House of Representatives
5 September 1961

23rd Parliament · 3rd Session

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

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– I desire to ask the Prime Minister a question without notice. Now that Russia has suddenly, and without the least indication of the many months of preparation that must have preceded its action, resumed the regular explosion of atomic bombs and has thereby heightened international tension and threatened humanity everywhere with death and destruction from radio-active fall-out after each explosion, will the right honorable gentleman enlarge the scope of the statement that he proposes to make on the Berlin situation, and outline the Government’s policy on this latest development; also on the broader question of banning nuclear tests and on the general question of disarmament, even if by doing so he has to delay for a day or two the making of his promised statement to the House?

Prime Minister · KOOYONG, VICTORIA · LP

– I have been, as it happens, giving some thought to this matter only this morning in discussion with some of my colleagues. It seems to me that there are two phases of this. One is to set out the historic facts in relation to Berlin and the problems that arise from it and also to set out the sequence of events relating to the Geneva conference on the banning of atomic tests or the lifting of the ban. The other point is that there are subsequent questions which arise, as the honorable gentleman says, from the explosion of a bomb or bombs by the Soviet Union, which perhaps would lend themselves to separate treatment here. I do not at all dissent from that view, but I think that as things happen so swiftly and the situation changes from day to day, it might be of advantage to put down the purely factual statement for the information of honorable members and the public, say on Thursday night - which need not provoke a debate - and to make a statement, perhaps next week, having regard to what may have occurred as a result of whatever reply comes to the propositions made by President Kennedy and Mr. Macmillan; that is to say, to make a separate statement, and to have a debate in which honorable members may participate at that stage.

Mr Calwell:

– Two statements?


– Yes. But I think it might be advantageous if, before the day comes I have a word with the honorable member. I want to make the statement in circumstances which will afford the maximum of objective information and at the same time enable members of the House to offer their views adequately. Therefore, as we have the same object in mind, perhaps if I have a talk with the honorable member later on we might arrange something.

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– I wish to ask the PostmasterGeneral a question. In view of the numerous complaints from television viewers about the changed procedure in weather reporting over station ABV 2, will the PostmasterGeneral consider reverting to the original procedure, which was to employ officers from the Commonwealth Bureau of Meteorology to make such reports?

Postmaster-General · DAWSON, QUEENSLAND · CP

– It so happens that 1 noticed some reference in the press to this matter. It is not my function as Minister to direct the Australian Broadcasting Commission as to the nature of its programmes, and I do not assume any such responsibility. Nevertheless, I made some inquiries about this matter and found that the position is briefly this: Since the beginning of television in Sydney and Melbourne, it has been the practice for weather reports to be made by officers from the Bureau of Meteorology. The commission, quite rightly I believe, considers that this is primarily one of its functions. In fact, radio broadcasts of weather reports are made by the commission’s officers, and in Brisbane, Adelaide, Perth and Hobart, television presentations of these reports are made by the commission’s officers.

As the commission considers that it now has the staff in Sydney and Melbourne to present these programmes, it has decided to change to the procedure adopted in other cities. In doing so, the commission has taken full advantage of the offer of the

Bureau of Meteorology to supply the necessary material and to brief the commission’s officers in the presentation of the material. On that basis the change is, I think, sound, but I assure the honorable member that the commission will carefully watch the development of the transmissions in Sydney and Melbourne, particularly as the announcers gain experience, to ensure that viewers will receive as good a service as that provided in the past.


– My question, which relates to television and the very unsatisfactory broadcasting service provided for residents of Eyre Peninsula and the northern area of South Australia, is directed to the Postmaster-General. He will no doubt recollect receiving correspondence from me on this important matter. I ask whether he is now in a position to furnish me with any information relating to booster stations or any other method that may be adopted to ensure that people who are not privileged to live in the cities receive at least a satisfactory television service.


– The honorable member for Grey refers to previous representations he has made to me on this subject. It is correct that we have had several discussions and some correspondence on the matter, but the position is as I outlined it to him previously. This area, in common with many other areas, has not yet come within the scope of our expanding television service, but I have no doubt that it has been considered by the Australian Broadcasting Control Board, the Post Office and the Australian Broadcasting Commission in the investigations, which have been proceeding for some months, into the fourth phase of television and broadcasting generally. The report from these bodies regarding the extension of the television service has just reached me. It will be considered by Cabinet within the next few weeks and I expect to be able to make a statement within a month or so. Although areas such as that mentioned by the honorable member have been considered by the bodies to which I have referred, that does not mean that the particular localities mentioned by the honorable member will immediately receive a television service. However, the matter will be given attention.

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– I direct a question to the Minister in charge of the Commonwealth Scientific and Industrial Research Organization. Was a meeting held in Canberra last Friday to discuss a ban on the use of fibroma anti-myxomatosis vaccine? If so, what was the character of this meeting? Does the Minister know whether the production of this vaccine is to cease? Would the decision in that regard rest with the Commonwealth or State governments concerned? Finally, has the Minister any technical advice concerning this vaccine and whether its continued use by those engaged in the domesticated rabbit-keeping industry carries any threat to the effective use of myxomatosis among the wild rabbit population?

Dr Donald Cameron:

– A meeting was held on 31st August to discuss this question.- It was attended by representatives of the Governments of New South Wales and Victoria, the Department of Primary Industry, the C.S.I.R.O. and the Department of Health. There was an exchange of views. The meeting did not make any recommendations to the various governments. The honorable gentleman has asked me whether the banning of the manufacture of this vaccine is a matter for the Commonwealth Government. I replied to a similar question, I think, last week. It is a matter for the State governments to determine. The fibroma virus is manufactured by one State at present. This vaccine is used for immunizing domestic rabbits against myxomatosis.

The honorable gentleman asked me about technical advice. The consensus of the technical and scientific advice that the Government has is that the danger of transmission of immunity to the wild rabbit population by the use of fibroma virus in farm rabbits is probably negligible, as it is not a disease which can be transmitted other than by direct inoculation. The protection against myxomatosis produced by fibroma is not transmitted as an hereditary factor and the dangers of its use are, therefore, negligible. The other advice the Government has, and it is an opinion which appears to me to merit close attention, is that it would be dangerous to use an attenuated strain of myxomatosis virus as the disease might well spread to the wild rabbit population.

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– 1 direct a question to the Minister for Immigration. Has the Minister received numerous requests, some of them through His Excellency the Governor-General and the Prime Minister, seeking reconsideration of his decision to deport two young Malays who have worked in the north of Australia for nine and twelve years respectively? Will the Minister inform the House whether, when making his decision to deport these two men, he considered the fact that they have lost all contact with their homeland, and that in one case the man has no friends or family to whom he can return? Considering that both men are British subjects and are excellent citizens, will the Minister withdraw the deportation order on humanitarian grounds and allow them to remain in Australia?

Minister for Immigration · ANGAS, SOUTH AUSTRALIA · LP

– It is quite true, as the honorable gentleman has said, that I have received requests from various quarters about these two Malayan pearlers to whom he has referred. One of them entered Australia in 1952 and the other one - my Malay is not very good although I have some long knowledge of that country - named Deraus Bin Saris came to Australia in May, 1949, I understand. So far as the last-named pearler is concerned, in spite of what my honorable friend has said, the papers held by the Department of Immigration show that, in fact, he returned to Singapore in January, 1954, for the express purpose of visiting his wife and children there. He re-entered Australia in May, 1954, presumably having seen his family.

Now, Mr. Speaker, these two men and many others in their category were allowed entry into Australia for the sole purpose of employment in the pearling industry. As I am sure the honorable gentleman himself knows, that is on a year-to-year basis. The position has arisen that since February, 1961, the services of these pearlers are no longer required. The men are relatively young, and all in all, I think it can be claimed that they have no special ties with Australia.

Sir, it is not as if they are being asked to leave for a foreign country. After all, Malaya is their land. I might add - and i think those honorable gentlemen who know the country will agree with me - thai Malaya is one of the delectable countries of Asia. It is a country with which we have close ties and for which all of us have a high regard.

For many years, Mr. Speaker, as the House knows, permission has been given to Asians to enter this country for specific purposes, but only for limited periods. If, when they complete their work here, demands are going to be made that people in this category should be allowed to remain here permanently, then an important issue of policy will arise. Honorable members should think very carefully before seeking a change in the present policy, under which a period of fifteen years residence constitutes one of the qualifications for being allowed to stay in Australia indefinitely.

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– 1 wish to ask the PostmasterGeneral whether, in the Budget allocation of funds for Postal Department works and services for the current financial year, sufficient funds have been set aside to allow the department to proceed with the long-delayed erection of the Neutral Bay post office, which is at present being housed in the premises of the Big Bear Super Market Proprietary Limited at Neutral Bay. In bringing this matter to the attention of the Minister, 1 want to emphasize that my constituents in this progressive area feel frustrated at my having been unable, over the years, to persuade the Postmaster-General to proceed with this much-delayed work.


– This is a matter on which the honorable member for Warringah has, over almost the last twelve months, made strong representations to me, and on which 1 have been in correspondence with him. My present recollection is that it has not been possible to include in this year’s Estimates provision for the work that he has recommended. I will check on that in order to make certain, but I think my recollection is correct. I assure him, however, that, as a result of his representations, the matter has been thoroughly considered. It will certainly be kept in mind so as to ensure that the position he has described will be relieved as soon as possible.

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– Will the Treasurer give to the House the reasons he gave on a television interview in Melbourne recently why he and his colleagues have decided, for all practical purposes, to make child endowment a dead letter?


– The honorable member raises a very interesting matter of policy, which could hardly be canvassed adequately here. I did set out recently, as briefly as I could, in reply to a question put to me publicly, the background to the introduction of child endowment by this Government in 1941.

Mr Ward:

– By a Labour government of New South Wales.


– The honorable member for East Sydney is hardly claiming credit for the adoption in the national arena of a very welcome policy in this field of social services to which a Labour government, which was in office for some years before this Government, omitted to give effect. As honorable gentlemen will recall, the Commonwealth Court of Conciliation and Arbitration at that time examined the circumstances of the economy and the situation of families which had to live on the basic wage, and it came to the conclusion that the wage, although adequate for a man and wife with one or, at the most, two children, was not adequate for a family in which there were more than two children. As it was unable to remedy the situation by an increase of the basic wage, which would have general application to all wageearners, it recommended that the Government consider introducing a scheme of family endowment. The Government acted in accordance with this recommendation.

I have always thought that it would have been better for the Australian community if subsequently, the trade union movement, instead of periodically seeking increases solely in the basic wage and on the basis of the highest wage that industry could afford to pay, had pressed for at least portion of any increase to go into an endowment fund, thus benefiting families with more than two children. But the trade union movement pursued the other course. Obviously, industry, being required to carry the highest wage that is within its capacity to pay, could not be expected to carry it in the other direction as well. There the matter stands.

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– My question to the Minister for Health relates to the importation from Ceylon of disease-carrying desiccated coco-nut. Have any suitable arrangements been made in relation to this matter with the Government of Ceylon?

Dr Donald Cameron:

– Yes. Following the discovery of some infected desiccated coco-nut, one of the senior officers of the Department of Health went to Ceylon and discussed the matter with the Ceylonese authorities. As a consequence, I understand that arrangements have been made by those authorities to exercise greater control over desiccated coco-nut coming to Australia.

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– I address my question to the Minister for Primary Industry. As the position relating to the tobacco industry has deteriorated, will the Minister endeavour to arrange a meeting between manufacturers and growers with a view to obtaining better understanding so that the industry will become stable and effective in the interests both of our economy and of the welfare of the people of Australia? I think the Minister knows that at present the growers are not aware of what the manufacturers will buy in the succeeding season. If arrangements can be made between the manufacturers and the growers I believe that the industry will become stabilized.

Minister for Primary Industry · FISHER, QUEENSLAND · CP

– A grower-appointed committee was set up only last Thursday with the blessing of the Commonwealth Government. The committee will receive some financial and technical assistance from the Commonwealth, and also the co-operation of the State departments concerned. The committee will commence operations this week. It will investigate the aspects that the honorable gentleman has mentioned and in the course of its investigations will have discussions with the manufacturers, as the honorable member has suggested, with a view to ascertaining their requirements for next seaton. I hope the investigations will be fruitful.

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– My question also is directed to the Minister for Primary Industry, ls it a fact that Australian lamb is now selling on the London market at considerably less than the fifteen-year meat agreement price, and that consequently a substantial deficiency payment will probably have to be made to Australia? Is this payment likely to be far greater than the present three farthings per lb. lamb bounty which has been authorized by the Government? If so, will the Government take steps to increase the bounty so that this year’s producers of lamb, not next year’s, will receive the benefit of the deficiency payment?


– The honorable member is correct. Actually the present selling price for lamb in the United Kingdom market is approximately 4d. per lb. below the minimum price guaranteed under the fifteen-year meat agreement. But the determination of deficiency payments is made on the difference between the average price received for lamb sold in the United Kingdom over the full year and the minimum price guaranteed under the agreement. The deficiency payment, therefore, cannot be calculated until the end of December. The average to date for the 1960-61 year is only slightly over Id. per lb. I would remind the honorable member that, as Minister, I cannot approve an increase unless the Australian Meat Board recommends an increase to me. I could not imagine that the board at this stage would recommend an increase, because the new export season has commenced and it would be difficult to make retrospective payments to those who have already delivered their lamb for this season. As the average deficiency to date is only slightly over Id. and as the board has no authority to recommend a deficiency payment in excess of the actual deficiency over the year, I do not think that the board would take the risk at this stage of recommending a payment.

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– My question is addressed to the Minister for Health. I ask him whether he knows and approves the British practice whereby a senior public servant cannot within two years of retirement accept a post with a company which deals with his former department unless he obtains the permission of his former Minister and the Treasury? More specifically, I ask him whether the recently retired DirectorGeneral of Health sought or received his approval to become a consultant to Lederle Laboratories, one of the largest firms whose drugs are approved by his department as pharmaceutical benefits?


– I do not know what regulations or customs are observed in Great Britain in this respect, but I do know from my knowledge of the ex-Director-General of Health that he would do nothing which was not entirely proper.

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– I ask the Treasurer: What effect would the provision by any government of housing loans at 3i per cent, interest have on the Australian economy? Further, is it not a fact that the 3 per cent, housing loans provided by the last New Zealand Labour Government were subject to a very restrictive low income means test, which debarred most people from securing such loans, although the limiting means test was not mentioned in the pre-election speeches of the New Zealand Labour Party?


– I cannot speak with any authority on the position in New Zealand, although I gather that the policy being followed there on low interest rate housing has produced some economic strain. But the Leader of the Opposition ventilated this matter, I gathered from the press, over the week-end, and I took occasion to comment on it in a couple of directions yesterday. Since then I have carried out a little research into the position which obtained when Labour was last in office, because the honorable gentleman, as I understood his case, was claiming that as Labour had been able to lend money at low interest on an earlier occasion it would do so again, if returned to office.

As matters stand immediately, the long-term bond rate is 5i per cent, and the rates are fixed, as the honorable gentleman will know, after consultation with the other members of the Australian Loan Council. If, after raising money at those rates, we were then to make housing finance available at 3i per cent, either there would have to be substantial additional taxation levied in order to make up the difference or there would need to be a massive injection of central bank credit for the purpose. Either course, I suggest, would have consequences which, in the case of the extra taxation, would not be welcomed by most people or, in the case of additional inflationary pressure, could be quite serious. The other factor which seems to me to be also of importance is that about one-quarter only - although that is a considerable proportion in itself - of domestic housing in Australia is provided from government funds, about £80,000,000 being carried on the Commonwealth Budget for this purpose. If private industry is to provide housing in competition with that provided by governments, then quite obviously, if an interest rate of 3£ per cent, were to apply, difficulties would increase, and there would be discouragement and dislocation in the field of private housing.

The honorable gentleman has not been consistent in his approach on this matter, as will be seen if we examine the position that obtained when Labour was last in office. At that time, the bond rate was 3i per cent., but the lending rate for the Credit Foncier housing loans by the Commonwealth Savings Bank was 3J per cent., a rate considerably in advance of the borrowing rate; and that at a time when the savings bank was paying 2 per cent, on money deposited with it. To-day, the rate paid by the savings bank is 3± per cent., yet the loans being made by the Credit Foncier section are made at 5i per cent. It will be seen, therefore, that the ratio is very much more favorable to-day - indeed, that it is actually below the long-term borrowing rate - whereas, in Labour’s time, it was above the long-term borrowing rate and virtually double the rate of interest being paid on savings bank accounts.

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– I ask the Treasurer whether it is a fact that, since this Government has been in power, the interest rate has been increased three times, corresponding to successive credit squeezes, and that, at the supposed end of each credit squeeze the rate has remained high. Also it is not a fact that the whole of the victory loans, liberty loans and security loans floated by the Curtin and Chifley Governments, and running into thousands of millions of pounds, were raised at rates in no instance higher than 3i per cent, whilst much of the money was raised at 3 per cent.? If some governments can do it - they were Labour governments - why cannot this Government do it?


– That question confirms the charge I made recently that the economic thinking of the honorable gentleman is superficial, to describe it kindly. He should be aware that not only in Australia, but indeed all around the world, in the years following the war there has been an upward movement in interest rates. The reasons for that are not difficult to find. In a time of war, particularly when controls of a most rigid kind are maintained upon the civil community, and people are deprived of the opportunity to build homes, to purchase motor cars or other consumer durables, or to invest in capital issues in the great variety of forms that investment can take, quite obviously, the savings of the people are available and can be secured at very low rates of interest.

But in a period of dynamic development and widespread prosperity such as this country has enjoyed under this Government, there is a great variety of ways in which the people can spend or invest their money. I believe that Australia can take some satisfaction in the fact that although we have made these enormous industrial advances and increased the amenities for our people - including the doubling of the number of motor cars on the road in the period since we took office - the long-term interest rate in this country is low by comparison with that of many other countries. In the United Kingdom, which could hardly be attacked as being a country of irresponsible finance, about 7 per cent, can be secured on government bonds at the moment. I suggest to the honorable gentleman that, instead of trying to make our task of raising funds for Commonwealth purposes more difficult by these fanciful proposals, he should study the position more realistically and support the Government’s efforts.

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– I wish to ask the Minister for Primary Industry a question which is supplementary to that asked by the honorable member for Farrer. In the event of a deficiency payment being required, will the Minister state how that payment will be made and who will receive it? Will the producer get any of these funds? If so, how?


– The deficiency payment of 2s. a carcass, approved on the recommendation of the Australian Meat Board, goes to exporters and should be reflected, as I think it would be, in the price paid for the lambs. The honorable member may not have been here when the relevant bill was being debated in this House. It was revealed then that you cannot pass payments directly back to the producers, but that the payments had been reflected in the price paid for cattle in the earlier case. I hope it will be reflected in the price paid for lambs.

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– Last week, the Treasurer, in answer to a question from the honorable member for La Trobe, stated that, last year, in at least five States, every £1 of the authorized borrowings for local government and semi-governmental authorities had been obtained by way of loans. I now ask the Treasurer whether Victoria was in his list of five States in which the local government bodies borrowed their full loan quota.


– My recollection is that it is, but I will check.

Mr Bird:

– You have been misled.


– I will make a check for the information of the honorable gentleman. The legislation which the Government has introduced should have the effect, in the long term, of bringing more money into local government loans than has hitherto been available.

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– Will the AttorneyGeneral advise the House of the progress that has been made by State governments in their move to pass the new uniform companies bill? Has the draft bill any special provision regarding take-overs to ensure additional protection to the existing shareholders of a company that is to be absorbed?


– The committee of Attorneys-General concluded its deliberations on a model companies bill about a month ago, subject to one or two minor things that are yet in discussion. On 1st September, the committee released prints of the model bill. Copies are on sale and are obtainable from my department in Canberra. The Deputy Crown Solicitors in the States, and the State Treasuries, will also have some for sale. The programme for the legislation is that the State Parliaments, in due course, will pass bills in the form of the model and that this House or the territorial legislatures will pass them in respect of Commonwealth Territories.

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– My question is directed to the Treasurer. Will the right honorable gentleman, when he returns from his forthcoming overseas trip, repeat his performance of last year and fly back by the French airline Compagnie des Transports Aeriens Intercontinentaux, known as T.A.I.? Does this airline fly in competition with Australia’s airline, Qantas Empire Airways Limited, and does it charge £68 more than is charged by Qantas for the trip from the United States of America to Australia? Does travelling by the French airline also involve the use of overseas currency when Australian currency could be used for a journey by Qantas? Does the Treasurer consider that his 36-hour stop-over last year in Tahiti, where the spear-fishing is excellent, justified his use of the more expensive airline and of valuable overseas currency?


– I appreciate the friendly interest of the honorable gentleman in my personal arrangements. I very much regret that I have never had an opportunity to spend 36 hours in Tahiti. Last year, I made arrangements to spend about twelve hours there. The prime purpose, but not the only one - because I have a natural curiosity in these matters - was that Qantas Empire Airways Limited, which is Australia’s overseas airline, has negotiated certain landing rights in the area. All this is probably unknown to the honorable gentleman, who has been concerned with more trivial matters for as long as he has sat in this House. As the Treasurer, who has to provide the funds for these purposes, and as a member of the Cabinet, which has to make decisions on the future travel plans of Qantas, 1 thought it was not without advantage to have some personal knowledge of these matters. If it will be of any comfort to the honorable gentleman, I tell him that on the three-and-a-half-week trip about which he talks, and on which I shall have an opportunity to sample travel on a variety of airlines, I shall fly back by Qantas direct from London with no stop-overs.

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– I direct a question to the Minister for Health. Is it a fact that eminent dental specialists assembled at the Australian Dental Congress have made declarations regarding the inadequacy of dental care for Australian children. Has it been established - and conceded by spokesmen for the dental profession - that economic circumstances often prevent families from obtaining adequate dental treatment? Will the Minister say whether he is prepared to extend the provisions of the National Health Act to provide for Australians dental protection similar to that enjoyed by the people of New Zealand, the United Kingdom and many other countries?

Dr Donald Cameron:

– The leaders of the dental profession in Australia and I have had numerous conferences on this matter. The leaders of the profession are well aware of the Government’s views and the Government is well aware of their views. I point out to the honorable gentleman that it is a complete error of thought to imagine that conditions in one country can be compared with those in another in the way envisaged by him, and that conclusions can be drawn on the basis of such comparisons.

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– My question is addressed to the Minister for Trade. I ask: Is he aware that many wool-growers in western Victoria and the south-east of South Australia keenly desire that their wool be sold at Portland in Victoria, where uptodate facilities for shipping are available in a decentralized modern harbour? Does he know that considerable savings in transport costs would result from such sales and the use of such shipping facilities? Will the

Minister confer with the appropriate members of the Cabinet to ascertain whether the Commonwealth Government can assist in encouraging permanent wool-selling at Portland? I may say that the honorable member for Wannon, and I, as member for Mallee, are keenly interested in this matter.

Minister for Trade · MURRAY, VICTORIA · CP

– I am aware that for many years there has been a body of opinion in western Victoria and in the southeastern corner of South Australia that Portland is a natural port for that area, and that there could be an advantage in an extension of trade and in a saving of costs to primary producers over a pretty big and productive area if that port were established and were used. The port now has been established, and I certainly hope that the maximum advantage will be taken of it, not only by the shipping of grain, but also by the setting up of a wool-selling centre at Portland. I do not believe that this development can be forced, but I do believe that if a woolselling centre were in due course established at a place that was economically suitable it would be recognized by the wool- buyers as a contribution to the wool industry in Australia.

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Motion (by Mr. Osborne) agreed to -

That leave be given to bring in a bill for an act to amend the Repatriation Act 1920-1960, and for other purposes.

Bill presented, and read a first time.

Second Reading

Minister for Repatriation · Evans · LP

– by leave - I move -

That the bill be now read a second time.

It is with considerable pride that I rise in this House to-day to propose a series of amendments to the Repatriation Act 1920- 1960, and thus become the nineteenth member of this Parliament who has been privileged, as Minister for Repatriation, to take part in the development of the Australian repatriation system. Through this system successive Australian governments have honoured the undertakings given to those who died or were injured through serving our country in war, and to their dependants.

These amendments will give effect to the proposals announced in the Budget for increases in the rates of war and service pensions and allowances, and to other extensions of benefits. At the same time I am taking the opportunity to make some necessary amendments to the machinery provisions of the act.

The repatriation system began with the War Pensions Act 1914 and the Repatriation Act 1917. These acts were consolidated in 1920 and have been amended many times since to introduce new benefits and to make innumerable administrative changes. The system is inevitably a complex one, and not all of it is contained within the act, as many of the benefits are provided through regulations made under authority of the act. Where the rates of pension and allowances are contained in the act itself this bill provides for the increases provided for in the Budget to take effect on the first pension pay day after the amending act has received the Royal Assent. Where the benefits flow from regulations under the act the regulations are being amended to make the increases effective from the same day.

The introduction of this bill gives me an opportunity to make some general remarks about our repatriation system. One of my first tasks on taking up this portfolio was to examine the system closely and to study the history of the legislation which I was to administer. Although it has grown up through two world wars a clear basic principle is discernible - that the main benefits of the act, namely, war pensions and medical treatment, arise only on death or disability due to war service. Only one exception has been made, and that was the decision in 1943 to accept for treatment and pension any ex-serviceman, suffering from tuberculosis, who had served in a theatre of war. It was not, in my view, an exception to this general principle to treat seriously disabled ex-servicemen, that is, (hose receiving the full 100 per cent, war pension, or the totally and permanently incapacitated, for all illnesses whether or not due to their war service, because such men are so seriously affected that it is not always practicable to treat their war-caused disabilities without having regard to all other disabilities responsible for their overall state of ill health. Similarly, the decision taken last year to treat the service pensioner for disabilities whether or not due to war service was taken on the same basis as that on which the service pension itself was established, namely, that there should be a measure of compensation for the intangible effects of service in a theatre of war for those who are in needy circumstances. As honorable members know, the service pension, unlike the war pension, is subject to a means test.

These were sound principles on which to build, and nearly 45 years of endeavour, inside and outside this Parliament, have produced a system which experienced people agree is not surpassed by that of any other country and is very much better than most. The work of my distinguished predecessor, Sir Walter Cooper, whose period of office coincided with the eleven years of this Government from December, 1949, to December, 1960, contributed very greatly to the structure.

In his policy speech before the general election of 1949 the Prime Minister (Mr. Menzies) undertook to ensure that there would be “ speed, financial and human justice and understanding in our administration of soldier problems “. We have kept that undertaking in the last eleven years, and this bill is evidence that we are continuing to do so. At its first Cabinet meeting in 1950 the Government appointed a committee of Ministers to examine all matters of war pensions and other benefits administered by the Repatriation Department, to confer with representatives- of exservicemen’s organizations and to recommend the necessary changes. As a result, the Budget of 1950 provided substantial increases in war pensions and benefits and introduced some new benefits. They have been reviewed in every Budget since.

I do not intend to give a long list of figures comparing the repatriation benefits of to-day with those of 1949; however, I ask the House to notice the increases in the main pension rates which have occurred under this Government. The special rate pension paid to totally and permanently incapacitated pensioners has risen from £5 6s. a week to £13 5s.; the full general rate pension from £2 15s. a week to £5 15s.; the combined war widow’s pension and domestic allowance from £3 7s. 6d. a week to £8 17s. 6d.; and the service pension from £2 2s. 6d. a week to £5 5s.

Many new benefits have been introduced during these years. Some that come to mind are the war widow’s remarriage gratuity introduced in 1950, gift cars for certain amputees and seriously paralysed members, the establishment in 1952 of a scheme to provide rehabilitation training for exservicemen from World War II. who were substantially handicapped, and for war widows of that war, to enable them to follow a suitable occupation. The cost of air travel was allowed to the next-of-kin of an exserviceman on the dangerously ill list to enable them to visit him in hospital. There have been other innovations - the payment of a war widow’s travelling expenses to and from hospital, a clothing allowance to amputees and certain other pensioners. These are all examples.

Certainly the most notable achievement of recent years was the introduction in 1960 of free medical, dental and optical treatment for service pensioners, whether or not their disabilities are due to war service. This extension is of the greatest importance to service pensioners, particularly since it has given them the right to treatment in repatriation general hospitals. Since then, as the House knows, the introduction of the merged means test has considerably increased the numbers eligible for the service pension.

The increases in benefits provided by this year’s Budget cover a wide range. Additional payments will be made to all wardisabled ex-servicemen, to war widows and their dependent children, and to service pensioners. The special rate payable to those whose war-caused incapacities are so severe as to prevent them always from earning more than a negligible percentage of a living wage, and to the war-blinded, is increased by an amendment to the second schedule of the Act by 10s. a week and becomes £13 5s. a week. This rate will also be paid to ex-servicemen who are temporarily totally incapacitated and to certain sufferers from tuberculosis. There is an intermediate rate of pension which the Repatriation Commission may grant under the second schedule to those sufferers from tuberculosis who are not totally incapacitated, but who, on the way to recovery, are only able to do relatively light work. This rate is known as the class “ B “ rate for tuberculosis. It will also be increased by 10s. a week and will become £9 7s. 6d, a week.

The general rate war pension - that is, the 100 per cent, rate - for incapacitated ex-servicemen will rise by 5s. a week to £5 15s. a week with proportionate increases for those with a lesser degree of disablement.

Altogether over 212,000 disabled exservicemen will benefit from the three increases to which I have referred. A further 42,700 dependants of ex-servicemen whose deaths have been accepted as due to war service will benefit from the increases in war pensions payable to war widows and their children, and to the dependent children of a deceased war widow. The latter are generally referred to in my department as “ double orphans “. Over 35,000 war widows will receive an increase of 5s. a week in their war pensions which now becomes £5 15s. a week. About 90 per cent, of war widows are also entitled to the domestic allowance, which will be increased by 2s. 6d. a week to £3 2s. 6d. The domestic allowance is paid under the regulations to a war widow who has one or more children under the age of sixteen years or still being educated or who is herself over the age of fifty years or permanently unemployable.

Children under the age of sixteen years of ex-servicemen whose deaths were due to war service will receive the following considerable increases: - To the first child, 7s. 6d. a week, making the new rate £1 19s. a week; to each other child, an increase of 5s. a week to £1 7s. 6d. a week: to double orphans, an increase of 8s. 6d. a week to £3 lis. 6d. I remind honorable members that these children, from the age of twelve years upwards, also receive an education allowance to assist them with their education, beginning at 16s. 6d. and rising to £1 5s. a week at fourteen years of age, and that there are considerably greater allowances to a child who continues his education or training after the age of sixteen years. In addition to pensions, war widows and the children of deceased exservicemen are also entitled to a full range of medical and dental treatment.

These increases in the general rate and in dependants’ pensions are covered by the amendments to the first and third schedules of the act.

Certain double amputees, some of whom have also suffered a partial loss of sight, also receive an increase of 5s. a week in the special amount payable to them. They are the ones who suffer from the disabilities described in the first six items in the Fifth Schedule. They will receive £7 10s. a week in future which, together with the full general rate pension to which these disabilities also entitle them, will amount to a total pension payment of 13 5s. a week, the same amount as the special rate. Some of these cases will also receive an additional £5 5s. or £3 5s. a week as an allowance for an attendant. Broadly stated, the cases entitled to an allowance for an attendant include some double amputees, the war blinded and those suffering severely from spinal injury. All of them have special need for assistance. Those allowances are paid at two rates according to the severity of the disablement. The present rates are to be increased by 15s. a week to £5 5s. and by 10s. a week to £3 5s. a week respectively, by amendment of the Second and Fifth Schedules of the act.

I will now mention briefly the increased benefits which do not appear in this bill because they are provided by regulations. The maximum rates of medical sustenance following the increases in the special and general rate pensions will automatically be increased by 10s. io £13 5s. a week and by 5s. a week to £5 15s. respectively. These are paid at the higher rate during periods of treatment in hospital and at the lower rate where a short period of out-patient treatment prevents the ex-serviceman from working. The lower rate is also paid during periods of medical investigation in connexion with a war pension. If the exserviceman has as a dependant wife or child additional amounts are paid.

Perhaps the most important of these budget changes is that which is being made in the conditions for payment of medical sustenance during essential convalescence after discharge from hospital. Hitherto sustenance at the special rate, now to be £13 5s. per week, has been paid only while the ex-serviceman was an in-patient in hospital. Now it will be continued at the higher rate during a period of convalescence following immediately upon hospital treatment where a departmental medical officer certifies that the convalescence is necessary.

I turn now to service pensioners. As honorable members know, the service pensioner is the ex-serviceman or woman who served in a theatre of war, who has reached the age of 60, or 55 in the case of women, or is unemployable, and who can meet the same means test as for the social services age pension. Ex-servicemen suffering from tuberculosis also receive a service pension. The increases in the maximum rate for a service pensioner will be 5s., making the new rate £5 5s. a week. No amendment to the act is needed to do this as section 85 automatically applies to service pensioners the social service increase. That section is. however, to be amended to increase by 12s. 6d. per week the service pension of a wife and by 3s. 6d. a week the pension payable to the first child of a service pensioner whose pension is granted on medical grounds; that is, one who is permanently unemployable or who suffers from tuberculosis.

Under the existing law, an allowance has been paid to employees towards their loss of salary or wages when they are required to attend for examination or treatment. For some years ex-service organizations have asked that this allowance should be extended to self-employed people. The small businessman may have to close his business when he cannot personally attend to it, or the professional man may lose through absence from his work. To pay this allowance to self-employed people does present some administrative problems, but they can be overcome, and I am glad to announce that the Government has decided to pay this allowance by way of compensation to self-employed people at the same rate as to salary and wage-earners. This will be done, by amendment of the regulations.

The other amendments which this bill proposes are concerned with the machinery provisions of the act and I will deal with them briefly to avoid taking up the time of the House. Any further information which honorable members may need will be readily given during the debate in committee.

The provisions relating to leave of absence of members of the commission, the Entitlement and Assessment Appeal Tribunals, and the Repatriation Boards are being amended to save repeated reference of purely administrative matters to the Governor-General. At present it is necessary to obtain His Excellency’s approval for any of the holders of these statutory offices to be absent for more than fourteen days. The amendment will make special approval unnecessary unless the holder of the office is absent for more than 21 days consecutively in any year. This will cover the normal period of annual leave and short periods of sick leave. Except in the case of the three, repatriation commissioners themselves, the amendment will provide for absence in future to be approved by the responsible Minister instead of being referred to the Governor-General as at present.

Under section 24a of the act, when an applicant for a war pension dies before his claim has been determined by a board or before he has lodged an appeal to the commission against an unfavorable decision of a board, an appeal can be made to the Repatriation Commission for the benefit of his dependants or his estate. There is no provision, however, for any further appeal to an Appeal Tribunal in these cases, and I feel that this can deny to the dependants of a dead man a right of appeal which he could have exercised, perhaps for their benefit, if he had lived.

As honorable members know, the grant of a war pension automatically gives a right to the appropriate pensions to the wife and dependent children of the ex-serviceman, and they continue to receive these pensions after his death. The widow of a special (T.P.I.) rate pensioner, regardless of the cause of his death, is entitled to the benefits of a war widow, and there are other similar cases. A decision on a posthumous claim can therefore affect not only the exserviceman’s estate, but more importantly the right of his dependants to repatriation benefits after his death. It is proper that they should be able to pursue their rights to the full extent of appeal to the tribunals. This bill, therefore, proposes an amendment which will allow an appeal in cases of this sort to an Entitlement or Assessment Appeal Tribunal against an adverse decision of the commission.

As I have just pointed out, the dependants of an incapacitated ex-serviceman who dies from causes which were not due to his war service continue to receive the pensions to which they were entitled immediately prior to his death. This provision has been in the Repatriation Act from the beginning and it has always been thought that it entitled the dependants to an appropriate increase whenever the pension rates have been increased from time to time. Doubts about this assumption have arisen lately on legal grounds, and so to make it clear that the established practice will be continued, section 45 of the act is being amended.

The final amendment is also intended to resolve a legal doubt about an existing practice. The Government decided last year to provide medical treatment for Boer War veterans who are service pensioners. The validity of a new regulation to give effect to this decision has been questioned, so section 124 of the act is being amended to put it beyond doubt.

This year brings the Commonwealth Reconstruction Training Scheme almost to its conclusion. This scheme was established towards the end of 1943 with the double purpose of re-establishing exservicemen in civil life and helping to overcome deficiencies in trained personnel which had developed during the war. It was originally administered by the Department of Post-War Reconstruction but was passed to the Repatriation Department in 1950. How wisely it was conceived and how effective it became can be judged from its results. It helped about 88,000 exservicemen and women to re-establish themselves in civil life. Of these 15,000 received university training, 40,000 technical school training and a further 1,600 rural training. In addition, the skilled work force of the community was strengthened by 31,000 men trained in different trades, particularly in the building industry.

Much of what was accomplished was due to the help given by people representing organizations of employers and employees, and from the universities and technical schools, who worked untiringly and without payment. With representatives of different Government departments from Commonwealth and States, they played their part on the Central, Regional and Industrial Committee to which the direction of the scheme was entrusted. It seems appropriate for this House to acknowledge their achievement with thanks, as the scheme comes to its conclusion.

At this distance of time, 43 years from the end of World War I., and sixteen years from World War JJ., our repatriation system has inevitably become a complicated and established governmental mechanism. So much has been achieved in the past that the field for new extensions in the future has necessarily become restricted. In the period ahead the main efforts of my department will be directed to making full use of the remarkable advances in the medical sciences and so to maintain and increase the high standards of treatment for those entitled to it.

From the nature of our responsibilities and the passage of time, we have to deal mainly with an ageing group in the community, so special attention will be given to the care and treatment of elderly people. Wilh this in mind, a new type of hospital is being developed within the department. Another field of special effort will be the treatment of the mentally ill. It is necessary in their own and the nation’s interest to do everything possible to restore them to normal life in their homes and to their work in the community. I hope to have more information for the House from time to time on the progress of our work in these two fields.

High among the things that move us should be a determination to keep the system human. It is my responsibility to ensure that it continues to be administered with sympa.hy, with generosity and with understanding, and I assure! the House qf my strong purpose to do so..

Debate (on motion by Mr. Barnard) adjourned.

page 801


Motion (by Mr. Roberton) agreed to -

That leave be given to bring in a bi.ll for an act to amend the Social Services Act 1947-1960.

Bill presented, and read a first time.

Second Reading

Minister for Social Services · Riverina · CP

– by leave - I move -

That the bill be now read a second time.

This is the twelfth successive year in which a Minister of the Liberal-Australian Country Party Government has introduced social service legislation to give effect to the changes announced by the Treasurer in the course of his Budget speech. No other government of the Commonwealth of Australia has ever been given the opportunity to govern for so long and effect so many changes in the social welfare programme of the Australian people.

It is the sixth successive year in which the responsibility has been mine to introduce this legislation and to explain its purposes. No other Minister for Social Services has ever had the opportunity to apply himself to the task on a greater number of occasions, and I can assure the House thai this bill follows the pattern of all the preceding legislation designed to improve the circumstances of a vast number of the Australian people. I refer to our age and invalid pensioners and to their wives and children, to our widow pensioners and to their children, to those who are receiving unemployment, sickness or special benefits and to their wives and children - a total of more than 1,000,000 people, men, women and children, who are directly affected in a personal way.

My colleague, the Treasurer (Mr. Harold Holt) has already informed honorable members of the Government’s social services proposals which are embodied in this bill. Briefly they are to increase the maximum general rate, of age, invalid and widows’ pensions, to increase the allowances received by the wives of invalid pensioners, the allowances paid for the first children of invalid pensioners, the additional pensions for children payable to widows, the rates of unemployment and sickness benefits payable to adult persons and married minors, together with the additional benefits paid on account of their wives and children. The increases will, of course, also be payable to those qualified persons who come within the scope of the Commonwealth Rehabilitation Service.

In no twelve years in the history of our Commonwealth has this Parliament ever had before it such a succession of social service bills conferring such manifold benefits upon so many people. In no twelve years in our history has any other government, or any other succession of governments, ever been able to induce such a degree of stability and encourage such a measure of prosperity that it could confidently expect this Parliament, representing the Australian people, to endorse, year by year, measures for social progress that were expressly described as utterly impossible only thirteen years ago.

In these twelve years, from 1949 to 1961, during which the Australian people have been asked to meet vast and ever-increasing expenditures on social welfare, the Government has reflected the true spirit of a socially conscious and a courageous people. It is the innate spirit of Australian individualism - and may it never be stifled- - which demands freedom for the energy, initiative and enterprise of every person, and concedes that those who reap the harvest of their industry and providence shall contribute to improve the circumstances of those who, for any reason, are unable to made adequate provision to meet the normal hazards of life and living.

That is the spirit which pervades the social service policy of the Government, and for its practical interpretation we depend on the resourcefulness of an industrious community to tap the great wealth of our most-favoured country and share it with those who are in need of assistance from time to time, the old, the young, the weak, the fatherless, the sick and the unemployed. The bill provides a measure, in terms of money, of the social service progress which has been made during the last twelve years, when the total expenditure from the National Welfare Fund increased by £277,453,000, or from £80,777,000 in the last full financial year of the previous Labour Government, 1949, to £358,230,000 in the current financial year.

This bill increases the maximum general rate for age and invalid pensioners from £5 to £5 5s. a week - as compared with £2 2s. 6d. a week twelve years ago. For a married couple, both pensioners, the new rate will be £10 10s. a week - as compared with £4 5s. a week in 1949. Where a couple without children have property, the value of which does not exceed £419, entitlement to receive some pension will remain until their income reaches £17 10s. a week. Where they have no income, other than income from property or child endowment, both of which are exempt, entitle ment to some pension will remain until the value of their property reaches £9,500. And may I say that it is but rarely that these limits, beyond which no pension is payable, are ever quoted or clearly understood. These limits do not include the value of the home, the furniture, personal effects including a motor vehicle not used for commercial purposes, and certain other exempt items.

Age and invalid pensioners who are qualified to receive supplementary assistance will, of course, continue to receive payment of 10s. a week in addition to the new rate of pension. This additional 10s. a week is paid, over and above the maximum general rate pension, to single pensioners, and to married pensioners where only one of the couple is in receipt of a pension or an allowance, who pay rent for their accommodation, and who are deemed to be entirely dependent on their pensions. This bill will increase the total receipts by way of pension and supplementary assistance of such pensioners from £5 10s. to £5 15s. a week.

The maximum rate of the allowance paid to the wife of an invalid pensioner, or a permanently incapacitated age pensioner, will be increased by 12s. 6d. a week to bring it from £1 15s. a week to £2 7s. 6d. a week. This is the largest increase which has been made in the rate of a wife’s allowance since it was first introduced in 1943. In addition, the allowance which the wife of an invalid pensioner, or a permanently incapacitated age pensioner, receives for the first child under sixteen years will be increased from lis. 6d. to 15s. a week.

The combined effect of the general increase in age and invalid pensions and the increases in the allowances paid to wives and children, to which I have just referred, will be that an invalid pensioner and his wife together will receive a total increase of 17s. 6d. a week if they have no children, and 21s. a week if they have one child or more than one child. Where they have more than one child, they will continue to receive the additional pension of 10s. a week for each child after the first.

On present rates, the total amount a pensioner, his wife and three children may receive by way of pension, additional pension for children, wife’s allowance, child’s allowance and child endowment - to quote an example - is £9 lis. 6d. Under this bill that amount will be increased to £10 12s. 6d. a week.

Since 10s. a week of a pensioner’s income is disregarded for each child under sixteen years of age, an invalid pensioner with a wife and three children whose property does not exceed £419. may receive £22 5s. a week, inclusive of child endowment, before his entitlement to receive some pension is exhausted. Here again the maximum is invariably obscured by the emphasis which is always given to the minimum.

This bill provides for the new maximum general rate of pension payable to a class A widow - that is, a widow with a dependent family - to be increased from 5s. to £5 1 0s. a week, but that rate applies to a widow with only one child.

It is to the everlasting credit of this Government that it was the first Government to give practical recognition to the principle of providing assistance, by way of an additional payment, to class A widows and invalid pensioners who have the custody, care and control of more than one child, and of increasing the amount of that assistance in direct proportion to the number of children in their custody, care and control. In fact, I am happy to say that it was my privilege in 1956, during the first year of my term of office as Minister for Social Services, to bring down amending legislation to provide an additional pension of 10s. a week to class A widows and invalid pensioners for each child after the first. It is even more gratifying for me to have the opportunity to introduce further measures designed to improve the position of the class A widow, and the invalid pensioner who has a wife and family to support. That is achieved in this bill by raising the amount of the additional pension received by the class A widow in respect of children other than the first child, and by substantially increasing, as I have already indicated, both the wife’s allowance and the child’s allowance payable to the wife of an invalid pensioner or a permanently incapacitated age pensioner.

The bill provides that a class A widow with two or more children, in addition to receiving an increase of 5s. a week in the maximum general rate of her pension, will also receive an increase of 5s. a week for each child after the first. The additional pension for each child after the first will thus be raised from 10s. to 15s. a week. Hence, the total pension increases for a widow with two children will be 10s. a week, for a widow with three children 15s. a week, and so on, the total increase becoming greater by 5s. a week for each subsequent child.

May I remind honorable members that the total weekly amount which may be received at the current rates by a class A widow in terms of pension, additional pension for children and child endowment is, if she has two children, £6 1 0s.; if she has three children, £7 10s.; if she has four children, £8 10s., and so on. It will be seen that the amount increases by £1 for each additional child. But under this amending legislation a widow with two children will receive £7 a week, increasing by £1 5s. for each additional child.

A widow with four children the value of whose property does not exceed £2,250 may, in addition to income from that property - which is exempt - have other income up to £15 a week inclusive of endowment before her entitlement to some pension is extinguished. Thus, given a reasonable return on the investment of £2,250, this means an income approximating £17 a week. In addition she can, of course, own her own home, furniture, personal effects and other property that is normally disregarded. That is an increase of £11 7s. 6d. over the total a class A widow in similar circumstances could receive in terms of pension, income and child endowment in 1949.

The maximum rate payable to a class B widow - that is, a widow of 50 years of age who has no children under sixteen years of age - will be increased from £4 7s. 6d. to £4 12s. 6d. a week. The same increase will apply to the class C widow - that is, a widow who does not possess the basic qualifications for the class A or class B pension but who is in necessitous circumstances immediately following the death of her husband. All widow pensioners who are qualified to receive supplementary assistance will, as in the case of age and invalid pensioners in similar circumstances, continue to receive that payment of 10s. a week in addition to the increased rate of pension.

Honorable members will recall that last year the Government abolished the class D widow’s pension. Formerly, a class D widow - that is, a woman whose husband has been imprisoned for at least six months - was entitled to receive a pension at the same rate as a class B widow with no additional payment for any children after the first child. To-day they receive either a class A or class B widow’s pension, whichever is appropriate to their circumstances. Under this amending legislation they will receive the increased rate common to both categories and, in addition, those who receive payment at the class A rate will benefit from the special consideration given to widows with dependent children this year.

Before passing from the proposed increases in pension rates, perhaps I should mention that where a pensioner is an inmate of a benevolent home this bill provides that, of the 5s. increase, 2s. will be paid to the pensioner. At present a pensioner inmate receives 35s. a week of his pension and the balance is paid to the authorities conducting the benevolent home. When the legislation is amended, the pensioner will receive 37s. a week with £3 8s. paid to the home for his maintenance. The proportion, to the nearest shilling, is consistent with the formula which has always been used te meet these circumstances.

Consequent upon the total increase of 20s. a fortnight for a married couple, both pensioners, it has been necessary to increase the figure in section 28 (3) (b) of the act from £34 to £35. This is the new amount a married pensioner couple may receive in that period by way of pension and other income. The effect will be to prevent any reduction in the age or invalid pension payable to a blinded soldier following the proposed increase of 10s. a week in the special rate war pension.

The bill before the House provides for a further increase in the rates of unemployment and sickness benefits; the third which has been granted by the present Government. Since special benefits, payable to migrants and other people in similar circumstances, are normally paid at unemployment and sickness benefit rates, these benefits will be increased accordingly.

The rate for an adult or a married minor will be increased by 10s. a week, or from £3 5s. to £3 15s. a week. Additional benefit for a dependent spouse will be raised to £2 12s. 6d. a week, an increase of 5s. a week, and additional benefit for a dependent child will be. raised to 12s. 6d. a week, an increase of 2s. 6d. a week. The total increase for a man, wife and child is thus 17s. 6d. a week, increasing the total rate of benefit payable from £6 2s. 6d. to £7 a week. In addition, a beneficiary may receive £2 a week income without affecting the rate of benefit and, in the case of a sickness beneficiary, any additional amount from an approved friendly society. Arising out of these increases, the bill contains some consequential amendments.

When the Government was elected to office in 1949, unemployment and sickness benefits were payable to an adult or a married minor at the. rate of 25s. a week. With the additional 10s. a week provided for in this bill, the rate will have been increased threefold. The rate payable for a man, his wife and child will have been increased during the same period from 50s. a week to £7 a week. The amount of income which may now be received without affecting the rate of benefit was doubled by the Government in 1957. The increased rates of pensions, allowances and benefits will be paid on the appropriate pay-days following the date of commencement of the amending act.

Mr. Deputy Speaker, I have given to honorable members an outline of the provisions of the bill but, as yet, I have made no reference to the immediate, and detailed cost. Sufficient it is for me to say that the effect of the increases in pensions and allowances alone, which can be fairly accurately assessed, is to add some £8,000,000, to the cost for 1961-62, or £10,500,000 for a full year and, together with other items of expenditure including increases in unemployment and sickness benefits and £2,000,000 which has been provided for expenditure under the Aged Persons Homes Act, the total expenditure from the National Welfare Fund must move up by some £27,626,000 and approximate the estimate, which I have already given, of £358,230,000 for 1961-62. This has been a memorable year in the history of the social services of our country. After more than 50 years of an arbitrary means test to the prejudice of people who had property in excess of £200 but no income, a merged means test was devised and introduced in March of this year which benefited more than 100,000 existing pensioners and brought within the general scope of social services an additional 6,000 men and women who had previously been excluded. To attempt a structural change of that magnitude without disturbing the intricate mechanism of a department which makes payments to or for some 4,500,000 men, women and children at regular intervals was a task that might have daunted a less dedicated organization. It is with unfeigned pride that I draw the attention of all honorable members to the fact that the changeover from the two traditional means tests to the new merged means test was effected by the officers of the department in a way which has excited the admiration of those who are in a position to appreciate the formidable nature of achievement. Admittedly problems arose, but they were solved; difficulties were encountered, but they were overcome; dangers were revealed, but they were reduced to safety and the even tempo of the Department of Social Services was never allowed to falter throughout a most difficult period. I think honorable members would want me to acknowledge the devotion to duty that made it possible.

Other structural changes are under consideration. They involve differential rates of pensions and allowances to meet the needs of modern society, and some consideration must be given to the increasing interest of the general public - and the increasing confusion - over the relative merits of a contributory scheme of social security on a national basis. During the twelve years, and at the direction of the Government, the Department of Social Services has undertaken a careful study of the operations of a variety of contributory schemes in other parts of the world but, without drawing invidious comparisons, the results have been far from reassuring. There is no known way to stabilize the value of money; there is no known way to confine the demand for expanding health and social service benefits within certain fixed limits; there is no known way to strike a permanent rate qf contribution within the competence of every person to pay without regard to income, or the lack of income, and there is no known way to free the Treasury - that is, the taxpayers of a country - from the responsibility of meeting the very substantial deficits which are inseparable from every publicly-controlled social security scheme.

The inflationary pressures of modem society, no matter how they are restricted, sooner or later reduce the value of money; the demand for increased benefits and extended services appears to be insatiable; the rate of contribution can never be permanent or adequate to meet the increasing commitment, and subventions from government sources approximate the proportions of a non-contributory scheme. The end result is invariably a strata of social services. One at the private superannuation scheme level which, in various forms, is exclusive but rarely adequate; one at the public superannuation scheme level which has the same fault; one at the basic pension level with both pensions and contributions constantly under revision; one at the special assistance level which usually includes provision for rent, and one based on the poor law traditions of the old world or on public charity for the relief of extreme poverty. The health services follow the same general pattern.

In our own country a contributory scheme of health and social services is favoured by those who fail to see that a contribution is, in fact, a prior tax of increasing dimensions which must be paid regardless of any exemption from income taxation, who fail to see that neither the contributions nor the benefits could ever remain constant, and who believe that schemes of the kind are self-supporting. Prudence demands recognition of the fact that they never are.

Roughly speaking, half the people of the Commonwealth of pensionable age are excluded, by their more favorable circumstances, from social service pensions. Any contributory scheme of social security appropriate to our country would require a contribution that would yield double the current cost of pensions and make provision for the aging character of the Australian population. Such a scheme presupposes that the state of perfection has already been reached, that the cost would never vary and that the value of money would remain for ever constant.

In their present form, Commonwealth health and social services are based on the willingness and the ability of the Australian people as a whole to provide assistance for those who are in need of assistance and who are qualified in terms of residence, circumstances, age, invalidity, bereavement, maternity, the custody and care of children, sickness or unemployment. Tt is the unenviable duty of the Executive Government to determine the measure and the nature of that assistance and confine the cost within the limits of the Budget in each and every financial year. To the best of my knowledge and belief no government, regardless of its political character, has ever shirked that duty, in spite of all the conflict and disputations which are inseparable from it.

Through my department, and ignoring, for the moment, all the other agencies engaged in social welfare work - the State Governments, the local government authorities, the Churches and the voluntary organizations of every kind - the Government makes social service payments to or for some 4,500,000 people - men, women and children - and the aggregate of these payments approximates £800,000 a day!

The prodigious proportions of that daily commitment, which has to be borne by a work force limited to half our effective population and which has never been contested, reflects the earnest desire of the Australian people to lift the fell hand of desperation from those who are in distress.

This is the sixth bill of its kind that I have had the honour to present to the Parliament. It is a major factor in adding some £28,000,000 to the cost of social services, but it adds much more than that to our stature as a nation. It provides an opportunity to re-affirm our faith in ourselves, in our country and in the democratic systems and institutions that, with all their faults, have brought us thus far along the road of social progress - farther, and in a shorter space of time, than the systems and institutions of any other country have brought any other people since the dawn of human history.

Mr. Deputy Speaker, I commend the bill to the House.

Debate (on motion by Mr. Allan Fraser) adjourned.

page 806


Motion (by Mr. Opperman) agreed to -

That leave be given to bring in a bill for an act to amend the Seamen’s War Pensions and Allowances Act 1940-1960, and for other purposes.

Bill presented, and read a first time.

Second Reading

Minister for Shipping and Transport · Corio · LP

– by leave -I move -

That the bill be now read a second time.

This bill represents the twelfth amendment of the Seamen’s War Pensions and Allowances Act since it was first passed in the war-time days of 1940. Since 1952, the act has been amended each year, except 1956, to give Australian mariners who have been incapacitated by war injury, and their dependants, increases in pensions and benefits of various kinds.

The Repatriation Act is in process of being amended to implement the Government’s decision further to increase pensions and benefits under that act, and it is the practice to maintain pensions and benefits payable under the Seamen’s War Pensions and Allowances Act at the same levels as those payable under the Repatriation Act.

Section 22a of the Seamen’s War Pensions and Allowances Act automatically applies to the Australian mariners concerned the special totally and permanently incapacitated rate of pension payable under the Repatriation Act. The increase of 10s. in the weekly rate provided for in the current Repatriation Bill will therefore automatically apply under the Seamen’s War Pensions and Allowances Act.

Other increases provided by this bill, in line with increases in the Repatriation Bill, include -

  1. a rise in the fortnightly rate of pension payable to children of a deceased Australian mariner from £3 3s. to £3 18s. in respect of the eldest child and from £2 5s. to £2 1 5s. in respect of each other child;
  2. a rise in the fortnightly rate of pension payable in respect of each child of a deceased Australian mariner, where the mother of the children is deceased, from £6 6s. to £7 3s.;
  3. a rise of 10s. per fortnight in the general pension rates payable to an Australian mariner upon total incapacity and to a widow on the death of an Australian mariner, thus increasing the maximum from £12 16s. to £13 6s.; and
  4. a rise from £5 10s. to £6 10s. per fortnight in the rate of allowance payable for an attendant in cases where specified types of disability exist, and from £9 to £10 10s. in cases where two arms have been lost.

Clauses 2 and 7 of the bill ensure that the increases can be paid on the first pension pay day after it receives the royal assent.

The opportunity has been taken to deal with other matters in this bill. Clause 4 provides for the insertion in section 59 of the act of the power to enable the making of regulations to authorize the payment of a clothing allowance to persons suffering special disabilities, such as amputees, on the same lines as a clothing allowance recently made payable under the repatriation regulations. It also provides for the widening of certain regulation-making powers in section 59 to enable the regulations to be amended to provide for the payment of sustenance allowance during convalescence and for payment of allowance for loss of earnings to self-employed persons, as is to be authorized under the Repatriation Act and regulations. A small amendment in wording to provide a more satisfactory authority for the existing regulations has also been included.

The other matter dealt with by the bill, in clause 8, is the validation of certain allowances and other benefits which were paid, in line with similar payments under the Repatriation Act, during a period prior to the recent promulgation of the new Seamen’s War Pensions and Allowances Regulations, which now provide the authorityfor these payments.

This bill is very obviously for the benefif of those Australian mariners who suffered in the service of this country during thelast war, and their dependants, and therefore, I am sure, will have the wholehearted support of all honorable members.

Debate (on motion by Mr. Barnard) adjourned.

page 807


BUDGET 1961-62

In Committee of Supply: Consideration resumed from 31st August (vide page 781), on motion by Mr. Harold Holt -

That the first item in the Estimates, under Division No. 101 - The Senate - namely, “ Salaries and allowances £34,250”, be agreed to.

Upon which Mr. Calwell had moved by way of amendment -

That the first item be reduced by £1.

St. George

.- During the last couple of weeks when this debate on the Budget has been in progress I have noticed that the galleries have been well filled on most occasions. 1 believe that a very large number of people have also been listening to the debate on the radio. I have no doubt that a great deal of confusion has arisen in the minds of many people as they listened to the debate and heard first, one speaker extolling the virtues of the Budget as if it were the work of a near-genius, only to be followed by another, describing the Budget in such terms that one must surely believe it to be the work of a near-idiot. I incline to the latter view, myself. Sometimes I think too, as the debate progresses, that my favourite poet, Omar Khayyam, must have projected himself into the twentieth century when he wrote those immortal lines -

Myself when young did eagerly frequent

Doctor and Saint, and heard great argument

About it and about; but ever more

Came out by the same door wherein I went.

The pensioner can look at the Budget and truthfully say: “ Well, it gives me 5s. I am now back to where I was twelve months ago - no better off and no worse off than I was then.” If he is as patient as pensioners usually are he will probably add, “ Thank God I am not much worse off”. There is no doubt about the pensioners - they have to learn to be grateful for small mercies.

Some businessmen will say that the Budget preserves the status quo. They will say: “ I amsatisfied with what I have, I am doing reasonably well. I do not want to expand, anyhow, because expansion would only cause me bigger business headaches, and this Budget restrains my competitors who might injure my business. Therefore, this Budget suits me.” Other businessmen will be disappointed. They have just passed through a very lean year. They wanted to expand their activities. In their eagerness to expand they planned a programme which did not take into account a sudden cessation of credit, which is like life-blood to the community and to them. They have suffered a great deal of unnecessary worry and anxiety and some of them have even endured insolvency.

In the ranks of the employed there are two broad divisions - those who have job security and those who have not. Those who have job security have their own special personal problems in life and they spend little time worrying about how the other half lives. The other half, who live without job security, are doing some thinking deep down inside. For some of them, it is the first time ever because, as the Treasurer (Mr. Harold Holt) himself remarked during the Budget debate last year, they had never had it so good until recently.

Australia was floating along on a wave of borrowed money. Seasons had been good. Prices for wool had been high. The fringe institutions were flourishing on high interest rates. It was 1929 all over again. The share market was buoyant. Jobs were easy to get. Profits were easy to make. Take-overs were the order of the day. It became difficult to remember who had bought out whom and which company now owned which. There was heavy foreign investment. The Federal Government was falling over itself in its mad anxiety to sell the right to exploit our mineral wealth to American interests, using the flimsy excuse that we could not do so ourselves. There were a few clouds on the horizon but they were a long way off. Then, suddenly, without any warning, as if he had been bitten by a mad dog, the Treasurer acted, throwing us into a crazy skid with a credit squeeze. The motor trade will remember the phrase “ credit squeeze “ because to the motor trade it has had a particular and peculiar application.

The Leader of the Opposition (Mr. Calwell) has said without any equivocation whatever that if we are. returned at the next general elections he will see to it that another budget is presented by February, 1962, when the next Parliament will meet. He will budget for a deficit of £100,000,000. The Treasurer has thrown his hands high in the air in horror at this, to him, astonishing proposal. Yet it was all right for his predecessor, Sir Arthur Fadden, in 1958, to budget for a deficit of £110,000,000. By all signs and portents of this year and the coming year, if Sir Arthur Fadden were still with us as Treasurer, he would have been ready to budget for a deficit of £200,000,000. Whatever faults Sir Arthur Fadden may have had, at least he had faith in Australians and Australia. This Treasurer always claims to be in search of stability. If stagnation represents stability in the thinking of this Treasurer, that is precisely what he is going to get.

Reverting to the matter of budgeting for a deficit of £110,000,000, as Sir Arthur Fadden did, I can recall a discussion which I had with a Sydney businessman at the time. This gentleman, incidentally, has his philosophy degree in economics. He expressed his agreement with Sir Arthur Fadden’s proposition and he predicted that the actual deficit at the end of the year would be much less. So it was. In the meantime, and at the same time, by the Treasurer’s bold action and initiative, the gathering storm was dissipated. May I say, Mr. Temporary Chairman, that if the Leader of the Opposition proposes to emulate Sir Arthur Fadden it would appear that despite the Australian Labour Party’s attitude to honours, Mr. Calwell has a much better chance of becoming Sir Arthur Calwell than Harold has of becoming Sir Harold.

It is now a serious crime, apparently, to purchase a motor car. Apparently, the crime is many times more serious than that of stealing a car if we can judge by the size of the penalty. The penalty for stealing a car may be as low as £5 but the penalty for buying a car must be counted in hundreds of pounds. The penalty is euphemistically styled a “ sales tax “. It may be said that no Commonwealth law compels any citizen to have a motor car. Nevertheless, there are other compulsions such as transport costs. A citizen with a family has to take them into consideration. Another compulsion may be the fact that a citizen’s home is not convenient to public transport.

There used to. be a saying in this country that Australia rode on the sheep’s back. It is becoming more and more true that governments ride on the motorist’s back. I think, Mr. Temporary Chairman, that in some ways motorists resemble, and are as docile as, sheep. What a law-abiding people we are to accept a situation in which sales tax at the rate of 30 per cent, is levied on the family motor car. Signs of revolt appeared when the Government, last November, jacked up the rate from 30 per cent, to 40 per cent.; so much so that, twelve weeks later, the Government panicked and brought the rate back to 30 per cent.

Sometimes I think it is a great pity, in one way, that the people do not use the economic power which still reposes in their hands, if they use it collectively, to force down the prices of all motor cars in Australia, because I have a strong feeling that the prices of most cars are unnecessarily high - indeed, far too high. We seem to have reached a stage at which the price of any article has little or nothing to do with its cost of production. What happens is simply expressed by saying that the price is whatever the seller thinks he can get out of the buyers’ pockets. It is equally certain that the rate of sales tax has no particular relation to anything. The tax is levied according to whatever the government of the day believes the people will accept without vehement and articulate reaction.

This Budget is notable for the things that it does not do. It has been called a standstill budget and a stay-put budget. It seems to be based on an assumption that if you do not do anything you cannot do very much wrong. Not that the Government has been completely immobile. It has not. The mountain has laboured and brought forth, not one mouse, but several mice. There is a little bit of something for those whom I like to think of as the annuitants, a little bit of something for a corned-beef road in Queensland, a little bit of something for ex-servicemen, a little bit of something for the unemployed, and nothing much for anybody else, but plenty of pie in the sky for the sweet by and by.

Seeing how reluctant the Government seems to bestow any blessings, one would have thought that when presented with an opportunity to give something to a section of the community without cost to itself the Government would have grasped that opportunity. I am referring now to the permissible limit of earnings for civilian widows in particular. This limit has been fixed for some years at £3 10s. a week, and it still remains at this figure. The life of the civilian widow is made doubly difficult. First, she must find a job. Secondly, she must persuade her employer so to arrange her hours of employment, within the framework of the appropriate industrial award, as to allow her to earn not more and not less than £3 10s. a week. To any one who knows anything about industrial awards - there are many honorable members, on this side of the chamber at least, who know quite a lot about them - it will be immediately apparent how difficult this can be. Few industries and unions encourage employment on a part-time basis. Engagement is on a weekly basis or not at all. Therefore, the employment opportunities for widows are limited by factors other than, or additional to, the care and attention that they must give to children, where there are children.

I can see no reason whatsoever for the special discrimination that is practised against civilian widows. It is not as if the Government was unaware of their situation. The Government is well aware of it. When reminded from time to time of this harsh and unjust discrimination, the Government pushes its tongue farther into its cheek and indulges in an orgy of selfpraise, but does precisely nothing for the widows.

I had expected that, since no cost to the Treasury would be involved, this Budget would have eliminated the means test on the earnings of civilian widows. But it seems that their numbers are not strong enough electorally to cause the Government any concern. I have in mind a case which dramatically highlights my contention that this means test ought to be thrown out neck and crop, Mr. Temporary Chairman. In my office I have a letter from a widow whose husband died in tragic circumstances very suddenly eighteen months ago, leaving a debt of £1,000 on the home. This debt calls for repayments at the rate of £6 a week. The mortgagees refuse to reduce the scale of payments or to extend the time for repayment. The widow is in poor health, but has managed to obtain part-time work. She derives no benefit from that employment from the moment at which her earnings reach £3 10s. a week. From that moment on, every penny that she earns reduces her weekly pension by one penny, until, £4 7s. 6d. later, her pension vanishes. By earning £7 17s. 6d. a week, she loses the whole of the pension. Perhaps some Rabelaisian sophister in the ranks of the Government can justify this means test on the earnings of a civilian widow. I cannot.

There is another angle to this matter of the means test on income as it affects the pension of civilian widows - an angle which seems annually to escape notice. Between the ages of 40 and 50, women pass through the most difficult phase in their lives. If there is one time when their health is poorer than at any other, this is the time. Yet a woman without children under sixteen who is widowed at 40 on the eve of this very difficult phase of her life, when she most needs help, must wait another ten years before she can qualify by age for a widow’s pension. Certainly, she can get unemployment relief, if she cannot get a job, or, if her health breaks down beneath her dual burden of grief and worry, she can get an invalid pension, provided that she can prove that she is 85 per cent, incapacitated for work. I have found that this is extremely difficult for quite a large number of women to prove.

The existing situation calls loudly for attention, Mr. Temporary Chairman. One cannot but marvel at the patience of civilian widows. There exists not one tattered shred of justification for the bias practised against them. Yet budget after budget comes and goes, Treasurer after Treasurer comes and goes, and this injustice is allowed to continue. There is no excuse for it. When the Government is reminded of it, we are treated to a dreary and dismal dissertation on the manner in which this big-hearted, benevolent and philanthropic government has adjusted the widow’s pension from time to time over the last twelve years. These wearisome recitations can be regarded only as insulting to the intelligence of our people. Of what use is it to mention only two factorswhen there are three? The first factor is time; the second is money; the third is value. So I ask for a little more honesty on the next occasion when we are forced to listen to that scratched and ancient record which comes to us in the very best Caledonian or Harry Lauder accent. I hope that we will be told that the Government will give us that third factor - value. I hope also that all will see that, despite any increase in the amounts over the past twelve years, there is still no change for the better. If anything, the value has gone down.

I want no one to infer that all members of the Government are completely heartless. 1 know that some of them do spend some of their time pondering this matter and that they deplore the state of affairs. But there it ends. They simply deplore it, and leave it at that. That is not good enough. Any wrong that is so inexpensive to make right should never be permitted to remain, i do not regard my own party as completely blameless, but since we have not governed for the past twelve years, and remembering that we carried the burden of government during the years of war and grappled with the enormous problems of post-war reconstruction for four long years after the war, we might be forgiven. But there can be no pardon for a government in whose hands the power to act has remained continuously for twelve long consecutive years. That is all I want to say on the matter of civilian widows, but I hope that what I have said has been noted and will have the desired effect.

Now I want to refer to a statement made by the honorable member for Fremantle (Mr. Beazley). When he was speaking on unemployment the honorable member said that there were registered in Australia something like 113,000 unemployed persons. I think he put the position in the best possible and most effective light when he asked: What would the Government have said had there been 113,000 people on strike? The Government would have talked about the man-hours lost, the production lost, the profit lost. But the members of the Government can sit calmly, not turning a hair, and contemplate the fact that 113,000 people are out of work and out of production. 1 now turn to a few remarks on foreign borrowing. The Treasurer boasts that people overseas are still prepared to lend us money. What a thing to boast about! There are very few places in the world where it is safe to lend money now. If money is lent in South America, down comes a revolution and the money lent is lost forever. Australia is one of the few places where it is safe to lend. In this regard 1 will stand up for Australia on all occasions, because we stand by our word, and pay our debts, but do not boast about it, because after all it is a very unstable world. A few weeks ago 1 got into conversation with a Canadian friend who told me that American investment in Canada had been so great that the bulk of Canadian industry was either owned or controlled in the United States. One result of this was that at any time when there was a world falling-off in the demand for the product of a Canadian industry that was owned or controlled by a parent American industry the Canadian industry would be closed down so that the parent industry in America could keep going on the available orders. That is precisely what I am afraid is going to happen here. I believe that we will yet rue the day when we set out to countenance, encourage and seek too great an amount of foreign investment in this country.

What does the average Australian want out of life? What he wants most is security. He wants from life and his government a few little luxuries, and he wants freedom from worry. I am afraid he is not getting freedom from worry now. If there is one country in the world which is famous for its addiction to private enterprise it is America, lt is no mere coincidence that the people of that country swallow the world’s record number of tranquillizing drugs. This is the penalty the Americans pay for making the dollar their god.

What do the parents of Australia’s children want from life and from their government, for their children? I would say that what the average Australian parent wants for his children is the right to a decent education, the right to a decent job, the right to a decent home, and the right to feel that if some unfortunate and unforeseen calamity befalls them the community will come to their rescue. I am afraid that in Australia now we cannot say that that is so. The last and most important thing that Australians want is the knowledge that in their old age they shall not be forgotten and have to live in want.

This Budget is a poor and tattered thing. At a time when we need more of everything - people, migrants, jobs, houses, roads, schools and universities - the dead hand of the Government drags on the brake-. The rest of the world goes forward while we stand still. I do not believe, Mr. Temporary Chairman, and I cannot believe, that that is what the people of Australia are prepared to accept. Let us hope, let us work and let us pray that this Budget is the last with which this Government will blight this country.


.- The committee is at the tail-end of what has been a rather long discussion of the Budget, and has listened to a great variety of speeches. I think that in forming an assessment of the speeches that have come from members of the Opposition one would come to the conclusion that the striking feature has been that on this occasion there has been a measure of unanimity. But the measure of unanimity has concentrated around one point. That is, the claim by all honorable gentlemen opposite that all the instincts of benevolence are held by them, and that those who support the Government, and the members of the Ministry themselves, are a harsh, uncompromising, timid and, at the same time, a rather ruthless collection of people. With very great respect to those who hold that opinion, Mr. Temporary Chairman, it is not well formed.

The two most remarkable speeches that came from the Opposition were delivered by the Leader of the Opposition (Mr. Calwell) and the Deputy Leader of the Opposition (Mr. Whitlam). The committee will recall that the Deputy Leader of the Opposition started off by rebuking the Prime Minister (Mr. Menzies) because the Prime Minister had dared to say to the Leader of the Opposition, “ What you are trying to do is to whip up a feeling of depression throughout the country “. The Deputy Leader of the Opposition took great exception to that. Indeed, he gave me the impression at one time that he was in a fit of the sulks about it, and he complained quite bitterly. I listened to the speech of his leader, and I subjected myself to the task - indeed, the ordeal - of reading it, and I found nothing in that speech as recorded, and I recall hearing nothing when he delivered it, that would give me the impression that it was a cheerful speech. In fact, I warrant that if any individual without any knowledge of what was going on had walked into the chamber and listened to the honorable gentleman deliver his speech he would hardly have formed the impression that the Leader of the Opposition was conducting the village glee club, even if the honorable gentleman had said, “Watch my beat, please. Thank you.” There was no suggestion at all of cheer in his speech, and one is left to come to the conclusion that as far as the Leader of the Opposition is concerned, politically speaking, depression is the Mediterannean of the honorable membr’s mind and he has got no more exciting ambition than to bathe in its waters and to bask in its sun. Right through the whole of the honorable gentleman’s speech was the theme of depression, and that, of course, reveals the key to the Australian Labour Party’s hopes of electoral success. They say, “ If we can whip up, substantiate and maintain the feeling of depression throughout the country, our prospects are enhanced “.

If honorable gentlemen opposite think that that is a rather harsh assessment to make, I invite them to look at the language used by their leader. He used such words as “ hardship “, “ disaster “, “ depression “, “ recession “, “ slump “ and “ sickness “. With very great respect to the honorable gentleman, I say that one could not listen to those expressions used in the context in which they were used, or particularly, read them, and form the conclusion that this man is a man of good cheer. The extraordinary feature of his speech was that he combined with these melancholy expressions the idea that we must be more adventurous. Yet the honorable member for St. George (Mr. Clay), who resumed his seat a few moments ago, said that what we need is more security! His leader said that we must be more adventurous. Then, in addition, he said -

We want no “ dead end kids “… 1 though that quaint collocation of sentiment was deserving of some mild poetic recapitulation, and this is what I have arrived at -

Our prophet from Melbourne is sore, ] So his speech held forebodings galore.

We heard howls of “ Depression “,

And growls of “ Recession “,

Quite one dozen times, if not more.

Oh, we will adventuring go,

Quoth Arthur “ Old Harold’s too slow,

With a deficit Budget,

We know we can judge it,

To cause plenty money to flow “.

He says, “ Labour won’t have dead-end kids,

Now listen to our tempting bids “.

But when Poll results show,

The poor fellow will know,

That he’s off to a dead-end on skids.

I turn now to some of the more serious arguments put by the Deputy Leader of the Opposition. With unbecoming modesty, at least for him, he said, when referring to his leader -

  1. . the Leader of the Opposition brought down his moderate and constructive proposal for a budget deficit.

If we go through the speech made by the Leader of the Opposition, taking with it the speech made by the Deputy Leader of the Opposition, and try to work out precisely what they have in mind, we arrive at an interesting conclusion. First, the Leader of the Opposition said quite explicitly that sales tax revenue should have been slashed by at least £50,000,000. We will take him at his word and put down £50,000,000. Then he said certain income tax adjustments must be made. If we work out the cost of these on a very conservative basis, we reach a figure of £26,000,000. He complained that the Government has not done anything to lift family allowances. Let us put a minimum there of £35,000,000. The honorable member for St. George joined with his leader in an attack on the Government regarding age and invalid pensions. One is left to assume they would consider an additional expenditure of £30,000,000 as moderate and modest. The Leader of the Opposition would no doubt say that £60,000,000 would cover his additional expenditure on miscellaneous social: services.

His proposals regarding war service homes would involve an additional expenditure of £16,000,000. He sneered at the Government’s works programme and we were left to form the conclusion that a minimum of £30,000,000 should be added to this item. He has repeatedly expressed the view that development in northern Australia calls for a yearly expenditure of £100,000,000. Goodness only knows what he would spend it on, but that is his proposal. He criticized the Government over the Development Bank. Again one is left to conclude that its capital should be increased by a further, say, £20,000,000. He said explicitly that all revenue from petrol tax should go back to the States, and that would involve an extra £55,000,000. He said that pay-roll tax should be abolished altogether. This is another £61,000,000.

Then he said that Labour wants to form an overseas shipping line. Again let us take him at his word. How much change do honorable gentlemen opposite think they would have left out of £100,000,000 if they were to form an overseas shipping line and assist it to establish itself? A very conservative estimate of the cost is £100,000,000. He then said that they want a national insurance company. This would involve capital at the outset of, say, £5,000,000. On the subject of education, the honorable gentleman has tried repeatedly to disturb one of the dominant characteristics of the federal system of government. He has said that the Commonwealth should assume all responsibility for education. This would involve another £20,000,000. His proposals on repatriation come to another £15,000,000. The Deputy Leader of the Opposition said, “The Government is only fiddling with the Commonwealth Scientific and Industrial Research Organization “; and so we can add another £10,000,000. He sneered- I thought in an almost vicious way - at the money being spent on the search for oil and various mineral deposits throughout Australia. He described the efforts as being meagre. Under the proposals of the Deputy Leader of the Opposition, another £20,000,000 could be added.

I am quite sure that you, Mr. Temporary Chairman, and other members of the com mittee have been adding these figures together and have reached the conclusion that these moderate and constructive proposals of the Leader of the Opposition would require a further £653,000,000. Apparently these proposals meet with the support of those who sit behind him. I want to say to the Deputy Leader of the Opposition that if he describes this set of proposals as representing a moderate and constructive approach, one is left to conclude that a strange sense of irrationality has consumed him. Indeed, one could almost describe him as the ostrich of economic life. I say to the honorable gentleman with all goodwill that emulating the ostrich would not only be a most uncomfortable and unprofitable position but from his viewpoint would also be a most indecorous position - all too revealing.

To come back to our muttons, let us consider how the additional £653,000,000 would be raised. Suggestions coming from Opposition gentleman would indicate for a start that the defence vote could be abolished. Are they prepared to go out and say to the people of Australia at this critical time in our history, “ We propose to wipe out all provision for defence “? In that field, the Opposition would have £200,000,000. Or is their proposal to finance their ideas by resorting to treasurybills? Again, are they prepared to go out and say to the Australian people, “ We intend to resort to treasury-bill finance to the tune of £653,000,000 “? Or are we to assume that they would seek to raise this amount by imposing a capital gains tax? They would seem to me to be the three areas in which Opposition members would have some scope for manoeuvre, but, whatever they do, I believe there is a responsibility devolving on them to speak plainly on this issue and to tell the Australian people how they would finance their proposals.

Now I turn to a third argument used by the Deputy Leader of the Opposition. I am trying to cull out those that seem to me to have a little substance in them and that are, at least on the surface, respectable. His third argument seems to me to conform to these requirements. Here, I am referring to his criticism of the Government regarding the imports position. You will recall that the honorable gentleman criticized the

Government for having virtually abolished import licensing. These are his words -

We would re-impose licensing in order to bring a greater consistency and steadiness into our import flow . . .

If there has been one thing in the last ten or twelve years that has distinguished the Australian Labour Party in all fields of political endeavour, it has been its sense of opportunity. In no respect is this more dramatically revealed than in its attitude to import licensing. The committee has heard the language used by the Deputy Leader of the Opposition. He said -

We would re-impose licensing . . .

Yet his leader of that time, Dr. H. V. Evatt, said on 27th September, 1955, in this chamber -

This policy of restricting imports will not cure the inflationary position . - .

A policy providing for cuts in imports is not a positive policy but a purely negative one.

I put it to the Deputy Leader of the Opposition: In 1955, did he or did he not support his leader? His leader was quite plain then in his statement. He said bluntly that a policy providing for cuts in imports was a negative policy. To-day, the honorable gentleman who has the role of Deputy Leader of the Opposition has said that if the Australian Labour Party is given office as the Government it will re-impose import licensing. In 1955, the honorable gentleman nodded vigorously behind his leader’s back supporting the idea that import licensing was negative and not positive. To-day, he says that he and his party would re-impose import licensing. Allied with that comes his fourth argument. This is the argument used by the honorable gentleman -

  1. . the Government should have used the weapon of import controls to further the expansion of our manufacturing industry and to negotiate openings for our export trade.

That is a very interesting argument because it is useful to recall that it was the Australian Labour Party, when in government, that negotiated the General Agreement on Tariffs and Trade on Australia’s behalf. It was a Labour Minister who commenced the procedures of the House which enabled this Parliament to ratify the agreement. What the Deputy Leader of the Opposition said to the committee the other night amounted to a blunt and frank repudiation of a contract entered into and negotiated by his own party when in office. Article III. of the agreement states among other things -

The contracting parties recognize that internal taxes and other internal charges, and laws, regulations and requirements affecting the internal sale, offering for sale, purchase, transportation, distribution or use of products and internal quantitative regulations requiring the mixture, processing or use of products in specified amounts or proportions, should not be applied to imported or domestic products so as to afford protection to domestic production.

You can assess the honorable gentleman’s political stability and integrity on this issue. His own party negotiated the agreement. To-day, as one of its spokesmen, he rises in the National Parliament and repudiates that agreement in the frankest possible terms. What the honorable gentleman said the other night amounts to a repudiation of the policy of his own party. Unless some one can bring me up to date on a change, the present platform of the Australian Labour Party still provides for support of Australian industries through tariff protection. Paragraph 5. (a) of the objectives of the A.L.P. provides for -

Effective tariff protection of Australian industries and import embargoes in favour of Australian industries capable of supplying the home market . . .

The two must be read together. There is no suggestion here that the mechanism of the tariff machine should be thrown overboard and jettisoned; yet the Deputy Leader of the Opposition said the other night, in effect, “ So far as the platform and policy of the Labour Party are concerned, I reject them, and so far as Gatt is concerned, I reject that too “. I turn now to another of his arguments; and this is the last one that I shall have time to deal with. The Deputy Leader of the Opposition said, in referring to the Treasurer, that this was - . . the end of more than a decade of continuing failure . . . and, above all, failure to ensure for our people a steadily expanding prosperity.

I thought that represented a great insult to the Australian people. Whatever obsessions the honorable gentleman might have, it would seem quite plain that he has an obsession for fiction and a contempt for fact; because when you look at the record and take consumer goods as a reasonable indicator of the rise in prosperity levels throughout Australia, you see a remarkable picture. In 1949, for example, Australia produced 145,600 refrigerators. In 1960, at the end of ten years - a period despised by the Deputy Leader of the Opposition - Australia produced 241,200 refrigerators. In the same period, the production of vacuum cleaners rose from 65,700 to 95,700, and the production of washing machines rose from 6,500 to 200,100.

Our population, in June, 1949, stood at a little over 8,000,000. At the end of this despised period of ten years, our population had increased to something in excess of 10,200,000 at June, 1960. In 1949, in the halcyon days of the Australian Labour Party, 4.1 persons throughout Australia shared each dwelling unit. In June, 1960, the figure was 3.5. Each telephone, in 1949, had to serve 10.7 of our population. At June, I960, thanks to the remarkable enthusiasm shown by my friend and colleague the Postmaster-General (Mr. Davidson), there was one telephone service for 4.75 persons. In the cheerful days of the Labour Party, in 1949, there was a radio receiver to every 4.5 of the population. The comparable figure was down to 2.7 at June, 1 960. There were no television receivers in 1949, but to-day there is a television receiver servicing every 9.3 of our population.

The Deputy Leader of the Opposition wept crocodile tears for the motor industry. In 1949, each motor car was shared by 12.2 persons. At June, 1960, the figure was down to 5.3. I interrupt myself to say this: I am reminded of the honorable member’s defence of the motor car industry. Is any one of his colleagues prepared to deny what has previously been said in this place that given the opportunity and the proper circumstances, the Labour Party assuredly would bring under complete government control the entire motor car industry of Australia? I hope that some of the motor car producers in Australia realize that when they look at the gun of the Australian Labour Party, it is a loaded gun, and that, given the opportunity, the Labour Party will assuredly use it. The last point I want to make is this: Australia is a nation that has been, and is still, on the march. It is a nation that has made remarkable progress over the past twelve years.

Sitting opposite us we see the representatives of a party in full retreat, a retreat that is steadily taking them away from the sound and established principles of economic and political behaviour. In the 60 years of federation in Australia no party has been more grievously divided than is the Australian Labour Party to-day. It barely qualifies to be an Opposition. It is now going before the Australian people seeking a mandate to form a government. I say that to give to the Australian Labour Party a mandate to form the government of this country would be to visit upon the splendid achievements of the last twelve years all the wreckage of that party’s yesterdays. So I say that this country, deserving as it may be of many things, is certainly not deserving of such a singular stroke of political vandalism.


.- I rise to support the amendment moved by the Leader of the Opposition (Mr. Calwell). In doing so I would point out that the honorable gentleman did not content himself with mere criticism. He put forward what to my mind, and apparently to the minds of editors of the daily newspapers, were constructive proposals, telling the nation what Labour would do if it were returned to office. Of course he was greeted, as such proposals are always greeted, with the question, “ Where will the money come from? “ There are always certain persons willing to manipulate figures in an endeavour to prove that proposals of the kind outlined by the Leader of the Opposition involve a greater cost than they actually would if implemented. The man in the street has a ready answer to the question as to where the money would come from. He says, “ If a war were to break out to-morrow, where would we get the money from to engage in it? “ Strangely enough, whenever money has been required to wage a war it has always been found. The late John Curtin said during the period of World War II., “ What is physically possible is financially possible “. Those words are as true to-day as they were then.

I asked the Treasurer (Mr. Harold Holt) a question in this chamber about ten days ago. I asked him to give us an indication of the cost to the nation, week by week, of the miserable unemployment benefits that are being paid. The Treasurer evaded the question, promising that he would subsequently furnish me with the information. He has not yet done so. I asked the question because I wanted to get an idea of the cost involved, not only in paying unemployment benefits, but also in loss of production and even, as one honorable member suggested, in loss of profits. Competent persons have suggested that in fact the unemployment situation is costing the nation no less than £200,000,000 a year. Apparently we can afford this loss of production. Apparently we can afford to have men in idleness, and apparently we can afford the £200,000,000 a year that is involved. But when a programme is suggested that would involve budgeting for a deficit of £100,000,000, we are told that it is utterly impossible. Yet £100,000,000 is only half what the present unemployment position is costing us in terms of money, quite apart from the social cost in hardship and misery.

The Budget is notable for the miserable increase in unemployment benefits payable to persons who have lost their employment through no fault of their own. Practically all industrial tribunals throughout Australia have adopted a principle which requires that if an employee can be reasonably expected to have to lose time because of the exigencies of the industry in which he is engaged, his wage should be loaded to compensate him for such lost time. This is a fair principle, and it is fairly applied. In the case of my own trade, it has been calculated that a plumber loses time, between finishing one job and starting another one, to the extent of two weeks in every 52. Accordingly, the wage is loaded to an extent that will compensate the employee for the loss of two weeks’ pay every year because of the exigencies of the industry.

I know that this is not the best and the soundest proposition, because, in actual fact, some men get the compensation although they do not lose the time. Of course, there are others who lose more than the two weeks in a year. However, I simply point out that this is a principle recognized in industrial jurisdictions. If it be a fair principle, is it not fair to say that the 120,000 men and women who have been thrown out of work because of the Government’s economic measures should be compensated for the hardship inflicted upon them, even if it means straining the economy a little?

Mr Cash:

– What did the Labour Government pay in 1949?


– I will tell you. I will go back even a bit further than 1949.

Mr Cash:

– That will be far enough.


– I will go to an earlier period than 1949, if you will shut up for a little while. During 1929 and 1930 I was unemployed, as were many others. I was in Western Australia at the time, and a Labour government was in office in that State. I was given two days work a week as unemployment relief. The relief work system meant that a single man would be paid 30s. a week, at a time when the basic wage was about £4 a week. That payment represented a greater proportion of the basic wage than the unemployment benefit represents to-day.

I believe that members of the Government can be justly accused of adopting a callous attitude towards unemployment. The honorable member who has just been interjecting certainly deserves such a charge. One has only to mention unemployment in this chamber, and the condition of the unemployed, to hear a ripple of merriment from honorable members opposite, particularly those on the Liberal Party benches. One has only to look at statements made by members of the Government to appreciate their attitude towards unemployment. The Prime Minister (Mr. Menzies), for instance, says, “ If you have to tread on somebody’s corns in order to benefit the nation, just pick out the corns to tread on” - and, of course, he treads upon the workers’ corns. In the Melbourne “ Age “ of 29th August, 1961, the Prime Minister is reported as having said -

And of course the speed with which the upturn can affect employment is a different problem, because there has been a good deal of building up of stocks and they have to be cleared out of the pipelines to a reasonable extent, and then there has been a little choking along the line of trade credits, from the retailer to the wholesaler to the manufacturer. When they are cleared up there will, I think, be a marked effect on employment all down the line. But until that happens I am not looking for anything exciting about this upturn, expressed in terms of employment. I think the position will go along quietly.

That is all the Prime Minister cares about it. On 9th May, 1961, the Treasurer stated -

The Government’s measures are proving effective and it is clear that the boom has subsided.

That was an echo of the statement made last February in the Administrator’s Speech that the Government’s economic measures were having the desired effect. At that time the desired effect, of course, was that the building industry was to be depressed by nearly 30 per cent., and, as it turned out subsequently, to an even greater extent. The Treasurer has been known to say that the building industry was in an unhealthy situation. The industry had the temerity twelve months ago to produce 100,000 units for the people to live in. Now the Treasurer proudly states that the industry has been brought back to a much healthier position - 80,000 units. So, the building industry was depressed; the motor vehicle industry was depressed, and the textile industry was depressed. A recent survey disclosed that many industries are working to less than 30 per cent, of their capacity. The Budget contains no proposals to deal with the situation. It offers no hope.

The honorable member for Moreton (Mr. Killen), who preceded me, mentioned the General Agreement on Tariffs and Trade. The other day, I read something about that matter and I should like to repeat it to honorable members. On his way to the Prime Ministers’ Conference, the Prime Minister obtained a loan from Switzerland and presumably made arrangements for the loan just granted by the International Monetary Fund. That the Government had no choice in the matter is confirmed by the Treasurer’s statement, as reported in the “ Herald “ of 1st May.

When referring to the speech of the president of the Chamber of Manufactures he stated that in the general arguments Mr. Moore had made in favour of import controls, he had significantly omitted any reference to Australia’s international obligations under Gatt and its membership of the International Monetary Fund which forbid Australia imposing import controls except to meet serious balance-of-payments difficulties. The honorable member for Moreton alleged that the Deputy Leader of the Opposition (Mr. Whitlam) was advocating a repudiation of the agreements that were entered into by the Chifley Government. I refer specifically to the General Agreement on Tariffs and Trade, which was made at Dumbarton Oaks. As the

Treasurer mentioned, the agreement forbids Australia imposing import controls except to meet serious balance-of-payment difficulties. There is provision that if serious balance-of-payment difficulties arise, import restrictions can be re-imposed on a selective basis. That is all that we of the Opposition have suggested. To charge the Deputy Leader of the Opposition, as the honorable member for Moreton did, with suggesting repudiation of international obligations is unwarranted and unfair. We feel that as we have a serious balance-of-payments problem we shall get our industries working only by the re-imposition of selective import controls. I have pointed out that many industries are working at only 70 per cent, of their capacity.

The honorable member for Moreton stated, quite correctly, that the nation’s productivity has increased over the past ten years. That is what one would expect. He stated also that our population has increased, mainly through immigration. We have made a remarkable increase by means of the migration scheme which was established by the Chifley Government. Although our productivity has increased considerably, it has increased in an out-of-balance fashion, hence the reason for the Government’s economic proposals.

Let me return now to those proposals. It is interesting to note that the Government entered into commitments in relation to Gatt and the International Monetary Fund, and, as one learns from the correspondence passed between the Treasurer and Mr. Jacobsson, the Government has agreed that the present situation will continue at least until June next year.

When speaking on the state of our economy the Minister for Labour and National Service (Mr. McMahon) stated on 26th April last -

As to the economy as a whole, I think it would have been fatal to make any major change before now in the policies we announced in AugustNovember. In other words, the policies ate working out much as they were expected to work out. They have achieved good results.

If to depress industries to the point at which they are working now - 30 per cent, below their capacity - and if to have 13,000 men and probably more by now, out of work, with the consequent loss of production, can be described as “ good results “, the Government is welcome to them. The Leader of the Opposition has stated exactly what we propose to do if we achieve office. I should like to read some of his statements because they are well worth reading. On 22nd August he stated -

If we win the coming elections, we will introduce a supplementary budget in February in which we will seek to repair the damage the present Government has done.

We will increase the deficit to £100,000,000 if necessary so as to help to re-employ the unemployed.

Mr Anderson:

– In four months!


– I thought that would hurt you. As I said before, some honorable members on the other side seem to think that unemployment can be made the subject of a joke. I make no bones about it. The Leader of the Opposition went on in this way -

We will restore full employment within twelve months.

We will take immediate steps to revive from the present depressed condition of the key industries of motors and of house building on which so many other important industries in this country depend by appropriate taxation reductions.

Probably more ancillary industries are associated with buildingthan with any other industry that one can contemplate.

Mr Kearney:

– It has 21 ancillary industries.


– Yes, 21 ancillary industries. There are 21 ancillary industries. The Government deliberately depressed that industry by 30 per cent.; but such action should only have been contemplated in the direst circumstances. The Government cannot have it both ways. It cannot say the economy is stable and flourishing and, at the same time, excuse the attack it made upon this industry. The only reason which could be given for the things the Government has done and the situation it has brought about is that there was an urgent need to safeguard the economy. Whether the Government did the right thing or the wrong thing is beside the point; but I say it has done the wrong thing.

The Leader of the Opposition said -

We will make it easier for people to borrow on reasonable terms from various established businesses. We would give the States the whole of the proceeds of the petrol tax . . .

And why not? Where does that tax come from, except from the States? -

We would remit pay-roll tax on municipal and local government activities, other than trading activities. In a word we would correct the Menzies’ Government-created slump which is the worst this country has known since the depressed thirties.

That is the programme Labour would implement. It is quite a different programme from the one the Government has implemented and which has brought such disastrous results for our economy. The Budget offers very little to the unemployed and very little to anybody at all. The position of the wife of the invalid pensioner remains the same - a shocking position as she has to keep herself and look after her husband on 35s. a week. The position of the repatriation pensioner is slightly improved, but only so slightly as to take up the depreciated value of the currency. In actual fact it is not really improved at all. The position with regard to education and general development remains the same. It is true that there has been a hand-out for party purposes in a couple of electorates. There has been a hand-out of £650,000 to Queensland for the building of roads. How much road can be built for £650,000 in a vast State like Queensland? I do not doubt that the whole of it will be spent in one particular electorate. There have, of course, been promises of assistance in Western Australia. Beyond those few items it is a dull and stupid budget.

I want to conclude by again referring to unemployment and the attitude of some people towards the unemployed. In the Sydney “Daily Telegraph” of 18th August last, under the heading “ Aust. ‘ Doing well’, says U.S. Banker “, we read -

A leading U.S. merchant banker said yesterday he wished everything in the U.S. was in such good shape as things in Australia. The banker, Mr. Floyd G. Blair was addressing a meeting of the Australian-American Association in Sydney.

Mr. Blair said a return to full employment in Australia would considerably endanger the country’s economy.

He claimed that if Australia tried to revert to a policy of full employment:

People would not work hard.

Costs would rise.

Inflation would follow.

Mr. Blair has been in Australia a week, meeting business and the political leaders.

That is the attitude of some people towards unemployment and towards full employment. All 1 can say is that this leading United States banker could qualify to be a Liberal Party member of this Parliament. What he said reminds me of the late Colonel Grimwade, chief of the drug house of Felton and Grimwade, who said, “ Unemployment is the creator of healthy endeavour and respect for authority “. And the following year he was knighted. I am pleased to say that the following year he was promoted to glory.

Mr Turnbull:

– That is a shocking statement.


– Shocking? ls it not shocking that a wealthy man, a big company director, should say that unemployment is the creator of healthy endeavour and respect for authority? In those circumstances, I make no apology for what I have said. He and the kind of people he represented would starve men into submission to their will. That is an attitude that is all too prevalent in the community to-day. Once again I say to those who say, “ We welcome unemployment and look upon it as the golden road along which we must travel to prosperity “, that we do not welcome it. Most of us have suffered unemployment and we will continue to tell the world our views as far as unemployment is concerned. We are not going to be deterred from doing so by people who claim we are prophets of doom and calamity howlers. Have we not the right to protest about it? We propose to keep on protesting.

PostmasterGeneral · Dawson · CP

– The honorable member for Darebin (Mr. Courtnay), in the welter of things he stated, made a remark which caught my ear. He said that this Budget offers no hope of any form of alleviation for the people of Australia. In actual fact, as has been pointed out by honorable members on this side of the House, this Budget is deliberately designed to preserve the stability which we have been successful in restoring to the economy of Australia by the actions which we took last November and what we did following that action. The taking of that action was not a particularly pleasant task; we knew it would produce a certain amount of unpopularity. But we took it because we knew it was necessary in the interests of this country.

Since 1 have had the privilege of being associated with this Government, since 1949, a feature of it has always been that when it found it necessary to take action designed to improve the economy of the country, it has taken such action regardless of its effect on the popular mind. The position was that we faced an inflationary boom. I now give the honorable member back his own term, when I say that had that inflationary boom continued there would have been no hope for the people of Australia. Had inflation not been arrested, or should it have been possible for the Opposition to put into effect its grandiose promises with the result that all the good we have done in the last few months was lost, again there would have been no hope for the future, because the inflationary forces which we arrested at the time of the boom would again have been established and would have had the same effect as they had early in 1960.

This Government has resisted any temptation to bring down at this stage just a popular budget for the purpose of tickling the ears of the people with a view to securing votes at the forthcoming election. Instead, we have brought down in this Budget and the legislation associated with it certain restraining controls on the speculative enterprises which were proving to be so damaging to our economy. We have brought down a budget which seeks instead to channel enterprise into reproductive development. I emphasize that this is a very important phase of the Budget, and I shall deal in further detail with that point later. The Budget is also designed to channel enterprise into the development of employment in certain areas and certain industries which are in themselves also reproductive. It seeks, too, to channel enterprise into avenues which will build up export earnings, and which will assist such industries as building.

Before passing on to my main theme in refuting some of the statements made by our friends opposite, I point out that as I move around the country I find an evergrowing realization of the fact that the Government was justified and correct in the action that it took in November. I find, too, that because of this realization we are receiving more and more credit for taking the action we did. There is a growing realization that because of the action we took we are able now to bring down a sound budget, one which will preserve our stability and avoid a return to inflationary finance, one which is in direct contrast to Labour’s policy as expounded recently by honorable members opposite - a policy of boom and bust. The honorable member for Darebin (Mr. Courtnay) sneered at some of the Government’s proposals for developmental work, and he referred to roads in particular. He said that the Government had given a hand-out of £650,000 to Queensland and that it had promised some small aid to Western Australia. From what he said, it seemed to me that he failed completely to realize the object of the Government’s expansion and development policy. In that regard he was following a lead given to him by some of our critics, no doubt by some of the press, and it was obvious that he was dealing with a subject which I think should be fully explained so that all those who are in a position to assimilate facts as distinct from misrepresentations will understand the Government’s policy, especially the roads programmes announced recently by the Prime Minister (Mr. Menzies) and the Treasurer (Mr. Harold Holt). As that is a fairly big subject, the discussion of which it would not be wise to interrupt too early, may I suggest that this would be a convenient time to rise for dinner?

Sitting suspended from S.47 to 8 p.m.


Mr . Chairman, prior to the suspension of the sitting I spent a few minutes in making some general comments on the Budget. I indicated that the main object of my speech was to deal with the Government’s developmental proposals, particularly those relating to Queensland. It is to that subject that I shall direct the rest of my remarks.

I believe that the proposals put forward by the Government prior to the Budget, and in the Budget, for the development of Australia are the most important features of the Budget and of recent legislation. Their object, particularly in northern Australia, is to develop our export potentiality. It has been a matter of some disappointment to me and to my colleagues to find that since the presentations of these proposals, there has been considerable misunderstanding of them. This has been revealed in contributions to this debate by some members of the Opposition and in newspaper criticism.

Let me concede, at this stage - I would not have stated this a week ago - that my colleagues and I are particularly glad about the result of a conference which was held last Thursday night and which has been referred to in a joint statement by the Prime Minister (Mr. Menzies) and the Premier of Queensland. This has demonstrated that in some quarters - I hope in State government quarters - there is now a full understanding of the reasons behind the Government’s developmental plans and an appreciation of their wide scope, although possibly that understanding and appreciation have not yet flowed out through the press to the people whom we represent. Because of that, Mr. Chairman, 1 propose to make a few remarks to-night which are designed to clarify the matters that have been the subject of misunderstanding between us all recently.

I consider that a proper statement on these matters is required in order to be fair to the Government, which has been fair to Queensland and which is doing its utmost, while meeting its responsibilities to the other States, to plan for the proper development of Queensland. It is also fair that I, as a Queensland member, should say these things on behalf of my Queensland colleagues who, over a long period, have been doing their utmost and have been exhibiting a great deal of tolerance in this matter. I shall confine my remarks simply to two aspects of the Government’s various developmental proposals - to its road proposals and its railway proposals. Regarding roads, I remind honorable members of the statement which the Prime Minister made last February. This statement, which was not confined to roads but which concerned the Government’s plan for general development, followed discussions which had taken place between the various States and consideration of proposals which had been put forward by the States for various developmental works.

Realizing that it was necessary to determine some form of priorities, the Prime Minister made a statement on priorities for the development of Australia generally. The first priority that he stated referred to the “beef roads for the northern and northwestern areas of Queensland and -for the Northern Territory. I shall .not go into the other priorities because 4 propose to deal particularly with Queensland. .Following the statement by the Prime Minister, an agir.eetne.rit ‘was reached witta Queensland that the Commonwealth Government would provide in this (financial year £650,^00 towards the development of beef roads. There was a sneer earlier to-night about a hand-out <of £650,000. That left me cold. It was a cheap sneer. The sum of £650,000 was to be matched by an expenditure from the Queensland Government of £350,000 to provide for a beef link from Julia Creek to Normanton.

In addition, it was announced at that stage, that, as part of this beef road development, £350,000 would be provided within this year’s Budget for the Northern Territory to enable linking roads to be built from the Western Australian border through to the Queensland road system and also down to the South Australian road system. Following that, Queensland asked whether it could anticipate the grant of £650,000 in this financial year - remember., the statement was made last February - so that it could go ahead immediately with this proposal. That, of course, was readily conceded by the Commonwealth Government and the actual work on these roads started months before the Budget was produced. That was simply the start of this long-range programme.

I find that there was an important point in the Treasurer’s Budget speech which apparently has missed the attention of many people and, J am .afraid, of some State governments. Referring to the £650,000 plus the provision for the Northern Territory which I have mentioned, the Treasurer said -

The provision of £1,000,000 is by no means, however, the limit of the expenditure we have in view in this field. Subject to agreement being reached with the Governments of Queensland and Western Australia, we are willing and, indeed we intend,, io provide additional funds .for roads in these two States in the near future.

Any one who has any conception of government will realize that that statement applied to this financial year and to the Budget for 1961-62. It is not some sort of vague suggestion for three or four years ahead. It meant that we were prepared to consider proposals from the States concerned .for .further advances in this financial year. Western Australia immediately took action as a result of which agreement was reached that a further £500,000 would be made .available to that .State for specified roads in the Kimberleys - I shall mot name them now - -“which would create a farther fink .across ‘the north of Australia for beef transport. Thai was readily agreed to. Western -Australia is matching that £500,000 by payments out of its own finances for further beef roads for the Kimberleys.

Unfortunately, to the great regret of some of my colleagues, there was no firm proposal whatever at the /government .level for further road assistance for the Queensland Government during 1961-62. This -led recently -to considerable press controversy. I must speak ‘plainly .on this matter ‘because I believe that I have an obligation to .my fellow Queensland members to .do so. It appeared that certain ‘things were being dome for Western Australia but not for Queensland. We were determined to do the best thing for the development mot just of Queensland tout of the whole of northern Australia. The best thing was for a ‘conference to be -arranged. By whom do honorable members (think it was arranged? It was arranged by members of the Federal Parliament. The conference which ‘took place last Thursday evening was the result of action taken by my friend, the Minister for Primary Industry (Mr. Adermann), ‘by .my friend, the Minister for Trade (Mr. McEwen), who is Leader of the Australian Country Party, and also ‘by the whole of the Cabinet after the suggestion had been put to it. That is how the conference came about.

At that conference, the representatives of ;this Government said: “ This matter needs frank and free discussion round the table. That is the way these things are resolved. They are not resolved by irresponsible press controversy.” The result of the ‘conference was extremely satisfactory. When we got to talking round the table like sensible men, each imbued with the idea of doing what was best in the interests of Queensland and Australia, it became apparent that the main problem for Queensland was that, although it could match our £650,000 with an allocation of £350,000. it was in difficulty in matching any further grants that we might make in the current financial year. We made it quite clear that the statement originally made by the Prime Minister in February was sincere and that we would do all that we possibly could to further the development of northern Australia, and particularly to expand the production of beef, which is so essential to the early development of our export markets. So, after discussion, we made an offer. There was no force about it. We offered, as an alternative proposal, £5,000,000, to be provided over a five-year period for the purpose of developing beef roads in Queensland.

I want the terms of that offer to be understood. The £650,000 already granted will come out of the £5,000,000, and the Queensland Government will still provide £350,000 to match the £650,000 granted by the Commonwealth. That had already been agreed upon. But the Queensland Government is not required to make any matching allocation in respect of the remaining £4,350,000. That offer, Mr. Chairman, completely conforms with the spirit of the statement made by the Prime Minister in February about our determination to proceed with these developmental programmes. It is not something new. It is completely in accord with the proposals enunciated in February and with the statement made by the Treasurer. At this point, I pause for a moment to point out that this agreement could have been achieved much earlier had there been discussion instead of press controversy. Nevertheless, I pass over that and say that immediately the offer was made it was gratefully accepted.

I have not unlimited time, and, having made that point about roads, I pass on to railway proposals. This is a difficult matter. I point out that there are two kinds of railway proposals. One is based on the old policy of standardizing the gauge of railways between capital cities. The other is of newer vintage, and that relates to the development of rail systems - not necessarily of standard gauge - for commercial purposes. This represents development that will pay for itself out of the increased earnings of the railways. The Government, of course, has had to determine definite policies for both of these kinds of railway development. I shall deal briefly with standardization first. We have a number of examples. The first is the railway from Kyogle in New South Wales to Brisbane in Queensland. It has been said rather loosely, “ The Federal Government contributed nothing to the KyogleBrisbane railway”. The Queensland yearbook for 1959 states that, of a Queensland capital component of about £2,200,000, the Federal Government paid roughly £1,600,000 and the Queensland Government some £600,000.

The next example of standardization proposals is the railway from Melbourne to Albury, in respect of which the general policy determined by the Government for the standardizing of the gauge of railways between capital cities has been carried out. The terms vary a little according to conditions, but, first of all, the Federal Government provides the whole of the capital and the State Government takes over the repayment of 30 per cent. No sinking fund component is included. A similar situation arises with the standardization element of the Western Australian rail link. These principles have been applied generally throughout. Most people who criticize what is being done do not know the basis on which the Government carries out these policies, but that basis is sound.

I now turn to the commercial aspects of railway development. This is where the line to Mount Isa comes into the picture. The proposals for that line represent a purely commercial proposition. There is no standardization component at all. The Western Australian link, however, is partly a commercial proposition. The portion of the Western Australian link which comes under the heading of commercial development is subject to terms - which have been agreed to by the Western Australian Government - exactly the same as those for the Mount Isa proposal. That fact was made plain to the Western Australian Government when discussions took place.

In brief, the principle respecting commercial railway development is that the total capital expenditure on a commercial proposition can be recovered from the added earnings of the railways concerned. I remind honorable members that the original Mount Isa railway proposal put up by the Queensland Government was that the capital expenditure involved be fully amortized over a period of twenty years out of the added earnings of the line. That was the basis on which the proposal was put up, not by the Federal Government, hut by the Queensland Government.

Mr Pearce:

– On the advice of its experts.


– On the advice of its expert advisers, Ford Bacon and Davis Incorporated. We know that that information is correct. So does the Queensland Government. Unfortunately, the proposal by the Queensland Government that the necessary funds be obtained from the International Bank for Reconstruction and Development fell through. So the Commonwealth came in and said: “ We will take over the role of the International Bank. We will advance the money on the terms suggested, with one qualification: We will not require from the Queensland Government a signed agreement by Mount Isa Mines Limited to pay certain freight rates which will amortize the expenditure. We know that it can be done, and therefore we shall not require such an agreement.” The original proposal fell through over the requiring of an agreement of that kind. The Federal Government’s proposal was accepted gratefully by the Queensland Government. As a matter of fact, the terms in which that Government’s acceptance was notified were rather extravagant.

Mr Pearce:

– How long ago was that proposal accepted?


– Two years ago. A slight adjustment with respect to interest rates was made in favour of Queensland. For the last two years, the money has been available to Queensland for the work on the Mount Isa railway. Then a further proposal came forward after we thought that everything was right. That proposal was that the Commonwealth accept liability for sinking fund commitments in respect of the amount owing by the Queensland Government. I have not time to go into this in great detail, but any one with a business mind will realize that acceptance of that proposal by the Commonwealth would have been completely foolish. We were to take the place of the International Bank, and this proposal was the equivalent of the Queensland Government saying to that bank: “ Lend us £20,000,000 and give us, also, a certain percentage of that to enable us to repay what we borrow “. As a result of this proposal, there have been no drawings in the last two years against the £20,000,000 that we have been prepared to advance.. Certain works on the line have been undertaken by the Queensland Government and financed out of funds which could have been used for other purposes.

I do not know why the whole matter was not clearly understood previously, but we have cause for great satisfaction in the fact that, when the position was thoroughly explained, and it was made abundantly clear that in all these proposals for both roads and railways there was no discrimination in favour of Western Australia to the detriment of Queensland, our Queensland friends agreed to sign an agreement for the undertaking of the Mount lsa project on the basis of the proposal made about two years ago. It is a great satisfaction to us that, after all this, those funds are now available. This will free other funds, and so, we hope, will result in a much more effective co-operation between us. Let us hope that this will lead to something better.

The sincerity of this Government can be gauged by the fact that although there was no agreement signed until now the necessary financial provision was made against the making of such an agreement. There was no reference in the Budget papers to an amount of £4,600,000 in respect of the Mount Isa project. Such a reference could not be included in the Budget papers because the matter had not been finalized. Nevertheless, the Treasurer had, if I may use the term, salted the money away. He had made provision in the Treasury account for an advance of £4,600,000 to Queensland in this financial year in respect of the Mount Isa project, thereby anticipating the making of an agreement. So there is the proof of the Government’s sincerity in this matter. How unfortunate it is that there should be this interstate rivalry, this criticism that some State is getting more than another State is getting. I could tell honorable members all the facts in this particular year about what Queensland is getting in the way of Commonwealth grants apart from moneys authorized under the Loan Council programme, and advances under the Financial Agreement and so on. Let me mention, first, the fact that the provision of £650,000 in respect of the Normanton-Julia Creek road, with the £4,600,000 in respect of the

Mount Isa project, raises the amount granted to Queensland for special purposes to £5,250,000. That will be plus any further amount which the Queensland Government can show us will be spent on the special road provisions in that State. Suppose such other expenditure comes to £500,000. That will mean that Queensland will have £5,750,000 for these specific purposes in this financial year.

We have been criticized in respect of the provision to be made in regard to the railway in Western Australia. Under the Western Australia Grant (Northern Development) Act, Western Australia will receive £1,800,000 this year. In addition, there is the provision already mentioned for £500,000 for beef road projects and this year the amount for the rail survey will be about £150,000, making a total provision of £2,450,000 for Western Australia for those purposes as against £6,250,000 for Queensland. I am giving those figures, but I think that such comparisons are most undesirable. Those who make them are short-sighted, because this Government is pursuing a long-range policy, the basis of which is the proper development of Australia as a whole. It is wrong to pinpoint expenditure in any one year in any one State. Our policy for the development of Australia as a whole must be somewhat elastic, because conditions vary between States and between proposals. For instance, although the policy is basic, it must be elastic in regard to the various kinds of rail projects, which are either developmental or aimed at standardization. The Government’s policy has been framed with no thought of giving an advantage to any particular State. The basis of the policy is the maximum advantage to Australia as a whole.

The CHAIRMAN (Mr Lucock:

– Order! The Minister’s time has expired.


.- We have just listened to the first Australian Country Parry Minister who has spoken in this debate on the Budget, and that at a very late stage in the debate. We have also listened to a very worried Queenslander endeavouring to make a case for his colleagues in this House, for use in the. coming general election. He made it pretty clear that there was considerable need to defend bis fellow Queenslanders in this matter. He was trying to make out that Queensland has not been discriminated against in the treatment meted out to it by the Commonwealth. It was only too apparent from the beginning to the end of what he had to say that Queensland had been continuously discriminated against by this Government.

The Minister said that he was very pleased with the fact that the Government has provided £650,000 for the building of beef roads from Julia Creek to Normanton. £650,000! The Minister has not told us how many miles of road this amount will build. In terms of sealed road at a cost of about £30,000 a mile the Commonwealth Government has therefore provided money for about 22 miles of road. Who is going to provide the money for the rest? The State concerned is providing money for about eleven miles. So it is no wonder that members of the Australian Country Party had a little conclave somewhere and said, “Let us go out and put pressure on the Government because if we do not do something we will be likely to lose our seats “. The Minister did not have too much to say about Liberal Party members; only about Australian Country Party members. His friend the Minister for Primary Industry (Mr. Adermann), and his friend the very strong Minister for Trade (Mr. McEwen) were the ones who did this.

Let us look at the terms and conditions of the Mount Isa railway loan which are vastly different from those made by the Government in the other case. The Minister endeavoured to explain this difference in terms by saying that in one case a standardization project was involved, whilst in the other - the Mount Isa case - a commercial proposition was involved. It is only too apparent, if one thinks outside the jargon and the slogans with which people try to explain away difficulties, that a railway line which is a part of a system of standardization has a greater capacity to amortize its cost than has a line out into the bush, such as the one being built to Mount Isa. Yet this line into the bush is being compelled to carry a greater cost than most lines in Australia, which have a far greater capacity to amortize their cost.

The Commonwealth Government, as we all know, originally approached the International Bank for money for the Mount Isa line, but the International Bank would not lend the money, so the Commonwealth h?.d to come in in its place. Why go to the International Bank in the first place, and why try to justify the Government’s extremely harsh and discriminatory terms against Queensland by saying that these would be the terms that the International Bank would have laid down? Let us look at the attitude of other governments in such matters. The Chifley Government made grants for roads into the Channel country, but this Government allowed the scheme to come to an end. Nothing was done about it from 1949 until recently. In relation to ports, which are of great importance in this country, the Chifley Government provided, under the Stevedoring Industry Act, that grants would be made to re-equip the ports in Queensland. This Government repealed that section of the act in 1956, and no further action was taken on it. Not one public work had been initiated in Queensland by this Government during its term of office, and Queensland is the only State to which that applies. The Chifley Government proposed to establish a Burdekin authority similar to the Snowy Mountains authority. But what has this Government done about developing the Burdekin? So whichever way it is looked at, the case made by the Postmaster-General (Mr. Davidson) failed to prove that this Government has not discriminated considerably against Queensland.

Let us take the fundamental question before us. The federal Budget is the most powerful instrument of economic policy in the nation. It is not confined to a mere £650;000. It can determine whether we have schools or service stations, houses or hotels-, pensions or profits, hospitals or office buildings, streets or television sets, or in which combination we have these things. Above all, the federal Budget can determine whether or not there is to be unemployment, whether we have adequate money for our needs or whether money is to be restricted’. This latter alternative does not concern only the unemployed - the 113,000 that some people in Australia do not care much about - but it decides whether those who have jobs will keep them, whether wages- and salaries will fall, whether shopkeepers will have plenty of customers, whether farmers will sell their wool, wheat and other products. All those things are involved in what the federal Budget can do. This matter of unemployment and tight money does not affect only the unemployed; it affects every one except those who have a great deal of money already. At present, whether we have unemployment and a retarded economy or whether we have full employment and an expanding economy depends upon the Commonwealth Government and the economic policy that is reflected in the Budget.

I want, to try to sum up in a few minutes the case that has been made by the Opposition in this Budget debate. The first point that we have made is that the year 1960-61 is a turning point in the economic policy of the Liberal-Australian Country Party Government. Since 1949, the policy of the Government has been to accept and support a level of effective demand which would maintain full employment and inflation. Whilst the level of unemployment has fluctuated during the term of office of the Government from about 9,000 to 82,000, and the price increase at the same time, it is well to remember, has fluctuated from 3 per cent, a year to as high as 24 per cent, a year, the Government has always erred on the side of inflation and has been ready fairly quickly to aid a recovery from a lower level of employment.

This policy has at the same time caused a serious distortion in the economy in which resources and money have moved up to the affluent end of the scale and away from the poorer people and from public requirements. Whilst this, has occurred, the policy of full employment and inflation has been successful in giving Australia its most rapid rate of economic development, and it has been the strongest reason for maintaining this Government in office for twelve years. But 1960-61 is the turning point in this vastly important matter of economic policy. This year provides adequate evidence that the Government has abandoned the policy of full employment. There is ample evidence that the Government is willing to accept not only the unemployment of 100,000 people and more - many of them, of course, in Queensland - but it fs prepared to accept a depressed economy and a retarded1 rate of economic development. If people vote for this Government, they are voting for unemployment and a retarded rate of economic development.

If 1 am able to make myself heard above the shouting of the honorable member for Lilley (Mr. Wight), let me say that the main purpose in this Budget debate should be to decide whether these propositions are true and what can be done about them. The Leader of the Opposition submitted that the Government’s change of policy became apparent in the way the inflation of 1960 was so much exaggerated. It is not that we did not have inflation in that year; there certainly was inflation, but there has been inflation in every year that this Government has been in office. However, the Government set out to blow up the inflation of 1960 into an economic apparition. With prices rising at less than 4 per cent, in that year compared with 24 per cent, in another year, the Minister for Trade sought to call that period a period during which the Australian economy was on the razor’s edge. But, in 1950-51, when retail prices rose by 15 per cent., and when the wool-growers were experiencing their great boom in 1951-52, when retail prices rose by 24 per cent., and in 1952-53, when they rose by 10 per cent., we were not on the razor’s edge. Those booms were not exaggerated into the economic apparition that the Government tried to make of the 1960 boom. So, the Leader of the Opposition was quite right in raising the question. Why did the Government exaggerate the inflation of 1960 into a dangerous boom? The answer was not because it was concerned with internal conditions, which it had accepted year after year during the whole term of its office, but because it was concerned with the balance-of-payments problem.

Mr Reynolds:

– That was a self-inflicted wound.


– That is so. In February, 1960, for mistaken anti-inflation reasons, import controls had been removed. The anti-inflation policy at the time seems to have been the result of the Government’s coming under the influence of what we might call the gilt-edged rentier class, whether inside the public service or out of it, who seemed to mistake the Australian economy for a superannuation fund. Having come under the influence of these people, the Government decided, for doctrinaire and dogmatic reasons, to remove import controls in the belief that this would be an answer to inflation. But, of course, the removal of import controls did one thing; it brought down the overseas funds to a dangerous level and above all established the fear that there was a large volume of imports that had not been currently paid for. The Government had failed in its antiinflation expectations, because at the end of the year, after having removed import controls in the hope and belief that this would relieve inflation, the Government, according to the Minister for Trade, found itself on the razor’s edge of an economic crisis.

However, the Government’s manoeuvre had brought down overseas funds to a dangerously low level and it felt that they would fall further as a result of having to pay for imports that had not been paid for currently. It is worthwhile noticing at this stage that there does not appear to have been any vast volume of unpaid imports, because overseas funds this year have not suffered any considerable reduction apparently as a result of this. However, facing at the end of 1960 the possible crisis in overseas commitments, the Government had two possible courses of action before it. It could have restored import controls and it could have used selective measures to regulate the economy where it needed regulating and reinforcing, or it could have adopted the course that it did adopt and that is the general credit squeeze. In the words of the honorable member for Mackellar (Mr. Wentworth), this was a method of burning down the house to obtain roast pig.

In an effort to regulate a section of the economy, the Government used the method which affected every section of the economy. It cut housing by 25 per cent, or 30 per cent., and it cut every aspect of the economy, whether in fact the Government wanted to do this or not. Further, it created unemployment for 113,400 people. In this situation, and still anticipating a further drain on overseas funds, the Government took a second step. It went to the International Monetary Fund to borrow sufficient to cover the expected drain, and, most important of all, it submitted to the International Monetary Fund a memorandum, as it called it, of policies and intentions. We were going to the pawnbrokers, so we had to prove we were pure. We were going to marry the girl, so we had to prove that our record was impeccable. We went to the International

Monetary Fund with a memorandum of policies and intentions. The Australian Government was giving an undertaking to an international body about the policy it would follow in Australia so that it could obtain a loan to fill the gap in the situation created by its own action. It gave four undertakings. The first was -

In the field of fiscal policy the Government intends to make every effort to keep the growth of government expenditure under restraint.

It could not adequately increase social services or provide adequate money for development in Queensland or for education, having given that undertaking. The second undertaking was -

Seasonal needs apart, however, the monetary authorities intend to keep a firm control over the liquidity position of the banks, with a view to limiting during the year ending June 1962-

Not 1961, but 1962- the amount of outstanding bank advances to a total that would be consistent with the maintenance of financial stability.

In the third undertaking the Government repeated its previous statements that it would not re-impose import controls, and in the fourth undertaking the Government pointed out that it had already been to the Arbitration Commission to oppose a wage increase and implied that it would do so again. In consideration of these undertakings, we find that the International Monetary Fund said -

In consideration of the policies and intentions set forth in the Memorandum attached to the annexed letter, the International Monetary Fund agrees to a stand-by arrangement for the support of those policies and intentions.

In effect, the fund said, “ As long as you agree to be conservative, and as long as you apply a restrictive policy at home, we will lend you money, and if you get into difficulties, we will lend you more money “. The Government, therefore, is committed - at least it is under a strong moral obligation - to a restrictive economic policy. This is not to mention the difficulty of applying a second time to the International Monetary Fund. The nature of the Government’s policy is clear and it becomes more clear as a result of the undertaking that has been given to the International Monetary Fund. It is a policy of deflation and retarded economic development. What is more, it is an accepted policy. The Prime Minister (Mr.

Menzies) made this quite clear at his recent press conference when he said -

I am not looking for anything exciting about this upturn expressed in terms of employment. I think the position will go along quietly.

So the right honorable gentleman thinks that we will continue to have retarded economic development and unemployment. If any honorable members want some verification of that statement they should look at the Budget papers, because the anticipated revenue for 1961-62 shown in the Budget involves revenue which can come only from a retarded economy and from an economy from which unemployment is not removed. One has only to look at the figures in relation to excise duties paid on goods produced in Australia. In 1960-61, excise collections totalled £257,000,000. The anticipated collections in 1961-62 are given as £265,000,000, an increase of less than 3 per cent. Sales tax imposed on goods sold in Australia in 1960-61 amounted to £173,000,000. After allowing for reduced rates of tax the Government expects to collect £172,000,000 in 1961-62. In payroll tax, the Government collected £61,300,000 in 1960-61, and at the same rate of taxation it expects to collect £61,500,000 in 1961-62. Again, the figures are almost the same. If the Government expects to collect, at the same rate of tax, about the same amount of revenue from the pay-roll tax, it assumes that the aggregate pay roll is going to stay about the same. If it assumes that the aggregate pay roll is going to stay the same, it expects the aggregate of employment to stay the same. What is going to happen?

Mr Turnbull:

– What about overtime?


– There is no room for overtime. What will happen to the 113,000 unemployed and the 50,000 more people who will join the work force this year? Of course, there will be nothing exciting in the upturn. Of course, the position “will go along quietly “, as the Prime Minister has said. Of course, the Government has become a government of retarded economic development. Of course, it has given up its objective of full employment. That is precisely the situation the Government has undertaken with the International Monetary Fund as one that will prevail in Australia. The year, 1960-61, quite clearly is a turning point in Australian economic policy. The Government has finally given up full employment with inflation, and .has accepted unemployment as a permanent feature of the Australian economy.

What are the facts of this deflated and retarded economy? The honorable member for Melbourne Ports (Mr. Crean) told the story very vividly. He pointed out that although 130,000 persons had joined the work force in 1960-61, there were 27,000 fewer in employment on 30th June, 1961, than on 30th June, 1960. This suggests unemployment at the rate of 157,000; but those registered for unemployment, under a system which does not register by any means all who are unemployed, numbered 1 1 3,400. Surveys by the Associated Chambers of Manufactures have shown that about 3 per cent, of those employed in manufacturing industries are working on short time.

The honorable member for Melbourne Ports also pointed out that gross private investment increased by £187,000,000 in 1959-60 but by only £68,000,000 in 1960- 61. If the Government is not concerned about low employment, it should be concerned about low private investment. The decline last year was nearly to one-third of the previous year’s level. When we look at the effects on consumers, we find that persona] consumption increased by £415,000,000 in 1959-60 but by only £259,000,000 in 1 960-6 1 . If you divide personal consumption into its component parts, you find that consumption of food has risen by about 7 per cent, in the aggregate, but food prices have risen by 7 per cent., and the number of people eating that food has increased by about 2 per cent. So there has been no improvement in the standard of food consumption. Consumption of clothing and home durables is much the same. The only place where there was not a retarded level in the past twelve months was in imports. They rose during the year by £167,000,000 while at the same time stocks of goods unsold! rose by £165,000,000. Undoubtedly there has been an increase in imports through the relaxation and removal of controls which has put Australian industry out of operation and has taken a considerable part of its market. In addition from imports there has been a vast accumulation of stocks.

The question that the Australian community has to answer is: Do we accept a permanent level of unemployment in Australia exceeding 100,000? Do we accept a retarded level of private industry and a restricted level of private consumption in Australia? Basically, this becomes the question of the 1930’s all over again. Are we to return to the pre-war, conservative doctrine, brought to us by Sir Otto Niemeyer and now re-asserted by .the International Monetary Fund, of retarding our national goals of full employment, immigration, rapid national development and production to the limits set by unregulated external trade? Are we to pay allegiance to overseas investors in New York, Washington and London and allow them to dictate the conditions under which the Australian economy will develop, or are we to pay attention to the needs and potential of Australia’s industries and concerns? That is the question before the Australian people to-day. The retardation of the Australian economy and the limitation of development to fit what is within the limits of unregulated foreign trade is the decision the Government has made. Are we to limit our internal development to the pace set by unregulated external trade? The limits set in external trade are not so much set by exports as they are by imports, as the Deputy Leader of the Opposition (Mr. Whitlam) has pointed out. It is not so much a matter that these problems and crises arise because we cannot export enough to pay for what we want: the crises have come because of the marked fluctuation of imports. That has happened on each occasion. That was the problem in 1951-52 and again this year. Imports into Australia have fluctuated a great deal more than exports have fluctuated.

In the years just before import controls were introduced, imports fluctuated between £510,000,000 in 1949-50 and £1,050,000,000 in 1951-52- over 100 per cent. Exports have not fluctuated by more than 60 per cent, throughout the term of office of this Government. It is the fluctuation of imports that has forced a crisis on the Australian economy with which the Government has wrestled throughout its term of office. The lesson to be learned is that imports have to be stabilized if Australian economic development is to be stabilized or even maintained. Import controls are not needed now for this reason, but they are essential if full employment is to be maintained in the long run. While the question of what determines the level of Australian development - unregulated external trade or Australian potential - is vital, that question is not one that limits economic policy in Australia at present. Australia is not at present in a condition where our rate of development is limited by pressure on overseas funds. The Government admits this, indeed, it takes pride in claiming that Australia’s overseas reserves are in a healthy condition, even when overseas transactions are unregulated. The Prime Minister has told us that our international reserves are in a condition of “ unbounding health “.

Expansion in Australia is not, therefore, limited at present by our international reserves. It is not limited by shortage of resources in Australia. There is unemployment, short time work and unused capacity, and there are unsold stocks. There is no limit, either from external conditions or internal conditions, on the development of Australia. Why, then, preach caution? Why advocate stability, which is only another name for stagnation? Why warn of the dangers of inflation when as a government you have been living with it for ten years? Why have you suddenly become so concerned about the dangers of inflation that you have imposed a retarding and restricting policy on the country?

For many years increased expenditure has been needed in Australia in particular directions. The basic defect of the Menzies Administration has been its failure to authorize sufficient expenditure for the poorer people and for certain public works and services, such as education, health and roads. But the urgent case on economic grounds, and the urgent plea on humanitarian grounds, has been resisted, with the argument that to give way to it would be to cause more inflation. So child endowment increases have been refused so that profits could be free; pensions have been adjusted to only a miserable extent so that hire purchase could remain unregulated; education has been starved of adequate funds so that foreign capital could find unlimited scope in Australia.

But these measures are no longer necessary. The Government need not restrict child endowment and pensions. It need not cut down on financial provision for education. It need not restrict expenditure on necessary public works, designed to alleviate unemployment, because of any problem of inflation. This is no- longer necessary. Even if we accept the distorted priorities that the Government has applied’ since it has been in office, there is no need to abandon child endowment increases; there is no need to hand out only a few shillings every second year to pensioners; there is no need to retard progress in education. These policies can be changed because no danger of inflation is involved in changing them. In 1 958, the then Treasurer, Sir Arthur Fadden, in a situation that was not nearly so deflationaryas the present situation, said -

This year the Government is budgeting, for an overall cash deficiency of £110,000,000. That is to say, we expect that the total receipts of Commonwealth revenue, public borrowings and other usual sources will fall short of our total expenditure by £110,000,000 and we plan to finance that gap by borrowing from the central bank.

If it was necessary in 1958, when there were only 63,000 unemployed, to borrow from the central bank in order to cover a deficit in the Budget, it is all the more necessary in 1961. I challenge the Treasurer (Mr. Harold Holt), who is to follow me in this debate, to say why it is that, although in 1958 it was possible for the Government to budget for a deficit of £110,000,000, it is not possible for the Government to do so to-day.

The Labour Party has put forward a clear policy. It believes that increased expenditure is needed in Australia to-day to ease unemployment and provide justice for those who have been without it for so long. Expenditure must be increased so that the 113,000 people out of employment can be re-employed, so that the unemployment benefit and other social service payments may be increased, so that finance may be provided for education and for the building of more houses, and so that indirect taxation may be reduced.

Labour will submit a supplementary budget to expand the economy, and not to contract it, as the present Government did in 1951 and 1956 after being re-elected. Our policy of expansion will increase the gross national product, get rid of unemployment, remove excess capacity and clear unsold stocks and thereby pay for itself.

Labour will not be deterred by fear of this reactionary, conservative, restrictive policy and frame of mind that has afflicted the Menzies Government after ten years of almost unregulated and uncontrolled inflation. After having lived as the parent of inflation for ten years the fear of its illegitimate child is driving the Government to adopt the most restrictive policy that this country has seen for twenty years.


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

HigginsTreasurer · LP

Mr. Chairman-

Mr Clark:

– I raise a point of order, Mr. Chairman. Is the Treasurer in order in speaking at this stage? Standing Order No. 64 says -

No Member may speak twice to a Question before the House, except in explanation or reply.

Standing Order No. 68 says, further -

In all cases the reply of the Mover of the original Question closes the debate.


– Under Standing Order No. 92, the Treasurer, being the Minister in charge of the financial measure before the Parliament, has the right to speak for periods not specified.


- Mr. Chairman, the honorable member for Yarra (Mr. Cairns) said, as he rose to his feet this evening, that he would be summing up for the Opposition. If he was accredited for that purpose it is not without some significance, perhaps, that the left wing of the left wing of the Australian Labour Party has been selected to make the final case for what is undoubtedly the most frenzied and radical alternative Budget that has been presented to this Parliament in my lifetime. The honorable member claimed to be summing up for the Labour Party. Let me try to summarize the position, as we see it on the Government side.

An observer of these proceedings during recent weeks could have been excused if he had come to the conclusion that the gentlemen on your left, Mr. Chairman, came from a different country from the gentlemen on your right. It would appear obvious to such an observer that they have been talking about a very different country from the country that we have been talking about. At the very least it could be said that they are viewing the matter through quite differently tinted spectacles. It will be for the Australian people, if they will take the time to analyse what has been put forward from both sides of this committee, to determine which side has given the correct diagnosis of the Australian situation.

We are about to vote to-night on an amendment put forward by the Leader of the Opposition (Mr. Calwell). He said, in moving that the first item be reduced by £1, that he was adopting the traditional form of censuring the Government on the Budget. From what we know of the honorable gentleman the word “ traditional “ could almost have been changed to “ habitual “, because his concept of the role of an Opposition is to oppose most vehemently whatever comes before this Parliament from the Government, and to see no merit at all in any aspect of the Government’s economic programme. Our appeal is made not to honorable gentlemen opposite who hold these biased views, but to the Australian people as a whole.

Mr Cairns:

– Including Mr. Knox?


– Order! The honorable member for Yarra has already made his speech.


– I refrained from interjecting when the honorable member was making his speech. If he would like to interject while I am speaking I would ask him to move away from the table, so that we may all be a little more comfortable. I do not want to remind honorable members opposite of the painful fact that under the Standing Orders I have unlimited time in which to speak. I do not wish to avail myself of that opportunity, but I ask, as the spokesman for the Government in introducing this Budget, to be allowed to deal with what is virtually a motion of censure from the Opposition arising from the presentation of the Budget.

It is not surprising that we should hear criticism of a budget. No budget is immune from criticism, because so many people look at the financial elements from differing viewpoints. We brought in a budget which was designed to provide a certain stimulus to the economy, supplemented by associated measures which I will discuss in more detail later. Our object was to provide a very positive and substantial stimulus. As the Budget details became known, the criticis offered their views. There were spokesmen for farmers, who, being naturally very much concerned with cost levels in this country, said they did not think there should have been a deficit at all. There were spokesmen for manufacturers and some for retailers, who were looking for a sharp stimulus, or a shot in the arm, to be provided by the Budget. They said, “ This deficit does not go nearly far enough “. Outdistancing the field was the Leader of the Opposition, who produced an all-time record deficit as his answer to the needs of the nation. He said that we could have a deficit of £100,000,000 in a budget to be introduced by Labour in February. When the Prime Minister (Mr. Menzies), in a devastating analysis, pointed out that, in effect, this would be a deficit at the rate of £250,000,000 a year, some of my colleagues thought that the expression of the Leader of the Opposition was one of stunned horror at the realization of what he had perpetrated. They believed in their innocence that no one could be so foolish as to propose a deficit of that dimension. Indeed, some of the supporters of the Leader of the Opposition subsequently have sought to gloss over what they too regarded as an inadvertent error on his part.

An analysis of Labour’s proposals shows clearly that a deficit of £250,000,000 is implicit in them. The Leader of the Opposition has announced already for his party that it proposes an increase of £100,000,000 in social services. He has told us that he proposes an expenditure of £60,000,000 on the north of Australia. The Deputy Leader of the Opposition (Mr. Whitlam) has told us that Labour will spend 1 per cent., or preferably 2 per cent., of the national income on aid to under-developed countries. I point out that 1 per cent, of the national income amounts to £60,000,000. The Leader of the Opposition stated that he would slash sales tax collections by £50,000,000. I do not need to go through the score of other items that were mentioned in his Budget speech and since, but by adding them together you soon reach a total which makes a deficit of £250,000,000 in a full year look like chicken feed. This is the Opposition’s plan to meet the economic circumstances of this country!

The Opposition claimed that it could find no merit in our Budget. To make an attack upon our proposals it first had to establish its own base. Whether that base was realistic or not is for the people of Australia to determine. But let us have a look at the elements of that base - the two fundamental propositions put forward by the Leader of the Opposition. His first proposition was that there was no boom in 1960. Indeed, not once but several times in the course of his speech, to give emphasis to his own view, he referred to it as “ a mythical boom “. In the eyes of the Labour Party, as expressed by its leader in this House, what happened in 1960 was not a boom. If we choose to call it a boom then it was a mythical boom with no reality in the eyes of the Opposition. I do not quite know what would be a boom in the eyes of the Opposition, but here are some of the major items which in our judgment constituted a boom in 1960: There was a spectacular rise amounting to about £138,000,000 in bank advances; there was a record upward movement in hire-purchase outstandings from £400,000,000 to £450,000,000 in the year; record sums were raised from the public by means of debentures and notes; speculation in land and shares, as every one knows, was rife; there was a feverish air about the speculation; demand was excessive in a variety of directions and, in the September quarter of last year, our overseas reserves ran down by over £90,000,000. Then there was the story of the building industry. In Victoria alone eight vacancies were recorded for each employee in the industry. And what was the state of the motor car industry? In the last year of Labour’s term of office registrations totalled 125,000 but last year’s production was running at the rate of 1,000 new vehicles a day and there were over 300,000 registrations. Those are some of the elements-


– Order! If the honorable member for East Sydney (Mr. Ward) and the honorable member for Yarra (Mr. Cairns) desire to conduct a conversation I suggest that they go outside this chamber. There are certain things over which the Chair has no specific authority under the Standing Orders, but there is authority under the rules of common decency and courtesy. I remind honorable members of that fact. The Treasurer may continue.


– I hope I have said enough to show that even if members of the Opposition regard-


– Order! The honorable member for Newcastle is interjecting. I name the honorable member.

Mr Jones:

Mr. Chairman, if I may I should like to tender an apology for my interjection.


– The Chair accepts the apology of the honorable member for Newcastle. I call the right honorable the Treasurer.


– Before this unfortunate interruption I was stating that the Opposition’s idea of a mythical boom does not coincide with the analysis that has been made on this side of the chamber, and I have mentioned the facts which I believe support our judgment.

The second major element in the Opposition’s charge that our diagnosis was faulty is its claim that the situation in Australia at present is one of depression. Well, Mr. Chairman, some of us in this place have experienced depression years. We can recall the time when, with a Labour government in office, unemployment amounted to about 30 per cent, of the working population. We can recall vividly the grim distress which was occurring in Australia at that time. For any responsible leader of a political party in the National Parliament to describe the situation in Australia to-day as one of depression holds him up as a laughing stock to all sensible people. It is a very strange kind of depression which produced .some interesting results. For instance, in this “ depression-ridden “ Australia we purchased, in the first six months of 1961, some £121,000,000 worth of beer compared with £117,000,000 worth in the corresponding six months of 1960. We smoked £79,600,000 worth of tobacco and cigarettes as compared with £78,600,000 worth in the boom year of 1960. As my harassed colleague, the Postmaster-General (Mr. Davidson), knows, in this depressionridden country there are just on 70,000 people imploring him to install telephones for them. It is a very strange kind of depression that we are having. I know there is some unemployment; and we have debated that subject during the course of this Budget discussion. We on the Government side of the chamber have told of measures which will improve the overall employment situation; and I will mention some of them in a little more detail in a few moments. But even in these times just on 20 per cent, of the Australian workers are working overtime in what is described by honorable gentlemen opposite as a period of depression. I have acknowledged that the economy was in need of some degree of stimulus, and the real test is whether we have done what was sufficient in the circumstances.

I said a little earlier that there had been critics, but they were not all hostile critics. I know the Leader of the Opposition has a high regard and respect for the editorial views of the Melbourne “ Age “. On the morning after the Budget was delivered that journal commenced its editorial by saying “ The Federal Budget is just what the doctor ordered “.

Mr Curtin:

– What the doctor ordered?


– The honorable member for Kingsford-Smith (Mr. Curtin) could avail himself of the services of one with great advantage - even one in a specialized category. The Melbourne “ Age “ said the Budget was just what the doctor ordered, although it went on to say, “ Not everybody will relish the prescription”. Another objective comment which received remarkably little public acknowledgment in some of the journals which were most critical of the Government’s Budget, but a detached and authoritative comment in the London “ Financial Times “ said that the Australian Budget should give a fairly strong expansionary stimulus to the economy. It was kind enough to say that we had shown courage in refusing to make vote-winning concessions, and it went on to point out the kind of stimulus which would be given.

Is the stimulus adequate for our needs? I have already said that there is the stimulus of a budget deficit. But there have been major developments since the Budget, all of them in contemplation and, I think, without exception, referred to by me in the course of my Budget speech as being part of the Government’s programme. Reference has already been made to some of them by my colleague the Postmaster-General, but since the introduction of the Budget we have concluded arrangements, regarding railways and the vast steel project to come into effect in Western Australia, with the Government of that State, involving an expenditure of more than £40,000,000 on railway construction and rolling-stock and more than £45,000,000 in the steel industry which is to form the major part of the project. That, in itself, is a vast contribution to the development of this country. It is the most important industry project ever negotiated for Western Australia, as well as one of the greatest industry undertakings commenced in the Commonwealth for many years. It may be said, “ Well, all this does not happen for a long time “; but the results or ramifications have their effect in some directions almost immediately because industry in that State and, indeed, industrialists in the other States, knowing of this project going forward, and of other projects to which I will refer, then put their own plans in hand in order to meet the opportunities opened up in this way.

We have offered to provide the Government of South Australia with funds for the purchase of locomotives and ore wagons for operation on the Port-Pirie-Cockburn line. In Queensland, as my colleague the PostmasterGeneral has rightly emphasized, we have finalized arrangements for the Mount Isa-Collinsville railway, with a view to increasing export income from the fabulous Mount Isa mine. That will add £4,600,000 to the Budget this year, thereby increasing in prospect the deficit from some £16,000,000 to over £20,000,000 for the year. In both Queensland and Western Australia we have concluded discussions for the construction of additional beef roads in the course of this year. We have concluded arrangements satisfactory to the Government of New South Wales for improvements to coal ports at Newcastle, Port Kembla and Balmain. That, again, will not only provide many additional employment opportunities but will also add usefully to our export income in the years ahead.

In the Budget speech I referred to the offer on the part of the Commonwealth to increase, by agreement with the States, the total authorization for local and semigovernmental borrowings by £5,000,000. Since that time all the States have agreed to this proposal, so those additional loan raisings can be given effect. The Chairman of the Commonwealth Banking Corporation recently stated that the Commonwealth Savings Bank had made further increases in its rate of lending for housing purposes. This again follows the announcement in my Budget speech, in which I said that a further special allocation of funds by the bank would be made over and above its normal provisions. These are all substantial additional achievements which have occurred since the Budget speech was delivered, not coming along as some surprise development, but planned and discussed with a view to forming part of the programme for this year in this country. Taken together with the expansionary effect of converting a budget surplus of over £15,000,000 last year into a deficit this year of what now appears to be over £20,000,000 all these major developmental projects constitute a very substantial contribution to the progress and development of this country and good prospects of increasing employment opportunities in the months ahead.

Let me turn now to one or two other criticisms made by honorable gentlemen opposite. As recently as yesterday the Leader of the Opposition - and much has been made of this element during the Opposition’s attack - in the course of his Budget debate referred to the question of Australia’s external position. I would have thought that honorable gentlemen opposite would have kept clear of that one, because the Government has a quite remarkable story to tell on this matter as the result of the action which we took from November onwards. On the external front there has been literally a transformation in our trading position. With the elimination of excess demands and a cessation of speculative overseas ordering we knew that imports would be bound to fall steeply from the inflated levels of the first half of 1960-61; and they have in fact done so. In each month since May we have had an overseas trading surplus. In May, our exports were worth £93,300,000 and our imports £78,900,000. In June, exports were worth £97,600,000 and imports £74,600,000. In July, our exports were worth £86,200,000 and our imports £69.700,000; whilst in August, exports were worth £77,800,000 and import? £72,900,000. So that over those four months alone there has been a visible surplus on our trading account of £58,800,000. It must be remembered that the July-August figures come in a quarter of the year which is normally the slacker period of the year for export income. It was in that quarter last year that we saw a run down of more than £90,000,000 in our overseas reserves.

Mr Ward:

– I rise to order. The Treasurer is now making his second speech on the Budget. I refer you, Sir, to Standing Order No. 86, which refers to tedious repetition. The Treasurer is now repeating all the arguments that he used in his initial speech.


– Order! There is no substance in the point raised by the honorable member.


– Even though, in the eyes of the Melbourne “ Age “, this Budget is just what the doctor ordered, it is very unpalatable medicine to honorable members opposite. The figures that I have just given have been given to honorable members, 1 think, for the first time. Certainly the August figures were only published to-night. Since the introduction of the Budget there has been an improvement in the price of wool. Looking ahead, there is every prospect of a good season for wheat and there are reasonable prospects of good marketing for our wheat this year. This rapid improvement in the trading position has greatly reduced our balance of payments deficit on current account and, as net transactions on capital account have continued to be favorable, with capital flowing in steadily, our international reserves have been rising.

I come now to a passage to which I am sorry the honorable member for Yarra (Mr. Cairns) is not here to listen. He became very disturbed about our standby arrangement with the International Monetary Fund, and I thought I might bring some comfort to his tortured soul with what I am now going to put before the committee. In March, when we took the decision to seek a drawing and standby credit from the International Monetary Fund, our reserves had fallen to about £370,000,000. To-day, they stand at rather more than £570,000,000. The fund drawing accounts for only £78,000,000 of this increase, so that, quite apart from assistance from the fund, our reserves have risen by some £120,000,000 since March. We know that Australia is a country which needs a high level of reserves because of the wide and unpredictable swings to which our balance of payments is subject because of fluctuations in the prices and the volume of our primary products. But, given the present strength of the reserves and the great improvement in our underlying trade position, it is now clear that we shall not need to make use of the twelve-month standby credit of £45,000,000 which we arranged with the International Monetary Fund last April. I have accordingly despatched a cable to-day to the managing director of the fund requesting that the standby be cancelled with immediate effect. Although in the event we have not found it necessary to make further drawings from the fund, the standby nevertheless served a most useful purpose. It demonstrated to the world the confidence of the fund in the fundamental soundness of the Australian economic outlook, and indicated for all to see the willingness of that influential institution to put further substantial resources at the call of the Australian Government if they should be needed. The knowledge that such solid backing from the fund was available undoubtedly did much to steady confidence and to put an end to speculative overseas ordering.

Those are some of the elements which I put before the committee by way of reply. I say by way of answer to honorable members opposite that they may take their view of the Australian economy, but there is not an objective observer who can come to this country from any part of the world and survey in a detached way the overall economic situation in Australia, and conditions as they exist to-day, without concluding that, by and large, over the whole field, this country is still in a state of solid prosperity. We want to improve on that. We want to see that idle resources, even if they are small by the standards of other countries, are given effective usefulness. I have outlined the measures which, in this Budget and with supplementary action, will, in our judgment, produce those results.

Sir, I am quite certain that when the people of Australia are able to assess fully the details of what has been put before them by this Government, they will agree with the verdict of the Melbourne “ Age “ that this Budget, and the measures that go with it, are just what the doctor ordered for Australia. Last year, we had a patient which was suffering from an attack of overindulgence. The patient is now doing fine, thanks to the medicine administered, and is well on the way to full recovery.


.- We have witnessed to-night an amazing performance by Government Ministers. First, to boost the very worried Queensland members, the Postmaster-General (Mr. Davidson) took us on an election tour of Queensland. Then, for the second time in history, a Federal Treasurer returned to the fray of a budget debate after having opened it some weeks before. The Treasurer (Mr. Harold Holt) did that last year. No other Treasurer would have thought of it. In fact, it was rather dangerous, because rarely does his statement of one week tally with that of another week. There seem to be two reasons for this return performance - first, the obvious recognition by the Government of the feelings of the Australian people, and secondly, the battering the Budget has received in this debate. The return performance is amazing, too, when we remember that the Deputy Prime Minister and Minister for Trade (Mr. McEwen) has not spoken, and will not speak, in this debate.

A review of the current economic situation reveals an unpleasant picture of unemployment, of unused industrial capacity and of confusion and uncertainty. The chief budgetary aim should naturally have been to promote stability and to cure the ills apparent in the economy. In delivering his Budget speech, the Treasurer admitted this aim. But words are not deeds, and it is difficult to see how the measures taken can quickly restore the balance and order urgently needed.

Let us look at the situation. The result of a survey made by the Victorian Chamber of Manufactures up to the end of the financial year paints the picture quite clearly. Information taken over a variety of industries - 73 in all - and many hundreds of employers shows a startling picture of the piling up of stocks, rapidly falling orders. depressed production and reduction in employment. The average loss of employment shown was 14.6 per cent., with the average individual loss of wages £1 9s. 6d. a week, based on 1960 levels. The findings, taken at random from the survey, show, for instance, that in the chemical industry the loss of employment was 12 per cent, and th: average loss of wages £4 3s. a week. In the electro-plating industry the loss of employment was 23.3 per cent, and the average loss of wages 19s. lid. a week. In iron foundries the loss of employment was 12.8 per cent, and the average loss of wages £3 9s. 4d. a week. The textile and clothing industries have been two of the chief victims. Employment in the manufacture of footwear has declined by 8.3 per cent., in the manufacture of men’s and boys’ wear by 10.8 per cent., in the manufacture of knitted wear by 30.3 per cent., in whitework by 16.2 per cent., in cotton spinning and weaving by 11.9 per cent., and in woollen and worsted weaving and spinning by 13.1 per cent. The situation has not improved since that time and, clearly, our manufacturing industries have suffered greatly as the result of the Menzies Government’s economic measures.

Another vital sector of our economy is the building industry with its various ancillary industries. Looking back, the Minister for National Development (Senator Spooner), in the course of a statement, said -

If we had not done something about the boom in building a bust would have come.

That statement, considered in the light of statistics recently available, is ironic indeed. For the bust did come and at the hands of the self-styled benefactors, the Liberal Government.

The July figures of the Commonwealth Statistician revealed a sharp down-turn in approvals for new homes and flats and the number of homes under construction this year will reach the lowest level for thirteen years. The unemployed cannot build or buy homes. The part-time workers cannot build them. Those still employed, with the uncertainty of what will happen next hanging over them, are disinclined to risk losing all. Conflicting statements about economic trends from Government Ministers do little to indicate any solidity or planning from which prospective home builders might gain confidence. Those conflicting statements vary from, rosy pictures of- a wonderful year ahead in 1962 to sobering statements, of a slow* recovery such as were made in the press conference given by the Prime Minister (Mr. Menzies) a week or so ago.

Perhaps the Bank of New South Wales was more realistic in its “ Quarterly Review ‘”, released last week, when it said -

Although the rate of business decline has slackened, as yet, positive evidence of improvementis not obvious.

So, in the eyes of the Bank of New South Wales, the situation is static. With that in mind, it is obvious that more dynamic Government action than that provided in the Budget is needed to obtain the solution to our economic problems.

The Treasurer (Mr. Harold Holt) has been prone to use the term “ the turn of events “ when discussing economic trends over the last twelve months. He uses the term in some abstract way as though to infer that supernatural forces have conspired to create our economic difficulties. Nothing, however, can absolve the Government from blame for the chaos it has caused in industry. It gave the green light to the great financial institutions to make hay while the sun shone. Then, belatedly, with a heavy hand it implanted the credit squeeze on big and small alike and the little fellow paid the penalty for the giant’s excesses. Indeed, by words and actions, since the November economic restrictions, the Government and its Ministers, in varied ways, have admitted their errors.

The sudden withdrawal of the 10 per cent, additional sales tax on motor cars; the Government’s expressed concern for the state of the building industry; the reduction of sales tax on some durable consumer goods in this Budget to stimulate demand; and statements by Ministers admitting that the number of unemployed exceeded the number that they would have wished were admissions of miscalculation, of muddled thinking and of the incapacity to govern when the easy times, the good seasons with good prices, were ending and the need for a planning and not a drifting government became essential. On Tuesday night last the Minister for Labour and National Service (Mr. McMahon) said -

No nation can be prosperous unless it has a favourable balance of payments.

No one questions that statement’. But an examination of the figures for the past eight years shows that in only two. of’ those years have we reached a balance. So in the light of the Minister’s statement, we can come to only one conclusion- -that the prosperity so. glibly talked about by the Government over the years has been falsely based’.

With England’s announced intention to negotiate entry into the European Economic Community/ - the European Common Market-and its possible disastrous, effect, on our export income, which already in the. last eight years, is showing an accumulated, deficit qf £ 1,257,000,000s an examination of the cost, of shipping our export commodi-ties is urgently needed. We are one of the world’s great trading nations. We are isolated, in shipping terms, and depend solely on overseas shipping companies to operate what are. virtually our lifelines to the rest of the world. In terms qf national security this is unwise. In terms of national economics, it is disastrous. In 1958-59, freights and. insurance cost Australia. £167,Q00,000. In 1959-6.0, they cost. £185,000,000 and in. 1960-61 they cost £208,000,000 - a. tremendous drain on our national resources which has contributed, to. our continual failure to. maintain a balance in our international payments. To continue to rely on capital inflow and borrowings to counterbalance this loss will, in view of the implication of the United Kingdom and the Common Market, be foolish indeed. Therefore, we must explore means of reducing this sector of what we might term our “ national overhead “.

Unquestionably, too, the high freight rates charged by overseas shipping lines are a great deterrent to the further development of Australian export markets. For instance, the British exporters with various cargo classifications are, in many instances, charged lower freight rates than those which Australian exporters have to pay for only half the hauling distance. Japanese exporters, too, pay rates that are far less than those which Australian exporters have to pay for equivalent distances. Unquestionably, the overseas shipping lines get together to exploit our primary producers and exporters, for we have no means of providing effective competition. Eight or nine shipping lines operate to Asian ports where we hold hopes for vital new markets.

Only half of them are “ conference lines “ as we gall them, yet all offer the same general cargo rate of £12 9s. per cubic ton to Singapore. Where is the competition there? There is none, of course. It con»stitutes collusion on the part of the shipowners to defraud the Australian exporters.

How long can we continue to be at the mercy of overseas interests? If the Government genuinely desired to explore every avenue to increase export earnings and to lower our shipping costs it would smash the shipping monopoly on our all-important export trade. Millions of tons of snipping are tied up in the world’s ports unused and idle, an ideal situation for the creation of competition. But none is evident. We can create competition by building and operating our own shipping line. Why can we not put our shipyards and their workmen, threatened with unemployment, to work on modern freight carriers like the one to be built in Brisbane? At Cockatoo, at Williamstown and at other places we could lay the foundation for a modern cargo-carrying line which would, in a few years, conserve millions of pounds of our annua! freight bill. Sooner or later an Australian shipping line, private or government, will be a reality. The time is ripe for action now.

Mr. Temporary Chairman, there seems to be in Government circles some satisfaction that the rate of imports has dropped to about £900,000,000 annually. But, before the final abandonment of the idea of import controls in the minds of Government members, I want to emphasize four points: First, there is yet an incalculable cost of imports purchased on terms, to be paid for as a result of importers’ efforts to dodge the credit squeeze.. Secondly, this diminished inflow qf goods, has been brought about by an artificially depressed internal economy, When normal trading returns, imports must surely increase substantially. Thirdly, there are still Australian industries, struggling for survival because of competition from overseas countries where, living and working conditions are far lower than. ours. Fourthly, there is the need to conserve our overseas financial resources for the financial stresses which will surely come if Britain fails to achieve concessions for Commonwealth countries in her negotiations to join the Common Market.

It seems inevitable that Britain will join the Common Market community of nations. The benefits of the Common Market are surely apparent when the remarkable economic expansion and development of Britain’s continental competitors, who are members, is considered. France, West Germany, Italy and the others are making the pace too hot for Britain and she must make the choice- -join them and prosper or become a fourth-rate power of the future. In the interests of her own economic salvation, she must join. I believe that we have neither the moral nor the legal right to dissuade her. Whether, in joining, she will gain concessions for Australia and other British Commonwealth countries is the vital question. That she will try is not questioned. But France, with the power of veto, has already indicated her unqualified opposition to this. Considering the question realistically, it must be agreed that if the basic principles of the Common Market are to be retained it is unlikely that there will be a place for Britain as a conditional member.

The employment and living standards of all Australians are at stake. Approximately £180,000,000 worth of our exports of primary products could be in jeopardy. In addition, the continued economic expansion within the European Common Market zone will attract an increasingly greater weight of British investment, resulting in a correspondingly diminishing rate of capital inflow into this country. Probably with the exception of wool, the Common Market countries already produce great quantities of products which we export to Britain. Those countries will naturally aim at expanded production in order to satisfy Britain’s needs, and, with a tariff disadvantage, we could lose our vital market for wheat, fruit, butter and other products. Not only our primary producers, but the whole community, will be affected. The: United States of America, with no Commonwealth preferences to hurdle, could take our market for canned fruits and other products. So the story could go on. In truth, we could face economic disaster.

In my view, it would be foolhardy to wait until negotiations are completed and we are confronted with the prospect of a disastrous drop in trade. Accordingly, Mr. Temporary Chairman, I believe that we must redouble our efforts to obtain alternative markets and to increase our trade with other parts of the world. Australia, like any individual who can foresee the prospect of diminished income, must plan ahead. We can help to meet the crisis by conserving our overseas balances now. We can do this by preventing the importation of goods which are already manufactured in adequate volume in Australia, and, by so doing, save the money for our essential needs in the future.

There are some, Mr. Temporary Chairman, who, because of political differences, would not trade with Communist China. 1 refer them to a speech made by Douglas Hyde, the former top-ranking Communist, who toured Australia recently. I quote him very briefly. He said -

The Communists’ best opportunity is a recession.

Unquestionably, if a collapse of our export trade brings about a further recession, internal communism will gain its greatest impetus since the depression of the 1930’s. Trade does not imply agreement with another country’s political philosophy. So, if Communist China has the capacity to pay, we would be foolish to refrain from trading, especially if our own solvency depended on it. While we are endeavouring to find alternative markets for our primary products, we must not lose sight of the fact that, in addition to an increase in the index figure for the cost of imports, the sharp decline in export prices over recent years has played a great part in reducing our national income. The Government’s failure to counter the spiral of rising costs has allowed the cost of production figures for all primary products to rocket to the highest level in history, and we now find many small primary producers squeezed between high production costs on the one hand and lower prices on the other, with little left to maintain the standard of living that their labours deserve.

Considering wool, which is our major export commodity, I believe that the wool-marketing situation is unique. We sell our most important primary product on an open market without asking a price. Surely there is no other product in the world in respect of which the demand equals the supply - for we sell all of our wool - yet it is sold for prices which have tumbled alarmingly in recent years. If the supply exceeded the demand we would not need an economist to tell us why prices had fallen. But no argument can convince me now that we have received in recent years the maximum prices which could have been obtained. Clearly, in my view, the answer is a reserve floor price auction system. I believe that such a system, allied with an increased promotional drive, would give our wool-growers and the nation great benefit.

With our traditional markets in Europe fading - for, even without the possible inroads of Britain’s entry into the European Common Market, the trend has been away from Europe - we must look to Asia and the Americas. The demand for our goods - the need for our goods - is there. India, Indonesia, China and South America all are potential customers, with only one drawback - lack of capacity to pay. Three years ago, the Export Development Council recommended that a credit corporation be established to finance trade with Asian nations. The need for such a corporation is more urgent now than then, for other great trading nations have already recognized the need, and their capacity to finance trade places us at an extreme disadvantage. Accordingly, I urge the Government to provide the finance - for it is doubtful whether private sources could do so - and to establish such a corporation. We have had a windfall in sales of wheat to Communist China this year, but only a super-optimist would regard such sales as a permanent feature. Next year, we may sell none of our wheat to that country. Other Asian nations need wheat, and if we can offer them terms, obviously we stand a better chance of clinching sales.

Again I say, Mr. Temporary Chairman, that, unquestionably, when considering other aspects of our trade, we must come to the conclusion that inflation has priced us out of many world markets. Again, the responsibility lies at the door of the Menzies Government When it took office, it had one announced aim - to counter inflation. Primary producer exporters, as well as manufacturers and wage-earners, will testify to its failure.

Mr. Temporary Chairman, it is my belief that, in a civilized community, the young should look after the old, the well look after the sick and the strong look after the weak. We can ask ourselves this question: Have we, as a civilized community, sufficiently provided for our aged, our infirm and our unemployed? Although this Budget for 1961-62 provides for increased payments to age and invalid pensioners and to the unfortunate members of our community on whose toes the Prime Minister chose to tread - the unemployed - the payments are still a matter of national shame. Would any honorable member pretend that he could live on the basic age pension of £5 5s. a week? Could he feed and clothe himself, pay rent and municipal and water and sewerage rates and provide firewood to warm himself on an income of £5 5s. a week? Of course he could not. Neither can tens of thousands of pensioners who struggle to exist in conditions of poverty that reflect shame on the Government. We are told repeatedly by Government supporters that we are a prosperous nation - that our economy is stable. If that is so, surely our pensioners on the basic rate of pension are entitled to a better share of our prosperity.

The inadequacy of the unemployment benefit has been the subject of a deputation to the Government by representatives of all the major Christian Churches in Victoria in recent weeks. And rightly so. For they know, as all honorable members must know, the utter impossibility of a man, his wife and two, three, four or more children living on £7 a week. The Government’s first responsibility is to provide employment for the family bread-winners. If it fails, as it has done, it should surely accept the responsibility for maintaining the breadwinners and their families in reasonable circumstances until jobs can be created. Clearly, the Government is reluctant to fulfil its humanitarian obligations to the nation. Does the Government imagine that an additional 10s. a week - and that would still be miserly - for pensioners, or a lift in the unemployment benefit to the level of the basic wage, for the unemployed, would build up inflationary pressures? The additional income would be spent on the necessaries of life and not on luxury consumer goods. If food, clothing and firewood were luxuries, the Government’s policy would be right, but it stands condemned for its failure to provide the underprivileged people of this nation with a chance to live, and not merely to exist.

Mr. Temporary Chairman, we find the Government, after having made the annual allocations to State and local government authorities, urging them to spend up in the first half of the financial year - to initiate crash programmes of public works in order to provide additional employment, and to draw more than their usual monthly allocations for this purpose. No mention is made of the second half of the financial year - that will be after the elections - when the allocations will have shrunk accordingly. There is no promise of additional funds and, indeed, there could be quite a crash programme - with a different emphasis on the word “ crash “ - when the funds run out in 1962.

I mentioned earlier the blow which the textile and clothing industries have suffered as a result of the combination of the credit squeeze and the relaxation of import controls. The great tragedy associated with their decline is the disastrous effect on country communities. Countless country towns and provincial cities are economically dependent upon textile factories. Competing against their city competitors who have so many economic factors in their favour, many firms have, through efficient management and loyalty of labour, established themselves as essential units in the economic life of their respective country towns. They gave the word “ decentralization “ some meaning. I believe that some recognition of their part in country life should have been given before the decision was made to let loose the flood of imported textiles into this country. They should have been protected. In normal times employment in country towns is never adequate enough to provide sufficient opportunities for our youngsters leaving school. In normal times employment is never plentiful for adults. Nowadays, with the shadow of the Menzies Government’s economic policies darkening their lives, country youngsters and their elders who have lost their jobs join in the drift to the cities because opportunities for employment in the country are non-existent.

Country factories like John Brown Industries, Hanro Limited, Castlemaine Woollen Mills, Economic Manufacturing Company, Bradford, and countless others, operate with greatly depleted staffs, and with many employees working only part time. Others at Daylesford, Gisborne, Woodend and other places, have closed their doors and as a result family life has been disrupted and homes broken up. Country communities deserve and expect a better deal. They demand protection by import controls for their industries so that once again country people can enjoy life in the town of their choice. I ask the Government to recognize these special circumstances which apply to country textile factories and to take some action to assist in their rehabilitation. I ask in particular that orders for the defence forces and other governmental requirements be placed with country firms and that a special survey be undertaken to determine what other aid may be given to assist their recovery.

For many years now, local government authorities, industrial expansion committees, and other country organizations have been striving to attract industry to their country communities. Assistance from governments has been negligible and accordingly, their success has been extremely limited. To-day, because of the failure of governments to recognize their needs, these organizations fight not to gain more industry but to hold what they have. I believe that in the interests of security and in the interests of the social welfare of country families, the Commonwealth Government should play a part in achieving a more effective decentralization of population and industry. I suggest that a decentralization department be formed within the Commonwealth Development Bank with a view to assisting country industries to be set up or to expand. Further, I suggest that company and pay-roll tax concessions be given to industries outside of a 50-mile radius of the capital cities. In addition, I believe that the Commonwealth should confer with the States in an endeavour to reach an agreement whereby in conjunction they might arrange freight concessions for country industries which labour under a disadvantage against their capital city competitors. As I have said in this place before, country people demand action and not words, and adequate action can come only from the top - the Commonwealth Parliament.

In Bendigo we have one of the largest decentralized industries in the Common wealth - or rather, it could be, but it has one great drawback. It is governmentowned - owned by a Liberal government which has lost no opportunity to sell other government industries, and which reluctantly keeps this industry barely alive. I refer to the Bendigo ordnance factory. Its potential is tremendous. Plant and machinery unmatched anywhere else in the Commonwealth present opportunities for the expansion of its activities far beyond the present level. But last Friday nineteen men were dismissed with more to follow next month. This, in a time when the men have only one alternative - the unemployment benefit! But, Mr. Temporary Chairman, I believe in a fair approach to all things. Consequently, I want to say this: The Minister for Supply (Mr. Hulme) has made every endeavour to avert the crisis, but he operates the factory under a charter which prevents any opportunity for stability or expansion. He is shackled by the Government’s policy of virtually no competition with private enterprise. As a result quite often the factory obtains orders which are the left-overs from private industry.

The factory’s importance in the economic life of Bendigo is tremendous. Hundreds of families depend on it for their livelihood. Its machines and equipment have produced marine diesel engines, guns, ships’ gearing, gun mountings and heavy equipment of all descriptions. It could, with other naval shipbuilding centres, build the minesweepers, for instance, which are now on order overseas. To let the factory fade away would be a tragedy, and I ask the Prime Minister to honour his Bendigo byelection pledge and at least maintain the present level of employment there. A Labour government would do more than that, but then we are not private enterprise purists. In conclusion, Mr. Temporary Chairman, I say that our economic difficulties are recognized and admitted by all sections of the people. Everybody expected a vigorous approach to their solution, but everybody has been disappointed. The Budget has been labelled a “ stay-put budget “ - an adjective which, I am sure, will not be applied by the Australian people to the present Government at the next general election.

Mr Whitlam:

– I desire to make a personal explanation, Mr. Temporary Chairman.


– -Order! Does: the honorable gentleman claim to have been misrepresented?

Mr Whitlam:

– Yes. Earlier this evening the Treasurer misrepresented me. He asserted that I had advocated that Australia should pay 1 per cent, or 2 per cent., of its national income towards helping under-developed countries, and he made a calculation of how many pounds would be involved in such a contribution. Sir, I frequently urge that Australia and other Western countries should, make 1 per cent, of their national income available, through international agencies, to under-developed countries. I have never said that Australia, unilaterally and voluntarily, should make a larger amount available when no other countries have made larger amounts available. I regret the repetition of a misrepresentation which I corrected in the Budget debate a year ago.


.- It seems strange to me, after listening to this debate on the Budget right from the start, that Opposition speakers have not referred to what I consider to be one of the most important items covered in the Budget, especially at this stage of our history. I refer to defence. Ever since I have been here Labour has always taken defence as one of its main subjects during the Budget debate and Labour speakers have always said that the Government should not allocate so much money for defence. They have always wanted to whittle the allocation down. On this occasion, however, honorable members opposite have been strangely silent on the subject. It is, of course, most important at this stage of history that we have the strongest possible defences. Of course, the Government has provided adequately for our defence in this Budget. At present, with Russia displaying an absolute disregard for world opinion and world peace we, with other countries all round the free world, have to be ready for any eventuality. But the only reference that I have heard made to the Berlin crisis recently by an honorable member opposite was made by the member for East Sydney (Mr. Ward) and I do not think that it was in good taste. Here, according to “ Hansard “ at page 321, is what the honorable member for East Sydney said, on 21st August, 1961 -

The Russians themselves, who. suffered, the heaviest, casualties- of any nation engaged in the last war, having lost 20,000,000 people, will begin to fear the great strength that will be given to this new political unit in Europe -

He was speaking of the European Common Market, which might be extended into a political unit, and he was speaking of the troops gathering in West Berlin. He went on to say -

In 1954, when Germany was admitted to thi Nato organization, certain undertakings were given by the West Germany authorities. They agreed that they would arm only for the purpos of internal security.

I ask, Mr. Chairman, what anybody thinks they are arming for? Surely they are arming for internal security and for world security because, after all, the fret nations have shown that they do not wan war? They want peace, but in order to have peace it is necessary to prepare for war. There is not the slightest doubt that at present, with their explosion of two atomic bombs, the Russians are trying to make people fearful of what might happen so that they may be able to make a better deal in Berlin. I wonder what the honorable member for East Sydney really meant by his remarks. Did he mean that the Western nations should not arm and be ready? Did he mean that the Western nations should leave themselves open to attack by the Communist countries, with their concentrations of thousands upon thousands of troops? Listening to his speech and reading it in “ Hansard “ one would think that that is what he meant. But surely there are no citizens in Australia who would really mean this I I give the honorable member for East Sydney the benefit of the doubt.

At present, one of our great aims should be to protect ourselves, but we have heard nothing of this from the Opposition. We must aim for this protection if we want to continue in peaceful occupancy of this great country of our?, lt does not matter how good the Budget is, how prosperous we are or how good the rain was that fell in the Mallee at the week-end; if we cannot keep the Communists out of the free world, all is lost. This is the most important subject for discussion in this chamber.

We have just heard a speech from the honorable member for Bendigo (Mr. Beaton). He is a new member and we esteem him for his sincerity and for the goodwill he extends to all members. Though I appreciate his qualities, I cannot agree with all his opinions. He said it was a foregone conclusion that the United Kingdom would join the Common Market. I am not so sure about that. But he went on to say that if the United Kingdom did not join the Common Market, it would very soon be a fourth-class nation. The United Kingdom is not a nation in isolation, lt is a part of the Commonwealth of Nations, which in itself is a strong body of nations which have proved their worth in peace and war throughout the years they have been linked together. Long have they been associated in peace, and may the ruthless hand of discord never tear them asunder.

The honorable member said further that we have reciprocal agreements with the United Kingdom for preferential tariff treatment for all kinds of goods, including the dried fruits industry that I represent, that my colleagues of the Opposition always mention. (Quorum formed.) It is very doubtful whether more members have been present in the chamber at any time during the day, except question time, than were present when the quorum was called. It is easy to see which members the Australian Labour Party fears and which speeches it seeks to stop. 1 am able to reveal, not only to honorable members but to the general public, what is happening amongst Opposition members. When 1 was so rudely interrupted, I was referring to the speech of the honorable member for Bendigo. He said that certain preferential tariff arrangements that we have with the United Kingdom may be lost forever if the United Kingdom joins the Common Market. That may be, but the important point is that this is not a one way traffic. We do not simply sell to the United Kingdom; we also buy extensively from the United Kingdom. In fact, we buy more than we sell. We also buy a tremendous quantity of goods from Common Market countries. Therefore, if the worst comes to the worst and the United Kingdom joins i he Common Market, a certain amount of reciprocal trade could still be preserved through new agreements with Common Market countries.

But I believe that all this is merely speculation. Some honorable members say that the United Kingdom will certainly join the Common Market and others say that the United Kingdom will join the Common Market only if certain arrangements are made to protect the Commonwealth countries. This is all speculation, but nevertheless we have the promise of the Prime Minister of Great Britain that no definite arrangement will be made until Commonwealth countries are consulted and their opinions considered. We must take full advantage of that promise and already the Government has constituted a committee of four of the most able men in Australia. They are the Prime Minister (Mr. Menzies), the Minister for Trade (Mr. McEwen), the Treasurer (Mr. Harold Holt) and the Minister for Primary Industry (Mr. Adermann).

Primary industries and other industries in Australia are sending information to the members of this committee so that they may put Australia’s case forcefully at discussions on the Common Market. I believe that all we can do at present is to provide all the information we have, to take full advantage of the promise given by the Prime Minister of Great Britain and to put Australia’s case forcefully. I do not think that we should follow the suggestion of the honorable member for Eden-Monaro (Mr. Allan Fraser), to forget we are playing ladies and gentlemen and go in as rough as we can. We can put a case of this kind in the same gentlemanly way as the Government has put other cases in the past, with as much force as is possible for any man of enthusiasm and without following the suggestion of the honorable member for Eden-Monaro.

I should like to comment on the speech of the honorable member for Yarra (Mr. Cairns). He suggested that the International Bank had said that as long as we have a balanced and secure economy, our credit is good. Perhaps the bank did make that comment, but what is the position of any man who has not a balanced and secure economy? After all, individual. make nations. The honorable member went on to say that stability is only another word for stagnation. I cannot understand that assertion. Is instability then only another word for disaster? Any man or nation that cannot stabilize its economy is not able to secure loans privately or collectively as a nation. These statements made by Opposition members completely contradict other statements they have made in the past.

I want now to say a few words about the Budget and to rebut some of the comments made by Opposition members. Much has been said about the Government’s so-called credit squeeze and the removal of import licensing. In my view, secondary industries had been supported a little too much at the expense of primary industries. The irony of the position is that secondary industries have expected primary industries to export and at the same time to buy in the high cost home market of the secondary industries thevery goods and services that make primary production possible. Our secondary industries cannot export owing to costs in their own market. Australian primary producers provide at least 80 per cent. of our exports and they could not continue to do that while the secondary industries were being inflated by living on the future through hire-purchase agreements. So, the Government brought down this legislation.

On many occasions in the past the Leader of the Opposition (Mr. Calwell) has said that he objected to the high profits being made by companies. He has pointed to the stock exchange. He has said, “ Look at the buoyancy of the stock exchange, and how high the prices of shares have risen “. He has pointed out that this reflected the high profits the companies have been making. But speaking in this Budget debate, he said it did not look very well for Australia when there was a weakness in the stock exchange. He said that the very weakness of the stock exchange indicated lower profits. What does the Leader of the Opposition want - high profits and a high call on the stock exchange or lower profits which must be reflected in a weaker stock exchange? When you sit in this place every day, you wonder how quickly people can change their opinions on these vital subjects which affect every man, woman and child in Australia.

I wish to refer to a few statements that have been made by the Leader of the Opposition. Before doing so, I would remark that the hopes of the Labour Party seem to have changed as is shown by the statements of the Leader of the Opposition. They are in “ Hansard “ to read. The honorable gentleman said -

If we are elected at the coining Federal elections . . .

Honorable members should note that the Leader of the Opposition said, “ If we are elected “. This is the man who has been boasting that the Labour Party is certain to occupy the treasury-bench after the next elections. Gradually, the honorable member has become rattled and nervous and has used the word “ if “. Members of the Opposition seem to be inclined to deny that statement, but it is in “ Hansard “ to be read. The young Labour movement in Victoria has come out in the open and is opposed completely to peace conferences and Hiroshima marches such as the march in which the honorable member for Parkes (Mr. Haylen) took part recently in Victoria. It appears to me that there are three lots of Labour supporters. There are those who formed what was said to be “ the great Labour Party “. There is the present Labour movement which is hopeless and desolate. Then, perhaps, there is a young Labour movement coming in and endeavouring to ban Hiroshima marches and the various doubtful movements in which the Labour Party has taken part.

Another bright spot is the action of eighteen trade unions in Sydney in refusing to contribute to levies to pay for Australian unionists to visit Communist countries and for Communists to visit Australia. These developments are great news in a democratic country like ours. Surely the Australian Labour Party will take notice of these events and recognize them as highlights in the history of the Labour movement that will augur well for the future of Australia. We find also that the Leader of the Opposition said in his speech on the Budget-

It is hard to convince the Sydney-Melbourne minded people who dominate this Government of the tragic possibilities of their continued neglect of our empty north.

The Leader of the Opposition represents Melbourne in this Parliament. If he is not Melbourne-minded, who is? He objects to Melbourne-minded people in the Government, yet he is the representative of Melbourne and would be the first to say, “I represent my electorate with zeal “. The honorable member for Parkes apparently does not believe that. Let him go to one of the election meetings addressed by the Leader of the Opposition if he is doubtful. If the Leader of the Opposition criticized Sydney and Melbourne people for concentrating in the cities instead of going out into the country as members of the Australian Country Party have done on many occasions, we could understand his attitude; but the statement he made is incomprehensible. The Leader of the Opposition also said -

We would be prepared to examine the inflationary effect which pay-roll tax is said to have with a view to collecting the £61,000,000 involved in some other way and thus lower costs generally, particularly for the primary producers.

That is one of the best I have heard, because member after member on the Opposition side has said that the Labour Party will re-enact land tax and will put up the tax on incomes of those who, according to Labour, can afford to pay. Among those who can afford to pay, according to the Labour Party, are the primary producers. Surely, any man in Australia with any knowledge of the soil knows that if a primary producer makes a reasonable profit, he puts it back into the land. He improves his holding or his homestead. He builds a better fence or buys better stock, or he sells a rough lot of sheep and establishes a stud. The Labour Party does not understand these things.

If a Labour government did away with the pay-roll tax,, the first thing it would do would be to tax the primary producers for much of the money it was losing by its abolition of that tax. It has been said that the pay-roll tax is not a good tax. I agree with that, of course but I want the people who propose to abolish it to tell me where they will get the £61,000,000 they would lose by abolishing that tax. That is a fair proposition. The honorable member foi: Batman (Mr- Bird) is suggesting that I ask someone else. I am no respecter of persons when the future of Australia is. concerned, and I will ask anybody who can answer me. Where is the money coming from? After all, you cannot pluck it out of the sky. The honorable member for Eden-Monaro (Mr.

Allan Fraser), I hope, is getting ready to answer this question, but he will fail hopelessly.

As the debate continued, we heard some illuminating statements. One of them should be of interest to the honorable member for Parkes because it was made by one of his colleagues from New South Wales. Incidentally, nobody should get the electorate of Parkes mixed up with the town of Parkes because the electorate covers part of metropolitan Sydney. The honorable member for Cunningham (Mr. Kearney) became enthusiastic about the Labour Party and said -

Every difficulty will be remedied under a Labour government. Each problem will be identified and positive legislation will be introduced to eliminate it.

He said, in effect, “ Pinpoint the trouble and legislate against it “. Surely to goodness members of this Parliament and the people of Australia - know that all the money required to finance all sorts of things must be made not by law but by hard work.

Talking about hard work, I am reminded of the words in this debate of a prominent member of the Opposition whose name I will not mention because he is a personal friend of mine and I would not embarrass him. Speaking of unemployment he said, “ I know certain firms that have put off eight out of 25 employees, and they are getting more production”. He said he knew of a firm in Melbourne that was saving itself £100 a week in wages and getting more production. He said that those firms would not put men back to work again. Would it be an economic proposition to do so if the firms are saving £100 a week with fewer men? Would it pay them to put those men back to work simply to slow down the rate of work for each man? Of course not! What this country has to do is to put those unemployed persons who are employable - and quite a number of them are unemployable - back into productive work,, and then pass on to the public the savings that are being made by these firms. We will then be well on the way to controlling any inflationary spiral that might develop.

Reference has been made in this Parliament to the statement by the president of the Australian Woolgrowers and Graziers. Council, Mr. T. M. Scott, in which he said. mat he congratulated the Government for resisting pressure to introduce measures which could result in a resurgence of inflation. In the newspaper that reported his statement, the “ Sydney Morning Herald” of 18th August, 1961, he is reported as having also said: -

Reading the plaintive criticisms of the Budget, one could be pardoned for thinking that we have a socialist economy in which business hangs on the dictates of the Government, rather than one in which the initiative rests with private enterprise.

Naturally when we hear the plaintive callings of members of the Labour Party, we remind ourselves that they are visualizing a socialist government. But one of their party members, not a member of Parliament, Mr. Harold Speed, speaking in Victoria’s Labour Hour, said that it was most fortunate that Labour had not won at any of the recent federal elections, because Labour could not hold inflation as well as the present Prime Minister had done, for the simple reason that Labour could not put into operation its socialist policy in the short time of three years. This means, 1 take it, that Labour’s endeavours to put its socialist policy into operation would cause its defeat at the next election it contested. If I had the time to give you the historic details - and unfortunately I have not, because time goes swiftly by-

Mr Duthie:

– Hear, hear!


– I hear a Labour member cheering; no doubt he is thankful that my time will shortly expire. The longest period that Labour has been in office was eight years and two months during the Second World War period. On another occasion Labour was in power for two years and two months. There were also a few periods of some months each, but of the 60-odd years of the life of this Parliament Labour has been in office for only 17 years. And what about the great disappearing trick? Labour’s socialist policy disappears at election time. After the last election we heard much of it in this place, but I have not heard it mentioned in this debate by Labour spokesmen. Before the last election I told Dr. Evatt that I would humbly apologize if I heard any Labour speaker advocating socialism in the election campaign. I am prepared to offer to do the same on this occasion. Labour’s socialist policy performs the great disappearing trick, and why? For the simple reason that Australian people do not want socialism. They will not have it, whether it is presented as democratic socialism, which is the policy that some honorable members opposite contend is followed by Castro, or whether it is any other kind of socialism. Khrushchev said recently that until now Russia has had socialism, but that it is now going to bound into proper communism, when every man will be on the same level.

As 1 have said before, 1 am completely opposed to socialism, because I believe it is not just a stepping stone to communism; I believe it is the springboard. That is why I say to the Australian people, with all the enthusiasm at my command, “Keep this country free “. Australia has been good enough for people to die for, so let us keep it free.

Let me now consider the question of unemployment. I do not know what Labour members would talk about in this debate if they did not have the unemployment position to speak of. Their main topic has been unemployment. Everybody is in sympathy with people who are unemployed, and I believe that private enterprise, the Government and the people themselves can get together in an endeavour to solve the unemployment problem. I am told on good authority that there are some young men in this country who have never worked.

What does this Government do to help the unemployed? It pays them much more than the Labour Government ever did. After all, honorable members should not forget that no Labour government has ever achieved full employment. There have always been some unemployed persons in the periods of office of Labour governments. But the best that Labour could do to help the unemployed was to pay £2 10s. a week for a man, his wife and one child. Legislation now before this Parliament will provide for a payment of £7 under the same circumstances, which is a good deal more than £2 10s. Yet Labour is finding fault with what this Government is doing. Under the Commonwealth Aid Roads Agreement an amount of £46,000,000 will be provided for the various States this year. Victoria will get more than £9,000,000, which is more than the whole of Australia received under the Commonwealth Aid Roads Act in the time of the Labour Government.

Labour members say, of course, “ Why go back over those matters? We now have a new party with fresh ideas “. They have no hesitation, however, in delving 40 or 50 years into history if they think they can discredit this Government by doing so. They cannot have it both ways. If they put up a fair case for one side they must put up a fair case for the other. The Opposition cannot say, “ We are a new party “, because, after all, the party is controlled by many of the old executive. Some of those who controlled the Labour Party have been in the unions and the executives for generations.

Mr Duthie:

– That is not true.


– It is true. I can give you one or two names. At least I can say that they have been active in the unions and the executives for a considerable time. I suggest that members of the Opposition cannot condemn new members of Parliament for something that was done 30 or 40 years ago. I have been here for fifteen and a half years - I know that some honorable members will say it is too long - and in the great Liberal Party in this Parliament only two members remain of those who were here when I entered the Parliament. They are the Prime Minister and the Treasurer. All the others have come here since then. Of Country Party members there are only four who were here at the time I came. I merely want to show how things change. You get new members but the new members may have the old ideas.


Order! The honorable member’s time has expired.

Mr Allan Fraser:

– We have just heard from the honorable member for Mallee (Mr. Turnbull). I doubt whether the honorable member’s constituents will appreciate his willingness, after a dignified protest, to accept with a gentlemanly bow and a gracious adieu the abolition of the dried fruits preferences in the United Kingdom market. I also doubt very much whether any one will be convinced by the crocodile tears he shed on behalf of the unemployed in the last few minutes of his speech, because, in an earlier part of it, he emphatically endorsed the action of the

Victorian manufacturer who dismissed 100 men from his plant. The honorable member’s approval of that action showed that he was advocating the deliberate creation of a pool of unemployed in this country. We know that many members of the Government parties are in favour of such a pool, but only the honorable member for Mallee would have the folly or the honesty to declare his attitude so plainly.

I would have expected farm incomes to be the first concern of the honorable member in this debate, but, although he dealt with many aspects of the financial and political situation, as a representative of a rural electorate, he left farm incomes severely alone. I shall repair the honorable member’s omission by giving the committee facts and figures regarding farm incomes.

Before I do so, I would like to refer to the extraordinary spectacle we have witnessed to-night of the Treasurer (Mr. Harold Holt) making a second speech on the Budget. No other Treasurer in the history of the Commonwealth, so far as I know, has found it necessary to adopt such a course. What was the reason that motivated him? Was it that he did not trust his colleagues to put the case? Was it the refusal of the Leader of the Country Party, the Minister for Trade (Mr. McEwen), to enter the debate? Was it because he wished to shut out the Country Party Minister for Primary Industry (Mr. Adermann) whose place in the debate had already been arranged? Or was it because he wished, servilely, to win the support and admiration of the directors of the World Bank, who are at present in Australia? Whatever reason brought the Treasurer to his feet a second time, I do not think he enhanced his own reputation or in any way added to the Government’s case. It showed only, I thought, his severe anxiety and worry at the sharpness of the attack and the response which his Budget has received throughout the community.

While the Treasurer was quoting such opinions as he could gather from Victorian admirers I thought I might quote to the committee the opinion of a leading Victorian Liberal, a man well known for his strict and honest adherence to Liberal principles. I refer to Mr. George E. Knox, who is reported in to-day’s Sydney “ Sun “ in this way - “ I have no shadow support behind me. I have been promised election assistance from many men and women members of the Victorian Liberal Party. I might tell Mr. Holt now that a number of Liberals have resigned from the party in disgust because of his economic policies “.

Mr. Knox said he had been an active supporter of the Liberal Party and even helped raise money for Mr. Holt to fight previous election campaigns.

He entered the present fight because he believed he might be able to achieve something - to jolt the Government into an awareness of the damage the Holt policy had caused in Australia.

That is the opinion of a really honest Victorian Liberal, Mr. George £. Knox who, I understand, will put his views to the test by challenging the Treasurer in the forthcoming election. I believe that other endorsed party members in so-called safe Liberal seats will find themselves opposed by unendorsed Liberals and will find themselves challenged on their adherence to the traditional principles of the Liberal Party.

I return now to the subject of farm incomes with which the honorable member for Mallee (Mr. Turnbull) failed so conspicuously to deal.

Mr Turnbull:

– Everything I said had regard to that.

Mr Allan Fraser:

– You never once mentioned the figures.

Mr Turnbull:

– But everything I said had regard to it.

Mr Allan Fraser:

– But you never mentioned the figures, and I understand very well why you did not. In 1949-50, the last year “of the Chifley Government, farm incomes in Australia totalled £426,000,000. In 1960-61 they totalled £467,000,000. On the official basis of the new consumer index £100 in 1960-61 is worth £53 of 1949-50 money, so last year’s farm income of £467,000,000 is equal to £245,000,000 in terms of 1949-50 values.

Mr Barnes:

– What about world prices?

Mr Allan Fraser:

– Do not worry, I shall deal with world prices. As I have said, in terms of 1949-50 values, farm incomes dropped from £426,000,000 in that year to £245,000,000 in the last financial year. That is the exact measure of the loss that has been suffered by the primary producers due to this Government’s acts of commission and omission in creating the unparalleled inflation of internal costs to which the honorable member for Mallee truthfully referred.

Looking at it another way, the gross farm production in Australia in 1960-61 totalled £1,341,000,000. Costs totalled £874,000,000 leaving a net farm income of £467,000,000. Converting the costs into 1949-50 money values, they would be £427,000,000, not £874,000,000 and the net income of the farmers would have been £911,000,000 in 1960-61 and not £467,000,000 were it not for the effects of inflation on primary production. That again is a measure of the actual loss suffered by the primary producers because of the Menzies-McEwen inflation. I point out that the figures I have cited are official figures that I have obtained from the Bureau of Agricultural Economics. The bureau is responsible for the figures, not for the conclusions that I draw from them, but the calculations are made officially.

Mr Anthony:

– Do wage increases have any effect on the matter?

Mr Allan Fraser:

– Of course. Wage increases were necessary as part of the procedure to counter inflation in this country. The primary producer suffered all the time because more than one-half of his exports, as the honorable member for Richmond knows, have to be sold on the world market where prices and conditions in Australia have no effect. Surely the honorable member must realize that. He has not been in this House very long but surely he must realize the position of primary producers in that regard. He should have sympathy for them in their plight, not contempt.

The figures that I have mentioned are based on the publications of the Bureau of Agricultural Economics. It has to be recognized not every factor is measured and, in reply to the interjections that have been made, I agree that account is not taken of the amount of farming investment over the period, nor the changes in productivity.

Mr Murray:

– What about the price of wool?

Mr Allan Fraser:

– Yes, that is taken fully into account. I shall deal with that aspect. Nevertheless, the figures provide a substantially accurate picture of the effect of uncontrolled inflation upon primary production and farm incomes.

Perhaps some honorable members, particularly those of the Country Party, would like this lesson spelled out in more -detail. The figures that I shall now give cannot be challenged because they come direct from the “ Quarterly Review of Agricultural Economics “ published in April, 1961, with preliminary figures up to June, 1961, which since have been made available to me and to others by the bureau. I stress that the June figures are preliminary only, but any correction in them on revision will be of only the slightest nature.

What do the figures show? Let us look first at the ratio of prices received by farmers to prices paid by farmers and see how they have changed during the last eleven or twelve years. The base taken is 100 calculated on the five years ended in June, 1950. On that basis, in December, 1949, the month in which the Chifley Government left office, the ratio was 105 for all farm products. The corresponding figure for December, 1948, was 108. Let us compare that with the present position. In December, 1960, the ratio, instead of being 108, was down to 80, and the corresponding figure for December, 1959, was 82. The figure for March, 1961, was 81 and the preliminary figure for June, 1961, is 80. That is a fall in the ratio. Surely those figures, which have come direct from the Bureau of Agricultural Economics, ought to encourage members of the Country Party to take some action, if not in this Parliament at least in their party room, on behalf of the people who pay them and who expect them to represent their interests in this place.

Mr Turnbull:

– That is why we supported the Government’s action in relation to credit restrictions and the lifting of import controls. Do you not know that?

Mr Allan Fraser:

– If the honorable member for Mallee is still unconvinced, a more graphic way of indicating the position is by assuming that inflation had not taken place and that prices paid by farmers remained at the 1949 level. In that event the ratio of prices received by farmers to prices paid by farmers would now be 164. That is the answer to the honorable member who has mentioned the change in prices of our primary products. If inflation had not occurred the figure would now be 164 .instead of 80.

Let me .return now to the “ Quarterly Review of Agricultural Economics “ and refer to the indexes of prices received .and paid by farmers for various commodities. Taking 100 as the base, in 1949-50 the price of wool was 1’67. In 1959-60 it was 161, so there was a decline. Wheat was 119 and it rose to 136; meat was 131 and it rose to 255; dairy products were 120 .and they rose to 199; all products, ^excluding wool, were 123 and they .rose to 191; all crops were 119 and they rose to J. 5 4, and .all livestock products were 143 and they rose to 195. That is the .measure of the increase in the price of primary products during those eleven or twelve years. Now let us .look at the indexes of prices paid by producers as a result of the inflation in this country. They rose from 117 in 1949-50 to 219 in 1-959-60. The tremendous rise in costs was the burden the farmers had to ‘bear, not -the failure of prices on overseas markets.

Mr Anderson:

– What about State land tax?


– Do not draw that silly red herring across the trail. Just listen and try to understand what I am saying. I am now giving the ratio of prices received to prices paid. In 1949-50 for all farm products the ratio of prices received to prices paid was 115. That was the last year of the Chifley Government; and for the whole of 1959-60 the ratio had dropped to 82. The farmers have therefore suffered very severely indeed -at the hands of this Government. Their heavy loss of real income has affected the well-being of country towns and rural districts throughout the continent. Will any member of the Country Party deny that? Of course not. The figures I have cited prove that this is not due to a decline in prices. Indeed present world prices for most of our primary products would be generally satisfactory were it not for the burden of inflated internal costs.

The injury to the primary producer is the measure of this Government’s failure to control inflation. In palliation it may be said, in excuse for the Government, that this failure has been due toits folly, its apathy, its mismanagement and not due to any deliberateintent to injure the rural community.I accept that excuse on behalf of the Government, but I warn the primary producers of this country, particularly the dairy farmers, thatit isobvious that if this Government is returned to officein December nextit will implement the report of the Dairy Industry Committee of Enquiry which it specialty commissioned, to the detriment of thousands of small farmers in this country andwill return large tracts of arable land to the wretched conditions of the parched areas. Can the Government give any assurance that it will not implement that report? Why is it saving the report up until after the election? Why has it not announced any decision on the report? No dairy farmer worth his salt would take a risk on it.

The CHAIRMAN (Mr. Lucock).Order! I suggest that interjections from the right of the Chair and assistance to the speaker from the left of the Chair should cease.

Mr Allan Fraser:

– I am grateful to you, Mr. Chairman, but I have not the least objection to the friendly interjections 1 have been receiving. I turn now from the farmer to the injury inflicted by this Government on the Australian family. Who can deny it? Here the excuse that the action was not deliberate cannot be pleaded. Ever since 1950 the Government has refused to make any adjustment in the rate of child endowment to meet increased prices. In 1950 it provided 5s. a week for the first child, and in the ensuing ten years since then it has done nothing at all to increase child endowment. At present the Government is withholding from the mothers of Australia something over £70,000,000 a year that is due to them. That is the amount which would be needed to give child endowment payments a semblance of their former value. This action by the Government is one of the most extraordinary in the political history of this country and the most extraordinary thing about it is that no spokesman for the Government has ever yet said one word in justification of its refusal to increase the rate of child endowment payments. I have never seen one member on the Govern ment side rise inhis place to justify the refusal of the Government to increase child endowment payments.

Mr Hulme:

– That is not true.

Mr Allan Fraser:

– Have you?

Mr Hulme:

– Yes.

Mr Allan Fraser:

– The Minister says he has justified the refusal. Then let. him be branded for what he is - a man who believes that child endowment to-day should carry half of what its value was in 1949 and who is. deliberately prepared to inflict that policy on the families of Australia. I am glad to have heard the Minister declare himself on this issue and say he justified the refusal to increase child endowment. He knows that to-day it is not worth half of what it was worth in 1949. He is therefore justifying the reduction of child endowment by half; and there is no other construction that can be placed on his remarks.

Mr Hulme:

– You know the basis upon which the payments were made.

Mr Allan Fraser:

– Nothing that the Minister says will help him now. He has made his position plain enough to his own electors and to the country. This action by the Government is one of the most extraordinary in political history. Of course it cannot possibly be justified. Every other considerable section of the community has received adjustment in payments to correspond with increased prices. The increases have been paid to judges, to Ministers of the Crown, to members of Parliament, to the Public Service, to trade unionists and wage earners generally and they have been paid to the aged, to invalids and other recipients of social services. Indeed, in all these cases the Government has been at pains to show that the increases have been measured and are adequate to meet the increased prices. Yet it has refused to make any increased payment whatever to the mothers of Australia. That is a most extraordinary thing. It appears to me to be a wicked and cruel blow aimed at the most defenceless section of the community. The mothers have no organizatian and no pressure group to assert their rights. The action appears to be one of the utmost cold deliberation, taken in the knowledge that the larger the family the greater the injury that will be caused to it.

If the Government came out plainly, as the Minister for Supply (Mr. Hulme) has done, and said that it does not believe that increased rates of child endowment should be paid, that would be fair enough; but it does not do that. It knows that if it did so it would be annihilated at the polls. Indeed, it professes to believe in the principle of child endowment, but to every reminder of the constantly reducing value of child endownment payments, it turns a blind eye and a deaf ear. Already as the result of the Government’s action child endowment has been more than cut in half. On this matter the speeches of the Treasurer (Mr. Harold Holt) once again are silent and the Budget itself contains no provision whatever. On the evidence, what other conclusion can be reached than that the Government is determined to destroy child endowment as a social service in this country?

I have spoken of the injury to the farmers and to the family done by this Government. With them stand all the recipients of fixed incomes in Australia who have been worst hit by inflation, including those who trustingly invested money in Government bonds. It may be argued that these are the exceptions. The Government certainly claims that the prosperity of the people as a whole has been advanced during its term of office, but the cold statistical facts prove that even this is not so. The ordinary Australian has received no benefit whatever in his personal income during the whole tenure of office of this Government. The plain fact is that considerable sections of the Australian people, as I have shown, are far worse off now than they were in 1945. The average Australian is not even a penny a year better off to-day than he was on the day when this Government took office. The Minister and an honorable member on the Government side have interjected, contesting what I have said, and therefore I propose to prove it by the official figures which are available in the Budget documents, which I have no doubt both the Minister and the honorable member who is interjecting have studied. I have no doubt they will recognize the figures when I give them to the committee.

Indeed, when account is taken of the higher rates of taxation on inflated incomes, average personal incomes in terms of actual purchasing power are lower to-day than when Mr. Chifley handed over the Prime Ministership to the right honorable member for Kooyong. The ordinary Australian family now cannot afford to buy as much or even nearly as much in goods and services as it could then afford to buy. It is one thing to say this but another thing to prove it However, the proof is available. 1 know it would take a lot to convince some honorable members of it, particularly when it is a fact that the average weekly earnings per employed male unit have risen from £9.69 a week in 1949-50 to £22.89 in 1960-61. That, surely, could be taken as a measure of increased prosperity, but these are the figures calculated from the pay-roll tax payments. Even when the £22.89 is converted to its equivalent in purchasing power in 1949, it still is £12.2, which is a considerable advance on the 1949-50 figure of £9.66. Against this must be reckoned the heavily increased taxation which £22 a week attracts as against £9 a week. There must also be taken into account, in estimating family income, the failure of the Government to increase child endowment rates. Finally, it is to be pointed out that the comparative figures relate only to employed persons. They do no take into account the incomes of the unemployed, of whom there are 113,000 registered to-day, and many thousands more unregistered, compared with the full employment that existed formerly.

It could be a matter for argument as to whether the real income of the average Australian has actually increased during the eleven years of the present Government’s term. However, the matter need not rest in the stage of argument. It is a matter of statistical facts, as revealed in the Budget documents. Here, then, are the official figures. I emphasize that whilst the Commonwealth Statistician is in no way responsible for the conclusions that I draw from them, the figures themselves are official and the calculations involved have been made officially at my particular request. National income in 1949-50 was £2,318,000,000, and in 1960-61, £5,825,000,000. In 1949-50, personal incomes amounted to £2,240,000,000, and in 1960-61 to £5,481,000,000. In 1949-50, the population was 8,000,000, and in 1960-61 it was 10,400,000. Average personal income per head of population in 1949-50 was £280. In 1960-61, it was £527. In 1949-50 the consumer prices index was 66. In 1960-61 it was 124. Those are all the figures needed to make the calculation which I will now give to the committee. Applying the price index which I have quoted and the increase in population which I have quoted to the 1960-61 figure of £527, so as to relate it to 1949 prices, the figure obtained is just under £281. The average personal income per head of population, in terms of 1949-50 consumer prices, was £280 in 1949-50, and is a little under £281 to-day, eleven years later.

I emphasize that these figures are prior to the payment of tax. Tax on these inflated incomes, even though they purchase no more, is at a much higher rate than in 1949. This, again, is demonstrated by the official figures. Personal income tax levied in 1949-50 amounted to £194,000,000, and in 1960-61 to £518,000,000. We all know that if this Government is returned the rates of personal taxation will again be heavily increased in another horror budget next March.

The extraordinary fact therefore emerges that, despite all the improved means of output, despite the vaunted increase in national productivity, despite a succession of good seasons and despite all the efforts of trade unions by collective bargaining and by long struggles before industrial tribunals, the average Australian is to-day not one penny better off in personal income than he was twelve years ago, just four years after the most terrible war in history had ended. Indeed, as a result of the term of the Menzies-McEwen Administration the ordinary Australian and his family are much worse off in effective incomes than they were in 1949-50, because, while the average of personal incomes has not increased, the incomes of some persons have increased tremendously. Company incomes have grown during that period from £253,000,000 to £730,000,000. Even when you reduce that £730,000,000 to its 1949 equivalent in money values, it still represents a tremendous real increase in company profits. Record company profits, record dividends, record bank profits, record interest rates and record hire-purchase transactions have run parallel in this country, during the term of the present Government, with a decline in the economic status and real income of the average Australian worker, while the mass of unemployed has grown to almost depression dimensions.

I am glad to hear Government speakers declare that Australia is not entering a depression, because I well remember the present Prime Minister in this House in recent years vigorously defending the policies that were pursued under bank domination in the depression years, and roundly declaring that if depression again occurred there would be no alternative but to pursue those policies again.

Mr Turnbull:

– He said nothing of the kind.

Mr Allan Fraser:

– That is the actual statement by the Prime Minister in this chamber. Those policies involved, not only the contraction of credit, but also mass dismissals, the slashing of wages and pensions and the creation of misery and despair throughout Australia for several years. I wonder what would be the policy pursued by the Prime Minister if the present situation again reached his definition of depression conditions?


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

Question put -

That the item proposed to be reduced (Mr. Calwell’s amendment) be so reduced.

The committee divided. (The Chairman - Mr. P. E. Lucock.)

AYES: 40

NOES: 64

Majority . . 24



Question so resolved in the negative. (The general debate being concluded) -

First item agreed to.

Progress reported.

House adjourned at’ 11.5 p.m.

page 852


The following answers to questions were circulated”: -

Parliamentary Allowances

Mr Cairns:

s asked the Prime Minister, upon notice -

  1. What total remuneration does he receive as Prime Minister?
  2. What are the component parts of that remuneration, including allowances and salary?
  3. What amounts are received as travelling allowances?
  4. What part of his normal remuneration is tax free or subject to tax concession?
  5. What total remuneration would he need if it were fully subject to taxation to equal the amount which he now receives in salary and allowances after tax is paid?
Mr Menzies:

– The answers to the honorable member’s questions are as follows: - 1, 2 and 3. The Parliamentary Allowances Act makes provision for the allowances, including electorate allowance, payable to all members of Parliament. The Ministers of State Act makes provision for the salaries and allowances payable tor Ministers of State including the Prime Minister. The amounts provided in these acts are in accordance with recommendations of the Committee of Inquiry into the Salaries and Allowances of Members of the Commonwealth Parliament which submitted’ its report to the Government in 1:959. The specific recommendation’s of the committee,, including that in respect of travelling allowances, are summarized on page SO of the report. The report has been given wide circulation and was made available to all honorable members.

  1. No part is tax free. Expenditure of some amounts allowed gives rise to a claim for deduction for income tax purposes.
  2. This part of the question therefore does not arise.

Imports of. Drugs and Medicines;

Mr Cairns:

s asked the Minister for Health, upon notice -

  1. What was the value of (a) penicillin, (b) insulin and (c) the main chemical, medicinal and pharmaceutical products included in Class XIX. of imports, imported into Australia during each period of twelve months ended in March, 1960, and March, 1961?
  2. What was the value of each of these products sold by the Commonwealth Serum Laboratories during each of these periods?
Dr Donald Cameron:

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

Statistics are not available for the periods sought but figures for the. twelve months ended June, 1960, and June, 1961, are as follows: -

Value of penicillin, insulin and the main chemical, medicinal and pharmaceutical products includedinClass XIX.. of imports, imported into Australia during twelve months ended 30th June, 1960, and 1961-

Value of these products’ sold by the: Commonwealth Serum Laboratories during the. same periods -

International Affairs

Mr Cope:

e asked the Prime Minister, upon notice -

Does his so often used phrase “The Free World “ refer only to nations whose governments are democratically elected by the will of the people, or does it include any nation governed by dictatorship?

Mr Menzies:

– AsI indicated in reply to a similar question on 22nd September, 1960, the free world may be broadly defined as that part of the world which is not under the influence or control of the Communist powers. A few countries are, however, in what might be called the twilight zone.

Civil Aviation

Mr Cope:

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

  1. What was the total expenditure incurred in all respects on civil aviation in each of the years 1956-57, 1957-58, 1958-59, 1959-60 and 1960-61?
  2. What income was derived from all sources, including profits from Qantas Empire Airways and Trans-Australia Airlines, during the same years?

Mr.Townley. - The Minister for Civil Aviation has supplied the following information: -

  1. Details of expenditure incurred are as follows: -

Land Settlement of Ex-servicemen.

Mr Davies:

asked the Minister for Primary Industry, upon notice -

  1. How many soldier settlers at (a) King Island, (b) Preolenna, (c) Mawbanna and (d) Togari have received advice of concessions granted by the Committee of Inquiry set up by the Commonwealth and the State of Tasmania?
  2. What amount of credits has been granted to these settlers to date?
Mr Adermann:

n. - The answers to the honorable member’s questions are as follows: - 1. (a) Eighty-two,(b), (c), (d) nil, although the committee has completed its investigations at Mawbanna and its reports will be considered by the Closer Settlement Board in the near future.

  1. £142,209 7s.11d.


Mr Duthie:

e asked the Postmaster-General, upon notice -

What revenue has been received each year from television licences since television transmissions were commenced in Australia?

Mr Davidson:

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

The revenue received from television viewers’ licences each year since their introduction on 1st January, 1957, is as follows: -


Mr L R Johnson:

son asked the Minister for Works, upon notice -

  1. What is the value of furniture made by private manufacturers for use by Commonwealth departments and offices?
  2. Can any furniture, at present being supplied by outside manufacturers, be manufactured by departmental establishments; if so, why is the department not encouraged to stimulate its activities in this regard?
Mr Freeth:
Minister for the Interior · FORREST, WESTERN AUSTRALIA · LP

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

  1. The value of furniture purchased by the Department of Works during the financial year 1960-61 was £1,242,891.
  2. Items at present manufactured in departmental workshops are mainly limited to specialized items such as built-in furniture or special purpose equipment. Furniture of a kind in general use is supplied at competitive rates by manufacturers and it is not considered sound policy to expand the departmental workshops for this purpose.

Employment and Unemployment

Mr L R Johnson:

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

How many job vacancies are registered and how many persons are registered for employment in each Commonwealth Employment Office north of the Tropic of Capricorn?

Mr McMahon:
Minister for Labour and National Service · LOWE, NEW SOUTH WALES · LP

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

At 28th July, 1961, the numbers of persons and vacancies registered at District Employment Offices north of the Tropic of Capricorn were -

Mr L R Johnson:

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

  1. How many people are registered as unemployed in the Northern Territory?
  2. Are jobs available in any part of the Northern Territory which might attract persons from other States; if so, what are the particulars of these jobs?
Mr McMahon:

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

  1. The number of persons registered for employment with the District Employment Office at Darwin on 28th July, 1961, was 175. These were persons who claimed when registering that they were not employed and who were recorded as unplaced at that date. The figures include those who, since registering, might have obtained employment without notifying the Commonwealth Employment Service, persons who have been referred to employers with a view to engagement and persons receiving unemployment benefit. The figures include persons registered for employment with the agent of the Commonwealth Employment Service at Alice Springs.
  2. Yes. They are principally for building and metal tradesmen.

Cloncurry Aerodrome

Mr Riordan:

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

  1. Is it intended to remove the department’s installations at the Cloncurry aerodrome, and also employees’ houses owned by the department, from Cloncurry to Mount Isa?
  2. If so, what are the reasons for the removal and what is the estimated cost?
  3. What is the monetary value of the installations, houses and other property of the department at Cloncurry?
Mr Townley:
Minister for Defence · DENISON, TASMANIA · LP

– The Minister for Civil Aviation has supplied the following answers: - 1 and 2. The question of whether or not civil aviation facilities should be moved from Cloncurry to Mount Isa is complex and involves both an operational and economic analysis of the situation. No decision has yet been taken on the matter.

  1. The value of the civil aviation buildings and other fixed installations at Cloncurry is approximately £40,000. The value of residences owned by the department is approximately £65,000. The estimated value of recoverable material at Cloncurry, which could be transferred if facilities were to be moved elsewhere, is approximately £50,000.

Social Services

Mr Swartz:

z asked the Minister for Social Services, upon notice -

  1. What Commonwealth grant was paid as a subsidy for the Lutheran Church Salem Rest Home Infirmary in Toowoomba?
  2. Was this grant paid in full before the recent official opening of the infirmary?
Mr Roberton:

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

  1. A Commonwealth grant of £2,554 was paid in respect of the sick-bay at the Salem Rest Home, Toowoomba.
  2. The final instalment of the grant was made available approximately three months before the official opening.

Homes for the Aged.

Mr Swartz:

z asked the Minister for Social Services, upon notice -

  1. What grants have been paid for various projects in Toowoomba under the Aged Persons Homes Act?
  2. What Commonwealth allocations are still outstanding for aged persons homes at present under construction in Toowoomba?
Mr Roberton:

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


Mr Whitlam:

m asked the Minister for Immigration, upon notice -

How many aliens all told and how many aliens in each of the twelve most populous nationalities - (a) are eligible for naturalization but have not applied for it; (b) have applied for naturalization but have been refused it for any reason; and (c) have applied for naturalization but have been refused it for security reasons?

Mr Downer:

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

  1. It is estimated that up to 31st December, 1960, 239,120 eligible aliens had not applied for naturalization. Of these approximately 47,824 would be children under the age of sixteen years who could not apply for naturalization in theirown right but would be dependent upon applications by their responsible parents. The estimated numbers of eligible aliens, including children, in each of the twelve most populous nationalities, who had not applied for naturalization up to 31st December, 1960, are -
  1. A total of 9,257 applications for naturalization have been refused or deferred in the first instance. However, this number includes those refused or deferred because of the applicants’ inadequate knowledge of English or of the responsibilities and privileges of citizenship. Many of these applicants would have been naturalized subsequently when their knowledge improved sufficiently. The numbers refused or deferred in the twelve most populous nationalities are -
  1. A total of 199 applicants have been refused naturalization for security reasons or had consideration of their applications deferred. Of this number 44 applications were subsequently approved upon review. The number refused or deferred for security reasons in the twelve most populous nationalities are -
Mr Cope:

e asked the Minister for Immigration, upon notice -

How many migrants of each nationality are eligible, but have not yet applied for naturalization?

Mr Downer:

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

It is estimated that up to 31st December, 1960, 239,120 eligible aliens had not applied for naturalization. Of these, approximately 47,824 would be children under the age of 16 years who could not apply for naturalization in their own right but would be dependent upon applications by their responsible parents. The estimated number of eligible aliens, including children, who had not applied for naturalization up to 31st December, 1960, are -

Intergovernmental Committee for European Migration

Mr Whitlam:

m asked the Minister for Immigration, upon notice -

What percentage of the revenues of the Intergovernmental Committee for European Migration was contributed in 1960 and will be contributed in 1961 by-

the emigration countries;

Austalia; (cj other immigration countries;

the United States of America; and

other sympathizing countries?

Mr Downer:

– The following answer to the honorable member’s question is based on information contained in official documents of the Intergovernmental Committee, for European Migration. For convenience it is proposed to deal separately with each of the years 1960 and 1961: -

The, percentage of the. committee’s revenues contributed by member governments in respect of. the committee’s operational budget for its European progamme for the calendar year 1960 was as follows: -

The balance was subscribed by migrants and/or their sponsors and from other sources. According to the latest estimates, the percentage of the committee’s- revenues that will be contributed by member governments in respect of the committee’s operational budget for its European programme for the calendar year 1961 is as follows: -

The committee expects that the balance will be subscribed by migrants and/or their sponsors and from other sources:.

Penicillin and Insulin..

Mr Whitlam:

m asked the Minister- for, Health, upon, notice. -

How.- much (a) penicillin- and- (b) insulin were (i) produced by the Commonwealth Serum Laboratories; (ii). soldi by the laboratories; and (iti), supplied’ as. pharmaceutical benefits in each of- the: last two financial years?

Dr Donald Cameron:

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

The following are the quantities of penicillin and insulin produced, and sold by the Common wealth Serum Laboratories during the financial years ended 30th June, 1960 and 30th June. 1961:-

The information as to the quantity of penicillin and insulin produced by the Commonwealth Serum Laboratories and supplied as pharmaceutical benefits is not available;

Banking Statistics

Mr Whitlam:

m asked the Treasurer, upon notice -

Have directions been given to the Commonwealth Statistician under, section 59 of. the Banking Act to prepare and publish statements from, the information contained in the balance sheets and’ statements delivered to him by trading and savings banks?

Mr Harold Holt:

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

No directions have been issued to the- Commonwealth Statistician under section 59 of the Banking Act 1959. However, in addition, to the statements, required to- be,- published in the- CommonwealthGazette under section 58 of the Banking Act; the Commonwealth Statistician, with the approval of the Treasurer, prepares and publishes regular statements from the information contained in the balance-sheets- and- statements in: accordance withForms A, B, D,. E, G, I and J furnished by the banks under the act.

Commonwealth and. State Financial Relations

Mr Whitlam:

m asked the Treasurer, upon notice -

What amount of revenue and what, percentage of its total revenue did each State receive in 1959-60 (a) from Commonwealth sources’ and (by from its own sources, apart, from business undertakings?

Mr Harold Holt:

– The information requested by the honorable member is set out in the following table: -

Department of Supply Car Drivers

Mr Whitlam:

m asked the Minister for Supply, upon notice -

  1. In what circumstances does his department arrange for the driver of a Commonwealth car to be represented in court proceedings?
  2. Does his department pay the costs of an employee who has been acquitted of a charge involving his driving of a Commonwealth car on duty?
Mr Hulme:

– The answer to the honorable members questions is as follows: - 1 and 2. In general my department does not provide or pay for the representation of a driver in court proceedings unless some direct interest or liability of the Commonwealth is or may be involved. In the nature of things such an interest or liability is much more often present in civil than in criminal proceedings. Any request to depart from this general rule is examined upon its own merits in the particular circumstances.

Radiation and Radioactive Substances

Mr Whitlam:

m asked the Prime Minister, upon notice -

  1. What progress has been made towards federal legislative control of all uses of ionizing radiation as recommended by the National Radiation Advisory Committee in July, 1959, and July, 1960?
  2. In which States and Territories does radioactive substances legislation conform with the (a) model act, (b) model regulations, and (c) amendments recommended by the National Health and Medical Research Council in May, 1954, November, 1957, and November, 1959, respectively?
Mr Menzies:

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

  1. The recommendations of the National Radiation Advisory Committee, concerning federal legislative control of all uses of ionizing radiation throughout Australia, are still being considered by the Government. Owing to the complex constitutional and other difficulties involved, a decision has not yet been reached whether the Committee’s recommendations are to be put into effect.
  2. The following Acts and Regulations have been adopted by the States towards putting into effect the model legislation recommended by the National Health and Medical Research Council: -

New South Wales -

Radioactive Substances Act, 25th March, 1957.

Regulations: 29th June, 1959.

October, 1959.

Victoria -

Health Act 1958.

Regulations: 29th June, 1959.

Queensland -

Radioactive Substances Act, 7th May, 1958.

Regulations: 25 th March, 1961.

South Australia -

Health Act Amendment Act, 15th November, 1956.

Regulations: None promulgated.

Western Australia -

Radioactive Substances Act, 30th December, 1954.

Regulations: 12th December, 1958 - amended October, 1960, in accordance with National Health and Medical Research Council Regulations.

Tasmania -

Radioactive Substances Acts, 21st September, 1954, and 3rd April, 1957.

Regulations: None promulgated.

Legislation for adoption in the Australian Capital

Territory and the Northern Territory is at present being drafted.

Poisons Legislation

Mr Whitlam:

m asked the Prime Minister, upon notice -

In which States and Territories does poisons legislation conform with the proposals which the National Health and Medical Research Council requested him to make in May, 1959?

Mr Menzies:

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

In Queensland the poisons legislation conforms with the proposals made by the National Health and Medical Research Council in May, 1959. In the other States and in the Australian Capital Territory and the Northern Territory the matter, which does involve some important and complicated questions, is under active consideration and, in several instances, drafting ia under way.

Cite as: Australia, House of Representatives, Debates, 5 September 1961, viewed 22 October 2017, <>.