rehabilitating our industry and man-power, which had been engaged exclusively in war-time occupations, was satisfactorily completed. Al that time, money and men were flowing into Australia to aid in our development. Vast developmental works were in progress. Our overseas balance was more than £800,000,000 in our favour. Conditions generally in Australia were favorable to rapid and great development.

In his Budget Speech in 1950, the Treasurer, describing the state of the economy which he had inherited from a Labour government, said -

It is in times like these that real progress is made.

From the time that this Government assumed office, it has been favoured by good seasons and record prices for our exports overseas which were shipped in record quantities. The return from our exports between 1951 and 1957 was £4,924,000,000. That is equal to the amount that was realized for our exports between 1901 and 1939. In that period, from 1901 until 1939, there was not one six-year period during which Australia did not have a handsome favorable trade balance, but during the period 1951 to 1957, there were three years during which we had record adverse trade balances. One amounted to £370,000,000. Another totalled over £60,000,000 and the third was £39,000,000.

During those years when we had excessive adverse trade balances and record quantities of imports were coming into the country, provision should have been made for the protection of our overseas balances. In the first 40 year-s of federation in Australia, what might be termed the profit on our overseas balances was 20 per cent. of the value of goods exported. In the six years from 1951 to 1957, the favorable trade balance to Australia was 6 per cent, of the amount of goods exported. That does not mean that we showed a profit or an advantage of 6 per cent, in our dealings with other countries, because when the expenses of transportation and insurance and other costs are deducted, we find that there were four years of that period of six years when our balance of payments accounts showed a debit. These debits were enormous. They were £589,000,000 in 1951-52, £16,000,000 in 1953-54, £258,000,000 in 1954-55, and £227,000,000 in 1955-56.

For the whole of that six-year period. Australia was £857,000,000 in the red. That amount of £857,000,000 had to be paid, and it was paid by reducing our overseas balances from £800,000,000 in 1949 to approximately £500,000,000. The remaining amount, of course, was raised by loan, and the loans were obtained in New York, London, Canada and Switzerland by the present Treasurer. Those loans were raised when the prices of commodities were at an all-time high level. Those loans must be repaid and probably the instalments will have to be found during periods when the prices of commodities are down.

Of course, we received something for our exports. In fact, we received £4,632,000,000 worth of imports, and included in those imports were goods similar to the pair of shoes to which I have referred. The ladies’ shoes selling at £100 a pair in a Melbourne emporium to-day are typical of a large proportion of the goods we have been receiving from overseas. We have imported annually goods to the value of £84 per head of population compared with £13 worth per head annually during the first 40 years of federation. Surely, the effect of these imports must be felt throughout Australia.

The value of the output of manufactured goods has reached an all-time high. This production has grown more rapidly and to a greater extent than has primary production. The value of the output of secondary industries in 1938-39 was £203.000,000. In 1956-57, it was £4.022,000,000. The net value of manufactured production per head of population was £56 in 1938-39. In 1955-56, it was £280. Of course, the incomes of graziers have risen considerably because of the high prices received for our exports, but those high incomes do not show the graziers a return on their capital comparable to the vast profits made by the big industrial corporations, the investors in retail businesses and the bond-holding, money-lending section of the community generally. Their profits were immense. General MotorsHolden’s Limited made a profit of 350 per cent, in one year. Other motor selling agencies have declared dividends of up to 100 per cent. Hire-purchase organizations have declared dividends of up to 20 per cent, out of profits of over 30 per cent. Those huge profits have been made by the bondholding, money-lending section of the community without personally assisting in any way in the conduct of business or industry; they are reaping immense harvests.

In direct and indirect taxation, the Treasurer (Sir Arthur Fadden) has extracted from the community sums of money such as his predecessors would consider to be fabulous. As has been pointed out, he has brought down nine full Budgets and one little Budget. In the last of these he has budgeted for a deficit of over £100,000,000. A deficit! He has announced a deficit Budget after a period of a vast return from secondary industry and from exports. Is it, under these circumstances, necessary to mortgage the future of the nation? If the Government considers it necessary to plunge the nation into debt during a period when its returns are the highest in history; when they are fabulous as compared with those of other periods of history; when, as I have pointed out, returns for exports and manufactures for a six-year period have been more than equal to any 40-year period in the history of this country, when will such a Government budget for a surplus? When will it budget for a balance favor able to the people of this country?

Mr Curtin:

– It has not the ability.


– Of course, it has not the ability. It has spent more than it has obtained. What has been the effect upon the people of Australia of the expenditure of these fabulous sums of money in this period of bonanza expenditure through which we have been passing? Have the age pensioners received an increase in their standard of living comparable with the increase in profits of General MotorsHolden’s Limited? Have the ordinary members of the community received increases in their standard of living comparable with the increases in the profits of the hire-purchase businesses? Have the funds been expended upon the development of this country comparable with the increase in the incomes of primary producers in Australia? Certainly not.

In reality, the purchasing power of the average person in this community has been whittled away, to the advantage of the bond-holding, money-lending section of the community. The normal cost of living adjustments to the wages of the family man have been frozen. Child endowment has not increased in purchasing power since it was first paid. To-day, in order to receive the equivalent of the child endowment paid in 1949, the average family man would have to receive at least three times as much as he is receiving now. If the age pensioner were to receive the equivalent in purchasing power of the amount that he received in the days of the Chifley Government he would have to receive much more than he receives to-day. With the vast increase in production per head of population in this country during the six years that this Government has been in office, the purchasing power of the pensioner should not have remained stationary. It should have been increased; but it has not been increased. The welfare of the people has not been promoted.

Has the Government the excuse that it has channelled into developmental works a vast proportion of the wealth that has come into its coffers? Are there great schemes of transportation, road construction, irrigation and water supply being implemented to-day such as were not being implemented in 1949? Certainly there are not. Are vast housing schemes being undertaken so that people may not only get houses, but may get more comfortable houses because of the increased wealth of the nation? No. Certainly they are not. We still have a housing shortage. Are the people of Australia being provided with educational facilities such as they never received before? Are schools being built to accommodate all the children that require education in the community? No. There is a lag in the construction of schools just as there is a lag in the construction of homes. Are the hospitals that are required being built, and is hospital accommodation being provided more cheaply for the people than ever before? No. There are more people on the waiting lists of the hospitals than there ever were before. There is not a suburb in a capital city of Australia in which there are not hundreds of age pensioners, who, unable to care for themselves, are unsuccessfully seeking admission to institutions. The waiting lists are longer than ever before in history.

As the honorable member for Phillip (Mr. Aston) pointed out, the Government has spent many millions of pounds upon defence -over £1,500,000,000. What is there to show for it? Are there vast navies floating on the seas that were not floating there when the Chifley Government was in power? Are there vast aerial defences that did not previously exist in this country? Is our northern gateway more secure than ever before in history? Have land or sea or air bastions been provided to make this country more secure than it was in days gone by? No. I have been to the northern outposts of this country, including Manus Island, and I have sought in vain for evidence of great defences. All we have is more generals than we ever had before, and a more inefficient spending of the vast sums that flow into the Treasury.

Those are the counts upon which the Government should be judged. It should not be judged upon whether things are just going along to-day as they did many years ago with a shortage of houses, with insufficient accommodation for pensioners, with insufficient schools, with insufficient hospitals, with no water supply schemes being made for the future, and with no irrigation projects even being planned. That is not a satisfactory record. Such are the amounts of money that have flowed into the coffers of the Government in recent years that there should have been immense progress and prosperity, shared by all the members of the community. But all that we get is a budget for a deficit and an announcement by the Chief Secretary of Victoria that the people of Victoria will have to pay increased amounts for their electricity for lighting and for power, because money cannot be raised for ordinary expansion by means of loans.

Increased prices for electric power mean increased prices for all kinds of manufactured commodities. Almost everything that the ordinary family man uses is affected by increases in the price of electricty. The price of electricity in Victoria is to rise because, after a period of record years, after the fattest years that this country has ever known, the Victorian Government says that it can no longer raise by loan the amount of money necessary to expand its electrical services, and that it must obtain that money through revenue. But at the same time Custom Credit Corporation Limited and other hire-purchase companies, buttressed by every private banking institution in the country and out of which the private banks are reaping vast profits, can get almost unlimited amounts of money at any time to carry on their trading operations. The necessities cannot be catered for, but the luxuries can. As a result of all these hirepurchase operations more and more of the national income is being whittled away from the ordinary members of the community and placed in the coffers of banking and trading organizations, and in the pockets of bondholders and of others who have money to lend. That is what this Government has done for the people of Australia.

If Australia’s vast production over the last few years had been used to promote rural development we would have had more f->rms. It would not have been necessary to close down the soldier settlement scheme. Australia would not have 23,000 fewer farms than in 1 929. Surely, during the last few years more money could have been devoted towards establishing more farms in this country, particularly since our population was increasing during that time. Whether one looks at the situation from the point of view of the rural section of the community, or from the point of view of the people who live in the cities, Australia has suffered under this Government and must inevitably continue to suffer. A recent bulletin issued by the Commonwealth Bank states that in June, 1957. the prices index for our overseas commodities was 93. In June this vear the figure was 71. As far as the overseas returns for our products are concerned, we are rapidly slipping backwards. Do honorable members opposite seriously surest that if the Government cannot improve conditions when the price and volume of our primary products is at an all- time high, it can do better when the price shrinks and the volume of primary products becomes less? Of course it cannot. The lean years must follow the fat years. The Government stands indicted because it has made no provision for the future, although it has enjoyed the abundance mat existed from 1951 to 1957. The party is nearly over. The average family man - the ordinary Australian citizen - was noi invited to that party. The old age pensioner was not there. The party was for a small section of the community - the graziers, the manufacturers and those interested in hire purchase. The party was lor the people who had made vast profits. Although they will suffer when the parly is over, their sufferings will not be as bad as those of the ordinary man in the street. The average member of the community will suffer the after-effects of the party that the Treasurer has been able to arrange, through a number of Budgets, for the predatory capitalist interests and for the wealthy section of the community.


.- Mr. Chairman, I have listened to the honorable member for Scullin (Mr. Peters) with a great deal of interest, but if I were to correct all the anomalies in his speech I am afraid that I would never get on with my own speech.

Mr Calwell:

– You could not do it, anyhow.


– In answer to the honorable member for Melbourne, there is one point that I should like to correct. The Treasurer (Sir Arthur Fadden) has produced eleven Budgets - not ten, as was stated by the honorable member for Scullin.

I should like to congratulate the Treasurer for the great job he has done in presenting this and past Budgets. The very nature of his portfolio makes it an unpopular one. Quite often he has had to take abuse for things that, after all. are the responsibility of the Government as a whole.

T should like, first of all, to summarize the difficulties that faced the Treasurer in producing this Budget. Our export income has dropped by £164,000,000. Farm incomes have dropped by £180,000.000. That drop in farm incomes has been reflected throughout the economy, as will be seen from the fact that revenue from income tax on individuals and companies has dropped by £40,000,000. Also, when considering the Budget, one must remember that £57,000,000 must be allowed for additional tax concessions that were made in the previous Budget. The amount allowed for these concessions last year was only £28,000,000, so an extra £29,000,000 must be found this year. In addition, the Government must find a further £15,000,000 in tax reimbursements to the States, which automatically increase as costs in the States increase and as our population increases. Social service payments have increased and £9,500,000 of that increase is due, purely and simply to the fact that the number of beneficiaries has increased. Normal costs for war and repatriation services have increased by £2,000,000, without any additional benefits being given. We find, too, that the Government is committed to an outlay of about £102,000,000 to meet the deficit in the loan market. On top of this, £337.000,000 of the national debt falls due for redemption in Australia in the current financial year, as well as £26,000,000 which falls due in England. Looking at all these aspects of the problem, one can see that it is very difficult for the Government to give concessions. It is almost impossible. As it is, it has had to budget for a deficit of £110,000,000.

In spite of all these things, however, the Government has a soul. It has some consideration for people who are in difficulties, and so it looked for what may be termed the Achilles heels in our economy in order to see where help was most needed. It recalled that the 20 per cent, depreciation allowance for primary producers was to expire at the end of this financial year, and it decided to extend the allowance for another three years. It looked into the fishing industry - an important industry which helps us to overcome our balanceofpayments problems. This industry did not receive any of the depreciation allowances that primary producers get. This was merely because, under the interpretation of the law applied by the Taxation Branch, fishermen were classed as hunters and catchers and not as primary producers. The Government has now extended to them a special depreciation allowance of 20 per cent, on plant, and has also brought them into the averaging scheme for the determination of the rate of tax payable by them. Additional taxation concessions have been given to people in remote areas who live under conditions of undue hardship in northern and north-western Australia. The zone allowance in zone A has been increased from £180 to £270, and the allowance in zone B has been increased from £30 to £45.

In addition to these things, the Government has given special attention to oil exploration, which it considers should be maintained at a satisfactory level. This activity is of particular strategic importance. So the Government has decided to increase the taxation deductions that may be claimed in respect of allotment and call money paid by investors in the shares of oil-search companies. The full amount of these moneys may now be deducted instead of only onethird of the amount of calls paid, as previously. We know, too, that the Government pays a total subsidy of £500,000 for stratigraphic drilling in order to encourage oil exploration.

Another matter to which the Government turned its attention was repatriation benefits. It said, “ Who are the people who most need help? “ Those who need it most are totally and permanently incapacitated exservicemen, and their pensions are to be increased by 10s. a week. The pensions in respect of dependants, also, are to be increased. These increases will cost an additional £1,337,000 a year. When it came to social services generally, the Government could not accede to the general requests made by the public, because it did not have the money; so it studied the problem in order to find out who most needed help. It found that those in the greatest need of assistance were pensioners who did not own their own homes or were not living with relatives, and who were paying rent. These people are to receive an additional 10s. a week by way of supplementary assistance. In addition, the means test on the pension has been eased by the raising of the property limit by £500 from £1,750 to £2,250 for single pensioners and by £1,000 from £3,500 to £4.500 for pensioners who are married couples. These proposals will cost £5,887,000 in a full year.

As we have seen from the examples that I have given, this Government has some consideration for people in difficulties, but there is one class of people in real difficulty on whom I propose to concentrate. 1 refer to producers in the dairying industry. If I did not say what I think of the conditions in which these people find themselves today, I could not live with my conscience. I represent an area that is rather depressed at the present time because of the condition of the dairying industry. Later, I will mention the incomes that producers in the industry are receiving and the amenities that they have. But, first, I want to highlight what is happening in the dairying industry in particular and in the exporting industries as a whole. Throughout, my remarks on the dairying industry may be taken as the spear-point of my arguments in regard to the exporting industries as a whole. It is true that the Government has helped the dairying industry, but, nevertheless, I think it either is ignorant of what is happening now or does not want to acknowledge the facts. The White Paper on National Income and Expenditure 1957-58, in appendix C, at page 16, lists a number of items in table 1, under the heading “ Income Payments and Other Charges “. I shall take the year 1953-54 as the base year, because that was the year in which the producer in the dairying industry received his highest returns. We find that, since that year, on a national basis, wages have increased by 27.5 per cent. Company income has risen by 21 per cent. The income of unincorporated businesses - this does not include primary industries - has increased by 24 per cent. Income from rent and interest - this item includes hire purchase and banking - has increased by 64 per cent. Farm income, on the other hand, has fallen by 32 per cent.

Mr Duthie:

– Is that taking all together?


– Yes. The various sections of primary industry are not itemized. It is a strange coincidence that the decline of 32 per cent, in farm income since the financial year 1953-54 is very closely related to the decline in the return that the butter-producer receives. We received 4s. Id. per lb. for our butter in 1953, and now we are receiving 3s. Id. There has been a drop of almost 30 per cent. When we turn to the items listed under the heading “Net Expenditure on Goods and Services”, we find that the biggest item in the financial year 1957-58 is public works, with a total of £479,000,000. Are public works helping the primary industries? Are they helping the dairying industry - this essential industry that does so much to maintain our balance of payments?

Mr Duthie:

– Where they result in the building of roads, they are helping primary industries.


– All these things may help a little. Expenditure on post offices helps a little and expenditure on the railways helps a little, I suppose. But it mostly helps the manufacturers and those who are engaged in secondary industry. That is where the benefit is going. It is not going to the primary producers, who contribute to the important national production that gives us our export earnings.

While I was thinking about public works, I looked up the statistics to see how the number of public servants has increased since 1953-54. The total number of government employees, including those of Commonwealth and State governments and local authorities, was 678,400 in 1953. In March, 1958, it was 753,100 - an increase of 74,700, or approximately 1 1 per cent. It is strange that this Government, which I support, and which believes in free enterprise, and does not believe in socialism or favour an increase in the size of the Public Service, should allow these increases in the number of government employees and, at the same time, permit such a decline in primary production and in the income of primary producers, who really believe in freedom of enterprise, and give effect to their belief by trying to look after them* selves.

We are told occasionally, of course, that we in the dairying industry are inefficient and that we should go out of production. The Government told the Australian Dairy Produce Board that costs in many areas were too high, and that, for this reason, it could not give help. The statistics prepared by the Commonwealth Statistician show the inflation that has taken place in wages. In 1953, when the returns from butter were at their peak, the average wage in Australia was £14 19s. a week. It is now £19 17s. a week, having increased by 39.3 per cent., and this higher average wage is paid to the greatly increased number of public servants and to all those on wages. Yet the return to the butter producer has fallen by 30 per cent, over the same period. Would inflation be the reason why we can no longer produce butter profitably? Of course, we are told that droughts were responsible for the drop in our overseas balances last year, and it is true that they did contribute much to that decline. The Australian export price indices show that the value of wool exported last year fell by 24 per cent., butter by 12 per cent., and meat by about 18 per cent. The value of our butter on the English market to-day is nearly 50 per cent, lower than its value in 1953. What a very poor industry to be engaged in!

But how important is the dairying industry? Let us look at what it contributes to our overseas balances. The latest Year-Book I have been able to obtain is No. 44, for 1958. It shows that the manufacturing industries, for whose assistance most of this expenditure on public works is diverted, contributed only 7.7 per cent, to our overseas balances. The other manufacturing industry shown in the index, refined petroleum products, represented 1 per cent., but considering the importation of the crude oil necessary for these products, the real figure should be about .1 per cent. The dairying industry, depressed though it may be, contributed 5 per cent. - almost as much as was contributed by all the manufacturing industries. If we consider this industry important - and I do - it is time that we did some hard thinking about it.

I have gone a little further in my research and considered what will happen in the future if we do not look after these primary exporting industries which contribute 90 per cent, of our overseas balances. The “Quarterly Review of Agricultural Economics “ contains an article headed, “ Role of rural industries in providing for future Australian requirements “. The writer has estimated what our population will be in twenty years. The article reads -

If there are no changes in fertility and mortality rates, Australia’s population will increase by 2.2 million over 20 years without any net immigration. If the gain from immigration is a modest 50,000 a year, the increase will amount to 3.4 million, and numbers will closely approach 13 million in 1976.

At the present rate of consumption, we shall have just enough dairy products to supply the requirements of a population of nearly 13,000,000, which will be reached in twenty years with an annual intake of 50,000 people - much fewer than the present intake. If there is an increase of 100,000 a year for the next twenty years, we shall be 100,000,000 gallons of milk short. Our production will not be sufficient to meet the demand.

Let us look at the import implications of an increase in population through immigration. The Bureau of Agricultural Economics has found that the value of imports per head of population over the last twenty years has been £80. That is what we have needed for our present programme of expansion. This article continues -

The experience of developing countries such as Australia and Canada in the last few decades has been that, although a large number of “ import replacing” industries has been established, the actual volume of imports per head has not been reduced, possibly because rising real incomes, as well as the requirements of the new industries, have led to the development of fresh or changed import demands. Thus the demand per head for imports, in a context of rising real income levels, is more likely to increase than to decrease during the next twenty years.

The bureau has estimated that in 1976 we shall need to be importing annually £90 worth of goods per person. Surely every one of us agrees that we need this increase in population if we are to hold this country as a free nation. The article continues -

If net immigration averages 50,000 a year (a rate appreciably below that of recent years) a 62% increase in the volume of exports will tie needed between the base period (1952-53 to 1955-56) and 1976. If it averages 100,000, the necessary increase will be 77%; if there is no migration at all, a 46% increase will be needed.

Does this not indicate that we must put all our emphasis on to primary industries and other industries which contribute to our overseas balances? The bureau continues -

The figures also emphasize the over-riding significance of the terms of trade. If the terms of trade improve by 10%, a 46% increase in the volume of exports would provide for the needs of the 50,000 immigration rate but, if they deteriorate by 10%, that rate of immigration would call for a 78% increase.

It is clear that last year the value of our exports fell and that, therefore, we must encourage the primary producer. I wish some of the theorists of the Treasury would read these figures. If they did, they might adopt a different attitude towards the primary producer. The article continues -

Farmers will increase production at this rate only if the economic climate, as reflected in the demand and prices for their products, offers the necessary inducements. Thus, while probable future requirements present a physical challenge to the producer, they also present an economic challenge to the nation as a whole.

That shows that, if our exporting industries are to be saved, we must look after them. The dairying industry is one of those industries. What does it mean to the Commonwealth as a whole? According to the figures of the Australian Dairy Produce Board, an amount of £700,000,000 is invested in the industry. The latest figures of the Commonwealth Statistician show that for the year 1956-57 the gross return to the dairying industry was £188,852,000. That is a lot of money for an industry that is very depressed. What does the Government tell us? It says that we are inefficient, and that we should go out of butter production in New South Wales, Queensland and Western Australia.

Mr Buchanan:

– Hear, hear!


– The Victorians would like it, just as we would like them to go out. We are blamed for being inefficient and uneconomic. The reason is inflation. The milk industry, which has been able to pass on its costs, now gets the equivalent of 8s. per lb. of butter fat, but suppliers for butter production have to take 3s. Id. per lb. Last week, I directed a question to the Prime Minister. I asked him whether the Government would establish an economic committee to examine tariffs, import restrictions, bounties and subsidies in an attempt to bridge the gap that has developed between local and export industries. This same situation arose in 1927, at which time such a committee was formed. The Tariff Board was the result of that committee’s investigations.

In Australia most people are looked after well. For instance, if the wage-earner feels that he is not being given sufficient return for his work he can go to the Commonwealth Arbitration Court. If local manufacturers feel that they are striking too much competition from overseas manufacturers they can ask the Tariff Board to increase tariffs. But what can exporting industries, such as the butter producing industry, do in such circumstances? Practically not a darned thing! All they can do is ask the Government for some sort of assistance in the way of a subsidy or bounty. But what happened in that regard this year? The Australian Dairy Produce Board asked for £17,000,000 - an extra £3,500,000 - in accordance with the formulated policy of the Government for a return to the producer of cost of production on all butter and cheese consumed locally, and 20 per cent, of that figure for butter and cheese exported. I am not going to condemn the Government for not honouring this policy, because there is a loop-hole through which it can get out of honouring it. The Government said to the dairying industry, in effect, “ We are going to give you only £13,500,000. You fix up your own arrangements through the Australian Dairy Produce Board as to the increased price to the consumer “. Well, we have done that this year. We have increased the price, and what is going to be the net result? Because of the drop in consumption resulting from the increased price we shall be worse off. The increase of the price of butter will allow margarine to take away the market that we already have. As a result, we shall have to export to the English market the butter that we cannot sell here, and sell it in England at a loss of £250,000 on every 1 ,000 tons. The Commonwealth Dairy Produce Equalization Committee Limited estimates that this year production will be down by 8,000,000 lb., which means that £2,000,000 is just being tossed down the drain.

What can the Government do about this? It is strange that the Government is so concerned about public works that it has decided to budget for a deficit of £110,000,000 this year. This is the greatest boost for public works I have ever heard of. Merely because the Government cannot get the necessary money out of the primary producers it proposes to create £100,000,000, to inflate the economy and put us dairy farmers in a worse position than we are already in. What is the solution to this?

Mr Webb:

– Change the Government.


– We would not contemplate having a Labour government in office, because we know what the honorable member’s party has done to the dairying industry. Bad as our present position may be, we could not contemplate accepting anything the Labour party might suggest. We know that the Labour party favours margarine, this cheap product, and has been pushing it all the time by asking questions about it in the House. We have to look at this thing from a national basis. The only solution to the problem is an increase in the subsidy on butter and cheese. I am not asking for an increase in the subsidy to the producers, I am asking for an increase in the subsidy to the consumers. We do not want one penny of it. If the subsidy is increased, give the increase to the consumer and so spread it over the whole of the public. The result of such an increase in subsidy to the consumer would be a decrease in the margin between the price of margarine and the price of butter, and we would be able to sell more butter on the home market. However, if we continue under the present stabilization arrangement we will come to the point where we will have no butter for home consumption. We will be exporting the lot. It is physically impossible to achieve, by increasing the price of butter on the local market, the aim of the dairying industry, under the stabilization plan, for a guaranteed price in relation to the cost of a big proportion of butter and cheese. We have now reached the stage where we cannot increase the price any more, the gap between the price of margarine and the price of butter being already so great that the slightest further increase would send butter consumption down hill. I have some figures here from Brisbane which show that in nine weeks last year sales amounted to 33,446 lb., whilst sales for the last nine weeks this year amounted to only 32,171 lb. - a drop of 3.8 per cent. Some notes accompanying these figures say that it was the fact that many of the big chain stores were having give-away sales of butter at below the previous price during the first few weeks of the nine weeks in question which kept sales up even to that extent.

So where are we going? We cannot allow consumption to keep dropping in the way that it is dropping. It has fallen from 30 lb. a head of population to 26 lb. a head of population, its present level. We are not asking for a penny for ourselves directly. We want to see a consumer subsidy such as applies in England where, last year, £48,000,000 was made available in subsidy to the dairying industry, which was the equivalent of 6s. per. lb. for butter. Great Britain had the opportunity of buying butter on the open market for 2s. per lb., but considered its dairying industry so important strategically in the case of war that it paid a subsidy to the industry. Surely the dairying industry is of strategic importance in this country too.


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


.- The honorable member for Richmond (Mr. Anthony) has given the committee an indication of what conditions are like in the dairying industry. To-day there sits on the treasury bench a Liberal-Australian Country party Government that claims to represent the primary producers. The story that was told here this afternoon by the honorable member for Richmond is an indication of the treatment being handed out to the primary producers by this Government.

I support the amendment moved by the Leader of the Opposition (Dr. Evatt) which is, in effect, a censure on the Government. During the course of the debate the Budget has been described as a “ barren Budget “, a “stay-put Budget”, and so on. All I can say is that it is a very dismal Budget. After years of heavy taxation the ordinary income tax payer expected to get some measure of relief when the Budget was introduced. But the Treasurer said to them, “ As you were “. The taxpayers have been left in the same position as they were in after the little ‘horror Budget of 1956. There has been one exception to that in the case of the zone allowance enjoyed by certain people living in certain parts of the Commonwealth, particularly northern Australia. This concession, if you like to call it that, has been given only as a result of persistent representations by all sections of the community living in the areas in which it applies.

The zone allowance was introduced by the Chifley Government and was intended to be adjusted in accordance with the cost of living in the areas to which it applies. But this Government has not previously granted any real increase in the allowance, since its introduction by Mr. Chifley, so as to bring the allowance into line with what was intended when it was introduced and give it some relationship to the cost of living. Time after time, year in and year out, attempts were made to have the Government do something about the allowance. It is true that the proposed increase will be very acceptable to everybody concerned, but it only brings the allowance somewhere into the vicinity of what it ought to have been had the intention of the Chifley Government been followed.

Prior to the presentation of the Budget many interests in the community sought reductions of taxation. There was a strong agitation for reduction of the company tax. Some relief from the burdens imposed by the little horror Budget was claimed, the claim being based on the fact that any assistance given would encourage development. But these representations failed. In the field of sales tax, again strong representations were made, all to no avail. Even on furniture, which is so essential to young married couples arid others setting up home, the increased sales tax, imposed under the little horror Budget, is still retained, although the Treasurer said at the time it was imposed that the increase would be only temporary. The prices of commodities are still rising, but we hear nothing from the apologists for the Government in this chamber or outside it about inflation, which now stalks the land. Apparently they think that the sales tax, although it increases the prices of commodities, does not contribute to inflation.

The motor industry has not had a reduction of sales tax. On the contrary, sales tax on motor vehicles had been increased again under the little horror Budget of 1956. When this impost was made under the little horror Budget, that industry was told that the increase was to be temporary. Motorists generally expected that petrol tax might be cut so as to reduce the cost of transport. To-day, transport has become a very important item in the cost of many commodities. The hotel trade wanted a reduction in the excise duty on beer, and the tobacco trade a cut in excise duty on cigarettes, and so on. But all the representations fell on deaf ears.

This is an election Budget. It has been brought down on the eve of an election and has completely ignored representations from all sections of the community for reductions of the imposts that were placed on many lines of goods under the littlehorror Budget, and of taxes generally. ThisBudget shows that the Government is confident that at the impending election it will be able to gull the people as it has done in the past, lt thinks that all it has to dois to talk about communism. This attitude shows the Government’s utter contempt for the great mass of the people. It has not sufficient intelligence to realize that all the tripe and propaganda it will disseminate at election time about the Comms. will not divert attention from the real issues of the day or from the fact that the Government is still giving the people a belting in the field of taxation as it did in 1956.

I do not want to refer to the question of communism at the moment, because I will deal with it shortly. Some persons such as age, service and widow pensioners are toreceive an increase of 10s. a week under this Budget. In Queensland, from which I come, rents are no longer pegged since the change of government in that State to a Liberal-Country party government. That government is of the same political kidney as the present Commonwealth Government, and since it came into office rents have risen in that State on the average by 53 per cent. Where will this concession of 10s. a week go? It will go into the pockets of the landlords. In last night’s press I read that rents in New South Wales are to rise because of the 10s. rent concession which this Government is to provide. It is quite obvious that the landlords will get the whole of the increase and, perhaps, a little more.

The Budget states that government expenditure is to rise by £71,000,000 to the record figure of £1,575,000,000. This is during a period when, as the honorable member for Richmond (Mr. Anthony) has pointed out, farm income has dropped by £176,000,000 and is one-third lower thao it was last year. The income of primary producers generally is now at its lowest level since the war, but the primary producers have been given no concessions in income tax.

The Treasurer (Sir Arthur Fadden) said that the economy is moving ahead. We want to know where it is moving to. The honorable member for Richmond told us where the dairying industry is going. It is going downhill: it is going out of business.

The Treasurer also spoke about bridging the gap of £110,000,000 between income and expenditure by the use of treasury-bills. This will increase inflation. Yet, not so long ago the Treasurer was moaning and groaning about inflation. To-day, he has forgotten about that because the propaganda effect of his cry has worn off.

All incomes are falling and government expenditure is rising. Overseas incomes are falling and unemployment will reach a record high after Christmas. Yet, the Treasurer says that the economy is moving ahead. He was surely joking, because in the light of existing facts he could not possibly have been serious. He knows that overseas incomes are falling, that the income of primary producers is falling and that there are 66,000 unemployed in Australia. The Government contemplates bringing in 115,000 immigrants during the year. Is this what the Treasurer means when he says the economy is going ahead? At the end of June last Australia held, in overseas balances, £525,000,000 worth of gold and foreign exchange. That was after a fall of £63,000,000 in the second half of the financial year 1957-58. A further fall of from £125,000,000 to £150,000,000 is expected as a result of falling incomes owing to drought and to reduced world prices of commodities. The Treasurer admitted that there was a fall in overseas reserves.

He said that there would be no reduction in import licences. That is the same old story. It was told in 1955 before the last federal election, but in 1956 came the little horror Budget and its imposts and, as I have been emphasizing, they are still with us. As I said before, this Budget shows a contempt for the electors and for the thinking masses. The Government believes that they will not wake up until 1959, when, if it is returned, a large horror Budget will be brought down in the first parliamentary session after the election. The first horror Budget was brought down in 1951. The overseas balances had been laboriously built up by the Chifley and Curtin Labour governments to £843,000,000 but in 1951 they began to fall and eventually, at 30th June, 1952, they had dropped to £362,000,000. Then came the horror Budget. Owing to a substantial rise in the price of wool shortly afterwards, a rise for which this Government was not responsible, our overseas reserves increased.

The little horror Budget was introduced in 1956, against a background of falling overseas reserves which dropped to £355,000,000 in June, 1956. The tax increases of the little horror Budget of 1956 have not been reduced. They are still with us. The picture is clear. Any fall in overseas reserves has had a marked effect on the taxation policy of this Government. We saw it in 1951-52 in the horror Budget. We saw it again in 1956 in the little horror Budget, and once again we have a repetition in this Budget for any student of the financial policy of this Government to observe. As surely as night follows day. the policy which this Government followed in 1951 and 1956 will be repeated and a large horror Budget will be brought down after the federal election in November next, if this Government is returned. It is expected that by 30th June next overseas balances will fall by a further £125,000,000 to £150,000,000. That is the background to the major “horror” Budget of 1959. The taxpayers should compare the conditions of 1951 with those existing to-day. Our difficulties have been increased because this Government’s policy is to borrow abroad. Bond-holders must be paid interest and overseas investors are entitled to their dividends. All this adds to the balance-of-payments difficulties which confront the Government. To-day, the prices of our imports are four times as great as they were before World War II. Last year, we spent approximately £791,000,000 on imports. To that figure we must add the interest and dividend payments to which I have referred. The result is that if our overseas balances, which now stand at £525,000,000, continue to decline at last year’s rate, they will disappear in another six months.

During the depression of 1929-31, our overseas balances by September, 1931, had fallen to one-third of the figure for 30th June, 1929. Prices have risen very substantially since 1931. Even the ordinary householder knows how big the increase has been. It is true that the economy is being sustained by overseas capital. But if the flow of overseas capital were to dry up, as it would in a world depression, our reserves would be swept away and, of course, import licensing would continue. This would mean unemployment and misery for thousands of workers.

Last week, the Minister for Labour and National Service (Mr. Harold Holt) quite airily, quite confidently, and quite breezily told us the unemployment story. It is all very well for the Minister to say that the number of unemployed has dropped by 8,852 since the beginning of the year. That fall is the result of many factors. For instance, in Queensland the sugar harvest is at its peak and the meatworks are going full blast. However, the meatworks will close very soon and the sugar season will end before Christmas. Seasonal workers engaged in these industries will then be added to the number of registered unemployed. The Minister told us that 65,913 persons are registered as unemployed. For these 66,000 people - I suppose many of them are married men - the depression has already hit them. Apparently the Government knows nothing of the soul-crushing effects of unemployment, because to this figure it proposes to add 115,000 migrants. The Government talks about fighting communism, but by its policy it is providing the fertile ground in which Communists can sow their propaganda. The only time Government supporters fight communism is when they are on the election platform seeking the support of unsuspecting electors.

Surely the Government is not blind to the fact that to-day there are 6,000,000 unemployed in the United States of America, 500,000 in Canada and 500,000 in Great Britain. The picture of 1928 is being repeated. Overseas balances are falling, incomes are falling and unemployment is growing. This means that, if the Government flukes re-election to the treasury bench, then early next year we will have not a little horror Budget but a major horror Budget. The Government is either complacent and apathetic or it has not the capacity to govern when the going really gets tough.

Mr Cramer:

– What would you do?


– If the Minister listens, he will hear what I would do. During World War II., the Chifley Labour Government prepared plans to ensure that, immediately the war ended, every person seeking employment would be able to find employment. Its attitude was that the go vernment of the day was morally bound to* ensure that a man was able to secure employment on his discharge from the services. We recognized that although private employment would provide the larger field, the Government should be able to take upthe slack in employment. So, the Snowy Mountains scheme, the Great Southern! water supply scheme in Western Australia and other projects were developed. 1 ask t:ie Minister for the Army (Mr. Cramer), who is at the table, to point to one project that this Government has in hand totake up the slack in employment and toprovide work for the 66,000 unemployed and the 115,000 immigrants whom the Treasurer hopes will come to this country this year. Positions are not available for these immigrants. With 66,000 Australians already out of work, it is morally wrong to bring these people here, to put them intohostels and to give them’ the dole. Australia is not given a very good advertisement when immigrants tell their relatives in other countries of the conditions under which they are living.

When the Chifley Government found” that, as a result of its post-war policy, private employment did not decrease, as happened after World War I., it seized the opportunity, through the honorable member for Melbourne (Mr. Calwell), to implement the greatest immigration plan that this country had ever seen. The conditions permitted great developmental projects of real value to our economy to be put in hand. Again I ask the Minister for the Army to point to any new project of a developmental nature that this Government has in hand to-day. A deficit of £110,000,000 in this Budget, 1 1 5,000 immigrants added to the 66,000 unemployed, falling overseas balances, falling incomes, and payments of interest and dividends to overseas investors all add up to a major horror Budget in 1959, if this Government flukes re-election. During this debate, little mention has been made of inflation; yet inflation is still with us. Prices are still rising and we are suffering from a recession, but this Government has not the answer to the economic conditions of the moment. It is obvious that the inflation in this country is the same as the inflation in the United States of America, which has been referred to by economists there as creeping inflation.

The Treasurer has told us that the expected deficit of £100,000,000 is to be met by the use of treasury-bills. This recalls to my mind a very sad story of 30 years ago. At that time a Prime Minister named Scullin was in control of this Parliament. His Government came to office after a world depression had hit the country. I heard the honorable member for Phillip (Mr. Aston) this afternoon referring to the fact that during the period of office of the Scullin Government the proportion of unemployed stood at 32 per cent., and that to-day the figure is 2 per cent. Let me ask the honorable member: What has happened to the Government’s promise to implement a policy of full employment?

As I was saying, a world depression had hit us at the time when the Scullin Government came to office, and 32 per cent, of our workers were unemployed. Nevertheless, Mr. Scullin approached the then chairman of the Commonwealth Bank Board, Sir Robert Gibson, asking for an advance of £15,000,000 by way of treasury-bills to enable the Government to carry on. Sir Robert Gibson refused to make such an advance. This is, perhaps, an old story, but it is a true one. Sir Robert Gibson at first refused, but finally granted the request on condition that wages were slashed, salaries cut, and age, service and other pensions reduced. In effect, Sir Robert Gibson, and not the elected parliamentary government, was the dictator of this country. Is it any wonder that when the Labour government secured the necessary numbers in both Houses of the Parliament, it amended the Banking Act to make it impossible for the same situation to arise in the future? The Banking Act has been amended by the present Government since it has been in office, but, as I am sure the Treasurer is happy to reflect, no attempt has been made to delete the provisions inserted by the Labour government, which make the government responsible for banking policy and gave full control over banking and the issuing of credit to this Parliament, and not to some retired bedstead manufacturer.

What I have referred to is now, of course, history, but T suggest that early next year we will again hear the cry. “ Cut costs! “ I heard the honorable member for Richmond (Mr. Anthony) say this afternoon that the dairying industry has been told to put its house in order, and to cut costs. When this cry is heard about cutting costs, it always comes from persons who really mean that wages and salaries should be cut. Is this the economic and employment policy being followed by the present Government? Is this what is behind the Budget we are discussing? What about the Government’s policy of full employment? Is the Treasurer about to retire because he does noi want to be the bunny to go around slashing wages and living standards generally? ls he getting out because he will not be a part) to that policy? Is that what is behind this Budget? It would appear so, when we look back at what has happened in the past, and have in mind the attitude of those opposed to the Labour party and who support the present Administration.

The worker in industry, the farmer, the small businessman, all want to know the truth. They do not want these highsounding phrases and this talk about millions of pounds by the Treasurer. They want the Government to give this House and the people the true economic picture and the policy that the Government proposes to implement to meet the conditions that will confront us next year.

In the short time remaining at my disposal I wish to refer to a statement made a few nights ago by the Minister for External Affairs (Mr. Casey). When referring to the fact that this Government took office from the Chifley Labour Government, he said, as reported at page 261 of “ Hansard “ -

We had a run-down defence system.

Standing Orders will not permit me to express what I think about that statement, but I will say, with all due deference to the Chair, that the statement is quite untrue. If it is in keeping with other statements that have been made to this Parliament by the Minister, he has been taking us for a ride. Perhaps he will agree that the only knowledge he has is of external affairs, and that he does not know much about defence. When the Chifley Government went out of office in 1949 it had switched the economy from a war-time footing to a peace-time basis with a minimum of dislocation. During the period between 1946 and 1949 plans were made to build a modern navy. A government of the same brand of politics as the present one had, in 1939, left this country pretty well defenceless. We can all remember in 1939 that motor boats, yachts and fishing launches were commandeered to play a part in our naval defence. It is a sad story but, unfortunately, it is very well known, and there is no need for me to discuss it. Labour is a peace party. It is not a war party nor a jingo party. We believe in defence. In time of war the paramount consideration of any government should be the defence of our country’s shores. Labour believes in defence, and in this regard let me simply refer to the records of the Chifley and Curtin governments.


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


.- During this Budget debate honorable members have dealt with many subjects of great importance, but I feel that there is one matter which transcends all others at this time. I refer to the survival of Australia as a nation. I believe that our generation inherited a country singularly blessed and free. When we inherited this country from our forebears we were given the right to have an equal say with all Australians in controlling its destinies. Each and every citizen of Australia, and Australians only, have some say in shaping the destiny of this, our native land. If we in our generation should fail to pass on to our own children the same privilege and right, that they, too, may contribute towards shaping the destiny of this great country, then as a generation we will have failed. But there is no section of the Australian community more clearly charged with that responsibility than we, the members of the Australian Parliament. This above all is the responsibility of this Parliament, and particularly is it the responsibility of the Government - to ensure that Australia as a nation will survive, and that our children will inherit from us the right to shape and mould the destiny of our native land. That this right, this heritage, is, at the present moment, in danger, must be clear to anybody who has studied the trends that have been developing to our immediate north. I believe that if we are to make an appreciation of the danger that exists to our country and the possibility of the loss of the greatest of all freedoms, then each and every one of us should study developments immediately to the north of our country.

We know that at the end of World War II. Soviet Russia was able to drag the mainland of China behind the iron curtain. We know that Lenin has stated that it matters not if four-fifths of the world is destroyed so long as the remaining one-fifth shall be Communist. That that goal is gradually being attained must be clear to every one who has studied the trends developing in the north. At the conclusion of World War II. Russia not only embraced the entire Chinese mainland, not only Sinkiang province and Outer Mongolia, but also Sakhalin and the Kuril Islands. Almost immediately after World War II. a civil war was waged within China, with the Communist forces receiving their direction from Moscow. Eventually the Communists were successful in driving the Chiang Kai-shek regime out of the mainland. Having driven Chiang Kai-shek’s forces out, they launched armed aggression upon that most peaceful country, Tibet. After all these years, there is now in Tibet a life and death struggle in progress. Reports indicate that no less than 50,000 Chinese have been killed in Tibet as well as 15,000 Tibetans, and the Tibetans have vowed that they will fight to the death to gain the right to control their own destiny. In 1950, an attack was launched on Korea by the Chinese Communists and but for the fact that Syngman Rhee, the President of Korea, called on the world for assistance and was answered by the United Nations, the whole of Korea would have been dragged behind the iron curtain. Now, as a result of a decision made by the United States of America, Korea is a divided country and only South Koreans have the right to control their own affairs.

Then, driving southwards and towards Australia, we saw how the Communist forces were able to take control of the Viet Minh which had begun as an idealistic, nationalist organization to get rid of French colonial control. The Viet Minh movement had started with the highest ideals and the objective of securing the right to mould the future of their country. It is common knowledge now that the Viet Minh was taken over by the agents of Moscow. As a result, Viet Nam is a divided country. South Viet Nam is a free country existing perilously at the southern extremity of the Indo-China peninsular.

To the west are Laos and Cambodia. In Laos the Viet Minh Communists overflowed and formed the Pathet Lao, and divided the country which was unified only at the cost of allowing Communists into the Cabinet, and to-day Laos and Cambodia are on the verge of collapsing behind the iron curtain. Recently, in the elections in Laos, sixteen of twenty-one seats contested by the Pathet Lao, the Laos Communist group, were won by its candidates. The situation in Laos now is critical and Laos could well go behind the iron curtain at any moment. To the south is Cambodia, which recognized red China only recently. Within Cambodia, the forces of communism are as strong as they are in Laos, and Cambodia must collapse. To the west is Thailand, a monarchy whose government, at the moment, refuses to recognize red China. It is a conntry in which communism is outlawed, but it has allowed Chin Peng, chief of the Communist terrorists who are operating in Malaya, to establish his headquarters in Thailand not far from the border of Malaya. That government, on 19th May, agreed to permit a Communist-inspired Afro-Asian conference to be held in Bangkok.

To the West is Malaya, where Tengku Abdul Rahman is trying to maintain the independence of his country. He can maintain the independence of Malaya only if he is able to continue to develop the economy of his country, but it is being sabotaged by the new trend in the Communist trade war to dump goods on the world markets. We know that at this moment Soviet Russia is dumping supplies of tin on the world markets and that she purchased supplies from South America to give further impetus to that move. This is having a disastrous effect on the internal economy of Malaya. To the west of Malaya, there is Burma, where the Government party was recently split. Both U Nu and U Ba Swe are leading extreme left-wing parties, and both of them claim to be followers of the doctrine of Marx and Lenin. We know that U Nu is faced with the possibility of defeat on the presentation of his Budget in the parliament; and if he is defeated on a vote of no confidence another general election will be required within two months under the Constitution of Burma. Such an election could only favour the Communists who maintain and control their own armed forces in Burma.

The situation in Burma must have a profound effect on Malaya, and events in Malaya must be affected by the situation that is developing now in Singapore. In March of next year an election will be held for the first time in Singapore to permit the people to control their own future, but political observers believe that the Peoples Action party will gather the highest proportion of the votes. The Workers party, under David Marshall, is expected to gain the secondlargest number of votes, and the Labour front under Lim Yew Hock, which is the only anti-Communist party of the three, is expected to run third. So, it is reasonable to assume that Singapore will follow a line owing allegiance to Moscow.

To the south of Singapore lie Indonesia and Australia. We know that in Indonesia Soekarno has embraced the Communists as his friends. In the Parliament of Indonesia, there are no fewer than 39 members of the Communist party. We know that Dr. Soekarno’s friendship with the Communists in Indonesia has created considerable disturbance in the minds of that section of the people of Indonesia who are politically educated. It has caused such a great division of opinion that Dr. Soekarno realizes that he is not as secure as he was previously. If he is to rally the people of Indonesia behind him, he must do something spectacular with which all Indonesian political parties will agree. He knows that even the rebels in Indonesia and every one in the outlying islands, no matter how scant their knowledge of politics, are agreed on one point, and that is that Indonesians must drive the Dutch out of West New Guinea. I believe that Soekarno plans such an attack in the immediate future.

When the news first broke that Indonesia was purchasing aircraft from Russia, the Foreign Minister, Dr. Subandrio, made an announcement whilst he was in the Philippines that those aircraft were not to be used to attack the rebels in Indonesia. Both Soekarno and Dr. Juanda have made statements making it clear to the rest of the world that that equipment will be used in an attempt to drive the Dutch out of West New Guinea. We know that Soekarnohas under his control in Indonesia no less- than 122 battalions of troops in the permanent army and, with a population of 85,000,000, he has unlimited reserves for his forces. In February of last year, in exchange for 3,000 tons of rubber, Soekarno was able to obtain 4,000 Russian jeeps. No other interpretation can be placed on Soekarno’s intention than that the Indonesians are about to launch an attack on West New Guinea. Only yesterday, Dr. Helmi, the diplomatic representative of Indonesia in Australia, issued this statement with respect to West New Guinea -

As most of our Australian friends have realized now, the West New Guinea . . . issue is the perfectly straight forward one of colonialism or national independence, of national unity or national fragmentation, of the rule of law or the rule of force, of negotiation or fait accompli.

So I suggest that the Australian Government has to examine the situation in Indonesia. We have to recognize that we in Australia, with a population of only 10,000,000 and a work-force which I doubt reaches the 4,000,000 mark, are limited in what we can contribute in the event of any decision to participate if and when Soekarno launches his attack on West New Guinea. This is a matter which has to be solved now and it has to be solved if possible by peaceful means. This is a matter on which we have to enter into negotiations with our allies and determine what can be done in -order to bring about a peaceful settlement -of this situation. We, in Australia must -continue to live on the most profound of friendly relationships with those people who are our neighbours. We should, if possible, avoid any action of an aggressive nature at this stage. We must recognize that West New Guinea is of great importance to the people of Australia because it is in our front line of defence, just as are eastern New Guinea and Papua. I believe that Australia must insist that Soekarno shall not be conceded control of West New Guinea. His -country is bankrupt and would not be competent to govern West New Guinea. Indonesia is far too young to embark on a further expansionist programme. I sincerely hope that action has been taken to refer this matter to the United Nations Security Council in order that we may be able to bring reason to bear and to prevent Soekarno from launching his attack on West New Guinea which could well involve the whole of this area of the world in a hot war. We know that Soekarno has already pur chased 60 MIG 15’s and MIG 17’s, 32 Ilyushin 28 bombers, and 13 Ilyushin transports.

But it is not only the situation developing in New Guinea and the other countries to which I have referred which is of tremendous importance to Australia. We have to take some cognizance of the cold war which we are losing day by day; more and more victories and more and more scalps are being added to the Communist Chinese and the Communist Russian forces. The greatest weapon that they are now using is trade. Recently, whilst I was in Japan during the election campaign there, I found that the Japanese people had built up an export trade with red China which represented 10 per cent, of their total export income. On the eve of the election campaign in Japan, red China cancelled all trade with Japan, causing great economic chaos to the Japanese people. The Communist broadcasting stations in red China continued to broadcast to the Japanese instructing them that unless they were able to get rid of Mr. Kishi and his government and unless they elected a government friendly to Communist China that country would cease, for all time, to trade with Japan. Mr. Kishi rightly announced to the people of Japan that this was a blackmail attempt by Communist China to interfere in the internal affairs of his country. The people of Japan listened to Mr. Kishi and he was returned to office.

Communist China has retaliated with the same weapons that Russia has been using, lt is well to bear in mind that spokesmen for both Russia and China have stated that trade is not something in which they engage for economic reasons; they trade only for political reasons. This has been borne out by the pattern which is developing in the Pacific or Asian area at this time. Red China is purchasing goods from all over the world at any price which it is necessary to pay for them, and flooding traditional Japanese markets with those goods at a price which is 10 per cent, less than the price normally paid for the same commodity manufactured in Japan.

Trade missions from Communist China are visiting those countries and saying to the buyers, “ How much do you pay for that article from Japan? “ When they are told the price they say, “ We shall sell it to you for 10 per cent, less “. How much Communist China loses on the deal she does not care because Communist China is aiming at the destruction of the Japanese economy and, with the destruction of the Japanese economy, China will find it comparatively easy to embrace Japan behind the iron curtain and, by so doing, to strengthen the Communist axis. The addition of Japan’s huge industrial production and huge maritime fleet would bolster the economy of the Communist areas and give them a greater chance to wage the cold war on the other countries of the world.

We, the people of Australia, must assist Japan and resist this foul scheme. We in Australia, because of our trade policy, until now have ignored this situation. Recently, Australia sold a vast quantity of sheet steel to Communist China. Our traders in Australia are showing that there may be some truth in Karl Marx’s claim that capitalism contains the seed of its own destruction. I am inclined to believe that that is true, particularly when 1 observe the hunger and greed of the traders in the free countries of the world; particularly when I find that the United Kingdom is prepared to release more and more goods for trade with Communist China; and we find that those goods are being used only to destroy the free world and for no other purpose.

Why does not the free world realize that Communist China is trading, not for economic reasons, but purely and simply to destroy the free world and make the ambition of Lenin, Marx, Khrushchev and other Communist leaders come true that the whole world shall be controlled from Moscow? So, the countries of the free world may lose their freedom to determine and mould their own destiny. It would be of no use for the Australian Government to refuse to allow the export of this steel to China, because it could be purchased very readily from Europe. In view of the fact that China is buying these goods merely to destroy the economy of other countries, why do not all the free countries of the world, recognizing this situation, come to an agreement that all trade with Communist countries will cease forthwith? Let us take the initiative for a change and throw their internal economy into pandemonium.

I am afraid that the hunger and greed of the traders of the world would not tolerate such an agreeement But I believe that it would be far better to have a little unemployment as a result of refusing to trade with Communist countries, than to have wholesale unemployment as a result of the sudden chopping off by China of any trade that we do build up with that country, as she has done with Japan. This is the most powerful weapon that the Communist forces can find to drag into their orbit not only Japan but other countries.

We have seen the effect on the economy of Malaya. Malaya is struggling very desperately to build up its economy so as to resist the infiltration of Communist people. I hear the honorable member for Parkes interjecting. He is a friend of Mao Tse-tung. He is a friend of the Chinese Communists. He is the man who came into this Parliament and lauded these people because they had done such a remarkable job. But the honorable member for Parkes did not tell us that conditions are better in Communist China to-day than they were in 1949, because from 1921 onwards the Communist party engaged China in continual civil war. It betrayed the people of China and brought about an internal situation that did not allow the country to develop. The honorable member did not tell us that, when the Japanese invaded China and the Chinese army moved to combat those troops, it was betrayed by the Communist army. He did not tell us that. He did not say that by 1949, after almost 30 years of continual civil war, the economy of China had been destroyed by the sabotage of the Communists.

Even a bunch of school girls, if they had been in government, could have improved on the conditions that had been created by the Communists and which existed in 1949. The honorable member for Parkes did not go to Formosa to see the higher standard of living that exists there. The honorable member, who has been interjecting and carrying on a conversation at the table with the deliberate intention that it should be heard over the microphone, did not give one reason why red China should be recognized. He merely claims that there are 600,000,000’ people in red China, and he says that they cannot be denied recognition. What would Australia gain by recognizing red China?

Would our diplomats have freedom to move about within red China? It is fairly well known that in red China no diplomat is allowed to move beyond a twelve-mile radius of his embassy without a special pass. If he applies for a special pass he is lucky to get it within three months.

The truth is that the United Kingdom has realized that she made a mistake in recognizing red China. As a listening post the embassies in red China are completely worthless. Diplomats in red China are unable to move to the scene of incidents in order to report on them. The only worth-while listening post to events in red China is Hong Kong. The United Kingdom thought she would improve her trade relations by recognizing red China, but every year her trade deficit increases. When the United Kingdom sought permission to send a trade mission to red China in the hope of improving her trade balance, the Communist Government of Mao Tsetung - that friend of the honorable member for Parkes - flatly refused to allow such a mission to enter the country. Our diplomats would suffer the humiliations and embarrassments that diplomats of other countries have suffered. Not only are diplomats forbidden to move freely within the country, but even if they are able to speak Chinese fluently, they are not allowed to do so even when giving instructions to their servants. They must speak the language of their own country and give their instructions through an interpreter appointed by the Government of red China. If they obtain permission to travel to a particular area in the country, they can do so only if they are accompanied by a person appointed by the Communist Government. Those escorts are appointed for one purpose only. Supposedly it is to protect the diplomats, but in fact the purpose is to hamper them.

Australia would gain nothing by giving diplomatic recognition to red China, but we would lose much. We would offend our real friends in Asia, and we should consider those friends and not our enemies. Our friends are in Malaya, Formosa, Japan, Thailand, Southern Korea and Southern Viet Nam. We have many friends in Burma and other Asian countries - people who are fighting Communist domination, people who want to keep for themselves the right to mould the future and the destiny of their own country so that they can pass on the same right to their children. Our recognition of red China would not help them. If we were to recognize red China we should lose prestige in the eyes of many Chinese in other parts of Asia, and at the same time increase the prestige of red China.

If ever this Government makes any attempt to recognize red China, I shall cross the floor of the House, even if I am the only member of the Government parties to do so, and I shall vote strongly against the proposal. I urge the Government to seek audience with the other Great Powers of the world, particularly the United Kingdom and the United States, with a view to bringing to their notice the blackmailing tactics that are being developed by red China in Asia. An agreement should be reached to boycott all trade with all Communist countries, because for the Communists that trade is not for economic purposes, but purely for political purposes, and is used to attain Russia’s target, namely, to take away from every free country and all free peoples of the world the right to maintain and control the shape of their own destiny; and to vest control in Russia over the economy of the countries, and the very lives, of the people.

Mr Haylen:

– I should like to make a personal explanation. What I have to say deals not with the subject of the speech by the honorable member for Lilley (Mr. Wight), but with his remarks concerning the microphone. The honorable member said that while he was speaking I was talking to the honorable member for Bonython (Mr. Makin) and that our remarks were going through the microphone. 1 assure the honorable member that I had put the latch down on the microphone and that I was speaking quietly with the honorable member for Bonython about an important matter concerning the control of the House while I was here. I was not trying to jam the honorable member’s broadcast to his constituents. It suits me better that they should hear him in full.


.- The honorable member for Lilley (Mr. Wight) has probably made his best speech in this House, although I do not agree with a major part of what he said. His line was just what one would expect from a supporter of the Government, namely, to sheer off completely from the Budget that is under discussion, a Budget that means so much to the people of Australia and their everyday needs. The honorable member took us on a tour through the Far East and the near East, and pointed out to us the problems and the dangers that are associated with trends in those countries to-day.

Mr Forbes:

– Do you not think that the Communist threat is important?


– The honorable member for Barker (Mr. Forbes) asks whether I think the Communist threat is important. Of course I think it is important, but Australia has been a long time realizing that it is important. This Government has been a long time doing something about it - other than to talk about it at election time. It is a bit late in the day to be concerned about the starving millions in Asia. It is a bit late to start wondering what is to be done - and done in a hurry - to protect this country and, as it is claimed, to look after our friends in other countries. But who are our real friends? It is not easy to know who are our real friends. I do not claim to have had the experience of the honorable member for Lilley, who has journeyed to many countries, but I say that we could well look within our own family of the British Commonwealth of Nations and find the same fears that affect people in countries like China. What is to be done for the street sleepers and beggars of India, Pakistan, Singapore and Ceylon? It is useless to condemn without careful thought the march of the people of Asia. Of course, we do not want them to follow communism. The honorable member for Barker should use his influence, if he has any, with the Minister for External Affairs (Mr. Casey) and the Prime Minister (Mr. Menzies) to see that Australia embarks on a real mission of friendship, to show those within the British Commonwealth that we regard them as our equals and our partners, because I am afraid that their problems to-day are real, and it may be that they will decide that our way of life, whilst they may desire it, is not doing things quickly enough for them. I am sure that most parliamentarians in India, Pakistan and Ceylon to-day, who understand the position, want to remain within the British Commonwealth. They want to retain our parliamentary and democratic way of life, but above all they want to put food into the empty bellies of their people. Anybody who has been to those countries will know that they want to retain democracy, but democracy works too slowly. It cannot get things done quickly enough to fulfil the needs of their people. So we who live in countries more fortunate than those I have mentioned should try to give them some real assistance.

The Colombo plan has done a good job, and I am pleased to see that the Government has done more in this Budget by way of technical aid than by capital aid. I think we have gained more from having Colombo plan students come to Australia, live among us for a time and get to know our ways, and then go back to their own countries to tell their own people how we live, than we have gained from all the buses and railway engines and carriages that we have given to the people of Pakistan, India and Ceylon. Those items of machinery are very costly assets, and doubtless of considerable value to the nations to which they are given, but the ordinary people in the street would not have a clue where these gifts had come from. What they learn of us, they learn from their own people who come here and, on their return, tell them how we live, and let them know that, despite the fact that we are administered by a Menzies-Fadden Government, conditions in Australia are far superior to those in their countries. The people of Pakistan, India and Ceylon are crying out for assistance and for the support of the hand of friendship. Within the British Commonwealth there are fears and distrust. Probably even in this Parliament there are fears and distrust.

Mr Cleaver:

– On the honorable member’s side of it.


– If the honorable member looks on his own side of the Parliament honestly, he will see that the suspicions and distrust in the ranks of Government supporters are no less bitter than are any on this side of the Parliament or anywhere else. Australia has to look ahead and try to evolve a plan that will keep the countries of the British Commonwealth tied together and to Australia. On a previous occasion, I advanced a proposal that I considered would do much to promote goodwill and friendship between the countries of the British Commonwealth and ourselves, but I was told, by interjection, that it was just one way of spending money. We could do a great deal of good if we were to invite to Australia large numbers of ordinary rankandfile parliamentarians from Pakistan, India and Ceylon - particularly some of those in the extreme parties, such as the Trotskyites and the Communists, and not merely the conservatives. We should let them see Australia and get to know really well how we live. We should prove to them that democracy can do the job that is needed, and they would then return to their own countries as true ambassadors for our way of life.

At present, there are among these other peoples fears and suspicions. As the honorable member for Lilley said, they fear that the hungry, greedy traders of the world will do nothing to halt the march of communism. Unfortunately, the memories of these other nations within the British Commonwealth are not so short that they have forgotten their fear of the hunger and greed of the traders of the United Kingdom, whose operations have left scars on their national minds and made them suspicious of every move we make. Our first task is to hold out the hand of friendship on a basis of equality, and not patronizingly, looking down on them. We should treat them as our equals and recognize their worth. If we do that, they in turn will resist any tendency to turn to communism, and will repel the invasion of communism at their borders.

I remarked earlier, Mr. Temporary Chairman, that the honorable member for Lilley had said little about the Budget. Of course, there is little to say about. It has done nothing. Probably, it has not taken much away from any one, and it certainly will do very little for any one. It provides for some increases in benefits for pensioners in particular circumstances. However, we are still waiting for a detailed explanation of these, and I hazard the guess that, when it is given, it will reveal that very few pensioners are to receive any benefit from the proposals.

The Leader of the Opposition (Dr. Evatt) described the Budget well when he said that this was the Budget of a tired and lazy Government with little care for the well-being of anything but its own bureaucratic machine. He said that this is the ultimate in Budgets, and that it is the last of its kind that Australia will see. The right honorable gentleman added -

There is a handful of useful proposals, but nothing more. The Government deserves strong censure, and the purpose of the Opposition is to declare that censure.

Sitting suspended from 6 to 8 p.m.


– Prior to the suspension of the sitting, I mentioned that the Leader of the Opposition had described the Budget as being that of a tired and lazy government, and that is a very good description. The Treasurer (Sir Arthur Fadden) has seen fit to retire from politics, and it is unfortunate that he is not retiring with a better record.

Mr Anderson:

– Hot air!


– The honorable member for Hume should be quiet, because he comes to this Parliament only in fits and starts and I have no doubt that, in view of this Budget, after the next election his place will probably be taken by the former member. The Budget does not commend itself to the people of Australia, and the honorable member comes from an electorate which is similar to my own. It is one of those marginal electorates that change with the political pendulum. If he can get any consolation from this Budget, he is a superman. Undoubtedly, it is a Budget which offers nothing to the people of Australia.

The Government, once again, has forgotten to honour its promises of the past. It has forgotten the needy people and it has forgotten the wants of the Australian people generally. The Prime Minister, who is in the chamber, emphasized, prior to winning control of the government from the Australian Labour party in 1949, that in the matter of child endowment the Australian people could look forward to some real action from the party which he led. I am sure that if the Prime Minister, the Treasurer, or any of the other Ministers, promised something as an individual, his word would be honoured, but a promise made by them collectively as a government is forgotten. They care little for their pledge to the Australian people.

In relation to social services, the Prime Minister said, in his policy speech of 1949 - he has not changed much in appearance, as is shown by the photograph appearing in this pamphlet -

During the new Parliament we will further investigate this complicated problem with a view to presenting to you at the election of 19S2 a scheme for your approval.

He was talking about the means test. He said -

Meanwhile, existing rates of pension will, of course, be at least maintained. We will, much more importantly, increase their true value by increasing their purchasing power.

That was a solemn pledge given by the Prime Minister prior to his attaining the important office that he holds to-day. What has he done to honour that promise? Let us examine the position in relation to child endowment, which was. first introduced in Australia by a Labour government in New South Wales, and then, on a Commonwealth basis, by a non-Labour government in 1941. In 1945 the Chifley Labour Government took into account the rising cost of raising a family and increased the rate to 7s. 6d. for each child after the first. In 1948 the Chifley Government increased the rate to 10s. Thus, in five years of Labour rule, child endowment was increased from 5s. to 10s. a week, although the cost of living had increased only very slightly. In 1948, when Labour fixed the child endowment rate at 10s., the basic wage was £5 16s. a week. To-day, it is nearly £13; but the child endowment rate remains at the same level.

Age and invalid pensions have certainly received some attention since that time. They were £2 2s. 6d. a week in 1948, and they are £4 7s. 6d. a week to-day. This Government ,at least appreciated that there was some need for adjustment, but it has not, by any means, given justice to the pensioners. It has not given them the amount of pension to which they are entitled, but it has at least given them some increase to compensate for the ever-rising cost of living. The Government, however, has completely forgotten all about child endowment. It has forgotten that there are children in this country, and mothers depending on the Government and expecting it to honour the promises it made.

The Minister for Labour and National Service (Mr. Harold Holt), when talking about unemployment, refers to the prosperity of the country. Of course, it is a prosperous country for people who have plenty of money. It is prosperous for those people with vested interests, but not very prosperous for pensioners like those in Adelaide, who depended on newspaper appeals, recently, for money to enable them to buy blankets and firewood. It is not of much consolation to the pensioners to be told that the country is prosperous. The Minister is a great one for referring to the percentage of the total work force that is unemployed. Why does he not talk about the number of people unemployed? He admits that they number over 60,000. To him. apparently, that is only a small number, and he brushes it aside. But those 60,000 people are important. In the same policy speech to which I referred earlier, the Prime Minister mentioned full employment. He said -

The aspiration for full employment is no monopoly of the Socialists. We are all human beings. Yet it is clear that full employment is to be the Socialists’ election slogan. This is a false issue. We shall confidently devote ourselves to full employment and the avoidance of depression.

Why does he not honour his promise in relation to full employment? It is all very well to talk about only 60,000 people being unemployed. If the Prime Minister or the Minister for Labour and National Service were one of those 60,000 people who are out of work and know that for many weeks to come they will have to rely on the small pittance of unemployment relief paid by the Government, he would be quick to do some probing and to demand that a government which pledged its word should honour its promise.

The people of Australia will want to know why the Government has not honoured its pledged word, and why it is always content to use fanciful figures and percentages. It would not matter if only 1,000 people were unemployed. To every one of those 1,000, unemployment would be a very serious matter.

Housing is also a very serious problem. It is true that some real progress in certain directions has been made, but to-day young people particularly, who are endeavouring to purchase homes, find that, because of inflation brought about by this Government, the ownership of homes has gone beyond their reach. Even if they are able to pay the deposit required, they are unable to pay the high interest rate, for which the Government must take credit. Dear money! In South Australia, the State Bank has recently increased its maximum loan for a house to £3,500, but a person who borrows that amount of money will have to make repayments at the rate of nearly £24 a month. There is not a wage earner in the country who could afford to do it unless he were prepared to send his wife out to work. That is what this Government has brought about: It has forced wives to go out to work so that their families may get enough income to enable them to buy homes and keep themselves supplied with the other necessaries of life.

The high interest rate has pushed money out of the reach of ordinary people, and that money has gone to swell the huge profits that the hire-purchase companies are making to-day - the hire-purchase companies which are, of course, in effect, the trading banks of Australia. There are, for instance, the Australian and New Zealand Bank Limited with an interest in Industrial Acceptance Corporation; the Bank of Adelaide Limited and Finance Corporation of Australia; the Bank of New South Wales and Australian Guarantee Corporation Limited; the Commercial Bank of Australia Limited and General Credits Limited; the Commercial Banking Co of Sydney Limited and the Commercial General Acceptance Limited; the English Scottish and Australian Bank Limited and Esanda Limited; the National Bank of Australasia Limited and Custom Credit Corporation Limited. We do not find the Commonwealth Bank of Australia in the list of banks financing hire purchase, because that bank, which could have kept interest rates low by lending money at a low rate of interest, was sabotaged in that respect by this Government. It was directed by the Government to cease such operations because it was keeping down the interest rates charged by other banks. It is interested in hire purchase in a small way, but only in a small way.

It is interesting to see the profits that the hire-purchase companies make from the repayments of people who borrow from them in order to buy motor cars and other goods. I do not suggest for a moment that there is anything wrong in people borrowing money in this way; but there is undoubtedly something wrong with a system which allows the hire-purchase companies to make such huge profits. I have here a booklet which sets out the rates charged by hirepurchase companies in respect of motor cars. Let us say, for instance, that a company has £10,000 which it is prepared to make available for hire-purchase lending. It makes ten loans of £1,000 each for a term of three years. The interest charged on each loan of £1,000 will bring in an extra £323. By the end of twelve months a total of £4,410 will have been repaid to the company in respect of the ten loans. It now has this money available to lend out. It uses it to make four loans of £1,000 each with a currency of two years, and one loan of £400, also with a currency of two years. Two years after it has begun its operations it will have available for lending another £7,000 in repayments of loans it has already made. It uses this amount to make fourteen loans of £500. each for twelve months. The company will receive back £564 for each of those loans of £500.

The ten loans of £1,000 each with a currency of three years bring the company in return a total of £13,230 in repayments; the four loans of £1,000 for two years bring £4,848 in repayments. The one loan of £400 for two years brings in £504; the fourteen loans of £500 for one year bring in £7,896 in repayments, bringing the total return from the £10,000 originally lent to £26,478. That is not a bad return from £10,000 over three years. No wonder the hire-purchase companies can afford to pay high interest rates to those who invest money in them. No wonder they have been able to grab the money market.

Mr Aston:

– Why do not the States do something about it?


– Why! Why does not this Government do something about hire purchase in this Australian Capital Territory and the Northern Territory, in both of which it has complete power to act? Never mind about passing the buck to the States! They have already made a move, and it is up to this Government to show that it is prepared to join forces with the States in this respect. The trouble, of course, is that there would be great difficulty in getting action against hire-purchase companies from this Government, because as everybody knows these same trading banks supply the Government parties with finance for election purposes, and the Government cannot offend the people who are supplying the money. So we can expect the same old story in the future. The already high interest rates will be increased. Homeownership will be put beyond the reach of the workers, and the hire-purchase companies will continue to flourish.

This Government stands condemned for a Budget that will do nothing for the people, which gives nothing except what is a glossedover false pretence by which the Government is making a show. It proposes to give an extra 10s. a week to pensioners in certain circumstances. But it is only a makebelieve show, and I venture to suggest that we shall find that there are very few pensioners who will be entitled to the extra 10s. The Minister for Social Services (Mr. Roberton) intimated to me the other day in reply to a question that it is not intended to make the special allowance available, for instance, to a widow who is struggling to pay off her home because, according to him, she is improving her equity in that home.

Age pensioners, particularly those living alone in their own homes, are in a deplorable state to-day. As a result of inflation local government rates, water rates and similar charges have increased to such an extent that the pensioners find themselves unable to meet them. I came across two such cases in my electorate in the last month. One was a pensioner who lives in a fairly good residential area. He has lived there for years, having built his home there, and he hopes to die in that home. His rates to-day are nearly £60 a year. He is totally dependent on his pension. The only suggestion that is made to him as a way of getting out of his troubles is to sell the house and get out of it. If any one is entitled to some consideration, people like that are entitled to it. Perhaps if he lived in a State other than South Australia he could expect some relief in regard to council rates, because governments in certain of the other States have given local government bodies power to fix a lower rate for pensioners than for other ratepayers. But the Premier of our Liberal party government in South Australia has steadfastly refused pleas by local councils to amend the Local Government Act so that pensioners may pay less in rates than do people who are better off.

The Government is taking the people for a ride. The Prime Minister shrugs his shoulders. He expects that the Government parties are going to be returned to office without submitting any real policy to the people. I give him the warning which is contained in information that has already been given to me. People in my electorate who have always supported the candidate representing the Prime Minister’s party, and have never voted Labour in their lives, have told me that they are not content to let the members of this Government, or any other government, shrug their shoulders and take advantage of what they think is a good political situation, and to deny benefits to the community because they believe that they will be re-elected in any event. The Government stands condemned, and I have no doubt that the people will carry a real motion of censure on it at the right time.

Undoubtedly, the Opposition will fail to carry the motion of censure which is implicit in the amendment moved by the Leader of the Opposition (Dr. Evatt). We have not the numbers here to carry the amendment, but we submitted that amendment on behalf of the people of Australia. We may be defeated here, but the people will have the final say, and the quicker the day comes the better.

Prime MinisterKooyong · LP

– I think it would be less than just for me not to acknowledge the extraordinary vigour of the speech to which we have just listened from the honorable member for Kingston (Mr. Galvin). But the concluding passage pf the speech persuaded me that one must never listen too much to gossip. The honorable member collected a little gossip to the effect that chronic Liberal voters are now determined to vote against the Government. Very odd! If I placed equal reliance on gossip I could tell the honorable member that when I was in Adelaide recently I was told that lifelong Labour supporters said that the honorable gentleman had no chance of winning his seat again. So I think we can cancel out the gossip, and perhaps we can cancel out some of the vehemence too, because I may tell my honorable friend that for a long time now we have been hearing people say, not perhaps with equal vehemence, and certainly not with equal skill, that the Government is doomed. The Government stands condemned, or it falls condemned! I have heard that said. I heard it in 1951.

I heard it in 1954, I heard it in 1955 and I will no doubt hear it quite a lot in 1958.

Mr Pollard:

– Crying wolf.


– As long as the honorable gentleman describes himself as a wolf I shall not bother. But I pay tribute to the honorable member for his powerful remarks about hire purchase. I must say that I compliment him upon the skill with which he turned away from the better part of 3,000,000 people in New South Wales, who enjoy the benefits of Labour government and who sustain whatever burdens there are under hire purchase, in order to persuade us that what ought not to be done by a Labour Premier in New South Wales for 3,000,000 people ought to be done by a Liberal government for 40,000 people here. That, I venture to say, is a rather extravagant and - if I were not anxious to avoid being offensive - a rather eccentric form of reasoning.

But after all, I do not want to be particularly dealing with the last speech. My real purpose to-night is to say something of an explanatory kind about the Budget which has been so mildly criticized so far - at least so far as I know, mildly in this chamber. I think a few things ought to be said about it and a few things ought to be made clear about it.

In the first place, I regret that my distinguished colleague, the Treasurer (Sir Arthur Fadden) cannot be here to-night because of other events. I should like to say in his presence how greatly I compliment him not only on this Budget but also on its predecessors and how deeply we all are in his debt for the work that he has done in financial management over the last eight years.

Mr Ward:

– He would never believe you.


– Not only would he believe me, but I am happy to say that the clear majority of the people of Australia also believe me.

Mr Curtin:

– That is the joke of the year.


– Well, even you must be allowed to enjoy one joke a year. I must say that ever since I saw the honorable member I thought that when he looked in the mirror each morning he had a joke every day - 365 days each year and 366 in a leap year.

Mr Curtin:

– I have got everything bar Japanese eyebrows.


– You must not borrow that joke. That Japanese pearl of wit fell from the honorable member for East Sydney and the honorable member must not endeavour to steal that also. In the last eight years some Budgets have been severe and some Budgets have made - though it is now forgotten - great relaxations of taxation. But in the result, the economy of this country has been remarkably stable and progressive. Unparalleled expansion has occurred. I do not think anybody could seriously challenge that. There has been an unprecedented growth of population - a fact which is frequently forgotten - which has amounted to the better part of 2.000,000 in the last, eight years.

Employment has been high, outstandingly so in the world. Social services have expanded and improved. They have improved because new social services have been created. The rate of housing has been very high and, as we forecast some little time back is now notably improving. Our credit overseas, an element upon which a great deal of the development of Australia has depended, has been higher in the last eight years than ever before. Sir, so characteristic a feature of our economic landscape have these facts to which I have been referring been that they are actually taken for granted by the annual critics.

The outstanding features of the present Budget are these - and I just want to refer to a few: First of all we have accepted an overall cash deficiency of £110,000,000. I want to remind honorable members that that is without precedent in time of peace. In one year, at the height of the war, the treasury bill issue went up to about £170,000,000 under remarkable, astonishing, extraordinary circumstances, when every kind of control and device must be resorted to. But in time of peace the acceptance of an overall cash deficiency of £110,000,000 is without precedent. And, Sir, not only is it without precedent; it involves taking risks. Let us look at it sensibly.

Mr Peters:

– My word!


– It does; it involves taking risks, but they are calculated risks. After all, there are two conflicting elements in the Australia economy and that is why I say this is a calculated risk to take. The first element is that inflation remains a danger and could be revived in vigour if a run-down of our overseas balances required further import restrictions, and if increased budgetary expenditure produced increased unsatisfied demand, that is to say, a greater volume of purchasing power than we have goods and services to satisfy. I hope that no honorable member will overlook the fact that our overseas balances have run down in the last twelve months.

Mr Curtin:

– Dangerously.


– Honorable members opposite think of running down in another sense. They run down people; I was talking about balances running down.

Mr Edmonds:

– You would not dream of running anybody down.


– Of course not; it is unnecessary in your case. But our overseas balances ran down in the last financial year, and it is anticipated that they will run down to some extent in the current year. We must, therefore, always be alert, as we have been, to protect the balances against any running-down process which becomes inveterate, which looks as if it might get beyond the point of being safe. Of course, one of the means of doing that is to tighten up import restrictions.

Mr Peters:

– And to borrow overseas.


– That is not a matter which we contemplate doing. But I referred to this because I want to make it clear that there are inflationary elements and we are not to forget about them. The honorable member for Parramatta (Sir Garfield Barwick) in his maiden speech the other night referred to that aspect of our economy. But there are also at this time in our country deflationary elements at work. The principal one is the gross fall in farm incomes, a remarkable fall of onethird in the course of a year. This is not a fall which began and ended in one year but carries itself, with some modification and effect, into the next year, and, perhaps, the year after. The results of the gross fall in farm incomes will continue to show themselves for some time to come. And the sharp falls in metal prices, which also reflect themselves in falling export incomes, are also factors which help to create consequential effects, not confined to those who engage in farming or mining, upon incomes and upon demand.

I referred to those two factors - the inflationary elements and the deflationary elements - in order to indicate that any responsible government must not be governed by slogans on those matters, but must set itself down to form a judgment as to how far, without unduly accepting the risks of inflation, it can produce an effect which will counteract deflation - a deflation which otherwise might arise from the fall in the export income. I hear somebody ask what are we going to do. I will answer that question. We have accepted the radical course of budgeting for a large cash deficiency in order to counteract the deflationary effect of falling exports. The point that astonishes me about the whole of this discussion, public and parliamentary, is that it has been so inadequately realized that to accept a cash deficiency of £110,000,000 in a country such as this in one year is itself radical finance, because it means that we are creating purchasing power to that extent beyond the level of production and services. Therefore, if I may say so, this is a rather adventurous policy. It is a policy which very few people would have contemplated fifteen or twenty years ago. It is a policy which we have learned to understand and, at need, to apply because of the lessons that we have learned from the somewhat restrictive policies of 25 years ago.

As the “ Financial Times “ in London recently pointed out, this course of budgeting for a large cash deficiency is a risky course, but I was interested to see that that publication dso observed that it was the right risk to take if Australia had faith in the continued growth of her national economy. As we have that faith, we have decided upon this poli-v. What some critics have failed to see is that the Budget does not play safe, but accepts risks. To regard it as unimaginative is to treat a huge cash deficit of £110,000,000 as inadequate. Honorable members might as well hold their peace unless they are prepared to say that the Budget deficit should have been more - and I have not heard them say it - or that they would have reduced the Budget deficit by increasing taxation - and I have not heard them say that. This is the first moment of almost blissful silence in the course of my speech. I suppose if some of them say, as I am sure the right honorable member for Barton will, “ It should have been £210,000,000 or £310,000,000”, some people will say, “ Yes, that would not have been a bad idea “. But the last people to say that it was a good idea would be those who would suffer from the gross inflation that followed, and they would prominently include the old people on fixed incomes or pensions for whom the honorable member for Kingston has just made a passionate address.

The second feature of this Budget is that there are no substantial reductions of taxation. That is true - omitting a variety of items of a comparatively small kind. But, Sir, there could not be unless we did one of two things - unless we further increased the amount of the cash deficit, which 1 do not think any responsible person would want to do, or unless we reduced to a material degree Commonwealth expenditures. I shall come hack to that a little later on. because that is a bone of contention with some people, but I just repeat it: We could not reduce taxation in any real sense in this Budget unless we increased the amount of the cash deficit to that extent or reduced Commonwealth expenditures to that extent. As to tax reductions, I point out - I know it has been pointed out before, but I repeat it - that there are already tax reductions in this very financial year 1958-59 as a result of the full effect of reductions in last year’s Budget. The reductions in last year’s Budget were only partially effective last year. For example, last year’s tax reductions announced in the Budget gave a benefit in the last financial year, ending on 30th June of this year, of £28,000,000; this year, the benefit will be £57,000.000. In other words, in the year 1958-59, in which we are now living, we will have in-built tax reductions, irrespective of what appears in this Budget, of approximately £30,000,000.

The other aspect of this matter, which I want to emphasize a little, is this: To increase the cash deficit to an extent which would afford material tax relief - something that amounted to £10,000,000. £20,000,000, £30,000,000 or £40,000,000- would be reckless and irresponsible. It could not be seriously advocated, except by people who think that the future ought to be allowed to look after itself and that the loan raising and conversion problems of 1959-60, to say nothing of the costs and prices problems of that year, should be recklessly ignored. Nobody would respect a government which took the short-sighted view and said, “ As long as we get through this year, we do not care what happens in the future “. We are not prepared to take short views of that kind.

To turn to the other branch of this matter, could we then have substantially reduced Commonwealth expenditure? 1 say “ substantially “ because, although every £100,000 or every £1,000,000 of economy is worth while and should constantly be sought, no tax reductions of the kind sought could be produced without many millions being added to deficit or subtracted from expenditure. Now, Sir, where are the increases in expenditure? Before I answer that question, I will make the simple observation that Australia is a great, growing, robust and exciting enterprise. It embraces within its boundaries many successful and growing private enterprises - steel works, factories, banks and retail stores - whose expenditure rose year by year as customers and demand increased. In case that was not heard by my somewhat murmuring and distinguished friends on the other side, I will repeat it: This country embraces within its boundaries many private enterprises of all kinds, from steel works to stores, and their expenditure grows year by year as customers and demand increase. I do not use those words lightly because they have to be remembered if we are going to consider accurately the expenditure of governments.

To apply what I thought of as a woodenpegging motion - perhaps a wooden-headed pegging motion - to the expenditure of government alone must mean one of three things. The first of the three is that we regard governments as in their nature, whatever their party politics, wasteful and their servants as especially incompetent. Quite frankly, I do not believe it. The ablest administrative men in the Public Service of Australia will compare more than favorably with those outside.

Mr Cairns:

– They have to be capable, considering the Ministers they have to serve.


– Well, I am even capable of believing that the great departments of State are as well-managed as any newspaper, if I may be allowed to make such a revolutionary statement. I have given the first alternative. The second is this; if we believe that we must peg Commonwealth expenditure, then it must be because we have not realized that governments, by capital works and public services, are called upon to provide much of the foundation upon which private enterprise expands. This is, I believe, something of profound importance. People talk about government works as if, in their nature, they represent something detached from the life of the people, whereas every time one hears of some admirable expansion of private industry one must realize - and it is not forgotten by those who conduct the industry - that the expansion was made possible only by the provision of transport services, light, power, roads, schools, housing and the myriad services that are provided in Australia by governments. Therefore, to say that we must peg government expenditure is to suggest that you do not understand that a great deal of it provides the foundation for the expansion of private enterprise. In the third place, I do not think we would want to put down some artificial peg on Commonwealth expenditure.

Mr Coutts:

– Who suggested it?


– It has been suggested by two or three persons - not by the honorable member who has just interjected, because he would be the last person to do so. But it has been suggested, shall I say, outside. We would not make such a suggestion unless we had forgotten that a rapidly increasing population, increasing, as it has, by 2,000,000 since the war, means increasing demands upon government, which must be met if our standards, including our standards of living and social welfare, are to be maintained and improved.

I regard those as elementary remarks, and I apologize to the committee for inflicting them on it. They are, however, points that are very frequently forgotten. They all add up to this: Government expenditure cannot remain static in a growing community.

Now, Sir, I turn to the increase in our expenditure, which has been criticized in one or two quarters. I want to examine it, because I do not believe that slogans on these matters are any substitute for actual analysis. Time and the patience of honorable members would not enable me to deal with every item, nor do I wish to anticipate the debate on the Estimates. I will, however, take nine items of increase which between them account for no less than £66,000,000 out of a total overall increase of approximately £70,000,000. The first item is War and Repatriation Services, an increase of £2,000,000. Is that increase wrong? Would a responsible parliament reject it? Would any newspaper or financial editor care to advocate its rejection? Of course not.

The next item is the National Welfare Fund, an increase of £26,300,000. To avoid any increase in this item we would need either to reduce pensions and benefits all round, because the numbers of our people have increased, or deny them to many thousands of persons newly qualified to receive them. That is the plain English of it. People should be prepared to face that fact and come out of their ivory towers, and accept the proposition that under this heading we have £26,300,000 of inescapable added expenditure.

Then we have Business Undertakings, with an increase of £6,300,000. These undertakings include the Post Office, broadcasting, television and railways. They are all expanding, just as other businesses are. Their expenditure, it is true, is up by £6,300,000, but their revenue is up by an amount of £7,250,000. We do not hear about revenue, but we hear about increased expenditure.

Another one of the nine items is Territories. Under this heading the increased expenditure amounts to £1,700,000. Very few people would deny that our rising expenditure on our territories, with the development of native people and all the resources of the territories, is abundantly justified.

The next item of the nine that I have selected is Payments to the States, under which heading we have increased expenditure of £17,000,000. I know that the Opposition will not complain about this, because it thinks that the payment should be a lot more. I am pointing out, however, that of the increase this year £17,000,000 is represented by increased payments to the States. Clearly, we have treated the States with generosity, for we have made increased grants out of falling revenues. That is a point to be emphasized in this regard; tax reimbursement has gone up while tax yield has gone down. But liberality in these matters is, we believe, justified by the need to maintain State works and services, to avoid reduction in employment and to keep expansion going. This is an expenditure by the Commonwealth on a truly national and federal responsibility.

Another item is Bounties and Subsidies, which has increased by £1,000,000. This is entirely due to the new copper bounty, which, as honorable members know, is well justified, for reasons that have been put before the Parliament.

The next item of the nine is Miscellaneous Expenditure, which shows an increase of £1,500,000. The reasons in this case include scholarship and university expenditure, Antarctic exploration, the cost of a forthcoming federal election - which, constitutionally, we must have, and which, therefore, must be paid for - increased trade publicity and dairy research, shipbuilding subsidies, expenditure on immigration and subsidizing of oil research and wool research. I do not think I need say much to justify that item.

The expenditure on Capital Works has increased by £5,000,000. There is criticism, 1 know, in various quarters of the Post Office capital works programme. It is not seriously argued that the Post Office is badly managed, but it is said by some that its capital programme should be financed by increased postal charges. Well, I leave that suggestion to be examined by everybody. The main items of increase under Capital Works this year are -

Adding those three together gives a total of £5,000,000, which represents the increased expenditure on the capital works programme. Nobody who desires Budget policy to forward national development would quarrel for one moment with such expenditure.

Mr Cairns:

– Who is against you?


– Nobody in this place but the honorable member for Yarra makes a mistake if he thinks that 1 am trying to persuade him. 1 do not think that is essential; but there are other people in the country, as he will discover, and many persons in the business community in the outside world, who are shocked by an increase of this magnitude in Commonwealth expenditure in a year in which there are no tax reductions, and 1 believe they are well entitled to have explained to them, in a simple and undramatic way, how all this comes about.

The final item is departmental expenditure, which has gone up by £5,000,000. lt is, of course, relatively small. The whole of the departmental expenditure - the administrative expenditure - in Australia amounts to about 5 per cent, of the total expenditure of the Commonwealth; but to criticize it ignores two things. First of all, wages and salaries paid in the Commonwealth service or employment are fixed by industrial tribunals, and there have been some very heavy upward revisions in the past two years. In the second place, the increases this year are - if I may just select one or two items - most readily intelligible.

The vote for the Treasury is higher because of an increase of £343,000 for the integration of statistical services which are so important to Australia. The provision for the Department of the Interior has been increased by £366,000 because we are improving the meteorological services which are very important. In civil aviation, the total increase of £1,864,000 is largely accounted for by expenditure for the development of aerodromes, subsidies for developmental air services, the improvement of airways facilities and, of course, international obligations. In national development, the invaluable Bureau of Mineral Resources is to have its expenditure increased by £164,000. We do not need to justify the work of the Commonwealth Scientific and Industrial Research Organization. The vote for its work is to be increased by £647,000, and the Atomic Energy Commission will spend an additional £243,000.

To anybody with an eye to the development of our resources, such items do not suggest merely an inflated bureaucracy. Most of them come directly in aid of production, trade and commerce. If you add them up, you will find that they alone come to £3,627,000 of the total increase of £5,000,000; and I have merely taken a few items.

The third feature of the Budget is that migration is being maintained. I know that this is a matter on which there are divided opinions on the Opposition side. Some people - like the distinguished Deputy Leader of the Opposition, the honorable member for Melbourne (Mr. Calwell) - think that the immigration programme, in which the honorable member played such a great part, is of outstanding value to Australia. Others affect to sneer at it, but those who criticize the maintenance of this programme and the fact that it is an element in this Budget, have failed to see that an increasing population, by ensuring an expanding market for primary producers, manufacturers and merchants, maintains confidence in the future and serves to avert the foolish psychology and talk of depression. The maintenance of this growth of population has, I believe, been a great factor in the astonishing development of our country.

The fourth feature to which 1 wish to refer very briefly is this: Central bank policy has been both sound and imaginative. The central bank - the Commonwealth Bank - has maintained the liquidity of the trading banks by substantial releases from special account. It has done much to maintain credit facilities and stability of investment and employment. If anybody in a detached way went back over the events of the last twelve months since there was first some little talk of recession, and traced out what the Commonwealth Bank had done as the central bank, he would. I am sure, share my own view that it has been managed with great skill and great humanity, and that it has served the interests of this country and its people very well.

Under the Commonwealth Constitution, the means available to the Commonwealth Government for managing the general economy are by no means unlimited. I hope that honorable members will always remember that great problems like the fixing of wages and conditions of work and so on, are not within the control of this Parliament. They reside in other authorities. Within certain broad technical limits, even tariff policy is not entirely within our control - although it is technically within our control - because of the existence and the traditions of the Tariff Board. Therefore, a Commonwealth government does not have all the instruments to its hand for controlling economic policy, lt has, for example, virtually no control over interest rates other than interest rates attached to banking. Yet in spite of all that, the remarkable feature of Australia to-day is that, despite the recession in the United States of America, and notwithstanding a very great fall in our export income - a much greater fall in terms of percentage than the one that ushered in the depression of 1929 - employment is at a very high level, housing is proceeding at an increasing tempo, production is rising and living standards are steadily improving.

Sir, that is not only a great compliment to my colleague, the Treasurer, whose last Budget this is; I think it is a compliment also, if 1 may say so, to the general good sense of the Government and of this Parliament which has supported it. This Budget exhibits faith in the future. We have at all times sought to maintain constancy in general policy with flexibility of application to changing circumstances. We hope to continue that approach for the benefit of our people, and the growing future of this nation.


.- On Tuesday night of last week, the Leader of the Opposition (Dr. Evatt) put down a censure motion on the Government on the ground that its Budget proposals are unacceptable to the Australian people. In his programme, the right honorable gentleman demanded practical help for those who need it most. He demanded action to restore the broad basis of the economy. He demanded that a proposal be put forward for a vitalized export drive. He demanded increased subsidies and other concessions to help the farmers. He demanded just and humane treatment for all pensioners. He demanded assistance to the family man by way of income tax relief and improvement in child endowment. He demanded the termination of unemployment and a return to full employment, together with an increase in unemployment benefit while this is happening. He demanded action to assist the smaller companies, together with action to curb the high interest rates charged by hire-purchase companies. He demanded just and practical assistance to the States to aid them in the fields of education, transport, health and local government and greater assistance to overcome the housing lag which is serious, and to stimulate the home-building programme which is completely inadequate in spite of the views expressed to-night by the Prime Minister (Mr. Menzies).

My leader demanded the ready use of the facilities of the Commonwealth Bank together with assistance to small investors in government loans. He emphasized afresh the demand of the Labour party for a review of defence expenditure to eliminate waste.

We have listened to the Prime Minister’s speech with very great interest. I think that the right honorable gentleman enjoyed himself. At least, it can be said that he spent a pleasant evening, arguing with himself, putting up and knocking down his own aunt sallys, but all the time carefully keeping away from the danger spots in an unhappy financial and economic situation. As I heard the right honorable gentleman put forward his unconvincing apology for this wretched Budget I could almost hear him say, “ My defences our down “.

The Prime Minister deliberately avoided the main issue of the eminently fair and just programme which the Leader of the Opposition has advanced. According to his invariable custom, he attempted to divert attention from the real issues to other subjects. As usual, he painted a rosy picture but he left the thorns to the pensioners and to the unemployed.

Mr Menzies:

– I hope you do not let me down. I prophesied five of those headings.


– The right honorable gentleman has let the country down and that is the gravamen of our charge. After nine long dreary years of office he ought to be removed before he can do further harm to the nation. The Prime Minister may say that he dealt with five of the subjects to which I have referred, but he did not promise to do anything more about housing. He did not promise to do anything more in the way of increasing child endowment. He did not promise to do anything more for the pensioners. He did not promise to do anything more for the small investors. He did not promise to do anything more for the farmers, many of whom are now producing for little more than the cost of production. Of course, while this Government lasts nothing at all will be done to restrain the rapacity and greed of those who are living on hire purchase - those who are exploiting the community, those who, in the picturesque language of the honorable member for Parkes (Mr. Haylen), are engaged in blackmarket banking.

The Prime Minister has one eye on the electorate and another eye on the big business concerns in whose interest the Government functions. Consequently, he cannot be expected to say very much about the little people. But there are a lot of little people in this country. Most of the people of Australia are little people. As Abraham Lincoln once said, almighty God must love little people because he made so many of them. There was nothing in the Prime Minister’s speech that promised to improve the lot of the little people - of anybody who needs assistance. There was nothing but the usual hectoring and lecturing appeal to the community to accept the Government’s policy and try to like it. There was no reference in the Prime Minister’s speech to the dishonest promise of nine years ago to put value back into the £1- There was nothing about the promise to reduce taxation, nothing about the promise to abolish credit and trade restrictions, and nothing about the promise to eliminate waste.

I have here a copy of an appeal which the Government advertised in 1946. There, with the inimitable features of the Prime Minister stamped above it is the statement -

We are a tax reduction party.

What we promise we shall perform.

The Liberal Party’s policy includes at least 20% all round reduction in income tax.

Increased family allowances . . . Reduced company tax . . . Reduced sales tax . . Simplified taxation . . . No reduction in social services.

There is nothing in this Budget to give effect to any of those promises.

Mr Menzies:

– We did all that in 1950.


– The Prime Minister, by interjection, says that he carried out all those promises in 1950. I think the community is well able to judge what the Prime Minister has done and what he has not done. He has certainly not done any of the things that he promised to do at that time. He has not carried out any of the promises - extravagant as they were and impossible of fulfillment, as most of them were - which he made with such lavish abandon in 1949. He has dishonoured and disowned them all. His promise to put value back into the £1 will haunt him to the grave. The Australian £1 is not only not worth any more than it was in 1949, it is worth much less.

The Government derided the Chifley £1 claiming that it was worth only 12s. lid. So it was, but it was worth 12s. lid. only because of Australia’s participation in the most terrible war in history. It lost its value of 1939 because of the vast amount of war expenditure. This Government has had nothing but prosperity, as far as the almighty God could shower his benefactions upon us. The rains fell at the right times and in the right places. There were occasions when Ministers seemed to dispute the claim of the Almighty to all the honour that was associated with the events. Only when we got into a bad situation and had one partial drought did the Government begin to feel that perhaps things were not as it had represented them to be.

The Prime Minister has established several records in this Parliament, records that may never be equalled and may never be challenged. But he has one record that nobody will ever want to dispute or claim. He is the greatest breaker of election promises and the arch repudiationist of election contracts of all times. If he will not believe me, let him ask his friends in the “ Sydney Morning Herald “ office. Let him ask his other friends in the press world. Let him ask a lot of tycoons who will have to vote for him but who will hand him in their votes on long shovels. They will have to vote for him because they will not vote for us. They will not vote for us because we are the party of progress and because the policy in which we believe will ensure that the great majority of the Australian people will be treated much fairer and better than they have been treated by this Government.

Honorable members opposite indulge in all the hysterical moronic laughter that one would expect from ignoramuses. I know how the Australian people are feeling to-day. I know the misrepresentation which has gone on over the years, I know the smear campaigns, the distortion of facts and the misrepresentation of truth that have paid dividends to this Government to date. But let us have a little trouble with the weather and then we shall see how the Government will fare. This country has been nauseated over the years by the boastfulness of Ministers about prosperity. In one of his ecstactic moods, the Prime Minister talked about Australia enjoying unparalleled prosperity. There is no prosperity for the pensioners; there is no prosperity for the unemployed; and there is no prosperity for the sick and the suffering and none for workers and their families. The Minister for Labour and National Service (Mr. Harold Holt) went one better. In an even more ecstatic mood he said that the country was enjoying permanent prosperity, but there is nothing permanent about the prosperity that he so glibly talked about. We have discovered that our alleged prosperity is a rather illusory thing; and the Prime Minister has been hard-pressed for some considerable time past to explain the inexplicable, to justify the unjustifiable, and to defend the indefensible. If the Prime Minister wants to know the position of the economy, let him look back at the speech of his outgoing Treasurer. A few days ago in his Budget speech the Treasurer said -

In the United States of America . . . there seems little prospect of substantial recovery before the end of 1958. In the United Kingdom . . . such expansion as may take place … is not expected to be large. In Western Europe . . . the most to be expected for the time being is that the present position will be held . . . few authorities foresee any strong upturn during the coming months in world prices of raw materials . . .

That is the situation we must face. The world, under capitalism, is in a horrible mess. In the United States, that home of rugged individualism and of free enterprise, 5,000,000 people out of 60,000,000 are unemployed. In Detroit, the home of the Chrysler, General Motors, and Ford automobile empires, 400,000 people of a total work force of 1,100,000 are jobless. Over 30 per cent, of the total work force. Just imagine how the Australian people would react if 30 per cent, of the people who work for General Motors-Holden’s Limited, for the Ford Motor Company and for other big American and British enterprises in Australia were out of work.

Mr Menzies:

– It would be like going back to the days of the Lang Government in New South Wales.


– The Lang Government of 1931 was a creation of the depression years. Any Labour government in the dreadful period from 1929 onwards had to clean up the mess that was created by the Bruce-Page Government. When 1 see honorable gentlemen opposite apparently running dead in this campaign, I think that they would like to see a Labour government in office in order to clean up the mess that they in their turn have created. The bitter past is no longer with us, but its bitter memories remain. The Labour party will do all in its power to prevent the creation of any more man-made depressions like those of the 1890’s or the 1930’s.


– The Labour party reduced pensions.


– Honorable members opposite also voted to reduce those pensions, and when the Lyons Government came to power after the defeat of the Scullin Government, it reduced pensions by an additional 2s. 6d., so honorable members opposite had better stop talking about that particular matter.

The Prime Minister and the former Leader of the Australian Country party made promises to the people in 1949 that taxes would be reduced. The right honorable member for McPherson went on record on 17th November, 1949, as saying -

Rates of taxation, both direct and indirect, can and will be steadily reduced.

On 12th November, a few days previously, at Wagga Wagga, in New South Wales, the Treasurer said -

If we are returned at the forthcoming elections, we are going to borrow £250,000,000, to give it - not lend it - to the local authorities for wise expenditure on roads, aerodromes, bush-nursing, and local government activities.

This Government has not given Id. of a loan free to any State government or to any municipality to build roads or bridges or to do anything in respect of State activities or local government activities. Of course, getting bolder as he went, and sensing victory, the Treasurer, at Young, New South Wales, five days later, said -

We will seek to free the demands of trade by eliminating restrictions and obtaining all the goods and materials possible, having in mind the economic circumstances of Australia and the world.

Yet this Government has imposed far graver restrictions and more extensive controls and restrictions than any imposed in Australia since the end of the war. The economy is only being maintained in a state of solvency to-day because of clamping down, because of the harshest restrictions on imports and credit, both of which the people need in order to carry on or expand their activities. Hundreds of thousands of people in Australia would be only too pleased to see restrictions removed, to see credit eased. But they cannot get what they want because this Government, due to the precarious state of our finances, is not able to lift the lid on any of the controls that it has imposed.

The best that the Minister for Labour and National Service could do in his speech was to say, in respect of. the unemployment problem, that the recession is receding. He instanced, as a spectacular happening, the fact that the number of unemployed is 1,000 fewer than it was a month ago. He argues that that leaves only 66,000 workers jobless. At such a rate of recovery Australia can expect to see full employment restored in another five and a half years. It will be five and a half years before we get back to full employment - if this Government lasts so long. We want full employment now. The Australian people want full employment now. They believe that what is physically possible is financially possible, and they do not trust this Government on the issue of employment. The people of Australia fear that a depression is coming, and I think they are right. We have seen what is happening in America, where 8 per cent, are unemployed. We see what is happening in Canada, with 10 per cent, unemployed. We know that Great Britain is facing a desperate situation. Two hundred and fifty cotton and textile mills have closed in the last three years. So hungry and so greedy are the vested interests of Great Britain that although they have the best shipyards in the world, they are having their ships built in Germany and Japan rather than in England and so the number of unemployed in England is growing. The Labour party is determined to stick the depression label fairly on this Government and its supporters. Tory politicians and their outside financial backers are the only people who can or ever do create depressions, recessions, or whatever else people like to call avoidable unemployment.

The Deputy Leader of the Liberal party has made several attempts in recent times to ease the feeling of concern which the Australian people rightly have about to-morrow. The Government admits in the Budget that farm prices are falling, that things are getting worse, and it even says that next year there can be no certainty that things will be better. In the employment situation the problem will be solved, or will get better or will worsen. If the Government allows the present condition of affairs to continue, we will be headed for a depression, because when unemployment starts, its effects are cumulative. They snowball.

I was astonished - and so were many other honorable members - to hear the Minister for External Affairs (Mr. Casey) say in that reckless, ranting rhetoric for which he is notorious, that the Chifley Government took every opportunity to spit in the face of Great Britain and in the face of the United States of America. The charge is false, Mr. Chairman, lt is wickedly false. And it is nonetheless false because it comes from a member of Her Majesty’s Most Honorable Privy Council, who long ago was invested as a Companion of Honour. The story of Labour’s attitude to Great Britain has been told several times, of course, and it was told again the other evening by the honorable member for Eden-Monaro (Mr. Allan Fraser). The Chifley Government gave £45,000,000 to the people of Great Britain to help them when the war was over, but this Government has never given the same people a single penny. The Chifley Government encompassed its own defeat in part by insisting, not that Australia’s dollar reserves should be used for the easing of petrol rationing in Australia, but that they should be made available to feed the people of Great Britain. The charge that the Chifley Government spat in the face of Great Britain, and in the face of the United Stales, comes from a man who himself spat in the face of Australia in 1942, in the darkest period of the war, when he walked out of his job as Australian Minister in Washington. The Minister for External Affairs had little else to say. He never has so very much to say, anyhow. I know that he said a number of things in 1949, and I may even regale the committee with a recitation of them later.

Then there was another one who spoke the other evening. We heard for the first time in this chamber the honorable member for Parramatta (Sir Garfield Barwick). He is missing this evening. He was missing from the Parliament for most of the last sessional period. He came among us as a champion of reaction; as the white hope of monopoly capitalism. He described himself as a fledgling - a fledgling with a spare feather to wave at what he, as a fledgling, mistook for a departing eagle. Being a fledgling, he could not distinguish between an eagle and a sparrow. By the way, Sir, if he does not attend in this Parliament more regularly, he will earn the unwelcome sobriquet which was bestowed upon another legal luminary who came here every now and then. That honorable gentleman, who is no longer with us, was known as the Butcher Bird. And to put the record right I should like to impress the fact that the only financial eagles that this Parliament has ever known were Theodore and Chifley, and they both were Labour Treasurers.

The eminent lawyer from Parramatta did not attack the Budget, because he is hoping for ministerial rank if the Government should win the next elections. He did not attack the Budget, but he did the next best thing: He damned it with faint praise. He expressed the pious hope piously that inflation would not be allowed to recur. The fallacy behind all that is that the battle of inflation has been won. Inflation, of course, is still progressing and it will never be conquered while this Government remains in office.

I said a moment ago that I should like to tell the committee what the Minister for External Affairs had said in 1949. In a broadcast made on 11th December, 1949, he said that the Menzies Government would ensure that Australia became a land in which no one was left out. He proclaimed -

The Australian wage-earner will be in the fore front of our hearts and minds from the day we take office.

The Australian wage-earners have been so much in the minds and the hearts of this Government that the Australian worker to-day pays more in taxes than he ever paid before. He pays more, in both direct and indirect taxes, than he ever paid before, and the basic wage, of course, in real terms, is not as high to-day as it was in the days of the Labour government.

Mr Stokes:

– The workers have never been better off.


– The honorable member for Maribyrnong disputes what I say about the taxes that the worker pays.

Mr Stokes:

– The worker has never been better off in his life.


– The honorable gentleman, not being a worker, does not know. The worker on the basic wage, Mr. Chairman, who was without dependants paid tax of £16 out of his basic wage in our day. To-day, the basic wage worker who is without dependants pays £50 13s. A married man with a dependent wife paid £7 15s. out of his basic wage in our day, and to-day he pays £31 9s.

Mr Stokes:

– And he is able to do it!


– First of all, they deny that the worker is paying more, and now they offer some other excuse which, of course, is unintelligible. To-day, a man with a wife and three children pays £9 2s. in taxation out of his basic wage, whereas in our day he paid nothing. So Government supporters cannot make the story stick that this Government has done wonderfully well by the Australian people. I commend the Budget statement itself to those honorable members who dispute the contention that the worker pays more in direct and indirect taxes now than when Labour was in government. They will find that indirect taxation per head of the population has increased by 100 per cent, and direct taxation has increased by 90 per cent. So how can this Government keep on trying to delude the people with stories that the worker is more prosperous than ever before?

Mr Buchanan:

– The worker gets a higher wage out of which to pay that taxation.


– Yes, but his money is almost worthless. The Menzies £1 is worth only 5s. in real terms whereas the Chifley £1 was worth 12s. lid. The mere possession of paper money does not mean that the money has value with which to purchase goods. After nine years of mismanagement of the country’s finances, this Government has been reduced to the final extremity of resorting to the printing press. It proposes to print £110,000,000 worth of notes with which to finance the nation’s activities this financial year. But when Theodore wanted a fiduciary issue of £18,000,000 in 1931, in order to keep the farmers on the land and the workers from starvation, the tories of that day - some of them were the fathers of the tories of today, and if they were not direct ancestors, they were the blood brothers of the tories of to-day - rejected the Labour measure in the Senate - and every tory in this Parliament voted against it.

The Prime Minister has told us that, when the year is out, we shall be using more treasury-bills than ever before. So we shall. The figures that he quoted - or misquoted - with respect to the war situation should be mentioned. He said something about a deficit of £110,000,000 in a particular war year. As a matter of fact, in December, 1945, the Chifley Government had a note issue standing at the huge total of £386,000,000, but that figure was brought down to £108,000,000 in June, 1949. In June last, the issue was about £140,000,000, and if the normal issue for June remains at that level, by 30th June of next year there will be that amount plus another £110,000,000. The figure will be a peace-time high of £250,000,000. In December of last year, the treasury-bill issue was as high as £250,000,000. If the normal issue is at the same level next December, and we add the Budget figure of £110,000,000, we shall have a total of £360,000,000 worth of treasury-bills floating about this country. And the war-time record was only £385,000,000! Yet this Government says that this is the proper way to handle the nation’s finances. If I can be accepted as a prophet at all, I would suggest that, should this Government, unfortunately, win the next elections - and it can win them only on the preference votes of the Australian Democratic Labour party - it will not provide for a fiduciary note issue of £110,000,000 in the next Budget. It will do what it did in March, 1956. It will clamp down on the people with more taxation.

In 1954, this Government reduced taxation by £47,000,000. In 1955-56 it said that the country was prosperous, that we had to hold our prosperity, and that there could be no further tax reductions. The situation confronting the Government in framing its Budget of 1955 was that there had been a split in the Australian Labour party and so the Government thought it could win the elections without providing any taxation relief at all. But a few months later, on 14th March, 1956, in this chamber, the Prime Minister brought down proposals that increased taxes by £115,000,000 - and it can happen again. He said nothing about increased taxation during the elections.

Later that year, the Government remitted £57,000,000 in taxation. There was nothing given away in the Budget of last year, 1957-58, but the Prime Minister boasted that because of the tax reductions in the 1956 Budget the country would benefit much more than could have been imagined a couple of years ago, or something like that. What he did not say was that of the £115,000,000 taken under the little horror Budget, only £57,000,000 had been given back. The Government retained the remaining £58,000,000.

If the Government wins the next elections it will again impose additional taxation to the extent of £110,000,000- the equivalent of the deficit this year - and will say that it had the authority of the people to do it. I warn the country that the same trick that the Prime Minister played a few years ago was played by the Premier of Victoria in the recent State elections. He said nothing about increased electricity and gas charges; he said nothing about increased tram fares and train fares. He was presented with his mandate because the preference votes of the D.L.P. gave him sixteen seats. So, in the final analysis the so-called “ democratic “, so-called “ Labour “, socalled “ party “, is responsible for the fact that the Bolte Liberal Government has imposed further exactions which hit the supporters of the D.L.P. as much as they hit anybody else. If the supporters of the D.L.P. give their preference votes to the Menzies Government in the next elections, they will encompass their own defeat. They will add to their own miseries and they will increase their own burdens.

I have sketched the story of the financial position of Australia, as we see it. We have never used the printing press as a first or last resort. We had to expand the note issue during the war, because we taxed the people of Australia to the point at which it really hurt. We imposed taxation of up to 18s. 6d. in the £1 on all taxable incomes of £5,000 and over. We could not have gone much further. Everybody paid all sorts of taxes. But the difference between loan raisings plus revenue raisings and the cost of the war had to be bridged if the nation was to survive, so we had a justification for doing what we did. But there has been no war to justify what this Government is doing, or what it proposes to do.

If we cannot reject the Budget here, we ask the people of Australia to reject the Government responsible for it. This is a tax-happy, printing-press Government. This is a Government that does not concern itself with the great mass of the people. It wants power, it loves power, and it has abused power. Because it has abused its power, it ought to be rejected.

The speeches of honorable members opposite have, in very few instances, been addressed to any of the .problems of the Budget. Some honorable members opposite want sales tax removed from municipalities. Some have pulled the parish pump on other issues, but very few of them have faced up to the fact that this Budget is a bad Budget. It is a mean-spirited Budget, it is a wretched Budget, and it is a Budget which is not wanted. Most of the sentiments of Government members have been expressed in cliches, platitudes, banalities, irrelevancies and sophistries, and everything else which can be expressed in the spurious coinage of a decrepit, discredited government. It is all expressed in the jargon of political mountebanks and political has-beens.

Those people in receipt of big incomes in this country, who are always so greedy around Budget time, wanting remissions of taxation for themselves, have little to complain about in the matter of taxation, as compared with taxpayers in the United States of America and Great Britain. Top bracket income earners in this country are doing very well and they know it. They realize that at the upper levels of society the air is always sweeter, and the view more inspiring than it is for the rest of the community, and particularly for age, invalid, and widow pensioners, and for those persons living on or near the basic wage.

Those people are our first concern and should be the first concern of everybody in Australian politics.

We are living in a dangerous situation. As President Theodore Roosevelt once said of the United States -

We enjoy exceptional advantages and are menaced by exceptional dangers, and all signs indicate that we shall either fail greatly or succeed greatly.

If the Australian people renew their trust in the Menzies Government, Australia will fail greatly. Australians will succeed greatly, only by returning a Labour government.

The mess in which this Government finds itself in regard to loan raising, in regard to loan conversions, in regard to cash balances, in regard to deficits, in regard to inflation, and in regard to everything else, is all of its own making. Nobody else has created its problems. They cannot be blamed onto Labour troubles, because the Government continually boasts of the amount of peace there has been in industry in the nine years it has been in office. The Government cannot blame the farmers for not producing. The farmers are producing as best they can, and are trying to sell wherever they can, but they are not getting the assistance that this Government ought to give them. The dairy farmers are a case in point. Something has to be done for all sections of the community, even for those people who foolishly believed the story about what can be done under the magnetism and mesmerism of free enterprise. Even those people who deserted us now know that they have to return to us in their own best interests.

It may be interesting to remind honorable members that the problems of to-day are so serious that we could find emerging the equivalent of the Young Nationalists organization, which the Prime Minister and the honorable member for Chisholm (Sir Wilfrid Kent Hughes) helped to found and which had with it in other days the Chief Justice of Victoria, Chief Judge Spicer of the Arbitration Court, and other notable people. This body met in 1940 to discuss war finance, and at the end of the meeting passed resolutions which contained a number of suggestions. The most interesting of them being the last one, which read -

To facilitate post-war reconstruction, a suitable part of the loan money raised during the war should be redeemed by a capital levy at the conclusion of hostilities.

This suggestion came from present supporters of the Liberal party. As Australia is facing a heavy programme of loan conversions in the coming year, I should not be at all surprised if some Liberal people put forward again the proposal - with which they credit us, quite falsely of course - for redressing the financial grievances of the nation by a capital levy.

There is one Australian Country party member of this Parliament who has not yet been spoiled by his association with the other people in hill-billy corner. He is the honorable member for Richmond (Mr. Anthony), who said to-day that this Government is either completely ignorant of the facts, or will just not listen to them, when it comes to the matter of dairyfarmers. Regarding the Government and its attitude to private enterprise in farming, he said -

Surprisingly, I belong to a Government which is supposed to believe in private enterprise and is opposed to socialism, yet it allows the great growth in public servants at the expense of primary industries.

That is the talk of one member of the Australian Country party and it is an example of the despair he feels at existing conditions. He knows that the people he represents cannot possibly prosper under this Government, and so he is looking for .a way out. Members of the Australia Country party will soon have to make up their minds on whether they will join the Liberals and be open and honest tories, or whether the more radical of them will make their peace with the Australian Labour party. The present position cannot continue for them. The number of persons working permanently on rural holdings has fallen from 444,000 in 1940, to 398,000 to-day. There are 4,000 fewer people working on farms than there were when the Chifley Government was defeated. Yet the Australian Country party representatives here seem to be perfectly happy about the drift from the farm to the factory. In 1949, farm incomes amounted to £321,000,000. In 1956-57, the figures were £535,000,000, but they dropped to £359,000,000 in 1957-58. The farmer to-day is getting just about as much money from the proceeds of his labour as he was getting in 1949, despite the vast increase in the cost of living and all the rest of it. And the worst is not yet, because the Treasurer said in the Budget speech that farm incomes are expected to fall further this year. In actual money terms farmers were much better off when the Labour government was in office than they are under this composite Government.

What the honorable member for Richmond said in this debate reminds me of what the Minister for the Interior (Mr. Fairhall) said when he was muscling his way into the Government back in 1951. He will not say anything about this Budget similar to what he said in 1951, but the position is now worse than it was seven years ago. The Minister for the Interior said that he always believed higher taxation inhibited production. He believed that with the proposed rate of taxation in that Budget the Government found itself a half-shareholder in every successful enterprise in Australia. The most significant thing he said was that the Government was beginning to collect its taxes ahead, like a bankrupt living from hand to mouth. But the position is becoming so desperate now that the Government cannot live from hand to mouth; it has to have recourse to the products of the printing press to try and survive.

The position in regard to farming and its problems is world-wide. Three million people have left their farms in the United States since 1940, and there is a growing problem there, which shows that under capitalism the problems of the farmers cannot be solved.

Mr Turnbull:

– What do you suggest?


– I suggest that the people get rid of every Australian Country party member in this Parliament, and I suggest also that they should not wait too long before doing so.

Finally, Mr. Chairman, the case put forward by the Leader of the Opposition has not been answered by any speaker on the Government side. The charges remain. They can be voted down in this Parliament, but they will not be laughed off by the Australian people. The issues which we have raised in this Budget debate will be the issues on which we will fight the coming general election. The issue in the election will not be the spurious issue pf communism. The parties now in office can pull that old bogey out from under the bed as they have done on the last six or seven occasions. They can tell all the lies they like and introduce all the propaganda they like; but they cannot fool all the people, or even a majority of them, all the time. We hope that the people of Australia will realize that the Australian Labour party is the only party that has ever done anything great for them. We bring to the Australian people a message of faith and hope. We bring them faith in the future greatness of our land and hope for the success of all its people, whoever they are and wherever they may live in this great continent. Our party, I repeat, is the only party in Australian politics that has ever done anything worth while for Australia. It is the only party that ever will do anything really great for the continued progress and development of Australia, and for the social and economic well-being and contentment of its people, now and in the future.

Minister for Social Services · Riverina · CP

– Every member of the chamber - with one or two notable exceptions - has seized the opportunity provided by the presentation of this Budget to pay tribute, to use an appropriate term, not to Caesar, but to the Treasurer (Sir Arthur Fadden), who has rendered great public service to the people of our country as a private citizen, as a clerk in local government, as a professional man, as a member of the Legislative Assembly of Queensland, as a member of this House, as a Leader of the Australian Country party, as a Prime Minister and Deputy Prime Minister, and as Treasurer of the Commonwealth.

It is a formidable record of service including, as it does, the greatest number of Budgets ever presented in this House by the same man, and each one of them has been a monument to his courage and devotion to a task that invariably excites criticisms, since there is no such thing as a Budget that is wholly acceptable to the entire community.

Those of us who have been associated with the right honorable gentleman have cause to be grateful to him for the rich quality of his friendship, for his great humanity and humour, and for the assistance he has given to us all from time to time - friend and foe alike. I offer him my homage on his great achievement and my good wishes for his future happiness and contentment.

This Budget is the Treasurer’s crowning achievement. A lesser man would have been tempted to celebrate the presentation of his final Budget with a reduction in taxation, a contraction of expenditure, and a surplus vaingloriously designed to bring him personal satisfaction. But the right honorable gentleman, with a fine sense of duty, has seen fit to defend the expanding economy of our country by holding taxation at its present and tolerable level, by increasing expenditure to meet the needs of a rapidly increasing population, by offering inducements for development, by releasing credit from the special accounts of the trading banks held by the central bank, by making payments to the States on an increasing scale, by preparing for the redemption and conversion of maturing war loans, and by the utilization of the credit facilities of the central bank to meet a cash deficit of some £110,000,000.

That is the Budget of a man who has infinite faith in the future of our country, and his faith is shared by every member of the Government and, I have no doubt, by responsible members of Her Majesty’s Opposition. Unhappily, it is not shared by the Leader of the Opposition (Dr. Evatt), who, strangely enough, has to be congratulated on his Budget speech, but for entirely different reasons. I have known the Leader of the Opposition for nearly 40 years, which is a long time, but I have never known him to be quite so well prepared for any public performance during the whole of that time. His material was neatly marshalled in a manilla folder for the first time. There were no untidy scraps of paper to fall from his feverish hand. He did not lose his place during the whole of his recital, which lasted for some 45 minutes, nor was he prompted by either the honorable member for East Sydney (Mr. Ward) or the honorable member for Hindmarsh (Mr. Clyde Cameron), which is most exceptional. And let it be said, the right honorable gentleman was quite coherent - he was against the Budget.

There is a section of Her Majesty’s Opposition led by the right honorable gentleman, comprised of honorable members who, for the last nine years have been howling depression - we heard it to-night from the honorable member for Melbourne - howling unemployment, social misery, wretchedness and woe, but each year, Budget by Budget they have had to face increasing revenues provided by the people of our country, increasing expenditure, increasing payments to the States - multiplications of millions of pounds - increasing loan allocations to the States - again multiplication of millions of pounds - increasing social service benefits year after year and Budget after Budget and this year and this Budget are no exception. Indeed, this year revenue will exceed £1,465,000,000 and expenditure will reach £1,575,000,000 for the first time in our history.

Of course, members of the Opposition are against this Budget. Of course, the Leader of the Opposition is diametrically against the Budget. He and his colleagues have been against every Budget since 1949. They must be against this Budget since it denies to them the foetid, political atmosphere necessary to cause the people of a democratic country to lose their political reasoning.

I must join issue with the Leader of the Opposition when he said, in precise terms, referring to honorable members on this side of the chamber -

They began with a rich inheritance from the Labour Government of Mr. Chifley.

Opposition Members. - Hear, hear!


– Let me quote that again since, for once I get “ Hear, hears! “ from the Opposition. Their leader said -

They began-

That is referring to this Government - with a rich inheritance from the Labour Government of Mr. Chifley.

Time marches on. Nearly a decade has passed since this country was brought close to utter disaster by the socialist government of the period, and so the day has come to deny it. Another generation has grown up, and the time has come to deny it. Ten years ago the public memory was notoriously short, and the time has come for the Leader of the Opposition to deny it.

Have we forgotten the social and political disaffection which brought this country to its knees and took the late John Curtin and the late J. B. Chifley both to an early grave? Have we forgotten the industrial anarchy which drove us out into the markets of the world to beg for the basic materials we needed to keep us from abject ruin? We had no coal - we who have some of the richest coal seams in the world - and we crawled all over the world, even into the countries of our enemies, begging for coal to keep our industries going. We went begging for pieces of coal, tons of coal, cargoes of coal at any price because the Prime Minister of that period, the late J. B. Chifley, said, “ Never again will the miners of this country hew enough coal to meet the normal needs of the people.”

We had no steel in those days - we who have the best and cheapest steel in the world - and we went begging for steel, any kind of steel, anywhere, at any price. And when the Japanese in the years from 1946 to 1949 told us that they were not good at providing steel and that they were not good at galvanizing iron we told them that it did not matter, any kind of steel would do and any kind of galvanized iron would do.

We had no timber - in this country, the coastal belt of which is rich in timber; where every country town and village has a variety of saw-mills. We had no timber after the socialist government had been in office and we went out into the world begging for bits of timber wherever they were to be found.

We had no cement, one of the basic materials vital to us all from day to day. We went out into war-ravaged Europe and Asia and begged for cement wherever it was to be had, at any price. This was our inheritance which the Leader of the Opposition describes as a rich inheritance.

I remember when the first contract for the great Snowy Mountains Hydro-electric Authority was let to a Norwegian firm. We had to explain to that successful tenderer that we could provide them with nothing except food; I will come to that later. We told them that they would have to bring their own men, machinery, equipment and labour from Norway. They would have to bring their own timber and their own nails with which to build their buildings before they could start on this great project. True enough, at that time we had enough to eat, but that was entirely due to the fact that the primary producers of our country were still playing the game of life according to the democratic rules, although they would have been deprived of their equity in their own production but for litigation and the threat of litigation.

There was not a man, woman or child in the community who was not subjected to the indignity and usury of the black market. Yet the right honorable gentleman describes that dreadful period as “ a rich inheritance “. When we cried for petrol at that time we were given a coupon and we were offered ten on the black market at a price. We were told that never again would this country be able to get the oil fuels that were necessary. But within five minutes of the defeat of the socialist government that problem, together with all the other problems, was in the process of being solved and was indeed, and in fact, completely solved. These were the excesses and abuses that drove the Labour governments of Mr. Chifley - as the right honorable gentleman so naively puts it - to the final madness of bank nationalization. That was our inheritance in 1949 - a great country brought close to the brink of disaster by the utter senselessness of socialists. That was our inheritance and the Leader of the Opposition takes pride in it.

But enough of that. It is just as unpalatable to me as it is to honorable members opposite. There is, perhaps, a case for the reduction of expenditure, but I cannot plead it with any degree of confidence, since the department I administer has been responsible year by year and Budget by Budget during the last nine years for the most spectacular increases in social service expenditure ever known in any part of the world. I am not referring to this country; I am referring to the whole world. The comparative figures are well and favorably known to most honorable members, but I am afraid that they must be repeated for the benefit of those who cannot rightly be described as honorable members.

I remind the committee once again that the total expenditure from the National Welfare Fund on health and social services in 1949 - the most generous year of the socialist government - was confined within the limits of £80,777,000 or 14 per cent, of the total expenditure from the Consolidated Revenue Fund. However, this year the total expenditure on social services will be in excess of £273,817,000 or 20.9 per cent, of the total expenditure from the Consolidated Revenue Fund.

In addition, we find that the total expenditure on repatriation in 1949 was £27,362,000 or 5 per cent, of the total expenditure. Repatriation is a charge on the community, but, by the inexorable processes of time, it reduces itself normally from year to year. Repatriation benefits have increased until to-day they exceed £73,092,000 or 5.6 per cent, of total expenditure. If we add the expenditures on health, social services and repatriation, we find that the total expenditure, in round figures, in 1949 was £108,000,000 or 19.5 per cent, and for this year it is £346,909,000 or 26.5 per cent, of the expenditure from the Consolidated Revenue Fund. That means, in effect, that the first 5s. 2d. of every £1 paid in taxes of any kind is used to provide social service and repatriation benefits for our people. There are fewer than 4,000,000 taxpayers in this country, yet year by year they have had to face up to this spectacular increase in social service expenditure, until to-day such expenditure has reached these unprecedented levels.

Social service expenditure, of course, is not exclusive to this Commonwealth Parliament - and this is a point of the very greatest importance to every intelligent person in the community. It is frequently forgotten, and sometimes maliciously forgotten, that all six States of the Commonwealth carry heavy social service expenditures and responsibilities. The following table shows the expenditure by each of the States for the years 1948-49 and 1956-57: -

The total State expenditure rose progressively from £55,784,000 in 1948-49 to £182,199,000 in 1956-57.

When my distinguished friend and colleague, the Minister for External Affairs (Mr. Casey), spoke proudly of the social service record of this country, the gloomy and honorable member for Eden-Monaro, who is sitting at the table, replied -

The Minister need only look at the documents that are brought to his office daily, which set out the order in which countries stand in these matters.


– In the provision of social services.


– The honorable member was referring, as he reminds me, to the provision of social services. He continued -

He will see not only that Australia is not al the top, but also that it is not even fourth, fifth, sixth or seventh - it is we’ll down the list. That state of affairs has come about during the last eight or nine years, while this Government has been in office. What I am saying is based on official figures, and the Minister cannot deny it.

This Minister can deny it and this Minister will deny it. The honorable member for Eden-Monaro ignores the fact that we are a federation. It is possible, of course, that his ignorance is due to forgetfulness. It is possible that it is even worse than that. The true position of Australia in the field of social services can be found only after Commonwealth expenditure is added to that of the States. Nor is there any great merit in the point, since a multiplication of unemployment in a densely populated country could lift, and does lift, social service expenditure in that country to a level of shame, instead of pride. The same applies to all other social services. If any attempt is made in a densely populated country to meet the situation adequately, then social service expenditure must, of necessity, rise. Where unemployment and social misery are kept to the minimum for any reason, then the expenditure on social services must naturally reflect that most fortunate circumstance.

During the last eight years, this country has enjoyed exceptional prosperity due, very largely, to prolific seasons, profitable prices, great industrial activity and buoyant revenues of every kind. Year by year and Budget by Budget, despite variations in the rates and incidence of taxation, both revenue and expenditure have increased progressively to unprecedented and, indeed, unimagined levels.

For the first time in the present century we found ourselves in the position where we could embark on an immigration programme of fabulous dimensions, adding more than a million and a quarter people to our population. We found ourselves in the position where we could make vast sums of money available for public works of every kind, both State and Federal. We found ourselves in the position where we could engage in developmental enterprises of great magnitude in every State of the Commonwealth, and in our territories. We found that we could maintain our primary industries, expand our secondary industries and extend our tertiary industries without undue economic stress or strain, and we found ourselves in the position where we could share our prosperity, not only with our own people, by way of social services, but also with the less fortunate people of South-East Asia, on an increasing scale. In addition, and for the first time, we have been able to devote prodigious sums of money to scientific investigations of a most spectacular and most profitable kind.

These were our circumstances when the previous Budget was brought down but, due to the inevitable vagaries of our seasons, when the physical volume of our primary production was cut down by drought and we suffered a substantial fall in export commodity prices, we now find ourselves with less buoyant revenues, and increased commitments, in terms of expenditure, which are both morally and politically inescapable. The situation could have been met by a surrender to despair, by a catastrophic reduction in expenditure and the precipitation of a crisis, if the Government had listened to the demands for tax cuts and even tax eliminations, that would have brought to an end the most spectacular period of progress we have ever known. That is how local depressions are created, by an ignominious surrender to temporary circumstances, and the Government rejected these demands.

At the moment, and so long as there is no world crisis, we are the masters of our own economic fate. We could repudiate our own prosperity, we could reduce taxation, abandon defence and excite the contempt of our friends, reduce expenditure, reduce employment, reduce development and reduce payments to the States for their essential services. The amazing thing is that there are those who demand action of the kind regardless of the social and economic consequences and, I am afraid, there are those who had hoped that these demands would be met. They are not to be met.

The Budget has made provision for contingencies of every kind and, as a consequence, the gap in revenue and expenditure is to be bridged by deficit finance to the extent of £110 million borrowed from the central reserve bank. That is the inevitable position when estimated revenue falls below estimated expenditure but, so long as we apply ourselves to the task of production in ali its forms, it is a deficit of manageable proportions.

This Budget is a re-affirmation of faith in the social and economic future of this young and under-developed country, equipped with the fiscal and physical means to solve its own political problems in its own way.


.- It is becoming increasingly apparent, Mr. Chairman, that the Minister, who has just resumed his seat, was not selected as the Minister for Social Services because of his Scotch accent, but rather because of his heart of granite. Honorable members will recall that he is the Minister who, a short time ago, refused to receive the pensioners of Australia who came to this place with their humble plea for some increase in their miserable weekly pittance. This is the same Minister, Mr. Chairman, who refused to see the mothers and housewives of Australia, who came to this house on the day of the presentation of the Budget, in the hope that they might be able to induce this Minister to increase the maternity allowance, an allowance that has never been increased since its inception, despite the fact that since that time the basic wage has increased by about 128 per cent. This is the Minister who refused the plea of the mothers who sought some relief with regard to child endowment, and I direct the attention of honorable members to the fact that he is now leaving the chamber. During a Budget debate the Minister for Social Services can properly be expected to deal with matters pertaining to his department, but this Minister is obviously ashamed to be associated with the miserable social service provisions which he administers on behalf of the Liberal-Country party coalition government, and so he hangs his head in shame and leaves the chamber as soon as this matter is raised.

Mr Cramer:

– He will deal with these matters in the Estimates debate.


– Order! I ask the Minister to remain silent.


– It is becoming increasingly apparent that the LiberalCountry party coalition is about to throw in the towel just as it did in the dark and desperate days of 1941. The people of Australia will recall that it was, a govern.ment of the same political complexion as the present government that deserted this country at its time of crisis, when Labour was called upon to fill the breach. Does the Minister who has just left the chamber criticize this country’s war effort under a Labour government? Does he discount the sacrifice and the self-denial of the Australian worker and the Australian housewife who waged a total war effort? We are tremendously proud of the efforts of the Australian people, and, indeed, of the Labour Government of that time. If the Minister criticizes the record of the people, he might possibly go on to criticize the servicemen who accounted for themselves in such an impressive fashion.

Never before have we seen the Prime Minister (Mr. Menzies) fight such a losing battle as he did to-night, grappling with his own conscience, desperately endeavouring to convince himself and his colleagues of the solvency and buoyancy of the Australian economy. The Prime Minister, notably enough, has failed to make any reference to social service provisions in the Budget. lt is worthy of mention that the pensioners listened to the final Budget speech of the Treasurer (Sir Arthur Fadden) in the hope that he might be encouraged to make some final gesture to them and to the underprivileged people of this community who have suffered to such a great extent during his regime. Some miserable concessions were announced, concessions which for this year amount to something like £3,900,000. The pensioners listened hopefully, and it may be that some of them who are becoming very elderly might have been a little bit confused, and perhaps have said, when hearing that a supplementary rent allowance of 10s. a week was to be granted, “My word, that is a generous concession for a government to make “. But when we look further into the matter, we find that the rent allowance is applicable to an infinitesimal proportion of the pensioner community. Just a short time after the Budget was presented, I explained its provisions to 200 pensioners in my electorate. Having explained it fully in every detail, I said “ Let us see the pensioners who will benefit by these rent concessions “. Two pensioners out of 200 assembled raised their hands. In other words, this miserable concession, which has been included in the Budget to convey an idea to the people of Australia that there is some genuine concession in it, provides a benefit to something like 1 per cent, of the pensioners in my electorate.

There are very few pensioners who can benefit, because the Treasurer has said that they will receive their supplementary pension provided they do not receive any other income and provided they pay rent. They must be single or, if they are married, they must have an income limited to £4 7s. 6d. a week. That is the essence of this miserable concession.

The other fiddling thing was something about raising the maximum limit. It simply means that the pensioner who receives a small proportion - the smallest possible proportion of pension - will receive just a little bit more. Even the repatriation concessions in total amount to only £1,002,000 so it can be expected that the Minister for Social Services can deliver a long prepared speech without any reference to the matters that he is responsible for administering. The Minister said the Budget was the Treasurer’s crowning glory but apparently it was not so in relation to social service concessions.

This Budget is documentary evidence of the fact that the Government is bankrupt of ideas and completely incapable of coping with the enormous ramifications of the economic crisis. This Budget has been received with alarm by the Opposition, with worried concern by the farmer and businessman, with general disappointment by the family man, with horror by the pensioners and with miserable despair by the Government supporters, especially those in borderline seats. The Treasurer said in his Budget Speech - this country is not lagging and depressed; it is, on the contrary, highly prosperous, and it is moving ahead.

Yet we have been treated in these so-called prosperous times to a Budget devoid of any substantial concessions. In this allegedly prosperous era we see, for the first time in many years, a Budget deficiency of £110,000,000 which the Government proposes to finance by creating treasury-bills, a practice which it has deemed hitherto to be irresponsible. In a Liberal manifesto entitled “ 1955 Federal Elections- All the Answers “, an official Liberal publication, there is this statement -

Dr. Evatt is a great believer in the unlimited issue of central bank credit, for development, investment, higher wages and almost anything which requires money.

The Answer: The Prime Minister commented, “If the people ever voted for the Evatt policy, and it were put into operation, the effect would be that he would have to call on the Commonwealth Bank to create another few hundred millions every year.

This would result in a galloping inflation within six months and cut the value of money in half -within a year.”

That is an extract from an official Liberal publication. To-night, the Prime Minister described his deficit and the treasury-bill solution as “ radical finance “. It is galloping inflation if anybody else does it or thinks of doing it, but if the Prime Minister includes a treasury-bill issue in his Budget, it is “ radical finance “. Who is the Prime Minister to warn against galloping inflation? Is this not the right honorable gentleman who promised to put value back into the £1 in 1949 when bread was 7±d. a loaf? Every housewife knows that to-day bread cannot be bought for less than ls. 5d. Tea is 6s. 5id. per lb. to-day compared with 2s. 9d. per lb. in 1949; sugar is lid. per lb. now compared with 5d; butter has risen from 2s. 2d. in 1949 to 4s. 6d. per lb.; bacon costs 6s. lid. compared with 3s. 3d. per lb. and milk is Hid. a pint compared with 5d. in 1949. The pattern is the same throughout the list of household commodities. One can select any commodity and one will find that the price has increased by about 100 per cent. This is the Prime Minister who now warns us against inflation.

In this economic situation which the Treasurer has described as “ highly prosperous - one which is moving ahead”, we find that the value of our exports has fallen by £164,000,000 compared with their value in the preceding year, housing production has dropped sharply in the face of increasing demand, unemployment has reached unprecedented post-war heights, and farm income has collapsed to a depressingly low level. Yet the Treasurer says that we have a highly prosperous economy.

We all recall the little Budget which was introduced soon after the last federal elections in 1955. That, of course, is the technique of this Government. It invokes its most pernicious legislation immediately after an election in the hope that, with the passing of time, the people will forget. The little Budget was brought down soon after the 1955 elections. All the pernicious imposts of the little Budget of 1956 are absorbed and perpetuated in this Budget. In the little Budget, the Government used indirect taxation to increase its revenue by £115,000,000 a year. Those imposts have not been restored to the people but have been absorbed fully in the present Budget proposals. They include excessive and inequitable excise taxes on cigarettes, tobacco, beer and spirits, heavy sales tax charges on petrol, motor cars and other vehicles and on household essentials. This measure, which was described in 1956 as a temporary anti-inflation measure, still appears in the Budget that is under review. In this way, the Government has sabotaged the capacity to pay principle of taxation. It has struck mercilessly at the family man and in general against those who could least afford crippling taxation.

In what manner did the Treasurer approach the preparation of this pitiful apology for a Budget in the face of the economic crisis and threatening recession? He could hardly be justified in setting out to maintain the status quo. Yet he has failed to devise any plan to combat inflation or stimulate the nagging aspects of our national economy apart from minor concessions to the fishing and pearling industries, an increase in tax concessions for residents in remote areas and a tax concession to shareholders of oil exploration companies. The Budget is completely void of any economic device designed to correct any undesirable trend or, indeed, any apparent undesirable fact.

The Treasurer said in his Budget speech that there were some weaknesses in the economy. Surely, this is the understatement of the century. The right honorable gentleman said they would be countered by giving a broad stimulus to the economy, yet he has proposed to do precisely nothing towards that end. Referring to the difficulties in world trade, and taking into account the £50,000,000 fall in overseas balances, the Treasurer said that the Government -

  1. . believes that … it should take these difficulties as a stronger challenge to be up and doing.

Here again the Budget is silent as to what will be done; and the Government is up and doing nothing. One thing that should be done is to exercise some control over shipping freights. Our exports totalled £978,000,000 in 1956-57. They fell by £164,000,000 to £814,000,000 in 1957-58. Our ability to compete overseas has been impaired by high transport costs and, in particular, by spectacular increases in shipping freights. An analysis of the general position shows that between 1947 and 1955 shipping rates increased by 150 per cent, compared with an increase of 83 per cent, in rail freights, 66 per cent, in road freights, and 61 per cent, in air freights. Standover tactics by the conference shipping companies and current demands by these companies for a 10 per cent, increase in shipping freights cannot be tolerated when the welfare of the Australian people is at stake.

The Commonwealth Statistician shows in his quarterly review a schedule of freight charges operating at the end of December, 1949, and those operating in December, 1957. The Government must accept full responsibility for the fabulous increase which has occurred. The following table shows some of the increases in transport costs between 1949 and 1957: -

Those increases represent expenditure on our exportable commodities and are an imposition on the Australian community to that extent. The director of the Associated

Chamber of Manufactures, Mr. R. W. Anderson, said this about shipping freights -

The essential long range policy of Australia becoming a great exporter of manufactured goods is being sabotaged by the constant increases in our already top-heavy cost structure.

One might have thought that the drop in overseas prices of our rural products would have been offset by the fact that factory products now represent 41 per cent, of all export sales. Soaring freight charges, condoned by this Government, have obviated that possibility.

Has the Government any attitude to this vital problem which is so tremendously important to our great island continent, separated from the markets of the world by a wide expanse of ocean? What has happened to the Commonwealth Shipping Line - the great public instrumentality which was established to serve the needs of the Australian people? Has this Government cramped its expansion? I charge the Government with having deliverately set out to make this successful enterprise take second place to the flourishing service of private companies, operating on the Australian coast. Why is it not being encouraged to compete on overseas routes and so stabilize the shipping industry in a manner similar to that being achieved in the air by Qantas and Trans-Australia Airlines?

The best and most effective answer to the insistent, unrelenting demands of overseas shipping companies for higher rates of profit, which are already at record-breaking levels, is the application to the Commonwealth shipping line of a fierce competitive policy and an expansion programme financed by redirecting profits to the capitalization of new vessels.

I now turn to the question of unemployment. Nowhere in this Budget is there evidence of concern for the alarming trend in unemployment. Is this one of the principle reasons prompting the Government to seek an early election? How much worse will the position be in six months’ time? An examination of the Commonwealth Statistician’s figure shows the relatively good position which prevailed in the period preceding this Government’s election to office. In 1948-49, there were 1,573 people registered for unemployment benefit. In 1950-51, the first year of Liberalism, after Labour had been in office, there were 763 people registered for unemployment benefit. But in 1957-58 the monthly average moved upwards from 20,000 to 27,000. Only last night the Minister for Labour and National Service (Mr. Harold Holt) announced that the figure had risen by 490 since 28th June, and that 29,908 people were registered for unemployment benefit. The number of unemployed has risen from 763 in 1950-51 to 65,913 in August, 1958. The real number, of course, would probably be 100 per cent, in excess of that figure when we take into account the self-employed people and many others who do not bother to register as unemployed.

The indebtedness of the average Australian family is such that unemployment cannot be tolerated. Unable to rent a house, the average Australian has found it necessary to mortgage his future to the hilt in order to secure home finance and funds for essential furnishings. People are living a hand-to-mouth existence even though, in many cases, both the husband and wife have found it necessary to take employment. If some unforeseen circumstance results in a week or two of unemployment, the average family finds itself in a desperate situation.

How many Government members are aware of these things? Are they in contact with the people whom they represent, or is this government by remote control? Only ignorance of the position could result in this Budget being deficient in firm proposals to take up the slack in unemployment. The Treasurer said that although unemployment had increased to some extent it had not at any stage reached large proportions. Apparently, 60,000 to 70,000 people on the dole do not impress the Treasurer, who brushes the subject aside with casual indifference. The Minister for Labour and National Service, according to the Sydney “ Daily Mirror “, described the position as “ comparatively stable “. No one in the Liberal ranks seems capable of having any strong feelings about the misery and hardship involved. It is all a matter of course, so far as they are concerned.

Is this Government proud of Australia’s declining marriage rate? This has been brought about by a deficiency of housing and other factors for which the Government is responsible. Reference to official statistics shows that whereas the marriage rate per thousand of mean population stood at 9.71 in 1948, it had fallen to 7.64 at the end of 1957. Can we be satisfied with the falling birth rate which stood at 23.08 per thousand in 1948 but which fell to 22.86 per thousand in 1957? Is it not reasonable to assume that the Government’s failure to maintain the value of child endowment and the maternity allowance are factors contributing to this sorry state of affairs? Is it not a fact that while these allowances have remained stationary, the basic wage has increased by 128 per cent.? Why is the Budget and why are members opposite silent on all these important issues?

Is it any wonder that Australians are being forced into increasing indebtedness? Hirepurchase balances now total £333,000,000. The figure has more than doubled in the last five years. Over the last financial year, £1,000,000 worth of goods each day were sold on hire purchase - the poor man’s overdraft. In the first six months of the current year, the outstanding public debt to hire purchase companies increased by £58,000,000. Last financial year, the number of agreements on household and personal goods increased by 13 per cent, over the previous year and the value of the goods rose by 40 per cent. Is it likely that there would be such heavy dependence on hire purchase, with accompanying high interest rates, if ready cash were available for the purchases?

When will the Government face up to the need for Commonwealth control over this vital sphere of economic activity, which accounts for more than 25 per cent, of the credit currently being extended to the Australian people? Who can deny the inability of the States effectively to regulate hire purchase when any company seeking to escape the restricted effect of State legislation simply registers in a State where no such restriction operates? Who can deny that excessive profit rates are announced almost every day through the press and that incredibly high dividends are guaranteed to investors in advertisements in the daily press? Yet there is nothing in the Budget to arrest these alarming trends. Is it any wonder that the Government is unable to persuade bond holders to reinvest in Government loans and that public instrumentalities concerned with local government, water, sewerage, electricity and other essential services are unable to secure funds for expansion? In the area administered by the Sydney Metropolitan Water, Sewerage and Drainage Board, for example, whereas 566,299 properties are serviced with water, only 361,348 are serviced with sewerage. In my own electorate, the people bear the brunt of the Government’s inactivity in the matter of ensuring that resources are channelled to essential development. Throughout the Sutherland Shire local government area, the Metropolitan Water, Sewerage and Drainage Board provides a water service to 25,000 properties. Of these, only 1,300 are serviced with sewerage. It is a shocking indictment that, of 25,000 houses in a Sydney local government area - the Shire of Sutherland - 24,000 old-fashioned sanitary services are rendered in place of modern sewerage services. In seventeen of Sydney’s local government areas, over 120,000 are still served with primitive sanitary arrangements more typical of a primitive community in the dark ages than of a twentieth century topline western city. Every one knows that the Romans in their ancient civilization had better drainage and sewerage systems than ours. Melbourne and Brisbane are in the same difficulty as Sydney is.


Order! The honorable member must relate his remarks to the Budget.


– Let me refer to another example of how essential public services are starved for funds. I take as an example the Postmaster-General’s Department. According to the last report tabled by the Postmaster-General, 73,000 telephone applications are outstanding. Tens of thousands of prospective subscribers, both private and business, have not even bothered to apply knowing full well the hopelessness of the position. In my electorate, some telephone applications have been outstanding for the full period for which this Government has been in office.

Now let us look at the housing position. The Government makes no provision in this Budget for the stimulation of the housing programme. While unlimited finance and materials are being directed to the construction of service stations, luxury hotels at Surfers’ Paradise, the Gold Coast and other pleasure resorts, we find an actual decline in essential home-building. Professor Downing, Professor of Economics at the Melbourne University, stated recently -

Australia’s deficiency of 115,000 homes in 1956- was now being overtaken at the rate of 10,000 a year instead of the 20,000 of two years ago.

Many people contend that the genuine back lag of houses is closer to 300,000, taking into account the need to replace old and sub-standard houses. The official figures show that in 1954-55 there were 75,481 houses commenced. They also show that in 1955-56 the number commenced was 70,898, and that in 1956-57 it was 67,325. There has been a decline all the time under this Government.

Does not the Government realize that finance is the answer to the housing problem? When will the Treasurer wake up to these things? This Government has done nothing to increase the supply of cheap money for housing. Even the CommonwealthState Housing Agreement has been mutilated from its original form to reduce the output of homes.

This year, as was the case last year, the Commonwealth requires that 10 per cent, of the finance made available to the States under the Commonwealth-State Housing Agreement shall be earmarked to build houses for serving members of the forces. In addition, 20 per cent, is directed through building societies. Previously, of course, building societies obtained their funds from banks and insurance companies, but this source has dried up as the proceeds of banking and insurance are now applied to hire purchase and more profitable fields of investment. Every bank has moved into this field of investment. This state of affairs can, and must be remedied, but none of these things has received attention in this Budget.

Building societies, of course, do a wonderful job, but these days, in the main, they can finance only 80 per cent, of the cost of a home. The applicant needs a block of land of an average value of £800. In addition, he needs £800, or 20 per cent, of the cost of a home.


Order! The honorable member’s time has expired.


.- I hope it has been made clear that the preceding speaker was the honorable member for Hughes (Mr. L. R. Johnson). I hope that his speech will not be confused with that of my colleague the honorable member for Hume (Mr. Anderson). It is necessary that I make it clear to the public that no despair is felt on this side of the chamber. It is also essential that I emphasize that the speech delivered by the honorable member for Hughes was full of inconsistencies. For example, as I shall show later, it is completely at variance with what his own colleague, the honorable member for Port Adelaide (Mr. Thompson), has said about the supplementary pension to be paid in cases of hardship to certain pensioners.

This Budget debate has brought to us the experience both of farewells and a welcome. The Treasurer (Sir Arthur Fadden) has made his last Budget speech in this chamber; that fact has been announced publicly. We pay every respect to him for the preparation of the Budget now under review. I shall refer to the Treasurer again in a moment or two.

While speaking of farewells, I turn also to the honorable member for Kalgoorlie (Mr. H. V. Johnson). I have two reasons for referring to. him. The first is that he comes from Western Australia and I, too, have the privilege of representing a Western Australian electorate in this House.

Mr Curtin:

– But only temporarily.


– We shall see about that in due course. We are quite confident. We are also impressed with the fact that the honorable member for Kalgoorlie has been held in the highest esteem by honorable members on the government side, as well as by members of his own party. Last week, he chose to indicate that his speech during this debate was probably his swan-song - indicating the end of what we all know to be a very long and meritorious parliamentary career. I take this opportunity, therefore, of stating publicly how high we have held the honorable member in our esteem. We have found him to be a gentleman, and to-night we pay tribute to the service he has given to his country. We also point out to those who are listening to-night that what he left unsaid during the splendid speech he delivered last week speaks for itself. He indicated that for some considerable time he had been under extreme tension. What he left unsaid can be easily interpreted from what he has said on previous occasions. We also pay tribute to him for the loyalty which he has demonstrated.

Turning now to the welcome, I speak of the honorable member for Parramatta (Sir Garfield Barwick), who delivered an excellent maiden speech last Thursday evening. We welcome the honorable member because of the high esteem in which he is held. We welcome him for his learning and because we believe that he will be a splendid addition to this Parliament.

True to Australian tradition, the Treasurer has been caricatured, ridiculed and criticized in the many references that have been made to his final Budget, but, upon more mature reflection, the thinking members of the public have given him his modicum of praise. I believe that this country is heavilyindebted to him for the service he has rendered during his term as Commonwealth Treasurer. Few men have had such a varied experience for so long and1 with such excellent results. I join with all my colleagues - and I believe that all other honorable members of this Parliament, if they are frank, join with them - in wishing the Treasurer a very happy retirement.

During the course of his Budget speech, the Treasurer referred to the fact that the Government did not want to mortgage the future by making further tax concessions. He made it clear that prevailing influences upon the economy of this country even now necessitated budgeting for a cash deficit. Much of the debate has centred on this point. My leader, the Prime Minister (Mr. Menzies), himself very adequately informed the committee earlier this evening of the significance of budgeting for a cash deficit of this nature. In such circumstances, what folly it would be to increase substantially this deficit of £110,000,000 mentioned in the Budget speech! Yet there are those who would expect us to announce further tax concessions. I am reminded of the wordsof Sir Winston Churchill, admittedly uttered* some years ago, but uttered, when he was- dealing with the United Kingdom budget at the end of an extremely difficult year. He said -

It would be easy to give an epitome of the financial year which has closed. The road has Jain continually uphill, the weather has been wet and cheerless and the Lords Commissioners of His Majesty’s Treasury have been increasingly uncheered by alcoholic stimulants. Death has been their frequent companion and almost their only friend.

The last year in Australia has not been as desperate as that, but let me remind honorable members that seasonal problems, which are quite beyond the control of any government, have prevented the Government from implementing plans that have been in mind and in hand for this particular period. But nevertheless, in the face of great difficulties of this kind - and well do we know the magnitude of the seasonal difficulties - let me remind honorable members that success has been achieved in many fields.

The honorable member for Hughes spoke about housing. I want to contradict what he said about housing and to tell honorable members of the encouraging increase in “home-building. On 12th August this year the Minister for National Development (Senator Spooner) released figures showing that 74,333 houses and flats were completed in 1957-58, representing an increase of 8.6 per cent, over the previous year’s figures. Dwellings - houses and flats - commenced in Australia in the last financial year totalled 72,905, an increase of almost 5 per cent, on the 1956-57 total, and the “highest figure since 1954-55. The Minister drew attention to the encouraging improvement in New South Wales, the very State from which the honorable member for Hughes comes. The Minister said that more than 25,700 dwellings were commenced in New South Wales in 1957-58, representing an increase of 5.7 per cent, over the preceding year’s figures.

I emphasize that the basic structure of the Budget under debate is undeniably sound. I need hardly say more than that in view of what has been said by other speakers, particularly by the Prime Minis.ter (Mr. Menzies) this evening. Surely this is a time when the Government must watch the stability of Australia’s finances. We are endeavouring to build adequately and sensibly for the future. Related to that aim is the splendid immigration programme that this Government is proud to present once again to the nation and which will be maintained at the same level as last year. We are at a stage also when a sound government should avoid buying popularity, and I am proud to be associated with a government which, on previous occasions, has been big enough and broad enough in its national outlook to make unpopular decisions. To many people this Budget may be unpopular, but the debate is clearly showing how sound it is to suit our conditions. As a young nation we cannot afford catastrophic financial blunders of the kind into which the Leader of the Opposition (Dr. Evatt) would lead us. I say that deliberately, bearing in mind the foolish claims that members of the Opposition have made during the course of this debate. The Leader of the Opposition, I submit, was tilting at windmills with regard to many of the things that he touched upon during his speech. In the past Australia has scorned the dangerous pre-election promises of the right honorable gentleman, and this country is close enough now to a federal election to read into some of his statements the type of policy that he will later announce. He is renowned for his dangerous financial policies. He seems to be in the wilderness when it comes to dealing with national finances. Surely his reputation is such that the Australia electors will later this year again scorn his unstable and far-fetched budget proposals or suggestions.

If I had adequate time I would deal in detail with the fact that New Zealand’s experience of recent months justifies the Budget that has been brought down by the Government. Perhaps I should remind honorable members of the manner in which the Nash Government in New Zealand came into office. It came into office because of the spectacular and most highly publicized pre-election promise with regard to the £100 tax rebate. Despite the fact that the terms of trade had moved against New Zealand during the latter half of 1957, and, with falling exports prices and rising import prices, there was the probability of a short, age of goods, and strong inflationary pressures, the New Zealand public was exhorted to go on a buying spree. Christmas sales of radiograms, sewing machines, outboard motors and other luxury items were a record. At a time when any government must face difficulty in its revenue collections for the coming year, the Labour party in New Zealand at that time had chosen to give away an election bait of £21,000,000 in tax rebates. Other speakers before me from this side of the chamber have mentioned some of the additional promises made by Labour in New Zealand. A fair estimate of the total cost of these additional recurring charges over and above the £100 tax rebate is between £27,000,000 and £30,000,000. In 1958-59, which is turning out to be one of the worst financial years in New Zealand’s history, these charges, added to the cost of the £100 tax rebate, would, if implemented have amounted to almost £50,000,000.

What has been the result? Inevitably the Nash Government in New Zealand is failing to carry out many of its promises. Why do I say that New Zealand’s experience should be borne in mind by Australia? I say it because we have had evidence before of foolish promises of this kind presented by the Leader of the Opposition. By April, the Labour Government in New Zealand had raised a loan of £20,000,000 in London - something which it had said that it did not believe in doing. Then the Nash Government had to turn to Australia for a helpful loan of £10,000,000. After the £21,000,000 return of taxes to the New Zealand people by the incoming Labour Government, the day of reckoning came. On 26th June last the most drastic tax increases ever inflicted on the New Zealand people were announced by the Minister for Finance. Even during the last war the extra demands made in any one budget were not as severe as those announced only a month or so ago.

I draw attention to this drastic history of a neighbouring nation to point out that Labour has brought New Zealand to this sorry situation. I also draw attention to the similarity between what has occurred in New Zealand and what the Opposition would lead Australia into.

The Budget undeniably provides valuable concessions for some people and I should like to refer first of all to what has been done under the heading of social services. Earlier in my speech I promised to refer to a statement made during the course of this debate by the honorable member for Port Adelaide. He said, with reference to the hardship pension -

The proposed 10s. a week increase in pension will be a wonderful boon to a lot of people - not just a few people, as the honorable member for Hughes would have us believe -

I know that many men and women who receive a pension of £4 7s. 6d. a week have to pay room rent of £1 10s. or £2 a week, as well as provide for themselves food, clothing, light, and warmth. They have a terrible time trying to exist, and the proposed increase will help them considerably. Therefore, I am glad that the Government has gone at least that far.

Opposition members may say that many pensioners are raising their voices in protest, but let me remind them that at least one pensioner organization in Sydney has written in praise of the Budget concession.

There is also to be a raising of the ceiling of the property means test. I would suggest that in the not too distant future the Government might see fit to abolish that means test entirely, for the extra cost involved would be surprisingly low.

Other speakers have referred adequately to the concession to be given companies engaging in the search for oil. The Government’s proposed amendment of the Income Tax Act has been designed to stimulate the search for oil in Australia, and to encourage local investment in companies undertaking it. Some overseas companies have declined to invest further capital until there is more encouraging evidence within their existing field of operations, and it has become imperative that Australian investors who, after all, have the greatest stake in the country’s future, should be persuaded to make a greater contribution than they have done in the past. The concessions which formerly applied will be extended to include all capital subscribed by resident taxpayers - not being subsidiaries to overseas companies - for shares in oil search companies. We should all have a great deal of hope and confidence in the future of Australian oil1 search. The day may not be far distant when there will be a satisfactory discovery which will be of immense value to our expanding economy.

I should like now to make some specificcomments about the needs of the northwest of my own State of Western Australia-

During the winter recess it was my privilege to be one of a group of 28 parliamentarians and businessmen who, through the courtesy of West Australian Newspapers Limited, completed an itinerary covering eleven days in the Kimberleys and the area immediately to the south. We found, on that splendid trip, that we were “visiting a lonely land mainly beyond the twenty-sixth parallel. If I may use the very attractive and challenging words of a journalist, we found it to be an empty land whose northern extremities were as close to Saigon as to Canberra; a vast tantalizing land that inspires dreams of development and withers them in hot, red dust; a land virtually undiscovered by most Australians, yet holding in thrall a persistent handful of people - angry people who often feel forgotten and neglected; a land making slow progress after an era of drought and defeat; its people believing passionately in what could be - if the big drought, the money drought, would end.

One might well ask honorable members what they believe to be the potentialities of the Kimberleys and the area immediately to the south of that distant section of Australia. Time will not permit to remind the House in detail of the expanding industries to be found there. I have in mind cattle, sheep, the possibilities for the mining of manganese and of blue asbestos, the splendid results achieved at the Kimberly Research Station in the growing of sugar, cotton and other agricultural crops, the development of fishing, the continuance of pearl shell production, the amazing and most interesting development in the culture of pearls at Brecknock Harbour, some 200 miles north of Broome, and the fantastic potential for the growing of rice. These are but some of the possibilities of vast expansion.

Coming now to the reference to the northwest in the Budget speech itself, the zone allowances and the increased allowances for dependants are by no means negligible. Persons now resident in zone A will become entitled to a 50 per cent, increase in their allowance, which moves up from £180 to £270, plus an amount equal to one-half of the total deductions allowable for the maintenance of dependants. A man living in zone A and maintaining a wife and three children will thus be entitled to a total zone allowance of £452. That is not by any means an insignificant sum. Similarly, there has been a helpful increase for those who reside in zone B. The Prime Minister (Mr. Menzies) has assured us that the claims of the north-west are still under consideration. Recently, in reply to a question which I asked in the House, he said that the Budget proposals were not the final word for the north-west. I am happy to-night to be able to assure those who may feel aggrieved that not only has greater assistance been given to the north-west as a result of the personal visit of the Prime Minister and other Government representatives, but that even that is not the last word on the subject. Also, we should remember that the sum of £2,500,000 so recently approved for spending in the area has not yet, in fact, been spent. Perhaps when the money has been substantially spent on approved projects it will be more appropriate to suggest that many more millions must be spent upon the development of the north.

Further help is to be given to those who are taking part in the Commonwealth scholarship scheme. I am delighted that the Government, in answer to the many representations made in the interests of the students, has been able, even in this difficult year, to raise the scholarship allowances.

My State, in common with New South Wales, has the misfortune to be led by a socialist Labour government. The last few years have been difficult, in many respects, for Western Australia but the major responsibility for that rests not with the Commonwealth Government but with the State Labour government. I refer to its unsound financial planning, its unhealthy housing scheme, the restrictions which it has imposed upon the migrant intake, and the colossal blunder of applying unfair trading legislation - in my opinion the worst piece of restrictive socialist legislation in Australia. All these things have prevented the forward march of our western State at a time when it should be competing with South Australia and other States in the matter of development.

I wish, now to refer to the July report on Economic Activity in Western Australia, by Dr. Alex Kerr, who is senior lecturer in economics at the University of Western

Australia. In table 4 of his report, which refers to demographic changes, he suggests that a considerable falling off has occurred in the rate of population increase for 1957-58. Although the rate of natural increase has been maintained, a large outflow to the eastern States and a drop in the rate of migrant inflow have combined to drag down the total population increase to the lowest figure for some years.

In table 5, dealing with civilian employment, he indicates that the hoped-for rise in employment in the same year has not taken place. Table 6, which deals with employment statistics, supports the conclusions drawn from table 5. Dr. Kerr says that the figures are rather disquieting, though not alarming. Unfilled vacancies remain at a relatively low level. Nevertheless, effective employment at present is probably not much more than 3 per centof the labour force or21/2 per cent, of the work force. Those are good percentages for the honorable member for Parkes (Mr. Haylen) to be reminded of in view of his reference - admittedly, some time ago - to a figure of 5 per cent.

Western Australia’s fortunes, Mr. Chairman, are largely linked to movements in the international prices of primary products. From an acceptable surplus in 1957, the Commonwealth has come to this deficit in 1958. Farm income is down by £180,000,000. Our total exports are £164,000,000 less. The effect of these factors on Western Australia is much more serious than upon Australia as a whole. Time does not permit me to deal with all the economic contrasts between Western Australia and Australia in terms of values per head of population that I should like to present, but let me give these few figures quickly: The net value of primary production per head of population in 1955-56 was £119 for Australia and £150 for Western Australia. The value of exports f.o.b. for Australia in the same year was £84, and for Western Australia it was as high as £173. Commonwealth Government capital expenditure as a percentage of gross public investment in the year 1952-53 - the latest figure that I could obtain - was 16.4 per cent, for Australia and only 8.5 per cent, for Western Australia. So, Mr. Chairman, I submit that the heavy reduction in income from primary production in 1957-58 will have a much more serious effect upon the economy of Western Australia than upon the rest of the country. Western Australia’s per capita contribution is higher, and therefore the reduction per head of population is so much greater than for the rest of Australia. I wish to stress the importance of Commonwealth capital works with a substantial labour content in meeting this situation in my own State. My attitude, of course, is not one of non-recognition of what has already been done for the State, for, when I refer to the Budget papers, 1 find that, in the ensuing financial year, Western Australia will receive some 12.5 per cent, of the payments to the States compared with 12.8 per cent, in the financial year which has just closed.

What could the Budget have included with a little more financial freedom? I should have liked, of course, along with many others, to see some sales tax anomalies adjusted. Particularly should I have liked to see some concession to the private bus operators, who urgently need help either by way of sales tax remissions on the vehicles and parts that they purchase or in some other suitable form. I should have liked to see a further implementation of the remaining sections of the Hulme report on depreciation, and in due time I hope to see the abolition or the further reduction of the pay-roll tax which I hope will be possible. Naturally, because of my interest in Australia’s youth, I hoped that we would have had freedom to provide in a more effective way for youth leadership training and the stimulation of national idealism among the young people of Australia. I therefore hope, Mr. Chairman, that proposals which I have recently presented to the Government may be implemented, particularly for the continued development of Australia, and that they will depend, not upon good Budgets alone, but upon dedicated young people who will become the national leaders of to-morrow.

Progress reported.

page 519


Bill received from the Senate.

Standing Orders suspended.

Bill (on motion by Mr. Cramer) read a first time.

House adjourned at 11.17 p.m

page 520


The following answers to questions were circulated: -

Public Service


olt asked the Prime Minister, upon notice -

  1. What number of persons was employed in the office of the Public Service Board during each of the years ended June, 1955 to 1958, inclusive?
  2. How many of these persons during these years received up-gradings by reclassification?
  3. What proportion do (a) numbers employed and (b) up-gradings bear in relation to all other Government departments?
Mr Menzies:

– I have now obtained an answer to the honorable member’s question, which is -

  1. The number of persons employed by the Public Service Board in the years indicated was as follows: -

Excludes Typists-in-training who are attached to the Public Service Board during a training period of from six to nine months. After this training course they are placed in departments. The number of trainees so attached was as follows: -

  1. The number of officers who received upgradings by reclassification is shown in the table below -
  1. (a) The relationship between total staff of the Public Service Board and total staff in all departments under the Public Service Act was -
  1. The number of persons up-graded by reclassification in all departments is not readily available.


Mr Daly:

y asked the Minister for Labour and National Service, upon notice -

  1. How many (a) males and (b) females are now registered as unemployed in (i) each State and (ii) Australia?
  2. What are the occupations of these persons and how many are in each category in each State?

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

  1. The numbers of males and females registered for employment with the Commonwealth Employment Service in each State and in Australia at 1st August, 1958, were -

These were persons who claimed when registering with the Commonwealth Employment Service that they were not employed and who were recorded as unplaced at that date. They include persons referred to employment but whose placement was not then confirmed, those who may have secured employment without notifying the Commonwealth Employment Service, and those receiving unemployment benefit.

  1. Those registered for employment at 1st August, 1958, were registered in the following occupational groups: -
Mr Daly:

y asked the Minister for Labour and National Service, upon notice -

  1. How many (a) males and (b) females are registered as unemployed at the Newtown Employment Office?
  2. What are the occupations of these persons and how many are in each category?

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

  1. At 1st August, 1958, 704 males and 354 females were registered for employment at the Newtown District Office of the Commonwealth Employment Service. These were persons who claimed when registering that they were not employed and who were recorded as unplaced at that date. They include persons referred to employment but whose placement was not then confirmed, those who may have secured employment without notifying the Commonwealth Employment Service and those receiving unemployment benefit.
  2. Those registered for employment at 1st August, 1958, were registered in the following occupational groups: -

Retail Prices

Mr Daly:

y asked the Treasurer, upon notice -

  1. What was the retail price of (a) butter, (b) margarine, (c) tea and (d) sugar in December, 1949?
  2. What is the retail price of each of these commodities to-day?
  3. What was the subsidy paid on (a) butter and (b) tea in (i) 1949 and (ii) 1958?
Sir Arthur Fadden:

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

  1. The weighted average retail prices in the six State capital cities during December, 1949, were 2s, 2d. per lb. for butter; ls. 9id. per lb. for margarine; 2s. 9d. per lb. for tea; and 5d. per lb. for sugar.
  2. The corresponding: prices during June, 1958, were 4s. 6d. per lb. for butter; 2s. 9id. per lb. for margarine; 6s. 7d. per lb. for tea; and lOd. per lb. for sugar.
  3. The subsidies paid on dairy products and tea in the financial years 1949-50 and 1957-58 were as follows. -

Land Settlement of Ex-servicemen.

Mr Whitlam:

m asked the Minister for Primary Industry, upon notice -

  1. How many holdings were allotted, and what expenditure was incurred by the Commonwealth and the State, under the war service land settlement scheme in each State in each of the last three financial years?
  2. How many applicants are still awaiting holdings in each State?
Mr McMahon:

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

The classification of applicants and the allotment of holdings to ex-servicemen under the War Service Land Settlement scheme is done by the States. In some cases, statistics of allotment are compiled for the calendar year and not the financial year. The figures hereunder accordingly comprise an arbitrary apportionment in such cases. 1. (a) Holdings allotted -

In South Australia, Western Australia and Tasmania, there are many farms occupied by ex-servicemen which have not yet attained the productivity necessary for formal allotment. They have not been included in the figures above. 1. (b) Expenditure by States -

Note. - (i) The figures for New South Wales and Victoria include the special advances made available by the Commonwealth as follows: -

The figures for South Australia, Western Australia and Tasmania are the amounts contributed by these States towards the excess of cost of providing holdings over the valuations placed on them. 1. (c) Commonwealth expenditure - Noncapital -

Note. - (i) The figures for New South Wales, Victoria and Queensland represent the contribution towards losses on advances to settlers, the excess of cost of holdings over valuations, the remission of rent and interest during the first year following allotment and the provision by the Commonwealth of a living allowance for that period.

The figures for South Australia, Western Australia and Tasmania comprise, in addition to the items under Note (i), the cost of operating irrigation headworks, maintaining vacated holdings pending re-allotment and the cost to the State of administration of credit facilities, which is reimbursed by the Commonwealth. 1. (d) Commonwealth expenditure - Capital -

Note. - In addition to the cost of acquiring and developing land and the provision of credit facilities to settlers, expenditure on plant and stores for development and camp accommodation, &c, are included in the figures.

Although the various States did, at one time, endeavour to make a survey of the number of original applicants who were still awaiting farms under the scheme, the figures obtained were not conclusive. It can be stated, however, that Victoria, Western Australia and Tasmania, each considers the number of farms at present in sight will satisfy demand. In South Australia, sufficient suitable land is not available to meet demand, but an all-out effort is being made this year to obtain as much suitable land as is possible. New South Wales has indicated there is a fairly substantial number still awaiting farms, but it is pointed out that those who have been unsuccessful in the ballots held have also had the opportunity over the years of finding farms for themselves and applying for them to be purchased under the Promotion provisions of the State act


Mr Whitlam:

m asked the Minister for Primary Industry, upon notice -

To what countries, in what quantities and at what average price have Australian eggs been sold in shell and in pulp in each of the last ten years?

Mr McMahon:

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

The following are the prices received for eggs in shell from the four main destinations and for liquid whole egg from the two main destinations. Prices are in Australian currency: -

page 524


Commencing from January, 1949, fixed prices for all sales of Australian eggs to Singapore were determined by the Australian Egg Board. These prices per dozen have been -

page 524


Prior to 1st July, 1955, the State Egg Boards competed between themselves for this market and prices varied widely. As from 1st July, 1955, the Australian Egg Board fixed the prices for the Hong Kong market. Prices since then have been -


Mr Ward:

d asked the Minister representing the Minister for National Development, upon notice -

  1. What price is being received by Australia for its uranium ore exports?
  2. If he adheres to the former decision not to divulge this information, will he state whether the price received is greater or less than that obtained by other major world producers?
  3. Would it be good business, in view of our decreasing overseas funds, to secure the full world price for uranium produced in this country?
Mr Townley:

– The Minister for National Development has replied as follows: -

  1. The only uranium ore exported has been sold by a company on terms approved by the Commonwealth Government. The terms, however, are a matter of commercial confidence between the parties to the contract. The same condition of confidence applies to the contracts for the sale of uranium oxide. 2 and 3. The prices received by Australia are no less favorable than prices being received by other major world producers.

Snowy Mountains Scheme


ser asked the Minister representing the Minister for National Development, upon notice -

  1. What is the purpose of the construction by the Snowy Mountains Hydro-electric Authority of the Tantangara Dam at Kelly’s Plain?
  2. What effect will the construction and operation of this dam have on the flow of water in the Murrumbidgee River as it traverses the length of the Australian Capital Territory?
  3. Is the Tantangara Dam to be what is called a “ cut-off “ dam?
  4. Will the Tantangara Dam divert to Lake Eucumbene all of the water which the Murrumbidgee River receives from the catchment area of the snow country in the vicinity of Kelly’s Plain, Rulo’s Point, Long Plain and Tantangara?
  5. Has any provision been made to maintain a minimum stream flow in the Murrumbidgee River below the dam site; if not, why not?
  6. If the whole of the flow of the Murrumbidgee River at Tantangara is diverted to Lake Eucumbene, would the Murrumbidgee River below the dam practically cease to exist during dry summer months?
  7. In those circumstances would the only considerable tributaries of the Murrumbidgee River below the dam site be the Sam’s, Umeralla, Gudgenby and Cotter Rivers?
  8. Have measurements been made of the summer flow of these rivers?
  9. Is it likely that the whole summer flow of these rivers could be absorbed by the large sand flats of the Murrumbidgee River?
  10. Has full consideration been given to the effect which cessation of the main flow of the

Murrumbidgee River will have on the farming lands and pleasure resorts along its length in the Australian Capital Territory?

Mr Townley:

– The Minister for National Development has furnished the following reply: -

  1. Tantangara Dam will divert water from the upper catchment of the Murrumbidgee River into Lake Eucumbene. From Lake Eucumbene water will be diverted to the Tumut River where it will be used through the five Tumut River power stations and will finally be discharged from Blowering Reservoir and thus returned to the Murrumbidgee.
  2. On an average the diversion of water from Tantangara will reduce flow in the Murrumbidgee at the Cotter Crossing by approximately 27 per cent. Of the 2,600 square miles catchment area of the Murrumbidgee at Cotter Crossing the catchment at Tantangara dam site is only 182 square miles.
  3. Tantangara Dam is designed to store and divert the waters of the Upper Murrumbidgee into the tunnel leading to Lake Eucumbene. The dam will cut off the whole flow of the Murrumbidgee except at times of very high flood or very low flow as referred to in the answer to Question No. 5.
  4. Yes, except in periods of high flood or very low flow, as stated in answer to Question No. 3. 5 and 6. Provision has been made in the design of the dam to release water down the Murrumbidgee River during periods of very low flow. The quantity of water to be released will depend on requirements and tributary inflow, but will be sufficient to maintain a flow of 34 cusecs or a quantity equal to the natural inflow into the reservoir at the time, whichever is the lesser.
  5. The main tributaries of the Murrumbidgee River between Tantangara dam site and Burrinjuck dam are Yaouk Creek (Sam’s River), Goorudee Rivulet (Little River) and the Umeralla, Gudgenby, Molonglo and Cotter Rivers.
  6. Flows are measured regularly in the following streams: - Yaouk Creek, Goorudee Rivulet, Umeralla, Murrumbidgee, Gudgenby, Naas, Cotter and Molonglo.
  7. During the only periods when this could possibly occur, i.e. at times of extremely low flow, the total inflow to the storage will be released through the dam (see 5) and this will result in the present natural conditions being maintained at such times.
  8. In the design of Tantangara dam full consideration has been given to the effect of the diversion to Lake Fucumbene on the Murrumbidgee River downstream to Burrinjuck reservoir. The requirements of the Water Conservation and Irrigation Commission of New South Wales have been ascertained and this Commission in turn contacted the Department of the Interior regarding Australian CapitalTerritory requirements.

Canberra Communications Services


ser asked the Minister representing the acting Postmaster-General, upon notice -

  1. In view of the transfer of departments from Melbourne to Canberra next year, and the consequent increase of population and the extension of suburban areas, what arrangements have been made to provide adequate postal, telegraphic and telephone services?
  2. Is his department maintaining close liaison with the. National Capital Development Commission, the Department of the Interior and the Department of Works in relation to the provision of services?
  3. Will every step be taken to ensure, in relation to telephone services particularly, that, so far as possible, delay in the provision of subscribers’ services will be eliminated?

– The acting PostmasterGeneral has furnished the following replies: -

  1. Letter and telegram delivery services are being extended to new homes as they become occupied and this practice will be continued. A postmen’s depot was recently established in temporary premises at Ainslie to cater for development in the northern section df Canberra. The need for additional post office buildings will be closely watched in the light of the prospective trend of expansion, including the establishment of business and shopping centres. Additional street letter receivers will be provided as they become warranted. The capacity of the Canberra automatic telephone exchanges is to be increased by 4,800 lines spread over the next three years and work has already commenced on the installation of 600 lines of equipment at the Civic Exchange. Underground cable works will also be undertaken to meet the development
  2. Yes. A meeting of departmental representatives and the National Capital Development Commission was arranged for the 7th August to discuss all aspects.
  3. Yes.

Telephone Directories

Mr Daly:

y asked the Minister representing the acting Postmaster-General, upon notice -

  1. Is it proposed to print this year’s Sydney telephone directory in sections; if so, in how many sections?
  2. As the present volume is extremely difficult to read because of the smallness of the type used, will the Minister give consideration to printing all sections of the new directory in larger print?

– The acting PostmasterGeneral has furnished the following reply to the honorable member’s questions: -

  1. No. However, the 1958 issue of the Sydney telephone directory will be the last combined alphabetical and classified publication. A separate classified directory will be issued in October, 1959, followed by a separate alphabetical publication in May, 1960. Subsequent issues will be published at twelve-monthly intervals thereafter in each case.
  2. The type, namely 6-point bell gothic type, which was developed specially for telephone directory purposes is of the same size and design as that used in most of the main telephone directories overseas and can be read with reasonable ease in good light by persons with normal eyesight. Many newspapers and other publications contain a considerable proportion of type of the same size or even smaller than that used for directory entries. The British Post Office after experimenting for three years decided twelve months ago to adopt for the United Kingdom telephone directories type of the same size and design as that used in Australia. The publication of separate volumes will add considerably to production costs and the adoption of a large type is not favoured as it would increase these costs still further and offset the advantage of dividing the book owing to the greater number of pages necessary to accommodate the entries printed in type of the larger size.

Telephone Services

Mr Daly:

y asked the Minister representing the acting Postmaster-General, upon notice -

  1. Is it a fact that persons who have had telephones connected for lengthy periods have recently had their services transferred to the duplex system?
  2. Has this action been taken particularly in the Marrickville area of my electorate?
  3. Under what authority, in the absence of permission from subscribers, does the department transfer telephones to the duplex system?
  4. What is the attitude of the department to duplex services?

– The acting Postmaster-General has furnished the following reply: -

  1. The services of some subscribers with low calling rates have been converted to duplex operation in order to provide telephone connexions for applicants who would otherwise have had to wait a considerable time for service. Some of these exclusive services had been leased for lengthy periods.
  2. No. The practice is followed in any automatic or central battery manual exchange area where telephone service cannot be provided for applicants by other means.
  3. Regulation 59 of the Telephone Regulations under the Post and Telegraph Act.
  4. Except that the two parties sharing the line to the exchange cannot use their services at the one time duplex connexions provide the same features as exclusive lines such as separate telephone numbers, separate calling and ringing, individual metering of calls and privacy of conversation. This being so the likelihood of the line being used by one party to the detriment of the other party is remote in cases where the calling rates of the parties are low. In these circumstances duplex connexions provide a satisfactory method of giving service in areas where exclusive lines are not available to meet application.

Mail Exchange Building, Redfern

Mr Cope:

e asked the Minister representing the acting Postmaster-General, upon notice -

  1. How many (a) families and (b) persons will be displaced from their present dwellings by the Mail Exchange building which the Government proposes to erect at Redfern?
  2. Will residents who are affected be guaranteed alternative accommodation by either the Commonwealth or the State Government; if so, what are the details?

– The following answers have been furnished in reply to the honorable member’s questions: -

  1. If the proposal for a new Mail Exchange at Redfern now being considered by the Parliamentary Standing Committee on Public Works is implemented the demolition of 56 houses occupied by (a) 89 families and (b) 355 persons will be involved.
  2. Should the project be endorsed by the Standing Committee, it is proposed to discuss with the State authorities the matter of providing alternative accommodation.

Hospital and Medical Benefits Scheme

Mr Ward:

d asked the Minister for Health, upon notice -

  1. What was the total value of members’ contributions to recognized medical and hospital benefit funds in each year since the inauguration of the present Commonwealth Health Scheme?
  2. What was the value of benefits paid to members during each year?
  3. What is the name of each recognized medical and hospital benefit fund?
  4. What was the total cost of administration of these organizations during each year?
  5. Have the rates of members’ contributions been increased since the present scheme commenced; if so, to what extent?
  6. Has the scale of benefits to members been improved or increased at any time; if so, what are the details?
  7. Is it a fact that an ailment from which a member suffered prior to enrolment in a fund is excluded for the purposes of payment of benefit; if so, is the disqualification limited to a period of time or does it remain indefinitely?
  8. Are members who contract an ailment, which is frequently declared to be chronic, entitled to receive benefits for an indefinite period of time?
  9. Has the proportionate value of member benefits to hospital and medical costs been maintained since the present Commonwealth Health Scheme came into operation?

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

  1. There are 81 registered medical benefit organizations and 118 registered hospital benefit organizations. I shall furnish the honorable member with a list of them.
  1. There has been no general increase in rates of members’ contributions.
  2. The scale of benefits has been increased. The funds have introduced higher benefit tables. The Commonwealth has revised the medical benefits provided under the Act. The Commonwealth has provided an increased benefit for hospital fund contributors insured for 16s. or more per day.
  3. There are no exclusions of this kind on the payment of Commonwealth hospital or medical benefit. In general, fund hospital benefit is not paid for an ailment in existence when the member joined the fund. Usually fund medical benefit is not payable for such an ailment, although the major medical benefits organizations do pay benefits for such ailments after two years’ membership.
  4. In general, hospital benefit organizations do not pay fund benefit for chronic ailments, but medical benefit organizations do. These payments of benefit are subject to certain maximum annual limits which vary as between organizations.
  5. The proportion of benefits to cost of services varies in individual cases, but the overall position is that there has been little variation from year to year in the proportion of benefits paid to cost of services.
Mr Whitlam:

m asked the Minister for Health, upon notice -

What organizations have sought but not yet received registration as hospital or medical benefit funds?


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

A list of organizations registered as hospital or medical benefit organizations under the National Health Act is published in the “Commonwealth Gazette” in January each year. Since the last list was published in January, 1958, the only application for registration received has been from the Yallourn Medical and Hospital Society. This application was for registration for hospital benefits purposes and has been granted. There are no applications by organizations for registration under the National Health Act which have not yet been dealt with.

Pharmaceutical Benefits Advisory Committee

Mr Whitlam:

m asked the Minister for Health, upon notice -

  1. Has he or his predecessor ever rejected a recommendation by the Pharmaceutical Benefits Advisory Committee or referred a recommendation back to the Committee for reconsideration?
  2. If so, on what occasions and in respect of what drugs has this action been taken?

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

  1. I have no knowledge of any recommendation of the Pharmaceutical Benefits Advisory Committee having been rejected or referred back to the committee for reconsideration.
  2. See 1 above.

Purchase of Aircraft

Mr Whitlam:

m asked the Minister representing the Minister for Civil Aviation, upon notice -

  1. Did Australian National Airways Proprietary Limited purchase two DC6 and four DC6B aircraft with loans guaranteed by the Commonwealth under the 1952 Civil Aviation Agreement?
  2. Does the Commonwealth hold security over these aircraft?
  3. Has the company sought the Commonwealth’s consent to sell these aircraft?
Mr Townley:

– The Minister for Civil Aviation has furnished the following replies: -

  1. Yes.
  2. Yes.
  3. No.

Airline Passenger Rates

Mr Bryant:

t asked the Minister representing the Minister for Civil Aviation, upon notice -

  1. What rates per mile are charged for first class passengers by airlines on internal routes in (a) Australia and (b) Papua and New Guinea, and (c) between Australia and overseas territories?
  2. Why is there a differentiation?
  3. Has consideration been given to equalizing these rates?
Mr Townley:

– The Minister for Civil Aviation has furnished the following reply: -

No uniform rate per mile is applied in fixing fares in any of the areas referred to. The question of the appropriate fare to apply to a route is a very involved one and must take into account many factors including the cost of operation, the traffic potential of the route, the type of aircraft to be employed, other competitive services either air or surface, the nature of the area to be served, and the revenue needs of the services so as to break even. Even so, it is not always possible to charge the fare which would be necessary for the airline to break even and hence the necessity for the Commonwealth to make payments in the nature of subsidy in respect of essential developmental air services. In the case of international services the fare structure of all services is fixed by I.A.T.A. subject to the right of Governments to disallow the fare so fixed. For all these reasons it is quite impracticable to establish a fare structure based on a uniform rate per mile.

Perth Airport

Mr Webb:

b asked the Minister representing the Minister for Civil Aviation, upon notice -

  1. Is a new terminal to be built at Perth Airport?
  2. If so, when it is likely to be commenced?
Mr Townley:

– The Minister for Civil Aviation has replied as follows: - 1 and I. The requirement for a permanent terminal building at Perth Airport is recognized but it is proposed to wait until more is known about the ways and means of handling large jet aircraft at airports before commencing to build it. The existing facilities will be quite satisfactory, with perhaps some minor alterations, for several years, and during this time the experience gained in handling large jet aircraft will be used in the design of the new terminal. The additional facilities which will be required at the airport to handle the traffic associated with the Empire Games in Perth in 1962, are being kept well in mind.

Australian Coastal Shipping

Mr Ward:

d asked the Minister representing the Minister for Shipping and Transport, upon notice -

  1. Is it a fact that the private shipping companies operating passenger services around the Australian coast intend to discontinue their operations?
  2. If so, when is this decision to become effective and what steps have been taken by the Government to meet the situation?
Mr Townley:

– The Minister for Shipping and Transport has advised as follows: -

  1. It was reported in the press on 28th June, that because of high replacement cost and other factors shipowners were watching closely the position in relation to replacement of coastal passenger vessels but no confirmation has been given of the statement that such vessels will not be replaced by their present owners.
  2. The Australian National Line has under construction at present a passenger ferry to replace “ Taroona “ in the Bass Strait trade when that vessel reaches the end of its economic life at the end of 1959. If shipowners are unable to replace other passenger vessels as they become uneconomic to operate, the Government will take appropriate measures to ensure that adequate services are available to persons desiring to travel interstate by sea.

Motor Cyclists’ Safety Helmets

Mr Webb:

b asked the Minister representing the Minister for Shipping and Transport, upon notice -

  1. Has the Australian Transport Advisory Council recommended that motor cyclists’ safety helmets be exempted from import restrictions?
  2. Has it been proved that safety helmets of an approved standard could considerably reduce motor cycle fatalities?
  3. Is it a fact that the helmet produced in Australia does not reach the desired standard?
  4. Has the Australian Road Safety Council been carrying out a campaign to popularize safety helmets; if so, is this being negated by the present restrictions?
  5. Will the Minister take action with the object of allowing approved safety helmets to be imported?
Mr Townley:

– The Minister for Shipping and Transport has furnished the following replies: -

  1. At its March, 1958, meeting the Australian Transport Advisory Council resolved that the Minister for Trade be asked to make specific and additional licences available until supplies are available from local production. Supplies of helmets considered suitable by the chairman of the Road Safety Council are now freely available on the Australian market.
  2. A substantial reduction in motor cycle fatalities and head injuries has been claimed to result from the use of safety helmets.
  3. At its March, 1958, meeting the Australian Transport Advisory Council resolved that the Standards Association of Australia be asked to adopt the British (2001 : 1953) or New Zealand (1215) specification or their equivalents as the Australian standard. This request has been under examination by a committee of the Standards Association but no Australian standard has yet been promulgated. There are helmets available in Australia which in the opinion of the chairman of the Australian Road Safety Council give protection to the user equivalent to that provided by the helmet made to the British Standard (2001 : 1953) specification.
  4. The Australian Road Safety Council has been carrying out a campaign to encourage the voluntary use of motor cycle safety helmets. As adequate supplies of the helmet referred to in (3) above are available in Australia the Road Safety Council campaign is not being negated by import restrictions.
  5. Information available to the chairman of the Australian Road Safety Council indicates that the present supply position of the helmets referred to in (3) above is adequate to meet local needs. In the circumstances, special action for the importation of safety helmets does not appear to be necessary.

Cite as: Australia, House of Representatives, Debates, 19 August 1958, viewed 22 October 2017, <>.