24th Parliament · 1st Session
Mr. SPEAKER (Hon. Sir John McLeay) took the chair at 2.30 p.m., and read prayers.
Nuclear Tests. Mr. BRYANT presented a petition from certain electors of Coburg praying that the Government take immediate steps to impress on the Governments of the United States of America and the Union of Soviet Socialist Republics the dangers involved in the testing of nuclear weapons and to urge them to refrain from further testing and to cooperate in achieving full-scale disarmament.
Petition received and read.
Mr. JONES presented a petition from certain citizens of New South Wales praying that the use of the area known as the Bombing Range at Anna Bay for Air Force bombing and Army gunfire be discontinued forthwith, and that the range be shifted to the area known as Uralla, or to Salt Ash or one of the islands off the coast.
– Has the Minister for Primary Industry any knowledge of the operation of wool pies, which are a combination of buyers who select one bidder to buy on behalf of a group? This practice depresses prices and causes the loss of millions of pounds to woolgrowers. Has the Minister had any discussions with the wool-broking and woolselling agencies with a view to eliminating this pernicious practice? If not, will the Minister look into this position and advise the House what steps may be taken in the near future - or is he content to leave it with the report of the wool committee?
– I have some knowledge of the report to which the honorable member refers, which was made by Mr. Justice Cook and1 presented to the New South Wales Government, and of the reference made in the report following the recent inquiry into the wool industry. As far as action in this matter is concerned, I suggest that the honorable member might take this up with the Premier of New South Wales if that State is affected, because jurisdiction to deal with this matter is in the hands of the State. However, the Government is prepared to consider representations on any aspect of the industry, including this aspect, that may be made by the organizations concerned with the industry. Cabinet has not dealt fully with the report of the wool inquiry, but will consider it in more detail when the industry organizations have made up their minds and come to the Government with their representations.
– I ask the Prime Minister whether, in response to written and spoken representations, speeches and informative questions from honorable members on both sides of the House, the Government has yet had the opportunity to consider whether it is prepared to restore the crowning glory of the General Post Office in Sydney. If so, will he give an assurance that the work will be carried out expeditiously so that hope deferred may no longer sicken the hearts of Sydney’s citizens?
– Mr. Speaker, I told the honorable member in reply to a letter that I received from him that I was proposing, with the complete concurrence of the Postmaster-General, to have this matter looked at. Of course, I also had in mind the powerful speeches made by the honorable member for West Sydney and other honorable members. In the result, I am happy to be able to tell my Sydney friends that although it is said that you cannot put the clock back we propose to do it with all reasonable speed.
– I direct a question to the Minister for Shipping and Transport. I ask him whether he has done anything to follow up the suggestions put to him by the honorable member for Farrer more than two years ago that the standard-gauge railway be extended from Melbourne to Geelong so that Geelong’s machinery, fertilizers and other products, as well as Melbourne’s products, should have direct access to the Riverina and all points north. More generally, 1 ask him for information on any Commonwealth moves to make railway grants to decentralize industry and commerce in provincial centres like Geelong and Rockhampton as well as to centralize them in State capitals.
– Standardization of railways is obviously a matter of policy, and the line from Melbourne to Geelong is a matter for the State of Victoria. If the honorable member will put his question on the notice-paper I will have a further look at the points raised in it.
– Has the Minister for Labour and National Service had brought to his notice statements by certain trade union leaders in South Australia about the tremendous improvement that has been achieved in employment since the Government’s economic measures were introduced? Do the facts and figures disclosed by these trade union leaders generally coincide wilh the information in the hands of his department?
– I have read statements made by the leaders of three trade unions in Adelaide. They are the Bricklayers Society, the Amalgamated Society of Carpenters and Joiners and a third, which I think was the Plasterers Society. The comments give strong grounds for thinking that the building industry in South Australia has fully recovered and’ that the scale of activity is now as high as it was in 1960. The information given by the trade union leaders coincides fairly exactly with the information at the disposal of my department. I think the honorable gentleman will probably know also that the official in South Australia whose office is equivalent to that of the Registrar-General in other States, has stated that the number of land transactions now is at least as high as it was in the boom period of 1960. I think this confirms everything that the honorable member for Sturt has said.
– My question is directed to the Postmaster-General. I refer him to the objections he should have received - I have received copies of them - from people in the Cape York Peninsula regarding the postal run through the peninsula known as the stations run. Tenders have been called for this run by air or road. Although delivery by road would be cheaper, does the Postmaster-General not consider that reverting to the pack-horse for postal runs in this area would be a retrograde step? Will he delay acceptance of the road transport tenders until all means of subsidy have been investigated? Will he also consider the decentralization and health aspects? This area is now serviced by the flying doctor and ambulance. After a visit by the flying doctor, medicines that are urgently required can be taken by air on the next day, whereas delivery by pack-horse is sometimes delayed up to three months because of flooded creeks.
– This matter has been referred to me by my administration in Brisbane. For several years, Bush Pilot Airways Limited has been carrying air mails throughout the peninsula and has been giving a very good service. However, at the expiration of the last contract, fresh tenders were called and the tenders submitted by the pilots were a substantial increase on the previous charges. Quite properly, the department made some investigation to ascertain whether the very great increase was warranted and whether any cheaper form of service could be obtained, provided it was efficient. Fresh tenders have been called and discussions are proceeding between the department and Bush Pilot Airways Limited. No decision has yet been taken and no decision will be taken until I have examined the information to ascertain how this rather difficult matter should be adjusted.
– I desire to ask the Minister for the Army a question. I refer to certain petitions which have been presented in this House, requesting that a heavy artillery range be established at Uralla. I point out that Uralla is situated in the heart of the New England tablelands. Before the Minister gives consent to any proposal to establish a range in this beautiful mountain district, will he consider the probability that, apart from the effects on people’s nerves, there will be a repetition of the destruction of walls and windows by concussion, and of the other disabilities that were apparent at Anna Bay? Will the Minister also consider that numerous and valuable sheep studs in the district may have their lambing completely ruined and that cattle studs also may be seriously affected? 1 ask: Will the Minister consider the matter seriously and have the range taken well out to sea to some islands?
– I appreciate the honorable member’s interest in this matter, which does not solely concern the Army. I think that the petitions were directed more to aspects concerning the Royal Australian Air Force. Furthermore, the honorable member may be confusing two different places. I think that he is speaking of the town of Uralla near his own area, whereas, if my memory serves me correctly, the petitions refer to a locality “ known as Uralla “ which is just north of Newcastle. So perhaps his concern is not well founded. Nevertheless, we shall have a look at the considerations involved.
– I wish to ask a question of the Minister representing the Acting Minister for Trade. By way of preamble, I state that on two occasions I have raised the matter of trade between Australia and Israel and asked why the recent trade mission to the Middle East had not visited Israel. I now ask: Will the Minister answer the suggestions of discrimination implied by the omission of Israel from the itinerary of the trade mission? I ask, further, whether any action is being taken to improve trade between Australia and Israel.
– I know the interest that the honorable member has shown in this matter. I know, also, that he has raised it in this House on several occasions. Several weeks ago, I replied to a question that he asked about the trade mission that had only just returned from the Middle East. I intimated to the honorable member and the House then that, apart from considerations purely of trade in relation to the programme for the mission, political considerations came into the picture, and they were an over-riding factor in regard to the point that the honorable member had raised.
I think that we should also have an appreciation of the value of our trade with all the countries visited not only by that trade mission, but also by the trade ship “ Chandpara “ which is at present in that region. Looking at the figures, we find that the value of exports from Australia to the countries visited by the trade mission and the trade ship totalled more than £33,000,000 last year, whereas our total export trade with Israel in the same year amounted to only about £84,000. On the reverse side, the value of our imports last year from the countries visited by the mission and the ship totalled more than £66,000,000, whereas our imports from Israel were worth about £500,000. I give those figures merely to show the present importance, from a trade aspect, of the countries other than Israel.
I assure the honorable member that the importance of Israel as a market is not overlooked, however. At present, Israel is given most-favoured-nation treatment with respect to Australian tariffs and there are no restrictions against imports from that country. Unfortunately, however, Israel at present imposes some fairly substantial restrictions on imports, and these affect our trade opportunities in that country. We hope that there may be some relaxation of those restrictions in the not-too-far-distant future.
As the honorable member knows, I think, already Australian capital and know-how have assisted in the development of a wooltops industry in Israel which will provide further opportunities for trade. We hope that assistance by the provision of Australian capital and know-how will be extended. There is the further possibility of the development in the not-too-far-distant future of a direct shipping service between Israel and Australia. The honorable member may rest assured that we are examining all proposals for the improvement of trade relations between the two countries.
– I ask the Treasurer whether there is any provision in the Bills of Exchange Act which would prevent Victorian banks from working a five-day week and remaining closed on Saturdays.
– I shall have to refer to the legislation, and when I have done so I will supply the honorable member with an answer.
– My question is directed to the Minister for Labour and National Service. So that Parliament may have a better appreciation of the problem of unemployment in this country, will the Minister arrange for statistics to be published regularly showing the numbers of persons registered as unemployed in various industrial groupings, and also the length of time during which such persons have been unemployed? I understand that this information is available in the department, but is not released for the information of the public generally.
– I think I should say that one of the main purposes of the Department of Labour and National Service is to ascertain the number of jobs available and the number of people who register as unemployed, and to place those people in employment as quickly as possible. That is the paramount objective ot the Commonwealth Employment Service and of the section of the department administering that service. I have always believed in giving this task priority and in providing an adequate supply of staff to accomplish it. Very many suggestions have been made to me concerning the publication of statistics in addition to those that are now made available, including statistics such as those mentioned by the honorable member for Blaxland, concerning numbers of persons registered as unemployed in various industrial groupings and the times during which people remain registered as unemployed. I will have another look at this matter, and if I feel that we can usefully supplement the information that is now provided in the monthly statement, 1 will see that the supplementary information is included in future statements.
– My question is directed to the Minister representing the Acting Minister for Trade. I preface it by reminding him that from time to time the Government members trade committee has recommended the establishment of an overseas warehousing system to assist Australian exporters. What action has been taken with regard to these recommendations?
– The Government members trade committee has shown a very keen interest in this subject, as well as in other matters relating to our export trade. [ know that it made certain submissions to the Minister for Trade some time ago. As the honorable member for Maribyrnong will recall, the Prime Minister informed the House, in the course of a statement made last year, that the Government was considering the introduction of a warehousing system to boost our export trade. Arrangements were subsequently made to appoint two trade consultants to the Department of Trade. These officers spent some time in various countries overseas, examining the prospects and the possibility of instituting a system of this kind. Upon their return they submitted a report favouring the introduction of the system, but as the recommended scheme was an innovation so far as Australia’s export trade was concerned, the Government arranged for the matter to be examined by a special committee of the Export Development Council. I understand that the council has practically completed its investigations. In addition, feelers were put out amongst exporters generally to ascertain their views on the suggestion. We expect that the report of the Export Development Council will be available very shortly to the Department of Trade, and I expect that as a result of the report the new system will be introduced.
– My question is directed to the Minister for the Army. Has the Minister examined the report of the Commonwealth Scientific and Industrial Research Organization on the merits of cloth woven from a mixture of cotton and terylene? Does that report recommend that the use of wool in the weaving of cloth for Australian Army uniforms be discontinued? When is it expected that the stockpile of woollen cloth which was accumulated during the Korean war will be used up, so that
Australian soldiers may receive the benefit of summer uniforms made with the lighter, tougher, longer-lasting cotton and terylene mixture?
– I do not know whom to satisfy here. This matter is under consideration at the present time and tests are being made in the Army on various kinds of cloth for any proposed new uniform. I will let the honorable member know when a decision has been reached.
– I address a question to the Minister for Primary Industry. It concerns residual pesticides in plant and animal foods. I preface my question in that way, first, because of trading restrictions that have been placed on agricultural commodities which have been treated with chlorinated hydrocarbons or systemic chemicals, and the interruption that this is causing to world trade, and, secondly, because of the concern about the effect that these chemicals may have on human beings. I ask the Minister whether he could make the necessary moves to instigate discussions between countries, probably at the Food and Agriculture Organization or World Health Organization, whereby some international regulations may be laid down accepting certain products treated with certain chemicals.
– The Food and Agriculture Organization at its first biennial conference held in November last decided that this matter was of such importance that the countries interested should call a conference to discuss it. That conference met and decided to appoint a few technicians to prepare a report for submission to the full meeting of the conference which is to resume consideration of this very important matter in about October of this year.
– I desire to ask the Prime Minister a question supplementary to the question asked by the honorable member for Bradfield. Is it a fact that my friend and colleague, the honorable member for West Sydney, has consistently advocated the restoration of the Post Office clock in Sydney? Is it not a fact that Sydney’s main clock is now situated over the top of a men’s convenience in Martin-place? Will the Prime Minister agree that a lot of water has passed under the clock since the honorable member for West Sydney first brought this matter to the notice of the House?
– I must say one lives and learns. I thought I had acknowledged the eloquent advocacy of the honorable member for West Sydney on this matter when I told the House what we were proposing to do to put the clock back. But the honorable member for Watson introduces me to a new world when he tells me that this clock which we are going to put back is the one which I can see in a certain convenient position in Martin-place. I do not think that is so. I think the Post Office clock is in safe storage, with all the stones numbered, and it will be replaced, if not in its pristine beauty, at any rate in its beauty.
– You will put it back at your convenience?
– I direct a question to the Minister for Labour and National Service. Will he inform the House approximately how many applications have been lodged, up to the present time, for officially conducted secret ballots for the election of trade union officials, and approximately how many unions have availed themselves of this protection against rigged ballots by Communist officials?
– I think what is implied in the honorable member’s question is that the trade union movement itself has shown marked approval of the secret ballot legislation of the Menzies Government. There have been 225 applications made by the unions and I think there have been 23 unions involved in those applications. I think that record shows the confidence of the unions in this legislation and the need for them to obtain protection. The purpose of this legislation was to give the rank and file trade unionists the opportunity to elect their own leaders and to keep alien elements out of the trade union movement.
I think both of those objectives are being met by this legislation.
– I ask the Minister representing the Minister for Health whether he is aware of the fact that privately sealed addressed letters from people living in Ireland, airmailed to residents in Sydney, and containing shamrocks for Saint Patrick’s Day have been opened and the shamrocks removed. I also ask whether heather arriving from Scotland for New Year’s Day celebrations is given the same treatment.
– I am sorry, but this is a matter about which I have no knowledge. It is almost an international problem and perhaps the question should1 more correctly be addressed to the Minister for External Affairs. I shall see that the matter is referred to my colleague in another place and that a suitable reply is furnished to the honorable member.
– I ask the Minister for Labour and National Service whether he can give me any information regarding employment in those industries in which both he and the Prime Minister have been actively engaged in recent months; namely, the building industry, the motor vehicle industry and1 the textile industry.
– I think it is true to say that while we have not been actively engaged in those industries we have been very interested in them. If I may, let me answer the question in this way: First, as to the building industry, there has been a large increase in the number of vacancies registered lately - it was over 1,000 - and it is becoming increasingly difficult throughout Australia to find skilled workers for the building trade. Additionally, the materials supply division of the building trade is trying to obtain more employees. As to the motor vehicle industry, I think it is common knowledge now that the number of vehicles being produced is at a high level and consequently the number of people being employed is increasing. As to the other very sensitive industry about which we were cautious, and which we watched very carefully over six months ago - the textile industry - I can inform the honorable member that the February figures did show a substantial increase in employment in that industry.
– I address a question to the Minister representing the Acting Minister for Trade. Do the unrestrained criticisms of the United States tariff policy attributed to the Minister for Trade, as reported from Brussels in the daily press of Australia on 6th April, represent the Government’s attitude on Australian-American relations? Is the purpose of the Minister’s present overseas visit to deliver lectures on trade matters in every European capital, or is it to try to win friends and influence people for the benefit of the hard-pressed primary producers of Australia?
– I have not seen the text of any of the statements referred to by the honorable member, but, as he knows, the Minister for Trade was in the United States of America, and had a very successful visit there, before he went to the United Kingdom and Europe. As I said the other day, and as was stated by the Prime Minister during the last week or so when matters of this nature were raised, it is difficult to say whether the statements which appear in the press here are correct. The Prime Minister has stated that when the Minister for Trade returns he will make a full statement in relation to all these matters, and I do not doubt that an opportunity will be given to the House to discuss it.
– I ask the Minister for Primary Industry whether he is aware of a question upon notice regarding the wheat industry, asked by the honorable member for East Sydney, the answer to which is recorded on page 1462 of “ Hansard “ of 5th and 6th April. Does he realize that the question contains a veiled criticism of a contribution by the Commonwealth to the Wheat Prices Stabilization Fund? Is it a fact that any Commonwealth contribution to this fund will be insignificant when compared with the contribution of the wheat industry to the Australian economy?
– I rise to order! The honorable member for Mallee is inviting the Minister to enter into a discussion of a question which is on the notice-paper, and I suggest that he is out of order.
– Any comment would be out of order, but I think that the honorable member has completed his question.
– I remember the honorable member for East Sydney asking a question on the wheat industry to which I gave as full an answer as I was able. I think it fair to say that the question of the honorable member for East Sydney could have been interpreted as a criticism of the wheat stabilization scheme. This Government wholeheartedly supports that scheme. We fully recognize the worth of wheat exports to Australia’s economy, even if the honorable member for East Sydney does not.
– Is the Prime Minister aware that the British Government is now collecting a capital gains tax in order to deal with speculative gains? As similar speculative gains are available to speculators, free of tax, in Australia, will he consider introducing similar legislation with a view to reducing income tax on lower incomes?
– All that I know about the recently delivered Budget in the United Kingdom is what I have read in the newspapers. The entire Budget speech which, no doubt, will contain many details of these proposals, will be received by us in due course. I have no doubt that it will receive the close attention of the Treasurer and of the Cabinet generally.
– Has the Prime Minister’s attention been drawn to a recent statement by a former lord mayor of Auckland in relation to the possibility of New Zealand entering into the Commonwealth of Australia? Has he noted the editorial comment made yesterday by the “ Auckland Star “ on this matter? In view of the fact that the long-term interests of both Australia and New Zealand are likely to require this union on both strategic and economic grounds, but that sectional interests in both countries are likely to be adversely affected-
– Order! The honorable gentleman will ask his question.
– Will the Government put in train a study of ways and means of giving fair compensation to such sectional interests and proper assurances that they will not be unfairly treated in the event of ultimate trans-Tasman union? In view of the fact that this would be the most important constitutional development since federation, will the Prime Minister consider the appointment of a select committee of this House to consider the issues involved?
– Mr. Speaker, the future relations between this country and another member of the Commonwealth must be, of course, a matter of profound importance to both nations. Such a problem is clearly one of considerable delicacy. I think that if the Prime Ministers of such countries begin to make statements about what they think ought to occur we will get nowhere. I would prefer to be excused from offering comment on a matter of this kind.
– I ask the Minister for Immigration what supervision, if any, is exercised over Asian students attending universities and colleges in Australia. Are guardians appointed either by the Department of Immigration or parents to watch the progress and welfare of the students? I bring this matter to the notice of the Minister, knowing that the moral, social and spending habits of some of these students militate against effective study. As a result, they are repeatedly failing in examinations. What knowledge has the Minister of this matter? Can he do anything to arrange for the guardianship of Asian students while in Australia?
– The honorable gentleman has asked, as he probably realizes, a very comprehensive question with a good many complexities. I do not think that the question can be answered conveniently or fully at question time. I shall content myself by saying that the Asian students who come here, and whom we are very pleased to welcome, are admitted under certain prescribed conditions. The Department of Immigration is always vigilant in seeing that, in the broad, those conditions are observed. We make sure, for example, that a student passes his examinations regularly and that he maintains a reasonable degree of attendance at a university, technical college or training college as the case may be.
From time to time, cases arise where students fail to pass their examinations, or, as the honorable gentleman has said, they misbehave. These things engage the attention of my department very promptly. They are also brought to my personal notice and the students have to be asked to return to their country. I am sorry to say that if they prove to be completely unco-operative and recalcitrant and disobey the terms of the conditions under which they enter Australia, then I have to sign a deportation order against them; but I can assure the honorable gentleman that this is a matter which is continually being looked at by my department and also by me.
– I preface a question to the Postmaster-General by referring to an answer the Minister gave yesterday to a question asked by the honorable member for Moore about the granting of a concessional television licence-fee for people in areas remote from a television transmitter. Ultimately, it will be necessary to test the viewing areas from each station, as the Minister has said. However, is it not a fact that it would be possible now to prescribe a distance of, say, 100 miles outside which a viewer could not get the sort of reception which would justify the payment of a full licence-fee? If this is a fact, will the Postmaster-General consider bringing in a concessional licence-fee in such circumstances, bearing in mind that many of my constituents living more than 300 miles away from a transmitter have televison sets, although they get reception on only a few days a week?
– The honorable member for Barker suggested that the PostmasterGeneral’s Department might be able to prescribe at this stage a distance from a television transmitter beyond which reason^ able reception could not be obtained. I think that is the gist of his question. In reply, I inform him that varying results are achieved from the development of television. Some areas much less than 100 miles from a transmitter would not receive a really good signal. In other areas, under different conditions, a good signal would be received. We have had instances of this in relation to much greater distances. Therefore, in my opinion, it is not practicable to lay down any particular distance at this stage.
I repeat what I said in reply to a question yesterday: This is a matter which will be carefully watched by the Australian Broadcasting Control Board and by the Postal Department. We are constantly carrying out tests. I should say that if a person wanted to find out what type of reception he was likely to get in any particular locality to be served by a station that was to be erected, such information could be obtained by him from the board because before the sites are determined, very careful field tests are carried out. The board has a very good idea, therefore, of the actual signal strength that will be available in any particular area prior to the operation of the station. I am sure that in any particular cases, the board would be glad to make such information available either directly or through me.
Motion (by Mr. Calwell) agreed to -
That leave of absence for one month be given to the honorable member for Batman (Mr. Bird) on the ground of ill health.
– I have received a letter from the honorable member for Fremantle (Mr. Beazley) proposing that a definite matter of urgent public importance be submitted to the House for discussion, namely -
The need, as one factor in preparing the people of Papua and New Guinea for self-government, to establish a University of Papua with faculties designed to meet urgent needs and with residential colleges; and with ancillary high schools and technical schools to give secondary schooling adequate to prepare the undergraduate students of that University for University courses.
I call upon those members who approve of the proposed discussion to rise in their places. (More than the number of members required by the Standing Orders having risen in their places) -
– Since the Opposition gave notice of its intention to raise this subject as a matter of urgency, the Minister for Territories (Mr. Hasluck) has issued a statement which has been broadcast by the Australian Broadcasting Commission concerning the intentions of the Commonwealth Government at some time before 1966 to establish a university college in Papua and New Guinea. However, the Minister’s statement appears to associate a number of unrelated things. He associated with the statement the intention of the Government to establish an administrative college. We feel that there is no relationship between an administrative college and a university and we are sorry they are mentioned in the same breath. We intend to proceed with this matter to-day for reasons to be found in the Minister’s Statement and for world considerations.
I am not speaking about world criticism of all colonial powers and all powers that are administering trust territories. I speak about the world position that has been demonstrated now that certain emergent powers have their independence and have set about adopting a solution of their own problems of education. Nigeria to-day is training 27,000 teachers in a year and it plans to be training 60,000 teachers in a year by 1970. Indonesia points to the fact that more has been done for education in twelve years of independence than was done in 350 years of Dutch rule.
There is a growing conviction among our critics in the United Nations and our friends abroad that the succession states that have come into being as a result of the dissolution of empires are doing a better job than those European powers which argue for the continuance of the administration of those territories on the ground that they are advancing backward people. The Minister’s statement about a university college does not meet our view about a university, and it seems to have been discussed within the Administration only and not submitted to the Australian Universities Commission. No vice-chancellor or interim committee has been appointed. They, and not the Administration, should set up the university.
When the Australian National University was established it was not established as a result of discussion in the Department of the Interior. A vice-chancellor was appointed and a university council was appointed, and the council’s recommendations made from time to time were accepted by the Government. What was established then was what the world community of universities would accept as a university.
There also seems to be a continuation of a rather leisurely approach to this problem in that the Minister’s statement says that this college will be established by 1966. I say a “ continuation “ because in the latest reports of the Territory of Papua to this Parliament and the Trust Territory of New Guinea to the United Nations this identical statement appears -
There are no universities in the Territory and same years must elapse before their existence can be justified. Qualified students have access to universities in Australia.
If we are asked why we are in New Guinea and Papua, what answer do we give? In 1884, when Queensland was urging upon the United Kingdom Government the annexation of what became British New Guinea and later Papua, the answer that would have been given is, “ We are there for strategic reasons “. But I submit there is only one answer that we can give to-day, and that answer is that we are there to establish a nation capable of standing on its own feet. A university is an instrument for this purpose.
On 29th August, 1961, the Minister replied to the Deputy Leader of the Opposition (Mr. Whitlam) concerning the present situation of education in New Guinea and Papua. His statement is interesting, because it reveals that in secondary education in New Guinea - in the Administration schools, in mission schools which were regarded as efficient and in mission schools that were not registered as efficient, and studying in Australian secondary schools - indigenous and non-indigenous children numbered 5,770. When the University of Western Australia was established in 1913 the State of Western Australia had one secondary State school - Perth Modern
School - which had been created only two years before and which had fewer than 400 students. There were not many more than 1,000 students in every form of secondary school in Western Australia then. The sum total of children mentioned in the Minister’s reply of 29th August, 1961, as getting some form of secondary education - and 2,100 of them were getting it by correspondence - is 5,770. Of those, 1,101 are European children studying in Australian secondary schools. In other words, by any standard, there are more children getting secondary education in New Guinea and Papua to-day than there were in the State of Western Australia when the University of Western Australia was founded.
We do not think that what has to be immediately rushed up is a set of magnificent buildings, but I want to warn the Government, if the approach is going to be leisurely, of our experience in the Australian National University, with the council of which I was associated from its inception in 1947. If there were any delays in building by the time you got round to the job four or five years later the building cost three times as much. At one stage in the Parliamentary Library Committee we considered the building of the Australian National Library. The estimated cost was £2,500,000. I understand that the estimate is now in the vicinity of £10,000,000.
We believe it would be an earnest of real effort on the part of the Government if it got the vice-chancellor and the interim council appointed and let them start the process of investigating what ought to be done about buildings, the siting of the university and so on. We ask the Government to proceed with this as early as possible.
The problem of advanced education in areas of mass illiteracy is now being solved in many parts of the world. A United Kingdom-led committee consisting of three university men from the United Kingdom, three from the United States and three from African universities has recently published a report that is regarded as one of the decisive documents on this subject in the world. The committee was under the chairmanship of Sir Eric Ashby, and it framed its findings in a document titled “ Investment in Education. The Report of the Commission on Post School Certificate and
Higher Education in Nigeria.” It is my opinion that Sir Eric Ashby ought to be invited to Australia to consider the problems of education in New Guinea. Also on that committee was Dr. Onabamiro, who is now Minister for Education in the Western Region of Nigeria, who succeeds another man who might well be invited to Australia - Mr. Awokoya, a former Minis. ter, who has been responsible for the establishment of compulsory education among 6,000,000 illiterate people. Then there is Dr. Kenneth Dike, a principal of the Ibadan University College in Nigeria, who also would be a man able to give us advice.
I want to say this about all the emergent countries and about the kind of world opinion we are likely to find in the United Nations: If you establish a university to-day without hesitation, and European children of the Territory are sent there by their parents, that will be regarded throughout all Africa and Asia as a guarantee that it is a university of genuine standing. There is not the slightest resentment in all these new countries that in the initial stages the majority of students are European. The great Belgian Congo State University started off with 104 students, 94 of whom were European and ten African. The great Catholic University of Lovanium in the Belgian Congo, which is associated with the University of Louvain, in Belgium, started off with 33 students, of whom 30 were African and three European. The immediate effect of the establishment of these places is to draw into a rational line the whole structure of education in those countries - to give it a new motivation - and the fact that initially very few were attending was not regarded in any way as taking from the value of the institution. In those places, in only five or six years, enrolment multiplied ninefold, tenfold or elevenfold.
The University of Louvanium has magnificent buildings which far outshadow those of the Australian National University, and was built originally for 33 students. That advance building was done, and now the buildings are almost totally occupied. Incidentally, in all the roaring chaos of the Congo that university and the Belgian Congo State University have been left without interference.
The Labour Party believes that a university should start off with a number of key faculties. I say this, subject to what the interim council and the vice-chancellor may themselves recommend; but we might think, in the first instance, of faculties of arts, science, education - which is crucial in countries of mass illiteracy - engineering and agriculture. The Ashby committee’s report said -
We wish to make some general comments on what our survey of the whole Nigerian scene leads us to conclude concerning the courses which should have an early place in the line of development of new universities. A basic subject . . . is agriculture. A second is education, that is the preparation of teachers and research into the many varied problems of teaching. A third will be engineering. Lastly, expansion should be promoted of Departments of extra-mural subjects.
The report refers to study kits and speaks about them as a feature of Australia and New Zealand. I understand that they are boxes of books sent to external students. Correspondence courses in secondary education have already started in New Guinea and it may well be that some people in the Administration could gain the benefit of such extra-mural study.
We also believe that the university should be free. The University of Western Australia is not free, and I wish the Minister for Immigration (Mr. Downer) would change his propaganda in London accordingly. The university now charges exactly the same fees as other Australian universities charge. But we believe that the university in New Guinea should be free. We believe that there should be residential colleges. Some of the denominations may establish these in the same way as they have established them in Australia, and they should be assisted as they are in Australia. There are special reasons why there should be residential colleges. It is of the essence of a university that the responsibility for seeing that students are educated rests with the students themselves. But the indigenes of New Guinea have special need and the college is a place of encouragement and help which they could not possibly get effectively in boarding houses.
We believe also that the university should have a pre-university section. This is a characteristic of all the new universities in the emergent countries. About half the students come to the university without yet having attained the standard that enables them to proceed with university work. So they are given, within the university, one or two years of pre-university work, which may be the equivalent of what in the United Kingdom would be called a sixth form course, with special help to prepare them to go on to university work.
It is also very important, in view of the large numbers of these young people who do not come from homes with reading backgrounds, that there should be training in some of the new techniques of rapid and accurate reading. I understand that certain members of the Parliament have been undergoing courses in such techniques. What is critically important-
– Order! The honorable member’s time has expired.
– I thank the honorable member for Fremantle (Mr. Beazley) for the clear and moderate way in which he has stated his case. But with all respect to him it seems to me that his speech revealed that he has a far more extensive and profound knowledge of Africa than he has of New Guinea. The reason for that is quite obvious. I understand that he gained his knowledge of Africa from reading, and he certainly would have gained his knowledge of New Guinea from reading. As far as I know, he has not - in common with a great number of his colleagues, except the Leader of the Opposition (Mr. Calwell) - taken the trouble to go to New Guinea to see what we are doing there or to ask questions which would elicit information about what we are doing there. I suggest that the honorable gentleman, instead of quoting his African reading to us, should apply himself to the study of conditions as they really exist in Papua and New Guinea and of the problems that must be overcome.
I am sure there is no difference in objective between honorable members on both sides of the House. There is no less enthusiasm on this side of the House than there is in the mind of the honorable member for Fremantle for the eventual establishment of a university in Papua and New Guinea. We realize that a university is an essential part of the whole educational structure and it is an essential part of the preparation of a people to perform for themselves all the functions of a full community. But the situation in Papua and New Guinea is not closely analogous to that in Africa. It is certainly very dissimilar from the situation we know in Australia, and it has particular problems. It is our job as members of the legislature to study and understand the problems and to apply ourselves to the mastery of them.
The first point that the honorable member for Fremantle made was, broadly, to the effect that he did not like the question of a university being mixed up with other forms of higher training. I respectfully suggest that the question of a university in Papua and New Guinea cannot be separated from many other forms of higher training. After making intensive efforts for the promotion of education in the Territory, we found that various forms of higher training were necessarily developing. I shall quickly mention one or two. In the Education Department itself, we have technical training, teacher training and secondary training. Out of teacher training arises speculation about how soon we can get our teachers, who are trained initially for primary school work, into universities. We have a Public Service Institute, created in the time of the present Government, to help members of the Public Service to take university degrees by external courses or to take other forms of higher training to prepare themselves for promotion in the service. In the Public Service Institute, under the impulse of the improvement of administration, we have a number of people, both European and indigenes, taking university courses by external study and a number of people taking higher training in various forms.
We have in Sydney, as honorable members know, the Australian School of Pacific Administration, in which we give a series of courses. Some of the courses, such as the course for cadet education officers, involve university study. In eight different departments, including the Department of Health, the Department of Native Affairs and the Department of the Post Office, we have courses of training in which young men and young women, picked up at various levels of education, are being trained for higher duties of various kinds.
Out of that situation, about two years ago we realized that we were nearing the point at which we could plan in a realistic way for a university, and at which university training would be an essential part of the continuation of the other forms of higher training which we have already initiated. In 1960, as a preliminary an officer of the Department of Territories was appointed to survey the whole of this field, taking as his starting point the existing forms of higher training. He came forward with quite a voluminous and very useful paper surveying the facts of the situation. Out of his departmental working paper there emerged a recommendation, which was immediately adopted, that we should set up an expert inter-departmental committee, which would try to draw out of the paper the recommendations that could be immediately implemented. At that early stage, a university college was seen as an essential part of the pattern.
We set up the inter-departmental committee. Its members included the principal of the Australian School of Pacific Administration’, who is a university graduate of some distinction and a person familiar with tertiary education. Another member of the committee was a representative of the Prime Minister’s Department, who is also a representative of the Government on the council of the Australian National University. He is familiar with planning in connexion with the Australian National University. The chairman of the committee was a senior officer of the Department of Territories, and the committee also included two officers from the territorial administration. The committee, doing an official job for the Government, produced a report which was immediately adopted on presentation. This showed the way to the planning of the various further steps I announced recently.
These steps are all intertwined because they are derived from the same situation. As I announced, the recommendations included the establishment of a central residential administrative college as soon as possible, in order to continue with training, including some training at a university level, which is at present being done in the Public Service Institute, and to extend that training, including training at university level, to more and more students. That is a first step to meet the existing position, using officers and people outside the Public Service who are already waiting to receive this aid for administrative training. The second suggestion was that a university college, linked with an Australian university, be established in Port Moresby. After a survey of the potential undergraduate body and the various details of planning that would require to be mastered, the committee suggested that 1966 should be the target for establishing the university college. It suggested immediately that a multi-racial full standard teachers’ college be set up in the Territory as soon as possible. We are proceeding to do that immediately, as we are proceeding to establish the administrative staff college. The committee also recommended plans for the provision of a higher technical training institute. We are proceeding with that. It recommended that secondary education be expanded to bring more native people to university entrance standard.
I think that that recital of the way in which this emerged, and that indication of our clear intention to link the planning of a university with all this planning, are a sufficient answer to the honorable member’s objection that we have mixed this up with matters of lesser import.
In the scant time remaining, I would like, if I may, to refer to one or two of the special difficulties that we find in the Territory. I would like to direct the attention of the House first of all to what I shall call the arithmetic of schooling. In our own community, our children have exceptional advantages, inasmuch as they come from homes where every one speaks English and where books are familiar objects, and they grow up in a community in which education is a familiar thing and in which all the surrounding influences, both cultural and social, tend to promote education. Within our own community, with those advantages, our children, starting their education at the age of six, usually require, unless they are geniuses, six years to get through primary school and another five years to get through secondary school. After eleven years of solid institutional preparation, they go to a university, and even then some of them fall by the wayside. You have the wastage rate, you have the failure rate, even with those advantages.
Although I do not contest in any way what the honorable member for Fremantle has said about what can be done in the way of pre-university preparation, I suggest that successful tertiary education requires that eleven years of solid preparation, and it is unfair to a child, particularly one which comes from a totally illiterate community, to try to plunge it into tertiary education without that solid grounding.
When this Government came to office - I do not say this in criticism of the previous government, because I know the difficulties of the war years and of post-war reconstruction during a period of confusion - the situation was that there was not a secondary school pupil in the whole of the Territory, and effective primary school enrolments were numbered only in thousands. In 1953, 1 decided, against some opposition, to inaugurate a scholarship scheme under which children in the Territory could win scholarships and come to Australia for secondary education. At the end of 1953, we searched for our first lot of candidates, and we had the greatest difficulty in finding throughout the whole Territory twenty children to fill the vacant places. Some of the first twenty children whom we picked with some difficulty to go to secondary schools in Australia, were unable, because of inadequate preparation, to complete the whole secondary school course. Since then, year by year, we have continued to give these scholarships for secondary schooling in Australia.
In the early stages of the scheme, very few of the scholarship winners - the bright boys and girls of the Territory - could get past the Queensland Junior examination level. Most of these children went to Queensland schools and scarcely any of them could get past that level. I talked personally with the headmasters of the schools which many of them attended, and the headmasters spoke in terms of high approval of the quality of these boys and girls. But they added: “The preparation is not there. They are lacking in familiarity with English, and the surrounding influences are missing. They are strained to the limit to get as far as they do.” Happily, in more recent years, we are getting very much further and more of the children are passing beyond the Junior level to the Senior level and approaching the matriculation level. The point that I want to make is that you cannot go into the jungle, pick a child - even the brightest child - and plunge it into a university. Eleven years of training is required from the time you pick the bright child in preparing it for the university with a sound foundation of education.
In the Territory of Papua and New Guinea to-day, secondary school enrolments are substantially greater. I refer here to both enrolments in secondary schools in the Territory and children attending secondary schools in Australia. In the coming years, a lot more of those children will become available for university education.
In the minute or two that I have left, I want to mention another difficulty - the difficulty of wastage. I quote these figures from memory. Each year, in administrative training course in institutions like the Post Office, the Department of Public Health and the Department of Education, which requires teachers, we have a demand for about 880 children leaving school. In the current year, we shall get only 440 of an educational standard sufficiently high to enable them to take that training. There is an enormous demand for these trainees. This is a consequence of pressure, and this is where the limiting factor is found. I ask honorable members to accept this, not as a sign of obstinacy or lack of will on my part, but as a sober fact: The greatest bottleneck in our educational system in the Territory to-day is still in primary education. We are still not getting from the primary schools a sufficiently large number of children with a basic primary education to provide the candidates for the secondary schools in the various forms of higher training that are waiting for them, or to provide candidates who will carry on academic courses and eventually qualify for university training. That bottleneck is still at the level of primary education.
This does not mean that we in any way neglect either our planning for secondary education or our planning for university education. We shall press on in both fields with the greatest possible determination. But we cannot expect children to perform miracles. We have to give them time. 1 want to contest as warmly as I can the charge that this Government has been, or that I, myself, have been, indifferent to, or satisfied about, education in the Territory.
– We do not make that charge.
– The honorable member did not make it, but it has been made in other quarters. I think that one has only to ask some of the officers whom I have bullied and instructed, and of whom I have made almost impossible demands, to know how unreasonable that charge is.
– Order! The Minister’s time has expired.
.- Mr. Deputy Speaker, I have been to New Guinea twice. I was there during the war and I have been there once in fairly recent times with the co-operation of the Minister for Territories (Mr. Hasluck). I admit that my more recent visit was only a short one. One of the features which impressed themselves on me was the strong motivation among the native people to seek education. The leaders of the tribes who themselves have not had the benefit of any education appeal for increasing opportunities to be made available for their young people.
I was surprised to hear the Minister say that the report of the interdepartmental committee was adopted by the Government on presentation. As I understand the matter, that report was supplied to the Government in August of last year, and only last week-end, after the honorable member for Fremantle (Mr. Beazley) had given notice that he intended to move in this place for the establishment of a university in the Territory of Papua and New Guinea, as far as I know, were we given the first indication that the Government proposed to establish a university there.
I want to reply to several statements that were made by the Minister. He said that people who have not been to New Guinea are probably not as responsible or as informed as they ought to be when they advance proposals such as that for the establishment of a university there. But I want to remind the Minister of the views of Dr. Turner, the Principal of the Sydney Teachers College, who recently delivered the Camilla Wedgwood Memorial Lecture at a seminar on education in New Guinea. Dr. Turner is not only the Principal of the Sydney Teachers College, which is probably the largest teachers’ college in Australia. He is also a very eminent and a worldrenowned educationist. After having inspected educational facilities in the Territory, Dr. Turner, addressing a seminar group there, made a recommendation very similar to that made by the Opposition in the terms of this proposal.
The mere ten minutes available to me make it impossible for me to delay too much over matters of detail. It seems to me that there are four good reasons why a university should be established in Papua and New Guinea immediately. First, there is a need for the university to be established to help in satisfying the aspirations of the native people to independence and nationhood. I believe that the establishment of a university in the Territory would give a big lift to the hopes of the people to obtain ultimately their independence and nationhood. It should not be overlooked that in all the newly emerging countries, the countries of Asia and Africa that have obtained nationhood in recent years, tremendous emphasis has been placed on education at all levels. It is interesting to note that in all the more enlightened reports about these developments special comments have been made about what has been achieved in the face of the most pessimistic prognostications about the results of ventures in education. I am reminded of what has been done in the educational field in countries like Malaya and Ceylon, and the country mentioned by the honorable member for Fremantle (Mr. Beazley), Nigeria. Another classic example, of course, is Indonesia. It was not expected that much progress could be made in that country, but in Indonesia to-day there are two universities, and I understand that each of them has about 10,000 students. One of those universities had fewer than 500 students in 1949.
When we talk about countries being backward, we should remind ourselves that many of these newly emerging nations have had university colleges for a very long time, some of them dating back to the middle of the last century. The new universities have in many cases evolved from those colleges.
In spite of all the pessimism, universities have succeeded in a most dramatic way in many of these countries, including Thailand, India and Pakistan. I recently read a report on university education in the Belgian Congo and Ruanda-Urundi, in which the following statement appeared: -
It has been said, with good reason, that Africa needs universities even more than university graduates. Universities have an educational and scientific mission to fulfil, and at the same time, by the formation of an intellectual elite, they are to become centres of culture.
So we saw the establishment of Lovanium University in 1949 and of the State University of the Belgian Congo and RuandaUrundi in 1955. These are in countries we have been prone to regard as very backward.
In 1943 the British Government set up a commission, under the chairmanship of the Right Honorable Walter Elliot, to report on the organization and facilities of centres of higher education in British West Africa, and to make recommendations regarding future university development in that area. The commission pointed out that the lack of literacy which was all too common in the territories visited by the commission should not be regarded as a bar to university development, and that it should be remembered that in Europe the universities began at a time when literacy was confined to a very small proportion of the population. Similar remarks apply to Australia. I think there were only two students at the University of Melbourne four or five years after its establishment. Sydney University started with 24 students in 1852. It is not necessary to have a large number of students in order to found a university.
I have elaborated on the first reason why a university should be established in Papua and New Guinea. Secondly, there is a need for this university because of the numbers of students already available. Admittedly they are mainly white students at the moment, but there are enough of them to justify the establishment of the university. We have been told of the establishment of the medical college in 1959 and of the proposed establishment of an administrative college to train administrative staff. We know of the existence of the School of Pacific Administration, which trains teachers. These are students who have matriculated before going to New Guinea. There are also the teachers we are currently sending to New Guinea in ever-increasing numbers, who have gone there with only an intermediate certificate standard of education, or perhaps a little higher, and who are expected to do a special short-term teachertraining course. All these people require, at this very moment, educational facilities to enable them to take advantage of in-service professional advancement opportunities. The proposed university could provide such facilities. By now there must also be some indigenous people approaching matriculation standard, or getting near the standard at which they could obtain the equivalent of the Leaving Certificate.
What the Opposition is suggesting is that we should abandon the old leisurely approach to this matter. We should try to identify talent among the indigenous youngsters and bring them in to the bigger centres for special training. The facilities for this higher education might be provided at the proposed university or at a special secondary school. Perhaps that is beside the point at the moment. The important matter is to identify the talent and to provide opportunities for learning at an accelerated rate. This is what is being done in many Western countries which are already well developed. The President of the United States of America has asked for an intensive campaign to identify talent, because he knows that this is the kind of thing that is done in Soviet Russia. If these steps are being taken in countries such as that, how much more necessary is it that they should be taken in a place like the Territory of Papua and New Guinea. It is imperative that we should identify the available talent and provide the best possible opportunities for nurturing that talent, so that when the university is established the indigenous people with the innate ability will be available to take advantage of its facilities. This is what we must do now. It will be too latt in four or five years’ time. We should set up a university committee immediately, so that the university can be established in time to provide opportunities for the young indigenous students who require them.
A third need for the establishment of the university is in terms of the Territory’s need for trained indigenous personnel. If the principle that we talked about in this Parliament the other night, pf selfdetermination, is to mean anything to these people, they should be enabled to govern themselves as an independent nation. They will not be able to do this unless we speed up the process of giving them trained administrators and professional people in the various spheres of activity.
A fourth need is in terms of the urgent necessity for research. We should remind ourselves that a university’s function is not only to teach but also to carry out research. The Territory of Papua and’ New Guinea cries out for research, even research in the matter of education itself. This would involve an examination of the aims and objectives of education in the Territory and the methods by which they may be achieved.
– Order! The honorable member’s time has expired.
.- I cannot help feeling that when the Opposition proposed the discussion of this matter it was not aware of the steps that the Government had already taken.
– That is right. We were not aware.
– Therefore there may not be as much controversy between the two sides of the House as might at first have been expected. The honorable member for Barton (Mr. Reynolds) says that it would be a big lift to the local people to have a university established in the Territory. He says it would give them the feeling that their national aspirations were going to be achieved. Of course there is no question about this, and it should be done as soon as possible. The honorable member says that there are already many students available who could form part of the undergraduate body. I shall deal further with that matter in a moment. The honorable member also spoke of the need for trained indigenes. I agree that there is such a need, but not only at the university level. The indigenous natives are being trained at the moment on the lower levels. The honorable member also referred to the importance of research in the Territory.
All these propositions are quite unexceptionable. The real issue is whether the Government is going fast enough, having regard to all the circumstances. The Minister set up a committee of inquiry, which I think was very well constituted, having regard to the peculiar problems of education in the Territory. It was set up in May, 1961, and reported in August, 1961. The report has been adopted, and anybody who reads the statement made by the Minister about this matter a few days ago will see that the recommendations of that committee, point by point, are being carried out as speedily as anybody could wish. I have not the time to go into the report in detail, but a study of it, and what is being done about it, will convince any reasonable person that the Government is doing all that it can.
The real question is: Has progress been unduly slow? Of course, in pre-war years progress was slow, not only in New Guinea, but also in Africa and in all the colonial territories. Australia did a particularly good job with the help of Sir Hubert Murray in pacifying the people without bloodshed. Certainly not much progress was made in the educational field, but who was thinking about these things at that time? Perhaps we were remiss, as all colonial powers were. Actually we have had only about a decade since the war in which to adjust ourselves to a new situation. We have had only about a decade in which to adjust ourselves to the great necessity to bring the people of New Guinea to the position where they can govern themselves as soon as possible.
I would like to look at the arithmetic of this in terms of education. Suppose a child goes to school at the age of six. He needs six years of primary school and another five years of secondary school, before, at about the age of 17, he is fit to go to a university. This is so in our own community, and in a moment I will say something about that. But assume that the same progress should be made - and it cannot - by the indigenes of New Guinea. It would need eleven years before enough people of undergraduate age could be produced. We have had only a decade since the war.
When this Government came into office there were no secondary schools at all in New Guinea. There had been great dis- ruption during the war and I suppose that during that period not very much was done in primary schools, either. There may have been a few missions untouched by the war. I do not know. But, in effect, we had to start from scratch at the end of the war, and we have had only a little over a decade. So, on the simple arithmetic which I have put forward it would only be now, assuming the best of conditions, which you cannot assume, that you would be able to produce any substantial number of children prepared to go on to a university. Indeed, as the Minister has said - I think none of us doubts him - it has been a matter of the utmost difficulty to find twenty students a year to go to secondary schools in Australia and to a point where three of them are now undergraduate students at universities.
Let us look at the peculiar difficulties of bringing the indigenes of New Guinea to a point where they can attend a university with any possibility of profiting from their training. I think one has to guard oneself against the pre-conceptions which we may have as members of the Australian community. In the first place, we are apt to assume that eleven years of schooling under our conditions adequately prepares a child for the university. And this is where there is no language problem; where we have good teachers in adequate numbers. I know that this may be disputed, but, broadly speaking, we have good teachers in fairly adequate numbers in Australia. Here, too, the home atmosphere is satisfactory. Perhaps the parents themselves have graduated, or the brothers and sisters have attended university. There are books and encouragement and so forth. Under these conditions in our community a child of seventeen may be fitted to go to a university. We are apt to assume that these conditions prevail in New Guinea, but they do not.
The second pre-conception with which we begin is that a child consciously desires to go to a university. As I have said, there may be all kinds of encouragement in our own community and people may understand the prize which lies before them after they graduate at a university. But is this so in New Guinea? Does a native in New Guinea understand what lies at the end of a university course when he graduates?
Does he even understand what it is all about, as the Australian does? So we have to put these pre-conceptions out of our minds.
Furthermore, we must realize that in our community in Australia only about 16 per cent, of those who enter the primary schools complete their secondary schooling and reach the stage of matriculation, if they wish to matriculate. And only about 3 per cent, of them actually graduate. This happens in our own community. You would expect a lack of understanding among the natives of New Guinea about the advantages of university education. Not only would you expect a good deal of wastage on the way, but a much greater wastage than in Australia.
I have not time to give the statistics shewing the great advances made in the school population in New Guinea, both primary and secondary - because we have to start at the beginning - nor to note the improvement in standards attained. But let us look at the question of wastage. Now there is the demand of all the departments in the Administration there. There are the demands of the Police, the Post Office and the Department of Health. There are the demands of commerce and industry and the banks, stores, oil companies and so forth, for people who are capable of becoming clerks, technical assistants, counter hands, truck drivers, storemen and so forth. Therefore of those who pass from the primary and secondary stage and may go to the university, vast numbers are drawn into the various avenues which are plain before them. They would never go on to a university. They would not dream of it with these other temptations in their way. Even in our own community how many young people who could go to the university do not, because there is a good job available down the street? How much more so is it in New Guinea? Indeed, I understand that the departments there require about 800 people each year to be trained for these various tasks which draw children off from continuing with their schooling to the university stage. One has to remember that those who wish to go to a university - even though none exists in New Guinea at the moment - are given opportunity to go to universities in Australia and to secondary schools before that.
So I think the big issue, as I said at the outset, is whether we are proceeding fast enough. I believe, when you look at the arithmetic of the situation - that it takes at least eleven years to prepare a child to go to a university, that we have had only eleven years since the war for this purpose, and that New Guinea children must suffer handicaps which Australian children do not suffer - we cannot expect the New Guinea children to reach the stage where they can go to a university as quickly as our children can. Above all, there has to be sound education in the primary stage. I suppose most of us know how difficult it is, if you have not had a thorough grounding in the beginning, to do justice to a course later on. I dare say many of us have faced that particular problem. So I believe the Government is proceeding at a reasonable pace.
– Order! The honorable member’s time has expired.
.- Mr. Deputy Speaker, the honorable member for Bradfield (Mr. Turner) said that we are proceeding fast enough. We say we are not. We say, in effect, that in the field of education and the needs of the nation to develop the skills and the capacities of its people, whether Australians or Papuans, it is almost impossible to go fast enough. Any smugness or complacency can only induce the kind of atmosphere which produces no results at all. This is the point which has escaped the Minister for Territories (Mr. Hasluck).
I was surprised that the Minister, at the beginning of his answer to the honorable member for Fremantle (Mr. Beazley), showed the kind of chauvinistic attitude which he has brought to the administration of the Territory. Despite that, he has done much more for the Territory, I believe, than any other member of the Cabinet would have done. There is a lot to be learned from the other nations of the world and there is much that Australia can gain from examining how other people have attacked this same question. In certain fields the problems of Papua are different from and more exaggerated than those which we would find in the darkest parts of Africa. But these people have had similar experience. If we are looking for people from whom to get guidance, experience and example, surely there is no harm in turning to the people of Africa. There, again, we have the great advantage of our membership of the Commonwealth of Nations. The British people have faced this problem and have tackled it. As long ago as 1945 the British Government appointed the Asquith Commission. Its report reads -
In the interests of higher education in the Colonies, it is essential that universities should be established at as early a date as possible in those areas which are not now served by an existing university. The immediate objective is to produce men and women who have the standards of public service and capacity for leadership which the progress of self-government demands, and to assist in satisfying the need for persons with the professional qualifications required for the economic and social development of the Colonies.
We say this is a case for a dynamic and not a pessimistic approach. I think nobody on this side of the House or elsewhere in the Australian community would charge the Minister with indifference. But I say he is pessimistic and conservative.
That is why we of the Opposition set out in the first instance to offer our views and give whatever support we possibly can to the Government in tackling this problem. After all, it is essential that the Government should have Australian people behind it if it is to be successful in this venture. If it is to embark on a university plan for the Territory of Papua and New Guinea it will be embarking on something that will cost millions of pounds and not just a few hundred thousand pounds in a few years.
– We are spending over £3,000,000 a year now.
– On the university?
– No, on education.
– The report on the University of Malaya, which set out the programme in 1948, in the days before the inflation of the Menzies Government, stated that the initial foundation costs would be upwards of about f 2,000,000 sterling. The report sets out all particulars of cost. We believe that the Government is being unduly cautious in each of these fields.
The honorable member for Bradfield (Mr. Turner) said that there were many difficulties, and he outlined a number of them. For instance, he said that the scheme entailed eleven years of schooling, that we needed a background of social atmosphere and so on in the community, but we on this side say that the university itself is part of that social atmosphere. There will be no demand by the Papuan people for a university as such unless they can actually see there is one somewhere at hand. If getting a university education means leaving their homeland, if it means going overseas among strange people, there will not be that kind of demand from the people of Papua. I have visited the Territory of Papua and New Guinea, and I hope to visit it again in a few weeks’ time. I was a teacher for many years. As a teacher, I worked in different parts of Melbourne and Victoria and could see how the social atmosphere urging children on to a university education differed from suburb to suburb. Where the parental background and the local social atmosphere were such that children necessarily thought of a university as part of their way of life, there was no difficulty in keeping them at school, but in areas where a university belonged to a different world, whether socially or geographically, there was great difficulty in keeping them at school after they attained fifteen or sixteen years of age. So, we of the Opposition believe that it is absolutely essential for the atmospherics of Papua and New Guinea that the university be established there. In these days we live in a world in which, I am afraid, we think in terms of what one might call massiveness. Everything has to be done on a large scale; the daily newspapers must have a circulation of 500,000; budgets must run into hundreds of millions of pounds, universities must have 10,000 students, and so on. Why, when the University of Melbourne opened in 1855, it had only seventeen students. Even 24 years later, it had only 263; and in 1900, just 45 years after its foundation, it had only 531 students. So we believe that the atmosphere created by the university itself would be an important contribution to the development of the Papuan morale. I think it is essential that the university be established there. I belonged to an age group and a social group to which the university was a strange world. When I attained young manhood in a high school in Victoria at the beginning of the depression years, I did not even look upon a university as being part of my future. It was my great good fortune to come back from the war and be able to go through the university as a student under the Commonwealth Reconstruction and Training Scheme. But my boys are growing up in a different atmosphere. They look upon university education as one of the benefits they ought to have. Whether or not they make the grade, of course, is a matter of personal ability. The important fact is that there has been a change in my own social background and that of my own family. That change was created not so much by the social accessibility of the university, but by the sight of it, by the knowledge that it was available to me - what I might term its geographical accessibility.
In Papua, what is required is not only social accessibility but also geographical accessibility. So we of the Opposition believe that something should be done to make the opportunity available to the extent suggested1 in the proposal we are advancing. I personally would support the view that the head-quarters of the higher education scheme ought to be established in Papua. For instance, it might not be a bad idea if much of the work of the School of Pacific Administration itself were done there. The people who are now sent to the medical school at Suva - I presume there are still some there - should be trained in Papua.
– They will be trained at Moresby in future.
– Yes, at the Moresby Medical School. I think it is a matter of the creation of the atmosphere as much as anything else. My examination of this Government’s activities over the last twelve or thirteen years leads me to believe that unfortunately it often took very hesitant steps where it ought to have been bold, progressive and dynamic. As an example of what should be done I point to the Australian National University at Canberra. It did not start with students; it had only fellows, readers and academics of that kind. Therefore, we demand - and I believe that we on this side have the support of the people of Australia in making this demand, just as the Minister himself would have the support of the people if he accepted our view - that the education system of the Territory of Papua and New Guinea should be stimulated in all possible fields.
The honorable member for Bradfield, and I think the Minister himself, referred to the background of the people from among whom the students will come. They do not have books, they do not have newspapers, and they do not have radios. This again is part of the social pattern which the Government has failed to develop. Working conditions in the Territory ought to be such that the people are enabled to have radios. I do not know whether radio communications have been improved in the last two or three years, but in the past they have been very unsatisfactory. The wireless station there was too low powered. I understand that a recommendation was made for the publication by the Government of a daily newspaper. This was mentioned rather vaguely in the House on one occasion, but the Minister did not favour iti He said it was not a field for government intervention. In my view the Government should, by its own actions, have improved communications in the Territory in all fields.
In this debate we are not so much preferring criticism as offering suggestions. I think it was unfortunate that the Minister got away to the kind of start he did when he entered the debate. We are offering support, encouragement, and, I hope, optimism in relation to this question. Whether people come from Indonesia, India or Nigeria, human capacities are much the same. Whether people be black, brown or white, their human capacities are there to be developed. Their capacities are awaiting development whether their background has been one of unbridled savagery or the more sophisticated savagery of European civilization over the last few hundred years.
– Order! The honorable member’s time has expired.
– I do not think that any one who is interested in this subject will disagree in principle with the proposal submitted by the honorable member for Fremantle (Mr. Beazley). I myself would heartily agree that the establishment of a university for the purpose of providing an intellectual centre and a driving force for any Territory or any community that can sustain it is an excellent project. The only point on which there would appear to be any great difference between us is whether now is the right time for the establishment of a university in the Territory of Papua and New Guinea or whether the Minister is correct in stating that we must lead up to it by a series of moves designed to give us the materials necessary to enable us to have a properly functioning university. That is a most important consideration.
For many years now I have watched the evolution of the control of our Territories and while I would not suggest for one moment that the present occupant of the office of Minister for Territories (Mr. Hasluck) has not made mistakes - I do not want to convey the impression that I think he is sprouting wings or anything like that, because it is human to make mistakes if one is to do anything - I believe that this country has been singularly fortunate in having as the Minister for Territories such a man of culture and broad outlook, a man who has the courage of his convictions, a man who has carried forward a programme such as we have never had in this country before. I think we all can pay that tribute to the present occupant of the office of Minister for Territories even though we may differ from him on points of detail.
Let me give briefly my own experience which, after all, has been fairly wide. At one stage of my career in New South Wales, I was very gravely concerned at what I believed to be a great problem. I refer to the wastage of human material between the time of leaving the secondary schools and point of entry to the universities. I instructed certain expert officers to carry out an investigation. We took, for example, 20,000 entrants into the crack boys high schools of Sydney and we traced their careers through until they came to the point of entry to the university. No boy was’ admitted to these schools without a pass of 70 per cent, or 75 per cent., gained in strong competition. That was the standard which was set for entrance to these schools. There was a certain wastage at the first year but that was made up by the cream of those who came from intermediate high schools and who had shown exceptional promise. Of the 20,000 who started in these high schools only about 2,000 entered the University of Sydney.
I am quite prepared to admit that certain factors were operating, but even if we allow for entrants to technological courses at Sydney Technical College this pin-points how difficult it is to gain the requisite number of students for entrance to a university. It is true that some drop out for financial reasons, but, taking all facts into consideration, it is difficult for the universities to get more than 15 per cent, of the total of secondary school students who are capable of completing a successful university course. I was not able to have a further check made, but these were dramatic facts at the time that they were discovered. They have a very great bearing on what we are discussing at the present moment. It is impossible, in this short space of time, to deal with comparative statistics. To use statistics which do not have relationship to something that they are intended either to prove or disprove is a waste of time. However, I shall give a few statistics which I have culled from a report on native education in Papua.
In 1938-39, as far- as I can ascertain, direct and indirect expenditure on the education of natives in Papua amounted to £5,316. This was expended on 3,320 children in 80 schools. By 1948-49, the expenditure had risen to £145,000 and the number of pupils had risen to about 38,000. By 1959-60, expenditure had risen to £672,500 on 64,500 pupils. In addition, £107,400 was paid by the Administration to assist missions to provide education for natives.
It cannot be stressed too often that unless children are given the necessary basic training at the pre-school, primary and secondary levels, university enrolments will suffer. If this principle applies in the Australian community with all its advantages, how much more does it apply to a primitive New Guinea community? One of the greatest factors in the child’s life is its home environment. If a mother is a graduate or has passed the leaving certificate how much more chance has her son or daughter of making a success of his or her secondary schooling and career than the child of entirely illiterate parents?
A visit to native villages - I have made such visits from time to time - reveals that the real problem is the effect of community environment as well as home training by parents. My first conclusion, after visiting those villages, was that it was necessary to lift the daughters of native families to a level equal to that of the sons before it would be possible to get a really solid basis of education. While the community environment of the Territory natives is as primitive as that of our British ancestors who went around in blue paint and bear skins and lived in little villages, this factor will constantly impede the progress of the native people. While I support in principle the proposals of the honorable member who initiated this debate, I stand solidly by the programme put forward by the Minister for Territories. I believe that that programme is progressive, realistic and imaginative and has regard to the environmental factor.
– Order! The honorable member’s time has expired.
Motion (by Mr. Hasluck) agreed to -
That the business of the day be called on.
Message recommending appropriation reported.
In committee (Consideration of GovernorGeneral’s message):
Motion (by Mr. Fairhall) agreed to -
That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to provide for the payment of a bounty on the production of sulphate of ammonia for use in Australia as fertilizer.
Standing Orders suspended; resolution adopted.
That Mr. Fairhall and Mr. Roberton do prepare and bring in a bill to carry out the foregoing resolution.
Bill presented by Mr. Fairhall, and read a first time.
– I moveThat the bill be now read a second time. When tabling the tariff proposals relevant to the report of the Tariff Board on nitro genous fertilizers last week, I stated that the Government had adopted the board’s recommendation for a bounty on sulphate of ammonia. The bill now before the House is designed to put this decision into effect. In line with the board’s recommendation, the bounty will be paid to Australian producers of sulphate of ammonia at the rate of £2 per ton on domestic sales of sulphate of ammonia for use in Australia as fertilizer. The bounty is to operate for three years as from 1st April, 1962, and an annual limitation on payment of £225,000 is prescribed. The cost of the measure is estimated at about £200,000 a year.
The Tariff Board concluded, on the evidence before it, that a profit limitation is unnecessary in this case. Nevertheless, an unforeseen material change during the course of the bounty might conceivably result in the producers receiving a higher rate of profit than is at present expected. The Government has decided, therefore, that the proposed legislation should contain the 10 per cent, profit limitation provision usual in other bounty legislation.
Sulphate of ammonia is the only synthetic nitrogenous fertilizer produced in Australia at present. Australian production is approximately 100,000 tons a year. About half of this production is sold to primary producers as straight fertilizer and the balance, except for a small quantity used in industry, is sold in mixed fertilizers. The major demand for sulphate of ammonia has been for sugar cane production.
The Tariff Board found that the continued production of sulphate of ammonia is desirable because it gives employment to 400 people and it uses industrial byproducts which otherwise would be wasted. Capital used in the industry is about £3,000,000. The Government believes that the proposed bounty will offset the industry’s competitive disability in relation to imported sulphate of ammonia and will have a beneficial effect on the price to primary producers. It expects that the price of sulphate of ammonia will fall to somewhere near the 1960-61 level. The question of further assistance to the industry will be examined by the Tariff Board before the bounty expires. I commend the bill to honorable members.
Debate (on motion by Mr. Pollard) adjourned.
Debate resumed from 10th April (vide page 1501), on motion by Mr. Harold Holt-
That the bill be now read a second time.
.- My colleague, the honorable member for Macquarie (Mr. Luchetti), indicated yesterday on behalf of members of the Australian Labour Party our intention to oppose this measure. We are doing so, not because we want to hinder the development of the Snowy Mountains Hydro-electric scheme, since in fact it was a Labour government which began that magnificent venture. The basis of the Australian Labour Party’s objection to the proposal is that there is no need in the current circumstances in Australia for the Government to borrow the money required in the manner proposed in the bill. I direct the attention of honorable members to the following extract from the secondreading speech of the Treasurer (Mr. Harold Holt) on this bill:-
While most of the expenditure on the project will be in Australian currency, the loan will be drawn in such foreign currencies as are agreed between the Commonwealth and the bank.
We believe that basically the work that has been undertaken so far in the Snowy Mountains scheme and that remains to be done has relied and still relies mainly upon the man-power available in Australia. This scheme requires technical skills and manufacturing capacity available in Australia. Only to a limited extent is it necessary to import capital equipment at all. The words of the Treasurer seem to bear out that contention in the current circumstances. In addition, even if it were necessary to import some components of capital equipment, Australia’s international reserves at present are sufficient to permit payments to be made as required.
As the honorable member for Macquarie pointed out, we had a rather absurd situation only recently. Australia, having availed itself of borrowings to the extent of 175,000,000 dollars, or £78,000,000, repaid the loan without having drawn on it. Almost at the same time as that repayment was made, we are preparing to borrow £44,700,000 in Australian currency or 100,000,000 dollars at a rate of interest considerably in excess of the previous borrowing. At least on the surface and on that basis this transaction is, to say the least, rather crazy.
It has been suggested that the interest rate of 51 per cent, on the proposed loan compares with the rates already payable on money that has been used for the Snowy Mountains scheme. The rate that is being charged in connexion with that scheme at present is purely a book-keeping entry because for the most part moneys that have been mad’e available for the Snowy Mountains scheme in Australia have been payable out of Commonwealth revenue. They have not related to loan moneys at all and the rate of interest that has been struck has been designed purely to make the price of electricity provided by the scheme competitive with that produced under other Australian projects. These are State undertakings for the most part, and there is very little validity in that kind of argument. Therefore, the Australian Labour Party opposes the bill on those two grounds. There is the third ground that I shall explain in a moment.
We oppose the measure because, for the most part, the work that is envisaged will be financed in Australian currency anyway, and there is no need to borrow for most of it. As I have said, the Treasurer has stated that most of the expenditure on the project will be in Australian currency, but he does not say what proportion he has in mind. However, our external reserves at the moment are adequate to pay for any work as the expense is incurred.
That is one side of the argument. The other side is this: Last night the honorable member for Bruce (Mr. Snedden), when speaking on this measure, referred to the fact that 57 countries were members of the International Bank for Reconstruction and Development. Therefore, he said, there were 57 potential borrowers. Of course, the honorable gentleman did not say - or did not know - that there are also 57 potential lenders because everybody who joins that bank makes a subscription in the member’s own currency which can be used by any other member of the bank. We members of the Australian Labour Party believe that when the Labour Government gave its sanction to Australia joining the International Bank for Reconstruction and Development it had in mind that Australia would not be one of the principal borrowers from the bank, and that loans would be made to less fortunate nations. Basically, the problem that bedevils international relations to-day is that something like onehalf to two-thirds of the world’s population have a standard of living that other fortunate sections regard as deplorable, and it is the countries in which those people live that require reconstruction and development.
We believe that basically - and this project under consideration is a good example - Australia can encompass most of its essential development from its own resources; that borrowing should be a last resort rather than, as this Government makes it, an easy escape out of facing up to more fundamental problems. Therefore, for reasons of that sort, we oppose this measure.
Any honorable member who cares to read the last available annual report of the International Bank for Reconstruction and Development - which is the sixteenth annual report, that for the year that ended 30th June, 1961 - will see there, given in summary form, the transactions of the bank. The report shows that last year the new lendings of that institution were of the order of 700,000,000 dollars. When you take into account the economic problems facing something like 2,000,000,000 people in the world to-day you can see how inadequate are sums like 700,000,000 dollars to bridge the obvious deficiencies that exist. The longer that countries like Australia continue to be borrowers rather than lenders in that institution the more does the disparity between the haves and the have-nots grow unfavorably as against the have-not areas.
We believe that there are many projects like the Snowy Mountains scheme which are necessary in other parts of the world and to foster which Australia could provide some of the technical and practical equipment necessary. Also, the Australian currency which is available in the International Bank and in the International Monetary Fund could be used to enable the countries concerned to pay for the projects over a period.
It is sometimes said that one of the reasons why Australia cannot build up markets in the areas adjacent to us - and there are more than 1,000,000,000 people at our doorstep - is the lack of purchasing power of countries in those areas. Expressed in the terms of humanity it is not a very fine commentary on our attitudes that we are worrying about losing the market represented by 200,000,000 people when we have a potential market of 1,000,000,000 people much closer to us; but, of course, in terms of economic reality, those people close to us do not yet have the purchasing power in their pockets - most of them do not even have pockets - to enable them to pay for the goods that we could supply. One of the reasons for that is that they have not yet moved out of their almost feudal agricultural state into the first stages of light industrial development. Until something is done to shift some of these people from primitive agriculture into the beginnings of industry we will not be getting very far towards bridging the existing gaps. That is where institutions like the International Bank and the other agencies that have recently been developed under its aegis - the International Development Association, for instance - can provide assistance so that the plight of those countries can be remedied.
I should think that under the present Government Australia has been most deficient as a member of this institution, the International Bank for Reconstruction and Development, in that, so far as I am aware, in the whole period of the bank’s existence not one of those countries round about us - and many of them are among the 57 potential borrowers of whom the honorable member for Bruce spoke - has wanted to avail itself of any of the Australian currency in the fund and available to them if they undertake the requisite negotiations.
Surely it is competent for industry in Australia to make available, let us say, heavy earth-moving equipment, to enter into contracts with Indonesia, Malaya, Borneo and some of those other countries that need such equipment but cannot get it at the moment because they are short of Australian currency. It has been pointed out in this House before that in some instances contracts have been lost by Australian manufacturers merely because of the terms of credit available to the potential buyers who, instead of buying in Australia, have bought in the United States of America or Great Britain because those countries offered them better credit facilities for the particular transactions. So, as I say, we believe Australia has been deficient as a member of the institution by not doing something to see that such transactions were encouraged.
We believe also that the present Government has been deficient in that until recently, because of its actions, Australia was the biggest single borrower from the International Bank in the whole history of the institution. India has now taken that place from Australia, but at least India, a country of more than 400,000,000 people, has a higher claim to be a big borrower from the institution than Australia has, because whatever we may feel our problems of growth and development are, India’s problem’s are of much more significant stature, and there is much more fundamental poverty to be remedied in that country than exists in Australia.
Over a period Australia has made the following borrowings from the bank, which are tabulated in appendix K of the sixteenth annual report: -
This comes to a total of borrowings to 30th June, 1961, of 317,730,000 dollars, and now it is proposed to add 100,000,000 dollars to that total. Some has been repaid to the bank. Also, of course, we have had transactions going on in the bank involving, sometimes, the sale of Australian loans to private bond investors. This happened to the extent of 106,000,000 dollars out of that total of 317,730,000 dollars.
For all those reasons the Opposition opposes this measure. I repeat the reasons: That because, for the most part, the borrow ing is to be in Australian currency, there is absolutely no warrant for borrowing at all; and that what is borrowed is not going to be used to further the purposes of the Snowy Mountains scheme at all, and is to further other economic expenditure which is not the subject of this bill.
– Balance of payments!
– Again, it is the old question of the balance of payments problem. The major part of the 100,000,000 dollars will not be used to further the Snowy Mountains scheme but will enable individuals in Australia to import from dollar areas and other areas goods which are not specified in the bill. The honorable member for Bruce said that the bill gives the details of how the money will be expended. Details may be there, but the really significant point was contained in the words of the Treasurer, who said that most of the loan will be in Australian currency. It will not be foreign expenditure at all. That part which is foreign has not been mentioned in any detail by the Treasurer. The second objection is that Australia’s reserves are adequate at the moment even for that undisclosed part to be paid as we want it.
Then there is what might be called the moral side. As was pointed out last night, the total resources of the institution are limited. The more that Australia takes from these limited resources, the less there is available to other nations whose needs in terms of economic necessity are much greater than are Australia’s. From time to time we hear pious utterances from honorable members opposite about the growth of communism and other ideologies in Asian and African countries and other parts of the world. These ideologies gain strength in those countries only because economic misery is allowed to continue. Unless the economic malaise of these countries is relieved in a systematic fashion, it is likely that political events will move faster in directions that we do not like.
The Western world has had a long period in which it could have shown a better understanding of the economic condition of these countries. We are now in an era that is sometimes rather grandly described as an era of rising expectations. People in the countries I have mentioned can see what is available in other parts of the world and they are beginning to ask why it is not possible for these things to be available to them. They are more disposed to pay attention to economic assistance, from whatever direction it may come, than to engage in philosophical arguments as to whether democracy, totalitarianism, guided democracy or some other political system is to be preferred. Basically, these people are not interested in matters of philosophy at this stage. If we examine our own history, we will find that in the times when most of the population was in a state of economic serfdom the community as such was really not interested in the sort of political institution that the country had. Only as the standards of the lower sections of the community were improved and their more immediate economic wants were satisfied did the country begin to have a fine flowering of political development.
I suggest that more attention be paid by those who claim that they want to preserve the Western way of life to the economic problems of the under-developed countries. This Government ought not to become one of the most greedy borrowers from the international lending institutions. It should encourage the institutions to do what they are supposed to do and that is to reconstruct and develop where reconstruction and development are primarily necessary.
On this occasion we oppose this measure because we believe that it shows the Government has failed to face up to the fundamental problem internally, that is, the question of foreign borrowing, and to the fundamental problem externally, which is the fact that to-day the great majority of mankind lives neither in opulence nor affluence but in many instances at the level of degrading poverty.
.- The honorable member for Melbourne Ports (Mr. Crean) opposes the bill on two grounds. First, he opposes borrowing from overseas. This, after all, is a recent addition to the policy of the Australian Labour Party. The second ground of his opposition - this is rather extraordinary - is that the loan will deprive more needy countries of funds necessary to bring about a higher Standard of living in those countries.
I shall endeavour to answer the second point first. The honorable gentleman rather compliments the Government if he believes that our circumstances are so good that we have no right to borrow from this fund to which we have contributed. He allies us with the most prosperous nations in the world when he puts us in this class. I suppose he would put us on a par with the United States of America, Great Britain, Western Germany and other similar countries. Probably we would be surprised if those more wealthy and more fortunate nations borrowed from the International Bank, but we are in a different position. We are in a transitional stage. We are ceasing to be solely a primary-producing country and are becoming also an industrial country. Many stresses have been put on our economy.
There is another factor. I suggest that a loan such as this for the purposes which we have in view will put us in a better position to aid the more backward countries, particularly those of South-East Asia. We play a very great part in the sharing of responsibilities under the Colombo Plan. I believe that, in some respects, in our contribution to the defences of Asia, we play a part far greater than is justified by our resources. We have our responsibilities under the South-East Asia Collective Defence Treaty and other defence arrangements in that part of the world. For this reason, Sir, I believe that some of the remarks made by the honorable member for Melbourne Ports may be dismissed.
I turn now to the honorable member’s first point - the Australian Labour Party’s opposition to borrowing from overseas. This is the more recent tradition of that party. If we look back 40 years or more we find that in those days the Australian Labour Party was a tremendous borrower from overseas. I call to mind Mr. Holman, a Labour Premier of New South Wales a little more than 40 years ago, who, I think, held the record for borrowings from overseas. I recall that in my own State, Queensland, American dollars were borrowed at rates of interest as high as 8 or 9 per cent. However, the Labour Party has undergone a tremendous change since those days. It has embraced international socialism and, of course, its policies have changed. The remarks made yesterday by the honorable member for Macquarie (Mr. Luchetti) were indicative of that. He suggested that the Chifley Labour Government was able to borrow tremendous sums overseas. I think he said that that government borrowed abroad a total of more than £1,000,000,000. However, the honorable member must allow for one factor which ought to qualify his remarks in relation to overseas borrowings by the Labour government. When it first held office, we were at war. After the war, under the close financial grip of the Australian Labour Party, Australian investors had available no sources of investment other than government loans. They had no choice in the matter.
– You did your best to escape lending for the Commonwealth loans.
– It is all very well for the honorable member to make such a remark, but he cannot escape from the fact that the only avenue of investment available was Commonwealth loans.
– When was that?
– The time of the Chifley Government.
– There was a war on then.
– I am not talking of the time when there was a war on. I am talking of the time after the war when one could not invest in anything but Commonwealth loans. I know that Opposition members do not like that to be recalled, but it is a fact.
I support this bill, Mr. Deputy Speaker, and also the Government’s very wise policies in regard to the Snowy Mountains scheme. This scheme could be financed in a number of ways. The first of these ways is the printing and issuing of bonds, which, I know, is very attractive to honorable members opposite. But we would have been in a disastrous position to-day had that been done. I have no doubt that had it been done we would not have been able to gain the confidence of the International Bank for Reconstruction and Development and induce it. to lend us this money, because, as every one knows, we would have had galloping inflation.
Another way of financing the Snowy Mountains scheme would be to find the money from revenue - from taxation. That was absolutely necessary when this Government inherited the scheme from the Labour Government. I give the Australian Labour Party credit for having initiated the scheme, but it had not completed the project when this Government took office. However, we inherited from the Labour Government not only this scheme but also a tremendous surge of inflation. There came upon us a tremendous boom in the price of wool, and enormous sums were available to the community for spending. Some of that money had to be directed elsewhere. A temporary wool tax was introduced in an attempt to keep some of that money away from the community and prevent a further surge of the surplus money towards spending on labour and materials.
– That was not a wool tax. It was a wool sales deduction.
– I thank the honorable member for Mallee for that information about the name which was adopted. All the wool-growers, I think, approved of that measure. Although they were not very happy about it at the time, they realized the wisdom of it. The economy was very buoyant at the time and we endeavoured to prevent, and did prevent, inflation from getting completely out of hand.
Another way in which to finance the Snowy Mountains scheme would be to borrow money locally. By that means, to a degree again, we would prevent inflation. If that means were adopted, money would be taken from the community and the individuals who lent the money would not be able to compete so strongly with the Snowy Mountains project for labour and materials.
A fourth method of financing the scheme is that which we have adopted on this occasion by borrowing from overseas. By borrowing overseas, we bring new money into our community. Borrowing within our own community is like a man borrowing from himself. He takes money from one pocket and puts it in the other, and then writes an I O U to put in the pocket from which the money was taken.
– That is a weak observation.
– No. That is a fact in relation to borrowing within Australia. A man who takes money from one pocket and puts it in the other may feel well off, because he has afterwards an IOU - something that he did not have before.
On this occasion, we are borrowing from overseas to help finance the Snowy Mountains scheme. It may be said that this is more inflationary than local borrowing would be, because local borrowing would prevent some of our own citizens from embarking on schemes of their own for which they would require additional finance.
– Why does not the honorable member admit that we are placing ourselves in pawn?
– Apparently the honorable member does not look very deeply into these economic factors. He is just like the rest of the members of the Australian Labour Party to-day. They are completely unimaginative and fail to think on the right lines.
I have stated the facts, Mr. Deputy Speaker. This Government has in view tremendous schemes and plans for the development of Australia. I know something of what is envisaged in Queensland. I visualize the expenditure of hundreds of millions of pounds in that State. If members of the Australian Labour Party really think that we have in Australia enough funds to develop not only Queensland but also Western Australia and the rest of this country, they ought to think again. Borrowing overseas can be prevented, of course, if we put the clamps on our economy, as the Australian Labour Party attempted to do under Mr. Chifley. The Labour Government attempted to clamp down on free enterprise and leave room only for government enterprise. That is the policy of honorable members opposite. All these things fit in like pieces of a jig-saw puzzle, but the puzzle is not a very complex one.
This is a wise measure. The world bank has approved of this borrowing. It has approved of this scheme to develop the Snowy area. It realizes that it is an economically sound scheme. The honorable member for Melbourne Ports said that we are depriving people in the more backward countries of money. I do not think we are preventing them from undertaking developmental schemes by depleting the funds available from the world bank. I would suggest that if those countries are unable to secure finance from the world bank for developmental projects it is simply because the bank considers those projects uneconomic. It is obvious that officials of the world bank came to Australia and made a very thorough examination of the proposed works, and that the bank then approved of this borrowing.
The honorable member for Melbourne Ports said that the money will not be used on the Snowy Mountains scheme. What utter nonsense! When this loan was negotiated, many effective safeguards were insisted upon by the bank. The money was advanced on the prospects of economic success of the Snowy Mountains scheme. As far as paying it back is concerned, we have excellent prospects. We have made very good progress with the scheme and have now practically reached the half-way mark in expenditure on the project. The United States of America has had wide experience of projects such as this. It has, for instance, completed a somewhat similar undertaking through the agency of the Tennessee Valley Authority. Using the experience of that country as a guide, we may expect that during the term of this loan we will obtain £30,000,000 of new wealth from irrigation alone. At the same time, of course, we will obtain some income from the sale of electricity.
This scheme has been criticized by honorable members opposite. I must correct myself: Honorable members opposite are not criticizing the scheme; they are criticizing the obtaining of an overseas loan. However, we occupy a very important position in relation to our northern neighbours. We must be a strong nation so that we may help the people in the countries to our north. We must be able to supply goods to them and help in their development, so that they may attain a reasonable standard of living. We can put ourselves in such a strong position only by developing areas such as the Snowy Mountains area.
I know that this scheme will provide agricultural opportunities in many new areas by increasing the amount of water available for irrigation, but this is not the most important aspect of the irrigation side of the scheme. It is most important that we safeguard existing agricultural activities. This scheme affects three Australian States. There is a further scheme for a dam at, I think, Chowilla, to preserve water supplies for South Australia, a State which is plagued with poor rainfall. South Australia has tremendous industrial development and it is most necessary that its industries be safeguarded.
For all these reasons I have great confidence in the scheme and I have very much pleasure in supporting the bill.
.- A most amazing gentleman has just resumed his seat. He objected to the Labour Government, under Mr. Curtin and Mr. Chifley, using the resources and man-power of this country to meet the needs of war when the enemy was at our gates. He asked what the Labour Government did. It monopolized the loan market and it prevented private enterprise using the available money in the hour of danger of the community for the purpose of making huge profits. However, while the honorable member for McPherson (Mr. Barnes) may be amazing, this whole Government is quite incomprehensible on matters concerning loans. In April of 1961 the Australian Government made a drawing or a borrowing of £78,000,000 from the International Monetary Fund. That money was drawn or borrowed for a period of from three to five years at an interest rate of about 2 per cent. Recently that loan was repaid. It was not being used for the purpose for which it was borrowed, and so it was repaid. Some time ago I asked the Treasurer (Mr. Harold Holt) whether packaged peas coming from Holland were being paid for out of the amount of 40,000,000 guilders borrowed from Holland, and the right honorable gentleman said that there was no connexion between the two transactions. He said that the 40,000,000 guilders were to replenish our overseas funds. What happened, of course, was that the peas were paid for out of our overseas funds and the guilders replenished our overseas funds. Yet the Treasurer tells us that there was no connexion between the two transactions.
The point I make is this: We had £78,000,000, which we could use, at an interest rate of 2 per cent., to replenish our overseas funds for three or four years. Yet we borrowed 40,000,000 guilders, or £4,900,000, from Holland at 5 per cent, to replenish our overseas funds. To me this is incomprehensible.
Now we come to discuss another loan. The Treasurer seeks approval for the borrowing of 100,000,000 dollars, or £44,700,000, from the International Bank for Reconstruction and Development. The object of this loan is to carry out a portion of the Snowy Mountains scheme. The Treasurer said -
The works to be undertaken include the construction of three dams, two long tunnels, a pressure tunnel and twin steel pressure pipelines to carry water to the power station. . . . The total estimated cost of these works is about £92,000,000.
The loan is repayable in 25 years and the interest rate is 5f per cent. In attempting to justify the borrowing, the Treasurer says that the loan will add immensely to the productive potential of Australia. But, as has been pointed out by the honorable member for Macquarie (Mr. Luchetti), this is not the commencement of the Snowy Mountains scheme. The scheme was started by a Labour government, and £181,000,000 has already been spent on it in the building of dams, tunnels, pipelines and other things of the kind that this loan money will be used to construct. Not one penny of loan money has been raised to carry out the works already completed. They were financed from revenue.
I think it was the American Declaration of Independence, Mr. Deputy Speaker, that started with the words, “ Longestablished practices should not be changed for light or transient reasons “. What are the weighty reasons that caused the change from the practice of financing the Snowy Mountains scheme out of revenue to the system of financing it from loan money? Is the Government financially embarrassed at the present time and must it raise loans? The Government denies that assertion and says it is not financially embarrassed. It has reduced both direct and indirect taxation just recently. Is it because the whole system of financing the Snowy Mountains scheme out of revenue was a bad scheme?
– The honorable member says that it was not. If it was a bad scheme let the Treasurer (Mr. Harold Holt) get up and say that all along he should have been financing this scheme out of loan moneys and not out of revenue. If, however, the Government is embarrassed, or if it is better to finance this work out of loan than out of revenue, why stop at £44,700,000 when the work to be carried out is to cost £92,000,000? Why not borrow £92,000,000? No! The Government does not do that. And, of course, borrowing at home for this work is not more advisable than it is to carry on the work with moneys from revenue.
There may be people who disagree with me upon that issue. I will not argue very strongly against them. But I will argue very strongly against those people who say that it is advisable not merely to raise a loan but to raise that loan overseas. And that is what this Government intends to do. It intends to raise a loan overseas. What does that mean? It means that the loan will have to be repaid and that £44,700,000 will leave this country for the purchase of goods overseas, for the loan must come in in the form of goods. In addition, on this loan at 5J per cent, over 25 years, more than £50,000,000 will be payable as interest. Furthermore, while the £44,700,000 goes out of this country in order to buy goods overseas, there are 100,000-odd Australians unemployed and industries in this country are stagnating. As I pointed out, £50,000,000 will go out of this country to pay interest, and it will go in the form of goods. Nothing comes to this country in return for that £50,000,000. This Government stimulates the industry of other countries. It provides employment for the people of other countries of the world but neglects to provide employment and to stimulate the industries of Australia.
– That is the very purpose of the loan.
– I will point out exactly what the loan will do. As I have said, it adds to our overseas obligations. It adds £50,000,000 to our interest commitments. It adds £2,000,000 a year to our commitments overseas. What are those commit ments? Are our commitments overseas so few and so light that the Government can say, “What does it matter - another small sum of £2,000,000 added to them? “? 1 have gone to the trouble of obtaining a document and I would like to incorporate it in “ Hansard “, but I know I cannot. Therefore, I will content myself with reading out the salient points. It sets out the loans that have been raised by this country since 1948.
Since 1948 we have raised loans of 315,000,000 dollars, or £141,000,000 in New York. From the International Bank we have raised 317,700,000 dollars or £141,800,000, exclusive of the present 100,000,000 dollars. We have raised £126,000,000 sterling or £158,200,000 from the United Kingdom. We have raised 240,000,000 Swiss francs or £24,800,000 from Switzerland. We have raised 35,000,000 Canadian dollars or £15,100,000 from Canada. We have raised 40,000,000 florins or £4,900,000 from the Netherlands.
In 1948 our overseas debt was £520,700,000 and to-day it is £725,000,000. In 1949 our annual interest liability was £18,100,000 and it is now £30,900,000. In 1949 our compulsory sinking fund was £500,000 and to-day it is £18,100,000. The position is that our overseas obligations which have to be met every year have increased from approximately £18,000,000 in 1949 to £49,000,000 under this Government. Our drawings from the International Monetary Fund were £9,000,000, £13,000,000 and £78,000,000. Those figures show the position that this Government is getting this country into.
I agree that there may be times when it is desirable to borrow, but the time when it is desirable to borrow is not when the country is already finding difficulty in meeting its commitments overseas. The Government’s difficulty in meeting its commitments overseas is shown by the position that confronts it every now and then in the repayment of loans. If, in addition to that, we have to pay out about £150,000,000 annually in dividends on overseas investments, that becomes a portion of the cost structure of this community. I listened, just the other day, to the Prime Minister (Mr. Menzies) who said -
At our national peril we must not cost exports out of their markets.
Included in the cost of any article are the overhead costs of the factory, interest being paid on loans, and dividends being paid to shareholders. Insurances and freights are also added to the cost structure. Last year, Australia paid £403,000,000 in such invisibles as freight, insurances, dividends and interest. All that, of course, went into the cost structure of this community. The Treasurer told me that the cost of those commodities that were coming from overseas, and which he said were essential - I emphasize the word “ essential “ - to the maintenance and expansion of the industries of this country, was £700,000,000-odd. Every one of the commodities that came into this country from overseas and that went into our primary and secondary industries carried a proportion of that cost of £403,000,000 for invisibles. All this added to our cost structure. It added to the cost of the products of secondary industry here and to the cost of those products of secondary industry that were used in primary production. All these things add to our total cost structure. There can be no doubt whatsoever about that. If the Prime Minister (Mr. Menzies) was right in saying that, at our peril, we add to the cost structure of this community, then equally at our peril do we borrow from overseas £44,000,000 to make payments in this community which, in days gone by, were made out of revenue because that £44,000,000 becomes an addition to the cost structure of the community. Also at our peril do we send abroad £50,000,000 in interest, for which we secure nothing in return, because that payment also forms part of the cost structure of the community. It, too, is added to the cost of every article we seek to export abroad and to the cost of every article sold on the home market of Australia.
For those reasons, the Australian Labour Party opposes the proposal to secure this loan overseas. It opposes the obtaining of the loan for exactly the same reasons as it opposed the securing of private loans by private people at a time when Australia was at war, at a time when it was essential that all the resources of the country be directed towards defending the country against invaders from overseas. If we can possibly prevent it, we of the Australian Labour
Party do not propose to allow this country, which was defended with the lives and blood of thousands of its sons, to be sold overseas to international financiers. We do not propose to allow Australia to be pawned, as it were, in the pawnshops of Europe and other countries of the world.
After all, the proposed loan is a circumscribed one. The borrowers will not be able to go abroad and say, “ We propose to spend the money in the cheapest market to the best advantage of the people of Australia “. Not at all! Section 2.03 of the agreement provides that the loan shall be expendable only in the currencies of the member countries of the International Bank for Reconstruction and Development and Switzerland. Therefore, we will be compelled to buy in those particular markets. The agreement further provides that the loan shall not be in the currency of the borrowing party. This means that if the International Bank for Reconstruction and Development had funds available in Australia, we could not utilize those funds to pay people in this country to do work within this country. It means that we could not utilize the currency of this country, even if the International Bank for Reconstruction and Development had funds in this country, to pay wages or for the purchase or provision of equipment. Under the agreement, we are compelled to go overseas to the countries specified in that agreement with the International Bank for Reconstruction and Development. Are these conditions desirable, and are they in the best interests of the people of Australia? I think we all know the story of the spendthrift. First, he borrows because he needs money for some particular purpose. Then he borrows in order to pay interest upon the money he has already borrowed. In a case such as this he borrows to replenish his overseas funds, as it were. Then he borrows from Switzerland to pay the United States of America, or he borrows from the United Kingdom to pay the Netherlands. That is the position into which the Government has already got this country.
In the days gone by, in the late 1920’s, a depression came upon Australia. This country was hit by an economic blizzard, as it were. What caused that depression? Did it overtake us because we were no longer able to produce in this country the primary products necessary to feed our people? Did it overtake us because there were not on the shelves of the shops of Australia the goods necessary to clothe, shoe and shelter the people of Australia? No, it did not overtake us for any of those reasons! All those things were here in as great a profusion as they had ever been before in our history. The depression resulted from the fact that the international financiers turned off the tap of international financial assistance for this country. In effect, those international financiers said: “ You have borrowed enough. From now on, you must pay back.” They sent to this country Sir Otto Niemeyer and Professor Gregory to act, in effect, as bailiffs on their behalf. Those bailiffs said to the people of this country, “ From now on your standard of living shall be reduced by at least 20 per cent, and your pensioners “ - who were already on the breadline - “ shall be reduced to starvation limits”. Those are the conditions that must inevitably result from the actions of a spendthrift government which goes abroad to purchase and to borrow in order to pay for those things that should be made with the sweat, blood and toil of the people of this country. Particularly is it anathema to me as an Australian that the Government should go abroad to buy goods which have been produced in this country ever since the beginning of the Snowy Mountains scheme, especially at a time when more than 1 00,000 of Australia’s sons and daughters are without employment.
– The honorable member for Scullin (Mr. Peters) finds the Government’s policy in this matter incomprehensible. I suggest that honorable members generally might well be excused if they took a somewhat similar view of his speech. The honorable member for Scullin began his speech by misrepresenting the honorable member for McPherson (Mr. Barnes). It was obvious that the honorable member for McPherson was referring in his remarks to the way in which the Labour Government had stifled the economy with its post-war controls. He was not complaining about the mobilization of the Australian economy by the Labour Government during the war period; he was objecting to the Labour Government’s endeavour to continue war-time siege economy conditions in peace-time. This culminated in the effort to nationalize the banking system so that the whole economy and the whole distribution of the resources of Australia would be brought under the iron grip of the Labour caucus.
There is one point on which I should like to disabuse the mind of the honorable member for Scullin. It concerns the currencies specified in this bill. The honorable member suggested that we would necessarily have to purchase goods for the Snowy Mountains scheme in these currencies. Of course, Mr. Deputy Speaker, that is not so. The bill means merely that part of the loan is in these currencies and has to be repaid in these currencies; but when we draw these amounts we can convert them into any other currency which may be suitable for our purposes.
The basic purpose of this loan is essentially simple, lt was very well brought out by the honorable member for Bruce (Mr. Snedden), who said that the loan would provide the Australian economy with a fresh capital infusion for development, equivalent to about £44,000,000. This loan has been related to the Snowy Mountains scheme because, for some years, the International Bank has refused to lend, as it lent earlier, for general development, and has stipulated that its loans shall be only for specific projects. This loan has been related to the Snowy Mountains scheme because it is a large scheme which is under the control of the Commonwealth. For the most part, the big public works which it is necessary to finance by borrowing are run by the States. This one is run by the Commonwealth which enables a great simplification in the process of borrowing. It would be quite a mistake to confuse a means of getting additional capital for the more rapid development of Australia with the specific project on to which the loan is tacked.
The honorable member for Scullin criticized the Government for repaying to the International Monetary Fund a loan of about £78,000,000 which we had at a low rate of interest, whilst borrowing for a long period at a much higher rate of interest. The reason for this is that drawings from the International Monetary Fund are for short-term, balance-of-payments purposes.
When that purpose is achieved, as it has been in our case owing to the recovery of our overseas funds, we are in honour bound to repay the loan to the International Monetary Fund as quickly as we can. The whole idea of the International Monetary Fund is that it is a revolving fund to help individual countries over temporary balance-of-payments difficulties. When those difficulties are overcome the drawings ought to be repaid as soon as possible because they may be wanted by some other country, perhaps to maintain its volume of purchases from Australia. The loan with which we are now dealing is entirely for long-term purposes.
The honorable member for Macquarie (Mr. Luchetti) said that our capacity to pay should be carefully examined. Let me assure the honorable member that before the International Bank makes a loan it examines very carefully the capacity of the borrowing country to repay and it takes that country’s future prospects into close consideration. The honorable member for Melbourne Ports (Mr. Crean) said that more of these funds should go to under-developed countries than to countries such as Australia. It is interesting to note, however, that over 3,500,000,000 dollars, or more than 60 per cent, of the bank’s loans, have gone to under-developed countries, including 846,000,000 dollars to India. A further point which I would like to bring to the attention of the honorable member for Melbourne Ports is that other countries have used Australian currency. We have made our currency available to the International Bank for the purchase by borrowing countries of Australian goods. We have supplied for this purpose about £13,000,000 in Australian currency which has been lent by the bank almost entirely to underdeveloped countries, mainly in Asia and the Middle East.
Much has been said about this so-called profligate Government, but let us look at some of the figures. One of the things that the Labour Party never seems to understand is that we borrow money in order to grow, and that, as a result of borrowing and making extra resources available to the country, the economy grows very much quicker than it would without those resources. For instance, when the Labour Government left office overseas interest on government loans amounted to about .9 per cent, of the national income. To-day, it amounts to .5 per cent, of the national income. In other words, we have grown faster than the loans that we have received. In 1949 the overseas portion of the Commonwealth and States debt represented 26.2 per cent, of the national income . To-day it is 12.1 per cent.
The per capita debt has declined steadily over the years. There have been ups and downs, but the overseas debt per capita, which before the war was £87 lis., is now only £67 3s. 9d. The per capita interest liability, which before the war was £3 lis. 4d., is now £2 16s. 9d. The proportion of the Australian Government’s interest liability payable overseas has dropped from 20.4 per cent, when the Labour Party left office to 17.3 per cent, to-day. Our present governmental interest liability is about 3.2 per cent, of our exports. In the early 1930’s, the corresponding figure reached about 30 per cent. These figures indicate that even if Australia borrowed every penny that it could borrow, governmentally, the load of this kind of debt on the Australian economy would be virtually negligible. That is one of the factors which are taken into account by other people when they lend us money. Long before the time comes for this loan to be paid off, Australia’s capacity to pay will be very much greater than it is at the moment.
This loan, of course, has been approved by the Australian Loan Council. The State Premiers, whether Labour or otherwise, who are concerned with the practical business of obtaining resources to develop their States, were not nearly so reluctant to approve of this loan as are honorable gentlemen opposite. In fact, as has frequently been pointed out, at least two of them maintained a very strong organization. The Labour Government of New South Wales has established a special office in New York to promote this process. It wants to get foreign firms and interests to invest money and promote Australian development, and it is doing so wisely and rightly.
There is a lot of reluctance on the Opposition side to this sort of thing but when Mr. Chifley was the Labour Prime Minister of Australia he touched the International
Monetary Fund for 20,000,000 dollars without any hesitation. He was glad when he got it - and very wisely and sensibly so.
The basic point and purpose of overseas borrowing is to promote the more rapid development of Australia as a whole than would otherwise be possible. Xenophobia is very prevalent in Australia and particularly among honorable gentlemen opposite, and if it is allowed full rein it will simply slow down Australia’s development. Honorable members should know that they cannot eat their cake and have it too. If we want to develop quickly, we must have a large proportion of overseas capital and overseas people, controlling industry in some cases and sharing it in others. That is essential if you want development. It is a question of the view that is taken.
Do honorable members opposite want a smaller Australia? Do they want development to be arrested or slowed down on the reasoning that we will be proud men owing nobody a penny? The other view is that we take perhaps a few risks. I do not think we are taking any risks of a serious nature; but we have to take all the risks we can on the resources we can develop in Australia and do the best we can. That will be the basis of our eventual survival.
.- In the brief time at my disposal, I want to discuss certain aspects of the proposed loan for which provision is made in the bill before the House. First, do we need this loan? Is it internationally moral that we should take such a loan from an organization like the International Bank for Reconstruction and Development? This organization came out of the Bretton Woods Agreement of 1944, and I remind honorable members that there was a difference of opinion within the Australian Labour Party at the time on whether Australia should or should not join the Bretton Woods Agreement. It was discussed at great length in the party rooms and there was strong disagreement. Finally, it was decided that the Labour Party would support the Bretton Woods Agreement and later I shall quote passages from the speech of the Labour Prime Minister of the day, Mr. Chifley, when it was proposed that Australia should become a member of the International Monetary Fund and of the Inter national Bank for Reconstruction and Development.
Those organizations were the two banks estbalished under the Bretton Woods Agreement in its infancy. A comparison between the two banks is interesting. The International Bank for Reconstruction and Development borrows money from countries and from private individuals on the loan market, and lends to countries on a longterm basis. At present, it charges interest at the rate of 5i per cent. In the early days of the bank, the rate of interest was about 4 per cent. The International Monetary Fund was created to assist nations in times of temporary failure of crops, floods, famine and difficulties with the balance of trade. When a bill was introduced in 1947 to approve of Australia becoming a member of the International Monetary Fund and the International Bank for Reconstruction and Development, Mr. Chifley stated in his second-reading speech in this House -
These institutions form part of the general structure for peace, security and welfare in the post-war world . . .
The broad object of this machinery is to promote throughout the world expanded production, employment, trade and higher standards of living all round.
Later in his speech, Mr. Chifley said -
The purpose of the International Bank for Reconstruction and Development is to provide a source of capital funds for the reconstruction of countries devastated by war and for the development of industrially backward countries.
Subsequently, Mr. Chifley added -
It is unlikely that Australia would itself require to borrow from the bank.
That was the great moral belief in these banking institutions. The International Bank for Reconstruction and Development, in particular, was to assist war-torn countries and under-developed countries. But what do we find? We entered into this agreement in 1947 and now, fifteen years after, we find that Australia is the second biggest borrower from the International Bank. India, with a population of 450,000,000, has borrowed 558,000,000 dollars. France, which was torn by war and has a population of 60,000,000, has borrowed 337,000,000 dollars. Japan, which was devastated by war, has borrowed 323,000,000 dollars. Yet Australia, which has not been scratched by war, has borrowed 417,000,000 dollars, including the
Those were the moral principles of Mr. Chifley and others; but the attitude of this Government is: “ Let us drain every penny out of this bank. It is a good borrowing bet.” It is interesting to note that the earlier idealistic principles of a world bank have gradually dwindled and that it has become a real banking institution. In fact, it has attracted some of the criticisms that were predicted by some members of the Australian Labour Party and has become part of the financial institutions of the world.
In 1955 the International Finance Corporation was created. Approval of Australia’s membership of the corporation was sought in a bill that was introduced in this House in 1955. The Commonwealth Treasurer of the day, Sir Arthur Fadden, said that private enterprise would now enter into and assist under-developed nations. In his second-reading speech, as reported in volume 8 of “ Hansard “, at page 1838, Sir Arthur Fadden said -
The main purpose of the corporation is defined in its articles of agreement in the following terms: -
To further economic development by encouraging the growth of productive private enterprise in member countries, particularly in the less developed areas . . .
We know that private capital goes only to the countries where it can get the greatest return, but it is interesting to see that in 1960 this House agreed to the formation of an International Development Association. This was a new organization to assist only the backward countries of the world because it was found that the backward countries were not being helped by the other agencies I have mentioned. Thirteen years after the Bretton Woods agreement, the nations decided to form the International Development Association in order to try to assist backward nations.
Sitting suspended from 5.59 to 8 p.m.
On many occasions we have challenged the Government on its borrowing policy. It has borrowed everywhere it can all round the world. Since 1949, the Government has borrowed from the United Kingdom £124,500,000 sterling, from Canada 35,000,000 dollars, from the United States 316,000,000 dollars, from Switzerland 240,000,000 Swiss francs, from the Netherlands 40,000,000 guilders and, with this loan, 417,000,000 United States dollars from the International Bank. It has borrowed overseas £526,000,000 in Australian currency since it came into office.
The interest bill on all this borrowing is £30,000,000 a year. The nation’s interest bill has risen to this figure from £19,000,000 in the last year of the Chifley Government, an increase of about 50 per cent. These interest payments are in respect of foreign loans only. The honorable member for Wentworth (Mr. Bury) said that the Government had been able to reduce borrowing on the internal loan market, but he did not add that internal borrowing by the States has jumped twofold since the Government took office.
There have been other borrowings which 1 have not so far mentioned, for instance from the International Monetary Fund. The Labour Government under Mr. Chifley borrowed 20,000,000 dollars from the International Monetary Fund and this Government has borrowed from that body 30,000,000 dollars and 100,000,000 dollars, respectively. All three of those loans have been repaid. I mention the International Monetary Fund also to enable me to point out to honorable members that we should not confuse the two international lending agencies, the International Bank for Reconstruction and Development and the International Monetary Fund. The International Bank lends money over long periods of up to 25 years and charges a comparatively high interest rate. The interest rate which will be paid on the loan with which the bill deals is 51 per cent. The International Monetary Fund lends money to countries facing temporary problems such as balanceoftrade difficulties, famines and floods, and the interest rate charged is I per cent, or 2 per cent, whilst the loans are repayable over a period of three years to five years.
While condemning the Government on its borrowing policy we of the Labour Party admit that it may be necessary to borrow in certain circumstances, for instance if we cannot export sufficient goods to pay for our imports including capital equipment and technical know-how not available in this country. But the Labour Party believes that we should be very selective in such borrowings. We do not say outright that it is never necessary to raise loans abroad, but we argue that we should not borrow abroad to finance national works when we have already in this country the labour, the materials and the money needed to carry out those works.
The Government claims that this loan of £44,000,000 or 100,000,000 dollars is needed to finance certain works on the Snowy Mountains project. The Chifley Labour Government, which started the
Snowy Mountains scheme, developed the project out of revenue. The Menzies Government up to the present has followed that practice but now it has decided to take a different course. It now claims that we have to have loan money to carry out this work. It says that the money is needed for capital equipment, and that the bill itself contains a proviso that the loan is to be used for certain works to be carried out by the Snowy Mountains Hydro-electric Authority. There is some confusion here. The Treasurer (Mr. Harold Holt) said in his second-reading speech that the money was to be used for the Snowy Mountains project, and Article III. of the First Schedule to the bill provides as follows: -
The Borrower shall cause the proceeds of the Loan to be applied in accordance with the provisions of the Loan Agreement exclusively to expenditures on the Project after June 30, 1961.
Yet the Minister assisting the Treasurer (Mr. Bury) said that he agreed that the money we are to get from this loan will not all be used on the Snowy Mountains project but will give us a credit, and therefore people who want to buy overseas should be able to do so. He let the cat out of the bag. So all the red tape in the schedule gives the wrong picture. There is a difference of opinion on the use of the money between two Ministers - the Treasurer and the Minister assisting the Treasurer.
I place on the table Schedule 2 of the First Schedule to the bill which is headed “ Description of Project “, and with the concurrence of honorable members I shall incorporate in “ Hansard “.
Mr. SPEAKER__ Is leave granted?
Government Supporters. - No.
– Leave is not granted.
– I made arrangements with the Minister assisting the Treasurer, before he spoke previously, to have Schedule 2 of the First Schedule incorporated in “ Hansard “, and the Minister for Repatriation (Mr. Swartz), who is now in charge of the House, said that he had no objection whatsoever to that. Schedule 2 describes the projects on which this money will be spent, yet the Government refuses to have it incorporated in “ Hansard “. Obviously, the Government does not want the people to know how this money will be spent. It wants to be dishonest about the facts. We know already that one Minister has said that all the money will be spent on the Snowy Mountains project and another Minister has said that not all of it will be spent on this project but some of it will be used to pay for imports. Now that the Minister has examined Schedule 2 of the First Schedule to the bill, I again ask him whether he will agree to it being incorporated in “ Hansard “.
– Leave is granted.
– I thank the House. Schedule 2 is as follows: -
SCHEDULE 2. Description of Project
The Project is part of the Murray Development being carried out by the Authority in the Snowy Mountains Area of the Borrower to divert waters in the Area for hydroelectric power generation and irrigation purposes. The Project consists of works to divert the waters of the Snowy River by a tunnel through the Great Dividing Range to the Murray River catchment, and for the utilization of the diverted waters for the generation of electricity. It includes the following major works:
Island Bend Dam.
A concrete gravity dam about ISO feet high and with a crest length of about 470 feet will be constructed on the Snowy River at Island Bend. The dam will create a storage of about 2,500 acre feet. It will have a 270 ft. deep outlet shaft and control structures to regulate the flow either via the Snowy-Geehi tunnel to the Murray No. 1 power plant or through the Eucumbene-Snowy tunnel to Lake Eucumbene for storage.
A tunnel about 15 miles long and with a cross sectional area of about 350 square feet will be constructed to connect the outlet shaft at Island Bend Dam with the existing outlet works at Lake Eucumbene. The tunnel will be designed to permit flow in either direction so that water in excess of immediate requirements for power production can be stored in Lake Eucumbene until required.
A tunnel about 9 miles long and with a cross sectional area of about 350 square feet will be constructed to carry water westwards from the Island Bend works to a reservoir to be created by the Geehi Dam.
A rock fill dam about 300 feet high and with a crest length of about 970 feet will be constructed on the Geehi River to create a reservoir with a capacity of about 17,300 acre feet. The reservoir will collect waters flowing from the Upper Geehi River and from aqueducts in the Bogong Creek and Geehi River areas, and will balance the inflow from the
Eucumbene-Snowy-Geehi diversion system with the intermittent water requirements of the Murray No. 1 power plant
Murray No. 1 Pressure Tunnel and Pressure Pipelines.
This tunnel will be about 7.5 miles long and will have a cross sectional area of about 420 square feet. It will convey water from the Geehi reservoir to twin steel pressure pipelines which will in turn convey the water to the Murray No. 1 power plant. The pipelines will each be about one mile in length and will vary in diameter from about 14 feet at the junction with the tunnel to about 12 feet at the power plant.
Murray No. 1 Power Plant.
This plant will be constructed on the right bank of Khancoban Back Creek, near Khancoban. The generating plant will consist of eight Francis type turbines each directly coupled to a 95 MW alternator. A tailrace channel will convey the water from the turbines to Khancoban Back Creek. The output of the turbo-alternators will be stepped up from 15 kv to 330 kv and delivered by overhead transmission lines to a substation which will be constructed near the plant.
This earth and rock fill dam will be about 60 feet high and will have a crest length of about 3,500 feet. It will be constructed on the Swampy Plains River just downstream of Khancoban Creek, to create a reservoir with a capacity of about 20,000 acre feet. The reservoir will be used to regulate the fluctuating releases from the Murray No. 1 power plant, so as to provide a practically uniform outflow into the Swampy Plains River.
The estimated total cost of the Project is about 99 million Australian pounds. It is scheduled for completion in 1967.
I cannot understand why it is necessary to import materials for these projects. The necessary materials are available in Australia. We have the iron, the steel, the cement, and the equipment that is needed to build these projects, and we certainly can find the men from among the vast number of unemployed. The only project for which it may be necessary to import capital equipment is the Murray No. 1 power station. The generating plant for this project may have to be imported.
The last paragraph of the schedule reveals that the seven projects will cost only £99,000,000. This loan is in fact for £44,000,000. The Government is using the Snowy Mountains project as an excuse to borrow overseas. It is putting another of our assets in pawn so that it can get further loans from overseas. As I said previously, the Government has already borrowed from the International Bank on six occasions and this will be its seventh loan. The total amount borrowed, including this loan, will be 417,000,000 dollars. I remind the people of Queensland that when an application was made some eighteen months ago to the International Bank for a loan so that the Mr Isa to Townsville railway could be rebuilt, the president of the bank, came here and examined the proposition. The amount needed was in the vicinity of 44,000,000 dollars. What happened? The International Bank said it would not grant the loan.
When the reconstruction of the railway was first mentioned, we on this side of the House challenged the Government to find the money. We said: “ Why do you need a foreign loan to finance the renewal of this railway line? We have the men and the material in this country. The Commonwealth Bank of Australia can finance this national project.” The Government said: “ No, we must get a foreign loan. It is necessary to have foreign capital.” After the International Bank refused to grant the loan, the Commonwealth provided the money to the State at a particularly high rate of interest. This was most unfair to Queensland. We could have made the finance available out of the Treasury or by a note issue from the Commonwealth Bank. This is true also of the Snowy Mountains project. We could find the money from revenue or by note issue from the Commonwealth Bank to finance our great national projects. But this Government must build up its overseas reserves. I admit that it may be necessary to import certain equipment for the Snowy Mountains project. But our overseas reserves now total over £500,000,000 and we could surely afford the few million pounds that would be necessary to buy the capital equipment needed for the Murray No. 1 power station.
This Government is a big overseas borrower. It has borrowed from every country that will lend to it. The Chifley Government during a time of war reduced its overseas borrowing and still met its commitments in Australia. But this Government has put us more and more into debt with overseas loans. I am aware that overseas loans are the lesser of two evils. They are not as bad as the inward flow of overseas private capital. My colleague, the honorable member for Yarra (Mr. Cairns) will deal with this aspect in detail later. But the real problem is that the Government has no policy on borrowing. It has no moral outlook. It has borrowed from the International Bank although the bank was created in the first place to assist war-torn and backward countries. The Menzies Government from 1949 onwards has borrowed 417,000,000 dollars and is the second biggest borrower from the bank. We realize that under-developed countries are poverty-stricken and their peoples are hungry and disease ridden; but the Government has done very little to relieve their distress.
The honorable member for Mcpherson (Mr. Barnes) said that he was very proud of the fact that we have contributed £40,000,000 to the Colombo Plan. Let us examine that position. During the time that we have contributed £40,000,000 to the Colombo Plan, we have through this Government spent more than £2,000,000,000 on defence- or should I say that we have spent £2,000,000,000 on fear! Had we spent a large part of our defence vote in assisting to develop the backward nations, and had we assisted them to get a greater share of the funds available from the International Bank, we would have been far better off than we are. But this Government is smug and complacent. It has borrowed 417,000,000 dollars from the bank and is the second biggest borrower. The Government is guilty of an immoral action. We of the Opposition oppose the bill.
– Having listened to honorable members opposite, I cannot understand why they intend to vote against the bill. Many of their arguments have been in favour of it. There are two aspects of the legislation. It is a bill to borrow money abroad and to spend the money so borrowed on the development of the Snowy Mountains project. This measure raises two different questions, the first as to the economic desirability of the Snowy Mountains scheme and the second as to the desirability of borrowing abroad in this way. I shall not devote much time to the first of these two questions. I do not want to put before the House any conclusion in that regard, except to say that I think it is time that we had a very careful look at the scheme, and especially at its economics. 1 am not trying to pre-judge in any way the result of such an examination. It may well show the scheme to be excellent in every respect, or it may well show that the scheme has been overrated. I do not know, and, as I have said, I am not trying to pre-judge the result of such an examination. I say only that no such examination has been made and that particulars and figures to show exactly what the economic desirability of the scheme is or how it is working out are not available to honorable members or to other people in Australia. We have seen the accounts of the Snowy Mountains Hydro-electric Authority, of course, but there are so many uncertainties in those accounts. So much is held in suspense for uncompleted works and so on that one cannot come to any conclusion.
Since the Snowy Mountains scheme was inaugurated, there have been big technical changes in power generation throughout the world. The impact of these things and of the high-tension transmission of electricity may be ambivalent. It may be favorable to the Snowy Mountains scheme or it may be unfavorable. All that I say is that the economics of power generation in 1962 are quite different from the economics of power generation as we knew them in 1949 when the scheme began to take form. I think that we should have another look at this matter, but I am not trying to prejudge the issue. I certainly do not say that the Snowy Mountains scheme is useless, wasteful or anything like that. I say simply that the time has now come for a re-assessment of the scheme in the light of changing techniques throughout the world in the generation of power and, indeed, in the provision of water supplies. The Snowy Mountains scheme, of course, is a two-edged scheme. It provides water as well as power.
I do not want to say any more about that aspect of the bill. I turn now to the aspect of borrowing abroad for this purpose. I do not think the Opposition has realized what the position is. If one looks, for example, at the balance of payments statistics which have been produced over many years now by the Treasury, and examines them in detail, one sees that in the fouryear period ended on 30th June last we were running consistently into debit on current account. After paying for our imports, making provision for remittances for invisibles on account of interest, profits, freight, insurance and things of that character, and setting off our exports and our own invisible earnings, we are left with an annual debit on current account. According to the Commonwealth Statistician, in successive financial years during the four-year period ended on 30th June last, the annual debits were £152,000,000, £185,000,000, £222,000,000 and £368,000,000. Those annual debits on current account represent the short-fall of our earnings internationally in each of those years. It is true that for this financial year the position looks better. But the financial year is not yet finished and we cannot be quite certain of what will happen, and I would say that probably even for this financial year there will be a debit on current account, even though it be a comparatively small one.
This annual debit, if it continues to run, must be made good by investment from abroad. This is simply a statement of fact, like the statement that twice two make four, and not a statement of opinion. We can do one of two things about the situation. Either we can change the pattern of our trade and the circumstances of our living and development so that we do not run into debit on current account, or we can obtain investment from abroad to make good the leeway which fluctuates according to fluctuations in our balances of international currency held overseas, mainly by the Reserve Bank of Australia. Unless we do something to make good this debit by changing the whole habit of our living, we have to obtain investment from abroad. If we do not obtain it, we go bankrupt. We cannot meet our external obligations without it. This is simply a truism - a statement of fact and not a statement of opinion.
Let us come now to things about which there is some room for argument. In what I have just said, there is no room for argument any more than there is room for argument about the multiplication table. What are we to do about the situation? Are we to continue to go into debt in our current spending? There could be some justification for this if we were to consider ourselves as a rapidly developing country. On the other hand, those who have been abroad tell us that the rate of development in
Australia, although good and substantial, is not outstanding at present by world standards. So, on this score, we may not have such a good reason to continue to go into debt.
It is true that Australia is still developing. This is a big country which is expensive to run and there is a call for development. But, on the other hand, this is a country with great capital resources. Per head, we are probably the richest people in the world, even including the Americans. So there does not seem to be much reason why we cannot carry on, especially since we are not at present, contrary to the impression of my friend, the honorable member for Reid (Mr. Uren), spending any great sum on defence. Per capita and as a proportion of national income, our expenditure on defence is much less than is that of other countries. And these other countries are the lenders. We must remember that if we run into debt somebody else, by the normal principle of bookkeeping, is correspondingly in credit. A borrower implies a lender. If we take real resources from abroad and add them to the activities of the Australian economy, somebody else - the lender overseas - is taking resources which would otherwise have been used in his own economy and transferring them to ours. There is a minus as well as a plus transaction.
I leave the question there. There are arguments on both sides. However, I make one observation which I think should be taken to heart at this time. It is a very simple observation: In the past, and especially, in the four years that I have mentioned, when we overran our overseas earnings so badly by these hundreds of millions of pounds that I have detailed, there has been a chronic short-fall in Australia’s savings. That situation exists no longer. Temporarily, in the last eight or nine months, this chronic short-fall in Australian savings has ceased. But we have not made proper use for development of the resources thus made available.
We have now a savings rate which is commensurate with the stability of our national economy. We have managed to achieve this, but we are throwing away all the benefits that flow from it by allowing unemployment and under-employment to continue, and by allowing our rate of development to slow down. In this I think the Government is wrong. I think the Government should be doing a great deal more, and doing it more effectively and decisively, to step up Australia’s development. For this purpose it should be using the resources that have been made available through the rise in the Australian savings rate. This rise, by the way, is not by any means an unhealthy rise. It is simply a rise commensurate with the necessity so to adjust our economy as to reduce our dependence on the inflow of funds from abroad.
Because the Government is apparently unwilling or unready to go forward with the necessary speed, we find the invaluable human and material resources available in Australia going to waste through unemployment and through what may be statistically even more important, the underemployment of our resources of machines in factories and elsewhere. If we were to use these resources fully we would have a much higher level of employment in Australia and a much higher tempo of economic activity. This would have two effects, a much higher rate of development and, at the same time, a reduction of this chronic deficit in our current balance of payments overseas. I put it to the Government that this is the time when it should be acting much more decisively, much more strongly and much more directly.
Now let me come to another aspect of this matter. Suppose we are over-spending on current account overseas. Suppose that this deficit which has existed over- the last four years, and which has been only momentarily checked in the last few months, re-appears. Then it will be necessary for us, as I have said, either to go bankrupt or to get investment capital from abroad. If we get investments from abroad, what form will they take? In general, there are two forms that such investments could take, either equity investment or debenture investment. The distinction is, I think, perfectly plain to honorable members. Equity investment means the buying by people overseas of real things in Australia. They may be ordinary shares in companies, bits of real estate, factories or houses. As
I say, it is a matter of purchase from overseas of real things in this country. Debenture investment occurs when countries overseas lend to us a fixed amount of money on fixed terms. I put it to the House that debenture investment is much better for national purposes than equity investment. If this investment capital has to come in, it will be much better for us if the proportion of it represented by debenture investment is greater than that for equity investment.
The measure that is now before us does just what I suggest is desirable. It involves debenture borrowing, and this means that the money obtained will help to meet any short-fall in our international accounts without making us liable to accept equity investment and to pass real property in Australia from Australian hands into overseas ownership. When I say real property, I do not necessarily mean real estate. I mean all manner of real things.
I am surprised that the Opposition is not supporting this bill. After all, this is surely a measure that should receive the approval of the Opposition. Judging by the comments that have been made by some honorable members who have spoken in this debate, I do not think that the point I am making is properly understood. Honorable members opposite, or at least those who have spoken, do not seem to understand that this money will be added to our international reserves, even though the actual expenditure may be taking place in Australia. Being added to our international reserves, it will make it possible for us to avoid the national bankruptcy that might otherwise have followed the chronic over-spending in which we have been engaging. Surely the Opposition should realize that this debenture investment is very much preferable to equity investment.
Let me put one point which sometimes escapes attention. We in Australia are increasing our population not only by the natural increase. We are also receiving quite a large number of immigrants, and our net gain from immigration is quite appreciable. Each one of these immigrants requires considerable capital investment for his sustenance. This capital investment may be in a factory or a farm or a house; it may be expenditure on roads or on power systems. The Snowy Mountains scheme represents one such investment. I do not know whether any accurate determination has ever been made of the extent of this necessary capital investment on each immigrant. Figures of £2,000 and £3,000 have been given as representing the investment necessary to sustain a single immigrant. If a figure of this order is correct, then it would appear to be reasonable for us to obtain debenture investment of £100,000,000 or so a year on this account alone, because we are taking from overseas countries people whose presence in Australia requires extra capital investment, and whose departure from their homelands results in a reduction of the required capital investment in those countries.
I believe we should be closely considering this aspect of the matter, bearing in mind that the amount of debenture investment in Australia in the past has been very small. It is not easy to make an accurate dissection from the official figures, but I think it may be generally assumed from the figures that government investment has been debenture investment while private investment has been equity investment. This is not completely true, but it is true enough to give some kind of a picture. A table before me gives the net amount of government debentures raised overseas in the past five years. For 1956-57 the figure would be minus £5,000,000 - not a net gain but a net loss. In 1957-58 there was £8,000,000 net gain; in 1958-59, £21,000,000; in 1959-60, £29,000,000 and in 1960-61 £82,000,000, but this last figure includes the temporary borrowing of £78,000,000 from the International Bank, which I understand was subsequently repaid.
These are not big figures in comparison with the private investment from abroad. They average, I suppose, something of the order of 10 per cent, of the private investment. The overwhelming amount of investment occurring in Australia, therefore, is now by way of equities rather than by way of debentures. This, I think, is unhealthy and is something which the Government is very wise to take measures to reverse. For this reason I commend the bill.
I leave up in the air the fact that the bill still does not touch directly on the question whether we are wise to maintain a system where we have a large deficit in our balance of international payments. I leave up in the air the question whether we should be doing more to stimulate our economy at the present moment and use Australian savings for Australian development of one kind or another. I simply say that, in all the circumstances, it is wise for the Government to be getting more debenture investment abroad rather than to rely entirely on foreign equity investment. I support the bill.
.- The honorable member for Mackellar (Mr. Wentworth) is always interesting and always holds us in some measure of suspense. On every occasion when he has spoken this year he has made a pretty forthright attack on the Government but then, at the last minute, he has failed to strike. He reminds me of a very clever scientist, with his solar topee and white shorts, tripping through the jungle in search of one of the terrible animals that inhabit it and who, suddenly finding that the terrible animal is the Prime Minister (Mr. Menzies) promptly turns and runs up a tree chattering. This brings our minds back to our ancestors. This is another occasion when the honorable gentleman has performed similarly and he has done it in a very interesting way.
First of all, the honorable member for Mackellar examined the Snowy Mountains hydro-electric scheme. He thinks we should have a complete re-examination of the scheme. He is not certain what the outcome will be and he has not prejudged it. But he seems to imagine that there is some alternative way of producing water for the Murray River area except by running it down the Murray. He seems to think there is some alternative way of producing electric power in the area, except by its generation through the use of water. This is very interesting and I suppose it will warrant a special little paragraph in at least one or two of the Sydney newspapers to-morrow, but it is not very important. It is not important because, beyond all shadow of doubt, the Snowy River scheme has a thoroughly good economic foundation and justification and will possess them for a good many years to come.
The second point raised by the honorable member for Mackellar is more significant.
He says this bill involves borrowing from abroad, and we must examine carefully what is involved in this. He began his examination by saying we have had a debit on current account for a good many years and that over the last four years it has amounted to some £600,000,000 or £700,000,000. Of course, that is true. Then, he says that the statement that this amount has to be made good by investment from overseas is a truism - that it is like the multiplication table. That, of course, is not the case. It is not a truism and it is not like the multiplication table. There are various ways of making good a deficit on current account, and investment from overseas is only one of them. It is the worst of the ways that are available. One would imagine, on looking at the economic policy of this Government over a period of a few years, that everybody on the other side of the House thinks it is a truism and that if you are running yourself into debt it is like the multiplication table and you have to borrow from overseas to make up for it. But it is not a truism.
There are alternative ways of dealing with the situation and apparently the Government is not aware of any of them. Assuming for the moment that the honorable member for Mackellar was right and that there is no other way out of this situation in which the Government finds itself, except for borrowing overseas, the question I want to raise seriously for consideration is: “ Can it be made good in this way? “ There are two forms of investment. The honorable member for Mackellar wants to call them debenture investment and equity investment - those are his terms - but I call them government borrowing and private borrowing. That description is much easier to understand. Government borrowing, on the whole, is far the better of the two. I am pleased that the honorable member for Mackellar recognizes this, because it is about the only sphere in which honorable members on the other side of the House recognize that government action is better than private action. Government borrowing is the better of the two because we get the money at lower cost and with longer periods for repayment than if we borrow privately. Just as in any other field, money is more readily available at lower rates of interest and for longer terms if we borrow publicly than if we borrow privately. Of course, even in respect of public borrowing, this is not just what it seems.
The total amount of government loans since 1949-50 is £526,700,000. That is an enormous amount, and it looks good on the surface. The sum of £526,700,000 has been made available for Australia to spend overseas and to spend, incidentally, on a great many unessential and unimportant things on which the money has, in effect, been wasted. That money has been borrowed at the same time as we have paid £269,000,000 in interest. Even in this more attractive and better field of public borrowing, surely this is a matter which should produce a few questions on the other side of the House. In eleven or twelve years the Government has been able to obtain £526,700,000 at the same time as it has spent £269,000,000 in interest! It has not left us with that big a margin. There has been a net gain in the public field of £257,700,000 during that period with the interest burden rising all the time. The interest burden was £19,000,000 a year at the beginning and £29,000,000 a year at the end of the period. If the Government was intent on filling this deficit on overseas account exclusively by public borrowing I think it could go on for a long time at this rate without coming to the end of the possibilities. But public borrowing is not nearly enough to fill the kind of overseas deficit which this Government has been able to work up.
In passing, I want to say a word or two about the other type of borrowing to which the honorable member for Mackellar has made reference. The greater part of the borrowing by the Australian people has been private borrowing. This total of private borrowing has risen in each year since 1949-50, when it was £68,500,000, to £189,900,000 in 1959-60. This has brought in a vast flow of money and looks a most attractive prospect. We sometimes think we will be able to go on for ever in this way, but the real value of this policy is in what it actually does to our overseas funds each year. So we have to be concerned with the inflow of money on the one hand and with the outflow of money on the other hand. The outflow of money is rising, too. In 1949-50, it was £34,800,000, and by 1959-60 it had grown to £121,200,000. Two things are happening. First, both totals are rising rapidly, and secondly, as the years go by they are coming closer together. The net amount of money obtained on the inflow side is rising, but it is rising less rapidly than the amount of money on the outflow side. So that if we contrast the two columns of figures over the last twelve years, we find that the total of one column exceeds the other by £318,200,000. On the side of public borrowing, we have had a net gain of £257,700,000, and on the side of private borrowing the net gain has been £318,200,000.
But there is one sleight of hand trick practised by the Treasury and the Bureau of Census and Statistics in connexion with this matter which ought to be made clear. The sleight of hand trick practised by these two Government instrumentalities is to make a book entry of undistributed profits in the private sector, crediting them to the overseas concerns that earn them, although they never go out of Australia, and bringing them back in on the other side of the public accounts as inflow of capital. Therefore, if we allow for the undistributed profits, we find that a most interesting and critical situation is revealed. If we take the figures year by year and offset the undistributed profits against the net gain on the inflow of capital side we find that in 1947-48 there was a net gain of £6,400,000. There was a net gain in each successive year until 1952-53, the year of great inflation. Then the net gain stopped, and, since then the only year in which we have shown a net gain was the year 1955-56 when the net gain was a mere £2,300,000. In every year since then, if we allow for undistributed profits and this sleight of hand trick practised in connexion with public accounts, in actual fact there has been a net outflow of money in the field of private investment. From the beginning of 1947-48, there has been a total net gain of £62,500,000 for a number of years and a total net outflow of £161,400,000, or an actual excess of £98,900,000 of outflow over net gains. In other words, the figures show an effective deficiency of £98,900,000.
– What was the figure for last year?
– Last year there was a net loss of only £500,000 but the year before that it was £5,600,000.
The point I am examining is the one raised by the honorable member for Mackellar who said that if there is a net deficiency in our overseas accounts the only way by which we can get out of the resultant difficulty is by borrowing overseas. I say in answer to that suggestion that public borrowing is certainly better, but private borrowing in the last six years has cost us more on the balanceofpayments side than we have gained, and we have now reached the situation in which that trend will continue. This loan is far too late. No doubt it was decided upon by the Government, some considerable time ago and the machinery for its raising was put into operation, but, by the time that machinery produced results a completely new economic situation had come about in Australia. As the honorable member for Mackellar rightly recognizes, there is an abundance of money in Australia to-day. The big question is not one of shortage of money. All the banks are so full of money that it is a wonder to me that they can close their doors at 3 o’clock in the afternoon. They have so much money that they do not know what to do with it, and they cannot find borrowers for it. The central bank is in a similar situation. It is absolutely unnecessary to undertake the financial burden of borrowing 100,000,000 dollars from the International Bank for Reconstruction and Development at a time when the banking system of Australia is so full of money that it does not know what to do with it. Of course, the honorable member for Mackellar is quite right. This loan is far too late. It is not needed to-day because we have plenty of money in the country and we have unemployed resources. It is not just a matter of recovery; it is not a matter of reducing the unemployment figure some time in the future to the level at which it stood before the credit squeeze of 1960. Certainly we have not reached that position yet. We might reach it some time towards the end of this year or some time towards the middle of next year, but the Government has given no indication whatever of when it thinks we might reach that stage. It is not just a matter of reaching the level that obtained in November, 1960; it is not just a matter of returning the number of our national work-force to the figure at which it stood in November, 1960; it is a matter of recognizing that between November, 1960, and that point somewhere in the future when we will have returned to the November, 1960, figure there has been and will bc a great fall in the level of unemployment and gross national product in Australia. Just what that fall has been is anybody’s guess, but I should think that throughout that period something like 125,000 or 150,000 fewer people have been employed than otherwise could have been employed. I should think too, that it would be a conservative estimate to say that the credit squeeze has caused a drop of between £300,000,000 and £350,000,000 in the value of the gross national product. Why, in circumstances like these, when we have a depressed economy, an economy which is extremely slow in recovering, an economy which has an abundant supply of money for a higher level of activity than exists to-day, is it necessary to borrow 100,000,000 dollars from overseas?
The purpose of this bill is to authorize the borrowing of 100,000,000 dollars from the International Bank for Reconstruction and Development. Up to the time of this loan, our borrowings from that bank have totalled £186,000,000. This loan will raise the figure to £286,000,000.
– Two hundred and eightysix million dollars.
– No, the actual figure is £230,000,000. It will be 447,000,000 dollars. The second point involved in this question is the fact that this loan will make Australia the second largest borrower from the International Bank for Reconstruction and Development. India is at the top of the list with a total of 558,000,000 dollars. Australia rises to second place with 417,000,000 dollars, France comes third with 337,000,000 dollars and Japan fourth with 323,000,000 dollars.
In case the honorable member for Mackellar is not able to accept our argument that this bill is totally unnecessary because there is already ample money in Australia and therefore we should use more of what we have, I remind him of another good reason for opposing it. We of the Opposition have always believed that the International Bank for Reconstruction and Development was not established for the purpose of helping affluent societies of people such as we have in Australia. We believe that the principles on which it was established were those enunciated in 1947 when the late Right Honorable J. B. Chifley, who was then Prime Minister, said -
The purpose of the International Bank for Reconstruction and Development is to provide a source of capital funds for the reconstruction of countries devastated by war-
Presumably that phase is over - and for the development of industrially backward countries. It is unlikely that Australia would itself require to borrow from the bank.
But, of course, in this time of great affluence and prosperity a la Menzies we have reached the stage when we have to put ourselves in the position of an industrially backward country. We are not an industrially backward country; we are backward only politically and, because we are politically backward, we are taking a backward political step in obtaining these loans. We in the Labour Party believe that a country that will borrow from a bank set up to assist underdeveloped countries many times as much as it has put into the Colombo Plan has something wrong with its sense of priority.
This is a point which I am sure the honorable member for Mackellar (Mr. Wentworth) can appreciate, because he would have us believe that it is hardly safe to go to bed at night because of the great danger threatening us from the north. Opposition members believe, as the Labour Party has always believed and as the late Mr. Chifley stated in this House dozens of times, that the only way to deal with insecurity is by economic and social measures. We believe that our opponents in this House and in other places, on the other hand, have always looked to military measures to do this. So we say it is wrong that Australia should draw resources from the International Bank which are needed to give an impetus to economic development in those countries that need it the most.
Earlier to-day the Minister for Air and Minister assisting the Treasurer (Mr. Bury), in a sense, let the cat out of the bag. In introducing this measure the Treasurer said that the proceeds of this loan would be used by the Commonwealth to assist in financing the section of the Snowy Mountains scheme that is now under construction. But to-day his assistant, who knows much more about the International Bank and much more about finance than the Treasurer knows, said that this loan had been tacked on to the Snowy Mountains scheme because the International Bank will lend only for developmental purposes. He added that the real purpose of this loan was, as had been stated by the honorable member for Bruce (Mr. Snedden), to provide an infusion of new capital to the extent of £44,000,000. I carefully noted those words of the Minister assisting the Treasurer. The amount of this loan has been tacked on to the Snowy Mountains scheme so that the International Bank will agree to the loan; but all that this loan does is to provide an extra 100,000,000 dollars in Australia’s overseas funds to be spent on anything and everything in the ordinary process of buying imports for this country. It is to provide a cover of 100,000,000 dollars for importers to bring goods into Australia for resale, not to bring in goods that will be used in the Snowy Mountains scheme. The proof of that statement is contained in the bill itself. In the second schedule to the bill section 3.02 states -
The borrower shall use reasonable efforts to assure that the cost of goods financed, out of the loan is payable in the respective currencies of the countries from which such goods are acquired.
The Treasurer, in the course of his secondreading speech, stated -
While most of the expenditure on the project will be in Australian currency, the loan will be drawn in such foreign currencies as are agreed between the Commonwealth and the Bank (section 2.03 of the Loan Agreement).
The greater part of the expenditure on the Snowy scheme will be met in Australian currency. Probably all the resources required for the scheme will be obtained by the payment of Australian currency. According to the Treasurer, we shall be able to get whatever foreign currency may be determined to be necessary from time to time for the settlement of our overseas transactions. So, as was outlined by the honorable member for Mackellar, this bill has two purposes. First, it affects the availability of funds in Australia for expenditure on the Snowy Mountains scheme. Secondly, it makes available 100,000,000 dollars in the overseas accounts for any and every general purpose.
It is quite unnecessary for us to obtain 100,000,000 dollars from the International Bank or from any source overseas, firstly, because we have a very high level of overseas reserves at the present time, and, secondly, because it is not needed to get the resources to be put to work on the Snowy scheme. This loan will not represent an additional volume of money to be spent in any one year in Australia. It will be expended over the years until 1965 or 1966. The amount could easily be obtained from the central bank at 1 per cent, or 2 per cent, and could easily be spent in the Australian economy without any strain whatever. The resources are in Australia in the central bank if they are not in the private banks. Of course, the private banks have a vastly greater volume of money than they can lend.
This loan money is not needed for the Australian end of the transaction. As far as the other end is concerned - the making available of an additional sum of money in our overseas balances - this, too, is not necessary. The bill will allow the Government to follow, perhaps, a somewhat less deflationary policy than it has been following, and if it does enable and encourage the Government to do that, at least it will have some benefit to the Australian economy. This is an example of how the Government’s thinking on economic matters runs. It is strictly in accordance with thinking in the nineteenth century or in the first 25 years of the twentieth century. It has not, in this respect, even become substantially Keynesian. Surely, if Lord Keynes were alive to-day he would advocate a forthright policy of expansion of the Australian economy, not the policy of creeping deflation which this Government has been following for fifteen months and looks like continuing to follow.
This loan shows that the Government has mis-read the economic circumstances in Australia. For all these reasons the Opposition is opposed to it as a short-cut, easy method which will not succeed in its purpose and which is quite unnecessary in the circumstances.
– Mr. Speaker, I claim to have been misrepresented. The honorable member for Yarra suggested that I was frightened of the tiger in the jungle because I had recognized it as the Prime Minister. That is untrue. I was frightened of that tiger because I recognized it as the Leader of the Opposition. Whilst the Leader of the Opposition may be a little old and not very spry, some of the red-striped cubs behind him are rather more formidable. I make it quite clear that I am not-
– Mr. Speaker, 1 rise to order. I submit that the honorable member for Mackellar is not in order in pursuing that line. He is not clearing up any kind of misrepresentation but is introducing entirely new matter.
– I ask the honorable member for Mackellar to speak to the point on which he claims to have been misrepresented.
– I make it clear that I see no reason to do anything to help the deplorable Leader of the Opposition and his followers to achieve political power.
.- The loan referred to in this bill is for a specific purpose. This was indicated by the Treasurer (Mr. Harold Holt) in his second-reading speech, and that purpose is to further the work of the Snowy Mountains Hydro-electric Authority. The true test of the value of this loan is whether it adds to the productive capacity of Australia. If we look at the Snowy Mountains scheme purely as a power-generating project, I think it will be agreed that this additional sum for the work that is being carried out in the Snowy Mountains will add to the productive capacity of Australia.
It is estimated that the Snowy Mountains scheme will cost some £400,000,000 and that it will yield about £25,000,000 a year in income. It is selling electric power on a peak-load basis at present at rates fully competitive with those charged by thermal stations. It is selling power to New South Wales, Victoria and the Australian Capital Territory at something less than Id. per kilowatt. That is a satisfactory basis on which to lend money and it is also a very satisfactory proposition for which to borrow money.
But there is another aspect of the Snowy Mountains scheme for which the money is being borrowed from the International
Bank for Reconstruction and Development and that is this: Partly, the Snowy Mountains scheme was designed to carry water into the Murray and Murrumbidgee rivers for irrigation purposes. Unfortunately, that work has been held up because the New South Wales Government - a Labour administration, by the way - has not proceeded with the construction of the Blowering dam to which it was committed when it signed the agreement with the Commonwealth. Until such time as the Blowering dam is completed, no progress will be made with the associated irrigation works of the Snowy Mountains scheme. It has been estimated that these irrigation works will add some £30,000,000 to the value of rural output in Australia, and a lot of that money will come from import-saving crops. It will be doubly valuable; but unfortunately it has been held up, not because of any deficiency on the part of the Snowy Mountains Authority but because the New South Wales Government, for its own particular reasons, has not proceeded with the construction of the vital Blowering dam.
This gap illustrates a very important point, and it is just this point that I wish to bring to the notice of the House. For many years, the interests of the Commonwealth Government and the State governments have diverged. This divergence of interest has proceeded at quite an alarming rate since the Commonwealth Government introduced the uniform taxation system and took over other powers during the Second World War. These States are not concerned with spending money so that it will add to the productive resources of Australia. So the Commonwealth has had to spend money in Queensland on beef roads, in Victoria on the standard railway gauges and in Western Australia on the Ord River project. All these are schemes which will undoubtedly add to the wealth of Australia in a short time; but they have been initiated by the Commonwealth Government. The States concerned have found it beyond their power to divert some of their resources towards these necessary works.
I do not think this situation should be allowed to continue. As has been pointed out previously, we are facing a dangerous situation now, especially since the terms of trade have been running against us for so many years, and since the grouping of the industrial countries of Europe and North America are presenting us with an entirely different trading pattern. Our balanceofpayments position will be precarious indeed in the next few years, so far as we can see. So it is vitally necessary that this Government view the situation that is highlighted by the Snowy Mountains scheme as a whole throughout Australia. It must recognize that the States are powerless to deal with the expenditure of money in the most productive way, and devise some overall scheme for applying Commonwealth moneys to raise the productive capacity of Australia.
The pressures that are brought to bear on the State governments are evidently too strong to permit them to spend money as wisely as we consider would be for the most benefit to Australia. In my own district of Gwydir in north-western New South Wales, I have a case in point. Like the Snowy Mountains scheme, we have a border rivers agreement between New South Wales and Queensland. Queensland has taken some action to control the river system there but it has done very little. It has built some weirs but no dam to control the headwaters has been constructed. Weirs built along the river system are of little use unless the head-waters dam is built so that floods can be controlled and the flow of water down the river system regulated. Unless the States can get together, no serious progress will be made with transforming the Upper Darling River system into a highly productive region. This is one case where the Commonwealth Government could and should intervene, just as it should intervene in the case of the Blowering dam on the Murray River.
Again, there is an opportunity for the Commonwealth to intervene in the matter of the Clarence Gorge. This was a matter about which Sir Earle Page used to speak in this House. A dam on the Clarence River above Grafton in northern New South Wales would provide another hydro-electric project of great value because it would serve not only northern New South Wales but also southern Queensland and would provide the resources necessary for the establishment of quite a large industrial centre. There we would have a power supply, a water supply on the spot and a harbour, but unfortunately no progress is being made in this matter because it is under State control. Until the Commonwealth finds a way to take over these tasks which are crying out for attention so urgently we will not be adding to the wealth of Australia as rapidly as we need to do.
To reinforce that point, I shall cite some statements by the Australian and New Zealand Bank Limited. It had this to say in its monthly publication two years ago, and these words are just as true now as they were then - it seems even more important than, perhaps, has been realized that government investment should be managed in absolutely the most efficient way possible.
The bank pointed out in this publication that our rate of productive investment in Australia amounts to about one-third of our capital investment altogether. Productive investment, as the bank remarks, is not to be confused with total capital investment. It is only a fraction of our total capital investment in Australia. For example, money spent on housing and other welfare matters is not immediately productive, however beneficial it may be, and it should not be confused with money spent on irrigation projects or on such things as the generation of power in the Snowy Mountains area. We should have a clear view of what we want our money to do, and we should have an overall plan for the rapid development of the productive resources of Australia.
.- The honorable member for Gwydir (Mr. Ian Allan) said that he believed that our balance-of-payments position could be serious in the coming year. That is generally conceded. I think he should realize that it is the tradition in Australia that while we have a periodical flux with our balance of payments comparatively sound for a very short time, by and large this country has had a very serious problem with its balance of payments. That problem will continue to be serious because Australia is a young country which must have large imports of capital equipment in order to develop. Accordingly, I feel that to a great extent the policies followed by this Government need reviewing. Particularly do I consider that the Government’s policies in regard to our balance-of-payments and borrowing overseas need careful reviewing. That is also the attitude of many thinking people in this country.
The Labour Party opposes this bill basically because the measure represents a further mortgaging of the future of Australia to overseas countries - a policy which is having serious political consequences. We can see the consequences of such a policy in Canada and South American countries where hostility to the lenders of money to those countries is rising. This is human nature. If such policies in regard to overseas borrowings continue to be prosecuted by this Government similar objections will be raised in this country in due course and, in fact, are already appearing here.
I feel also that this bill represents a sleight of hand action, for the money to come from the loan is not really required for the Snowy Mountains scheme. To the contrary, the loan will be simply a means of bolstering our balance-of-payments position and our capital reserves in London. The fact is that the money from this loan will replace, or partly replace, the amount recently repaid to the International Monetary Fund. The Government has repaid money to the International Monetary Fund by drawing on our London reserves, and is now going to replace that money in our London reserves by borrowing, under the present bill, from the International Bank for Reconstruction and Development.
In addition, the money to be borrowed is to be used for the purchase of non-essential imports - not imports of capital equipment for the Snowy Mountains scheme. While the Government continues with the policy of allowing non-essential imports we will have to keep on borrowing to pay for those goods. The Government tries to give this loan an air of respectability by claiming that it is to pay for equipment needed on the Snowy Mountains project, but basically the Government is borrowing this money to pay for such non-essential imports as peas and citrus juices. In other words, the Government would not require this loan money had it limited imports of these nonessential goods. That is the crux of the matter. The expenditure of our reserves overseas on the purchase of non-essential imports has made it necessary for us to borrow from the International Bank to enable us to pay for capital equipment. Had those nonessential imports not been allowed to come into the country and cause a drain on our overseas reserves the capital equipment needed could have been paid for out of those reserves.
The Minister assisting the Treasurer (Mr. Bury) said that this loan was a fresh capital infusion, and to bolster our overseas resources. That statement is an admission of the truth of what I have just been saying - that this loan is not required for the Snowy Mountains scheme, but, in the Minister’s own words, to bolster our overseas reserves. Why do those reserves need bolstering? The answer is, to pay for nonessential imports.
The Minister went on to say that borrowing overseas is the ideal system of borrowing. I cannot quite appreciate the force of that. It is true - and nobody would argue otherwise - that certain types of overseas borrowings that bring to this country technical know-how and give us the ability to produce goods which we would otherwise have to import, can mean an eventual saving in foreign currency and so can be regarded as being sound. The Labour Party does not argue against that kind of borrowing in any respect; but it argues that the great bulk of our overseas borrowing to-day will not benefit our economy, because it will not bring us technical know-how or give us the ability to produce goods which we would otherwise have to import. I could cite many examples of private borrowings overseas, but they do not come within the scope of the legislation and I will not deal with them at this stage. There are, however, many instances of companies involved in overseas borrowings.
Many thinking people in Australia believe that it is time for a reappraisal of the Government’s policies in relation to our balance of payments and overseas reserves and to overseas borrowings. It is important that we should look at the extent to which Australia is now depending upon overseas borrowings to maintain its balanceofpayments position. The balance of payments is, of course, the difference between the cost of our visible and invisible imports and our earnings in foreign currency for our exports. In the year ended 30th June, 1961, our net position in regard to normal items such as travel, exports, transportation, investment, money valuation adjustment, &c, was a deficit of £368,000,000. In other words, this country spent £368,000,000 more than it earned. That is the crux of the position. We made up the difference by borrowing from official sources such as the International Monetary Fund and through general loans to the amount of £82,000,000. This, plus private investment in Australia from overseas amounting to £228,000,000, less adjustments of £223,000,000, left a net gain of £39,000,000. We turned a deficit of £368,000,000 into a net gain of £39,000,000 in the year ended 20th June, 1961, as the result of overseas borrowings. Those are surely extraordinary figures and surely any government which allows a position such as that to continue must re-assess its policies.
It is important that we realize the extent to which Australia is becoming dependent on overseas borrowings, both private and public, for maintaining its balanceofpayments position. For example, in 1948- 49 private investment in Australia amounted to £36,800,000 and portfolio investment to £1,600,000- a total of £38,400,000. By 1960-61, on the other hand, the direct total investment had risen from £36,800,000 to £176,000,000, portfolio investment had risen from £1,600,000 to £47,000,000, and the total had risen from £38,400,000 to £223,000,000. I point out that portfolio investment is of no use to Australia. Any person with any knowledge of the position realizes that basically portfolio investment is no gain to the Australian economy.
The figures I have given show that there is an ever-increasing dependence by the Government on overseas borrowings. They also show that portfolio investment is increasing at a great rate. It would seem that the time has come for this Government to re-introduce import licensing or to adopt some means of stopping the import of unessential goods. This should be done not merely to protect the industries concerned but more to protect our overseas balances. As the honorable member for Gwydir said, we could have a serious balance of payments problem next year. This is a chronic condition and we must watch it closely.
How a country in these circumstances can afford to spend foreign currency on completely non-essential imports is impossible to understand. If the Government were prepared to restrict the import of non-essential goods, at least £100,000,000 a year would be saved.
– On non-essential imports?
– Yes. If the Government had the courage to face up to this question and to limit non-essential imports, it would not need to borrow foreign currency from the International Bank in order to pay for the import of machinery for the Snowy Mountains scheme, if it can be validly and honestly maintained that that is the purpose of this loan. If we did not borrow in this way, we would be free to choose our own suppliers and would not be told by the International Bank who the suppliers should be. Our bargaining position as a nation would then be greatly improved.
I have already pointed out that some types of capital investment can be of benefit to the Australian economy. The Minister for Air made the point that this money is needed to bolster up our overseas reserves. The loan, therefore, will not be the means of introducing any know-how to the country and it will not mean that we will start to manufacture goods that we are importing. The loan will be used basically to pay for non-essential imports and therefore it does not fall into the category of beneficial capital investment.
The increase of dividend remittances is very important. This is the price that Australia is paying to-day for the dollars that have been borrowed by the Government. In 1948-49, dividends paid to companies totalled £18,800,000, to portfolio investments £3,900,000, and the total was £22,700,000. In 1959-60, the amount paid to companies was £114,100,000, to portfolio investments £7,100,000, and the total was £121,200,000. Surely this is indicative of the policies that are being followed by the Government. In the long term, this situation could have serious consequences for us. As our invisibles increase, we will have to import more, unless we can correspondingly reduce our imports. In ten or fifteen years, this problem could be very serious.
It is interesting to note that this is the seventh loan that the Government has received from this source and the total amount raised is £417,730,000. Previously funds have been borrowed to provide equipment for development and for our airlines. The interest rates have steadily increased from 4i per cent, to 4J per cent., to 4J per cent., to 51 per cent. So I submit, Mr. Speaker-
Motion (by Mr. Roberton) put -
That the question be now put.
The House divided. (Mr. Speaker - Hon. Sir John McLeay.) Ayes . . . . . . 59
Menzies, R. G. Calwell, A. A.
McEwen, J. Bird, A. C
Question so resolved in the affirmative. Question put -
That the bill be now read a second time.
The House divided. (Mr. Speaker - Hon. Sir John McLeay.) Ayes .. ..59 Noes . . . . . . 57
Question so resolved in the affirmative. Bill read a second time. In committee: The bill.
.- I wish to discuss the question of interest payable on this loan. The agreement states that the interest rate shall be 5i per cent. The first loan granted to Australia by the International Bank for Reconstruction and Development in 1950 carried an interest rate of 4i per cent. In other words, the bank’s interest rate since then has increased by 36 per cent. The rate of interest payable on the last loan secured from the International Bank for Reconstruction and Development was less than 80 per cent, of the rate now being charged. The total amount of interest that will eventually be paid will be more than the amount of the loan itself. We are to secure £44,700,000 from this loan, but we will pay back in interest a total amount of about £50,000,000. To take the matter a little further, the amount of interest payable on this loan will be about £16,000,000 more than it would have been if the rate of interest had been the same as that which obtained when the first loan was secured from the bank. We will pay £10,000,000 more in interest than we would have paid if the rate had been that applying to the last loan we secured from the bank in 1956.
When the Treasurer (Mr. Harold Holt) introduced the bill he told us that the rate of interest would be 5i per cent., but, by way of attempting to vindicate the Government’s action, he said that this rate was lower than the Australian long-term bond rate of interest. He said also that the average rate for all the loans secured from the International Bank was 4.8 per cent. However, it is quite clear that on every occasion but one on which we have raised a loan from the International Bank, we could have raised a similar loan here in Australian at a lower rate of interest. Instead of paying an interest rate of about 5 per cent, to our people in Australia, now we are to pay 5i per cent, for this money abroad. We will be paying anything up to £10,000,000 more for the use of the money than we would have had to pay if we had secured the loan within Australia.
For these reasons I say that this is not a desirable loan. It is a loan secured under conditions much worse than those obtaining on the loan market within Australia, and much worse than the conditions that existed in respect of loans secured overseas in the recent past. If for no other reason than that the cost of this money is too high, I believe that our objections to the bill should be upheld.
– The obvious reason for the difference in the interest rate is that when you borrow abroad from the International Bank the money you will get will be money that the bank itself has had to borrow at the prevailing market rate. Sometimes that rate is higher than the rate prevailing in Australia, and sometimes it is lower. It may be more expensive just at this moment, in terms of interest, to borrow abroad than to borrow in Australia, but the point is that you cannot achieve the desired result of increasing your overseas reserves by borrowing within Australia. If you borrow outside you have to borrow at the prevailing market rates. The same conditions apply, of course, in respect of all other borrowers from the International Bank at the present time.
.- The remarks of the Minister assisting the Treasurer (Mr. Bury) serve only to confirm the view of the Opposition that this money should have been raised in Australia. We have advocated that course repeatedly. We have already provided £181,000,000 for the Snowy Mountains scheme directly from revenue, and we believe that this practice should have been continued. I believe the point made by the honorable member for Scullin (Mr. Peters) was well taken.
However, I rise mainly to register my protest against the manner in which this measure has been brought before the committee and the Parliament. I find that the loan agreement was signed on 23rd January, 1961. Looking at the agreement, I find that the bank will make advances of amounts equivalent initially to one-half of the expenditure incurred since July, 1961. This matter has come before the Parliament and the committee in an extraordinary fashion. The measure has been buffeted from place to place on the notice-paper. It has been put at the top of the notice-paper at one time and relegated to the bottom of the notice-paper at another time. Now we find that the debate has been gagged this evening in an unseemly manner while the honorable member for Mitchell (Mr. Armitage) was endeavouring to address the House, and I feel that this important matter has not been given fair treatment.
This bill, Mr. Chairman, deals with an important subject affecting the finances of the nation. Honorable members on both sides of the chamber have been at pains to point out the financial difficulties confronting this nation. One honorable member on the Government side said that this was a measure designed to save us from international bankruptcy. It is obviously the kind of legislation that should command the attention of all honorable members in this place.
The Opposition is not satisfied with the bill. It has voted against the second reading of it. It is content to record its opposition and to let the nation judge whether we should proceed as we have done in the past, financing this splendid project from revenue or from loans raised within Australia. It is true that the level of savings in Australia at the present time is very high. We have been told by Mr. Prowse, research director of the Australian Bankers Association, that there is an amount of about £700,000,000 of overdraft funds available in the country at the present time. The Government itself has proved recently that loan raising can be successful. In these circumstances we feel that we should have proceeded as we have done in the past, raising these essential funds within Australia and relieving the people of the burden of interest and other charges which they will now have to bear, including a charge of 1 per cent, for the flotation. These matters are worthy of careful consideration, and I regret very much that a fuller debate has not been allowed.
.- The honorable member for Macquarie (Mr. Luchetti) does not seem to be able to understand the proposition inherent in this bill, which is that we will make available to ourselves in Australia money for expenditure on national projects which would not otherwise be available to us. The honorable member says, first, that the money should have been raised in Australia. Surely he knows the terms of the amendment to the Constitution with regard to the Australian Loan Council, and that the Australian Loan Council has set out a borrowing programme.
He knows that the £40,000,000-odd Australian involved in the loan was translated into terms of £50,000,000 and approval was given by the Australian Loan Council, which consisted of representatives of the Commonwealth and of all the States. It met with the approval of the Loan Council for the simple reason that members of that body wanted to bring this extra money into Australia for the development of national projects. To deny this loan to Australia would be merely to set back the development of a great national project. Honorable members opposite profess great affection for this great national project and yet they are seeking, by their opposition to the bill, to set back its true development as envisaged by the Government.
– You should listen to the honorable member for Mackellar (Mr. Wentworth).
– I did. The other basis upon which the honorable member puts it is that Mr. Prowse - I forget his exact title-
– He is a member of the Liberal Party.
– He-may be, and if he is, he is a wise man. You should follow his wisdom and join the Liberal Party, too, because there you would learn some reasonable thinking instead of the sideswiping thinking which you display so often. Regarding Mr. Prowse’s statement about £700,000,000 in overdraft funds, does the honorable member for Macquarie suggest that the Commonwealth Government should go to the private trading banks and seek an overdraft for the construction of the Snowy River-Murray River section of the Snowy Mountains scheme? It is a stupid proposition to put to the committee. 1 say that with all respect to the honorable member for Macquarie, because he is being stupid on this issue. To suggest that the Commonwealth Government should go to the private banking system for an overdraft in order to finance the Snowy Mountains scheme is to overlook completely the realities of the situation. For all these reasons the only way in which we can reasonably and properly develop this great national project, without that development in any way limiting our capacity in other spheres of national development, is by taking advantage of this International Bank loan.
– The honorable member for Scullin (Mr. Peters) asked some questions about the interest rate, and I will answer them as best I can. The average interest rate paid on all Australia’s loans from the International Bank loans is at the moment about 4.8 per cent., which is less than the current bond rate.
– The Minister said that in his second-reading speech.
– He did, but it does not seem to have sunk into the minds of honorable members opposite, and that is why I have repeated it. The loan is to be repaid, over its life, in instalments. The interest, which is payable only on the outstanding balance, is less than the actual amount of the loan- perhaps 80,000,000 dollars or 90,000,000 dollars. If you assume that the average life of the loan is about twelve years, the interest bill would be about 70,000,000 dollars. I moveThat the question be now put.
Question put. The committee divided. (The Chairman - Mr. P. E. Lucock.)
Question so resolved in the affirmative. Bill agreed to.
Bill reported without amendment; report adopted.
Motion (by Mr. Bury) proposed - That the bill be now read a third time.
Speaker- y - -~t*
Motion (by Mr. Bury) put - That the question be now put. The House divided. (Mr. Speaker - Hon. Sir John McLeay.)
Majority .. .. 2
Question so resolved in the affirmative.
Original question resolved in the affirmative.
Bill read a third time.
Debate resumed from 5th April (vide page 1366), on motion by Mr. Adermann - That the bill be now read a second time.
– Order! There being no objection to the proposal of the Minister, that course will be followed.
.- This bill and the two other measures mentioned by the Minister for Primary Industry (Mr. Adermann) relate almost entirely to a proposal to continue the existing tax levied upon wool for the purpose of promoting the sale and use of wool. The House will recollect that in about the year 1955 members of the Opposition became deeply disturbed about the continuing fall in the price of wool in the world’s markets. By asking a series of questions, they aroused such interest as ultimately resulted in the appointment by the New South Wales Government of a committee to inquire not into the promotion of the sale and use of wool but into reasons why the Australian wool producers were not getting the price which, in the opinion of some people, they were entitled to receive. Following the report by Mr. Justice Cook to the New South Wales Government, there arose in the minds of those people who did not want any change in the then existing system of marketing the thought that it would be a good idea to divert the mind of the Australian wool-grower, who was then worried about the selling system, away from the question of marketing arrangements to that of promoting the sale and use of wool. Following that agitation, the chairman of the Australian Wool Bureau, Sir William Gunn, as was his bounden duty, embarked upon a campaign of advocating to the woolgrowers’ organizations of Australia that they should agree to support the imposition of an additional levy on every bale of wool produced. The levy at that time was about 5s. a bale. Sir William toured all over Australia addressing public meetings and meetings of wool-growers. At some of those meetings he received a very hostile reception. Many growers and representatives of branches of growers’ organizations protested angrily at the suggestion that increased expenditure on promotional activities would solve the major problems of the industry. Eventually, however, the persuasive powers of Sir William Gunn and those who assisted him prevailed. He was assisted, perhaps not financially but certainly morally and by way of propaganda, in his agitation for additional money for promotional activities by the National Council of Wool Selling Brokers and the conservative graziers’ organizations. He did not have such an easy passage when it came to members of the wool and wheat producers’ organization in Victoria nor when he came to deal with wool-growers’ organizations in Western Australia and South Australia. However, he went out on that campaign most vigorously and, no doubt, most successfully.
The Australian Wool Bureau of which Sir William Gunn is the chairman, engaged an organization in Melbourne called Personnel Administration Limited of which, I understand, Professor Copland was a distinguished director. I think it was £23,000 that the bureau agreed to pay in order to send a couple of members of Personnel Administration Limited around the world on a tour to ascertain what was wrong with wool marketing and wool promotion methods. When Personnel Administration Limited presented its report I asked a question about it in this House. I found that the report was in favour of increased promotion and the raising of funds for that purpose. This firm had had £23,000 out of the woolgrowers’ funds so, of course, it was essential to get more money.
– On what date did this happen?
– Not more than eighteen months ago. When I asked the Minister for Primary Industry, who is in charge of this measure to-night, for a copy of the report to which I have referred I was informed that it was so voluminous that I could be supplied only with a summary. This Parliament has never seen this report which cost £23,000, nor can I obtain a copy of it.
– Who paid for it?
– The Australian Wool Bureau.
– Then why are you entitled to look at it?
– Because I happen to be a wool-grower. I am also entitled to see it as a member of this Parliament, because this Parliament gives to the Australian Wool Bureau the statutory power to engage in this form of work. The Parliament exercises control over the bureau’s finances, provides for an audit of its funds, and, under certain circumstances, subsidizes the bureau. Why is the honorable member for Barker (Mr. Forbes) apologizing for this secrecy about wool promotion? ls he afraid of the truth? Even the honorable member for Wakefield (Mr. Kelly) has not been able to obtain a full copy of the report. The sum of £23,000 was paid to find out something that could have been found out much easier and at much less cost.
Following upon the agitation for an increased levy last year, the two federal organizations compromised, .eventually the growers, some with great reluctance and some with great willingness, agreed to increase the levy to 10s. a bale for twelve months in order to bring additional revenue into the Australian Wool Bureau. We know that the Wool Bureau wanted the tax to be £1 a bale instead of 10s. The increased tax was limited to twelve months because, with all the hubbub about allegations of unsavoury practices in the sale of wool, the Government was afraid to tackle the subject. So it appointed a committee to inquire into the Australian wool industry.
Of course, that was a stunt which originated in the mind of the Government - I am not sure about the Minister for Primary Industry. The Government thought that if it appointed a committee to inquire extensively into the wool industry it would be able to stall for twelve months, and appease the growers. In this way the Government hoped to get past the election period and escape very awkward questions. The Government knew that it would be asked by wool-growers’ organizations why it had not taken a poll of wool-growers to ascertain whether they were in favour of an organized marketing system.
The Government did not get through the general elections as well as it had expected to get through it. It appeased the woolgrowers temporarily and then the great report was presented. What did we find? The report reported against any change in the wool auction system as we know it. It reported on the subject matter of this bill - promotion and research - very extensively as well as on wool-growing. Then it evaded its responsibility. It suggested the setting up of a supreme authority to deal with three factors involved in wool production and selling. By innuendo, if not directly, it suggested that the existing Australian Wool Bureau operating independently as at present, is not a satisfactory organization. In addition, it suggested that the research authority is not, as an independent unit, functioning as it ought to function. Then the committee of inquiry had a brainwave. More appeasement! It suggested that there was no statutory organization observing and reporting upon the marketing of wool. Then it said, “We think there is a lack of co-operation between the two existing organizations. Their activities ought to be co-ordinated and there should be an additional organization on the selling side, not physically to handle the wool or market it, but to peer around corners and report”. More shilly-shallying and more delay!
Lo and behold, the authority that was to co-ordinate the three separate organizations dealing with promotion, research and marketing, was to consist of eight men! Of course, the wool marketing committee of inquiry dodged the responsibility that this Parliament and the Government had placed upon it thoroughly to investigate every aspect of wool marketing and to prepare a concrete and specific report on marketing. The committee was not vested with the powers of a royal commission. It had no power to call witnessess or send for papers, and no power to take evidence on oath. That was a most serious state of affairs because, in the absence of those powers, it could not summon employers or employees in wool brokers’ organizations. It could not compel such people to produce files containing documents from firms which had bought wool at specific sales. These, of course, would have indicated that, on many occasions, one buyer had bought for a dozen overseas firms, thereby eliminating competition. The committee stated with regard to selling organizations - not the physical sale but an inquiry into selling and marketing - that among the functions these people should have was one - to seek the appointment of a Royal Commission on matters in which it is unable to pursue its inquiries to satisfactory conclusions under other powers.
So the members of the committee recommended the setting up of a commission with the powers of a royal commission, which the committee appointed by this Parliament did not have. When the committee referred to some other aspects of the industry, it pointed out that as a committee, it had no compulsive powers to demand facts or figures. With regard to certain allegations, the committee stated that so far as it could ascertain from expert opinion, the loss to the growers on certain wool activities - I cannot name them or I may transgress the Standing Orders - was estimated at anything from .16d. to .32d. per lb. The point I want to make about promotion is this: If one takes the .32d. per lb. that, in the absence of compulsive powers to produce exact information, was estimated to be lost by the growers, and if one takes that amount as .33d. for purposes of easy calculation, that is equal to one-third of a penny. At the rate of onethird of a penny per lb., the total loss by the growers on the activities of certain organizations would total about £2,250,000, or roughly 8s. 4d. a bale.
That does not sound much in terms of bales, but 8s. 4d. a bale is only a little short of the 10s. tax on each bale which has been imposed for promotion purposes. If that end of the wool-buying business was tightened and the loss of .33d. per lb. eliminated, there would be no need to continue to drag 10s. a bale out of the wool-growers. So honorable members can see how important it is that this Government should have attended to that end of the activities of the wool industry long ago. To that section of the industry, according to moderate expert opinion, there seeps 33d. per lb. or 8s. 4d. a bale every year that should go to the Australian wool-growers.
Pursuing the story of these activities we find, after all the propaganda about the contraction of markets - and I am not detracting from promotion at all because the Labour Party supported the 10s. tax last year - that the experts, forsooth, now say that there is no real difficulty in marketing our wool. As I have said, this was discovered after all the propaganda had been issued, with success, and after the federal wool-growers’ organizations had supported the imposition of the levy.
In support of this statement about marketing, I shall make some quotations. Sir William Gunn, Chairman of the Australian Wool Bureau, said in an exclusive interview with “Muster” that the answer to the wool problem was greater productivity. When the pressure was on about the paramount importance of promotion, instead of the paramount importance of marketing organization, one would have thought that we were condemned and that unless we had promotion, we would not be able to sell the wool we had on the world markets. Now we are told: “ It is not so much a matter of selling the wool; you are not growing enough. Get busy and grow some more.” Sir William is reported to have said in this interview -
Increased productivity would both help to reduce the pressure of the cost-price squeeze and to provide a greater volume of wool to meet the demand expected from developing markets in Asia.
We knew that markets were developing in Asia long ago. Sir William Gunn also said -
If satisfactory returns were not forthcoming, producers would switch from woolgrowing to other lines of primary production in which the returns on capital and effort would be higher or at least, more assured . . . This line of action could be disastrous from a national point of view.
Approximately 95 per cent, of the Australian wool clip was exported and realized between £300m. and £400m. annually in foreign currencies required to pay for imports essential to Australia’s economic development . . ,
In the main, these markets are in China and other relatively undeveloped Asian countries.
These arc low income areas and we would gain little through the promotional activities the International Wool Secretariat plans for these countries if wool were priced beyond the reach of consumers.
Previously it was essential that the work of the secretariat should be speeded up; but let us look at this question of pricing wool beyond the reach of consumers. This is directly connected with promotion because if wool cannot be sold at a payable price, it is futile to worry about promotion. We hear talk about the lack of purchasing power among the people of Asia. Let us look at the facts. What does Id. or ls. per lb. mean in relation to wool prices? It does not mean much to the individual even in Asia. I have an estimate that was published in the Quarterly Review of the Bureau of Agricultural Economics. That worthy journal points out that for a suit of clothes that sells at £25, the amount of greasy wool required is 5.6-lb. At 82d. per lb., the cost totals £1 18s. 6d. That is the cost of the raw greasy wool in a suit of clothes.
If the price of that 5.6 lb. of wool is increased by ls. per lb., it does not mean much on a suit of clothes costing £25, either to an Oriental or a European. In fact, it means 5s. extra to a citizen of Japan or a citizen of Australia. It is estimated that a citizen of Japan works a fortnight to earn enough to buy a suit and a citizen of Australia works for one week to buy a suit. All this nonsense about the likelihood that we could not sell wool in the markets of the world unless we had an extravagant promotional campaign does not hold water.
Sir William Gunn is not the only one to comment on these matters. The Melbourne *’ Sun News-Pictorial “ reported on 23rd December last -
Wool prices could rise because of an expected increase in world consumption, the Bureau of Agricultural Economics said to-day in its annua] wool outlook survey . . .
The bureau says that world wool consumption in 1960 was estimated at 3,200 million lb. clean, and on present trends it could be about 3,200 million lb. in 1961.
It sums up the position in consumer countries as being: -
Japan: Upward trend of consumption should be resumed when present economic difficulties there are overcome.
Britain: Buying seems likely to rise.
U.S.: Increased wool textile sales can be expected.
Europe: Outlook in Common Market area must be regarded as satisfactory because of generally rising levels of incomes and employment.
Russia and China: Recently suffered a decrease in domestic production which should lift their demand for wool imports.
So, as far as availability of markets is concerned, they are there on the spot. We say that the essential problem to-day is whether to continue this levy of 10s. on wool. This party does not object to promotional activities or to the continuation of this levy, but we are endeavouring to point out that this Government should attend to first things first. Even if the levy is continued into the ensuing year in a market where, as to-day, there is comparative buoyancy, the question is, for how long will that buoyancy last before people at both the selling and the retailing ends of the show take advantage of all we have done in promotional activities and rip off the benefits just as fast as these benefits are made possible by promotion? That is what is going on in the world to-day.
I have here an article which shows how you can easily lose all the advantages of your promotional activities unless you tie up certain other essential features of wool production and wool selling. This article is from the Bradford “ Wool Record “, and it is very illuminating. It appears under the heading “ Topics of the Week “ and has a side heading “ Price-cutting in wool garments “. It reads -
Resale price maintenance does not often come prominently into the reckoning when wool textile goods are sold by retail, but the matter has been brought very much into the news by the report that Tesco’s new Leicester supermarket is selling certain branded wool garments at less than the agreed - or, to be more accurate, the stipulated - price. (See “Price-cutting Row in Women’s Clothing Trade,” on page 23.)
I turned to page 23 and found the following paragraphs in an article there: -
The irony of the row at the moment is that it comes at the period when manufacturers and retailers have been congratulating themselves on achieving higher “mark-ups”. For some weeks past, the trade has been counting the number of houses who are allowing up to 60 per cent. Discussion has ranged on whether this is really justified, and, on the whole, the decision is that it is if it allows the retailer to order up, to order wider ranges, non-popular lines, and to give a better service.
The main factor is that with 60 per cent, the retailer will indeed order up; giving better service is not necessarily part of the deal.
Until recently 334 per cent, has been usual on women’s outerwear and dresses; 50 per cent, has been achieved by a number of retailers and 60 per cent, was coming into fashion. Now Tesco has reduced the mark-up to 25 per cent.
So you can see that unless you control the selling end, just so fast as those people are powerful enough to do it through their buyers and manufacturers and other people who handle wool they snatch away the benefit at the selling end.
– How can you control the selling end?
– I will leave that to your imagination. As a member of the Country Party you should know that for a long time controlled marketing of wool has been advocated by members of the rural community, if not by you as a member of the Country Party.
– Not at the retailing end, though.
– No, but to the extent that they can impose their total charges on the retail market, so they are able to charge a much higher price in the United Kingdom, and Japan for that matter, leading to mighty high retail prices in the stores. A point may be reached at which they might kill the whole scheme for the marketing of their product. I am suggesting that promotion can be justified notwithstanding the fact that we have no difficulty in selling all our wool every year. If we ceased our promotional activities altogether there might be a diminution of sales. It is noteworthy that the monopolists in this world - the people who control the retail and wholesale ends of oil selling, for instance - Spend vast sums of money in advertising their products although they are probably all linked in a very tight cartel. Whether they are just kidding people along I do not know, but the fact is that they spend a lot of money promoting sales of oil and petrol. If that is justifiable in a case where there is an almost total monopoly, there is some justification for expenditure on the promotion of the use of wool.
I end on the note that there is great heartburning among thousands of woolgrowers in Australia to-day because the report of the committee of inquiry into the wool industry has left them high and dry and no nearer to-day to getting hold of the sales end of their own product per medium of an “ organized marketing scheme than they were ten years ago when this Government took a poll of the growers and took good care to ruin all prospects of the proposal being carried affirmatively.
– That is not correct.
– Yes it is. To refresh the honorable member’s memory let me tell him about the approach to the measure introduced into this House imposing a provisional tax of 7i per cent, on growers in anticipation of an affirmative vote in the organized marketing poll. In the very year in which that tax was imposed as a justifiable levy the then Treasurer, Sir Arthur Fadden, in his Budget, before the poll was taken imposed a deduction of 20 per cent, on the gross returns of the wool-growers, and those who were evilly disposed towards orderly marketing represented to the growers that if they voted for orderly marketing they would continue to suffer the 20 per cent, deduction plus the 7± per cent, tax for ever afterwards. The woolgrowers were deceived into voting for what would to-day have proved to be a very satisfactory wool marketing organization.
I support the bill, and at a later stage I will move an amendment which, I hope, will be accepted by the House, because I believe that it is in conformity with the Standing Orders.
– What is the amendment?
– You will hear it later when I move it.
.- As the Minister said in his second-reading speech, and as the honorable member for Lalor (Mr. Pollard) has repeated, the issues involved in this bill are fairly simple. The point of the three bills is simply the question whether or not the levy of 10s. will be retained until 30th June, 1963. That being the case I think it would be going beyond the scope of the measure to embark upon a great discussion of the report of the committee of inquiry into the wool industry on which the honorable member for Lalor spent so much time. However, I think it is necessary to refer to some of the statements that the honorable member made. First, I shall refer to his remarks on the economic survey which was conducted for the Australian Wool Bureau by Personnel Administration Proprietary Limited. Certainly the report is still a confidential document. I do not think it is contrary to normal business practices for a confidential report to be reserved to the organization most vitally concerned with it. I inform the honorable member that I also tried to obtain a copy of the document but was unsuccessful.
The honorable member also implied that it was the Government’s idea that this committee of inquiry be established. This is not quite correct. On 26th January, 1961, the Prime Minister (Mr. Menzies) said -
Late last year I announced that in view of the importance of the wool industry the Government had agreed to the request of aU the federal wool growing organizations that an enquiry be arranged into Australian wool marketing methods.
He rather regretted that the committee did not have the powers of a royal commission. He said that it lacked compulsive powers. The Prime Minister offered these powers to the committee, but the committee did not think it necessary to have them.
On the subject of promotion generally, the honorable member for Lalor said - he may correct me if I am wrong - that we cannot sell at a satisfactory price, so why should we consider promotion. That to me was a rather remarkable statement. I should have thought that that was a perfect ground for the conduct of promotion schemes. However, as I said, I do not think it relevant in a debate on this bill to delve too deeply into the report of the committee of inquiry.
A large proportion of wool-growers throughout Australia support the bill. At a meeting in Melbourne last week, the woolgrowers agreed that the levy should be proposed. In my view, this is a sufficient ground for honorable members to support the bill, and there is little point in Opposition members making a political issue of it. There is nothing political in the bill. This being so, I think it is necessary to make a few relevant observations on the general subject of promotion. Because the wool-growers’ organizations have agreed to the levy, I support the bill, but I must confess that I give it limited support for the reasons mentioned by the honorable member for Lalor. I would be breaking faith with many growers in Western Australia if I failed to draw attention to some of the views and contentions they have expressed.
At the beginning of the year, the wool section of the Farmers Union of Western Australia held a conference. This union represents the growers of 82 per cent, of the wool grown in Western Australia. They were not satisfied with the report that has been referred to. They were prepared to meet representatives of the Australian Wool and Meat Producers Federation in Melbourne for further discussions.
– Finish on that note.
– No, there is a good deal more to come. The conference of the wool section of the Farmers Union passed a resolution in the following terms: -
Conference emphatically rejects the proposals to contribute increased levies for wool promotion until the implementation of a marketing Reserve Price Plan and instructs its delegates to the forthcoming Federation Conference to strongly oppose extension beyond June, 1962, of the increase of Ss. per bale agreed to for the current year.
– That is our amendment to the bill.
– If it is, I hope honorable members will bear in mind that most of the wool-growers have agreed to this levy.
– Why did you read out that resolution then?
– Because it happens to be the view of the wool-growers in my electorate.
– You are not unanimous
– I do not claim to be the spokesman of the organization I have mentioned, but I am sure honorable members will perceive that the question of promotion is best considered together with the question of marketing and particularly of marketing reform. Therefore, opposition to this proposed levy is not intended in any way to be opposition to the principle of the full and completely effective promotion of the product. I quote the recommendation agreed to at the joint meeting of the organizations held on 9th and 10th May, 1961, which is contained in the annual report of the Australian Wool Bureau. It is in these terms -
That the Australian Wool and Meat Producers’ Federation and the Australian Wool-growers’ and Graziers’ Council agree to recommend to their members that the levy for wool promotion and research be 12s. per bale for one year only, to apply as from the first sale after the winter recess 1961, and that the levy be reviewed at a Meetng between the Bureau, the Australian Wool and Meat Producers’ Federation and the Australian Woolgrowers’ and Graziers’ Council not later than March, 1962, with the knowledge of the findings of the Wool Inquiry Committee and that the legislation be amended accordingly.
Obviously, the desire for promotion is simply to increase demand. This is a means to an end, the end being increased prices or increased net returns to the growers and to this country. This applies whether we refer to the current production or an increasing production for which we have an enormous potential. This being so, the majority of growers, as shown by the resolution of the Western Australian conference, contend that prices, or more correctly the net return, can also be increased by certain changes in marketing procedures. We are not prepared at this stage to say what those changes should be. My own view is that’ improved productivity is possibly more urgent.
There are, I believe, very powerful reasons supporting these contentions. The first is that official sanction is given to an increase of production costs. There are signs also, as the Minister indicated in his second-reading speech, that just as the levy increased from 6d. in 1936 to 10s. in 1961, so it will increase in the years ahead if we are to meet our commitments to the International Wool Secretariat. I would like to refer at this stage to a statement made by an authority on this subject, Professor Campbell, who is Research Professor in Agricultural Economics at the University of Sydney. He said -
On present indications, producer groups are likely to spend even greater sums on advertising in the coming years. One manifestation of this is the move currently afoot in the wool industry which, if it comes to fruition, will mean that the levy placed on graziers for promotional activities will increase until in 1966-67 it will be 260 per cent, higher than in the current year.
That was last year. Quite obviously, Sir, the purpose of promotion is simply to increase the demand for wool, as I have said. Promotion such as is envisaged by Professor Campbell is undertaken because that demand is thought to exist. I emphasize the words “ thought to exist “.
May I again repeat that neither I nor the growers in Western Australia are in any way opposed to this principle of promotion or to any measure which will increase the sales of wool. But there is something rather nebulous, I think, about this promotion by the producers of a finished article at the retailing level. The wool-grower, unlike his manufacturing or retailing counterparts, cannot add that cost to his selling price - at least, not under the present selling system. Some very well informed opinions have been expressed also about this kind of promotion, and I would like to refer honorable members again to some comments made by Professor Campbell. Referring to the need for primary producers to keep a balanced perspective on the promotion of agricultural products, he said -
They should resist any temptation to surrender to the “ marketing experts “ major decisions on the extent of advertising expenditure. If they don’t, they may eventually awake to discover that their expenditure on promotion has simply served to swell the incomes of advertising agencies and the owners of the media used for promotion, without bringing substantial benefit to themselves.
I do not wish to suggest that Professor Campbell was necessarily referring specifically to our current schemes for wool promotion in that quotation. However, I think that that is a warning which may well be heeded by responsible growers and the organizations to which they belong.
This brings me, Sir, to a consideration of what is meant by Professor Campbell’s concluding phrase, “ without bringing substantial benefit to themselves “. The wool promotion levy has been in existence, as I have said, for something like 25 years. I do not think it can be denied that the International Wool Secretariat and the Australian Wool Bureau have well and truly justified their existence. The results that they have achieved are most impressive. Unfortunately, those results are so far removed from the scene of the sale of the growers’ product as to make it difficult, if not impossible, for the individual grower in any way to assess the value which he receives for his contribution to the fund. Surely, in any other industry, the principal operator would make himself completely aware of whatever benefits might accrue from this kind of contribution. I ask the Government and the bureau to consider taking steps to enable the members of the growers’ organizations to be well informed. I am aware that in this instance the bureau has circulated numbers of reports and summaries of surveys. But these, apparently, remain unconvincing.
I would like now to return to an aspect of this proposal which I mentioned before - the grower financing the promotion of the sales of his product when the results can be determined only at the retail level. All other operators in the wool trade, at every level, work on percentages and profit margins. I do not think that there is anything wrong with this. I think that they are perfectly justified in doing so, and I would certainly at all stages defend their right to operate in this fashion. But I am equally of the opinion, Sir, that there should be some arrangement under which the contributions of those other operators, also, can be obtained for this sort of fund - I may add, without necessarily increasing the final price of the product at the retail level. That, for obvious reasons, would perhaps arouse a good deal of further buyer resistance.
I am aware, as the Minister for Primary Industry stated, in his second-reading speech on the Wool Tax Assessment Bill, that about £1,000,000 has been contributed by sections of the wool textile industry in various countries for promotional activities jointly with the International Wool Secretariat. The latest annual report of the Australian Wool Bureau shows that in France the trade contributes equally with the secretariat to the total expenditure of £1,000,000 on the promotion of pure combed wool. In Japan, the levies imposed on the trade will eventually raise half of a total expenditure of £500,000. In the United Kingdom, grower contributions total £100,000. Amounts received from the trade will bring the total to more than £250,000. These may seem considerable sums, but I suggest that they are not anywhere near as great as are the amounts which are expended on the promotion of fibres which compete with wool.
The final aspect of this bill which I wish to discuss could probably have been dealt with more correctly at the beginning of this speech. I refer to the actual justification for any promotional activity. This brings me to a point which was mentioned by the honorable member for Lalor, who said that we must know where the demand exists and why there should be any promotion at all. For instance, Sir, I believe that it is absolutely necessary to know whether there is any scope for increased sales or increased prices. Having explored this situation, we must justify the expense of that investigation by the resultant improvement in the industry. It may be claimed, for example, that, in the past, promotional activities have been responsible for the increased returns which have been obtained. But this issue is somewhat confused, because, as we know from a statement made recently by the Minister, there have been certain other favorable circumstances.
– Prices have been a little better.
– That is right. Japan took £12,000,000 worth more than in the corresponding eight months of last financial year. Mainland China increased her purchases by something like £9,300,000. This was two and one-half times the purchases of the corresponding period of the previous financial year. The countries of the European Economic Community, also, increased their purchases. But we have no way of knowing whether these increases accounted for our higher prices or whether the promotional activities undertaken by the Australian Wool Bureau and the International Wool Secretariat were responsible. I suggest that only by undertaking intensive market research such as I have suggested will it be possible to determine these matters.
I am rather pleased to see, in the latest annual report of the Australian Wool Bureau, that the Director of Economics of the International Wool Secretariat submitted certain recommendations to a meeting of the board of the secretariat in May, 1961. I refer to those that are most relevant to my argument, Mr. Speaker. He recommended, first, the optimum allocation and utilization of the available funds to achieve the maximum possible increase in the world demand for wool, and, secondly, research into the best methods of measuring the effectiveness of promotional work both globally and on a regional, country or campaign basis. The meeting stressed the importance of this project and the assistance which it would give to promotion throughout the world. It may be considered that I have dealt with this matter rather late in the piece, Sir. This factor is full justification for any steps in promotion which may be undertaken by the growers’ organizations.
Contentions have been raised by certain growers and, in particular, by the wool section of the Farmers Union of Western Australia, which, as I have said, is prepared to give the bill limited support. I support the bill for what it will do, because, as I have said, I am in favour of promotion, and so are the growers in Western Australia. But my support for the bill is qualified to a certain extent, first, by the desire of the growers to know from this marketing research whether the results justify the expenditure on the promotion. My support for the bill is further qualified, secondly, by the contention that other benefiting sections of the industry should also contribute in proportion, and, thirdly, the ultimate objective of promotion being to increase grower and national returns, because it is possible that even greater benefits might be obtained from marketing reform and increased productivity.
On that note I complete my address.
– Hear, hear!
– From the interjections of the honorable member for Grayndler and other honorable members opposite it is obvious that my views are different from those of honorable members of the Opposition. However, they have said that they support the bill and that they support the idea of promotion. This, in essence, is what I have done. I have put forward these contentions, which I believe are quite relevant, and I hope that they will be taken into account in the discussions with the various organizations involved.
Debate (on motion by Mr. Duthie) adjourned.
That the House do now adjourn.
.- I wish to bring before the House the matter of the pollution of George’s River. This may appear to be a local matter or a State matter, but I think there are a few reasons why I should bring it before this House. One is, of course, that I have been asked to do so by some of my constituents.
Another is that I believe some of the departments of the Commonwealth could be in some way responsible for the pollution of the river. The other reason is that I think it is advisable to bring an important matter such as this, involving the pollution of a river, before the notice of the National Parliament. The Government may be able to do something about it. I hope that it can.
The Bankstown Municipal Council recently decided to close all swimming enclosures on the George’s River within its boundaries. These included the enclosures at East Hills, at Lambeth-street, Panania, at Picnic Point and at Coleman Park. The Chief Health Inspector of the council said that samples collected on two occasions, at different tides, from the bathing enclosures in George’s River showed heavy bacterial contamination of excreta origin. He said that, taking into account the origin of the pollution, the waters could not be regarded as altogether desirable for swimming. He said he considered it most likely that the main sources of the pollution were effluents from sewerage works outside the Bankstown Council area. He also said that with the growth of population as the result of industries developing in the Liverpool and Fairfield districts, the pollution must get worse.
I think that this Government, or at least some of the Commonwealth departments, should be interested in the problem. The departments to which I refer are the Department of the Army, the Department of the Navy and the Department of Immigration. The Department of th? Army has extensive military establishments at Holsworthy. The Department of Immigration has an immigrant hostel at East Hills, on the banks of the river. The Department of the Navy has a housing establishment for its personnel and their families at East Hills. All these establishments are close to George’s River and its tributaries, which include Prospect Creek and Williams Creek. Excretal effluents from faulty sanitary systems at these establishments must eventually reach George’s River, by seepage or other means. I am reliably informed that many of the septic systems in use at these establishments are unreliable, and that they are not cared for as well or cleaned as frequently as is necessary.
One thing is certain: The river is being polluted, and we must try to discover the origin of the pollution. I therefore ask the Minister for the Army (Mr. Cramer), the Minister for the Navy (Senator Gorton) and the Minister for Immigration (Mr. Downer) to have their officers examine the sanitary systems in the areas for which they are responsible, to make sure that the trouble is not originating in those systems. I believe that all public authorities with sanitary systems in the area should have them checked in an attempt to find the cause of this contamination. I suggest, too, that the Ministers I have mentioned should ask the Commonwealth Department of Health to assist in these investigations.
The prohibition of swimming in George’s River is not the most serious aspect of the matter. Some of the best oyster farms in Australia are only 4 or 5 miles down the stream from the point at which the Chief Health Inspector made his test and found heavy bacterial contamination. This part of the river is also one of the most popular fishing and speed boat resorts in Australia. If this polluted condition is not soon corrected, we may find that a great oyster and fishing industry will be destroyed. In addition, of course, many swimming enclosures will be permanently closed. Thousands of people who have previously used boats on the river will hesitate to do so in future. It is for these reasons that I ask the various Ministers to have investigations made, with the help of the Department of Health, in order to prevent further deterioration and to find a remedy for the trouble that has already occurred. We do not want George’s River to become like the Potomac River in Washington, in the United States of America. That river is a good deal larger than George’s River, and it is lined with notices prohibiting fishing and swimming. We do not want this to happen on our George’s River.
In addition to all the considerations I have mentioned, we should also remember that many people have homes along the banks of the river. Many of them saved for a lifetime so that they could get a waterfront home on this beautiful scenic river. We would not like to see this river become a total loss from that point of view, with a resultant fall in land and home values.
I suggest that the Government could assist in another way, by making enough money available for the Metropolitan Water, Sewerage and Drainage Board in Sydney to provide proper sewerage systems in the affected areas. This would remove the necessity for these individual septic systems that may be the cause of the trouble. If the Government were to provide this money it would help also to solve the unemployment problem for which it has been responsible. It could make enough money available to have the whole of the area sewered. In this way a great river could be saved, and we could ensure that in the future it may be used for the purposes for which it has been used in the past. But this area, to my knowledge, is lacking a proper system because of lack of money. 1 urge the Government to look into the matter from that point of view and say, “ We will save the river by making enough money available “, because the Water and Sewerage Board in New South Wales has the potential, the capacity and the manpower. All it needs is the money to promote this work. I appeal to the Government and I hope the Minister for Supply (Mr. Fairhall) will bring the matter to the attention of the Ministers I have mentioned. If he fails to do so I will send them copies of my speech.
.- Mr. Speaker, I rise to bring a matter before the House and I hope 1 will get the full support of the House as it is not a controversial question. To-day I heard with considerable pleasure, as would all other honorable members from the Sydney area, the announcement regarding the restoration of the Sydney General Post Office clock. I pay tribute to the honorable member for Mackellar (Mr. Wentworth), the honorable member for Bradfield (Mr. Turner) and the honorable member for West Sydney (Mr. Minogue) for their efforts in this matter.
– You should have placed the honorable member for West Sydney first.
– I give him full credit. But what I seek now is not the restoration but the preservation of a very famous naval monument, the tripod mast of the first H.M.A.S. “Sydney”. This tripod mast is situated on Bradley’s Head, a very prominent point in Sydney Harbour. The famous naval monument was taken from the first H.M.A.S. “Sydney”, the first Australian naval unit to engage in sea battle. I think all honorable members will recall - those who are not old enough will have read their history - the famous episode when H.M.A.S. “Sydney” sank the German raider “Emden” on 9th November, 1914 off Cocos Island.
The “ Sydney “ was subsequently scrapped, but prior to that the Katoomba-Leura branch of the Returned Servicemen’s League urged that some item of the equipment of the warship should be retrieved and maintained so that it could serve as a monument to the vessel. A well known Toowoomba bookmaker, William Rankin, bought the mast of H.M.A.S. “Sydney” for- I think- £153.
The tripod mast with a superstructure, which was really a fighting cockpit, was stored at Cockatoo Island in 1929. In 1934 the management of Cockatoo Island sought to get rid of the mast, which was cluttering up the yard. The Mosman council began a move which resulted in the mast being secured for erection at Bradley’s Head. At that time the Department of the Navy played a very important part in securing the mast, and, in fact, did quite a deal towards its erection on Bradley’s Head. The actual dedication ceremony was performed on 24th November, 1934, and was associated with the visit of the Duke of Gloucester. The association of the Department of the Navy with the ceremony may be gleaned from a Naval Order of that time which stated -
H.M.A.S. “ Stuart “ is to pass close to Bradley’s Head, easing to dead slow on approach and not increasing speed till well past. The dedication of the Mast of H.M.A.S. “ Sydney “ will be timed by “ Stuart’s “ movements so that as “ Stuart “ draws abreast, the Commonwealth Blue Ensign will be broken on the Mast and the National Anthem will be played.
I mention that Naval Order because there seems to be some doubt whether the Department of the Navy should have any responsibility in the preservation of this mast. It will be seen from that Naval Order that the Department of the Navy was very much involved, and in fact Captain C. J. Pope, later Admiral Pope, did participate in the dedication ceremony, which was presided over by the Mayor of
Mosman, a well-known local identity, Jack Carroll.
Since 24th November, 1934, the mast on Bradley’s Head has been a well-known landmark. Tribute has been paid to it by a vast number of ferry and sea-going passengers and also by naval, vessels, when passing Bradley’s Head, dipping their Blue Ensigns. So it is a mast with a considerable tradition, which should be preserved.
A recent inspection by naval experts revealed that because of corrosion repairs to the mast, in order to preserve it, would cost approximately £4,490. The Mosman council obviously is not the body which should be held responsible for finding that amount of money. The fact remains that unless that money is found the mast must fall into disrepair and, when it becomes dangerous, will have to be pulled down.
I ask the Government to accept some responsibility in this matter, particularly since this mast has become a monument with a considerable tradition and deep national significance. As I have said, it is the first naval monument to be erected in Australia and in consequence its tradition is very important. The service organizations are very concerned - I feel certain that even the honorable members opposite who are yawning are concerned about the likelihood of losing this famous monument on Sydney harbour. With Anzac Day approaching, and the minds of exservicemen being directed towards an incident of such significance as the sinking of the “Emden” by the “Sydney”, this is an appropriate opportunity for consideration to be given to the preservation of this mast.
I hope the Government will provide the finance necessary to effect repairs and so preserve this famous mast. I hope that what the Government did to-day in respect of Sydney Post Office clock it will also do in respect of the mast of the first H.M.A.S. “ Sydney “.
.- Mr. Speaker, I wish to take this opportunity to answer a bitter attack by the Minister for National Development (Senator Spooner) in another place yesterday concerning the eviction of a man named Jackson from a war service home at Doonside, in New South Wales. In his attack, delivered behind the cloak of privilege, he implied an improper motive-
– Order! I point out to the honorable member that he needs to exercise care. Any reference to a debate in another place during the current session would be out of order.
– The matter arose, not -in debate, but in an answer to a question.
– It occurred in the other chamber.
– It was an attack and he did not seek to prove his statements. It was an attack on the “ Sun-Herald “ and myself because we had the temerity to bring to the notice of the public a decision of the Minister which can hardly be equalled, I maintain, for its harshness and inhumanity. In essence, the Minister’s prepared answer to a Dorothy Dix question-
– On a point of order, Mr. Speaker: Is it in order for an honorable member to debate in this House a question and the reply thereto, or debate in another place?
– I have already pointed out to the honorable member for Mitchell that he would not be in order in doing so, but he has continued along the same line. I ask him to observe the ruling of the Chair.
– I will content myself with stating the facts of the case. The facts of the case are these: Mr. Jackson was given a home, incorrectly, by an officer of the War Service Homes Division and, legally, the division is responsible for its actions and for the actions of its agent. Mr. Jackson served in two world wars. He served in the 1914-18 War with the British Expeditionary Forces in France, and he served with the Australian Citizen Military Forces from 1940-46. Under the present policy of the War Service Homes Division, his service in the C.M.F. does not entitle him to a war service home. I have always fully recognized that fact, as has the newspaper concerned. He served in the C.M.F. because he was too old to serve in the other armed forces, but he did serve honorably in both wars. He is 68 years of age, and suffers from ill health. His wife has also now suffered two strokes. She has suffered those strokes since moving into this war service home which is located at Doonside, and which, as I say, was incorrectly allocated to them. Jackson has had to leave work to look after his wife, and the sole income of the couple is a 50 per cent, war pension plus the age pension.
When Mr. Jackson applied for a war service home, he believed that he was eligible for one and he held that belief because, approximately 30 years ago, he had lived in one at Malabar over which he was given an option to purchase. He therefore naturally assumed that he was eligible for a war service home, and that point has not been answered adequately yet. I have always appreciated - and this was made clear in the press report - that he was not eligible for a home. But that was not the point raised in the press and by me in correspondence with the Minister. Jackson is 68 years of age. He is sick and his wife is seriously ill, having suffered from two strokes, and I feel it is completely inhuman at this stage to evict these people. I asked that they be allowed to stay in the home on a rental basis. This has been permitted in other cases, and it is within the powers of the Minister to grant this request on the compassionate ground that the man is in an almost intolerable situation in every respect. His wife is ill and he is not in a position to seek other accommodation. The Minister replied to my request in these terms -
I have noted that Mr. Jackson is sixty-eight years of age and that his wife recently had a severe stroke, which made it necessary for him to leave work and look after her. I have every sympathy for him, but I regret that I am unable to agree to your suggestion that he be allowed to remain in occupation of the property on a rental basis.
I do not think that shows any human understanding of the position of these people. The Minister went on to say -
I have given very careful consideration to this matter in the light of all the circumstances involved. I have agreed that the Division should withhold any legal action for the time being and that, provided Mr. Jackson vacates the property and executes a mutual release of the contract of sale between himself and the Division, the Division should refund to him his deposit plus the repayment of instalments paid by him, the value of improvements which he has effected- which is approximately £200 - and the rates and other charges paid by him, less a reasonable weekly rental for the period that he has occupied the property.
Mr. Jackson did sign the release, and the amount to be refunded to him is only £375 0s. lid. despite the fact that he paid £340 deposit, has effected improvements to the value of £200, has paid rental for a year, and borne other incidental charges.
The main point about this letter is that there is an implication in it that he could lose his deposit, and Jackson assured me that he had been told emphatically on a number of occasions by the division that unless he undertook to get out without a fight he would lose his deposit. In other words, a form of blackmail was applied to him. It is true, as was reported in the press, that Jackson was given an extension of time amounting to 28 days, but this was given only after an appeal by me to the DeputyDirector of War Service Homes in Sydney and after I had indicated that I was endeavouring to find, and hoped to obtain, alternative accommodation for him. Mr. Speaker, some one had to have a social conscience in connexion with this matter and accept responsibility for this sick man and his seriously ill wife. The Minister showed no understanding of his plight, and agreed to an extension only because he realized that it would be politically dangerous to do otherwise.
The answer which I understand was given to the question asked is substantially a repetition of the facts already stated by me and by the newspaper concerned. The Minister has implied that the newspaper and I have misrepresented the position. That is not so because it was never suggested, at any stage, by me or by any one else, as was implied by the Minister, that Jackson was eligible for a home. I think I have adequately answered that suggestion. I believe that the real position-is that the Minister cannot take criticism and, because the newspaper and I had the audacity to criticize him for his harsh, unreasonable and inhuman decision, he launched into a tirade of abuse in an endeavour to protect himself. I believe that the Minister realizes that his decision does not measure up to accepted standards of humanity and that he is endeavouring to hide behind a coward’s castle of abuse instead of realizing he is dealing with the case of a sick and elderly man and his seriously ill wife who are placed in an intolerable situation which, I repeat, they cannot meet adequately on their own. Somebody has to help them. Even at this late stage I appeal once again to the Minister to exercise some charity in this matter. When I appealed to him in my first correspondence with him, I admitted that there were unsatisfactory aspects in the case and I suggested that it was one in respect of which he had an opportunity to show some semblance of tolerance and charity. I requested then, and I ask again that action be taken to allow these people to rent their home.
– Order! The honorable member’s time has expired.
.- Mr. Speaker-
– I rise to order. Can you tell me, Mr. Speaker, under what standing order I can break down the conspiracy of the Government to prevent me from speaking on the adjournment?
– Order! No point of order is involved. The Minister has been called.
– I had hoped that the honorable member for Mitchell (Mr. Armitage) would accept the explanation given in another place by the Minister in charge of the War Service Homes Division. Had he accepted that explanation given in another place there were illimitable opportunities for him to do whatever lies within his power to relieve the circumstances of this most unfortunate man in this most unfortunate case. Now, however, the honorable member has chosen a different course. He has raised the question in this House, and it is my melancholy duty to refer once again to the explanation which the Minister gave hi another place in connexion with this matter. I can assure honorable members that I’ get no satisfaction from doing it. Had I been in the place of the honorable member for Mitchel], I would have chosen the alternative method of helping this constituent.
Mr. Speaker, it is true that a Mr. Jackson has been asked to vacate a group home allotted to him by the War Service Homes Division. The division has been obliged to take this action because Mr. Jackson was granted a benefit to which he was not entitled under the provisions of the War Service Homes Act. The background to this matter is as follows: -
Mr. Jackson made application to the division’s Sydney office to purchase a group home on 2nd February, 1960. His application was not lodged in the normal manner or through the usual channels. The Director of War Service Homes informs me that his inquiries show that Mr. Jackson, acting on the advice of a friend, contacted an officer of the division whose duties were in no way concerned with the receipt of applications or with advising applicants of their eligibility for War Service Homes benefits.
– Mr. Speaker, I rise to order. Earlier you ruled that it was out of order for the honorable member for Mitchell to discuss a statement which had been made in another place. In this case, the Minister is reading verbatim a statement made by a Minister in another place. I suggest that he is out of order.
– The Minister is in order in this case. I think that if the honorable member for Mitchell had known as much as he knows now he would have been in order, too.
– The officer whom Mr. Jackson approached, acting without authority, took it upon himself to deal with Mr. Jackson’s application and gave an incorrect certificate that he had checked Mr. Jackson’s discharge certificate and found the particulars of his service as disclosed in his application correct. As a result of the incorrect certificate given by the officer concerned, Mr. Jackson was treated as an eligible person and was allotted a group home by the division.
During an investigation by the division into another matter, information was received by the division which led it to check with Army records on Mr. Jackson’s military service. This check revealed that Mr. Jackson’s service with the armed forces did not, in fact, qualify him to receive assistance under the War Service Homes Act.
I might add that the officer concerned was also involved in another case where the eligibility of the applicant had been incorrectly established and approval given for the granting of a loan. The applicant in this case was also introduced to the officer concerned through the friend who had advised Mr. Jackson to contact this officer. Arising out of this officer’s handling of the application of Mr. Jackson and that of the other applicant referred to, the officer concerned was charged with certain offences under the Public Service Act and has now been dismissed from the service.
It was never the intention of the act that assistance should be granted to a person who was not entitled to it. In fact, regulation 21 specifically provides that where it is proved to the satisfaction of the director that at the date of the contract of sale or advance the purchaser or borrower was not an eligible person under the act, the director may exercise all or any of the powers conferred upon him by section 36 of the act to recover possession of a property.
There is a large number of eligible applicants seeking to purchase group homes in the Sydney metropolitan area. These homes are erected by the division specifically for sale to eligible persons. They are sold at cost which is considerably below their market value. It would not be equitable to allow Mr. Jackson, an ineligible person, to retain a group home and deny these applicants the right to purchase homes to which they are entitled. Accordingly, and having regard to the circumstances in which Mr. Jackson was improperly granted a war service home, action has been taken to require him to vacate the property.
It has been suggested that the fault lies with the division because it allowed Mr. Jackson to go ahead in the mistaken belief that he was eligible to occupy the home. Having regard to the history of this matter and particularly the way in which Mr. Jackson went about lodging his application, the Minister for National Development (Senator Spooner) who is in charge of the War Service Homes Division, cannot accept this. Indeed, the evidence suggests that Mr. Jackson was well aware at all times that he was not eligible for war service homes benefits.
That was the explanation given by the Minister for National Development. Apparently it has not been accepted by the honorable member for Mitchell. I appeal to the honorable member, if he has any sense of the fitness of things, to direct his energy towards alleviating these most unfortunate circumstances and rendering some service or benefit to this unfortunate man. Nothing is to be gained by heaping calumny on the Minister in charge of the War Service Homes Division, who is bound by the strict terms of the act. lt is not within his power or the power of the Director of War Service Homes to exceed the limits of the act.
– I want to direct the attention of the House to the very important news item broadcast over the national stations this morning that yesterday four Liberal Party lady senators waited upon the Prime Minister (Mr. Menzies) to plead the case for equal pay for equal work by the sexes. It sounded to me as though the consciences of members of the Liberal Party were pricking them. It sounded to me as though these women, who have been enjoying the privilege of equal pay for equal work have been very conscience-smitten as Liberals and supporters of the Government because they know what is going on in the Public Service which is controlled by the Government.
I can understand this because, on Monday afternoon, a very prominent advertisement appeared in a section of the Sydney press calling for a senior librarian for appointment to a permanent position in the Department of Supply. The advertisement contained the vicious line which such advertisements usually contain that the female rate for the position would be £188 less than the male rate.- This was so although a female appointee would need to have the same qualifications as a male appointee and would have to satisfy all the requirements of the position. It is no wonder that Liberal Party senators of the female sex, after reading that advertisement on Monday afternoon, pleaded with the Prime Minister to do justice inside the Public Service.
Mr. Speaker, this is an indication of the general feeling that is growing in this country. For this Government to pay lip service at the International Labour Organization to the principle of equal pay for equal work by the sexes and then be a party to advertising of this character is anomalous. In the “Sydney Morning Herald” are advertisements of vacancies in every section of the Public Service, including the Commonwealth Scientific - and Industrial Research Organization, in respect of which, although the qualifications and requirements are the same, female appointees are to be paid £188 a year less than male appointees.
If we pick up a telephone in Sydney on a Sunday afternoon to make an interstate call, we find that a female monitor is in charge of the whole organization of the big trunk exchange in Sydney. She has total charge of that monitorial work, but she is paid £180 a year less than her male counterpart, who will sign on under the supervision of a traffic officer on Monday morning. Right through the Public Service, this Government is exploiting cheap labour by this means. When we analyse the figures for 1960-61, we find that whereas in private employment figures for male appointments and female appointments ran somewhat parallel, in the Public Service more female labour than male labour was engaged. I want these figures to be firmly in the minds of honorable members. The increase in male staff in that year was approximately 4.5 per cent. The increase in female staff in the same year was 15 per cent. Application for those appointments was made in response to advertisements of this type. With automation moving into the field of social services and other activities, this Government is employing female officers at £188 a year less than a job is worth. In the Repatriation Department, or any other department, we see men and women lined up side by side on the same floor, under one supervisor and attending to the same class of work, but with a difference of £188 a year in salary as between male and female.
When we find lady senators, members of the Liberal Party, for one reason or another - for political propaganda or because their consciences have smitten them - making an approach of this kind, the time has arrived when all male members of the Liberal Party should ask the Prime Minister the same question, or rise in their places and deny that they are loyal to the policy put on behalf of this Government to the
International Labour Organization. This year we see the movement of automation. We see it in the operation of the Tress equipment by the Postmaster-General’s Department. In the Commonwealth Bank, machines operated by female employees are taking the place of male employees. In America, where automation is really on top, the distribution of labour in 1900 was 60 per cent, male and 40 per cent, female. The figures in relation to white collar workers were about the same. White collar work under the system of automation lends itself to the employment of female labour and in America to-day in white collar work we see female workers taking the place of male workers and even outnumbering those who don blue shirts and overalls.
We see a similar design in this Government’s activities right across the country. According to the item broadcast by the Australian Broadcasting Commission this morning, the lady senators left the Prime Minister with food for thought, but he is a party to advertisements of this kind. He is doing a tremendous disservice to the nation at a time when the national Government, above all, should be setting an example to the whole community, including private enterprise. The Commonwealth Government is prepared, in a period of automation, to use female workers instead of male workers, as machines take “the place of men. It is prepared to advertise positions for women to operate machines at salaries £188 a year less than those payable to males, although they are required to have the same qualifications. The Government is setting a standard that is not in keeping with modern requirements of decency in employment in this or any other country.
– I congratulate the honorable member for Blaxland (Mr. E. James Harrison). At last the Australian Labour Party is becoming educated to something I said 28 years ago. The honorable member for Lalor (Mr. Pollard) nods his head. He knows the position and other honorable members opposite should ask him. Any one who wants to do so may look at articles written by me that appeared in the Melbourne “ Herald “ in 1934 under the heading “Equal Pay for Equal Work”.
On that occasion, I was torn to pieces in subsequent correspondence by the Leader of the Victorian Branch of the Labour Party, Mr. T. Tunnecliffe, and also by the Leader of the Victorian Trades Hall. Any one who does not believe this may turn up the newspapers and read about it. As the honorable member for Blaxland and others have become educated in that respect, perhaps I shall be able to educate them in respect of Australia’s defence and foreign policy.
I rose to speak on an entirely different matter. I understand that the Opposition will raise a matter of urgency to-morrow in order to avoid discussion of the motion that stands in my name in respect of foreign policy and the defence of South-East Asia. I am not dismayed, amused, nor surprised, because as recently as 15th March, in the debate on my previous motion in relation to defence, members of the Opposition scuttled like rabbits for their burrows in order to avoid a discussion of something on which they had no policy and which, for that reason apparently, seriously embarrassed them. The fact that they wish to avoid discussion of South-East Asia, on my motion, is perhaps one of the highest compliments that I have ever been paid by my political opponents. They know that I have been in South-East Asia recently and they are apparently frightened of what I may say. They know that a large section of the public is becoming increasingly interested in what is happening in that area and in New Guinea, and they are so divided among themselves that they have not any policy and want to avoid being in a very embarrassing position. I may be right or I may be wrong. Events will determine that one way or the other, but unfortunately in the past - and it is not good for the ego - I have not been wrong on what was going to happen in Asia. I was not wrong in 1935. After a year, when I found very few people wanted to hear about it, I funked it, and I have no intention of being a coward again. I believe what I have said and I will go on saying it. This Parliament in the 1930’s either did not know or did not understand the position - at great cost subsequently to Australia.
What I think as an individual does not matter. We should not be afraid to discuss whether our foreign policy is right or wrong and whether our defence policy is adequate for the future security of Australia. Anzac Day falls in a week or so. I say to honorable members: When you go home, tell the people of Australia, “For your to-morrow, we gave our to-day”. Do honorable members not care about the to-morrow of their children or their children’s children? I say to them: “ If you do care, then for the love of them please go to South-East Asia and talk to the people there. Or send your representatives there to find out what is happening. Talk to the educated Papuans and the people of West New Guinea and find out for yourselves about the situation there. Talk to Asians and American soldiers who are defending us to-day.” Apparently we expect them to go on defending us while we are not carrying our share of responsibility. Are we quite happy to gamble as we did in the 1930’s when we lost?
If so, I trust that the Government will take over my motion or, on its own initiative, present a statement to this House so that it will have an opportunity to discuss this matter before we go into recess. I hope that the Government will give some lead to the people on our foreign policy in this region and on the adequacy of our defences.
The Opposition has been quoting me freely from articles that I have written recently. I should like to quote from an article that was published last Friday in which I stated -
Australia is unfortunate to-day to have an Opposition that does not seem to know or care what is happening in South-East Asia. 1 want to amend that statement to cut out the words “ seem to “. We have an Opposition that does not want to know and does not care what is happening in SouthEast Asia.
Motion (by Mr. Fairhall) put -
That the question be now put.
The House divided. (Mr. Speaker - Hon. Sir John McLeay.) Ayes .. .. ..59
Majority . . 2
Question so resolved in the affirmative. Original question resolved in the affirmative.
House adjourned at 12.8 a.m. (Thursday).
The following answers to questions were circulated: -
s asked the Minister representing the Minister for Civil Aviation, upon notice -
Australia by (a) Qantas and (b) each of the other international airlines plying to Australia?
– The Minister for Civil Aviation has supplied the following information: -
In the same period the other international airlines at present operating regular services to Australia transported assisted migrants as follows: -
To London via India (the Kangaroo Route) - Five return Boeing services per week and one return Comet service per week.
To London via San Francisco and New York - Three return Boeing services per week.
To the United States terminating at San Francisco - Three return Boeing services per week.
To Vancouver (Canada) via San Francisco - One return Boeing service per week.
Grouped together these represent seven services a week along the Southern Cross route to North America. To Japan via Manila and Hong Kong - Three return Boeing services per week.
To Noumea (New Caledonia) - One return
Boeing service per week.
To the Philippines via New Guinea - One return Super Constellation service per week. To New Zealand - Thirteen return Electra services per week.
To South Africa via Cocos (the Wallaby Route) - One return Super Constellation service per fortnight. In addition to the above services, Qantas also maintains air services between Lae and Hollandia, in Netherlands New Guinea, and between Lae and Honiara, in the British Solomons. These services are at present operated by Trans-Australia Airlines on behalf of Qantas.
d asked the Minister representing the Acting Minister for Trade, upon notice -
– The Acting Minister for Trade has supplied the following answers to the honorable member’s questions: -
d asked the Minister representing the Minister for Customs and Excise, upon notice -
– The Minister for Customs and Excise has furnished the following answer to the honorable member’s question: -
Since September, 1960, when the question was last considered, the Department of Customs and Excise has received only one further complaint of an alleged restrictive trade practice. The complaint, concerning the sale of Australian wine bottled by retailers, is at present being investigated.
n asked the Minister representing the Acting Minister for Trade, upon notice -
– The Acting Minister for Trade has supplied the following answers to the honorable member’s questions: -
t.- On 14th March, the honorable member for Ballaarat (Mr. Erwin) asked me without notice whether the Government would consider providing in the Budget for small personal loans to be made in certain circumstances to thirdyear university students. In my interim reply, I said that I would examine the proposal further.
In his question, the honorable member suggested that such loans might be made through one of the Commonwealth’s banking institutions. This would not be practicable as the Commonwealth does not make money available to banks for lending to particular persons.
The Commonwealth does, however, itself already provide generous financial assistance to university students. Under the Commonwealth Scholarship Scheme, there is provision for payment of tuition and other compulsory fees and, subject to a means test, of a living allowance to eligible students. About 4,100 new scholarships are awarded annually under this scheme and some 13,000 university students are currently benefiting from it. The estimated expenditure on the scheme in 1961-62 will be just under £3,000,000.
n asked the Minister for Primary Industry, upon notice -
– The answers to the honorable member’s questions are as follows: -
ser asked the Minister for the Interior, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Minister for Territories, upon notice -
What steps have been taken by the Government to eliminate all instances of racial discrimination in the Territory of Papua and New Guinea?
– The answer to the honorable member’s question is as follows: -
All laws of the Territory containing provisions which differentiate by race are being examined under a policy direction that unless it can be shown that special provisions are needed to guard the well-being of the people, in defined circumstances, or to respect their own customs, the laws of the Territory shall apply equally to all inhabitants of the Territory.
As a result of this work thirteen ordinances containing discriminatory provisions were repealed or were amended to remove objectionable provisions at the March, 1962, meeting of the Legislative Council for the Territory. Several bills are in hand for introduction at the meeting of the council in May or June next.
Any other forms of racial discrimination that may occur arise from the conduct of individuals or businesses. The Administration is continually watching for such instances. If an offence against the laws of the Territory is involved, action is taken against the offender. In other cases, the Administrator endeavours by quiet influence to have the practice discontinued.
t asked the Minister representing the Minister for Health, upon notice -
– The Minister for Health has furnished the following reply: -
t asked the Minister representing the Minister for Health, upon notice -
– The Minister for Health has furnished the following reply: -
t asked the Minister representing the Minister for Health, upon notice -
– The Minister for Health has furnished the following reply: - 1 and 2. A chemist is not permitted to supply any drug as a pharmaceutical benefit unless he is presented with a prescription, written by a medical practitioner, for the supply of the drug to the patient. A medical practitioner may write a prescription for the supply of butazolidin as a pharmaceutical benefit if he considers that this drug would be appropriate for use in the treatment of the condition from which his patient is suffering. Chloromycetin may be prescribed as a pharmaceutical benefit only for the treatment of certain diseases specified in the National Health (Pharmaceutical Benefits) Regulations, these restrictions being in accordance with recommendations by the Pharmaceutical Benefits Advisory Committee. It is proposed that as from 1st May next largactil may be prescribed as a pharmaceutical benefit, only in approved hospitals, for patients discharged from hospital but still under psychiatric treatment and for pensioners - these restrictions being those recommended by the Pharmaceutical Benefits Advisory Committee.
t asked the Minister representing the Minister for Health, upon notice -
– The Minister for Health has furnished the following reply: - 1 and 2. No doctor is forced to prescribe any drug other than the one which in his judgment is the most appropriate in the treatment of the condition from which his patient is suffering.
b asked the Minister for Social Services, upon notice -
Will he give consideration to increasing the civilian widows’ pension and easing the means test?
– The answer to the honorable member’s question is as follows: -
Any question of increases in pension rates and liberalizations in the means test will be considered when social services are reviewed in connexion with the preparation of the Budget later in the year.
n asked the Minister for Social Services, upon notice -
– The answers to the honorable member’s questions are as follows: -
s asked the Minister for Social Services, upon notice -
– The answers to the honorable member’s questions are as follows: -
b asked the Minister for Social Social Services, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Minister for Social Services, upon notice -
– The answers to the honorable member’s questions are as follows: -
Reciprocal Agreement on Social Security.
t asked the Minister for Social Services, upon notice: -
– The answers to the honorable member’s questions are as follows: -
Cite as: Australia, House of Representatives, Debates, 11 April 1962, viewed 22 October 2017, <http://historichansard.net/hofreps/1962/19620411_reps_24_hor35/>.