23rd Parliament · 1st Session
Mr. SPEAKER (Hon. John McLeay) took the chair at 10.30 a.m., and read prayers.
-I direct a question to the PostmasterGeneral. The matter to which I refer arises from the widespread extension of Port Adelaide business premises on to waste lands where, in the past, there has been no telephone communication at all. Various firms have built premises there, but they have been completely unsuccessful in their efforts to have the premises provided with telephones. Can the Minister take up with his department in South Australia the question of the extreme urgency of providing telephone communication for these business premises, and can he do something to reduce the long waiting time that is apparently necessary at present?
– I shall be glad to take up the matter referred to by the honorable member, and to see what can be done to expedite the installation of telephones in the area he refers to. May I be pardoned for saying, however, that very often a situation such as he has outlined develops, and criticism of the department follows, because it is not in a position to provide immediate telephone connexions to the new areas. This frequently occurs because it is only just before they are due to open their premises for business that the persons concerned contact the department to find out whether a telephone service will be available. In the case of other essential services, of course, this matter is looked into far in advance of the commencement of the building programme. I make this point because quite a few times people have said suddenly, in these circumstances, “ We need telephones; why can we not get them immediately?”
– I ask the Attorney General whether the position of Director of the Legal Service Bureau has been terminated because of the attainment of retiring age by the officer who has occupied this post. I ask the Minister whether this officer, Mr. Wilkins, has given distinguished service in the cause of rehabilitation of exservicemen. I ask also whether the extent and the efficiency of the work of the Legal Service Bureau will be maintained on behalf of ex-servicemen.
– It is true that, on the retirement of Mr. Wilkins, the office of director was terminated and has not been filled. It is right that I should say that Mr. Wilkins was an exceptionally good officer, that he was most attentive to the needs of ex-servicemen and their dependants, and that he did much to build up the Legal Service Bureau. However, on reviewing the whole set-up of the service, it was felt that there was no need to maintain the position, and that the termination of the office would not in any way impair the efficiency of the service being rendered by the several bureaux. Honorable members may understand that Mr. Wilkins, besides being officer in charge in New South Wales, exercised a general supervisory power over the bureaux in the other States. These bureaux have now been placed under the control of the Deputy Crown Solicitor in each State, and I myself am satisfied, because I looked into this matter before deciding that the office should be terminated, that the efficiency of the service will not be impaired. I have, of course, no intention at present of reducing in any way the area of operation of these bureaux.
– I ask the Attorney General a question supplementary to the question that he has just answered. Does his statement mean that there has been a reduction of the staff of the Legal Service Bureau? Is it a fact that the bureau still renders an important service without charge to returned servicemen, for instance in connexion with repatriation matters? Will the AttorneyGeneral intimate whether it is intended that the bureau should now be merely attached to the office of the Deputy Crown Solicitor instead of being a separate and quasiindependent department? The AttorneyGeneral will appreciate that this has a statutory significance.
– The termination of the post of director does not mean that there is any reduction of the total staff. The director was, of course, the officer in charge in New South Wales, and there is a person in that office. Mr. Wilkins, as I say, exercised some supervisory power over the bureaux in the other States, but it was felt that this service had developed to a point where that supervision was no longer necessary. The bureau will not lose any of its functions or any of its effective independence by being placed under the Deputy Crown Solicitor in each State. This merely means that such supervision as is necessary will now be exercised by the Deputy Crown Solicitor rather than by the director, who remained substantially in one State. I assure the right honorable gentleman that there is no intention to limit the nature of the service given, or the extent or the efficiency of it.
– Last week the Minister for Trade announced that the Government would contribute £10,000 to the Industrial Design Council of Australia. Will the Minister inform the House of the objects of the council and the purpose of the contribution?
– The Industrial Design Council of Australia was set up a little more than a year ago on the initiative of leading organizations and personalities in Australian industry and commerce. A very distinguished Australian, Mr. Essington Lewis, has accepted the chairmanship of the council. A similar organization exists in the United Kingdom. The purpose of the council is to service Australian industry over the whole range of design, including functional design, appearance design, and designs which facilitate economic production or contribute to enhanced selling qualities or to ease of handling a particular product. The council is setting up its headquarters in Melbourne and it will have branches in other capital cities at a later stage. It will assemble a library, will have exhibits, will, I believe, eventually have travelling exhibitions, and will provide a constant service to industry. All of this has been regarded by the Government as so valuable that it has made an initial contribution of £10,000, but this sum has already been exceeded, I understand, by contributions from private industry.
– I wish to ask a question of the Minister representing the Prime Minister, who in turn is representing the Treasurer, who in turn is representing his electorate by remote control. Is it true that within the last few days the Government has negotiated a loan with West Germany totalling £20,000,000? If so, will the Government consider Greenland on the next occasion as this is about the only country which this Government has not approached for a loan?
– I ask the Minister for Primary Industry whether the committee which has been appointed to inquire into the working of the dairy industry has yet commenced its work. Can he inform the House whether the committee is to inquire only into costs within the industry or whether it will probe the question of certain areas or properties which are not profitable, first because of lack of communication, secondly because of costs of transport, thirdly owing to lack of the necessary knowledge in regard to pasture improvement, fourthly because of the effect of land laws and generally because of systems of finance and the social conditions arising therefrom? Further, in view of the fact that much of the inquiry will be associated with northern New South Wales which, at one time, together with southern Queensland, was looked upon as the richest dairying country in Australia, will consideration be given to the appointment of an expert on agricultural economics, such as the Professor of Agricultural Economics at the University of New England, to assist in advising the committee?
– The committee of inquiry has commenced its work and has taken evidence in Victoria. I think the honorable member for Wannon has taken advantage of the opportunity to give his opinion, and I compliment him for doing that. This week the committee moves to Queensland, and will make a comprehensive survey because it will see conditions on several of the dairy farms in each of the districts. The terms of reference are in no way restricted, as the honorable member would know if he read them. They are all-embracing and designed to enable the committee to examine every aspect of the industry in order to discover the best way to make it economic and stable, and to make recommendations accordingly.
– Is the Minister for Trade aware that the United Kingdom Government issues a list of goods subject to embargo and that the last such list was published in the British Board of Trade journal on 15th August, 1958? Does the Australian Government consider that there are certain goods which, for strategic reasons, are subject to embargo? If so, why does not this Government issue a list similar to that issued by the United Kingdom Government?
– I have explained Government policy on this matter. If the honorable member wishes strategic items to be exported from Australia to Communist China he should make a specific request.
– Will the Minister for Labour and National Service comment upon the results of the recent Australian Council of Trade Unions elections? Will he comment also on the recent report that the Communists are making an all-out bid to control transport, light, power and housing in Victoria?
– I should not like to make any detailed comment upon the results of the A.C.T.U. elections. I think the one noteworthy fact is that at least one Communist was defeated in those elections, and I think that the House, and most Australians, will applaud this result. I would have thought, however, that there would have been a more resounding defeat of the Communists in view of what is happening on the Indian borders, and I should have expected the trade union movement to have inflicted a more thoroughgoing defeat upon the Communists. I would not place too much significance upon what has happened. The trade union movement controls its own destiny. The important thing is that the objective of the Communist Party within the trade union movement should be well known so that the trade union movement can take action to see that communism within the movement is defeated. I should like to add-
– They can look after themselves.
– The honorable member can support them if he wishes to do so. His attitude towards the Communists is well known.
– So is yours. You are a fascist.
– Mr. Speaker, I rise to order. It was quite audible to honorable members on this side of the House that the honorable member for East Sydney called the Minister a fascist. I ask that he withdraw his statement.
-The Minister will continue with his reply to the question.
– As for the last part of the honorable member’s question, it is well known that the objectives of the Communist Party are to obtain control of the transport unions and all other important unions concerned with the production of power and electricity. Again, this is a matter for the trade union movement itself. The important thing is that the facts and the dangers of both national and international communism should be known to the trade union movement.
– I direct my question to the Minister for Trade, or such other Minister within whose jurisdiction my question may come. I preface my question by stating that complaints are general amongst home owners, builders, farmers and other users of galvanized iron products that the application of zinc, which is a galvanizing process, to metal products is very light indeed, and that the life of these products is now not more than 25 per cent, of the life of similar products a quarter of a century ago. Will the Minister contact the National Standards Laboratory and other responsible authorities and urge that in future the application of zinc for galvanizing iron products be of such a generous nature as to ensure that they shall have a reasonable life?
– I acknowledge the importance of the point that the honorable member has raised. I have no personal knowledge that I can employ to answer his question, but I will undertake to make inquiries.
– I preface my question to the Postmaster-General by directing his attention to the fact that in 1936 his department issued a publication which contained Melbourne street names and the appropriate postal district numbers. This publication was valued greatly by the business community and by private individuals, and its use resulted in a considerable saving of time at the mail sorting section of the G.P.O., and also expedited the delivery of mail. As it is now 25 years since the publication was last issued, and as the suburban area of Melbourne has grown considerably in that time until it is now perhaps double its size in 1936, will the Postmaster-General consider the early issue of an up-to-date version of this publication?
– It is correct, as stated by the honorable member, that in 1936 a directory covering all the streets in the Melbourne metropolitan postal area, and outlining the various postal districts, was published. That publication was useful, not only for mail sorting purposes, but also as a method of enabling the public to address mail more specifically. Although the directory has not been reprinted, I understand that it has been kept up-to-date for departmental purposes at the G.P.O. in Melbourne. It has not been re-issued since its first printing. Because of the development of Melbourne, particularly in the suburban areas, to which the honorable member has referred, I understand that a survey is being conducted at present. Attention will be given to the honorable member’s suggestion that an up-to-date version of the publication be printed when that survey has been completed.
– Can the Acting Treasurer say whether the imposition of 25 per cent, sales tax on school requisites such as fountain pens is an aid to education, seeing that the same amount of sales tax is applied to fruit machines?
– I am not the Acting Treasurer, but I shall answer the question which, I think, is designed to be facetious. If the honorable member cares to frame his question in parliamentary form I shall endeavour to answer it.
– I rise to order, Mr. Speaker. Is the Minister for Trade entitled repeatedly to reflect on yourself, as the Speaker, when he says, in replying to a question, “ If the question is framed in parliamentary language “. I think that you, as the custodian of our procedures, are the judge as to whether any question is in parliamentary langauge, and I hope that you will not allow the Minister for Trade to continue in this way.
-Order! The right honorable the Minister for Trade is in order. I am, perhaps, just a little too tolerant regarding the questions that are asked, but it would not be in the interest of all concerned if I were to enforce the Standing Orders rigidly.
– I wish to address a question to the Deputy Prime Minister. Recently, it was apparent that the Government was considering proposals submitted to it for the construction of a governmentcontrolled or government-sponsored luxury hotel in Sydney as an ancillary of Qantas Empire Airways Limited. Has the right honorable gentleman noticed that this week the Sydney County Council has approved in principle the building of a £3,500,000 skyscraper hotel by a private company at Potts Point, Sydney? If private enterprise has now indicated its willingness to erect such buildings and provide additional services, is there any call for the Commonwealth Government to contemplate a further entry into the highly specialized and competitive field of what is colloquially called “ the pub business “ in which a firstclass commercial war is now being waged, with likely casualties?
– I assure the honorable member for Mitchell and the House that the Government’s policy is not that any of its instrumentalities should become engaged in the business of conducting hotels. The cold truth of the matter is that Qantas Empire Airways Limited, which is one of the world’s foremost international airlines, as part of its service, has had to be in a position to assure appropriate hotel accommodation in Sydney for its passengers. Such accommodation has been so scarce and its availability so unpredictable that Qantas was driven, some years ago, to secure Government permission to purchase the Wentworth Hotel. I do not think that any one has suggested that that was a wrong procedure. Recently, it has been publicly revealed that Qantas felt it necessary to request the Government to approve of Qantas, with the aid of outside capital, constructing a first-class hotel. The Government did not want Qantas to build a hotel unless this was shown to be necessary and the company, by direction of the Government, has been engaged in discussions with various interests which had indicated that they were thinking of building new hotels in Sydney. I speak from my own judgment when I say that if adequate hotel accommodation of appropriate quality were available Qantas would not be interested in building a hotel. If, on the other hand, only a neat amount of first-class hotel accommodation were available I think that Qantas would want a contractual arrangement to ensure that it had appropriate accommodation for its passengers. What the actual position is in regard to the proposed new building, I do not know. But I think that my remarks will explain to the honorable member sufficiently, perhaps, the general attitude of the Government on this matter.
– In the absence of the Prime Minister, I direct a question to the Minister for Trade which is supplementary to a question that was asked by the honorable member for Phillip on 12th May, and also to the question that has just been asked by the honorable member for Mitchell. Is it a fact that Qantas Empire Airways is most anxious to build a modern hotel in Sydney to cope with overseas traffic? Is it also a fact that because of pressure from back-bench members of the
Liberal Party, the Qantas proposal is being deferred until the Chevron organization completes an hotel at Potts Point?
– I can add nothing in reply to the honorable member to what I have said in reply to the honorable member for Mitchell.
– My question is directed to the Minister for Trade in the absence of the Prime Minister. Will the right honorable gentleman invite Cabinet to consider the provision of some form of concessional allowance, rebate or other relief to age and invalid pensioners on their telephone accounts?
– Mr. Speaker, I scarcely think it is in my province to give such an assurance as the honorable member has requested, but I will see to it that his question is brought to the notice of the Prime Minister.
– I preface a question to the Minister for Social Services by stating that on many occasions I have been approached by age and invalid pensioners who have received a bill for ambulance services for transport to hospital in emergency cases. Most of these people are unable to pay the bill, and usually the ambulance authorities wipe the charge. This, I think you will agree, Mr. Speaker, amounts to ambulance organizations subsidizing a cost which is really the responsibility of the Government. Will the honorable gentleman look into this matter with a view to rectifying this injustice to ambulance organizations?
– I appreciate the anxiety of the honorable member for Watson in addressing himself to questions of this sort. His anxiety is shared from time to time by other honorable members, but the facts of the matter are that the ambulance services are the exclusive responsibility of the States, and I regret to say that there are no resources available to me whereby I can assist in helping people to meet their ambulance costs. I have considered the matter, but it would not serve any useful purpose for the Commonwealth Government to intrude in another service which is exclusive to the States.
– Will the Minister for Health inform the House whether there are any legal doubts as to whether the Government’s proposals to charge a fee for medical prescriptions may be invalid under the Constitution?
– Mr. Speaker, I am aware that a statement has been made to the effect indicated by the honorable gentleman. The statement is based on surmise and not on fact, and rather incorrect surmise at that. It supposes that the author of the statement is in possession of detailed knowledge of the terms of amendments to the National Health Act which have yet to be introduced into this Parliament. He has not, and could not have, such knowledge. The statement is nonsense.
– My question without notice is directed to the Minister for Trade. May I preface the question, Mr. Speaker, by saying that I note that the New Zealand Government intends to establish a national consumers’ council and district consumers’ committees consisting of well-known citizens to protect the interest of consumers and to interpret consumers’ needs and views to producers of goods and services? In view of the many local complaints of gross exploitation of users of hire purchase and other loan and credit facilities, as well as complaints concerning injustices to small shareholders and the kind of complaint just made by the honorable member for Lalor will the Minister investigate the New Zealand proposal with a view to establishing similar bodies in Australia?
– I have no knowledge of the arrangements to which the honorable member refers, but I shall be glad to make some inquiries to inform myself as a preliminary to appropriate consideration. It appears to me, from some of the particulars given by the honorable gentleman, that the authority of State governments in this country might be involved, perhaps exclusively, if such a scheme were set on foot here. I do not know whether that would be the case, but it seems pretty clear that the authority of State governments would come into the picture.
– Will the Minister for Health say on what basis vaccine for smallpox vaccination is made available by the Commonwealth to a local authority desiring to carry out a campaign of vaccination? Who is properly responsible for the cost and the administration of such a campaign?
– In these circumstances the Commonwealth is rather in the position of the proprietors of a factory. The vaccine is manufactured, as it were, at the Commonwealth Serum Laboratories in Melbourne and, because the management of this particular factory happens to be a liberal and generous one, the vaccine is made available free to the consumer, who is required to pay only such freight costs as are incurred in conveying the vaccine from the Commonwealth Director of Health in the State concerned to the point at which it is to be used. How the campaign is conducted, and what use is made of the vaccine after that, are matters for arrangement by the local authorities concerned, and are no concern of the Commonwealth.
– I ask the Minister for the Interior: In view of the general policy and practice to maintain the garden aspect of Canberra by ensuring that all electricity cables, telephone service lines and the like are carried underground, with an absence of poles in the streets and on the house alignments, can the Minister say whether consideration has been given to the possible effect on the appearance of the city of the introduction of television services here? Has any restriction been placed on the height or design of television antennae? Would the Minister consult with his colleague, the PostmasterGeneral, as to the possible technical development of television services, in order to ascertain whether reception in this place might be obtained without external antennae?
– So far as I am aware no special consideration has been given to the problem raised by the honorable member. Nevertheless, I shall consult with the National Capital Development Commission and the Postmaster-General to see what can be done about the matter.
– I ask the Minister for Primary Industry: Is it a fact that the silos in New South Wales will be insufficient to handle the expected wheat crop this year, even after some extra silos now being built have been completed? Has an approach been made to the Commonwealth Government for additional finance for the building of more terminal silos? If so, what reply has been given to this request?
– A deputation representative of the Australian Wheat Board, the State bulk handling authorities, and of the Australian Wheatgrowers’ Federation met me on Tuesday of this week, and later to-day I shall make a statement on this matter covering the results of the deputation. In short, there is an overall storage capacity in Australia of 245,000,000 bushels. If this storage were in the right places it would be sufficient to meet all demands, but it is possible that the crop in New South Wales and Western Australia will exceed the storage available in those States. The Government has considered this matter on three occasions and has come to the conclusion that no national emergency exists, at least at present. The reply by the Government, through me, has been that no funds will be advanced towards providing extra storage for this season’s crop.
– My question to the Minister for Trade, in the absence of the Prime Minister, is supplementary to the question asked by the honorable member for Lalor, who sought information with regard to restrictive trade practices. I ask the right honorable gentleman whether he will discuss with the Government the urgent need to appoint a royal commission to make a searching inquiry into all aspects of restrictive trading practices in Australia. I ask him particularly to include in the scope of the inquiry wool marketing practices, the operations of the chemical, oil and shipping cartels, and the sale and manufacture of women’s shoes and stockings.
– I will convey the substance of the honorable member’s question to the Prime Minister.
– My question is addressed to the Deputy Prime Minister and the Minister for Trade. As Japanese competition is proving so valuable at our wool sales, and as Japan is quite a considerable purchaser of many of our primary products, is the right honorable gentleman aware that the Parliamentary Labour Party is pledged, by spoken word during an urgency debate, to rescind at the first opportunity the Japanese Trade Agreement, which makes this trading possible? As the agreement is of such value to our economy, will the right honorable gentleman endeavour to persuade the Leader of the Opposition to withdraw his opposition to it?
– I know that in this place on many occasions things are said in the heat of the moment or perhaps with an eye to immediate political advantage. But I cannot believe that the Parliamentary Labour Party would contemplate abrogating a trade agreement which has been of great advantage to Australia, which has done no harm to Australian industry-
– What rubbish! The Government has had protests from Australian industries.
– Order! The honorable member for East Sydney will remain silent or he will not have the opportunity to speak at all.
– The agreement has contributed immeasurably to enhancing goodwill and friendly relations between Australia and Japan. As the Leader of the Opposition is so insistent in his advocacy of the cause of peace and goodwill between nations, I cannot believe that he would be a party to cancelling such an agreement.
– I want to ask a question without notice of the Minister for Immigration. Can the honorable gentleman tell us the number of single women in Europe whom he visited, and to whom he spoke, who have accepted his invitation to join him in Australia, and can he state whether they are satisfied with their sojourn here? Will he state how many more he expects to accept the invitation?
– It is perfectly true that, within the bounds of propriety, I gave as pressing an invitation as possible to as many single women as possible in all the countries that I was able to visit in Europe. So far as I can tell, they seemed very responsive - not, of course, to my own blandishments, but to those of our country. I am sure that the honorable member, who is himself very interested in this subject, will be pleased to hear that I am very hopeful that as a result of my activities on the other side of the world there will be an unending flow of these very desirable migrants.
– My question is addressed to the Minister for Trade. I should like to say, by way of preface, that I was glad to hear, in answer to a question which I asked on Tuesday last, that the strengthening of the Tariff Board undertaken a year or so ago has achieved satisfactory results. I now ask the Minister whether, when the board is able to cope with them, he will refer to it for review the cases of industries which were granted tariff protection many years ago on the ground that they were infant industries, but which, by no conceivable stretch of the imagination, could now be so described.
– In reply to the honorable member, who has interested himself continually in these matters, I would say that the additional reference to the Tariff Board of a number of items of which I spoke when last answering him will not preclude the board from maintaining at a fairly reasonable tempo its investigations into the protective requirements of existing and well established Australian industries. The statute is quite clear in the entitlement that it affords to any Australian industry to ask for a review of its position. So I can say that I would regard the initiative as being not with the Government but with any industry which felt that its existing protective arrangements were inadequate or “warranted review by the Tariff Board.
– This is the other way, though.
– I do not know exactly what the honorable member has in mind there, but if it was felt in any particular case that the Government should make a reference to the board, the Government, of course, would be completely entitled to do so - and, on occasions, it does so. It depends on what evidence to warrant such an action is in the Government’s possession.
– I address my question to the Minister for Trade. Is the right honorable gentleman aware that the “ Board of Trade Journal “, which is published by Her Majesty’s Stationery Office, and which is available to the public in the United Kingdom, contains, in the issue of 15th August, 1958, a six-page list headed “Trade with the Soviet Bloc and China: Revised List of Goods Subject to Embargo “? First, does this indicate that Her Majesty’s Government in the United Kingdom has much more respect for the rights of individuals there to know the facts of government and such details as this than the Minister has for the rights of the people of Australia? Secondly, does the right honorable gentleman know that the list which I have mentioned contains a long item beginning with the words “ Metals in the form of angles, anodes, bars “, the first sub-item of which refers to alloy steels containing by weight 50 per cent, or more of iron or steel or various other metals? Is it a fact that Australia has exported £20,000,000 worth of this kind of steel to China in the last few years, and are not the Minister’s protestations that this steel is not used for strategic and defence purposes rather hypocritical, since it is obvious that, where commercial interests are involved, he is prepared to prejudice our defence?
– The Australian Government’s policy in this regard is not identical with that of the United Kingdom Government, and this is very well known. The Australian Government’s policy in regard to exports to mainland China is substantially more restrictive than is the policy of the United Kingdom Government. I would say, flat-footed, that there have been no exports to mainland China of items which are on a forbidden list in the United Kingdom. I would say, further, that there have not been £20,000,000 worth of exports in recent times of the items which the honorable member mentions to mainland China. What is quite clear from the constant questioning on this matter from the Opposition in this Parliament is that it has a political motive. I have no objection to that, but it is quite clear that it has a political motive. The Opposition will not come straight out and say whether it wants to facilitate the flow of strategic goods to mainland China or not. If that is their policy, let Opposition supporters stand up in their places and say so.
– In accordance with the provisions of the Public Works Committee Act 1913-1953, 1 bring up the report relating to the following work: -
Proposed construction of a Government Printing Office, at Canberra, Australian Capital Territory.
By way of a few words of explanation, I may say that anyone who looks even superficially at the present Government printery in Canberra will realize that it has outlived its usefulness, and that with the transfer of Government departments to Canberra and the increasing Government work load, there is clearly some urgency about the construction of a new printery. Several matters of great importance, both operative and financial, engaged the attention of the Public Works Committee. The modern industrial trend towards single floor operations in quite major industrial plants was one matter to which the committee gave a good deal of attention. In view of the fact that single floor plants are almost universally being constructed where there is no difficulty as far as site is concerned, and in view also of the improved work flow that can follow from single floor operation, the availability of natural light and so on, the committee decided to recommend in favour of a single floor structure.
As far as air-conditioning is concerned, this is becoming increasingly a “ must “ in modern industrial plants. The development of more modern techniques in printing plants, the steady movement towards offset printing processes and the need for paper conditioning laid more stress on the necessity for air-conditioning. In addition, of course, the committee gave consideration to the internal heat loads and the extremes of climatic conditions experienced in Canberra, which also make air-conditioning, as a contributing factor towards efficiency, a necessity.
The committee was very concerned with this question of air-conditioning, in view of the proportion of total cost of the project that is represented by air-conditioning plant. But the great weight of evidence favoured air-conditioning generally, and the committee has approved and recommended it. At the same time, the committee is proceeding with a more detailed study of airconditioning, the methods of providing it, the relative merits of various plants and the costs involved. The conclusions arrived at from this study, will, of course, be reflected in the committee’s considerations of future projects.
Similar problems, but of not such great magnitude, arose on the question of day lighting. Having regard to the need for adequate lighting in printing plants, particularly where high quality printing work is being done, once again the committee accepted a recommendation for day lighting.
All in all, there is a very great interdependence of these questions of single floor operation, day lighting, work flow, clear floor areas and so on. The committee has made a thorough review of the needs of modern printing work, both in Australia and abroad, and now presents a report for the acceptance of the House, confident that the building which will result from an acceptance of its recommendations will produce a printery of high capacity and high efficiency which will meet all of to-day’s requirements with regard tomodern industrial conditions.
– May I just say that I hope the Parliament will be seised of the importance of the committee’s recommendation for urgency in the commencement of this work. I listened attentively to the honorable member for Paterson, but I did not hear any mention of a commencing date for this project. I hope it will be put in hand without delay.
Ordered to be printed.
Motion (by Mr. Davidson) agreed to -
That the House, at its rising, adjourn until Tuesday, 15th September, at 2.30 p.m.
Motion (by Mr. Roberton) agreed to -
That leave be given to bring in a bill for an act to amend the Social Services Act 1947-1958.
Debate resumed from 2nd September (vide page 831), on motion by Sir Garfield Barwick -
That the bill be now read a second time.
– This bill was introduced last evening by the Attorney-General (Sir Garfield Barwick). The issue that is raised by the legislation is, of course, of importance. Although the proposed amendment of the Loans Securities Act is long and apparently involved, the substance of it is, I think, reasonably clear. Clause 3 of the bill provides -
Where, by the terms or conditions upon which any stock or security has been issued by or on behalf of the Commonwealth outside Australia (whether before or after the commencement of this section and whether under this Act or otherwise), the Commonwealth has given an undertaking, howsoever expressed, to the effect that the stock or security, or the principal or interest monies payable under the stock or security, will be exempt from, free of, or not subject to, taxes imposed in the Commonwealth except where the stock or security is the property of a person included in a particular class of persons consisting of or including all residents of Australia . . .
That is the situation that the clause looks at. There has been an undertaking by the Commonwealth, expressed in different ways, to the effect that the Commonwealth stock or security issued to the lender is to be free of Commonwealth taxes. Other phrases are used, because it is a provision that can be paraphrased, and it often has been. The exception, of course, is where the stock or security is the property of an Australian, in which case the ordinary law applies.
This legislation looks towards giving the overseas lender something which is rather special and very important in the lending transaction. What is given to him is this:
Notwithstanding any Australian law, Commonwealth or State, the principal and interest secured by the stock are not subject to any tax or duty under any such law, and are disregarded in the calculation of a tax which would normally include the whole or portion of such moneys. The actual provisions which reinforce that make it clear that the foreign lender to the Australian Government, relying upon the promise of the Australian Government in the security that it is to be exempt from Australian taxes, is not to be liable to pay estate duty, inheritance duty, or gift duty. Those are important considerations. They seem to me to be summed up in the proposition that a promise given by the Commonwealth Government that the principal and interest, which are the moneys derived by the lender from the Australian Government, will be free of tax, means what it says. It means that the money is not to be taxed either directly or indirectly in the form of estate duty, gift duty or any other impost. There is to be an exemption which the lender can claim. As the Attorney-General pointed out, the promise of exemption from taxes has been a provision in all loans raised abroad since 1921; all bond-holders who are not resident in Australia have received this assurance. The promise that the principal and interest on bonds will be free of taxes must include income tax, estate duty, gift duty and so on.
The question for the House to decide is whether it is desirable to make perfectly clear what the promise given in relation to each overseas loan means. Such a promise is contained in the terms of the loan now current, which, I understand, is being partially raised on the New York stock exchange. Every promise made by the Government is binding on the people. The whole position may be summed up by saying that if a promise has been made it must be honoured, and if there is a doubt as to the terms of the promise, it is the duty of the Parliament to eliminate it. The legislation, as a matter of reasoning, speaks for itself and we do not wish to oppose it
But that brings me to the second part of the problem. The Parliament must decide the extent to which overseas borrowing and the creation of these special securities should be continued in the future. Should this be entirely within the discretion of the executive Government, which is the position to-day, or should this Parliament authorize these loan transactions which, in many instances, gravely affect our financial position for good’ or for ill?’ I hold the view that the Parliament should pronounce on whether securities, are to be issued. The decision should’ not be one for the executive Government, sometimes in the form of the Governor-General; without Parliament being consulted. I do not propose to deal with this problem in detail now, but I shall give the House some idea of the extent of overseas borrowing. An answer to a question asked by the honorable member- for Scullin-, which appears in “ Hansard “ of 26th’ February last at page- 404; gives the details, of a. series of overseas borrowings-. One source, of course,, is the International Bank, for Reconstruction and. Development. These loans are in: a special category and they come before-, the Parliament. From 1554’ to 1958, eight, separate loans totalling 171,000;000 dollars were raised on- the New York, market. London loans amount to £60,000,000, Swiss loans to 120,000;000 Swiss francs, and a> Canadian loan to 1-5S00G,000 dollars.
Whatever merits these loans may have, they certainly have demerits in our opinion. As a party, we do not look with favour on overseas borrowing and our general approach is one of criticism and hostility. We feel that only in special circumstances - some- go further and say only in very special circumstances - is overseas borrowing permissible,, and. this, depends on factors such as. the economic position. However, the Parliament has. no say- in. the matter; the Government decides whether moneywill be raised, abroad, and;, incidentally, uses its discretion in fixing the. rate of interest and other terms of the loan. These are great and significant transactions. They are very important to the economy of Australia and we propose at a later stage to seek to have the law amended so that the Parliament and- not the executive Government will decide whether overseas borrowing should- be undertaken. If that is done, there- will be some check on the extent of the borrowing, and there should be a check. Some feel that consent to an overseas loan should be given only in the most special circumstances. I do not propose to deal with, the merits of each transaction, but it seems- to me to be completely, wrong that the executive Government, on its own discretion, should be free to enter into these vital transactions without the Parliament having the right to consider them, to revise them and to discuss the rate of inerest, the terms and the amount of them. All thos-, are vital matters.
They. are. the two- points that I wish to mention. First, it is quite clear that the promise to pay the principal- and interest free of taxes would include the matters that are mentioned in the bil). We accept that proposition. I think, it is. the accepted view internationally.. The promise to pay this money free of taxes is not limited merely to paying interest when the coupons are presented on the due. date. It is just as much a reduction of that interest to tax the bond-holder in other ways, including estate duty and gift duty. All these taxes really amount to the same thing, The second question is one about which Opposition members feel very keenly and concerns the valdity of overseas loan transactions, the extent and terms on which they should be permitted, if they are permitted at all, and, more importantly, the right of- the Parliament to decide in the circumstances of the times whether they should, be undertaken and whether special obligations and embargoes should be placed on a. government which, in our view, has borrowed far too much- on the overseas markets. The answer to the question, to which I have referred the House clearly shows that too much has been borrowed abroad.
.- The Leader of the Opposition (Dr. Evatt) Kas made- two substantial points. First, he says that what this bill does is to honour beyond question a. promise made by the Australian Government, and he finds no fault with the Government asking the Parliament to put the terms of the promise beyond doubt. I am sure that no- disagreement, with that point of view will come from any part of the; House. If the terms of overseas loans have included an undertaking that they will be free from taxation, no doubt we have found that this provision makes it easier to induce persons overseas to subscribe to the loans and, presumably, we have been able to offer a lower rate of interest in return- for that concession. In other words,, this is- a business proposition!
We do better by freeing these loans from Australian taxes. We do better in getting people to subscribe and we enjoy better interest rates than we would if we did not offer that concession. So, it is a business proposition.
Secondly, the Leader of the Opposition suggests that before a loan is negotiated overseas the Parliament should be always obliged to express its opinion on the matter. There may be some merit in that, but I believe that the Opposition has had many opportunities, of which it has availed itself, of expressing its views on the Government’s policy of borrowing abroad. It is not as though honorable members opposite had no other opportunities or had never taken them. Indeed, I think we all know very well the attitude of the Opposition on these matters. I do not believe that the bringing before Parliament of a proposal to borrow overseas in a particular case would enable the Opposition to express its views any more clearly than it has done already on innumerable occasions.
The particular purpose of this bill is well understood and agreed upon by members of the Opposition as well as by members on this side of the House. The real question that is raised is whether we should attempt to borrow as much overseas in the future as we have done in the past. That is the matter upon which most of the debate will ensue. If, from our own savings in this country, we could develop as rapidly as we need to do - and as, I think all honorable members will agree that we need to do - then I would be one who would believe that it would be well that we should not borrow abroad to the extent that we have. But the fact is that at the present time we are using from 25 per cent, to 30 per cent, of the national income for developmental purposes by way of investment, whether by governments or by private enterprise. That proportion of the national income is equal to and indeed greater than the proportion set aside by almost any other country for this purpose, with the possible exception of Canada. What scope, therefore, remains for us to increase our savings and invest them in this country for the purpose of development? 1 believe that very little scope indeed exists. That being so, we have had to turn abroad for the savings that we cannot increase beyond the present figure in our own country.
Does the Opposition really believe that we should not increase these savings from the only source where they are available, that is from overseas? I should like members of the Opposition to express their opinion on that matter and say how they think we could increase our savings in this country to do the things that ought to be done or, alternatively, say whether we should not do a number of things necessary if our population is to increase as rapidly as most of us think it should.
If we are going to borrow overseas or bring in capital from overseas, it can be done in two ways. Governments can borrow by way of public loans, or private concerns overseas can be induced to invest their money in equity capital in this country. So far as equity capital is concerned all sorts of dangers could arise, such as the strain upon our overseas funds in paying interest or the possible repatriating of that capital at some unpredictable stage. Perhaps what is even more important is that overseas concerns whose interests may not always be identical with ours may gain too great a control over the industrial affairs of Australia.
As to the two ways I have mentioned of bringing capital into Australia, Jj would suppose that the less objectionable of the two would be borrowing by way of Government loans. That is the matter with which this bill is concerned and we have to consider the raising of loans in overseas markets for the purposes of the Government in this country.
I am afraid that this debate has taken place without very much notice and my only regret is that I have not been able to study more deeply the extent of overseas borrowings and their implications. However, I offer these somewhat superficial observations, made at short notice, upon this proposal.
– The main purpose of this bill is to remedy a technical defect in the Loans Securities Act, a piece of legislation which has been in operation since 1919, presumably f ora the time that loans were floated by the Commonwealth of Australia. Apparently it had been envisaged prior to the passage of this proposed legislation that when the Commonwealth, in respect pf certain securities that it issued abroad, wrote upon them that they were free of any Commonwealth taxes present and future, it meant all taxes levied by the Commonwealth. It seems that as a result of one part of the double taxation agreement between the United States of America and Australia which became operative from 1953, the exchange of certain information now takes place between the taxation authorities of Australia and those of the United States of America. When it comes to the knowledge of the taxation authorities in America that persons in that country possess assets which technically are domiciled in Australia they notify the Commissioner of Taxation here accordingly. Presumably in return, when the Commissioner of Taxation finds from the fields of information open to him that residents of Australia hold assets domiciled in the United States of America, he accordingly notifies the taxation authorities in that country.
Apparently, as a result of the exchange of that kind of information, one or two assessments for estate, probate or gift duty, or whatever it might be, were levied by the Commissioner of Taxation in Australia upon people resident in America. They were really in respect of the equity in bonds such as we are now talking about. It seems that in the past the Commonwealth Treasurer of the day waived such assessments because he believed that to impose such a tax would be a breach of the promise made when those bonds were issued. It now appears that the purpose of this measure is to make the position clear beyond any doubt with respect to all taxes as, apparently at the moment, it applies to only some taxes. This has resulted from a deficiency being discovered in respect of certain individual bondholders who died in the United States of America. If they had been corporate or business owners of these bonds this deficiency would never have come to the notice of the Commissioner of Taxation.
This discovery would seem to indicate certain deficiencies so far as Australia is concerned with respect to knowing precisely what property in this country is owned by people residing in the United States of America or in any other country. There may be some gaps in the information that the United States authorities can obtain from residents of America who have assets in another country. It may well be that what has been discovered in Australia may prompt the Treasury to endeavour to do better than it has been doing with regard to the ownership by foreigners, let us call them, of assets that actually are domiciled in Australia.
There is a singular lack of accurate information on how much property in Australia is, in fact, legally owned by people outside Australia. That is a very serious deficiency. It is true that one can obtain rough estimates of what purports to be foreign investment in Australia. The Department of Trade has published quite a number of voluminous documents which purport to indicate the amount of United States investment in Australia, the amount of Canadian investment in Australia, and the amount of United Kingdom investment in Australia, but they do not detail precisely in any significant form the location of the assets and the nature of the ownership. In fact, one can obtain from American sources more substantial information about American investment in Australia than one can obtain from Australian sources. In the United States there is a publication known as the “ Survey of Current Business “. The August or September issue of that monthly publication contained details of the amount invested by American undertakings in foreign areas. The details are listed for particular countries and for particular groups of countries, and indicate the nature of the investment, whether it is in manufacturing industries, whether it is in commerce, or whether it is in finance. To my knowledge very little information of that kind is published by Australian sources.
It is true that one can obtain a rough idea of the position from figures that are published by the Commonwealth Statistician, but very little attempt has been made to detail and to plot, as it were, the degree of foreign holding of assets in Australia. The motor car industry is a good example of the ownership of assets in Australia by overseas undertakings. Possibly far more than half of the ownership of the motor car industry in this country resides, not with Australians, but with American and British firms. Australians hold very little equity in what are highly significant areas of the Australian economy. This makes it increasingly difficult to control the investments. As the honorable member for Bradfield (Mr. Turner) has indicated, and as all honorable members realize, there must be .a .proper balance of investment as between public investment on the one hand, and a proper balance in private investment to avoid over-development in some aspects and under-development in others.
On this question of foreign investment - particularly private foreign investment - in Australia, the Labour Party believes that very little attention has been given to the precise fields in which that investment has been made. However, the Government seems to be concerned only with the overall balance of payments at the end of the year. This policy is being followed in regard to the loan that is now being negotiated on the New York market. The Labour Party believes that there is no need to raise that loan at all. In theory, the Government purports to use the loan to assist the States in their loan raising programme, but in actual fact it will be used to assist the Government out of certain difficulties that have been caused by its own mismanagement of the Australian finances.
When the proposed loan of 25,000,000 dollars is raised overseas, the direct equivalent of that amount in Australian currency, something in the region of £12,000,000, will be paid into the National Debt Sinking Fund. During the year that £12,000,000 will appear as money available for loan raising in Australia. The real position will be camouflaged. The loan will not be earmarked particularly for investment in equipment that is necessary to carry out our public works programme because, when one analyses the public works programme at the end of each year, one finds that the greatest component in the work that has been done - in postal facilities, schools, houses, the Snowy Mountains scheme - is labour, and the majority of the remaining components is materials that are readily available in this country.
– Order! I think that the honorable gentleman is going a little wide of the subject of this debate.
– I am simply endeavouring to show that the proposed amendment is an attempt to validate certain words -that will be written on bonds which will be issued in New York within the next fourteen days. Those bonds purport to assist the Australian loan programme. It seems very difficult, Mr. Deputy Speaker, to argue-
– Order! The Chair will permit a discussion on matters relevant to the subject, but not on matters that are too far away from the subject.
– Very well. The other matter to which I had referred before you assumed the chair, Mr. Deputy Speaker, related to the disclosure of foreign assets. This legislation is an attempt to eliminate the difficulty arising out of the assessment of probate following the disclosure of foreign assets. I think that the AttorneyGeneral (Sir Garfield Barwick) indicated that in his speech the other evening. It had been believed, until then, that these bonds were free of tax. Apparently, nobody had contemplated that in some circumstances they would become liable to estate and probate duties. Apparently, before the double tax agreement in 1953, it is doubtful whether the existence of the assets would have been disclosed to the Australian taxing authorities. It seems to me to indicate, at least, some deficiency in our records with respect to the ownership of assets in Australia by people outside.
The question that we are discussing is part and parcel, as it were, of the whole of that structure. We offer no objection to the technicality that is envisaged here, The Australian Government made a promise. It believed, when the promise was made, that all taxes, including estate duty and probate duty, were covered. Apparently, if estate duty and probate duty are not covered there is an invidious distinction between those bond-holders who are corporate investors and those who are individual investors. That ought to be removed.
The Labour Party has foreshadowed that, in the committee stage of this debate, it will move an amendment that will make it essential, in future, to disclose to this House of Parliament the raising of a foreign loan. With respect to the loan that we are discussing at the moment we have no information other than that it is an aggregate sum of 25,000,000 dollars. We do not know the rate of interest that the bonds will bear, nor whether the bonds are to be issued at a discount or at a premium. We do not know what promises are to be made to the underwriting firm that will handle the operation. We can at least be certain that whilst Australia will have to pay interest on 25,000,000 dollars for the term of the loan, we possibly will be lucky to get as much as 24,000,000 dollars by the time the discount and the underwriting fees are taken into account.
The details which have come to this House of overseas loans have indicated that, despite the inducement of being free of tax, they were issued at a substantial discount. Some of them, I think, were issued at as low as £97 10s. per cent, or £98 per cent. The rate of interest was in the region of 4 per cent, flat, and the effective rate was about 4i per cent., free of tax, to those people who invested in the loans. That kind of information is not available to the Parliament in advance of the loan. This thing is simply done by executive act and it seems to us to indicate a gross deficiency. In future budgets, we will be expected to pay interest on these amounts and we shall have to repay the capital amount borrowed. Yet we are given no details of the loans and we are not even asked to sanction them.
This type of loan is distinctly different from the loans raised through the International Bank for Reconstruction and Development. Apparently, under the terms of that institution, a loan has ultimately to receive the ratification of the Parliament itself. I suggest that that is a sound rule to be followed in all foreign borrowing. The Government should disclose the terms of each loan to Parliament before final ratification.
If we had had the opportunity to debate whether or not this 25,000,000 dollars should be raised, the Opposition would have opposed that proposal categorically because, for the ostensible purposes of the State loan programmes, it is not necessary to raise money outside Australia. We have taken what opportunity we have had within the terms of the Standing Orders to indicate our objections to the indiscriminate foreign borrowing that has been indulged in by this Government merely to balance its accounts at the end of the financial year. The Government seems to be gratified at the end of the financial year when it can say that its London funds have fallen by only £2,500,000, or have risen by £2,500,000 - camouflaging the very real fact that the indebtedness of Australia to people outside Australia has risen, on an average, by about £150,000,000 in each year that this Government has been in office. That is just another indication of the very heavy price that the ordinary people of Australia have to pay for the extravagance and mismanagement of this Government.
.- Mr. Speaker, this bill is only a small machinery measure to rectify the anomaly which has crept in, due to our recent tax agreement with the United States of America. No one in this House would suggest, I presume, that Australia should endeavour in any way to levy tax on bonds held by bondholders resident in other countries who have taken up Australian loans raised on overseas markets. Although this measure is not opposed, I presume, by any section of this House, the debate on it has roamed far and wide. The honorable member for Melbourne Ports (Mr. Crean) dealt with the ownership of assets in Australia, the question of whether the Commonwealth Statistician collected enough information, and so forth. Once again, the wisdom of our borrowing programme overseas has been questioned - also the machinery of approval.
If one thing is absolutely clear it is that when any government goes on to a market for a loan, it cannot know the terms of that loan beforehand. If there were any doubt as to whether a government had power to float a loan or whether the loan would be approved by Parliament nobody would subscribe to it. It would be completely impossible to raise money on that basis. Nor would it be possible to put to Parliament the exact terms and conditions of each loan. These are not even known until the day before the loan is floated. Even with the Australian Loan Council procedure a lot of difficulty arises from the point of view of the people who have to conduct the operation, in getting the necessary approval.
The real functionary in this regard is, of course, the Loan Council which is an aggregation of governments, not just the Commonwealth Government. The Commonwealth Government, in borrowing overseas, is, in essence, the agent of the Loan Council. It is notable that whatever honorable gentlemen opposite may say in this House about the wisdom of borrowing overseas, Labour governments in the States which are faced with the practical responsibility of finding enough resources to carry on their programmes regularly and systematically, approve of these operations.
It is true, as the honorable member for Melbourne Ports has said, that most of the projects carried out by the State governments are kept going out of Australia’s own resources and do not themselves directly require imports. But the demands which they set up in the country have to be met by imports. If the development programme for which this Government is responsible were slowed down we could do without these foreign loans. But what we need is a faster rate of development than would be possible without overseas loans. These loans bring to Australia real resources which otherwise would not be available and, without them, the demand set up by our development programmes would result in very considerable inflation and in eventual frustration. By one means or another, physically, development in Australia would be slowed down but for these loans. In opposing the raising of funds abroad the Opposition, in effect, is saying that Australian development should be cut back and slowed down.
It was our unfortunate experience in the early 1930’s suddenly to find ourselves confronted with a bigger interest bill than our circumstances could sustain. In considering the reaction of the Labour Party to that situation, it must not be overlooked that all the extra development which took place in Australia throughout the 1920’s would not have been possible without the overseas borrowing programme. Every time we borrow abroad we set up a liability for paying interest in the future. Every business undertaking which borrows from a bank is in a similar position, but in borrowing from a bank the assets of the firm concerned normally are increased, and its capacity to pay is enhanced over a period. So it is with these foreign borrowing operations. In the process, we do develop the Australian economy at a faster rate. It does not follow in the case of a particular loan that the proceeds necessarily directly and immediately add to the overseas income from which we will subsequently have to meet interest payments. But it does other things. It allows a more rapid development to take place. It enables industries to be established which in turn, even if they do not export directly, do replace imports and place the whole of the Australian life on a larger scale.
– Order! The honorable gentleman is rather developing a general debate and departing, slightly at least, from the subject-matter of the bill.
– I do so, Mr. Deputy Speaker, only because these are points which have been raised in the debate. I agree with you entirely that this is irrelevant to the particular bill before the House, but irrelevancy has already occurred and the temptation to reply is somewhat overwhelming.
– Order! The Chair will allow a slight deviation.
– I support this bill. There is no doubt that our borrowing programme will continue, that Australia’s development will not be slowed down, and that the people who, by one means or another, really are endeavouring to retard the pace of development in Australia and endeavouring indirectly to slow it down, will not, in practice, find themselves in office.
.- At least the fact that the Government finds itself in some difficulty over this matter and is obliged to treat it as a matter of urgency gives the House an opportunity to engage in a very interesting debate on the question of overseas borrowing. I do not know whether the difficulty arises from another example of bungling on the part of the Government, but it appears to me that it created the difficulty by its own act. The debate should be divided because I think there would be very few who would not agree that where an undertaking had been given, the promise should be fulfilled. That was made clear by the Leader of the
Opposition (Dr. Evatt). But as to whether there should be a continuance of borrowing under the conditions applying to this particular loan is a horse of a different colour.
It is perfectly true that the Australian Labour Party’s attitude to overseas borrowing has been made quite clear and is well known to the Australian community. We believe there should be overseas borrowing only when it is absolutely certain that it cannot be avoided. If material or equipment are required to carry out developmental works and they cannot be procured in Australia, we would approve an overseas loan, but only under those conditions. In my opinion, the Government’s attitude to this legislation is completely dishonest, because in declaring this a matter of urgency it was said, on behalf of the Government -
The proceeds of this loan will be used for the borrowing programme of £220,000,000 approved by the Australian Loan Council for 1959-60.
That is completely dishonest, as I hope to show. Continuously in this type of debate supporters of the Government have tried to ensure that there is no opposition or criticism from the Labour Party. They say, “ If you oppose this loan and the intention to borrow, you will hold up State works. You will hold up the development of Australia “. Nothing could be further from the truth.
– Order! The honorable member could not get much further from the bill, either. He should direct his remarks to the bill.
– I do not want to challenge your ruling, Mr. Deputy Speaker, but with all due respect to the Chair, I point out that the main purpose of this legislation is to facilitate the raising of a 25,000,000 dollar loan in New York. Therefore, I am entitled to show that this policy of borrowing should no longer be continued. That is entirely relevant to the legislation before the House.
– Order! The Chair thinks differently.
– It is a pity you did not think the same way, Mr. Deputy Speaker, when other honorable members were speaking.
– Order! If the honorable gentleman creates difficul’ ties, he will be asked to resume his seat.
– Am I permitted to reply to the honorable member for Wentworth (Mr. Bury)?
– Order! The Chair will permit a slight deviation from matters related to the bill under discussion, but will not permit a full departure from the bill.
– In trying to extricate the Government from its difficulty over the use of the argument that this loan was being required for State works, the honorable member for Wentworth admitted in reply to the arguments used by the honorable member for Melbourne Ports (Mr. Crean) that the State works involved in this programme of £220,000,000 might not necessarily mean that we have to import materials and equipment from overseas; but he said that certain discrepancies or shortages would be created and we must have further imports to make up those shortages. Even that is a fallacious argument. I ask supporters of the Government who take part in this debate to indicate what material and equipment is required by the States under the loans programme that cannot be secured in Australia. What do State works consist of? They include the building of roads, hospitals and schools and all such things as we require in our everyday life. All the materials and equipment for these great projects undertaken by State governments under the works programme are readily available in Australia and we do not require international loans to provide them.
The honorable member for Wentworth should be thanked for throwing some enlightenment on the way overseas loans are organized and arranged. He said that the Government cannot know the terms of a loan beforehand. That is his own statement. He said it is not known until the day before a loan is floated what the terms are to be. What an extraordinary situation. Even the Government does not know until the day before the loan is to be put on the market what the terms and conditions will be. That was stated by the honorable member for Wentworth. He said that the
Commonwealth Government acts as an agent for the Australian Loan Council and the States, and that the States continually approve this process. I seriously doubt whether that is the position. What the States are concerned about when the Loan Council meets is getting sufficient finance to carry out their works programme. Naturally, it does not become a matter for discussion at the Loan Council meeting beyond the point of determining the level of advances to be made to the States. I repeat that whether this loan is secured or not will have no effect despite what the honorable member for Wentworth has said upon the development of Australia.
Let me turn to another aspect. As I have said, the Australian Labour Party is opposed to overseas borrowings. During the term of office of the Curtin and Chifley Labour Governments, we decreased our overseas indebtedness to the extent of approximately £100,000,000. I believe that the only reason why the Government requires all the overseas loans it can obtain is not for the purpose of development but to finance trade deficits. Let us consider the position last year which was said by the Treasurer (Mr. Harold Holt) to be a good year. What was the position? Our export’ income exceeded the amount of money we were required to pay for our imports by £16,000,000. That is in terms of the value of exports in financial terms measured against the cost of imports. But there was £203,000,000 to be made up by what are called invisible cost items such as insurance, freights and so on. In fact, our actual trade- position at the end of the last financial year was £187,000,000 on the wrong side.
– Order! I think that the honorable member is determined to make this a general debate and thereby defy the Chair.
– I am not defying the Chair.
– Then get back to the bill.
– Very well. In his secondreading speech on this bill the AttorneyGeneral made a statement which shows that the Government intends to raise a loan of another 25,000,000 dollars overseas. I say that that 25,000,000 dollars is not required for the development of this country, nor for the importation of needed and locally unprocurable materials and goods, but is intended to finance trading deficits, just as last year the Government raised overseas loans for the same purpose. I pointed out in my speech on the Budget that the Government is a “ borrow or bust “ government. Its members and supporters talk about the prosperity they have created. As a matter of fact, any individual can live beyond his means if he can get people v/ho will continually lend him money, just as a nation can live beyond its means in that way. But a day of reckoning has to come. This Government has built up a reputation for scraping the bottom of the barrel, for going wherever it can in order to get loans. To-day an honorable member asked a question which indicated that the Government is seeking a loan from West Germany. The Government does not care what paltry amount it gets. It is out to get the maximum from overseas for the purpose of financing its trade deficit.
Let me turn to another aspect of this question. The higher our overseas indebtedness goes, the more we create for ourselves political difficulties in regard to the control of our own industries, and we likewise build up economic difficulties for the future. Dr. Coombs directed attention to this particular matter. Dr. Coombs says that there is a- political consideration- as to who is to control’ our industries, and whether we want our industries to be controlled and owned by foreign investors. To give an. illustration of what, can happen I need only mention that not so long ago a decision was made by the American shareholders in the Mount Isa mine that production in this great Australian industry was to be curtailed. This is becoming a very serious matter for Australia. When I asked the Prime Minister if this did not mean a sacrifice of national sovereignty he said that that was absurd. But is it not a fact that the decision in respect to the Mount Isa mines was made outside this country, without consultation with the Government or with any other Australian authority?
One rather interesting development which can occur in respect of this proposed 25,000,000 dollar loan that the Government is now negotiating in the United States is that in Australia we have a rapid accumulation of profits earned by foreign investors in this country. At the moment I do not know the exact figure, but it amounts to many millions of pounds, because not all the profits earned by foreign investors in this country are taken out of Australia in the form of dividends to the country in which the foreign investors reside. So these profits build up in Australia. The volume of undistributed profits made by foreign investors in this country is already very great. What can happen with the manipulation of international finance in a case like this? General MotorsHolden’s Limited has accumulated many millions of pounds of undistributed profits in this country. As a result of the manipulation of international finance we might find ourselves in a position where G.M.H. could become the holders of this 25,000,000 dollars security in the United States, by transferring some of its undistributed profits. That would mean that on that proportion of its undistributed profits G.M.H. would not be liable to pay any tax in this country.
– May I suggest Mr. Deputy Speaker, that the honorable member for East Sydney is much further away from the bill than I was when I was called to order.
– The Chair is of the opinion that the honorable member has never got near the bill, and the Chair is trying to keep him in order. I want to make it clear that the main purpose of this bill, as the Leader of the Opposition acknowledged, is the exemption from taxation of certain securities issued abroad. I mentioned that the Chair would allow some discussion on matters immediately relevant to that, but would not allow honorable members to engage in a general debate as the honorable member is trying to do. He may think he has very successfully evaded the ruling of the Chair, but he has not. I ask the honorable member for East Sydney now to confine his remarks to matters immediately relevant to the bill.
– I rise to order, Mr. Deputy Speaker. An honorable member who is speaking in the House on the second-read ing of the bill is entitled to cover the speech of the Minister who introduced the bill. If you read the typewritten copy of the Minister’s speech which was issued to honorable members you will find, Mr. Deputy Speaker, that there is a reference on page 2 to the object of the present legislation as being the facilitation of the raising of a further 25,000,000 dollar loan on the New York market. On page 3 of the typewritten copy it is stated -
The proceeds of this loan will be used for the borrowing programme of £220,000,000 approved by the Australian Loan Council for 1959-60.
– The honorable member for East Sydney has already dealt with that, and he understands perfectly what the Chair has ruled.
– The point I want to raise is that I think a member is entitled to make his speech in his own way and say why he thinks that the proposed loan mentioned in the Minister’s speech should not be raised, and deal with the effect its raising is likely to have on the economy and on the future of Australia. I think that all those things are relevant.
– The Chair will decide what is relevant and what is not relevant. I give fair latitude to every honorable member, but if there is an attempt to defy the ruling of the Chair the Chair will have to take action.
– I again refer to the political consequences of the continuance of this Government’s policy of borrowing overseas. Earlier I referred to a statement made by Dr. Coombs, who is one of the advisors of the Government and was one of the financial advisors of the preceding government, to give the members of this chamber an opportunity to judge whether this policy of borrowing wherever we can get loans overseas should be continued. I again quote Dr. Coombs. Dr. Coombs said that in 1949 - the year the Labour Government left office - the meeting of overseas commitments represented 4i per cent, of our export income. The latest figure, which is for June, 1957, shows that our commitment in this respect has risen to 8i per cent. So you can see the difficulties the Government has built up for this country in a short space of years. How are we going to meet this extra expenditure? In this coming year we are to provide finance for another £50,000,000 worth of imports. So we have to boost our export income, and the more the burden we put on our export income the greater the difficulties we will create for this country and its people. 1 have already pointed out what the bill provides, or what the Government says it provides. In my opinion every time we raise an unnecessary loan overseas we are putting this nation and its people further and further into the bondage of international financial interests. There is no doubt in the world that this is happening to Australia at the moment, with this Government in control. So I support wholeheartedly what the Labour Opposition is now aiming to do. I know that I will be told by some Government supporters that raising loans in the way that the Government is proposing has been the practice for a number of years. That is perfectly true. But when it has been realized that a mistake has been made, and as we are said to be living in a democracy, who is more entitled to discuss the question of overseas borrowing before the borrowing actually occurs, and not after the loan is actually raised, than a member of this Parliament? Even in the case of loans raised under the International Monetary Agreement, the validating bills come to this Parliament after the loans have been negotiated. That is not what the Opposition wants. We believe that the terms on which the money is to be raised, the question of whether the money ought to be raised at all, the question as to whether it should be raised overseas, ought to be discussed and determined in this Parliament before a loan is negotiated.
– The interest rate should also be discussed.
– I mentioned that the terms and conditions of the loan should be discussed. How else could anybody argue that we have democratic government in this country? Surely it has been said time after time by world leaders in every country that those who control finance control the government of the country. If the Parliament once sacrifices its control over finance, which includes the raising of loans, it sacrifices its right to govern.
That is something that no democratic country should allow to continue. I therefore support the amendment foreshadowed by the Leader of the Opposition (Dr. Evatt) and I hope that on reflection some honorable members opposite who have spoken in a similar strain, particularly during the Budget debate, will support it.The honorable member for Bradfield (Mr. Turner) made an interesting contribution to the Budget debate, and I suggest that the honorable member for Wentworth (Mr. Bury) might read and examine what he said. I do not know what motives the honorable member for Bradfield had for making some of his statements, but he was most critical of the Government’s continuance of a policy of overseas borrowing. Those honorable members opposite who believe, as we on this side of the House believe, that this is a wrong policy for Australia to pursue should be prepared to express their beliefs in votes rather than in mere words, otherwise their speeches become meaningless and tend only to mislead the electors. The real test is in the vote and 1 hope that the majority of this House will approve the Opposition’s amendment.
– The Opposition does not oppose the bill but it does propose to move in committee an amendment that will clarify and, we believe, rectify the position with regard to overseas loans. Australia’s overseas loan indebtedness is already very great and is becoming rapidly greater. 1 invite the House to compare the overseas loan indebtedness at the time this Government came to office with the present position. I shall make this comparison to illustrate how important it is that we should rectify and clarify these matters dealt with by this amending bill.
T wish to quote from the reports of the National Debt Commission. At the end of June, 1950, when this Government had been in office for just over six months our indebtedness in American dollars was less than 200,000,000 dollars. It is now over 500,000,000 dollars. In addition to that, in the meantime great debts have been incurred in Canadian dollars and Swiss francs. The principal increase in the indebtedness has been due to the borrowings by this Government - not by State governments. The borrowings of dollars by the State governments have been negligible. The amount of dollars owed by the State governments is practically all in respect of pre-war loans. But I wish to compare the precise indebtedness of the Commonwealth in dollars. On 30th June, 1950, the Commonwealth owed 76,553,000 dollars. At the end of June last it owed 359,119,000 dollars. It may be relevant to compare our internal increase of debt in that time. It is well known, of course, that the Commonwealth’s indebtedness within Australia has decreased during this Government’s term of office. The Commonwealth Government’s indebtedness within Australia has decreased in fact from £1,749,409,712 to £1,496,353,710, but the total indebtedness of Australian governments within Australia has increased during those nine years from £2,499,517,561 to £3,590,105,706. That is a large increase. The State debts, upon which, of course, we rely very largely for our public works - we rely on State debts for two-thirds of the public works in Australia - are financed internally. But the external debt is practically entirely a Commonwealth responsibility.
– What has this to do with the bill?
– The Minister forwent his opportunity to speak on the bill because he had nothing worth while to say, as we have come to expect. Now, in his unmannerly utterances, he is seeking to interrupt somebody who has something to say about this large and increasing national problem.
– Order! I ask the honorable member to relate his remarks to the bill.
– I aim to show that this bill deals with a vital matter, that is, our overseas borrowing; our technique of borrowing overseas. The Attorney-General (Sir Garfield Barwick) has very rightly seen a flaw in our legislation which will affect our ability to raise loans overseas. That flaw will very gravely affect the Government’s ability to carry on government as it has been accustomed to carrying it on in the last nine years. I have pointed out that our dollar indebtedness has increased from just under 200,000,000 dollars to more than 500,000,000 dollars in the last nine years.
The Leader of the Opposition (Dr. Evatt) quoted from the answer given by the Treasurer (Mr. Harold Holt) to the honorable member for Scullin (Mr. Peters) last February dealing with the specific loans that have been raised overseas. The answer indicates not only the size of the problem, but the way it is growing. Up to that stage - last February - we had raised six dollar loans with the International Bank for Reconstruction and Development. We had raised eight other loans from other sources, and those other loans were not the subject of legislation before the House. We only learned of them from the newspapers or from the papers presented with the Budget each year. Such loans do not come before this House in any other way.
Two things are significant about those other eight loans. The first is that four of them, amounting to more than £84,000,000 out of a total of £171,000,000, were raised last year. That is, more than half of the dollar loans raised outside the World Bank have been raised in the last year. The other significant thing about the private dollar loans is that the interest rate has been increasing. When the first of the loans was raised five years ago, the interest rate required in New York was 3i per cent. The interest rate on the last loan raised last year was 5 per cent. It is quite plain, therefore, that this bill deserves the earnest consideration of the House, because it deals with a problem that is already large, and a problem that is growing in intensity.
The amendment which the Leader of the Opposition has moved will at least see that the Australian people are given an opportunity to ventilate this problem at regular intervals.
– Has the Leader of the Opposition moved the amendment yet?
– That does seem to be a coherent and relevant interjection, and I thank the Minister for making it. It is true that the Leader of the Opposition only foreshadowed the amendment. Any tax which the Commonwealth levies has to be the subject of a specific act. That is, the
Australian people are given the regular opportunity to superintend their finances as far as those finances depend on taxes. We are not, however, given an opportunity to superintend our finances as far as borrowings are concerned. That is, we can go into debt unbeknown to the Australian public, whilst we pay our way from taxes under public scrutiny.
I would invite the Attorney-General, representing, as he does, the Treasurer, and also in his capacity as Attorney-General, to explain to the House why it is necessary to pass a bill to deal with some overseas loans but not others. This is one matter that mystifies many people in the House as well as many people in the community. If one looks at the list of Commonwealth acts that have been passed under placitum (iv) of section 51 of the Constitution - which permits the Commonwealth to borrow money on the public credit of the Commonwealth - one sees that the only loans overseas which are the subject of specific legislation are those first of all from the International Bank for Reconstruction and Development. Such loans were raised in 1950, 1952, 1954, 1955 and 1957, and in 1957 an additional loan was raised in respect of Qantas Empire Airways Limited. There was, secondly, a loan of Canadian dollars in 1955 and* thirdly, loans of Swiss francs were raised in 1954 and 1955. All of these were the subject of legislation. But eight loans raised between 1954 and 1958, which were listed by the Treasurer in the reply which he gave to the honorable member for Scullin last February, and the loan which is being floated in New York at the moment, have not been the subject of specific legislation.
I think it would interest the Australian people to know why it is that we have or choose to pass legislation in respect of loans raised through the International Bank, or from Canada or Switzerland, whereas we do not have or choose to pass legislation in respect of loans from other sources such as New York, this loan being the ninth obtained there by the present Government.
Sir, I do not condemn indebtedness overseas with equal severity in all spheres. The Opposition accepts the amendment of the law made in this bill in order to permit a government which gives an undertaking to honour that undertaking. It is quite obvious that, if there are certain respects in which money has to be borrowed overseas, our law should permit the Government to honour its undertakings. As I have said,. Sir, we accept that as regards public loans. There is an advantage in public loans as distinct, from private capital in that under the Constitution governments can guide the manner in which the proceeds of public loans are spent, whilst they cannot guide the manner in which private capital is invested in general, although the Commonwealth Government can guide the manner in which private capital from overseas is invested.
There may occasionally be cases in which public loans have to be raised overseas, and we accept the amendment of the law in that regard which has been introduced by the Attorney-General. But our overseas borrowing is already a great problem in this country, and it is becoming a greater problem at an alarming rate. We want the position, in regard to overseas borrowing, to be dealt with by the people’s elected representatives in this Parliament in a fashion which will require an explanation to be given whenever the occasion to borrow overseas arises in the future.
.- Mr. Deputy Speaker, I wish to support the amendment moved by the Leader of the Opposition (Dr. Evatt).
– It has not been moved yet.
– The right honorable gentleman foreshadowed an amendment.
-Order! The honorable member may not speak to the amendment now. It will be dealt with in committee.
– I support the proposal made by the Leader of the Opposition. I think that the principle involved in this measure is very unsound. I am opposed to the bill altogether. I consider that, it will establish, two classes of vested interests in Australia. The overseas bondholder is to be put in a. special position in which he will be free of any tax on his Australian bondholdings, in respect of both interest and principal. He will’ also be exempt from tax or, duty in respect of the estates of deceased persons, property derived from deceased persons, and gifts or other dispositions of property. On the other hand, an Australian resident who subscribes to a loan in Australia will be subject to taxes, gift duties and estate duties just as is any other person in Australia. A person resident in the United States of America or any other country who subscribes to Australian loans and then comes to live in Australia will, under the terms of this measure, lose the exemptions afforded to subscribers who remain in their own country. This situation, further emphasizes the imposition on Australian residents as compared with foreigners. Proposed section 6b of the principal act contains these words - . . the stock or security . . . will be exempt from . . . taxes imposed in the Commonwealth except where the stock . . . is the property of a person included in a particular class of persons … all residents of Australia . . .
So a person who becomes a resident of Australia immediately loses all the protection afforded to overseas bondholders. I think’ that that principle is very wrong indeed.
The Attorney-General (Sir Garfield Barwick) stated, in his second-reading speech, that the. need for this amendment of the. law is urgent and that it arises from the fact, that the Government is presently engaged in negotiations which it is hoped will lead to the raising of a further 25,000;000 dollars on the New York market. I think it is about time the Government put a stop- to the raising of money on the New York market in this way. Like, I think; all other honorable members on this side of the House, and like some honorable members on the Government side, I believe that if there is an acute shortage of dollar or sterling exchange for the purchase of essential goods, especially capital equipment, manufacturing machinery and the like, the government of the day must ensure that those essential goods are obtained, and it might be necessary, for that purpose, to raise a loan. But, to-day, we have substantial balances of overseas reserves. Although they have been greatly depleted by this Government, they are still’ very’ substantial. Before the war, our overseas reserves were very much smaller than they are to-day, but we always thought they were sufficient in those days. The Government has recently increased the permissible level of imports by £50,000,000, and has allowed a more liberal choice by permitting importers to buy on the dollar market or the sterling market, whichever they prefer. The whole inference behind this action is that sterling exchange is freely available, and if it is freely available, there is. no need for us to raise a loan of this kind.
I believe- that we are only placing Australia in pawn by raising such loans overseas, because we- are building up a big interest bill- and. we shall have to send a great deal of our production overseas each year to meet- it - something for which we shall receive no return at all. If this continues indefinitely, too great a burden will be- placed on our producers and the people will suffer as a result. Therefore, I would go so far as to express the hope that the House will be prepared to do whatever it can to prevent the Government from borrowing this money overseas.
We know that the Prime Minister (Mr. Menzies) was recently overseas, and we have been told that he really humiliated Australia by cringing to overseas financiers and pleading for a loan for the improvement of the railway line between Townsville and Mount Isa, in Queensland. I believe that it was quite unnecessary to seek a loan for that purpose, because everything that is needed for. the project is readily available in this country. We have at hand Australian labour, Australian sleepers, and Australian steel for the rails.
– And. any amount of earth I
Mr-. CLARK. - There is plenty of earth for earthworks- and’ plenty of material for the ballasting of the line. Those are the principal requirements, and all of them are readily available in Australia. We need not seek them overseas. In addition, all the capital required for the work could be made available through the Commonwealth Bank on government guarantee by a mere stroke of a, pen. It is humiliating indeed for the Government to seek funds overseas and to place us in. pawn. I am very pleased, to know that it was unsuccessful in its search; for overseas funds for the Mount-
Isa railway project. I understand that the Government has approached West Germany for a loan. If it cannot get the money there, perhaps it proposes to seek it in East Germany or, even further, in Russia, because it has no conscience about the raising of funds for its purposes.
I repeat that, in the first place, the principle of this bill is bad. It will establish a very bad precedent. This is a financial measure, and it is a principle of parliamentary government that all grievances must be redressed before the Parliament agrees to make funds available to the Crown. This bill is a means of making money available to the Crown, and, for that reason, we are entitled to express our opinions about it.
Sitting suspended from 12.45 to 2.15 p.m.
.- The Leader of the Opposition (Dr. Evatt) proposes an amendment to this bill, the purpose of which is to give Parliament the right to consider suggested overseas loans, and the conditions under which they are to be raised, before any commitments are made by the Government. In order to show that Parliament should consider overseas borrowing and its conditions before loans are launched, I wish to demonstrate briefly how the overseas loan raisings of the Government will ultimately be to the disadvantage of the Australian people.
How do the proceeds of these loans come to this country? They come, of course, in the form of goods. If they come in the form of goods that are used to promote the development of the Australian economy, then there can be no objection to such loans. If they come in the form of tractors that cannot be manufactured here, or in the form of aeroplanes to be used to transport our goods, and which cannot be manufactured here, then they add to the wealth of the Australian community.
-“ Elementary “, says my friend. Well, how have these loans come to this country in the past? The honorable gentleman who introduced this measure said -
The Government is presently engaged in negotiations which it is hoped will lead to the raising of a further 25,000,000 dollars on the New
York market. The proceeds of this loan will be used for the borrowing programme of £220,000,000 approved by the Australian Loan Council for 1959-60.
If it is elementary that loans are to the advantage of this country when they promote its development, then it is also elementary that if loans are used to bring into Australia Tobler’s chocolates, or brummagem jewellery, or, as is the case at present, outboard motors from America, the importation of which is destroying an industry in my electorate and another in Sydney, then they are not to the advantage of the people of this community. I suggest that the loan of 25,000,000 dollars, which the Attorney-General (Sir Garfield Barwick) has said will be used for the borrowing programme of £220,000,000 approved by the Australian Loan Council, will not come to this country in the form of goods that promote our economy. If this amount is to come here in the form of goods, I challenge the Minister to state specifically what particular kinds of goods will come here from the United States of America.
In reality, of course, what will happen is this: The amount of 25,000,000 dollars will be used as a book-keeping entry, as the honorable member for East Sydney (Mr. Ward) has said, to finance the deficits that have been growing in this community during the last ten years. During the period in which this Government has occupied the treasury bench, our overseas trade balances have declined to the extent of £1,000,000,000. Although we have exported from Australia in the last ten years more than we exported in the previous 40 years, we imported at the same time such a quantity of goods that, taking into account not only the cost of the goods, but also transportation charges for them, interest payable on overseas loans and dividends paid on overseas capital invested in Australia, we finished up £1,000,000,000 in the red.
When this Government came to power ten years ago, we had approximately £800,000,000 in overseas balances. This amount has been reduced to about £500,000,000. This accounts for £300,000,000 of the deficit of £1,000,000,000. Another £700,000,000 remains, and this is represented by loans raised in America, in England, in Canada and in Switzerland. These loans have come to this country in the form of goods, as I said previously, and any one who has travelled by air in Australia during the last few years knows that there is not a confectionery shop at any airport that is not full of chocolates and confectionery manufactured overseas. Luxury items have been brought to this country that are not essential to our economy, and their import has destroyed opportunities of employment for Australian people and opportunities for the expansion of Australian industry.
– Order! I think the honorable member is completely wide of the mark, and has been since he started.
– Mr. Deputy Speaker suggests that I am completely wide of the mark in discussing this matter.
– Order! The virtues of overseas loan raising are not in question. The matter before the House concerns the clarification of a provision that has been in existence in our legislation for 40 years. The honorable member has not mentioned it yet.
– The point that 1 am trying to put before the members of this Parliament is this: We are continually raising loans overseas. There is a bill before us dealing with a proposition to raise an overseas loan, and to that bill the Leader of the Opposition has moved an amendment designed to give Parliament the right to consider suggested overseas loans, and the conditions under which they are to be raised, before any commitments are made by the Government. If overseas loans were being raised under admirable conditions, and if every overseas loan that was raised was essential in the interests of our community, the Leader of the Opposition would have no justification for moving such an amendment.
– Order! The honorable member is wrong. There is no amendment before the House.
– Well, a proposed amendment.
– That will be discussed when it is moved. The honorable member will keep to the measure before us.
– It is, of course, very difficult when one is so confined. This bill endeavours to give preferential treatment to overseas investors. It says to those who will put their money into loans raised overseas, and which, as I say, it should never be necessary to raise, “ You will get better treatment in respect of the money you put into these loans, and the interest on that money, than Australian investors. Your money will be free altogether of taxation in Australia.” Who will be the overseas investor? Will it be the little man walking the streets of New York, who will stroll into the High Commissioner’s office and invest his ten or fifteen dollars? No, the investors will be the big industrial organizations, the corporations. And among those corporations I include General Motors. What could occur is this: The General Motors corporation could go to the High Commissioner’s office or the Commonwealth Bank and say, “We desire to invest 25,000,000 dollars in the 25,000,000 dollar loan being raised for Australia “.
If it did so, what would happen? A bookkeeping entry would be made transferring the Australian equivalent of 25,000,000 dollars already in the industry run here by General Motors-Holden’s Limited to the use of the Commonwealth Government. That portion of the profits of General Motors-Holden’s Limited would not bear the same rate of tax as dividends paid to Australian investors; it would not bear the same rate of tax as dividends paid to other overseas investors who are not parties to the agreement between the United States of America and Australia. The company would already be reaping the advantage of about 3s. in the £1 in tax as compared with investors resident in Australia and then it would not have to pay any Australian tax on the income from the investment in the 25,000,000 dollar loan. That is obviously the position, and by sleight-of-hand the overseas industrialists are becoming richer and richer at the expense of the general Australian public and the Australian investors in Australian industries.
I do not want the Attorney-General, who is sitting at the table and smiling in that superior way that one expects of him, to take my word for this. A gentleman named Sir Arthur Warner, a Liberal member of a Liberal government in Victoria, said, “ I must sell my investments to the tune of more 0han £1,000,000 in an Australian company to .overseas .investors because overseas investors get a better opportunity and make a better profit than do Australian investors “. The Government has made it so profitable for Australian investors to sell their interests in Australian industries to overseas investors that more and more of Australia’s economy is being dominated by absentee investors. Of course, when introducing bills of this kind, men with the astuteness of the Attorney-General, who is the representative, jumping-jack and puppet of big business, take great care not to talk in a language that can be understood. He obfuscates everything. He hides the issue under a lot of words, and having brought forward a bill which is obviously to the detriment of Australia, he uses a lot of words and ends by saying in effect, “Everything in the garden is lovely. I commend this bill to the consideration of honorable members “. But he does not go into details. He does not tell us what the Government will buy with the loan; he does not tell us how the loan will come into the country; and he does not tell us how the big overseas financial interests are getting a stranglehold on Australian industry. He also does not tell us that whoever controls the economy of this country controls the Government of this country and that if ultimately big industry is controlled by absentee investors, the party that sits on the treasury-bench becomes almost impotent. I remember that only the other week a State government said that it would licence petrol stations.
– I take a point of order. Mr. Deputy Speaker. This morning you pulled me up and ruled that I was out of order for discussing matters that were very much closer to .the bill than is this speech. I suggest that, as I was ruled out of order, the same treatment should be accorded to others.
– Order! I remember ruling that the honorable member was out of order, and I still say that I was perfectly correct in doing so. I will say, however, that no other honorable member who has spoken to the measure has stuck strictly to it, and they have all been called to order in exactly the same way as I called the honorable member for Wentworth to order. The honorable member for Scullin is giving his views, but he is wandering on brief excursions into the unknown.
– A Daniel, yea a Daniel! I have the greatest admiration for that ruling. I was pointing out that, in the interests of this country, it is not merely essential .that we call ourselves a democracy. I think it was Edmund Burke - I ask the Attorney-General to correct me if I am wrong - who said, during the discussions on taxation of the American colonies, that liberty is inherent in the question of taxation. So, liberty is inherent in our capacity to .control the economic factors affecting our community. If a big oil combine can, as I pointed out, say to a government in this country that it must not license petrol stations, and if a big industrial undertaking is able to say to a government in this country that it shall do this or that in connexion with a railway line to Mount Isa, government of the people for the people perishes from the earth. On that note I resume my seat.
.- I shall not take very much time in speaking to this bill, but there are one or two points about it that I think at this stage should be made a little clearer than they now are. The first point is that this bill is of very limited significance and importance. It is not an important bill and it is not a significant bill in any way at all. It has arisen, presumably, because the provisions of the Loans Securities Act 1919-1956 allow those who are resident overseas and who invest in Australian government bonds to receive their interest on those bonds free of tax. Apparently the intention of the act, in the first place, was that the interest received by overseas investors should be free of all forms of tax, but presumably in recent years some executors of estates found that they were liable to pay gift duty or estate duty in respect of Australian bonds held in the United States of America. I say “ presumably “ because we have had to draw conclusions to that effect. The AttorneyGeneral (Sir -Garfield Barwick) in introducing the bill did not tell us of this. I heard it for the first time from the honorable member for Melbourne Ports (Mr. Crean).
Perhaps it is reasonable to believe, in the circumstances, that this is the machinery behind the bill.
The first point that emerges is that the Government has given the House very little information about it. There seems to be some kind of implication for the necessity of this bill, and I think the Attorney-General (Sir Garfield Barwick) could have taken the House a little more into his confidence and told honorable members details of the circumstances which gave rise to the need for this measure. As it is, we have been left to guess. Perhaps the honorable member for Melbourne Ports (Mr. Crean) has made a very good guess, but we do not know for sure. I raise this point because the Government is in the habit of doing this kind of thing. The speech of the Minister - a gentleman who is notable throughout the country, it seems, for his clarity of expression and his persuasive ability - in this case has a good deal of the abstract about it. Among other things he said -
This undertaking has always been understood abroad to mean that non-resident holders of Australian bonds would be exempt . . .
Am I to take that to mean that nonresident persons overseas have been exempt? He said, “ would be exempt “. Presumably they have been exempt, too. We do not know, except by guessing, the circumstances which have given rise to the need for this bill.
Presumably the sole effect of the measure is to put beyond doubt that overseas investors in Australian Commonwealth bonds, from now on, will be exempt from estate and gift duty as well as from all other forms of taxation. Apparently that is the sole significance which this bill possesses. That being the case, the position which the Opposition takes up is that if Australia has given an undertaking to these overseas investors since 1921, which we thought was expressed in the 1919 legislation, that they would be exempt from this kind of tax, then it is fair to pass legislation to make that exemption effective. It is fair that we should keep our word to those people. That is the full significance of this bill. That being so, it is wise and necessary to point out to the House that support for this minor, insignificant amendment - for that is, in effect, what it is - does not mean, at the same time, support for the principle of tax-free investments for these holders of Australian Government bonds. To support this legislation, I take it, does not involve those who do so in accepting the principle that persons overseas -who invest in Australian Government bonds should be free of all forms of taxation. I, for one, do not accept that, and as far as I am concerned, my support for this :bill does :not carry support for that principle.
Likewise, this measure being a narrow and insignificant one, concerned only with a very minor, insignificant amendment to some 1919 legislation, does not imply that those who support it support Government overseas borrowing. You have ruled, Mr. Deputy Speaker, that the House is not permitted .to discuss the question of overseas borrowing because that is not relevant to the bill. However, I think it is necessary to make clear that support for this bill does not in any way involve support for the practice of overseas borrowing as adopted by this Government. The next point which emerges is the foreshadowed amendment of the right honorable Leader of the Opposition (Dr. Evatt). It provides that before proposals for borrowing overseas are adopted by the Commonwealth of Australia they should be dealt with in Parliament. This is a matter of far greater significance, and I presume that at the committee stage the discussion will be broad enough to allow us to examine the reasons why the Opposition considers it is necessary that before overseas loans are entered into by the Commonwealth Government or by its executive, the proposal to do so should be discussed in Parliament. The principle involved is that the people of Australia have .a right to say how money shall be raised by loan just as they have a right to say how money shall be raised by taxation. Although Parliament is far from being a perfect expression of the opinion or voice of the people, nevertheless it is the only voice they have. They should be entitled to use that voice when the Government proposes to raise funds by loan, just as in the case of raising funds by taxation.
In conclusion, I point out that consideration of this bill should not take much time because it does not involve matters of any significance. It does not involve any member of this House in supporting anything of great significance, because it is a narrow piece of legislative machinery, of little importance.
Question resolved in the affirmative.
Bill read a second time.
Clauses 1 and 2 - by leave - taken together, and agreed to.
Clause 3 agreed to.
Proposed new clause.
. -I move -
That the following new clause be inserted in the bill:- “2a. Section three of the Principal Act is amended by adding at the end thereof the following sub-section: - (3.) Notwithstanding the provisions of this Act or any other Act, no stock or security shall be issued by or on behalf of the Commonwealth outside Australia on or after the first day of October, 1959, without the approval of the Parliament.’.”.
This is the amendment which I foreshadowed during the secondreading debate, and as the honorable member for Yarra (Mr. Cairns) pointed out a few moments ago, it places before the committee a far broader question for consideration. It asks that before the Commonwealth Government issues securities free from taxation the matter must first be referred to Parliament, and that it shall be made perfectly clear that the income therefrom shall not be subject to the forms of taxation mentioned in the bill, such as estate duty, gift duty and the like. This raises a far more important question, because one could notice throughout the debate on the second reading of this bill the difficulties that honorable members were experiencing in getting to grips with the broad question of overseas borrowing a question of tremendous importance.
At an early stage of the debate I quoted figures showing the enormous total of overseas borrowing, and certain honorable members have referred to the effect of overseas borrowing on our economy. The view of the Labour Party is that the amount of the borrowing is grossly excessive. Occasions do arise when an overseas loan may be justified, but such occasions are exceptional and, having regard to the present state of development of Australia, many honorable members on the Government side certainly some of them have criticized, during the recent debate on the Budget, the extent of overseas borrowing.
The question is: Who shall decide whether an overseas loan is necessary? If it were a matter of ordinary routine borrowing, one could understand the power being vested in the Executive. But all such borrowings involve our relations with other countries including, necessarily, the trading relations between Australia and the other countries of the world. Therefore, this is a matter which should be looked at carefully by the representatives of the people sitting in this Parliament. The power to pass laws in relation to public borrowing by the Commonwealth is conferred on the Parliament by the Constitution. While the Constitution does not make this duty obligatory, it does indicate that the essential power is with the Parliament. Our contention is that these overseas borrowings are so important to the future welfare of our country that the Parliament must exercise some direct supervision over them. That was the case earlier in the history of the Commonwealth, notably in the period after the First World War, when the government of the day indulged in excessive overseas borrowing and so reduced the Australian economy to a state of grave recession, and contributed to depression.
The proposition that I have advanced should commend itself to all honorable members because if they accept it they will be able to ascertain the countries from which loans will be obtained, the terms of the loans and other important associated conditions, apart from the rate of interest. Why should not an overseas loan be subject to the approval of the Parliament? We submit that it should be. Already, during the debate, examples have been given of the effect on Australia of our extensive borrowings. It has been emphasized correctly that the figures are startling. They must be looked at and checked.
I do not wish to repeat the statements that I made at an earlier stage of the debate, but honorable members who are anxious to discuss broadly the power of the Commonwealth, the power of the Parliament and the necessity to keep the Executive within reasonable limits, will agree with me that the only way to do this is to restore to the Parliament the great power of the purse, which is as important as the power to impose direct taxes and to raise loans overseas. I realize that, to some extent, I am repeating the points that I made earlier, but these are very important points. I ask the committee to consider the proposed amendment. We shall divide the committee on the proposal with a view to the amendment being incorporated in the legislation.
.- Probably the amendment that has been proposed by the Leader of the Opposition (Dr. Evatt) has been prepared in a fairly short time, and that, I hope, will excuse the oversights which it involves because, if one understands how borrowing is effected under our constitutional set-up, one will see immediately how inappropriate and impossible is the amendment.
Let me, first, point out that borrowing by the Commonwealth, except for certain particular purposes, is effected under the Financial Agreement, which is part and parcel of the Constitution, and which may not be altered except by the constitutional process that has been set out for amending it. Under the Financial Agreement there are two classes of permanent loans. I put on one side temporary loans. The first is loans that are borrowed for the States, and the second is loans that are borrowed for Commonwealth works. Where loans are borrowed for the States, they must be sought by the Commonwealth, because the Financial Agreement is mandatory on that point. It says that when the States have decided, through the Australian Loan Council, on the borrowing, on the terms of the borrowing, and on the locus of the borrowing, the Commonwealth shall borrow according to the mandate of the Loan Council.
During my secondreading speech on this legislation, I stated that this particular loan was for the purposes of the States, as indeed have been all loans for some time. This loan is truly a State loan, and it falls within that portion of the Financial Agreement which enables the Loan Council, as it has done, to determine that there shall be a borrowing, to determine the terms of the borrowing and to determine the place of the borrowing. The loan to which I am now referring cannot, under the constitutional set-up, fall within the purview of this House to say yea or nay.
The amendment that has been so blithely put forward by the Leader of the Opposition suggests that this Parliament shall attempt to do something that is truly not within its capacity, namely, to say that a loan which has been authorized indeed directed by the Loan Council shall not be made, although the Financial Agreement, which has been woven into our constitutional set-up, states expressly that when the Loan Council has determined upon a loan I am referring to loans for the States the Commonwealth shall make the borrowing according to the terms fixed by the Loan Council. Of course, also in cases of a borrowing by the Commonwealth for its own purposes, the Loan Council fixes the terms and conditions under which the borrowing shall be made. This Parliament has no authority, as it were, to ride in on the Loan Council and its determinations. This is a result of the Financial Agreement, and the amendments that were made to the Constitution when section 105a was included. This committee has been invited to do something which more likely than not is beyond its powers.
– Is not the Minister saying that the Government may do something, but that the Parliament may not?
– No, I am not. That is the next point to which I shall move. All borrowing by the Commonwealth must be upon a statutory or constitutional authority. The Financial Agreement is regarded as itself an authority to borrow. That represents the necessary authority. In the case of loans raised for the loan programme, there is no need to seek separate and independent parliamentary authority. While the loans are going into the loan programme as authorized and dictated by the Australian Loan Council, the Financial Agreement is regarded as sufficient authority to the Government to borrow the money. As I point out, it is not only an authority under the Financial Agreement, but it becomes a duty.
The States did not enter into the Financial Agreement in order to allow this Parliament to determine that the resolutions of the States to borrow money should be vetoed here. That is the proposal contained in this amendment. It only needs to be put in that fashion to show how misconceived this amendment is.
– That is a new line.
– Of course it is a new line. But the important thing is to. know something about it.
– It is the Barwick line.
– I do not mind its being called “ the Barwick line “. There is nothing’ wrong with that line.
What I have said leads me into an answer which I was invited to give to the honorable member for Werriwa (Mr. Whitlam). If we look through the statutes we find that, in the case of the Swiss loan and the Canadian loan, separate statutory authority was obtained from this House.
– And in the case of the World Bank loans.
– Yes. The reason for the special statutory provisions in the case of the Canadian and the Swiss loans was that the proceeds of those loans were not going into the loan programme. Those loans went into trust accounts as will be seen from the terms of the acts themselves. As their proceeds were not going into the loan programme, an express statutory authority was needed and was obtained for them. Many other overseas loans have been negotiated and securities issued under the authority of the Financial Agreement. That has been done, not only by this government, but by the prior government.
In the case of loans from the International Bank for Reconstruction and Development, statutory authority was sought because that bank prefers to have a loan ratified by the Parliament. Out of deference to the Bank’s wishes, those loans were brought specifically to the Parliament for statutory authority. But apart from those very special cases, the Financial Agreement covers the whole of what is necessary; for the ordinary loan programme, both in regard to authority and machinery for determining the terms, conditions, and the locality, as it were, of the borrowings.
Apart from those reasons, which I think are very cogent, for putting on one side this amendment, there is the question of practicality. In 1956, when the amendment was made to section 3 of the Loan Securities Act,, and section 6a. was inserted, there was a debate in this House in the course of which the practical need to have a provision such as the. present section 3 was explained. The House accepted the explanation and made the necessary adjustments.
It is. not feasible to bring to the House, either before the negotiations or in the midst of negotiations, the terms and conditions of the loan and the question of whether you will or whether you will not borrow. But if any loan is to be sought which is outside the Financial Agreement and outside any other statutory authority very often there are standing statutory authorities for borrowing the authority of the Parliament has to be sought. Ample opportunity is then afforded to members to place a limitation on where the loan is is to be sought. That is quite within the competence of the Parliament and there is no need for this amendment to secure that result The proposed amendment, of course, is general; it is not circumscribed. It. is not limited to loans which are outside the Financial Agreement. It covers them. For these reasons, both practical and legal, I suggest that the amendment is quite inappropriate andunacceptable.
The genera] question of borrowing overseas is surely not in debate or at issue here. The view of the Labour Party has been put again and again, and I suppose that everybody understands it. I am not going to debate it, but it can be epitomized in these words: When you need to expand in this country and you have not generated enough local capital to enable you to expand, you do not borrow overseas. That is taboo. You do only one of two things you do not expand, or you turn the printing press.
– The AttorneyGeneral (Sir Garfield Barwick) was worth listening to until he came to the last sentence. If anybody is turning the printing press in Australia to-day it is this
Government. It has been budgeting for deficits for years and financing its operations by the use of the printing press because it cannot cadge enough money from any country anywhere in the world to supply its needs and maintain some, appearance of financial stability.
– You have lowered the tone of the debate.
– I could never get down to the honorable gentleman’s level, no matter how hard I tried. The Labour Party has a proud and honorable record in the flotation of overseas loans. The Scullin Government inherited a mess from the Bruce-Page Government, the last two loans of which had failed on the London market to the extent of 80 per cent, and 70 per cent, respectively, and had to be taken over by the underwriters, Nivison and Company. So, the Scullin Government had to clean up the mess of a previous anti-Labour government in the matter of loan raisings. In the early ‘twenties, the position was so bad because of the competition between the States and the Commonwealth on the loan market that a constitutional alteration was found to be necessary in order to protect Australia against such behaviour in future. The Australian Loan Council was set up because of excessive overseas borrowing in previous years.
The Opposition is anxious to protect this country against excessive overseas borrowing. We have a very strong fear of the consequences of overseas borrowing. Every railway in Australia was built with money loaned from Britain. The interest paid on those loans has repaid the capital several times over, but the capital debt remains, and we are still paying interest on it. That justifies our fears about loan raising.
The Opposition is putting forward a quite reasonable proposition. We say that the Commonwealth Parliament should be consulted before loans are raised. The AttorneyGeneral has said that the States make the decisions in the Loan Council. The States may nominally make decisions at Loan Council meetings, but in reality the States do not count at those meetings. The important figure is the Treasurer of the Commonwealth, and the States have never refused to agree to what the Com monwealth Treasurer of the day has decided.
The Attorney-General has said, in effect, that the Executive is supreme, and that Parliament has no right to a say in the matter. The Opposition contends that the conditions of loans should be brought to Parliament in order that the matter may be properly dealt with. Why are we discussing this bill to-day? We are discussing it only because, when the 1953 conventions were being drafted the then Treasurer failed to consult the then Attorney-General. The Department of the Treasury ignored the Attorney-General’s Department, just as the Department of Social Services, apparently, has ignored the AttorneyGeneral’s Department in the matter of the 5s. payment for medical prescriptions. Alternatively, the Attorney-General’s Department itself has failed on both those occasions.
The Opposition is not opposing the principal’ that the Commonwealth shall honour its obligations. We are not in favour of repudiation. We do not want to harm the prestige of Australia abroad. We do not want to harm the success of this loan. But we say that, in future, the Government should not make arrangements for overseas loans without consulting the Parliament. It is true enough that money is paid into a trust fund, as the AttorneyGeneral has said, when borrowing from the International Bank or from Canada or Switzerland, but ultimately that money is spent by the Commonwealth Government; and if we can have a say on the ramifications of agreements or anything concerning, the terms of loans at any stage, we ought to be able to have a say in respect of all loan raisings.
It is useless to say that the Australian Labour Party followed the same practice as is followed to-day. We can change the practice, and we think that we ought to change it. Our record was never one of borrowing. As a matter of fact, the Chifley Government established a great precedent for all governments. We borrowed only once between 1946 and 1949. We repaid at least £100i000,00fr in London, and repatriated a lot of our loans in New York. In addition, every conversion loan we floated at home: and abroad, was raised at a lower interest rate than, the rate on the loan we were converting. We saved Australia a great deal in interest payments as well as reducing our capital indebtedness abroad.
This Government has reversed that policy. We object to the credit of Australia being placed in pawn in the pawnshops of London and New York so that this Government can get a few millions of pounds here, £11,000,000 in New York, and £4,000,000 in Switzerland. Maybe it will try to get £20,000,000 from Khrushchev later or perhaps £20,000,000 from Mao Tse-tung so that the Government can say that our international funds abroad are sufficient to enable us to carry on. We say that all that is wrong, and we want a change. Reverting to the Loan Council, we say that it is within the capacity of this Parliament to say whether or not the Commonwealth Government shall agree to arrange loans for the benefit of the States and debate the terms on which the loan shall be given. We also say that the States ought to have the right to debate these terms in their own Parliaments if they wish to do so. The establishment of the Australian Loan Council did not set up a financial dictatorship, and the Australian people should not be dragged along willy-nilly by it. The Minister said that the hurried nature of the discussions excused the oversights involved. We acknowledge no oversight. We know where we are going and what we want. The Minister has tried to evade the issues by misrepresenting the situation.
Sir, the Australian Labour Party if in power to-morrow, would try to raise its loans internally. We would restore the financial stability of Australia so quickly and so soundly that the Australian people would again have confidence in lending their money to the Australian Government. When this Government was elected it destroyed the credit of the Australian bond market by floating loans at a higher rate of interest and so depreciated the 3 per cent and 31/8 per cent loans which we had floated. We never paid a penny more than 31/8 per cent interest on any loan at any time. This Government depreciated the bonds so much by its actions that the loans to which I have referred fell to £80 or £85 on the stock exchanges for every £100 in vested. Returned soldiers organizations, church bodies and others which invested money in bonds during the Second World War as a patriotic gesture found, when they wanted to use their money after the war, that they had to lose £10 on every £100 if they sold their Liberty and Victory and Security bonds on the stock exchanges. That is the level to which this Government has reduced the credit of Australia. Only a Labour government will restore it (Several honorable members rising in their places) -
Motion (by Sir Garfield Barwick) put -
That the question be now put.
The committee divided. (The Temporary Chairman - Mr. T. F. Timson.)
Majority . . 26
Question so resolved in the affirmative.
Question put -
That the clause proposed to be inserted (Dr. Evatt’s amendment) be so inserted.
The committee divided. (The Temporary Chairman - Mr. T. F. Timson.)
Majority . . . . 27
Question so resolved in the negative.
Title agreed to.
Bill reported without amendment.
Motion (by Sir Garfield Barwick) proposed -
That the report be adopted.
.- Mr. Deputy Speaker, I want to raise a question in regard to the adoption of this report, which I consider has not been properly considered by this House. During the secondreading debate when you yourself, Mr. Deputy Speaker, were in the chair, you prevented me and other members of the Parliament from expressing a certain point of view because, you said we would have our opportunity to do so at the committee stage when the amendment foreshadowed by the Leader of the Opposition was moved. We were denied that opportunity because the AttorneyGeneral, after a merely cursory discussion at the committee stage, in which only three speakers took part, gagged the debate. And not only did he gag members of the Opposition; when he moved that the question be put there were Government supporters on their feet who wanted to express a point of view.
– Order! The honorable member may not canvass a decision of the committee.
– I am not canvassing it. I am rejecting it.
– The committee has made a decision, and the honorable member may not canvass it.
– I am giving you the reason why the report should not be adopted. I say that the report has not been properly considered by members of this chamber. They have not had an opportunity to consider it.
– It has been properly considered.
– I am of the opinion-
– Order! The committee has made its decision. The honorable member is out of order.
– What did the committee decide?
– Order! The amendment was defeated.
– The committee decided, by the use of the Government’s brutal majority, that there should be no further debate on this matter. This is one of the most important issues that have been before this Parliament for some time and the Government, which will close up Parliament next week-
– Which will keep the doors closed, is preventing members of the Opposition from expressing a point of view contrary to that of the Government.
– I enter my protest.
– If the honorable member for East Sydney ignores the Chair any further, he will be dealt with.
– I did not hear you, Mr. Deputy Speaker.
– Order! The honorable member will resume his seat.
– I rise to order! The motion before the House is that the report be adopted. The honorable member for East Sydney was giving reasons why the report should not be adopted. The report has not yet been adopted.
– Order! The honorable member for East Sydney is entitled to give reasons only if the report is incorrect.
– He was giving reasons.
– Order! He was not.
– The honorable member is entitled to put his point of view and the House will decide whether the report should be adopted after he and other honorable members have stated their objections to its adoption. I suggest, with respect, that you, Sir, are prejudging the situation by saying that the honorable member for East Sydney is not in order in putting arguments against the adoption of the report.
– Order! The honorable member for East Sydney has not put any arguments. After the decision of the committee had been given he challenged that decision.
– I move -
That the honorable member for East Sydney be further heard.
Under the Standing Orders I am entitled to move that I be further heard.
– Order! Heard on what?
– On whatever subject the honorable member likes to talk about.
– But the honorable member has already spoken.
– I was ordered to resume my seat.
– I move-
That the honorable member for East Sydney be further heard.
– Order! A second time?
– It would not be a second time. You ordered me to resume my seat.
– Order! 1 cannot accept the motion of the honorable member for Kingston. The honorable member for East Sydney is in order in moving that he be further heard. He and he alone can submit such a motion.
Motion (by Mr. Ward) put -
That the honorable member for East Sydney be further heard.
The House divided. (Mr. Deputy Speaker - Mr. G. J. Bowden.)
Question so resolved in the negative
Original question resolved in the affirmative.
– I ask for leave of the House to move the third reading forthwith.
Leave not granted.
Suspension of Standing Orders.
Motion (by Sir Garfield Barwick) proposed -
That so much of the Standing Orders be suspended as would prevent the remaining stages being passed without delay.
Question put. The House divided. (Mr. Deputy Speaker - Mr. G. J. Bowden.)
Majority . . . . 28
Question so resolved in the affirmative.
Motion (by Sir Garfield Barwick) proposed -
That the bill be now read a third time.
– Mr. Deputy Speaker, the Opposition does not intend to oppose the third reading of the bill, but it does intend at this stage to protest against the unfair and improper manner in which the bill was rushed through the committee stage, honorable members on both sides of the chamber being denied an opportunity to consider its provisions. An. important amendment was moved and three speeches only were allowed during the consideration of that amendment. It would seem as if it were a matter of life and death to get this measure to another place this evening. That is not so. There was ample time to allow at least three or four more contributions by honorable members who wanted to speak. The bill could then have been agreed to in the committee without the Opposition being placed under the necessity of protesting against the violation of the rights of honorable members. So, Sir, I protest against the Government’s tactics.
.- Mr.. Deputy Speaker, I also wanted to speak at the committee stage, with particular reference to the argument that the AttorneyGeneral (Sir Garfield Barwick), representing the Treasurer (Mr. Harold Holt), had directed to the legality of the Opposition’s amendment vis-a-vis the Financial Agreement. It is well for honorable members to face up to the implications of the Financial Agreement. This Government, on many occasions, has ignored the very obligations which it now asserts, and it is quite amazing to find it now claiming that there is something sacrosanct about an agreement which it has flouted on so many occasions. Let me point out, Sir, that in a number of years I think, from memory, the financial years 1953-54, 1954-55, 1955-56 and 1956-57 the Australian Loan Council resolved, pursuant to the Financial Agreement, that certain moneys could be raised by the Commonwealth, and should be raised by it. If honorable members look at the Budget Papers in respect of those financial years, they will see and, of course, it was a matter of notoriety at the time that in each of those financial years the Commonwealth chose not to carry out the resolutions of the Loan Council that is, the Commonwealth chose not to carry out the law under the Financial Agreement. The formula which was used, Mr. Deputy Speaker, was that the Commonwealth supported the resolutions of the Loan Council to some lesser amount, representing perhaps 90 per cent or 80 per cent of the amount which the council had resolved should be raised.
In respect of the borrowings now being made overseas for Commonwealth and
State purposes, I think that I proved in my speech at the secondreading stage-
– Order!I think I ought to remind the honorable gentleman that the committee has already decided this matter.
– But on a one-sided and, I believe, an insufficient argument. The plain fact is that if the Commonwealth chooses-
– Order! The honorable member may not canvass the decisions of the committee.
– Sir, the committee did not make any decision on the legality of the Opposition’s amendment. It merely decided that the amendment should not be agreed to. The committee did not have the functions or the capacity to decide whether the amendment was legal or not. All that the committee decided and could decide was whether it wanted the amendment.
– But the committee did do it, and committee business may not be debated in the House.
– All I am anxious to put is that the reasons advanced to the committee were not sufficient reasons. The plain fact is that if the Commonwealth chooses to disregard the Financial Agreement, then that is not justiciable. No court can compel the Commonwealth to raise loans, and when the Commonwealth declined to raise loans in accordance with the Loan Council’s decision, for several years consecutively, nothing was done about it by the States, because they realized that they could not compel the Government to raise the loans. On the other hand, if a State declines to pay its obligations in connexion with a loan, declines to pay instalments of interest or capital, its funds can be sequestrated or garnished. That was established in the early ‘thirties.
– I cannot see what this has to do with the bill. It is something that is completely divorced from the bill.
– It is relevant, I submit, to a consideration of whether this bill could legally have been amended in the way the Opposition advocated. The amendment was moved and was dismissed without an argument being heard on this subject.
– Order! The honorable member may not go outside matters relevant to a thirdreading debate on the bill. (Several honorable members rising in their places) -
Motion (by Mr. Davidson) put -
That the question be now put.
Question put. The House divided. (Mr. Deputy Speaker- Mr. G. J. Bowden.)
Majority . . . . 23
Question so resolved in the affirmative.
Original question resolved in the affirmative.
Bill read a third time.
In Committee of Supply: Consideration resumed from 2nd September (vide page 857-)
Proposed Vote, £2,582,000.
.- I wish to say a few words with regard to the Department of External Affairs, the estimates for which are under discussion. Far be it for me to introduce into a debate of this nature, on this subject of international affairs, any political approach. I feel, however, that this is an occasion that we cannot let pass without at least commenting once again on the fact that the Minister for External Affairs (Mr. Casey) is again absent from this Parliament during a most important debate. At this stage, we are again debating his department. The Minister representing him is probably a very eminent man in his own sphere, but he has no connexion with the Department of External Affairs. I think the most foreign man in this country is the Minister for External Affairs. He must be completely out of touch with home affairs, because he is so often absent from the Parliament when these discussions take place. He is seldom in the country long enough to get even the atmosphere or the feeling of the national approach to these problems and so fit himself to represent Australia adequately on international affairs.
– He is foreign to the nation’s affairs.
– That is a very apt interjection by the Deputy Leader of the Opposion and I thank him for it. I do not want to take up my short time by speaking at great length on the Minister’s absence, but
I feel that, in justice to his department and to himself, he should be here more often to give us his views and, above all else, to hear the views of honorable members on both sides on matters concerning his portfolio.
In the world of international affairs, Australia whilst contributing as it has over the years, particularly under Labour governments, towards the maintenance of world peace, should concentrate on the areas where it can do the most good. Our future is linked more closely with Asia and its future than with any other part of the world. This Government should concentrate on offering our real friendship and goodwill to Asia, and thus make a practical contribution towards the peace of this area and to the improvement of the standard of living and the welfare generally of these people. As I say, I do not want to introduce politics into a matter of this nature. However, when I hear honorable members opposite criticize the Australian Labour Party for its attitude towards Asia and international affairs generally, I do not need a very long memory to recall the criticism levelled at the Labour Government in 1945 and subsequent years for its contribution to the establishment of the United Nations. The “ Hansards “ of this Parliament and the press of this country are dotted with expression after expression from prominent members of this Government decrying the efforts and the work of the United Nations. I have a clear recollection of the Opposition’s criticism in the days of the Chifley Government of Labour’s efforts to spread friendship and goodwill amongst the Asian nations. Criticism came from Mr. Spender, who is now a judge of the International Court, and from other honorable members opposite.
We do not, therefore, want any pious lectures now from the Government on international affairs and the need for goodwill towards Asia. If anything could upset our standing in Asia and make Australia’s name most unpopular amongst the Asian people, it is the sending of our troops to Malaya and I think future generations will live to rue the Government’s action. That action could never generate goodwill amongst the people of Asia. Unfortunately, we may well pay dearly for the Government’s folly in sending the white man’s forces to fight in Asian countries where they are not wanted, despite what honorable members opposite may say.
I shall read an extract from “ Hansard “ to show that the Government has not always been as tolerant and understanding of the United Nations as it is at present, when the Minister is constantly there. During a debate on international affairs, the Leader of the Opposition (Dr. Evatt) said -
This Government is guilty of a lack of persistent and continuous faith in the United Nations.
The present Minister for External Affairs interjected -
Nobody takes any notice of it.
That occurred on 2nd April, 1957, and appears at page 421 of “ Hansard “ of that date. This attitude was adopted by other prominent members of the Government. The late Archie Cameron, the Minister for Trade (Mr. McEwen) and others have, according to the records, continually criticized these international organizations, and in that respect they have not always been contributing to Australia’s welfare as they should have been.
In perusing the estimates for the Department of External Affairs, I notice that the total amount provided for this year is £2,582,000. I am one who believes that our representation abroad, though it must necessarily cover some of the major nations, should be concentrated for our general welfare in those Asian countries which are close to our shores and which will, with us, play an important part in the future conduct of affairs in this part of the world. Our legations in countries such as Thailand, China, Burma, Viet Nam, Malaya, Singapore, India, Pakistan, Ceylon and Japan should be staffed with officers who will be able to bring to bear a real knowledge and understanding of our way of life and our approach to international affairs. If there is one section of the world in which Australia can play an important part it is in Asia. Our trade unionists should go there and show the people the Australian way of life and the methods adopted in trade unionism in this country. In other spheres, such as the economic sphere, Australia could make a major contribution, and the amount voted for expenditure in Asia should be large enough to enable people who understand the .problems to go there and give the Asian people a real appreciation of Australia’s approach to international affairs.
I notice that a fairly large sum is being provided for our representation “in Brazil and that representation in Indonesia will cost £77,000. However, the amount provided for representation in France and similar countries is much greater. I feel that the amount provided for European countries should be decreased so that the allocation for Asian countries could be increased. In -this way, we might be -able to put our point of view better and to make a bigger contribution to ‘the general welfare of Asian -people. As honorable members know, an amount is provided in -the estimates for salaries and allowances. The Australian Embassy in Indonesia, which is one of the most important countries to our north, is staffed by an ambassador, five External Affairs officers, two clerks and four secretary-typists. I may be misinformed, but I do not think so. I believe that there is no press liaison officer or .press attache in that important country. We do not know what type of work is being done by the five External Affairs officers. I mention this as an example of the possible lack of planning in the selection of officers for these posts.
The foreign service of the United States of America has such personnel as labour attaches who study labour affairs in the country to which they are sent. It has specialists in each field of activity. Although we cannot hope to compete with the United States of America on a world-wide basis because of financial and other considerations, we might well follow its pattern by appointing to .areas such as Indonesia specialists in labour affairs, for instance. Our representatives should be specially chosen for their ability to transmit to this country the information that we need and to disseminate throughout the country in which they are working a proper view of our attitude and accurate information on all aspects of their work. We may be lacking in this respect in some of these Asian countries.
Much has been said about .the appointment of career diplomats to overseas posts. I have nothing against the appointment of men who are specialists in their profession, and I say quite fairly that many career men in the diplomatic service at present, at home and abroad, are doing a notable job for Australia. But, like the appointment of a Governor-General or the Governor of a State, I do not think that appointments to the diplomatic service should be confined to any one section of the community. No one can deny that many men outside the diplomatic service, now and in the past, have rendered notable contributions towards the future of Australia by their representation of Australia in overseas countries. Who would say that the honorable member far Bonython (Mr. Makin) .did not do a good job as ambassador in Washington? Who could quibble about our representation in London by the late Mr. Beasley? I can say from my ;own observations that Mr. Paul Maguire ‘has .been doing a great -job in Rome. No doubt Mr. Beale, who was taken from politics and is not a career diplomat, is doing excellent work in his own sphere in Washington now. The point I make is that the appointment of diplomatic representatives abroad should never be made a closed domain by filling positions exclusively with people from the diplomatic service. That remark does not discredit the diplomatic service nor am I critical of the activities of its members.
From time to time I have made forays around the world and have had the opportunity of studying our diplomatic missions abroad. Some of them leave something to be desired, others are quite good. Last time I was overseas I went to the United Nations head-quarters in New York. I presented my card to the young Australian at the door who told me, subsequently, that he was about 30 years of age. I asked if I could see Mr. Walker and after looking at my card for awhile this young man said “ I don’t think he is in “. He further studied my card very closely and was obviously mystified at the letters “ M.H.R.” after my name. I am quite certain that he came to the conclusion that they stood for the words “ Many happy returns”. He did not have a clue. He told me he had not been back to Australia for some time. From his conversation I consider that he showed a lamentable lack of knowledge of current affairs in Australia.
We need to have people in these positions who know about Australia and understand its conditions. They must be people with practical experience and know why they are in these positions, whether they come from the career service or elsewhere. There is a wide field from which to choose and a practical way of making these appointments. I would never be a party to making our diplomatic missions a close preserve for people from the diplomatic service. In saying that, I am not slinging off at the “ long-hairs “ or professors, but I am drawing attention to the fact that people who may not have great learning but plenty of common sense often make in their own way a greater contribution to good representation of our country overseas. I summarize my few remarks by saying that I hope the Government will concentrate on providing the best possible representation among our Asian neighbours. I hope that the men and women appointed to our diplomatic missions will have a full knowledge of Australia’s economic and social position and also be able to approach the problems of South-East Asia in a spirit of goodwill. I hope that the Government will increase the number of scholarships offered to students from these countries so that they may be able to come here and learn our ways and methods. There should also be a greater exchange of visits between Australians and South-East Asians. Any criticism which the Opposition levels at the Colombo Plan is directed mainly at the administration aspect.
I am convinced that members of this Parliament, irrespective of their party political complexion, realize that the future of world peace depends on understanding among nations. Our problem in this regard is just to the immediate north of Australia. We are a white race in close proximity to countries populated by millions of Asians. No doubt there are various things which raise natural prejudices, but this calls for a tremendous effort on the part of our nation to promote further goodwill. We have already established goodwill to a great extent and we desire to maintain it. This can be achieved by bringing the right types of people here from the Asian countries and by our making grants to help their people improve their standard of living. As I have already said, scholarships and interchange of visits can play an important part. I feel that members of this Parliament should be given every facility to travel in these areas and so come to understand the people and the conditions in which they live. It is no use the Minister for External Affairs being the only traveller in the Government. Others want to learn about the problems of these people at first hand.
Having said these things in a quiet and non-political spirit may I say that I hope the Government, in the interests of world peace, will pursue a policy of peace and goodwill towards our neighbours in Asia. Members on the Government side criticize, in a narrow spirit, the attitude and policy of the Opposition on international affairs. May I remind them that it was Labour leaders such as Chifley, Curtin, Evatt and others who laid the foundation for good relations with many of the Asian peoples as well as those of other countries.
– Order! The honorable member’s time has expired.
.- I open my remarks by paying tribute to the work being done at the present time by the AttorneyGeneral (Sir Garfield Barwick) in his capacity as acting Minister for External Affairs. No honorable member would deny that since he has been serving in this capacity he has displayed a comprehensive knowledge of the problems of international affairs. He has applied himself to this work so diligently that he has gained added respect from every member of Parliament.
Members of the Opposition have made frequent references to the absence of the Minister for External Affairs (Mr. Casey) overseas. Last night the honorable member for Yarra (Mr. Cairns) made a positively ridiculous statement to the effect that the Minister for External Affairs should have stayed in Australia and been present while this debate on the External Affairs estimates took place, instead of attending most important conferences overseas. Every honorable member knows that it was on the eve of the closing of a very important conference in Bangkok of all our diplomatic representatives in the Asian region that the Minister left Australia so that he might be able to attend on the final day. People who have listened to the speeches which have come from the Opposition benches must realize that their criticism of the Minister for External Affairs and his visits overseas is unwarranted.
I agree with the honorable member for Grayndler (Mr. Daly) that South-East Asia is an area of utmost importance, lt was of supreme importance that the Minister should be in Bangkok on this occasion so that he might be given a comprehensive idea of the problems which confront our diplomatic representatives in that area. Therefore, to suggest that the Minister should have remained here to hear what the honorable member for Yarra and other members of the Opposition had to say is utterly ridiculous. Equally ridiculous is the suggestion of the honorable member that the times of the sittings of Parliament should be altered and also its periods of recess. He even suggested that the Parliamentary recess should coincide with the sittings of the General Assembly of the United Nations Organization. The honorable member has got these matters so far out of perspective that his views are not worthy of consideration.
During the last ten years the importance of Australia’s part in international affairs has grown tremendously and we now have a voice in many international conferences throughout the world. [Quorum formed.]
I had anticipated, Mr. Chairman, that the honorable member for East Sydney (Mr. Ward) would direct your attention to the state of the committee because, as is his custom, he indicated to Opposition members that he wished them to leave the chamber so that the number of members present would be reduced to the point at which he could bring the matter to your attention. The opportunity to reciprocate most certainly will present itself to-night during the debate on the motion to adjourn.
When I was interrupted by the honorable member for East Sydney I was indicating Australia’s increasing participation in world conferences and in international affairs. The situation is approaching rapidly when the Government must consider appointing a Minister-at-large who would hold a port folio concerned specifically with international affairs, and whose responsibility it would be to attend international conferences. At the same time, we would have in Australia a Minister who would be responsible for the administration of the Department of External Affairs. If we continue to take an increasingly active part in the affairs of the world, governments of the future will have to face up to the problem which, in my view, could be solved if my suggestion were adopted. As the honorable member for Grayndler has suggested, it is of supreme importance that Australia should move closer to affairs in Asia, because the future of this country is intimately bound up with the future of Asia.
Before concluding my speech I should like to refer to some statements that were made last night by the honorable member for Yarra in relation to the Colombo Plan and the economic aid that Australia is giving to the Asian countries. I do not think that anyone fairly could criticize the contribution that Australia has made under the terms of the Colombo Plan. The economic aid that we have given to Asia has proved of tremendous value to us. The name of Australia is becoming better known in every country of Asia, and increasing numbers of people are seeking more knowledge of Australia, largely due to the contacts that have been made as a result of our contribution to this scheme. Unfortunately, the number of Asian students that we are able to bring to this country is limited by our economic capacity. I should like to see a tremendous expansion in the application of the Colombo Plan, particularly in regard to the bringing of students to Australia, not only from those areas which come within the scope of the plan but also from other countries. This would bring only good results for Australia, particularly in the matter of our future relations with the young people of Asia who one day will control the welfare and destiny of their own countries.
It is supremely important also that we should send technical experts and experts in other fields to the countries of Asia to help them to establish their economies on a firmer and sounder basis. The criticism of the Colombo Plan by the honorable member for Yarra, last night, was badly based. He was deriding the constructive suggestions that had been advanced by the honorable member for Ballaarat (Mr. Erwin) when he claimed that we were giving economic aid to the militaristic and right-wing countries of Asia. I think those were the words that he used. I gathered the impression from his speech that the terms of the Colombo Plan should be extended to cover not only those countries which are now receiving aid - those countries to which he referred as militaristic and right-wing - but also to the peace-loving countries of Asia which he has been eulogizing in this Parliament. I am not sure whether he meant red China as the peace-loving country.
– If the honorable member is- not sure of- what I said, he should not quote me.
– I am not sure, because the honorable member was not explicit in his statements,, but I gathered the impression that he wanted to see the plan extended. He made specific reference to an agreement between the United States of America and the Soviet Union, which was designed to extend the programme of aid throughout Asia. If I am wrong in the impression that I have gained from the honorable member’s remarks, I shall welcome the opportunity to apologize to him. But I do not think that I am wrong. The honorable member referred to schemes that the United Nations Organization had dropped’ in” favour of the Colombo Plan - schemes that would have embraced the Communist countries of Asia. I remind the honorable member that, in answer to an interjection, he said that all the troubles in Asia had been brought about by social and economic conditions. In reply to my interjection: “ What about Korea? “ the honorable member again claimed that the situation in Asia was as he had stated, and that that situation had precipitated the Korean war,, in which case the United Nations and Australia were wrong: in. sending troops to participate in the combat that resulted.
I wish to refer now to Australia’s representation in: Asia-. Practically every honorable member in. this chamber has suggested that we. should- increase our contact with Asian countries. A perusal of the; list on page 14 of the Estimates of Receipts and Expenditure showing, the diplomatic posts which have been established, will show that there has been a tremendous growth in the establishment of diplomatic posts throughout Asia since this Government has been in office. Unfortunately, however, two very prominent Asian countries appear to have been, disregarded completely. One is the- Republic of Korea. I know that the Minister for External Affairs, as well as every person who has had any contact with Korea, is most anxious that we should establish a diplomatic post in that country. However, apparently the Department of External Affairs is being handcuffed by the Treasury which considers that it is not necessary to establish a diplomatic post in Korea, because we are in the fortunate position of having two Australian representatives on the United Nations Commission for the Unification of the Republic of Korea who are being paid by the United Nations Organization. The point seems to have escaped the notice of the officers of the Treasury that if we are to have diplomatic relations with Asian countries and if we are to establish diplomatic posts in those countries, it is of paramount importance that our representatives should enjoy the prestige to which they are entitled as representatives of Australia. In Asian countries this- is a matter of supreme importance. It is most embarrassing to go to Korea and find that the most popular of all the diplomats in that country is an Australian who is a member of U.N.C.U.R.K. I refer to Mr. Hugh Dunn. However, he is the most junior of the diplomats in that country because the Treasury has failed to see the. great value of establishing a legation in Seoul.
The Government, and particularly the Cabinet, should- take another look at the situation-.. I know that the Government of the Republic, of Korea, has been anticipating the establishment of an Australian, legation in that, country, and I know that it has been contemplating the possibility of, transferring its diplomatic representative from Sydney to Canberra. It has been waiting only for Australia to make- the- first move. Australia is a much wealthier nation than Korea, yet Korea is able to maintain a consul-general in Australia and a diplomatic post in Sydney of some proportion. But the Treasury has the effrontery to tell this
Parliament that it does not consider it necessary for Australia to have a diplomatic post in Korea.
I shall refer now to the Republic of China. We do not have a diplomatic post in that country but the United Kingdom Government, which recognizes Communist China and not the Republic of China, considers it essential to have a diplomatic appointee in Taipeh where, because of certain problems involved in the non recognition of the government, it has appointed a representative in that country. He is not fully accredited to the government, but only to the Governor of the island. So Australia has again failed to recognize that it has some responsibility to establish a mission in this country.
The CHAIRMAN (Mr. Bowden).Order! The honorable member’s time has expired.
.- The estimates for the Department of External Affairs as they are set out on page 14, in my opinion, do not accurately convey to the committee the expenditure of that department. I propose to say something about that question later on. Before proceeding to dp that, I should like to make some observations on some of the statements of the honorable member for Lilley (Mr. Wight). The honorable member devoted a considerable amount of his time to criticizing an alleged statement by the honorable member for Yarra (Mr. Cairns). Among other things, he claimed that the honorable member for Yarra had been critical of the Colombo Plan.
The honorable member for Yarra was not critical of the principle of the Colombo Plan. He was critical of the methods employed in the distribution of funds under that plan. I think that almost every member of the Opposition who has taken part in this debate supports that point of view. A growing number of people are asking themselves whether the amount of money that we are spending on the Colombo Plan is being spent in the best way. I, myself, believe that there are greater advantages to be gained from methods other than those that are being employed at the present time. In many instances shipments of goods to different places in Asia have been wasted, according to reports that have come back to this country.
I think that if we were to concentrate on two aspects of the Colombo Plan, the educational and the economic aspects, we would achieve greater results than we are achieving at present. I know that the word “ economic “ covers rather a wide field. But I believe that if we were to send food into these areas it would do more good than some of the gifts that we are sending at present. Almost threefifths of the peoples of the world go hungry every night and, insignificant as our contribution of food might be, 1 think it would bring a greater measure of relief than some of our present shipments. It is on that basis that the Opposition criticizes the Colombo Plan on the methods being employed, not on the plan itself.
During the course of this debate, some Government supporters have twitted members of the Opposition on their failure to accept the invitation to join the Foreign Affairs Committee. I think it is as well to point out that the Foreign Affairs Committee is purely a Government body. It has been set up by the Government and it is exclusively a Government affair. Government supporters have said that if we were members of the Foreign Affairs Committee we would be supplied with some of the information that we are now seeking. If that is so, I should like to know how the Government or the Minister for External Affairs (Mr. Casey) can justify a situation in which members of a committee of this Parliament are given information that is withheld from members of the Parliament itself. Have we reached the stage in this Parliament at which a Government controlled committee is supplied by the Minister for External Affairs with information that he deliberately withholds from this Parliament? In effect, this Foreign Affairs Committee has supplanted Parliament.
It is interesting to examine the attitude of the Government to that committee. It was quite obvious that the Government wanted the Opposition to join the committee on the Government’s terms, thinking that some advantage might be gained from that. However, the Government is not always so anxious to have an all-party committee. During the latter days of the Curtin Government and under the Chifley Government an all-party committee of exservicemen existed. It functioned until the defeat of the Chifley Government in 1949. But when the present Government assumed office in 1949, it set up its own committee and deliberately excluded members of the Opposition. We were not invited to join this committee of ex-servicemen. I have not the slightest doubt that the reason behind that action was that the Government thought that the affairs of ex-servicemen should be its own exclusive preserve so that it could gain some political advantage. If the Government wishes to be consistent, 1 suggest that it should look at its attitude on that matter.
Foraging through the Estimates, I find that the proposed votes for the Department of External Affairs are to be found, not only on page 14, but on page 24, page 35, page 50 and page 58. All those pages contain some items that relate to the Department of External Affairs. Oddly enough, on one page the expenditure of this department for the financial year, 1959-60, shows an increase of approximately £3.000,000. Last year, in round figures, this department cost the country approximately £8,000,000. The total proposed vote for the department this year is £11,000,000. I think that we are entitled to know the reasons for the increase.
There are a number of matters in the estimates for this department that appear odd to me. Approximately 24 embassies, legations and high commissions are listed on page 14. Of these, twelve are in Asia and the other twelve are in Europe and South America. It is interesting to notice that these estimates do not take into consideration the cost of the office of the High Commissioner in the United Kingdom which is £868,000. The total cost of the twelve offices in Asia is approximately £625,000. The other twelve embassies and legations in Europe and South America cost £778,000. So the Government is committed to spend more on the office of the High Commissioner in the United Kingdom than we are spending in Asia, Europe or South America! I was surprised to find that our ambassador at The Hague gets £5,000. He appears to be our highest pal , representative. Our ambassador to the United States of America gets roughly £3,750. It is true that he receives a like amount as our ambassador to the United Nations but I think that we are entitled to ask why our ambassador to such a place as The Hague is paid such a large amount. 1 am rather inquisitive about the expenditure of this department relating to buildings but I can find nothing in the Estimates on that subject. Two or three years ago, a* a result of an investigation by the Public Accounts Committee, the Department of External Affairs was taken to task very severely by the committee concerning a building that the department had erected at New Delhi. It was even suggested at that time that a standing committee of the Parliament might be sent to investigate what had happened. But the Minister very dexterously pushed the matter into the background. As I have indicated, there is nothing in these Estimates about the abnormally large amount spent on the building at New Delhi. I support the sentiments of some honorable members who have suggested that we should have more representation in Asia. I have given to the committee the comparison of costs of our legations and embassies throughout the world. We are a part of Asia and whatever happens there will become increasingly important to us.
I am not suggesting for one moment that the centre of gravity of power politics has moved from Europe, but it is quite apparent that Asia to-day is completely different from the Asia of 50 years ago. Then it was regarded by the powers of the world as something to be exploited and it was exploited mercilessly. To-day, the picture is completely changed. Whether we like it or not, nationalism has awakened in Asia and is on the march. Nationalism is a legitimate aspiration. It is acknowledged that the nationalism which is manifesting itself in different parts of Asia is being exploited by certain people, but that does not detract from the fact that nationalism is a legitimate and human aspiration. Why we should centre more of our activities there should be apparent to everybody from the situation that is becoming so clear in Asia.
No matter what we do, we cannot help or hinder what is happening in Europe, and I do not suggest that we should withdraw our interest from Europe. What is happening there is simply what has been happening for the past 100 years. The tactical battle of the balance of power is still being fought there. For reasons that are self-evident, England has been compelled to withdraw some of her interests from Asia and centre them on Europe. In the past, we have been forced by circumstances to rely greatly on the United Kingdom, but its policy is such that assistance from that direction is no longer available. We have to look around for new friends. As a result of the withdrawal of the United Kingdom from Asia, we have additional responsibilities there. In many cases, we have replaced the United Kingdom. It is of the utmost importance that we redouble our interest in Asia. We live in Asia and whatever happens there is of vital interest to the welfare of Australia.
.- The honorable member for Dalley (Mr. O’Connor) is to be congratulated upon having actually spoken about the Estimates. That is becoming increasingly rare in this chamber. The honorable member spoke of the differences in salaries paid to Australia’s representatives overseas. In particular, he compared the salary paid to the Ambassador to the United States of America with that paid to the Ambassador to the Netherlands and the Ambassador to the United Nations. If honorable members look at the section of the Estimates beginning at page 161 they will find that the Ambassadors are paid different scales of allowances. It is curious that the Ambassador to the United Nations should be paid £1 a week more than the Ambassador to the United States of America, in Washington, whereas the allowances for the Ambassador in Washington are about double those of the Ambassador to the United Nations. Across the border we find that the Australian High Commissioner in Canada is paid more than the Ambassador to the United States of America or the Ambassador to the United Nations. So, Dr. Walker’s salary is £1 a week more than that of Mr. Beale, but Mr. Beale enjoys twice Dr. Walker’s allowances. There seem to be a few quirks of accounting which do not suit the relative importance of the offices concerned and certainly do not measure the take-home pay of the ambassadors. The more they get in allowances and the less in salaries, of course, the less taxation they pay.
The honorable member for Dalley mentioned the Australian High Commissioner’s Office in London. He mentioned how much more was spent there than on our posts in Asia. Earlier in the debate, the honorable member for Bonython (Mr. Makin) spoke on yet another matter which is of some importance. He has harped on it before. It was this: Why is the High Commissioner’s Office in London under the control of the Prime Minister’s Department whereas the others are all under the control of the Department of External Affairs? [Quorum formed.] As I was saying before the audience in the chamber became somewhat more inflated, there is a very good reason why the High Commissioner’s Office in London should be under the control of the Prime Minister’s Department rather than that of the Department of External Affairs. It must be remembered, however, that the Department of External Affairs retains in London a very senior officer who has quite a large staff and fulfils the duties concerned with external affairs similar in character to those performed in other countries by that department.
The real reason for the different control is that Australia House is, in a sense, a reflection of every government department in Australia. There are numerous people there who are responsible to a particular Minister, and of the 600 or 700 who work at Australia House only a very small number are concerned with anything that might be termed foreign or international relations. The rest are pursuing the ordinary job of government in a way and on a scale which is much more parallel to affairs conducted in Canberra than at other overseas posts. Undoubtedly a considerable burden would be added to that already borne by the Department of External Affairs if the department had to undertake ancillary functions such as immigration, Treasury work, supply and many other widespread functions, none of which is really relevant to the duties which should be performed by the department.
I have had reason before to ask the Minister for External Affairs to look into the question of providing in Canberra a suitable establishment where he or the head of the department and other senior officers could . offer appropriate hospitality to visiting dignitaries, and also to diplomats stationed in Australia. The Minister said that he would , look into this matter, and I hope that the Attorney-General, who is now acting for him, will give some answer to this question when he replies at the end of the debate, as this is a most important matter dealing with a gap in our current arrangements. It is not worthy of Australia that when overseas dignitaries - political, official and otherwise - visit Canberra, the only place for entertaining them, apart from Parliament House itself, is a public hotel which is open to everybody. That seems hardly a fitting site for entertainment by the government of such a country as Australia, when the governments of other countries which operate on a much smaller scale than ours, provide appropriate establishments for fulfilling this function.
Another present deficiency in the administrative arrangements of the Department of External Affairs concerns the teaching of languages. The same motives apply to the learning of languages as apply to most other human affairs - that is to say, a monetary reward can play a very important part in it. It is true that officials of the department are paid higher allowances when serving in foreign posts if they know and can use effectively the language of the particular country to which they are posted; but when they leave that country, to which they may not return for many years, they lose the extra allowance.
It seems important, Mr. Chairman, that there should be a strong and continuing financial reward within the department for efficiency in languages. Apart from the continuing advantages, we must also consider the personal cost of learning a foreign language in a post overseas. [Quorum formed.] I understand that when an official of the department working in Australia wishes to learn a language the necessary arrangements are made, and the cost is covered by grants. If that is not the position, then it should be made the position. There is also the question of officers posted overseas having to bear the cost of learning a language. Surely, Mr. Chairman, that cost ought to be borne by the Government.
Again, I believe that some small grant is made towards the cost, but such inquiries as I have been able to make reveal that it is quite an inadequate allowance and covers only a small part of the cost of lessons.
In the course of his remarks the honorable member for Grayndler (Mr. Daly) referred to our troops in Malaya. All I would like to say on this is that our troops in Malaya, whom I visited recently in company with the honorable member for Higinbotham (Mr. Timson) are first-class ambassadors for Australia. Their relations with the local population are extremely good, and they do bring home to the people of Malaya the existence of Australia, in a way in which any number of external affairs posts would be quite incapable of doing. If, in fact, honorable gentlemen opposite are so keen on promoting good relations with Malaya it might be more appropriate if they piped down a bit on the desirability of unifying Singapore with Malaya, because whatever else they might do, they would have a long distance to go to make up for the ill-will that would be aroused by trying to thrust this solution for Singapore on to the people of Malaya.
The honorable member for Kingston (Mr. Galvin) stressed the importance of concentrating, in our programme of aid to Asia on technical aid rather than capital aid. This is surely a very valid point. It is a fact that the mere export of such capital as Australia can provide to the countries of Asia can make only a negligible contribution to the improvement of our relations with them, because the gift of that capital is known to a very few officials in the recipient countries, whereas the provision of technical aid enables us to get to know large numbers of individual citizens, who also discover what we are doing for them and something about conditions in this country.
Tt is probably true that development depends far more on technical know-how and skill, and on the gradual permeation of the whole life of a country with improvements in different directions, which make ultimately for a higher standard of living, and there is no real short cut to be had by merely pumping in additional capital. This capital, this foreign aid on a large scale which so many honorable members advocate could, in fact, very shortly offset any benefits that we might gain from raising loans overseas. We already have a considerable drain on our resources in the shape of New Guinea and Papua. That Territory can readily become an economic and financial ulcer for Australia, and we should be extremely careful about adding to our burdens when our prior and nearest responsibility is one that is going to become extremely difficult and more onerous to discharge. Therefore, I think that as far as possible we should take heed of the wise remarks of the honorable member for Kingston.
– Order! The honorable member’s time has expired.
.- It was not my intention to speak on the estimates for the Department of External Affairs. One of the regrets that I have about these debates is that once they get under way and gain some tempo there seems to be a tendency on the part of some people to discredit and distort the remarks of some honorable members on this side of the committee. That is no new thing. If you go back over the years you will find that we have always had smear campaigns in an endeavour to discredit the opinions of others. When the eight-hour day came into being there was considerable reaction against it. Many people wielding political and industrial power tried to prevent the eight-hour day from being introduced, but to-day nobody argues against this great industrial advance. There was a time when social security was spoken of as being very revolutionary. There was a time when people who could well afford to do without pensions were given pensions, but those who needed pensions were told that such an idea was too revolutionary.
That brings me to some of the remarks made by the honorable member for Lilley (Mr. Wight). He referred to the speech of the honorable member for Yarra (Mr. Cairns) and in doing so he distorted what the honorable member for Yarra had said. The honorable member for Yarra said that he felt that if any progress was to be made in the underdeveloped nations it would be mainly brought about by an improvement in the social and economic conditions of those countries. He said that he felt that economic co-operation would be more beneficial to those countries than military co-operation. The honorable member for Yarra also referred to the Colombo Plan.
I have with me the text of a radio and television talk between President Eisenhower and Mr. Macmillan on 1st September this year. That talk supports the argument of the honorable member for Yarra. The text of it has been supplied to me by the United States Information Service. In it the Prime Minister of Great Britain, referring to a summit conference, said -
I agree. But, of course, we are talking now about the two great groups, the Communist group and our group. But there are lots of other peoples in the world too, countries outside, some of them not yet fully developed, some of them a bit backward. What about them, Mr. President?
The President of the United States then said -
I believe in a sense that the problem of the under-developed nations is more lasting, more important, for Western civilization than is this problem of the Soviet-Western differences.
There are one billion, seven hundred million people that to-day are living without sufficient food, shelter, clothing and health facilities. Now they are not going to remain quiescent. They are learning something about their own lot, and they are comparing their lot with ours, sitting here this evening. They are just going to have an explosion if we don’t help. I believe the biggest co-operative job that all the world that calls itself civilized, including the Soviets, ought to address themselves to is this problem, and on a co-operative basis help to solve it, so that these people can achieve their legitimate aspirations. And that is the problem that every one of us must address himself to and see what we can do, what our proper part is.
That address is a vindication of what the honorable member for Yarra has said. It is very evident that two of the great men of the world to-day - the Prime Minister of Great Britain and the President of the United States - think along exactly the same lines as the honorable member for Yarra. They believe that the difficulties in the underdeveloped countries cannot be overcome by guns.
– They are advanced thinkers.
– They are. I do not claim to be an advanced thinker but I do believe that we could use much more tolerance in our discussions than I have seen exhibited here to-day. We are probably living in a time of the greatest development in technology in history. As many other honorable members have said, I believe that we should give more thought to the under-developed nations, particularly those in Asia. Those countries present a great challenge to us. I believe also that in some ways we should revise our thinking with regard to the Colombo Plan.
I had the privilege of passing through India on my way to the Commonwealth Parliamentary Association conference and what I saw there made a very great impact on my thinking. I saw some incredible things. The honorable member for Yarra spoke about the Colombo Plan. In India I saw machinery that had been sent, most probably from this country or from some other country operating under the Colombo Plan, rusting in the fields. I also saw some of India’s starving millions. It is no exaggeration to say that in India people are conceived in the streets and born in the streets. They eat - when they can get something to eat - in the streets. They sleep, live and die in the streets without knowing what it is to have a decent rag to their backs or a home in which to live. These are the things to which we should address our minds. I think that we should confine ourselves to seeing what we can do about hospitalization and housing for these people. Our attention is especially drawn to India at the moment because of events there that could break out into a conflict of major importance. After having seen the terrific soil erosion I think that there is a great need for this country to send soil experts and agricultural experts to India. When you see the unhygienic conditions under which the people are living in India, there can be no doubt that sewerage engineers and civil engineers are urgently needed there.
We very often refer in. this place to matters that should be taken to the United Nations. We hear of conflicts that have broken out between various countries; but we do not hear very much about what is happening in the under-developed countries. What is happening in those countries is assisting the spread of communism and their plight should be discussed at the United Nations. I particularly wish to direct attention to a practice in India known as preventive detention. Hundreds of people are still languishing in gaols in India await ing trial for political offences. We in thiscountry pride ourselves on being a democracy. In this Parliament we upbraid and abuse one another instead of attempting todelve into the problems that are of great moment to the peoples of other countries and which any democratic country should be ashamed to allow to continue.
The honorable member referred to theColombo Plan. When I was in Pakistan, and India, I was told that much of the material that is sent from Australia under that plan does not go to the people whoshould get it, but is allowed to fall into other hands. Here is what the American magazine “ Time “ had to say about Pakistan -
The land that Ayub took over five months ago was so corrupt that even such tolerant agenciesas CARE and the Catholic Relief Services had given up on it; gifts clearly labeled NOT TO BE SOLD invariably ended up, not in the hands of the hungry, but in the hands of the blackmarketeers.
These are the things on which I think we should express our thoughts, Mr. Temporary Chairman. These are things to which we should give a lot of attention. We should devote our time to investigating them thoroughly instead of to abusing one another over our respective attitudes towards international affairs.
The magazine went on to say -
In one province the Ayub government found 300 people still awaiting trial after being arrested as long as three years ago.
Is that justice? Is not it definite, Mr. Temporary Chairman, that we and Government supporters can help by pointing out the inadequacies and the social injustices involved in these things? We could do more to help the people in those parts of the world by pointing out these things rather than by talking about bread and cheer, and things of that kind. We could help them more if we practised democracy instead of adopting great slogans about it. “Time” magazine stated also, that the Pakistan Government had reclaimed 16,000,000 dollars from private illegal holdings of foreign exchange, and had found two tons of gold that had been hidden. The magazine went on to tell of many other things. It is quite apparent, Mr. Temporary Chairman, that, although we talk about international affairs generally and about conditions in the countries of Asia in particular, we do not say much about what we propose to do to improve the lot of the people of those countries and to remove the conditions that are, essentially, the seed beds of communism.
I should like to refer the committee also to an article published in a journal which could not at any time be construed as leaning towards Labour policy. On 19th March of this year, a well-known newspaper published an article written by Denis Warner, which stated -
For years India watched Communist China with neighborly friendliness. Mr. Nehru realised that his problems of poverty, hunger and illiteracy were also China’s problems.
The article went on to state that the Indian Prime Minister sent an official to China to investigate the situation there. The article then described the conditions in China reported by this official on his return in these terms -
Here everybody is guaranteed clothing, food, housing, transport (from home to work), maternity benefits, free old-age care, free funeral and burial, free education, a small marriage grant and a free reception for the couple, twenty free hot baths a year-
People in other places, too, could do with a few of those - free care of children, free recreation, free tailoring, and free electricity.
This Indian official thought that that sounded very good, but he observed that human beings were reduced to the level of inmates in a zoo. Warner then posed the question whether life in a hard-working zoo with food was not better than the liberty of the jungle without it.
– Order! The honorable member’s time has expired.
, at the outset of his remarks, that there was a tendency for Government supporters to misconstrue and twist the meaning of remarks made by Opposition members. Although I disagree with the honorable member’s conclusions in detail, I give credit to him for an observation which, in itself, was indicative of a proper approach to the subject before the committee - the estimates for the Department of External Affairs. However, I remind the honorable member that the honorable member for Grayndler (Mr. Daly), one of his colleagues, in a very voluble speech a short time ago, remarked that the sending of troops to Malaya was not likely to create goodwill among the Asian people. I consider that to be an exceedingly irresponsible statement.
I think it is about two years since I visited Malaya as a member of a parliamentary party returning from a conference of the Inter-Parliamentary Union which was held at Bangkok, in Thailand. It is quite true that in the circumstances of our visit, it was not possible to obtain a detailed and long-range view of the reactions of the Malayan people to the presence of Australian forces. But the Malays, the Chinese-born Malayans or Malayan Chinese - whichever one chooses to call them - and the members of the Indian community, who number some 600,000 persons, now rule their own country, and they certainly did not indicate in any way that they were anything but most grateful for the action of Australia in contributing forces to suppress the terrorists who ranged the countryside.
Through my own family, I had a link with Malaya, and I know that the government of the day in that country had to move people who had settled in certain areas where they were fair game for the terrorists away from those areas. Whether or not the sympathies of these people lay with the terrorists, they were forced, under threat of death, to contribute to the upkeep of the terrorists forces. As a consequence, the Malayan Government, in concert with the United Kingdom Government, had to re-settle these people in other areas, and provide health, educational, hygiene and other services. This, in itself, was a major task.
In Malaya, the Government was confronted not only by the manifestations of those who were actively and viciously applying the Communist theory of liquidating all who opposed them, but also by something that is common in every country in which there is complete destruction, for the time being, of the original authority of government - the appearance of people who call themselves patriots or describe themselves in some other way. The activities of such people represent only a recrudescence of forms of banditry and robbery that have appeared on almost every occasion of civil upset throughout the world. The fact remains that, had it not been for the valuable assistance given by Australia through its contribution to the Commonwealth Strategic Reserve, the task set the Malayan Government in the formative stages after the granting of independence would have proved too heavy for it.
I think it is a great pity, Mr. Temporary Chairman, that the honorable member for Grayndler should so lightheartedly throw off a sentiment such as the one he expressed, which may tend to hurt, and certainly may tend to disturb, members of our community who have, either personally or through members of their families, contributed towards our defence, and are contributing at the present time.
T visited the military establishments in the Near East, and I visited the airfields. 1 saw the places where our people are housed. I also saw something which must have been a revelation to many of the Malayan people. I saw a corps composed of our young fellows busily constructing an airfield. In spite of all the misleading statements to the effect that men could not live in the tropics without wearing big helmets, most of these young fellows were bare-headed and bare-necked. They wore the minimum of clothing - a pair of shorts, an open-necked shirt and a pair of boots - and they were giving an extraordinarily fine demonstration of teamwork in the construction of the Butterworth airfield.
I have never seen fellows work better. They all pulled their weight, whether on the concrete-laying machines, on the feeding machines, or on the tractors. There is not the slightest doubt that it was a revelation to many of the people of Malaya, who had not seen white people work in this vigorous fashion, to realize that here was a community that did not consider that it lowered a white man’s dignity to work as well as he could at manual labour or at the operation of machinery. In this respect. I believe that we gained much ground among the people, who could understand that a new breath of air was being brought into what had been a colonial administration.
I refer to this matter, Sir, merely because of a remark made by an honorable member opposite that was quite beside the point, and was, in my opinion, entirely uninformed, and might have tended to mislead persons outside this chamber who heard it.
I just want to say something in reply to those who have raised the question of the Minister’s absence abroad. It is quite true that the Minister for External Affairs (Mr. Casey) has spent much time abroad, and that his appearances in this chamber have not been as frequent as we would have liked. But the fact remains that these are disturbed days. We have a Minister who is extremely well-informed, and who, in fact, I believe, was originally instrumental in the formation of the Department of External Affairs. He is persona grata with many people throughout the East, and he is well known elsewhere. I believe it is rather cheap to criticize the Minister for not being here, when his own technical officers can give the fullest information, if it is required. The Attorney-General (Sir Garfield Barwick), who is acting for the Minister, can be supplied with this information. I think it is of great importance that the Minister should attend these councils abroad, where he can do the most good for this country.
Let me suggest that honorable members should give careful consideration to the situation in Laos. We should give attention to the threat to South Viet Nam, which is a pretty sturdy country and is trying to hold off the same kind of a flood that destroyed the liberties, shall I say, of the Koreans in the north and is now trying to envelop Laos. We should remember also that on the borders of India there is a threat poised, and that associated with it are, I believe, horrors that we have not yet begun to comprehend. I read a report recently, which I believe was signed by an eminent Indian legal man, of a committee that inquired into the charge of genocide in Tibet. This committee soberly made a finding that at least 63,000 persons had been destroyed, and great masses of others had been ruthlessly dispossessed of their belongings and forcibly shifted from one place to another. The report stated that at least 3,000,000 Chinese had been brought into that country, and that the military forces there were crushing the soul out of the people. Having these things in mind, I believe there is every reason for the Minister charged with the administration of our external affairs policy to be present at the places where he can discuss the possible implications of these situations with fellow members of the Commonwealth of Nations.
These reported happenings seem so utterly unrelated to the normal life of this community that we ourselves might say that they cannot happen here. I, personally, do not believe there are enough unstable, wicked or misguided people in our community to bring such things about. There are, I believe, those in our community who would like to bring them about, but they are a negligible quantity and have not the capacity to do so as long as we continue to try to run our community efficiently. To us it seems incredible that such things can happen, that one nation can move in upon another with the intention, not to persuade or encourage those in control to remove abuses, but, by sheer overwhelming force, to blot out practically a whole people. It seems incredible. It seemed incredible to us in the case of Hungary, a short time ago, on the other side of the world.
Yet there is an ever-present threat of these things. The brutality that slumbers in some sections of the human race is unleashed again and again, and it behoves us to have the fullest information possible from the man who is responsible to this Parliament and the people for finding out, not only what has been done, but also what we are likely to have to face in the future. So I dismiss this charge against the Minister. I think that wherever he is at present, he is doing a remarkably good job, and for the sake of Australia I hope he continues to do so.
I pass on to another matter that has been mentioned, the question of language training. It has been made to appear that the Department of External Affairs is at fault in this regard. I believe, Sir, that there is more to it than that. I am more or less acquainted with what is being done to try to encourage the learning of languages in that department by its officers, both here and abroad. This community has not yet shown that it has the imagination necessary to authorize the expenditure of an adequate amount of money for the learning of foreign languages by our young Australians, particularly the dominant languages of the East, such as Russian, Chinese and Japanese.
– Order! The honorable member’s time has expired.
.- I regret that I must make a second contribution to this debate, but one or two points require an explanation and I want to bring them briefly to the notice of the committee. The honorable member for Wentworth (Mr. Bury) made a statement this afternoon which may not have been noted by the AttorneyGeneral (Sir Garfield Barwick), who is representing the Minister for External Affairs because he was preoccupied at the time. The honorable member said that the position of our representative at the United Nations ranked higher than that of the ambassador in Washington and that the salary paid to our representative at the United Nations was higher than that paid to the man who occupies our chief diplomatic position in the United States of America. Of course, it may be said that the allowance received by the ambassador rather compensates him for that position, but that is not so. He is required to maintain the embassy on a scale that I feel is not required of our representative at the United Nations and he is responsible for the maintenance and provision of all the domestic staff for the official residence at Washington. The allowance does not in any way add to the salary that he receives.
The second point I wish to mentionis that we seem to have overlooked entirely one part of the world in our diplomatic representation. Yet, during the time that I was in Washington, this was regarded as one of the most important parts of the world to Australia, because it was our gateway to the European theatre. I speak now of the Middle East. Except for our representation in Israel, practically no provision is made for our representation in the Middle East. I found that a considerable amount of goodwill to Australia was generated by the efforts of the former Minister for External Affairs, who interested himself in the claims of these countries as they came before the United Nations and also visited certain of them. I found exceptional goodwill in such countries as Egypt, Lebanon and Turkey; yet we have heard nothing from the Government about Australia’s representation in this area. This is an important and strategic area and I feel that we should cultivate good relations with the people who live there, as well as with people in other parts of the world.
I was really astounded to hear the statement made - I do not in any way challenge it because I am afraid it is all too true - that half of the children of the world have never tasted milk and that the same number has never had the benefit of drugs or medicines. That is a shocking and terrible situation. These children should not be denied the articles that are so essential to their well-being. I hope that our efforts in support of the United Nations Children’s Emergency Fund will be redoubled and that there will be a magnificent response by this and other nations so that the situation may be corrected at the earliest possible moment. We must afford to the peoples of the world, particularly to the children, far better consideration than they have apparently been receiving.
– I understand that I was criticized last night for not taking part in this debate. I merely reply that, having previously had two opportunities to speak, I thought that 1 should wait until other honorable members had spoken before I used what authority or priority was due to the chairman of the Foreign Affairs Committee to deprive others of their rights. I have been very interested in what has been said, particularly in the continuous carping criticism that has come, not from all but from most Opposition members about the Foreign Affairs Committee. The honorable member for Melbourne (Mr. Calwell), who was most scathing, said - if one were to listen to these bright boys from this foreign affairs study circle, after their latest lecture by a diplomat, one would imagine that the collapse of the whole of western civilization was imminent.
All I can say is that I wish Opposition members would join the Foreign Affairs Committee. If they did not think it was of any value after their experience on the committee, they could always resign from it, but to criticize something that they refuse to join and about which they know nothing at all is just playing at politics with a vengeance on matters that are of extreme importance to every one in Australia. After all, how can any one who does not study the facts come to any conclusion which would be in the best interest of his country? Unfortunately, to-day all too many people make their decisions on important matters of international affairs on a basis of what might be called haphazard hunches. I said to a person who recently was supporting very strongly the recognition of red China, “Why do you feel that it should be recognized? Do you know anything about the facts? “ He said, “ No, 1 just think that it would be a good idea “. Maybe it would be a good idea after the facts had been studied, but he had not studied any facts at all. Therefore, debates on international affairs are of very great value.
Like other honorable members on this side of the chamber, I want to add my meed of praise - and fulsome praise it is - of the work that is being done by the Minister for External Affairs (Mr. Casey). In developing the Department of External Affairs, building up its staff, which is not easy, and establishing post after post, particularly in neighbouring countries, he has done a most excellent job. It is unfortunate, I agree, that he is not here when these estimates are being debated, but, as the honorable member for Perth (Mr. Chaney) suggested last night, in this day and age a Minister for External Affairs must travel. I know that the late John Foster Dulles was criticized by some unthinking people in America because he was frequently away from that country. However, where a Minister must travel in this way, we should perhaps consider appointing a junior Minister to assist in the administration of the department and perhaps to act for the Minister while he is away. [Quorum formed.] I was saying. Mr. Chairman, that it is unfortunate that the Minister for External Affairs should be away at this time, but it is desirable that he should be at the opening and early stages, at least, of the meeting of the United Nations General Assembly.
I should like to join with the honorable member for Corangamite (Mr. Mackinnon). the honorable member for Wentworth (Mr. Bury) and, I think, the honorable member for New England (Mr. Drummond) in directing attention to the difficulty experienced by members of the Department of External Affairs in becoming proficient in foreign languages. When we consider the way in which this department has been built up in a very short space of time it was almost non-existent in 1945 I think we all will be prepared to say that a very excellent job has been done. Unfortunately, I think the Public Service Board does not realize the importance of proficiency in foreign languages and that the incentive given to members of the department to become proficient in that direction is altogether too small. When we compare it with the incentive that was given to British soldiers in India before the war, it is almost ridiculous.I suggest to the acting Minister for External Affairs that there should be no question about members of the department having to pay for tutoring in those languages and that sufficient financial incentive should be given for many more members to become proficient in the languages of the countries which lie close to our own coast.
Another matter I should like to mention is this: I feel that, if we can afford to provide our Public Service chiefs with luxurious suites in the Waldorf-Astoria Hotel when they are in New York, we should adopt a wider view in regard to the accommodation that is provided at some of our legations in countries which have very difficult climates. Not so long ago I visited a legation in one of the very hot tropical centres where seven people were working in a nonairconditioned room. Although ] understand that state of affairs has been corrected. I do not think that kind of treatment is good enough. I do not think we pay enough attention to medical service and to the regular inspection of our people in countries in which are to be found several tropical diseases. I know of one foreign service which flies out immediately any officer who is found to be suffering from amoebic dysentery or ills of that kind. He is given sick leave at home until he is cured, and is then flown back. In many ways we could spend a little extra on the men and women who are living in those areas and who are doing work of incal culable benefit to Australia and those of us who sit in this Parliament. I have the highest regard for the representation that we have in these various countries.
Like the honorable member for Bonython (Mr. Makin), I cannot understand why the High Commissioner’s Office in the United Kingdom is still under the administration of the Prime Minister’s Department. I think that is one of our last outposts of empire. Such an arrangement goes back to the days when we had only one representative overseas, and he was in London. Perhaps our representation in London has greater emotional significance, but I doubt whether it is of greater importance than our representation in Washington. In my opinion, it would be much better to have the Office of the High Commissioner in the United Kingdom transferred to the department to which it really belongs namely, the Department of External Affairs.
I know the department is very short of staff at the present time, but I think it would be advisable for us to resume our representation in Cairo, which was broken off during the tragic days of the Suez affair. I was one of those who thought we erred on that occasion, but now that is over, and I should like to see our office re-established there. I shall go one further. I know a lot of people think I am a bit of a fanatic about it, but I would still like to direct the attention of the acting Minister for External Affairs to the fact that the only place in the Far East where we have no diplomatic representation is Taipeh.
– What about Peking?
Sir WILFRID KENT HUGHES.Peking says we can have representation there, but only on the condition that we completely sever connexion with another free country Taiwan. Peking has laid down that condition, and is using it as a political weapon. When Peking changes its attitude, and many other things too. we can have a look at the situation. But some people on the other side of the chamber want representation in Peking and not in Taipeh. In other words, they say, “ Desert your allies. Desert the free nations and get representation in Communist countries first.” I do not subscribe to that approach; I approach the matter from the other direction.
Yesterday, the honorable member for Yarra (Mr. Cairns) said -
The only way to remove those causes of trouble is to remove the social and economic problems. . . Let me say that as far as those countries are concerned, their economic problems are not being solved. Those countries are to-day living on American aid, just as in the case of Taiwan, and conditions are not developing indigenously which will provide a suitable basis for political security.
I do not think the honorable member could have been there. If he had, he would understand that one of the economic troubles in Korea is North Korea, and that one of the economic troubles in Viet Nam is Viet Minh or North Viet Nam. In Taiwan, there is to be found the highest standard of living anywhere in Asia. So far from Taiwan’s economic problems not having been solved, conditions there are developing better and better every year.
– They are subsidized.
– They are. but most of that subsidy goes into defence; very little of it goes into the ordinary budget. If the honorable member for Werriwa were to look at what has been done with it, he would agree that an excellent job has been done.
– He has a brief for the other side!
– Never mind about that! I am not accusing him of having a brief for the other side. What I am saying is that, if we are really fair dinkum in what we say about the free countries of SouthEast Asia and the western Pacific we should consider the question of representation in Taipeh, and not ban every Minister who travels from visiting that country. I am the only one who has ever gone there.
– It has never been the same since.
– No, it has been better; the country has gone on improving. When things like this happen people ask. “ Are you genuine in what you say? “ This country has now appointed an ambassador to Australia where previously there was a Minister. Conditions have changed so much. Members of the Opposition may laugh if they will. I am reminded of an old proverb which says that small frogs make a great noise after very little rain. That reminds me of some members of the Labour Party. But when any thoughtful person considers what happened on the border of Tibet or the incident in the Formosan Straits last year and the changes that have taken place, even in the attitude of people within this Parliament, together with the strong statement of Government policy so excellently presented by the Minister for External Affairs they will never agree with those who accuse us of sitting on the fence.
The CHAIRMAN (Mr. Bowden).Order! The honorable member’s time has expired.
.- Before I speak on the subject of External Affairs I wish to make a few comments on the remarks of the honorable member for Chisholm (Sir Wilfrid Kent Hughes). When he began his speech I thought he had caught the vision of the new line but as he proceeded and warmed up, the old blood began to flow in his veins and he reverted to his form of only a few night ago when he spoke about respectable gentlemen who sell wool and steel to China whose money is blood stained.
– So itis.
– Did you really say that?
– It seemed odd that the honorable member for Hume (Mr. Anderson), who is very interested in wool should be advocating trade with red China. I rose to congratulate the Minister for External Affairs (Mr. Casey) and the Prime Minister (Mr. Menzies) on their new line in foreign policy. I know that it is a complete about-face from their disastrous policies on Suez, Lebanon, Jordan, Cyprus and IndoChina and their opposition in the past to summit talks. Personally, I want to let bygones be bygones and I am prepared to accept their new line which coincides with the Hobart line and the Labour line. We must play this line of peace. I know that’ there is a division in the Liberal Party because the honorable members for Lilley (Mr. Wight), Moreton (Mr. Killen), Phillip (Mr. Aston). Chisholm (Sir Wilfrid Kent Hughes) and
Mackellar (Mr. Wentworth) are not happy about this new line. They are still belting the war drum. But this is the line of peace and, personally, I am grateful and humble that the Prime Minister has taken it up. 1 hope and pray that he is sincere about it, because we must draw our forces together. We must be in on the summit talks and do all we can so that we may have peace in our time. We do not want to see any more wars. Wars have solved nothing; they have only caused humanity to suffer.
Although the honorable member for New England (Mr. Drummond) criticized the honorable member for Grayndler (Mr. Daly) I wish to support the latter honorable member in his statement that there should noi bc Australian troops in Malaya. The only people who can solve the problems of Asia are the Asians themselves. The honorable member for Yarra (Mr. Cairns) spoke about economic aid for South-East Asia, and I remind honorable members of wise words which were spoken by Mr. Justice Douglas of the American Supreme Court when he was in this country. He said that if America spent 1 per cent, of its military budget in Asia, the problems of that area would be solved. We know that America has not given the aid that it should to South-East Asia, and whatever aid has been given has had strings attached to it.
I hope that the Prime Minister and the Minister for External Affairs are sincere in taking up the new line of peace and I hope that they can convince their back bench supporters that it is the right and only line to follow. It “was pleasing to know that when the Prime Minister was returning from overseas he visited Singapore and when, subsequently, he made a statement in this chamber he said some pleasant words about the new Prime Minister of Singapore. He pointed out that he had been democratically elected. That is so. His party won 43 seats out of 51. On what policy did it win them? It was on a policy of anti-colonialism and antiexploitation. The honorable member for Dalley (Mr. O’Connor) in a very reasoned, cool speech pointed out the great exploitation that had been going on the past in Asia. I agree with him that this must cease and that we must do our utmost to help develop these Asian countries.
The honorable member for Yarra emphasised this also but the honorable members for Lilley and Corangamite (Mr. Mackinnon) replied to him with sneers. The honorable member for Yarra said that a greater amount of money should be made available to the Department ot External Affairs in order to provide economic aid to these countries and also to expand the Colombo Plan. It is true that we must try to uplift these people with technical aid and bring their scholars to our schools. I wholly support the honorable member. I wish that certain back benchers in the Liberal Party would try to look at the wise words in speeches from this side rather than for points of criticism, or phrases on which they can place a wrong interpretation.
Members on this side fully support a policy of economic aid for the countries in the near north, but with no strings attached to it. The Labour Government assisted the establishment of the International Bank for the purpose of helping backward nations. Until recently Australia was its greatest borrower. When Mr. Chifley represented Australia as one of the parties to the. International Bank agreement he expressed the opinion that Australia should not borrow from it because its funds should be used to help backward countries. Ever since the Labo.-r Government went out of office Australia has been a borrower from the International Bank. I conclude by congratulating once more the Prime Minister and the Minister for External Affairs for adopting a new line on foreign policy. It coincides with the Hobart line and the Labour line - the only line.
Bill returned from the Senate without amendment.
Sitting suspended from 5.55 to 8 p.m.
Bill presented by Mr. Roberton, and read a first time.
– by leave - I move -
That the bill be now read a second time.
The purpose of the bill is to give effect to the Government’s decision, announced by the Treasurer (Mr. Harold Holt) in his Budget Speech, to increase maximum rates of age, invalid and widows’ pensions by 7s. 6d. a week, and to provide, in general, that the aboriginal natives of Australia, other than those who are nomadic or primitive, shall be eligible for pensions and maternity allowances on the same basis as other members of the community. Further amendments provide that a clothing allowance, payable by the Repatriation Commission, shall be excluded as income for the purpose of the means test on pensions and unemployment and sickness benefits.
The increase in pension rates will be the seventh since this Government first assumed office in December, 1949, but no one year in the last decade has .ever passed without substantia] extensions and additions to the social service programme. It will bring the maximum general rate of age and invalid pensions from £4 7s. 6d. to £4 15s. a week. The maximum general rate of widow’s pension payable to a class A widow - that is, a widow with one or more children under sixteen years - will be raised from £4 12s. 6d. to £5 a week, and the maximum rate payable to widows in other classes will be raised from £3 15s. to £4 2s. 6d. a week.
Last year the Government introduced a special payment, which came to be known as supplementary assistance, for certain classes of pensioners. This was granted in the form of an additional 10s. a week, over and above the general rate pension, to single age and invalid pensioners, to widows and to married age and invalid pensioners where one only is in receipt of a pension or allowance, who pay rent for their accommodation, and who are deemed to be entirely dependent on their pensions.
Those eligible for supplementary assistance will continue to receive that payment and, in addition, will receive the general increase of 7s. 6d. a week for which this bill provides. The pension they may be paid, together with supplementary assistance, will thus .be increased from the present £4 17s. 6d. to £5 5s. a week in the case of age and invalid pensioners; from £5 2s. 6d. to £5 10s. a week in the case of class A widow pensioners with one child under 16 years; and from £4 5s. to £4 12s. 6d. a week in the case of widow pensioners in other categories. Nor do these figures alone give a complete picture.
In 1956 the Government also introduced another additional payment for class A widows, invalid pensioners and permanently incapacitated age pensioners with two or more children under 16 years of age. Such pensioners now receive an additional 10s. a week for each child after the first. They, too, will continue to receive this additional amount for their children as well as the general increase of 7s. 6d. a week which it is proposed to make available under this bill. Thus, Sir, a class A widow with three children under 16 years of age will have her pension increased from £5 12s. 6d. to £6 a week, and an. invalid pensioner with the same number of children will have his pension increased from £5 7s. 6d. to £5 15s. a week. In addition an invalid pensioner may receive Ils. 6d. a week, by way of child’s allowance, bringing his weekly pension payment to £6 6s. 6d. a week. Child endowment is, of course, additional to the weekly payments I have quoted. Where such pensioners are qualified to receive supplementary assistance they will receive 10s. a week in addition to the amounts I have mentioned.
A general increase in pensions will, of course, benefit not only those who are now qualified for a pension or who would have qualified under existing conditions. It will also have the effect of widening the field of those who may in the future qualify for pensions. This will occur because the bill will automatically raise the total amount that a pensioner may receive by way of income plus pension. Thus, in the case of a single age or invalid pensioner, the general increase in pensions for which this bill provides will automatically raise the limit of income plus pension from £7 17s. 6d. to £8 5s. a week; and in the case of a married couple, one or both pensioners, it will be raised from £15 15s. to £16 10s. a week. Persons within these income ranges who are now ineligible for any pension may be able to qualify, for the first time, for a reduced pension. In the case of pensioners with dependent children the limit of income plus pension is, due to liberalizations of the means test and to increased rates granted by this Government, even more substantial. The effect of the general pension increase will be to make this limit still higher for such pensioners.
I would like to explain a few points in this connexion. In the first place, payments received by a pensioner from most outside sources in respect of a child - for example, war pension, superannuation payments, State assistance and payments of that kind - Arp excluded from “ income “ for the purposes of the means test. In the second place, where no such outside payments are received the permissible income of £3 10s. a week is increased by 10s. a week for each dependent child. Where a payment is received for a child from outside sources the amount of increase in permissible income is reduced by the amount of the outside payments. Child endowment and children’s allowances paid under the Social Services Act are not treated, for this purpose, as outside payments and do not affect the position in any way.
Thus, Sir, when the proposed general increase of 7s. 6d. a week has been made available, a class A widow with one child will receive a pension of £5 a week and will be able to receive other income from outside sources of £4 a week and child endowment of 5s. a week, making her total receipts £9 5s. a week. A class A widow with three children will receive a pension of £6 a week, and will be able to have other income of £5 a week and child endowment of £1 5s. a week, making her total receipts £12 5s. a week.
In the ;case of an invalid pensioner with a .non-pensioner wife and .three children, the pensioner will receive a pension of £5 15s. ;a week, .and his wife will receive a wife’s allowance of £1 -15s. a week and a child’s allowance of lis. 6d. a week. The pensioner and his wife will also be able to receive other .income between them amounting to £8 10s. a week and child endowment of £1 5s. a week, making their total receipts £17 16s. 6d. a week.
The proposed general increase of 7s. 6d. a week is more than sufficient to cover changes in the cost of living since the last general pension increase was granted in 1’957, and will, in fact, raise the real value of the pension to a record level. The point will fee contested by those who use arithmetic > to achieve their own political ends, but 1 confine myself to a simple statement of .the facts of the case.
Based on the C series retail price index the proposed new basic rate of pension, £4 15s., has in fact a purchasing value of 15s. 4d. in excess of the purchasing value of the pension which was being paid by the socialist government immediately prior to the eclipse of socialism in 1949.
It should be borne in mind, moreover, that the full value of the pension does not rest, for most pensioners, in the cash payment alone. Thanks to this Government, the majority receive free medical treatment and free pharmaceutical benefits, and an increasing number are now being provided with accommodation in homes for aged persons which have been constructed largely by virtue of the Government’s grants towards such homes. To this subject I shall revert later.
I would like to mention briefly two other provisions in this bill associated with the proposed general increase in pensions.
The .first of these provisions relates to pensioners who are inmates of benevolent homes. -Under the existing legislation a pensioner who is an .inmate ot a benevolent home ‘cannot .receive more ‘than 30s. 6d. a week of his pension if an age or invalid pensioner, or more than 27s. a week if a class B widow .pensioner. Where qualified, a pensioner .inmate of a benevolent home may, of course, also receive an additional 10s. .a week by way of supplementary assistance. The balance of the pension is payable in each case to the authorities of the home for the pensioner’s maintenance. In applying the general increase of 7s. 6d. a week to these cases, the rates of pension payable to the pensioner inmates will be increased by 2s. 6d. to ’33s. and 29s. 6d. a week respectively, exclusive of supplementary assistance, and the remaining 5s. a week will be added to the amount payable to the authorities of the home. This allocation has been followed on each of the three previous occasions when pensions were increased by 7s. 6d. a week, that is, in 1950, 1952 and 1’957.
The other provision in this connexion relates to blind war pensioners. A limit is placed on the amount that may be paid to such pensioners by way of war pension plus the age or invalid pension which :is paid free of means test to blind persons. This limit is equal to the limit of maximum age or invalid pension plus permissible income, and its object is to ensure that blind war pensioners, who receive the special rate war pension, are not placed in a more favorable position than totally and permanently incapacitated war pensioners who are not blind. The bill increases the limit for a married blind war pensioner from £31 10s. to £33 per fortnight, thus enabling such a pensioner and his wife to receive an increase in the total of their war and civil pensions equal to the general increase in civil pensions.
As announced by my colleague the Minister for Repatriation (Sir Walter Cooper), a new repatriation benefit will be introduced this year. This will be payable by way of a clothing allowance to persons whose clothing is subject to exceptional wear and tear or damage as the result of a war-caused disability. This clothing allowance will be disregarded in applying the means test both for pensions and for unemployment and sickness benefits.
I come now to the provisions relating to the aboriginal natives of Australia, and no provisions in this bill could give me greater personal satisfaction.
This is an occasion of great historic importance both nationally and internationally. For more than 50 years successive Commonwealth governments have been called upon to defend - or to remove - the traditional discrimination levelled against the aboriginal natives of our country who, for a variety of reasons associated with the native welfare laws of the States, were unable to qualify for social service benefits in the normal way. It was generally interpreted that, since the Australian Constitution gives to the Commonwealth Parliament no power to make laws with respect to the aboriginal native race of our country, natives with a preponderance of aboriginal blood were not eligible to qualify for social service benefits until they were exempted by the States from the State laws governing native welfare or, where there was no provision for exemption, were deemed to be exempt. It remained for this Government to clarify the position, and the effect of the legislation I now bring down to the House is to sweep away the provisions that place restrictions on aboriginal natives in qualifying for social service benefits, except where they are nomadic or primitive. I do not think I need develop to honorable members the impracticability, if not the undesirability, of attempting to pay social service benefits to natives who cannot be identified and who have no fixed location.
There have been considerable difficulties to overcome and a great amount of preliminary investigation and exploratory negotiations with the State authorities and other interested persons was necessary before we were in any position to formulate a new policy which would adequately meet the various problems involved. I would like to say at the outset that we have had the full co-operation of the State governments and their appropriate departments concerned with aboriginal welfare. The House will be interested to know that it was necessary for me to seek the co-operation of the State Premiers, and I am happy to say that it has been gladly given with both understanding and enthusiasm. We are now holding discussions with the missions, pastoralists and other persons who also share this responsibility, and I take this opportunity of expressing the Government’s thanks to all those people for the willing assistance which they have already given to officers of my department and for the offers of assistance that we have received.
The Government has not been unaware that present rates of benefit, in many cases, may be more than adequate - if not excessive - for the present needs of the natives concerned. We are aware that in some quarters there have been apprehensions lest benefit payments may not only be misused but may, in addition, be used in a way that would in fact deteriorate the conditions of some natives. We have had regard to these apprehensions. Where the Department of Social Services is satisfied that a native’s social development is such that he can with advantage handle the pension himself then the payment will be made to him direct. In other cases some or all of the pension payable in respect of the native will be paid to the mission, to a State or other authority, or to some other person for the welfare of the native. But no restrictions will be imposed that are not common, under similar circumstances, to all sections of the Australian community.
We are making a bold step - but not a rash step. We see dangers and we see problems, but we do not believe that the way to overcome dangers and problems is to refuse to face them. Some aboriginal natives are already in receipt of pensions and other benefits. Exemption from the provisions of the law of the State or Territory in which he resides, relating to the control of aboriginal natives, will no longer be a factor as far as eligibility for social services is concerned. We will replace legislative restrictions with co-operation with the appropriate authority. Our one object will be the welfare of our aboriginal people. On them we shall, because of the provisions of the amending bill, spend an additional £1,000,000. For this I trust and believe we shall receive a reward in the happiness and well-being of those who receive these benefits or on whom they are spent.
So much for the details of the bill. Let us now look at the overall picture and, as we must of course in this place, look at the total cost. The cost for a full year of the increase of 7s. 6d. a week in pension rates alone is an additional £12,700,000. The additional cost of extending the eligibility of aboriginal natives is, as I have said, a further £1,000,000. This is a total of £13,700,000 additional expenditure a year, without taking into account additional expenditure due to population growth and to other factors. For the year 1959-60 it is estimated that the increase in expenditure on age and invalid and widows’ pensions will be £21,300,000. Apart from the additional cost of the general increase, this sum includes £6,100,000 to meet the cost of the increased numbers of pensioners and £5,300,000 to meet the cost of an additional age and invalid pension pay-day in 1959-60.
Members of an inquiring turn of mind who have studied the Budget, but who are not given to reading footnotes, may be intrigued by the fact that the expenditure on child endowment for 1959-60 is estimated at some £5.000,000 less than the expenditure in 1958-59. This is accounted for by the fact that there will be only four twelve-weekly bank payments of en dowment in 1959-60, whereas there were five such payments in 1958-59. The actual additional cost during the current year because of the increased number of children eligible will be £2,300,000. Expenditure on items under the Social Services Act will increase by £15,500,000, rising from over £221,000,000 in 1958-59 to more than £236,600,000 in 1959-60. Total expenditure from the National Welfare Fund will increase by more than £22,500,000 and for 1959-60 will be more than £300,000,000.
Where do these huge sums go? The answer is that there is hardly an Australian home that does not receive some form of Commonwealth health or social service. My own department alone makes payments that contribute each year to the maintenance of 4,000,000 men, women and children. These payments go not only to those whose working days are over, those whose earnings are interrupted; they also go towards building a strong and resilient nation of the future.
The mention of homes brings me to my final point. I shall not dwell upon the various health benefits to which so many social service beneficiaries are entitled. These have not merely a cash value over and above the pension or other benefit rates paid. They are a material factor in bringing about the well-being of our people. Not only are they a material factor, but they relieve pensioners and beneficiaries of the worries, anxieties and fears of the costss of ill health, which can in themselves retard recovery.
My reference to an Australian home will remind all honorable members of the magnificent results of the Aged Persons Homes Act - a piece of legislation that is both essentially imaginative and eminently practical. By this act the Commonwealth makes grants of £2 for £1 to churches, charitable, returned servicemen’s and other organizations towards the provision of homes for our aged people. I am happy to tell the House that during 1958-59, 113 additional grants, involving nearly £2,240,000 of new Commonwealth money, were approved. This expenditure will mean the provision of an additional 2,162 beds when the building programmes are completed. The total accommodation provided with the assistance of the act will be for more than 7,000 of our older citizens. I pay tribute to those organizations and to their members for their selfless effort and enthusiasm in carrying out this great work of providing homes for our aged. In 1958-59 this Parliament appropriated £1,300,000 towards grants for this fine purpose. Expenditure was, in fact, little short of £1,800,000. The Government’s belief that every assistance should be given to this outstanding community effort is demonstrated by the fact that this year the appropriation will be £2,000,000.
Mr. Deputy Speaker, it might be of some interest - favorable or unfavorable - to honorable members to know that I have now held the portfolio of Social Services for a longer period than any other Minister since the department was divorced from the Treasury and set up its own establishment in 1941. Admittedly, there is no special merit in that, except that it permits me to speak with a degree of intimacy that is denied to those who only know the department as a part of the intricate machinery of modem government.
During the last four years I have had occasion to say publicly that it does not matter very much who the Minister for Social Services is from time to time - since Ministers come and Ministers go - but it is of the very greatest importance that the department should attract to it people, men and women alike, who are prepared to dedicate themselves to the humane tasks which are inseparable from the administration of legislation that is designed to relieve hardship and improve the circumstances of those who, for any reason, have not been able to make adequate provision to meet the normal hazards of life and living. That, I am happy to say, is the proud position of the department, and these tasks are being faithfully performed by the 2,600 people who are currently engaged in providing Commonwealth social services to the community on an expanding scale.
Fifty years have elapsed since the first social service payments were made in 1909 following legislation passed by the Parliament in 1908. That legislation made provision for the payment of Commonwealth age pensions at the rate of 10s. per week to men and women of 65 years of age who had an income up to a permissible limit of 10s. per week. It was not until 1910, a year later, that the qualifying age for women was reduced to 60 years.
The records show that the question of the rate was bitterly contested both by those who argued that it was too low to meet the needs of the indigent, and by those who believed that a higher rate would impose an intolerable burden on the economy of our country. Similarly, the imposition and application of the means test was the cause of great resentment, lt was variously interpreted as a penalty on thrift or as a premium on improvidence.
That original scheme set the pattern for all our pension payments and, but for progressive increases in the rate - although there was one downward variation - together with progressive liberalizations of the means test, both with respect to income and property, it has been followed ever since by successive governments without exception.
There is, I regret to say, no known way to avoid the disputation that arises when the rate is under discussion. The increases provided for in this bill will be contested in the traditional way by those who have no administrative responsibility in the matter and by those who believe that responsibilities of the kind can be ignored with impunity.
The simple facts are that no government, with a full sense of responsibility and after a careful review of the general economic position, would suggest a rate lower than the taxpayers of our country might reasonably be expected to provide, or a rate higher than that which could be provided, in terms of the total sum involved, £300,000,000 this year, without prejudice to the general community.
Nor is there any known way for any government to reconcile the conflict that exists between those who believe that all the resources available for social service purposes should be concentrated on the payment of pensions to those who are entirely without other means and, on the other hand, those who believe that the means test should be completely abolished.
The Government has tried to meet that situation by easements of the means test from time to. time, with regard to both income and property, to include increasing numbers of people, but these most liberal changes have brought little comfort to the people who are still excluded from social service benefits of any kind, and no comfort to hundreds of thousands of pensioners who are without other means. That is it. Conflict.
It is in this atmosphere of conflict that I am required to live from day to day and it is in this atmosphere of conflict that the officers of the department are called upon to discharge their humane duties. We see the problem as it affects the lives of more than four million people, or more than 40 per cent of the total population. We see the problem as it involves the community in increasing expenditures; rising from £1,500,000in 1910 to more than £300,000,000 today, and we recognize it as one that can be solved only when the economic resources of the community can measure up to all the social needs of modern society.
Mr. Deputy Speaker; I am asking the House to approve of a bill” which will add substantially to the cost of our social services; a bill which will not only benefit existing pensioners but which will give to people previously excluded an entitlement to some pension; a bill which recognizes the rights- of our aboriginal natives to qualify for benefits on the same basis as other people of the Commonwealth. I do it with confidence that the people of Australia are now, and will be in the future, willing and able to bear the costs involved. I do it in the confidence that it will bring about the greatest amount of human happiness and wellbeing that such expenditure could encompass. I commend the bill to the House.
Debate (on motion by Mr. Allan Fraser) adjourned.
– I claim that I have been misrepresented and I wish to make a personal explanation. I refer to a speech which was made in this House by the honorable member for Grayndler, (Mr. Daly) on Tuesday last.
– A very good speech!
– It had a lot to recommend it. Normally, I would not mention the matter in the House because although the honorable member for Grayndler has grossly misrepresented me, that is something which one normally takes from him as a characteristic departure from the truth. In that speech the honorable member for Grayndler said -
The honorable member for Bruce . . . reads his- speeches from time to time.
That is not true. He went on to say: -
He represents the oil cartels and monopolies in this place.
That, of course, is typical’ of the untruths that are dragged out of the air by honorable members opposite because they have no: basis for real criticism.
The way in which thismatter has been reported in the press has been unfortunate. The. Melbourne “ Herald “ departed from the text used by the honorable member for Grayndler. The report in that newspaper stated -
Then again there’s Mr. Snedden (Liberal, Vic). His, speeches are prepared by the oil cartels.
There is a great distinction between what Dilly-Dally said and what was written in the “ Herald “. The story appeared under the heading of “ Overnight in Parliament “.
– Who is this fellow Dilly Dally?
– Order:? The honorable member for East Sydney will remain silent.
– I rise to order, Mr. Deputy Speaker. I’ ask you whether the honorable member for Bruce is in order in referring to some other honorable member in this chamber as “ DillyDally “.
– Order! Does any honorable member acknowledge that the reference was made to him?
– I recognize how very easy it is when reporting in columns such as this to make an error because it purports to be a contraction of what is said. It is very understandable how the writer of this column wrote what he believed to be an accurate report, but, on close examination his report emerges as a departure from what was, in. fact; said. I claim that I have been misrepresented in what has been said by the honorable member for Grayndler and in the story as it appears in the newspaper, but more particularly as it appears in the newspaper because it is completely without any substance at all. I have never had any speech prepared for me by anybody and particularly not by the oil cartels as is alleged. First, I did not know that there is any such thing as an oil cartel. Secondly, I have never had any association with such a cartel or been approached by a representative claiming to represent such a cartel at any time.
In Committee of Supply: Consideration resumed (vide page 927).
.- During the past few days we have been discussing the estimates for the Department of External Affairs. We have heard a lot of talk about foreign aid for underdeveloped countries and about the Colombo Plan. I think it was my colleague the honorable member for Ballaarat (Mr. Erwin), who has been in that area and seen a lot of the work done under the Colombo Plan, who first mentioned this matter. Following him honorable members on both sides of the chamber have discussed freely and at length the work that is being done under the Colombo Plan. I think I can say in truth that all of them would like to see aid under the Colombo Plan extended, but all realize that Australia has done a reasonably good job in the administration of the Colombo Plan in the areas just north of Australia in Asia. It has been a reasonable success. I think probably the best side of it is that we have some 6,000 students from Asia now in Australia in either schools or universities who will return to their countries and help in their development. Australia can be proud of the part we have played in the encouragement of the Colombo Plan, but there are other forms of aid which we should not overlook.
We could contribute in other ways to the development of under-developed countries. Perhaps 1 shall throw a spanner in the works by referring to other forms of foreign aid in which Australia has not played a great part. I refer particularly to the United Nations Special Fund which was set up last year to assist the economic development of these under-developed countries throughout the world. Honorable members may recall that about a fortnight ago I asked the Minister for External Affairs (Mr. Casey) whether it was a fact that Australia was one of the few countries in the world which had made no contribution to the United Nations Special Fund. I went on to ask, in view of the fact that Australia’s economic position appeared to be much stronger, whether we would be able to make some contribution this year. Honorable members will recall that the Minister for External Affairs said in reply that it was not true that Australia was one of the few countries which had failed to make a contribution. He said it was one of a considerable number of countries which had not contributed. I leave honorable members to judge which was the correct adjective to use in this case.
On looking through the records, we discover that 61 countries have contributed to the United Nations Special Fund which was set up in October last year, and only 27 nations have not made a contribution or have not yet announced what their contribution will be. Australia is one of the countries which has announced that it will not make a contribution, so certainly it is one of the few nations which is not contributing. I think the adjective I used in this case was correct. Let me tell the committee briefly of some of the small and economically unsound countries with which Australia finds itself grouped. As honorable members know, Australia is the eighth largest trading nation in the world. I suppose we have one of the highest standards of living in the world. Surely from that high standard of living we could make some small contribution towards the United Nations Special Fund, but I find on looking through the records that Australia is placed alongside such small countries as I shall mention. I will not read the complete list of these countries with which Australia is grouped but some of them are Albania, Cambodia, Burma, Costa Rica, Cuba, the Dominican Republic, El Salvador, Finland, Guinea, Honduras and Iceland. These are among the many small countries which are economically very under-developed and with which Australia, one of the great developed and progressive countries, is grouped.
There are other countries which are small and, in many ways, under-developed, but which have contributed to this fund. Some of the countries which have contributed are Afghanistan, Bulgaria, Ceylon, which we are assisting through the Colombo Plan, Chile, Nationalist China, Colombia, Ecuador, Ethiopia and Ghana. Many of these under-developed countries are crying out for capital, but they are prepared to contribute to the fund. Australia is not prepared to do so. Let me inform the committee about the contributions that some other countries have made. I suppose we could take our sister Dominion of Canada as very similar in many ways to Australia. It has a larger population and it is more developed industrially, but it probably has a larger unemployment rate than we have. Yet Canada made a donation of 2,000,000 dollars to the United Nations Special Fund. The Scandinavian countries are very similar to Australia. Denmark contributed 330,000 dollars, and Norway 377,000 dollars. Sweden, a country with a smaller population than Australia’s, gave 2,100,000 dollars. The Netherlands, a relatively small country with a large population, contributed almost 2,500,000 dollars.
One does not need to stress the enormous contribution that has been made to the fund by the United States of America. Just before the suspension of the sitting for dinner, the honorable member for Reid (Mr. Uren) quoted a saying of Mr. Justice Douglas, who said that if America spent 1 per cent, of its military budget in Asia, it would settle the problems of Asia. When it comes to the funds of the United Nations, the United States of America has been particularly generous and, in fact, has donated towards the two funds for the development of under-developed countries a total of 38,000,000 dollars. That is probably as large a vote as the contributions of the rest of the world put together. Perhaps there was some reason why the Commonwealth Government failed to make a contribution towards this fund last year. We did budget for a deficit of £110,000,000. In actual fact, terms of trade turned out to be very much better than was expected at the time, and when one reads the Auditor-General’s report, one sees that Australia is £70,000,000 better off to-day than it was a year ago. Terms of trade have certainly turned our way. We know that the wool market has opened on a buoyant note. It is between 20 per cent, and 25 per cent, higher to-day than it was twelve months ago. We expect to have an all-time record clip which will probably mean that we shall get something like £80,000,000 more this year from our wool clip alone. Our meat is selling well. Our wheat return again looks like being a record. It appears to me that there is no reason whatsoever this year why at least some small contribution could not be made towards this United Nations special fund.
I might say that, as one of the Australian representatives at the United Nations last year, I sat on the second committee and found myself in the humiliating position of being told by a Minister that it was best for Australia if we did not say anything, because, if we did, we would be asked what contribution we were making. So, I sat on the second committee for a month and said “Yes” twice and “No” twice. In fact, I felt so embarrassed at the time that I went to the Minister for External Affairs and asked, “ Is it not possible to open a public fund in Australia and call for donations from the people? “ The Minister for External Affairs said he would consider the question, but he came back later and said that he thought it would be better not to do anything of that sort this year. No doubt, he felt that if a public fund were opened it would be a reflection on the Government’s refusal to contribute.
I think the reasons for the Government taking this attitude are probably three. The first one is that we do make a very considerable contribution to the Colombo Plan. I have discussed this with the Secretary to the Treasury, and various other people, and they say: “ Australia has a certain amount of money for use abroad in the undeveloped countries, and we feel that if it goes into the Colombo Plan it is marked as coming from Australia. It goes to our neighbours in the near north and we get the greatest kudos from it in that way.” In other words, it is ear-marked as a gift direct from Australia. Their attitude is that if we make ;a donation to a United Nations fund, the money is .used :by the Secretariat of .the United Nations, and when it is spent in ‘some .of these under-developed countries the people say, “This is very nice; the United Nations gave us this “. They do not say that Australia gave it to them. To a certain extent, one cannot help agreeing with that view. Undoubtedly, the major contribution that Australia will be making in the foreseeable future will be to Colombo Plan aid; but that does not prevent us from being able to take our rightful place as contributors to the special fund.
Secondly, I suspect that there has been some thinking in the Cabinet on this, because members have told me that most of the money that has been contributed to the special fund will be used in iron curtain countries. Either the people who told me this did not read the brief that was sent up to them, or that brief was completely incorrect, because, on going through the list of projects, one finds .that, out of the thirteen or fourteen projects which have already been put under way, only .two were in iron curtain countries. One was in Poland, and the other in “Yugoslavia. Of the total amount of money allocated, only 1,50Q,000 dollars went to those two projects,, compared with something like 6,000,00.0 dollars to countries outside the iron curtain.
Perhaps the .third reason is the one touched upon .by the honorable member for Wentworth (Mr. Bury). It is that Australia, as well as having commitments at home, has .commitments for the .development of .New Guinea. Undoubtedly, we do spend a large amount of money on developing New Guinea, which is administered by us under mandate, and a country which we all know eventually will be governed entirely by the natives themselves.
In conclusion, I make a plea once again to the Government to reconsider its attitude to this special fund. I feel that Australia .has been made -to look small in the eyes of .the world and has been humiliated. I hope it .will take its rightful place amongst the donors to this fund.
.- One :of the most significant revolutions in thinking since the war ,has ‘.undoubtedly been our change of attitude .towards Asia. This debate has emphasized that fact quite clearly. Although we -on this side criticize the Government for not having grasped all available opportunities to develop better relations between Australia and Asia, we cannot deny that there has been a tremendous movement in the right direction over the last ten years. That is all to the good.
For the last 200 years, we have been linked with .the United Kingdom culturally, spiritually, by hereditary ties and by religion. We have also been linked with the United Kingdom in colour. In other words, our thinking has been directed to the United ‘Kingdom. In later years, it has taken a swing one-quarter degree to the north of Australia and .we are coming to understand our neighbours to the ‘near north as .we (have : never understood them before in our history. In addition to welcoming them here as visitors, we have gone so far as 10 agree to ‘the naturalization of Japanese war ‘brides. Who would have thought of that a ‘few years ago? I know one Japanese war bride in my own home town in Tasmania. She is .a wonderful citizen, and !l am very proud to ‘be associated with her and her husband, ‘who is a member of our armed forces. I .am proud of the way this Japanese -war bride is coming to understand ‘this country and of the way she is settling down in Australia as an Australian. (Geographically, Australia :is really an Asian country. And :this is becoming more and more significant. ‘We are the only white nation in Asia. To -the north of us, there are 1,200,000,0.00 people and we are the only whites in the area. “There are only 32.000J000 nominal ‘Christians in the whole area. The Philippines and Australia are the only two nominally Christian countries. The other religions in Asia are Hinduism, Mohammedanism, ‘Confucianism and Buddhism. I believe that much of the backwardness of Asia is due to the religions of that continent, and ‘I -say that advisedly. ‘I have been there and studied their religions. I know that those religions have nothing whatever to do with life on this -earth. Their religion has practically nothing to say about such matters as sanitation, hospitalization, better security, employment and industrialization. For thousands of years, the religions of Asia have emphasized another world; they have, no reference to this world. They are all alike in that connexion. They are in fact other-worldly.. The backwardness and degradation of great, parts of Asia. are. due largely to a passive attitude to the various social evils in modern society.
The next great problem is the economy of Asia. That is in the position in which the economy of Europe was 100 years ago. At that time, Europe was going through an industrial revolution. In 1848, country after country overthrew its monarchy, and self-government became the order of the day. Asia is going through that phase now. In the last ten years, country after country has attained self-government. The last to achieve it was Singapore; but I should say it has attained only 90 per cent, selfgovernment. The economy of. Asia is largely agricultural, and its agricultural methods are very primitive- indeed. Tremendous strides have to be made in this field even adequately to feed the increased population of this vast area. Here we see the value of the Colombo Plan, which the honorable member for Farrer (Mr. Fairbairn) referred to so ably just a moment ago, and which has the complete approbation of the whole of this Parliament and everybody in Australia. To date, Australia has spent £30,000,000 in Asia through the Colombo Plan, whilst a total of £800,000,000 has been contributed by all the member nations of the Colombo Plan. I have heard from one of my colleagues from Victoria that many tractors that have been given under the Colombo Plan are lying rusting in India. I can understand that that kind of equipment might be unused, but I believe that the great bulk of the help that is given through the Colombo Plan is worthwhile. Think of the great hydro-electric schemes we are helping the people of Asia to build, and of the irrigation schemes whereby vast areas of parched, hitherto useless land are being turned into agricultural land on which rice and other crops will be grown. Those are mightly achievements and victories in the economic field for this agriculturally backward area.
I believe that the future of the world will be decided in Asia. In fact, the next fifty years will find the concentration of thought and energy in Asia rather than in
Europe. Perhaps the history of the next 50 years will be written in> Asia. Asia is a. great giant awakening. The direction that it will take no one knows at this moment. We do not know whether Asia is to be bloodied by revolution or is to enjoy a great advance by evolution. We in Australia cannot shut our eyes or our hearts to. the future of Asia. We have a job to do, irrespective of political parties and, of denominational links. We must help to guide Asia into the ways of true democracy in government and true security in economics. We must help it to achieve a true, ideology.
Perhaps the first problem of Asia, Sir, is poverty - abject poverty that is worse there than anywhere else in the world: If you visit India, you. see a vast number of people living in constant fear of cholera and tuberculosis which they are. liable to contract through malnutrition - lack of food. In India, the life span is 28 years.
– It is 31 years.
– Then it has advanced since I was there in 1952. When I was in India the life span of an Indian was 28 years. I am glad to know that it has risen to 31. That means that if an Indian lives to 31 years of age he is a lucky man, and he is also an old man. The child mortality rate is at a shockingly high level. When I was in- Bombay, a £300,000 hospital was going up, not for the Indians, but for the Europeans. Hospital treatment is practically unknown in Asia, and so is sanitation. The lack of those things is partly the reason for the shocking diseases and poverty of Asia.
Homelessness in Asia is a notable feature. In South-East Asia, there are 123,000,000 people without a home of any kind. That is a colossal social problem which we must help to solve.
– That is nonsense.
– It is, of course, nonsense that the honorable member for Hume is in this Parliament. For the last five years he has not agreed with anything that we on this side of the chamber have either said or done.
The third main problem of Asia is illiteracy. It is, of course, monumental. We must help, through the Colombo Plan, with educational aid to build up the educational standards of Asian people. Educated Asian people are, I believe, amongst the finest people in the world. We have seen some of them in this country. They show that if these folk can be given a chance to develop their minds, they can make a great contribution, not only to their own countries, but to the world. In leadership, Asia has a problem. How vital it is for Asia to have the right leaders at such a critical time as this! It is a wonderful thing for the future of Asia that in Singapore and Malaya there are two very able leaders. They differ in their political views, perhaps, but I should say that they are united in what they want for their countries.
The next problem of Asia that I want to mention is nationalism. Nationalism is a good thing if it is directed into the right channels. This is where communism comes in with its influence. The Communists misdirect nationalistic movements in many countries, particularly in Asia, for their own ends. The Communists are all the time wanting to take advantage of the national aspirations of newly developing countries. Here again, we can give guidance and help to Asia in determining the way that governments of that area are to go. Communism, of course, is one of the worst problems of Asia in that if it continues its southward march, and if the Communists take over more countries of this vast area, we may find a thousand million people under the yoke of communism. That would be a tragedy in any language. All that we in this country can do to short-circuit the effects of communism will be of tremendous future value to Asia.
Finally, we, as an Australian people, must give to Asia four main things. The first is friendship, genuine and real friendship, not the sort of friendship given by people who look down on the Asian people because they are illiterate or have not been to universities, or because of the colour of their skin. What a wonderful record Australia has in the eyes of the world in its dealings with coloured people. America, although more than 100 years have passed since the Civil War, still forces negroes to eat in different restaurants from those in which white people eat, and to travel on different trams, trains and aeroplanes. Negroes are separated, ostracized and condemned throughout that vast country that talks about democracy. I admit that we in Australia have made many mistakes in our treatment of the aborigines, but there is not one Asian person who would not be welcomed into an Australian home. Not once would you find an Australian saying to an Asian person, “ You cannot eat with us in this restaurant “ or “ You cannot ride in this tram or this bus or this plane “. Asians are welcomed in our homes as if they were Australians. That is to the everlasting credit of the Australian people, irrespective of their politics or status in life. Let us build on that a genuine friendship that the Asian people who come here may take back to their countries, something that will last for ever in their hearts and help to break down some of the other barriers that may divide us. Friendship is one of the things we must give to Asia - genuine, sacrificial, helpful friendship.
The second thing that we must give to Asia is food, and it is in this respect that the Colombo Plan is doing so much good by building up agricultural production. We are even teaching some of the Asian people to eat bread. That will be a help to our wheat farmers in later years. Japan at the moment is taking barley and wheat from us. The Japanese are prepared to have a go at anything, even at eating bread instead of rice.
The third thing we can give to Asia is freedom - the Four Freedoms - and this is where a democratic system of government is necessary. We do not want the Asian people, under their new governments, to have to suffer concentration camps. We do not want them to have to suffer slavery, as we know happened under nazism or fascism and still happens under communism.
– Or economic slavery.
– Or economic slavery. I mentioned that a while ago. Freedom, including freedom to vote at the ballot-box, is the greatest thing in the world. The freedom to elect a government and the freedom to put a government out of office are basic freedoms we can help to give Asian countries, and win them away from the slavery of communism or fascism. We must help to give them a faith, an ideology, a system of beliefs, a way of life superior to anything else that other systems can give them. We find that the Christian ideology works here, and we must show the Asian people that it can work in Asia too. After all, the ideology is not the possession of any one nation or the hallmark of any one nation. It is available to every person in the world irrespective of colour, class or creed.
– Order! The honorable gentleman’s time has expired.
Mr. WENTWORTH (Mackellar) [9.10J. - I think that all honorable members will appreciate the charitable sentiments just expressed by the honorable member for Wilmot (Mr. Duthie) - charity to all men except, perhaps, the honorable member for Hume (Mr. Anderson). And, Sir, I think we will all agree with the honorable member for Wilmot that Australia should do what it can to help and encourage Asia. In so doing, let us not be too patronizing. Let us not overestimate our aid or our numbers in comparison with the numbers in Asia. I venture the comment that perhaps some Tasmanians do not always know their own strength.
Now, Sir, at the outset may I just advert for a moment to a remark made earlier in this debate. [Quorum formed.] I am indeed appreciative of the action of my friend from Watson (Mr. Cope) in directing’ attention to the state of the committee. I was about to refer to a remark made earlier in this debate by the honorable member for Reid (Mr. Uren) who, mentioning me by name, suggested that I was out of touch with the sentiments expressed by the Prime Minister (Mr. Menzies) and the Minister for External Affairs (Mr. Casey) earlier in this debate in relation to summit conferences. Nothing, I think, could be further from the truth. Indeed, those were the sentiments which I myself expressed in this chamber over a year ago, and if honorable members will turn to page 1323 of the “Hansard” report of 30th April, 1958, they will find that I am not at all out of step with the Government in that regard.
I support the remarks made by the honorable members for Corangamite (Mr. Mackinnon) and Chisholm (Sir Wilfrid
Kent Hughes), and other honorable members in relation to the necessity to increase proficiency in languages among officers of the Department of External Affairs, particularly proficiency in those languages which are native to the countries which concern us most. I think that this is something that the department, whose estimates we are now reviewing, has rather tended to overlook. Sufficient encouragement has not been given to the officers of the department to learn languages. There has perhaps not always been sufficient attention given in the past to posting officers to countries where their language proficiency would be of the most use.
Now, I know that in Australia - and this has been expressed by other members in this chamber - it may be difficult to attain the necessary proficiency in certain of those languages, because of the lack of teachers. I am not certain that that is true here in Canberra itself, because in this city we have a number of people attached to the various diplomatic missions whose native languages are those of a large segment of the globe with which we have the closest possible connexion. It may be that by using as language teachers people from the legations with which we have the friendliest ties and, in respect of the iron curtain countries using expatriate nationals who are fleeing to Australian refuge from totalitarian tyranny, we can sensibly improve the proficiency in languages of officers of the Department of External Affairs. This has got to be looked at in a forward and constructive way. Facilities should be provided - they can be provided - and furthermore there should be adequate financial recompense for officers who successfully undertake the task of learning those languages, which in some cases are very difficult for a speaker of English to. learn.
Now, again, Sir, if I may traverse a point which has been raised by other speakers, I should like to say that on looking through the departmental estimates I am amazed at the continued failure on the part of Australia to establish an embassy in the Republic of China at Taipeh. Free China, which at present is located in Formosa, is one of the countries which should be ‘the first concern of Australia in the establishment of diplomatic relations. This is ‘a .country which is thoroughly on our side. This is a country which is making tremendous efforts to maintain a defence ‘force which is part of the shield keeping Australia safe, and no mean part of that shield. One would have thought that in view of the fact that Free China has not seen fit for a long time to be represented by an ambassador in Canberra “but has now appointed an ambassador to this country, Australia would have reciprocated by -establishing an embassy at Taipeh. The Chinese minister, who has served a long and honorable term here, is .now in the process of handing over to the new ambassador to whom we wish the same good fortune and whom we will greet with the same goodwill that we have given to his predecessor. I do not know why we have not established an embassy at Taipeh. I thing it is high time that the Government did so.
Furthermore, if .1 may advert to some remarks made by the honorable member for Farrer (Mr. Fairbairn) I ask: Why is not the benefit of the Colombo Plan extended to Free China, which needs it? If it be impossible to bring Free China, on Formosa, within the ambit of the existing Colombo Plan, why is it that in parallel, and of our own volition, we do not do something .along the same lines, diverting to Free China some small and fair fraction of the resources which we give to other Asian countries that are our friends? I do not know the answer to this question. This is something which we should do. Why have we not taken more steps to build up trade with Free ‘China?
I again acknowledge with some pleasure that in .the last few months the Government has been taking some steps along these lines. I am sorry that that action has been so long delayed. I hope that now the action has been commenced, it will be prosecuted with due vigour.
I should like to say something about the staffing of our embassy in Moscow. A perusal of the .estimates for the Department of External -Affairs will show that we are making .provision for some of the work an the Australian embassy in “Moscow -to be done by “Russians. ‘We know ‘from experience that it will therefore be done by Russians whose primary loyalty is not to us. Indeed, why should we expect it to be to us? But those people will not only owe a primary loyalty to the Soviet; they will be people Who have been selected by the Soviet as agents, or at least approved as agents, otherwise we would not be able to employ them. We know that from time to time concealed microphones were found in our embassy when we last had one in Russia. “We know, for example, that even recently -in other embassies in Moscow, and in relation to distinguished visitors, this practice of using concealed microphones still obtained. It does not seem reasonable that we should be giving the Russians extra facilities to carry on this practice.
I do not think -that this by itself is a very important matter, because I do not think that secrets of any great .moment to the Russians will be found in our embassy in Moscow. That is not “the point that I am trying to make. The point I am trying to make is rather more important and, I think, quite a little different. If we are to have contacts with Russia on any terms that give us some prospect of success, those contacts must be on terms of equality. The Russian embassy in Canberra will be a dosed fortress to which Australians will not be admitted. The Russians are perfectly entitled to do that if they wish. It is their diplomatic right and privilege. But if they do .that we should be doing the same thing in Moscow, not because the espionage to be practised on us in Moscow is important - that is a minor matter - but :to establish and maintain .the principle of equality of treatment, which is a necessary principle in our contacts with ‘the Communist world. That is not a trivial matter. The possible espionage is, I think, a trivial matter, but the principle of equality of treatment is not. For the Government to have forsaken the principle in the reestablishment .of our embassy in Moscow seems to .me .to be tragic. It indicates a lack of understanding on the part of the Government of the nature of this contest between the democratic and totalitarian worlds, and a lack of (understanding of the manner in which ,this contest -must be waged if indeed we ate -to have any prospect -of success.
This, of course, is only one consideration. Do not let me inflate it beyond its due proportion; but it is a very important point and an indication of something that we should do. This position that we are accepting should be rectified unless there is a change in the staffing of the Russian legation at Canberra. In that case, of course, let us accept equality at the other level, but do not let the thing be all onesided.
During the course of this debate three or four honorable members opposite have said that there is disunity in the Government ranks on the subject of communism. In a sense that is true and in another sense it is untrue. It is true in the sense that the Government ranks differences of opinion exist as to how best to combat communism. That is quite different from the differences in the ranks of honorable members opposite, which are differences as to whether they will support communism.
The TEMPORARY CHAIRMAN.Order! The honorable member’s time has expired.
.- I think that the debate on the estimates for the Department of External Affairs has been important because of what has been revealed about the thinking of honorable members with respect to Asia, and I want to refer to that matter briefly. But first I want to discuss these estimates in their narrowest sense as they affect the Department of External Affairs. Abroad it is noticeable that the status of Australian diplomats is not adequate. New Zealand diplomats, as far as I can see, are the only ones who are paid on a scale worse than Australians. I frankly think that it is fantastic that a man occupying the key position of Australian Ambassador to Washington is paid £3,750. Australian diplomats abroad are in a very difficult situation with regard to the education of their children. The Government’s allowance to diplomats for themaintenance of children whom they may be forced to leave behind in Australia is insufficient. If they take their children to a foreign language country it is very difficult to arrange for private tuition. Their salaries would not allow them to pay for private tutors. That difficulty is one factor that prevents us from attracting the best type of officer to the Department of External Affairs.
I feel that the whole policy of recruiting diplomatic cadets is wrong. People at 21 years of age are far too young to begin a diplomatic career. I think that people of 30 years and older, who have had experience in other occupations, are much more likely to be able to assess social trends in countries to which they may be accredited.
I wish to protest against the references that have been made in this chamber to Asia that Asia does this and Asia does that. Asia is not a bloc, any more than Europe is a bloc. There are marked differences of opinion on world affairs between, shall we say, India and Pakistan. References have been made this afternoon to Singapore. The one area that Malaya does not wish to have incorporated in the federation is Singapore. There are differences of opinion between India and China over Tibet, and I will make some further reference to that later.
Asia is not a bloc. Asia is not obsessed with Australia. People consistently refer to Asians as desiring to migrate to Australia. Perhaps the most notable feature of Asians is their extreme conservatism with regard to migration. There are 70,000,000 or 80,000,000 people in Java, which is an island not as large as Sumatra. Sumatra has only onetenth the population of Java, but the Javanese have no desire to migrate to Sumatra although it is another part of Indonesia. When the Dutch ruled Indonesia they could not induce the Javanese to migrate to Sumatra, and Soekarno has been unable to do any better. In Indo China in the Mekong Delta the population is more dense than anywhere else in the world 2,000 people to the square mile. But they will not migrate to the more fertile highlands not far away, where the population is only ten persons to the square mile. I do not wish to deride those people, nor to condemn them. I make no observation other than to state the simple fact that there is no substance in this passionate belief held by some people that everybody in Asia wants to migrate to Australia or to attack us. If you look at a globe of the world you would not assume, from the point of view of proximity, that the people who were going to inhabit this country were the English, who were just about as remote as they could be from Australia. It was the extreme conservatism of Asia with respect to migration which determined that this country should be populated by Europeans.
Another point - and I want to say this very definitely to the Australian trade union movement - is that Asia cannot attain Australia’s wage structure in the immediate future. If we send capital equipment under the Colombo Plan or in any other way to develop secondary industries in Asian countries and then refuse to accept goods from them on the ground that Asia is a cheap labour area, we destroy their capacity to reconstruct themselves. The standard of the basic wage worker in Australia to-day is 70 times as high as that of an Indian. It does not matter how efficient Mr. Nehru’s government is, or how much goodwill there is in preventing what we call exploitation. Low wages in the world are not all the product of exploitation. There are some areas that simply have not resources, and that is all there is to be said about it. But no matter how efficient people are, they cannot in the immediate future attain a standard of living equal to that in this country. If we then wage economic war on them by shutting out their goods on the ground of the low wage structure in their country and say “ You should not be allowed to compete with us “, we are wasting time in giving them capital equipment under the Colombo Plan. We are also destroying their capacity to earn their own living which, I submit, is much more important than being given, food gifts by us. It is much better that they should be in a position to earn their living. This is not an argument against immediate gifts of food for distressed and famine areas but it has to be logical that if we on this side of the chamber endorse the Colombo Plan, we have to adopt some kind of a systematic approach about what we are going to do about the goods that are produced by the Colombo Plan industries that will be set up.
– They consume a lot of our goods.
– That is true. A 5 per cent, rise in the standard of living would transform the whole of Australian agriculture. We must be realistic about it. We can win elections on tariffs and kill our children in 15 years through having done so. It is an important consideration as well as winning elections.
We also need an attack of modesty on this subject of religion. I think people will be quite prepared to accept a Christian who is a Christian. Ibn Saud, of Saudi Arabia, expressed the disappointment of a Moslem country that after entering into all the treaties about oil none of the socalled Christians had ever asked him for the right to put up churches in his country. The way those Moslems looked at it was that we regarded getting their oil as vitally important, but did not regard their making any concessions to our faith as important, and, therefore, we had no real belief in God, and consequently, we were not trustworthy persons.
I think that the Asians and others are prepared to accept Christians who are Christians, but basically the Buddhist and the Moslem world regard the West as the source of drink, drugs, immoral books and immoral films, and the point of origin of two world wars. If you can answer those objections in conversation with them you have gone quite a long way.
We might also modestly think that the two countries of Asia with the highest standard of living - Thailand and Japan - have never been ruled by Europeans. If you except the period of the occupation of Japan after the second world war, and if you consider the position before 1939, Japan and Thailand had the highest standards of literacy and feeding in Asia, yet neither of those Powers had been ruled by Europeans. So it is not axiomatically accepted in Asian countries that we are the people who do them good.
A new situation is now emerging. We are going to see done in Communist propaganda towards Nehru what was done towards Chiang Kai-shek. There was a time when Chiang Kai-shek was regarded by liberal thought in the West as one of the great constructive figures of Asia, but systematically by propaganda everything that he did was belittled, and the difficulties of his country in regard to corruption were attributed to him. This is going to be done to Nehru, because the time has come when, after having been lulled by the visit to India by Khrushchev who endorsed his policy on Kashmir and his stand in relation to Portugal, he now sees in the penetration of Afghanistan and the violation of an agreement which was entered into with him five years ago over Tibet a new capacity to put intense pressure on India both from within and from without. We will see systematically the work of some new Owen Lattimore to prove that this tremendous legacy of corruption and difficulty which Nehru has taken over in India will be attributed to him in the same way as such difficulties were attributed to that other Asian statesman.
To absorb the East ideologically and militarily was a decision in 1948 of the Cominform, and the fate of Australia hangs on the question of whether that strategy is carried out. China had not, at that point, been taken over. The movement now towards Tibet, co-ordinating with actions in Afghanistan, is a very strong step towards the ideological and military absorption of Asia. Whether one agrees with Nehru or not one can at least see quite clearly in his policy that there is never any intention on his part to be hostile to communism, never any reluctance on his part to recognize Peking, never any desire on his part to be a pawn in Western strategy against the Communists in the East - and it has not made the slightest difference to their attitude to him! He is now accused of being the tool of the imperialists, and the pressure is on his country.
.- I want to make a short contribution to this debate. I do not agree with the contention of the honorable member for Fremantle (Mr. Beazley) that this debate has been of great value. Practically everything that has been mentioned in the debate I have heard before in this chamber or read in the newspapers.
– You have just heard a very good speech.
– I am not saying that the speeches have not been good, or that they have been unfair, but when it comes to a matter of their value, I say that one can read these things in our newspapers. We have been told things by honorable members who have visited the Near East and Far East and have gained certain information, but journalists have been writing up these items in the newspapers for months and months, and they are right up to date. Although I appreciate the opinions of honorable members who have been to these places and seen the position for themselves, after all, the things they have mentioned are common knowledge in Australia. I believe that it is important for members of this chamber to visit these countries, because they are able to get the feeling of the countries and certain knowledge that they can impart to fellow members. They gain a knowledge that other members cannot acquire by reading newspapers and listening to speeches.
I noted with some interest the speech of the honorable member for Reid (Mr. Uren), whose main theme was that we must ensure that we have peace in the world. Of course, everybody agrees with that. There is not a man in this chamber, or outside it, who would say that any thinking Australians are anxious to go into war. All Australians are anxious for peace. Truly, we are a peace-abiding people; we want peace.
– I am a lover of peace, anyhow.
– We hope that you are, especially when you go back to East Sydney, because in this chamber you say anything that comes into your mind. But the preservation of peace is not a matter of convincing what is known as the free world - the United Kingdom, America, and other countries with which we are so closely allied. It is a matter of great strategy and negotiation on their part in order to come to some agreement, if possible, with the Soviet Union to maintain peace throughout the world on just terms. But some of the speeches that I have heard in this place seeem to indicate that some honorable members favour peace at any price. I believe that I am as peace-loving as is any one in this country, but I am not in favour of peace at any price. One thing that I cherish more than anything else is the freedom that we enjoy in this great outpost of the
British Commonwealth of Nations. The fact that so many people from countries that had lost, or were in the course of losing, their freedom- have come to Australia as migrants indicates absolutely that people from other countries appreciate and value the freedom that we in Australia are able to enjoy.
This leads me to point out that we can achieve much by the way in which we treat those migrants, because they are continually in touch with people in other countries throughout the world. The impressions of our. treatment of them, of our environment and of the example- that we set in this country, which they will convey to the people of other countries, can do much to foster the peace of the world, if we give them worthwhile impressions to absorb. 1 say, at this point, that I do not believe that our Prime Minister (Mr. Menzies) has changed his mind in regard to foreign policy. It has been said- by quite a number of Opposition speakers that the right honorable gentleman has recently changed his attitude towards summit conferences. That is absolutely incorrect, and everybody should know that it is incorrect.
– He said it himself.
– That is absolutely untrue. The Prime Minister has not made such a statment on any occasion. A summit conference can be held only at an appropriate time. We cannot just rush in and call a summit conference as readily as we would call a meeting of the Foreign Affairs Committee of this Parliament. The Foreign Affairs Committee, incidentally, has no representatives of the Opposition, and it is difficult to have a discussion on foreign, affairs that would mean much to Australia unless all sides of politics are represented.
The Prime Minister has always said, so far as I have heard - and I have been present in this chamber every day to hear him - that- we roust work up to a summit conference. He has done much to attain that objective. It will be remembered that, on his recent trip abroad, the right honorable gentleman visited Canada and then interviewed President Eisenhower, of the United States of America, and Mr. Macmillan, the Prime Minister of the
United Kingdom!, before going to see Presi-dent de Gaulle, of France, and other world leaders. I believe that the Prime Minister’s trip did- much to pave the way for the present most successful visit of President Eisenhower to Europe and Great Britain and to France. There is not the slightest doubt that the Prime Minister of this country, who. is the leading Australian poli- i tical figure, is regarded most highly throughout the world. His journey to the United States, the United Kingdom, France and. other countries has been the forerunner of trips by other- world leaders. The right honorable gentleman- has set an excellent example, because he was the first leader of. a nation in modern times to travel from one country to another in order to extend the goodwill of his own country not only to countries that are members of the British Commonwealth of Nations but also to all the other countries of the free world.
I believe that if a summit conference comes about much of the credit will be due to the Australian Prime Minister, who has done so much to make such a conference possible, for he has fostered and encouraged the idea. After all, it is not something that you can bring to fruition all of a sudden; it has to be fostered and encouraged. Now that Mr. Khrushchev is to visit the United States, it looks as- if we shall have a worthwhile summit conference which will do much to bring to the world the continuing peace of which the honorable member for Reid spoke.
I shall turn now to the cold war. I believe that the Communists follow a policy of pushing their forces across isolated frontiers, just as the Chinese Communists are sending troops across the Indian border now, and I am sure that the presence of British Commonwealth forces in Malaya, where they are fighting the Communist terrorists and murderers in the jungle, has done much to stop the Communist tactics. We in this Parliament are used to seeing the Opposition in the forefront whenever negotiations and discussions take place, but it is found wanting as soon as action becomes necessary. The honorable member for Reid, earlier this evening, supported the sentiments expressed earlier in this debate by one of his colleagues - I forget for the moment who it was - who had said, in effect, “ We are still opposed to an
Australian force forming part of the British Commonwealth forces being used to fight the Communists in Malaya “. All sorts of kindly feelings towards the people of Malaya and their leaders have been voiced by both- Opposition members and Government supporters in this debate. Surely to goodness, then, we do’ not object to our forces, which form part of the Commonwealth: Strategic. Reserve, assisting: the Malayans- in their fight against the terrorists! 1 cannot for the life of me understand why any Labour member of this Parliament would be opposed to that. Anybody who wants to help the- cause of freedom and assist the people of Malaya, anybody who favours the cause of freedom and would outlaw communism, anybody who wants to help the people- of Malaya by assisting them to drive: the Communists out of the: isolated places in. the Malayan, jungles and beyond the borders of that country, must agree that our men in Malaya are doing a magnificent job.
I understand that all our servicemen who have been in. Malaya for an extended period will be back in. Australia for Christmas! Their casualties- have been extremely light, but the work that they have done has been of great value to the people of Malaya and of this country. The members of our forces in Malaya have been our best ambassadors there. I believe that the best way to spread goodwill in other parts of the world where Australia is not known is- to send abroad as many Australians as possible. Our servicemen in Malaya are serving a dual purpose. Not only are they fighting the Communist terrorists, but also they are establishing good relations and great goodwill between Australia and the Malayan people, with whom they, are particularly popular.
I have heard previous speakers in this debate say that Australia should do more for our near neighbours and should allocate more money for expenditure under the Colombo Plan. Has not this country contributed magnificently? We have heard Labour members in this place demand that the Government should spend more money on social services instead of spending money on the Colombo Plan, and, almost immediately afterwards, we have heard some of their colleagues ask why the Government does not spend more- money on the Colombo
Plan. They cannot” have if both ways-. They must express- an opinion one way oe the other, and it is high: time Opposition members- made up their minds about what they really think should be done.
I have had a good deal of personal contact with Malayans, and so have other honorable members in this chamber; including the Honorable member for Hume (Mr. Anderson), the honorable- member for Reid, the honorable’ member for Darling Downs (Mr. Swartz) and the honorable member for. Chisholm (Sir Wilfrid Kent Hughes). There is, after all, a world of difference between’ knowing something and- merely thinking it. Plenty of honorable members say what they think: is the situation that exists. Some people know the situation. We know that the Malayan people do not want to come to Australia and adopt the way of life of this country, and they do not want us to go to Malaya and tell them that’ they should’ live as Australians live; but I believe that they appreciate our. giving them the opportunity to learn the best ways of production. Through the Colombo Plan, as I have already said, this country is doing, and will’ continue to do, magnificent work.
I very much regret that to-night members of this Parliament have said, more or less, that this Parliament, this Government or this country has not been pulling its weight with other- nations- in helping underdeveloped countries. We must do it in an altruistic way. We cannot help these nations with the idea that they will buy a lot of goods from us if they raise their standards of living. It must be realized that the very fact that Japan is a lowstandard nation makes possible her buying of our wool at such good, prices as are being paid to-day. If Japan were a highstandard country, she could not compete as she is doing in the wool market. With her low standard of living she is able to make the wool into the finished article and sell it.
– In Russia.
– Somebody interjected “ in Russia”. Our trade agreement with Japan, her buying of our wool, and the selling of it in other countries, are the very things that - contrary to what the interjector implies - are keeping Japan away from Russia. The goodwill engendered by this Government with the other nations of the world, and the work of the Minister for External Affairs (Mr. Casey) have kept things on an even keel. I have heard it said that the Minister should be here in Canberra at this time, when negotiations and big conferences are proceeding overseas. I should like to ask members of the Opposition to cast their minds back to the time when the present Leader of the Opposition (Dr. Evatt) was Minister for External Affairs.
– He never left the House!
– He was hardly ever in the House. The honorable member for Grayndler, who is commonly known as “ Dillydally “, must mean by comparison with himself. We know that when he went overseas he was loath to return. He was Whip of the Labour Party, but he stayed away so long that his position became vacant and now it is occupied by the honorable member for Wilmot (Mr. Duthie). After all, you can put up with a certain amount-
The CHAIRMAN (Mr. Bowden).Order! The honorable member’s time has expired.
Proposed vote agreed to.
Department of the Treasury.
Proposed Vote, £11,539,000.
.- At this late hour we come to a consideration of the proposed vote for the Treasury. As you have indicated, Mr. Chairman, it provides for the expenditure on administrative and other aspects of the Treasury of over £11,000,000. If members of the committee will look at the schedule in the Estimates, showing the nature of the administrative make-up of the Treasury, they will see that the department is charged with looking after certain important aspects of the destiny of the Australian people.
It has been interesting to note during the past week the remarks, as reported in the daily press, of the Governor of the Commonwealth Bank, Dr. Coombs. There is a section of the Treasury that deals with banking, trade and industry. In Perth, at a congress held a week or so ago, Dr. Coombs pointed to one or two serious features, as he saw them, in the Australian economy. It might well be asked by this committee: Who ultimately is responsible for remedying the deficiencies that Dr. Coombs seemed to suggest existed in the Australian economy? He referred to inflation, which after all is the relation of prices to living standards and concerns the stability of the currency unit. Yet the very bank of which he is governor is supposed to be charged with maintaining the stability of the currency as well as supporting full employment. It has long been evident that the governor of the bank alone cannot do that. His is only a part of the mechanism which must be operated in order to produce the stability that the bank charter envisages. I suggest it is timely to ask, during the course of this debate on the Estimates, whether there is something wrong with the economic co-ordination existing in our economic structure.
I direct the attention of the committee to a very important document that has just “been published in the United Kingdom. It is the report of what is known as the Radcliffe committee, which was established by the Conservative Government of Great Britain nearly two years ago and charged with examining the monetary system in the United Kingdom. That body had just produced a very comprehensive report, the cover of which reads “ Command Paper 827 of 1959, Committee on the Working of the Monetary System, Report “. The report covers more than 300 pages, containing nearly 1,000 paragraphs. The index shows the sort of things that it regarded as coming within its scope for examination.
The committee looked at all the financial institutions in the United Kingdom, and particularly at the working of the Bank of England, which is the central bank in that country, corresponding with our Commonwealth Bank as we knew it or with the new Reserve Bank. It looked at the relationship between monetary controls on the one hand and what are known as fiscal or taxation policies on the other. It examined the very important question of the national debt. It realized that Great Britain does not live to itself, that it lives in a trading world, and that international repercussions are important in their effects upon the internal economy of that country. The committee looked also at the statistics that are cited from time to time by governments to endeavour to help comparisons of economic situations. 1 suggest that perhaps the time has come when there should be a similar systematic examination of the Australian monetary and economic system. Let us remember the inflation that has occurred in this country over the past ten years, which is progressing, perhaps more slowly than before, but nevertheless at a rate of about three per cent, per annum. Let us remember, too, that about 70,000 people, at the minimum, are unemployed now. It should also be. borne in mind that interest rates are continuing to rise, with all the resultant doleful consequences upon the economic life of various sections of the community. When all these things are considered, I suggest that it is obvious that something is wrong with the functioning of our economy.
It seems that the governor of the bank, who cannot altogether escape some degree of responsibility, is suggesting to the Government that there should be a much more systematic examination of some of these matters than has been the case up to date. When one considers the functioning of the Treasury, as an administrative organization, one sees that banking is one phase of its activities. It has a Budget and Accounting Branch, and it has a Finance and Economic Policy Branch. What is the degree of co-ordination between the Treasurer, or the secretary to the Treasury, and the governor of the bank, in regard to adjudication on these important matters? The governor of the bank from time to time makes reports upon the state of the nation. These reports are very welcome, and it is to be regretted that the report of the governor of the bank for this year has not been presented to the Parliament for consideration alongside the Budget papers when this important debate is taking place. I should think the report is very much overdue, and this surely calls for some explanation by the governor. We should be told why the annual report will be presented to us much later this year than in previous years. If my memory serves me correctly, in the last several years the report of the governor of the bank has not been received as late as, apparently, it will be received this year. Perhaps the governor has some excuse because of the dislocation that has taken place in his institution as a result of recent amendments of the banking legislation. Nevertheless, I suggest that there is a public duty, perhaps a statutory duty, upon the governor to bring that report before the Parliament at the time when we are considering the matters that are now before us.
What I read of the remarks of the governor of the bank indicated that he thought that some changes were necessary in the taxation structure of this country. The Government has indicated, in the course of the Budget debate, that it proposes to set up a committee of inquiry to examine our taxation structure. I hope that that committee will shortly get under way, and that it will provide opportunities for various sections of the community to present evidence on how they regard the incidence of taxation in Australia.
I believe, however, that what is required is more than a committee to investigate taxation. All these various matters have to be integrated together, and the committee in England considered all aspects of the problem. I would like to direct the attention of the committee to some remarks delivered recently by an American, the President of the Federal Reserve Bank of New York, Mr. Alfred Hayes, when addressing the thirty-first annual mid-winter meeting of the New York State Bankers’ Association, on 26th January, 1959. Mr. Hayes said: -
I would be the first to admit that there is a vast amount we don’t know about the detailed techniques of monetary policy - about adequate measures of liquidity, in and out of the banking system, about the effect of varying liquidity upon our own monetary measures, about the extent to which non-bank credit agencies, private and Government, may lie beyond the effective range of our activities. These and many other problems deserve the kind of long-range disinterested study which the Radcliffe Committee is devoting to them in Britain, and which the Committee for Economic Development is endeavouring to initiate in this country.
Let me suggest that if it is felt in the United Kingdom and in the United States of America that there should be an expert committee making exhaustive examinations of these kinds of deficiencies in the economies of those countries, such a body is even more important here, because if those deficiencies exist in the two countries I have mentioned, then they exist in greater degree here, .because ;of ;the nature of .our federal constitution. There are very significant sectors of the Australian economy .that .it .is difficult to control. Hire purchase is only one example. All .that ‘this Government does is to watch the rate of hire-purchase interest constantly accelerating, and it does ‘nothing whatever about it. It has to climb on to the escalator itself when it seeks to raise its loans, either internally or externally. The result is that the whole cost structure is seriously affected. We have heard many people professing to be very worried about our cost structure, particularly when the element concerned .is wages, but they do nothing whatever ito change this serious set of .circumstances that exists here at present.
– Is not hire-purchase a matter that Is controlled by the States?
– It is not controlled completely, unfortunately, by either the States or the Commonwealth, and the problem requires an intelligent application of partnership between the two, which this Government has done nothing to promote.
– Some States have established controls.
– Some States have endeavoured to control the situation, but none has been very successful, because this is not the kind of thing that can be controlled in six different places. The control has to be a central control. Let me suggest that the Minister would be “well advised, as would other members of the Cabinet, to study the document that has been brought out in the United Kingdom, so that he may see how closely integrated these problems are. He may then understand that the left hand of the Treasury cannot separate itself from the right hand of banking in this community. The two have got to move together. The two must be better co-ordinated. At least one person who is free to make an expression of discontent has already expressed that discontent. I refer to the governor of the bank. I would say that his words are very timely, and that they should be weighed very carefully by those behind the Government who are responsible, sometimes, for some of these changes in our economic life.
We have [recently had one Treasury idea turned loose upon .the .public, namely, that the Post Office, in future, should he regarded, not as a public utility, but as a business enterprise; and that it should get a notional return of interest on capital that came out of the hides of the taxpayers in the first place. That is a Treasury theory that will put £11,000,000 more into the Treasury, the money coming out of the pockets of the Australian people by way of increases in telephone charges, letter postage charges and other charges. Ideas such as this should not be evolved in darkness.
.- I do not intend to traverse the subject of our economic structure, as the honorable memher for Melbourne Ports (Mr. Crean) has attempted to do. I wish to direct my remarks to one of the most important items of indirect taxation, namely, sales tax. I realize that the approach in this year’s Budget to the question of sales tax was one of maintaining the status quo, but there are still quite a number of aspects of the sales tax structure which are unsound in principle or in relation to which the interpretation of the relevant authorities is unbound.
I wish to deal with three items in particular. One is what is known as the returnable and reusable container. These containers are returned after original use, refilled, and then sent out again. On each occasion the container is sent out, sales tax is payable on the container and its contents. Another item in this category is the kind of sign board that is prepared by a signwriter from wood and iron and is painted according to the requirement of the customer. Sales tax has to be paid on the original board, the paint used, and the labour involved in the signwriting.
– Has the honorable member an agency for these boards?
– No, but 1 wish I had. Such boards are usually used by Teal estate agents when auctioning a property and are in use for only two or three weeks. Then the board is returned and the signwriter places ‘it back in his store. He paints out the original sign and rewrites the board in accordance with the order of the next hirer and -it goes out for another three weeks. But sales -tax has to be paid again on the wood and ‘iron in the original structure when the only extra cost involved lis that of ‘the paint ;and labour used in the rewriting. As I understand .the situation, it is not a principle of the act that sales tax should be paid .on labour. The Commissioner of Taxation has ruled that rewriting constitutes the manufacture of new .goods :and that tax is payable .at the rate of I2i per cent. This matter causes a lot of difficulty and trouble in the trade, and it is thought that a remedy could quite .easily be effected by .an addition to the definition of “ goods “ in the Sales Tax Assessment Act No. 1 along the following lines: -
For the purposes of this definition, signs or placards shall be deemed to have gone into use or consumption in Australia by reason of their first use in Australia as signs or placards, and shall be deemed not to become goods by reason of their being subsequently rewritten or repainted.
This is an anomaly which could be remedied by a simple amendment. 1 wish to raise, too, the payment of sales tax on flags and bunting. It seems to me to be rather peculiar that national flags should be exempt from sales tax but that flags and bunting used by boy scouts’ and girl guides’ associations and similar organizations should be subject to a tax of 12£ per cent. We have the peculiar situation that boy scouts must pay 12i per cent, extra for a flag but that the Communist who wants to By the “ Hammer and Sickle “ is not obliged to pay sales tax. I agree, of course, that flags and bunting used by business people for advertising purposes should attract sales .tax.
– Evidently the Government favours the Communist flag.
– Apparently it does. You should get one. /I wish to refer now to the sales tax that is payable on hire cars and taxi cabs. These vehicles must be registered as commercial vehicles and must be used as such, yet they are subject to the 30 per cent, luxury tax that is payable on private vehicles. If Australian taxi cabs were to conform in style to their English counterpart, they would attract only the commercial rate of tax. However, the people of Australia have shown that they are not in- clined to use the English type of taxi cab but prefer the private style of vehicle. It must be remembered that the persons affected by the imposition of this high rate of tax .are not the big cartels and organizations that our friends opposite talk about tout the dozen or more ex-servicemen who constitute the various co-operatives that run these taxis. It boils .down to the fact that they have to pay :a 30 per cent, tax simply because the public prefer the private style of ‘vehicle .to :the straight-out cab type, whereas people who operate a taxi truck business for the transport of goods pay only the commercial rate of 161 per cent, while, as I have already stated, the people who transport human beings have to pay a tax of 30 per cent.
In each State there is a vehicle transport association which, after the expiry of twelve months from the time of purchase, could perhaps give a certificate showing that the cab had been used commercially for twelve months. Upon that .certificate being submitted to the sales tax authorities, with an appropriate application, the department could very well refund the difference between the 30 per cent, and the 16£ per cent. Action along those lines would prevent trafficking in motor vehicles in order to avoid the payment of the higher tax.
Other anomalies come to mind, too. I am thinking of toilet articles used in the home, and various foodstuffs such as jellies and ice-creams. The man who has a large family and who therefore uses more of those commodities pays more in indirect taxation than does the man with a small family. There are many such anomalies which call for investigation. I wish to move now to a form of direct taxation - the pay-roll tax. This tax has been condemned by honorable members on both sides of the chamber as being inequitable and unjust.
– The consumer pays for it.
– The point I want to make is not that the consumer pays for it but that there is an error in principle in applying it to municipalities. The ratepayer pays a State tax in the form of rates to ‘enable the affairs of the municipality to be ‘carried on. (But the wage content of that money is in turn subjected to a federal tax. It is, in effect, a tax on a tax, and is therefore unsound in principle. State governments are placed in the same situation as are municipalities, but that should not prevent the correction of a matter which is wrong in principle. This Government pays a pension to the pensioner, who in turn uses part of that pension to pay his rates. Part of that tax in turn is subjected to a federal tax. Where does it finish? It seems to me to be a stupid circle. These anomalies have long been a source of irritation to many people in the community, and I sincerely hope that the Treasurer (Mr. Harold Holt) will be able to see his way clear to remedy them immediately and not postpone them from year to year as has happened in the past.
.- The subject which I wish to bring to the notice of the committee concerns the taxation of private companies. An amendment to the act was foreshadowed by the Treasurer (Mr. Harold Holt) in his Budget speech. However, this amendment deals with the increased amount now allowed for the retention fund, and the procedure for determining the tax which will finally be paid by a private company has remained unchanged. The procedure at the moment is that a private company, after following the formula and allowing a certain amount for a retention fund must distribute the remaining profits for the financial year within a prescribed period. The prescribed period commences two months before the end of a financial year and ends ten months after the end of a financial year. If a sufficient distribution, as it is known, is not made within that prescribed period, an additional tax of 10s. in the £1 is charged on the amount still outstanding.
In certain instances, this procedure, when it is adopted, reacts harshly and unjustly on some private companies, because sometimes a private company is not in a position to know exactly what its sufficient distribution will be within the prescribed period. Sometimes the fact that the company does not know its sufficient distribution is not the fault of the company but the fault of the Taxation Branch. I feel that this is a matter that the Government could well look at, in view of the fact that it has seen fit to foreshadow an amendment 10 the method of determining the tax for private companies. The ways in which a company can find that it is in a position, after the prescribed period has elapsed, of not having made a sufficient distribution are these: First, if a notice of assessment has not issued before the close of the prescribed period; secondly, if an amended assessment increasing the previously notified taxable income, and automatically the sufficient distribution, is issued after the prescribed period has elapsed; and thirdly, if an objection, reference to a board or appeal to a court is pending.
In some cases, these three developments can occur years after the prescribed period has expired. The company has no opportunity to allow extra dividends or to make any extra distribution because the prescribed period has elapsed, and consequently the Government is able to take an extra 10s. in the £1 out of the amount that ti still remaining after the distribution has been made. The case that I shall cite ?.s an authentic case and I shall give details to show exactly what can happen under the act as it is at present.
The company concerned lodged a taxation return for the year ended 30th June, 1954, within the extension of time allowed to it. The return showed a deficiency for taxation of £99. It appeared on the basis of the return lodged that no tax would be payable and hence there was no need to distribute any part of the profit and loss account as dividend to avoid additional tax on undistributed profits. A notice of assessment of £3,054 primary tax was issued on 29th March, 1956, in respect of a taxable income of £11,845, this being arrived at by the inclusion of £11,944 as assessable income. This was an amount regarded by the company as non-taxable and it was shown in the books and in the balance sheet filed with the return as capital reserve. On 22nd May, 1956, an assessment was issued for Division 7 additional tax of £3,021, which was made up as follows -
No dividends were allowed because the company had lodged a return which showed a deficiency for taxation of £99. The undistributed amount subject to the 10s. in the £1 tax was then £6,043. Objections were lodged against these assessments on 28th May and 18th July, 1956. On 17th December, 1957, the Deputy Commissioner advised that he had decided to disallow both objections. On 6th February, 1958, the company advised that it was dissatisfied with these decisions and asked that they be referred to a board of review. The matter stands at that position at present; many months may elapse before the board’s decision is known. Even then, either the company or the Commissioner may take the question to the courts, so that years may elapse before any finality is reached.
One point clearly emerges from this: If the decisions of the board or the court go against the company, it has lost all right to distribute any part of the £6,043 so as to avoid payment of £3,021 additional tax. In this case, the taxpayer is penalized because the primary assessment was not issued until 28th March. 1956, eleven months after the end of the prescribed period, and the decision to disallow the objections was not conveyed to the taxpayer until December, 1957, one and a half years after the objections. The matter is now subject to appeal, which may take many years to determine. It is true that the company can declare a dividend now or in the future and this will be regarded as a distribution for some subsequent year. But there may never be taxable profits again or the company may cease to exist. On the return lodged the company expected that it would have no occasion to declare dividends either from the profit and loss or capital reserve accounts. The fact that an assessment had not issued by the end of the prescribed period, which was April, 1955, did not necessarily put the company on guard, as it was entitled to assume that no assessment would issue because of the deficiency shown in the return.
The Taxation Branch does not give any advice to a taxpayer when a return is not taxable, and even if a loss shown in a return is varied by the branch, this is not known until some subsequent year, if and when the loss is recouped from later profits. The matter is even more harsh if a primary assessment has been issued and, replying on it, a company has declared sufficient dividends to avoid the 10s. in the £1 tax and then, maybe years later, the branch issues an amended assessment increasing the taxable income. There is no further time in which to declare dividends to avoid the 10s. tax on the amended and higher sufficient distribution figure. As the act stands, there is no way for additional time to be granted for the declaration of dividends in the three circumstances that I outlined earlier. I feel that there must be a time limit to protect the revenue. If there were not, companies could refrain from declaring dividends for years. But, in the absence of an assessment before the prescribed period has expired, or in the case of a subsequent amendment, the act is harsh in not permitting some extended period in which to declare further dividends which can be taken into account in ascertaining for the year involved the amount which is subject to additional tax.
I ask the Minister for the Army (Mr. Cramer), who is now at the table, to place this matter before the Treasurer if and when he returns to Australia, so that the act may be amended to allow an extended period for the declaration of further dividends in cases similar to the one that I have outlined.
.- Like the honorable member for Melbourne Ports (Mr. Crean), I welcome the decision of the Government to set up a committee to inquire into all forms of taxation. I understand that, so far, no decision has been made as to the fields of taxation that will be covered, and I want to make a plea to-night for this committee to make some of its first inquiries into what is undoubtedly the most chaotic form of taxation in Australia at the present. I refer to probate and estate duties. In spite of the fact that there has been a general move towards uniformity in taxation - for example, we now fill in only one income tax form whereas 25 years ago we filled in a return for each State from which we derived income as well as one for the Commonwealth - the position in regard to probate and estate duty to-day is far worse than it was 50 years ago. At that time people paid estate duties only to the States, but in 1915, probably in order to help finance World War I., the Commonwealth introduced probate duty and estate duty. To-day there is a chaotic overlapping in the various
State: and Commonwealth taxation fields. This Parliament; has now under considera- don– a- unified matrimonial causes? bill and if it passes into law there will be only one statute throughout. Australia, dealing with matrimonial causes. But in every State as well as- in the Commonwealth there are different acts dealing with probate duty. It is not necessary for every one to get a divorce, but it is necessary sooner or later for every one’s estate to pay estate duty. Indeed, probate cannot be granted until if is paid.
There are many anomalies and shortcomings in the field of taxation and I should like to draw attention to some of them. Perhaps it is not even necessary for me to point them out. I regard an Australian as an Australian irrespective of where he lives or where he dies, but the various acts dealing with probate and estate duties do not do so. My electorate is- in the southern part of New South Wales and. much of it is considerably closer to Melbourne than it is to Sydney. If a man on the land in that area retires and leaves his family to run his property, unless he chooses to live in one of the lovely cities of Wagga or Albury he will probably retire to Sydney or Melbourne. If he should die in Melbourne; because his property is in New South Wales his estate is charged a higher rate of probate than if he died in Sydney although his property is closer to Melbourne. Taking this further the estate of a person who dies in Canberra pays considerably less probate than if the deceased had resided in Melbourne or Sydney. I feel that the tourist bureau in Canberra has lost a very good opportunity for advertising one of the important amenities of this city. One sees all sorts of slogans such as “ Come to Canberra and see the blossom “ but what could be a better advertisement than the picture of a grave with a sprig of wattle at the head and underneath it a slogan such as, “ Die in Canberra and save half your probate duties “.
As I said before, surely an Australian is an Australian irrespective of where he lives or dies. Why should there be this absurd differentiation, between people who die in Canberra and those who die in the different States? That is one of the first anomalies; there, are many others. For example; in some States” a person can make his’ will so1 that.his.widow gets a. life: interest and his children the balance- of the estate. Surely, this- is a just way for a man to make provision, for his wife- if he should die before her. But in some States, if that happens, extra- probate is charged once again when the widow dies. Consequently, the testator is forced to leave his estate to his- children and guess how long his widow will live after him and how much she will need to enjoy a reasonable degree of comfort and security. Again, in some States the estate of a serviceman killed in action does not pay probate, but in other States it does. I know of cases in which the estates of servicemen’ who have been killed in action have paid’ a second probate within a few months; or even a few hours, after the first probate was granted. The: effect was1 that those estates: were forced to pay. a double amount of probate.
The State- and’ Federal authorities all have a finger in the pie: There are far more civil servants dealing with probate and estate duties than would be necessary if there were only one body to deal with this matter. I have even had cases reported to me in which State authorities have accepted a valuation and months or years later, when a re-seal of probate was sought in the Commonwealth jurisdiction, the Commonwealth has refused to accept a revaluation. I know of one case in which a person sold a few dairy cows and showed the figure received as part of the valuation of the estate. Months later, when Commonwealth probate was asked for, he was told to get these cows revalued. Where they were by that time he did not have the faintest idea. This sort of procedure leads to what one could describe as a lawyer’s harvest. It is almost impossible, in the case of a reasonably sized estate, particularly where assets are in more than one State, to get probate granted sooner than two years. I have heard of cases of considerably longer periods, even up to five years. This holds up the entire administration of the estate during that time and. increases considerably but unnecessarily, the costs involved.
The question to be considered is: Which authority should vacate this field? Obviously one has- to get out; both Commonwealth and States should not be entitled to have a bite at the one cake. Probably the first reaction of honorable members would be that since this used to be a State field it should be handed back to the States and the Commonwealth should vacate it. But if that were done, none of the anomalies and shortcomings that I have spoken about would be rectified. I have referred to several of these anomalies. One is the tremendous lag of time in getting probate granted in one, two and possibly three States. There would still be the multiplicity of State public servants all having a finger in the pie and each State possibly requiring a revaluation.
If one examines this -matter closely one cannot -help coming to the .conclusion that if we want to get rid of this chaotic state of probate .and estate duties the -proper course is for the Commonwealth to approach .the States and say, “ We will reimburse .you to the extent .of -your income from estate duties now and we will take over this .field “. If ;necessary, the Commonwealth could hold .out a .bait .and say, “ We will give you a .little bit .more than you are getting at present provided you vacate this .field .of .estate .duty .and allow the Commonwealth .only to .administer it “. Another reason for such a move is that the Commonwealth Government is .the only government which handles gift duty. As honorable members know, there is a distinct -tie-nip between gift duty and estate duty. <Gift duty .was introduced -in -order to prevent people who -were ‘getting on in years ;from handing over .all their estate to their family so that when they died they would appear to be poor and so escape paying estate duties. The ‘Commonwealth is already in that .field. Surely it should take over the entire ifield :of probate and estate duties. This is not a big field and the income from it will not fluctuate violently. J think the total income gained by the States and the Commonwealth would be in the vicinity of about £10,000,000-1 am only guessing at that figure. Surely we could avoid all the .mess and chaos that is caused at present if the States .vacated -this field and handed it over entirely to the Commonwealth.
I hope that when the -committee on taxation inquires into estate ‘and probate duties, as I ;hope it will very shortly, one -of ‘the people who will be called to assist it will be ,the ‘Attorney-General (Sir Garfield Barwick). I am sure honorable members realize that ‘no one .has succeeded in saving more tax for his clients at one time or another than has the honorable gentleman. For that reason I think he would be highly qualified to assist the committee.
Finally, I appeal to the Treasurer (Mi. Harold Holt) to make a slight amendment to cover the case of a forced sale for probate. Honorable members may recall that in 1952, after some very severe bushfires, a problem which had not been foreseen cropped up. The taxation law lays down that people must show the value of the natural increase in their stock at a fixed figure. There was a considerable discrepancy between the value of the stock shown in the books and the figure at which they were actually sold. There were people .who had stock burnt to death in bush fires. They had insured the stock and were paid quite a bit more than the figure at which the stock was valued for taxation purposes. Immediately the Commissioner of Taxation descended upon those .unfortunate people, who would normally have used the insurance money to restock, and said to ‘them, “ You have made a profit; you will ‘have ‘to pay income ‘tax on that profit at the -end of ‘the year “. The Treasurer and the Commissioner ‘for Taxation went into -this matter and, very wisely, they agreed to spread this book profit over a period ‘of five ‘years ‘in ‘a case where there was ‘loss owing to ‘a grass fire, a -bush fire or -a flood.
I am asking that a similar provision ‘be applied to cases where a forced sale of stock is necessary in order to find the money to pay probate duty. There was recently brought to my notice the case of a person who, in order to find a large sum of money to pay probate duty ‘in respect of an estate which he was .managing, had to sell stock and was required, in the year of the sale, to pay income tax on the proceeds. I feel that the decision to .which I .have referred to spread the tax over a period of five years is a very wise one, but this procedure does not only -apply to cases of the type that I ‘have -mentioned. If a writer, for example, takes a certain time to produce a “book, he is allowed, for the purposes of income ‘tax, to spread the profit that he makes ‘from the sale of the book over ‘a period of three years.
I ask that a similar provision be applied in cases of forced sales of stock in order to pay probate duties. I have been reliably informed that the cost to the Treasury of such an amendment of the act would be very small indeed - probably only £50,000 a year. I believe that we should make this amendment, because it would be just to do so.
.- I should like to take up some of the points made by the honorable member for Melbourne Ports (Mr. Crean) when he showed the very close connexion that exists between the Treasury and the banking system. He said that it is impossible to separate the right hand of the Treasury from the left hand of the banking system. It is quite impossible for a member of Parliament, or a citizen, to know the extent to which the Treasury is responsible for decisions that are made by the Government, or the extent to which it acquiesces in, ignores or originates those decisions. However, it is pretty clear that what has been done in relation to financial policy in recent years is quite orthodox. lt is acceptable by those with orthodox minds, by those who have had an orthodox training, and we know, of course, that the Treasury is amply supplied with people who have been trained in the field of orthodox post-classical economics. It is fair enough to assume, therefore, that what has been done in the direction of financial policy is what we would expect from those with such a training.
The essential judges of whether this financial policy is correct or proper will, of course, not be the Government, the Treasury, the private banks, the financiers or, for that matter, the Opposition. The judges eventually will be the people. I think it is necessary, therefore, for us to endeavour to clarify as much as possible what has been done in a number of important fields of financial policy, so that those who eventually will have to judge whether the policy is proper and as it should be, will have the best opportunity to judge.
The Commonwealth Budget relates to a flow of money through the economy totalling this year £1,682,000,000. That is the sum on the receipts side, and there is a similar sum on the expenditure side. It represents over a quarter of the total national expenditure. Being a flow of expenditure, it is particularly related to the circulation of money in the economy. The supply or circulation of money in the economy is not dissimilar to the circulation of blood in the human body. One is just as essential as the other. Until 1945, the circulation of money in the economy was a matter for the private banks and the financiers to control and determine, but the harmful effects of this led to a general recognition of the need for a system or regulation, applied by the Government through the Treasury.
The essential feature of that system of regulation became known as the special accounts system. The special accounts system, which is coming gradually into disuse, required the private banks to hand over to the central bank any surplus money which had been created or put into circulation. Otherwise, this money would have been used for further circulation, resulting, on the one hand, in higher profits to the banks concerned with the circulation, and, on the other hand, in higher prices, or inflation. These were the principles underlying the introduction of public control and the introduction of the special accounts system.
During a time when expenditure was considerably higher than the changing levels of the cost of goods and services, the amount of money held in the special accounts grew. In 1950-51 it was just over £500,000,000. The orthodox view, Mr. Chairman, is that this money in the special accounts is the property of the private banking system. The view which is at present unorthodox, but which will be orthodox in ten years’ time, is that this money is the property of the community, that it is a system of circulation which is not the private property of the private banks, that it has a particular social and public use, and that its level or its nature must be determined by the public interest, not by the private interests of the banks or other institutions. That is at present an unorthodox view, but it is a view that will have general acceptance within ten years of this date. There can be no question about that.
The essential principle was to release money when it was needed by the private banks to lend to the public - to release from these accounts sufficient money to provide the banks with liquidity for the purposes of their ordinary banking transactions. The principle established by the Chifley Government was that money was never to be released from the special accounts merely for the private banks to lend back to the Government. For the greater part of that time, the private banks were not permitted to buy government securities through this process. However, last year very significant releases were made from the special accounts, not for the purpose of allowing the private banks to lend the money to their customers, but for the purpose of allowing them to help to create what was called a short-term money market for the purpose of buying government bonds. The effect of the releases was to give the banks added capital and added interest, and to allow them to lend the money back to the Government. The special account balances were allowed to fall continuously from £324,000,000 in March, 1958, to £249,000,000 in June, 1959- a fall of over £70.000,000 in that period. Did the banks need that money for their ordinary financial transactions? Presumably they did not. The “Australian Economy, 1959,” an official publication, states on page 19 -
For trading banks generally, liquidity would not appear to have been a limiting factor in the making of new advances.
In other words, they had sufficient liquidity to make new advances. But they were given an additional £70,000,000 and, having obtained this increased liquidity, one might have expected that they would have lent more to the public. But they did not. Their advances were shown officially in September, 1957, to be £948,000,000; in December, 1957, £932,000,000, and in March, 1958. £885,000,000. There was a continual drop in the amount of advances that the private banks made to the public, and it was not until June of this year that the amount rose to £916,000,000. Bui even ‘ then the figure was still well below that for September, 1957. Therefore, the trading banks did not lend more money to the public as a result of obtaining this release from the special account. To whom did they lend their money? The answer is obvious! They lent their money to the Commonwealth Government. The “ Australian Economy, 1959 “, also has this to say -
Besides this, local loans have attracted very large subscriptions from the trading banks and also from the newly-established short-term money market . . .
Last year we were not able to obtain from the Government any information as to how much had come from the trading banks on the new short-term money market, but we were able to work out from the Budget that the actual deficit last year between expenditure and receipts was about £297,000,000- the same is expected for this financial year. This figure is enormous, and must be made up by borrowing in some form. Last year the Government borrowed about £11,000,000 from the public; about £50,000,000 from the central bank, and over £200,000,000 from the trading banks and other large lending institutions. The point I want to make clear is that this process of releases from the special account to the private banks and. in turn, their purchase of Government securities, is exactly the same kind of financial process as that by which the Government borrowed directly from the Commonwealth bank by the issue of treasury-bills. There is no economic difference in the new process except that the private banks intervene. However, borrowing from the private banks is much more costly to the Government and much more inflationary than borrowing from the Commonwealth Bank because the Government pays 4 per cent, or 5 per cent, interest to the private banks and only 1 per cent, to the Commonwealth Bank. Therefore, the private trading banks and their associated financial institutions show an additional profit during the year of about £3,000,000 or £4,000,000 in interest charges, and about £50,000,000 or £60,000,000 in additions to their assets. This is possibly the greatest hand-out of profit and capital that has ever been made in the history of Australia.
The process of setting up a short-term money market and so on, is merely a process by which public credit is made available to private individuals - the private banks and their associated lending institutions - for their own profit and for the growth of their own. assets. It is completely unnecessary for Government financial purposes. As I pointed out a few moments ago, the view that I am putting is one which, those trained in the orthodox methods of economics are not prepared to accept. It is a view which those who make their profit and income from the private trading banks and’ their associated financialinstitutions are not prepared to accept. But it is a common-sense proposition which the average person, if he thinks about it for a while, will recognize as such. Sooner or later we will return to the position that was explicit in the- Chifley legislation; We will recognize that the volume of money which flows through the system is not for a private purpose but for a particular public purpose namely, the achievement of particular levels and directions of activity, and’ that this, from time to time, leaves a surplus which must be held in a public account. This surplus therefore is not the private property of the banking system - the right hand or the left hand of the Treasury which has created this surplus - bur is, in fact, public property and should not’ be handed over to the private banks unless those institutions intend to use it for a public purpose. That public purpose does not include the lending back of that money to the Commonwealth Bank through the purchase of Government securities,, as we have witnessed over the last twelve months.
This is one of the important matters that we should think about when we are discussing the activities of the Treasury. A standard was fairly well established by the Chifley Government but in recent times there has been a very serious drift fromthat standard. This drift has had’ two main effects: First, it has contributed very substantially to the inflation that we have experienced during that period, and secondly, if has allowed the growth of a large volume of profit in the hands of the trading banks and other lending institutions,, which the Chifley Government successfully resisted and kept within reasonable limits. We want to see the- Chifley Government’s attitude re-emphasized so that the- effects may. be- understood clearly by those- involved!
– Order! The honorable member’s time has expired.
House adjourned at 10.59 p.m.
The. following answers to. questions were circulated: -
s asked1 the acting Treasurer; upon notice’ -
What salaries or fees and allowances have Been fixed for the (a) Governor, Deputy Governor and members of the Reserve Bank Board and (b) Managing Director, Deputy Managing Director and members of trie Commonwealth Banking Corporation Board?
– The answer to the honorable member’s question is as follows: -
e asked the acting. Treasurer, upon notice -
– The answers to the honorable member’s questions’ are as- follows: -
Court Case, under. Re-establishment and. Employment, Act.
rd asked the Attorney-General”, upon notice^ - 1”. Is it. a fact that- the effect of! the’ High: Court-, decision in the1 case of’ Wickham’ v. Illawarra. County’ Council is1 to declare- the Commonwealth’. Re-establishment’ and Employment’ Act to- be invalid?’
– The answers to the honorable- member’s questions are as follows: -
s asked the Minister for Labour and National Service, upon notice -
– The answer to the honorable member’s questions is as follows: - 1 and 2. I have seen Mr. Brown’s article and it has been studied by my department. AH familiar with employment and unemployment statistics know the great difficulties that between census dates confront those responsible for their compilation and that between census dates exact reconciliations are virtually impossible. I only add that my department is in close touch with the Commonwealth Statistician about the whole matter and that if the honorable member would like to pursue the technical problems involved he could contact the Commonwealth Statistician.
z asked the Minister for Territories, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Minister for Supply, upon notice -
– The answers to the honorable member’s questions are as follows: -
Regular car drivers in the Department of Supply are normally engaged on pool driving duties, and whilst this experience does not in itself completely fit them for the duties associated with a royal visit it certainly made it possible for the additional training to be completed in a minimum of time. 3. (a) Training courses were carried out in Melbourne, Sydney and Brisbane, (b) Ninety-four drivers attended these courses, (c) Duration of course was as follows: - Melbourne, four days, two evenings and one Saturday morning; Sydney, a total of six days; Brisbane, four days, (d) Subjects included in the courses were: - (1) Ceremonial driving, (2) convoy driving, (3) use of Royal standards and insignia, (4) instruction in driving and maintenance of Rolls-Royce cars, (5) use of inter-car radio telephone equipment,
n asked the Minister for Social Services, upon notice -
How many persons who have been granted age and invalid pensions since November, 1955, have been refused free medical and hospital benefits?
– As the above question concerns the administration of my department, the Minister for Social Services has referred the question to me for attention, and I furnish the following answer: -
During the period 1st November, 19SS, to 30th June, 1959, 326,221 persons were granted age, invalid, widows’ and service pensions and tuberculosis allowances. Of these persons, 72,759 were ineligible for the Pensioner Medical Service at the time of grant of benefit. Some, through a change in their means, have since become eligible for the benefits of the Pensioner Medical Service and many others are no longer pensioners. In general, except in Western Australia, pensioners enrolled in the Pensioner Medical Service receive free hospital treatment whilst occupying beds in public wards of public hospitals. In Western Australia, all uninsured pensioners are charged a net hospital fee of 8s. per day in public wards.
Cite as: Australia, House of Representatives, Debates, 3 September 1959, viewed 22 October 2017, <http://historichansard.net/hofreps/1959/19590903_reps_23_hor24/>.