House of Representatives
2 May 1962

24th Parliament · 1st Session

  1. House of Representatives
  2. 24th Parliament
  3. 1962

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

page 1817

QUESTION

BLOWERING DAM

Mr FULLER:
HUME, NEW SOUTH WALES

– I ask the Minister representing the Minister for National Development: What are the facts concerning the delay in the construction of the Blowering dam? Why has the Minister for National Development blamed the New South Wales Government for the loss of 600,000 acre-feet of water for irrigation and the dislocation of the Tumut No. 2 power station scheme? Is it a fact that, because of prior financial commitments for urgent governmental works in New South Wales, and the credit squeeze, the New South Wales Government had no funds with which to commence the construction of the Blowering dam in 1961?

Mr SPEAKER:

– Order! The honorable member’s question is becoming far too long. I ask him to come to the point of it.

Mr FULLER:

– Was the Commonwealth’s decision to delay financial assistance for this project purely a political one, as an influx of workers and Labour voters into the area was expected to cause the loss of the Hume seat by the Government?

Mr BURY:
Minister Assisting the Treasurer · WENTWORTH, NEW SOUTH WALES · LP

– The New South Wales public works programme would not be influenced by the credit squeeze or anything akin to it. The fact is that the New South Wales Government has received through the Australian Loan Council and through other Commonwealth channels increasing amounts each year for public works. I believe that the beginning and the completion of various public works in New South Wales have been adjusted to some degree according to the electoral pattern prevailing from time to time. I shall refer the details of the honorable member’s question to my colleague in another place and shall see that the honorable member receives a suitable reply.

page 1817

QUESTION

TAXATION

Mr KELLY:
WAKEFIELD, SOUTH AUSTRALIA

– My question is directed to the Treasurer. In view of the serious nature of the allegation made yesterday by the honorable member for Scullin, I ask whether the honorable member has availed himself of the opportunity to accede to the Treasurer’s request to produce information in support of his statement.

Mr HAROLD HOLT:
Treasurer · HIGGINS, VICTORIA · LP

– This morning, I caused to be delivered to the honorable member for Scullin a letter in which I asked whether he would make available to me any information which he had bearing on the substance of the question which he asked yesterday. I pointed out that in a matter of this kind, which could involve the reputation and integrity of the taxation administration and of myself as Treasurer, no delay could be allowed to occur before the matter was cleared up. Later in the morning I received a reply from the honorable member for Scullin, stating that he would be seeking leave at the end of question time to make a statement on the matter, and asking me to facilitate the granting of such leave. I have informed the Deputy Leader of the Opposition that the granting of leave will not be opposed by us.

page 1817

QUESTION

IMMIGRATION

Mr DALY:
GRAYNDLER, NEW SOUTH WALES

– I direct a question to the Minister for Immigration. In view of the decision of the Government, announced yesterday, in the cases of certain Portuguese and Malayans, will the Minister say why his tender mercies did not extend to the Chinese, Willie Wong, who was recently deported to continental China? Will the Minister state the reason for the deportation of Willie Wong? Was the deportation due to a mistake or to carelessness on the part of the Department of Immigration or is it in accordance with Government policy to deport to continental China? Is it a fact that several other Chinese await deportation to continental China? Is it to be taken for granted, in view of the treatment given to Willie Wong, that Chinese and other persons from countries behind the iron curtain will in future be deported to continental China or to those other countries in accordance with Government policy?

Mr DOWNER:
Minister for Immigration · ANGAS, SOUTH AUSTRALIA · LP

– The honorable member has asked a whole catalogue of questions. Some of them relate to policy and should therefore, I think, be placed on, the notice-paper. I will say this, however: The honorable member’s own party, when it was in office, acted according to the same principles that have been followed by this Government. The honorable member should realize, as I am sure the great majority of honorable members in this House realize, that for a long time attempts have been made by numbers of Chinese to enter this country illegally. Although the Chinese are an ancient race, with many fine qualities, they are past masters at the art of evasion and of avoiding rules relating to immigration laid down not only by this country but also by other countries. I refute entirely the suggestion in the honorable member’s question that Wong was deported because of a mistake, or that the policy was wrong. He came here as an illegal stowaway; he could not satisfy my officers as to his bona fides, and we did not believe his story. I feel that the action that my officers took, and the action that I took in signing the deportation order, were entirely proper. I am quite sure, Mr. Speaker, that the honorable member’s own leader would have taken exactly the same sort of action when he was charged with the responsibilities that I now bear. If this Parliament declares itself, in principle, to be in favour of illegal Chinese immigration, that will be one of the biggest reversals of Australian immigration policy that one would ever fear to contemplate. Really, Sir, I do not think my honorable friend from Grayndler is so stupid as to advocate such a change of policy.

page 1818

QUESTION

INTERNATIONAL TELEVISION FEDERATION

Mr JESS:
LA TROBE, VICTORIA

– Can the Postmaster-General tell the House the reason that led to the welcome decision to allow the Australian Broadcasting Commission to remain in Intertel?

Mr DAVIDSON:
Postmaster-General · DAWSON, QUEENSLAND · CP

– The question of membership of Intertel by the Australian Broadcasting Commission has been under discussion for a considerable time. I point out that at no time was there any requirement by the Government that the Australian Broadcasting Commission should relinquish its membership of Intertel.

Mr Whitlam:

– Then the - report was wrong? ;

Mr DAVIDSON:

– Any report to the contrary was wrong. As a matter of fact, the Government has always applauded membership of Intertel by the Australian Broadcasting Commission, because of the possibilities that such membership provides for extending the scope of the commission and for developing our capacity for programme production in directions in which Intertel could be helpful. It is true, however, that because of the extension of activities into this field certain questions arose of a wider nature, and that for some time discussions have proceeded as to the provisions which should govern that extension into the wider field. As a result of certain discussions complete agreement has been reached as to those provisions, and consequently the Government has been very pleased indeed to approve of the continuance - I repeat, continuance - of A.B.C. membership of Intertel.

page 1818

QUESTION

PENSIONS

Mr REYNOLDS:
BARTON, NEW SOUTH WALES

– Is the Minister for Social Services aware that officers of his department, apparently lacking a clear direction from him, are unable to give a definite ruling regarding the manner in which pensioners may earn their entitled income under the merged means test? Accordingly I ask a question based on the specific case of a pensioner couple entitled to earn the maximum amount of £7 a week, or £364 a year. Will the department allow such a couple to accept employment so as to earn at a greater rate than £7 per week - say £12 a week for 30 weeks - but so as not to earn in excess of the permissible income of £364 for the year? If such permission can be obtained, what period of twelve months would be taken into account? Would it be the current calendar year, the current financial year, the twelve-months period as from the date of the granting of the individuals’ pension, or the twelve-months period dating from the commencement of work?

Mr ROBERTON:
Minister for Social Services · RIVERINA, NEW SOUTH WALES · CP

– I have no doubt that for political purposes the honorable member for Barton has involved his own question. The question can be answered simply by my saying that there has been no change in the policy with regard to the application of the permissible income means test. It is possible for a single person to earn up to £182 per annum without prejudice to the pension he receives. That policy is consistent with the practices that have been in operation ever since the permissible income reached that figure, nor can I see any indication that it will be changed.

page 1819

QUESTION

WATER RESEARCH

Mr ENGLAND:
CALARE, NEW SOUTH WALES

– By way of preface to a question which I direct to the Prime Minister I point out that the Water Research Foundation of Australia expects this year to have a minimum of £24,000 available to contribute to water research at Australian universities. As industry and commerce are gradually increasing their financial support to the Water Research Foundation of Australia is the Commonwealth Government considering joining the governments of New South Wales, Victoria, Western Australia and Queensland in contributing a grant to assist the foundation?

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

– The honorable member will recall that I indicated before the end of last year that we had in mind asking the States to agree with us to set up a water resources council. Since then we have pursued that matter. I have so far had favorable replies from, I think, most of the States, and I do not doubt that I will have finally favorable replies from all of them. I think that until that water resources council has been established and we have been able to have discussions with the States in that form it would be premature to attempt to decide the particular question that the honorable member has in mind. I received a deputation about it and I am not forgetting that that request has been made and ought to be considered

page 1819

QUESTION

NUCLEAR WEAPONS

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

– Did the Minister for External Affairs, in replying to a letter from U Thant, Acting Secretary-General of the United Nations, regarding the proposal to form what has been described as a “ non-nuclear club “, point out that the Commonwealth Government, on whose behalf he wrote, comprised a coalition of the Liberal and Country parties representing less than 41 per cent, of the Australian electorate? Does the Minister agree that decisions of such importance, which could involve our very survival, should in a democracy be made by a majority vote of the people? If so, will he immediately recommend to the Government the holding of a referendum at the earliest practicable date to ascertain the Australian people’s views on the testing and stockpiling of nuclear armaments in this country?

Sir GARFIELD BARWICK:
Attorney-General · PARRAMATTA, NEW SOUTH WALES · LP

– I did not know the honorable member was dissatisfied with our form of government. Under our form of government the democratic process works through the ballot-box and the government of the day takes the responsibility of deciding matters for the community. If the honorable member feels that he can support in this country a suggestion for a radical change in our constitutional processes, then I wish him good luck.

page 1819

QUESTION

REPATRIATION

Mr HAWORTH:
ISAACS, VICTORIA

– I address a question to the Minister for Repatriation. It has relation to the Commonwealth artificial limb centres. Is it true that his department is opposed to the appointment of apprentices to this important industry? What provision is his department making to train, craftsmen to carry out the high skills needed for the making and repairing of artificial limbs, so that these centres will continue to operate at a high state of efficiency?

Mr SWARTZ:
Minister for Repatriation · DARLING DOWNS, QUEENSLAND · LP

– It is not correct to say that my department is opposed to the principle of apprenticeship as far as its artificial limb and appliance centres are concerned. One of the problems in the past has been the small number of employees in each State where the centres are operating. But the custom so far has been that fully qualified tradesmen - carpenters, fitters, turners and so on - have been recruited and trained at the various centres in the various aspects of limb and appliance making. At the same time some junior employees are trained in all aspects of - limb and appliance manufacturing until they are brought up to the necessary standard, so that when they become seniors they are qualified to carry on with the work. However, the proposal made by the honorable member will be considered. I will look at it to see whether an apprenticeship scheme can be introduced, at least in the larger centres where it might perhaps be warranted due to the greater number of employees. I will examine the proposal before the commencement of the next financial year.

page 1820

QUESTION

SUBSIDIES

Mr UREN:
REID, NEW SOUTH WALES

– My question is addressed to the Treasurer. Is he aware that in New Zealand the consumer may purchase butter for 2s. per lb., milk for 4id. a pint and bread for 7id. a 2-lb. loaf? Is he also aware that the New Zealand Government pays a consumer subsidy on these goods? Will this Government introduce a consumer subsidy on similar goods in Australia? Would not such a subsidy greatly increase consumption of those goods in Australia and thereby offset losses which will result from the establishment of the European Economic Community?

Mr HAROLD HOLT:
LP

– I do not propose to avail myself of what would appear to be an opportunity to enter into an extensive debate on dairy policy in this country as compared with that in New Zealand. As the honorable gentleman has addressed his question to me I take it he is virtually inviting some comparison between economic conditions in Australia and those in New Zealand. I know that New Zealand enjoys a very high standard of living but, looking at the respective circumstances of the two countries, I would much rather be Treasurer of Australia over the next ten or twenty years than Treasurer of New Zealand.

page 1820

QUESTION

WOOL

Mr COUTTS:
GRIFFITH, QUEENSLAND

– I address a question to the Minister for Trade. I preface it by saying that he is no doubt aware that at the wool sales held on Monday last at Brisbane and Melbourne there was a fall in the price of wool. Is it a fact that, as has been suggested by reliable authorities, the fall in price is attributable to Japan reducing the volume of its purchases? Was the reduction in purchases dictated, as has been suggested, by the inability of Japan to dispose of its processed woollen goods at a price competitive with that of other countries engaged in the processing of wool? ls the fall in the price of wool additional evidence of the existence of pies or buying rings, the purpose of which is the further depression of prices? If the answers to these questions are in the affirmative, will the Minister say whether this ties in with the suggestion conveyed to the Australian people in his television interview last Sunday night that an effort is being made by overseas countries to depress the Australian standard of living by an attack on the economic stability of our principal export commodity, namely, wool?

Mr McEWEN:
Minister for Trade · MURRAY, VICTORIA · CP

– A fluctuation of 2i per cent. - I think that was the figure mentioned1 - in the price of wool sold by auction is, of course, quite normal in the experience of any one who follows the Australian wool auction system. I would not be so bold as to attribute any particular cause to a fluctuation of that size. I have no doubt that there is no particularly sinister explanation of the fluctuation. 1 have not said, in a television interview or elsewhere, that there is anything in the nature of a conspiracy by overseas countries to depress the price of Australian wool.

page 1820

QUESTION

PAPUA AND NEW GUINEA

Mr FALKINDER:
FRANKLIN, TASMANIA

– Is the Minister for Trade aware that there is an increasing trend for the European population of Papua and New Guinea to buy goods from overseas countries rather than from Australia? Does the Minister know that, to give a few examples, domestic equipment such as refrigerators comes from as far afield as Sweden and Norway, that butter comes from New Zealand and Coca Cola from the United States of America? Will the Minister cause his departmental officers, in conjunction with officers of the Department of Territories, to investigate the position with a view to promoting the greatest possible reciprocal trade between Papua and New Guinea and Australia?

Mr McEWEN:
CP

– I am aware that, on occasions, there are imported into Papua and New Guinea manufactured goods which Australia could supply, but which come from other countries. The explanation, of course, is that the people of that Territory and those who are responsible for their well-being elect to buy to the best advantage. This is not an uncommon phenomenon. Nevertheless, it is a cause of some concern to Australian manufacturers that a Territory in respect of which this country has a responsibility and in respect of which this Parliament votes very large sums of money should turn to sources of supply other than this country. This is a matter which I have discussed from time to time with the Minister for Territories. I have also suggested to Australian commercial interests that they take steps, in addition to those which the Government may consider necessary, to promote the sale of their goods in that area.

page 1821

QUESTION

WAGE STANDARDS

Mr McIVOR:
GELLIBRAND, VICTORIA

– I preface a question to the Minister for Supply by referring to a speech made by the Minister at the fifth national electrical convention at Katoomba on Monday, in which he said that high costs were pricing Australia out of world markets. Which section of the Australian community does the Minister chiefly blame for high internal costs? Do the Minister’s speech and a similar speech made recently by the Minister for Shipping and Transport represent a threat to the Australian trade union movement that it must be prepared to accept a low-wage policy and reduce living standards to meet this situation?

Mr FAIRHALL:
Minister for Supply · PATERSON, NEW SOUTH WALES · LP

– Any similarity between the speech made by the Minister for Shipping and Transport and the speech made by myself is completely coincidental. At the convention on Monday I set out to bring to the attention of the electrical industry and of industry generally the extent to which our secondary industries have become uncompetitive in world markets. This statement did not pose a threat to anybody. However, the Australian people - industrialists, management and workers - must recognize that we are moving into times in which we must either reduce our standard of living or become competitive. There is no reason why we should have to reduce our standard of living. I direct the attention of the honorable gentleman to the fact that our country had the doubtful honour of being third from the bottom of a long table, published by the International Labour Office, showing the hours of work in indus trial countries throughout the world. These are all matters that have to be considered, and it was to such matters that I directed the attention of the electrical industry on Monday. But I do suggest to the honorable member, and to other honorable members who may be interested, that we shall be spending a lot more time considering this kind of problem and its implications in the future than we have done in the past. If the honorable member had seen the full report of my speech he would have noted that I laid responsibility for correction of this situation squarely on labour, government and management.

page 1821

QUESTION

OVERSEAS INVESTMENTS IN AUSTRALIA

Mr IAN ALLAN:
GWYDIR, NEW SOUTH WALES

– I ask the Treasurer whether he is aware that although many overseas residents are anxious to invest in Australia some Australian commercial and industrial organizations do very little to encourage investment by overseas investors. Will the Treasurer use his good offices to gain the co-operation of Australian companies in such matters as payment of dividends into shareholders’ bank accounts, ensuring that overseas shareholders are notified in good time of new issues, and in generally facilitating those matters which are likely to encourage investment in Australia?

Mr HAROLD HOLT:
LP

– I am sure the honorable member recognizes the great value Australia has obtained over the years from the investment of capital from overseas in Australian ventures; but I should like to study the text of the question he has put to me. Frankly, I would see some difficulty in any active government intervention in the way that he proposes, because apart from anything else the circumstances of companies vary. Some companies seek to encourage greater overseas participation in their shareholdings, whilst other companies, for their own domestic policy reasons, prefer that this should not become extensive. However, I shall be glad to have a look at the details of the question put by the honorable member.

page 1821

QUESTION

IMPORTATION OF CAPITAL GOODS

Mr L R JOHNSON:
HUGHES, NEW SOUTH WALES

– I preface a question addressed to the Minister for Trade by saying that last Monday some important statements were made by Sir James Kirby, chairman of the Manufacturing Industries Advisory Council to the Federal Government. I ask the Minister: Is it a fact that, as suggested by Sir James Kirby, millions of pounds are being spent on the importation of capital goods which could be equally well supplied by Australian industries? Is it also a fact that Commonwealth Government departments are the worst offenders in this regard? Will the Minister investigate the claim by Sir James Kirby that Commonwealth departments show a preference for imported goods, which they obtain free of customs duty? If these allegations are substantiated, will the Minister encourage the Government to pursue a policy of giving preference to Australian goods?

Mr McEWEN:
CP

– I am sorry I have not seen any such statement attributed to Sir James Kirby, but I can assure the honorable member, and all who are interested, that the basis upon which manufactured goods come into this country is that established by the tariff schedule approved by this Parliament. That schedule establishes the competitive position between Australian manufactured items and those that are imported.

So far as the Government is concerned, let me say that when the Government calls for tenders, and even when it does not call for them, it compares the price of the Australian item with that of the imported item, and for purposes of comparison and calculation always adds to the imported item the rate of duty that would be payable if it were in fact a commercial importation.

Mr L R Johnson:

– Sir James Kirby says that does not work any more.

Mr McEWEN:

– I assure the honorable member that it does work, and it is the policy of this Government that it shall work. It is also the policy of this Government that where there is a marginal situation a preference shall be exercised in favour of the Australian item. The Prime Minister has reminded me of something which we both know to be a fact but which had slipped my memory. It is relevant to the question. It is this: The overwhelming proportion of goods bought by Commonwealth depart ments, which are available either from Australian manufacturers or from overseas sources, is procured from Australian manufacturers. An analysis of the situation shows that during the period of office of this Government the proportion of such goods bought by departments from Australian sources is considerably greater than was the proportion so bought when the Australian Labour Party was in office.

page 1822

QUESTION

UNEMPLOYMENT STATISTICS

Mr SNEDDEN:
BRUCE, VICTORIA

– My question is addressed to the Minister for Labour and National Service. I refer to the monthly survey of employment statistics issued by his department. This has been of great value to those persons and organizations concerned with the problems of employment and with the trends of manufacture and industry in Australia. Will the honorable gentleman instruct his department to extend the range and the detail of the statistics contained in the review so that it may be of even greater value?

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

– The department has in the usual monthly survey of employment continued to increase the range of the statistics. I think the honorable gentleman will know that last month, for the first time, statistics were provided relating to juniors and seniors registered for employment, and the statistics were divided between male and female employees. With the next monthly survey, we will be issuing a statement relating to the professional groups and the occupations by trades, showing the numbers unemployed and the job vacancies that exist. The statistics will be divided into seven sections relating to such matters as the metal trades, building and construction trades, rural industries, other skilled workers, and the manual and unskilled workers. They will also be divided between male and female employees.

I think these two groups of statistics will go a long way towards filling a gap which many people felt prevented them from making the estimates of forward prospects that they wanted to make. I am looking at other matters that have been referred to me from time to time, and if I think it is desirable to incorporate other statistics, I will have the greatest pleasure in doing so.

page 1823

QUESTION

SHIPPING FREIGHTS

Mr BRYANT:
WILLS, VICTORIA

– I address my question to the Minister for Shipping and Transport. In a way it is supplementary to the question asked earlier by the honorable member for Franklin of the Minister for Trade. Is the Minister for Shipping and Transport aware that freights between Australia and the Territory of Papua and New Guinea are so high that they are prejudicing the sale of Australian products on the New Guinea market? Is he aware that there is a strong feeling in the Territory that the local people are being exploited by the shipping companies trading to the Territory? I was told, for instance, that freight on cement from Belgium is lower than freight on cement from Australia. Will the Minister have the Australian National Line trade vigorously to Papua and New Guinea and so break the existing ring of shipowners?

Mr OPPERMAN:
Minister for Shipping and Transport · CORIO, VICTORIA · LP

– Shipping freights between Australia and New Guinea are a matter for adjustment by the shipping line concerned. We as a Government provide subsidies. If we did not, the freights would be far higher than they are. If the Australian National Line operated a service to New Guinea on Australian conditions, as it would be required to do, freights would be no lower than they are at present.

page 1823

QUESTION

EMPLOYMENT OF PHYSICALLY HANDICAPPED PERSONS

Mr FOX:
HENTY, VICTORIA

– I preface my question, which is addressed to the Minister for Supply, by directing attention to the very useful function that is being performed by sheltered workshops, and to the increasing importance of the part they are playing in the rehabilitation of physically handicapped and mentally retarded people. I ask the Minister whether he will consider the letting of suitable government contracts to these sheltered workshops?

Mr FAIRHALL:
LP

– I am sure there is general sympathy with and the widest possible support for the work that is being done by sheltered workshops in providing paid employment within the capacity of physically handicapped persons. Unfortunately, 1 cannot quickly bring to mind any contracts that could be let by my department which would be suitable for the somewhat limited capacity of the sheltered workshops. I should think that the work for which they are best suited is light sub-contracting work and so on. However, in response to the honorable member’s suggestion I will consult the contracts division of the department to see whether there is any work that we deal with which would be within the capacity of these workshops.

page 1823

QUESTION

WATERFRONT EMPLOYMENT

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES

– My question is directed to the Minister for Labour and National Service. Does the Minister remember that on 28th March last he made an admission that there were anomalies in the long service leave legislation applicable to waterside workers? Does the Minister remember stating also that he was looking at these anomalies? Will he say now at which anomalies he is still looking and upon what anomalies he has made any decisions? Finally, when will the Minister make recommendations to the Government, and when may the Parliament expect to receive amending legislation to correct anomalies that have been admitted to exist?

Mr McMAHON:
LP

– I did say to the House that certain alleged anomalies had been brought to my attention and that I or my department would consider the problems involved with the Australian Council of Trade Unions and the Waterside Workers Federation as soon as both sides of the case had been prepared and presented to us. Arrangements have been made to discuss the problems with the A.C.T.U. and the Waterside Workers Federation on 9th May. I hope, shortly after that, to be able to look through the recommendations and documents myself, then to prepare a submission for Cabinet and, finally, to come to this House with Cabinet’s approval.

page 1823

QUESTION

WATER CONSERVATION

Mr TURNBULL:
MALLEE, VICTORIA

– I direct a question to the Prime Minister. In answer to my recent question on the proposed Marraboor weir, the right honorable gentleman said that he thought it was a guinea to a gooseberry that the Marraboor weir would be mentioned at the conference on the Chowilla dam. That conference having now taken place, I ask: Is it a fact that the guinea was lost? If so, will the Prime Minister now confer with the

Minister for National Development with a view to convening a conference of appropriate Commonwealth and State authorities and others interested for the specific purpose of discussing the building of the important Marraboor weir?

Mr MENZIES:
LP

– I shall be very happy to convey my friend’s views to the Minister. As between him and me, I publicly admit that I owe him a guinea.

page 1824

QUESTION

PORTUGUESE SAILORS

Mr CALWELL:
MELBOURNE, VICTORIA

– I direct a question to the Minister for External Affairs. By whom and on what date was it first suggested that Portugal should agree to discharge the three naval ratings who were to have been deported but have now been allowed to remain in Australia? If he himself made the proposals, when did Portugal assent to them, and was the assent given with or without conditions?

Sir GARFIELD BARWICK:
LP

– The discussions between the Portuguese Government and this Government with respect to these seamen were carried on confidentially. I do not think it would be proper for me to answer the honorable member’s questions. I would have thought it sufficient that we all were very pleased with the result.

page 1824

QUESTION

WATERFRONT EMPLOYMENT

Mr JEFF BATE:
MACARTHUR, NEW SOUTH WALES

– In relation to the high cost of shipping and exporting goods, I ask the Minister for Labour and National Service whether the Sydney waterfront is now on strike. Is this an authorized strike? Was it approved by the Australian Council of Trade Unions?

Mr MCMAHON:
LP

– The honorable gentleman is correct. This morning the Sydney branch of the Waterside Workers Federation of Australia pulled out the members of that branch in an unauthorized strike. This is contrary to the law. The branch is allowed eight approved stopwork meetings per annum at which the members can discuss their differences with the employers. I can state definitely that this strike was not approved by the Australian Council of Trade Unions, and I am fairly certain that it would not have been approved by the federal organization of the Waterside Workers Federation. I deplore this strike, because, as the honorable member for Macarthur has indicated, it adds to the export costs of this country.

page 1824

QUESTION

COMMONWEALTH SCHOLARSHIPS

Mr GRIFFITHS:
SHORTLAND, NEW SOUTH WALES

– My question is addressed to the Treasurer. Is he aware that considerable delay in the payment of Commonwealth scholarship allowances to students continually occurs? Does he know that any delay at all in making these payments has a demoralizing effect on many of the recipients? Will the right honorable gentleman do something to ensure that the authority responsible for making the payments makes them promptly and on the date on which payment becomes due, or will he examine the question of whether an alternative method of payment to students is possible?

Mr HAROLD HOLT:
LP

– I am not conscious of any complaint of this sort having come directly to me. Now that the honorable gentleman has brought the matter before” me in this way, I shall certainly look into it immediately. I know of no reason for delay. If delay results from any cause which can be remedied, I shall do my best to see that it is remedied.

page 1824

QUESTION

REPATRIATION

Mr LESLIE:
MOORE, WESTERN AUSTRALIA

– I wish to ask the Minister for Repatriation a question which is supplementary to that asked earlier this afternoon by the honorable member for Isaacs in relation to the staffing of artificial limb factories. I ask whether the Minister is aware - and I think he is - of the fact that artificial limbs are at present made by workers and artificers who are themselves actually limbless or similarly disabled. This work is done by these people, as I am sure the Minister knows, because their disability gives them a particular knowledge of the requirements of those who need artificial limbs. In considering the intake of apprentices in this occupation, will the Minister bear in mind the desirability of engaging people who have this particular knowledge which so well equips them to meet the needs of those who require artificial limbs?

Mr SWARTZ:
LP

– It is a fact that a fair proportion of the persons employed in the centres throughout Australia where artificial limbs and appliances are made are limbless ex-servicemen. It is a fact, also, that the junior employees who are now being employed are not limbless ex-servicemen. As time goes on, the number of limbless exservicemen on the staffs of these centres will decrease. The point that the honorable member has raised will be considered when I examine this question of the employment of apprentices.

page 1825

QUESTION

MONOPOLIES AND RESTRICTIVE TRADE PRACTICES

Mr HAYDEN:
OXLEY, QUEENSLAND

– My question is directed to the Attorney-General. Does he consider that the growth of monopolies and the incidence of restrictive trade practices and of take-overs of local enterprises by those monopolies in this country urgently demand the introduction of legislation to control the activities of such monopolies? If so, will he say what action is proposed and when the Government will implement it?

Sir GARFIELD BARWICK:
LP

– I have been steadily answering this kind of question for some time. If the honorable gentleman has some information about harmful monopolies or practices of the kind mentioned, and will give me that information, I shall be delighted to receive it as soon as possible.

page 1825

QUESTION

CANBERRA HOUSING

Mr J R Fraser:
ALP

– I ask the Minister for the Interior: Is he yet in a position to say whether the maximum home-building or home-purchase loan made available in Canberra by the ‘Department of the Interior will be increased from the present level of £2,750 to £3,500 similarly to the recent increase in the maximum war service homes loan?

Mr FREETH:
Minister for the Interior · FORREST, WESTERN AUSTRALIA · LP

– No final decision has been taken in this matter. It is being considered at present.

page 1825

QUESTION

TAXATION

Mr PETERS:
Scullin

– by leave- Mr. Speaker, yesterday, I asked the Treasurer (Mr. Harold Holt) this question -

As it is reported that a member of one of the Government parties understated his income for taxation purposes and that his name was omitted by direction from the official list, recently pub lished by the Commissioner of Taxation, of those who understated their income or evaded their legitimate taxation, I ask: Was any such name omitted from the list? If so, was it omitted by direction and, if so, by whom was the direction given? Whose name, if any, was omitted?

The right honorable gentleman did not answer the question. He challenged me to make some specific accusation and to produce some evidence of the accuracy of the allegation. To-day, I received from the Treasurer a communication in which he stated -

As the matter stands, you have brought into question the integrity of the Commonwealth Taxation administration. Not only can the reference be drawn that I, as Commonwealth Treasurer, was in some way a party to an improper concealment but that the Commissioner of Taxation, whose independent status has always been zealously safeguarded and respected, is also directly involved.

Members of the public are entitled to assume that taxation administration is conducted honestly, impartially and strictly within the province of the law as prescribed by Parliament.

There must be no impairment of that confidence by delay in dealing with a serious charge levelled at that administration.

I agree with the right honorable gentleman: There must be no impairment of that confidence. There must be no impairment, by delay or in any other way, of confidence in the administration of the Taxation Branch. A very famous democrat once said that he was so sensitive of the honour of the parliamentary institution that he felt every allegation that was made against it, as it were, a physical wound. I do not go that far, but I do say that, as a member of this House, it is my bounden duty to protect the honour of this institution and the integrity of the Public Service. The only affirmation that was made in my question was prefaced by the words “ it is reported “.

Government Supporters. - Ah!

Mr PETERS:

– “ Ah!” say honorable gentlemen opposite. There is no honorable member on the Government side of tha House who does not know, and there are few members of the Public Service in various departments who do not know, that this allegation was being bandied from one end of Australia to the other. It was known not only in Melbourne, but also in Sydney. It was made in Sydney and in Brisbane.

Mr Killen:

– Why don’t you resign?

Mr PETERS:

– The honorable gentleman repeats the gutter statement that was made over the radio by Eric Baume, who asked why I do not resign.

I exercised my right, as a member of this Parliament, to ask a question. When I ask the question, of course, I put myself in the worse position. The Treasurer has unlimited time to reply. I have the right merely to ask a question.

I asked my question. If I had absolute evidence, what would I do? Would I ask a question? No. I would move that the House express want of confidence in the Government and in the Treasurer, and I would make every allegation and produce all the evidence. However, what I did was this: I said that a statement was being made - that it was being continuously made - by public servants and by others, and that the name of the individual was mentioned. I did not come in here and say, “ Is it true that so-and-so did not do this or did not do that? “ No! I came in seeking information so that the Treasurer might, if he felt so disposed, uphold the honour of this House and vindicate the integrity of the department which he administers. Instead of that, what does he do? He drags the institution down. He endeavours, by imputing improper motives to the questioner, to stifle the asking of questions. He endeavours to intimidate. But, in addition, the hirelings of the Government, such as Eric Baume and others, in their broadcasts over the air, make statements such as that which was repeated in this House by the honorable member for Moreton (Mr. Killen).

Let me assure every member of the Government that so long as I remain a member of this House I will ask any question that I consider to be desirable in the public interest. While I am a member of this House, if at any time I find any evidence of what I consider to be corruption, either within my own party or on the Government side of the House, I will not hesitate to attack such corruption. I know that this seems ridiculous to honorable members who to-day disgrace the treasury bench. They cannot conceive of anybody, in the interests of this country and our democratic institutions, fighting those who sit with him as well as those who have consistently stood against him.

Mr HAROLD HOLT:
HigginsTreasurer · LP

– by leave - In commencing his remarks the honorable member for Scullin (Mr. Peters) said that he had put a question to me yesterday which I had not answered. Sir, I answered the question which he put to me yesterday to the best of my ability, having regard to my lack of knowledge yesterday of the substance of the matters referred to in his question. If I may remind the House, I replied to the effect that this was the first time that any such information had reached me. I also said as much in the letter which I forwarded to the honorable member earlier to-day. In that letter I said -

I replied to the effect that this was the first time any such information had reached me and promised an immediate investigation if you could place before me any information which you believed to be responsibly based.

The honorable member for Scullin did not read exactly the precise text of my letter, a copy of which I have before me. I do not suggest that he deliberately misquoted it, but in one or two instances he used words which were not the same as those that were used in the letter. For example, he talked about “ the province of the law “, when the phrase used in the letter was “ the provisions of the law “. However, those are matters of detail. My letter continued -

I am sure you will recognize the need for an allegation of this kind to be dealt with urgently. As the matter stands, you have brought into question the integrity of the Commonwealth Taxation administration. Not only can the inference be drawn that I, as Commonwealth Treasurer, was in some way a party to an improper concealment but that the Commissioner of Taxation, whose independent status has always been zealously safeguarded and respected, is also directly involved.

Members of the public are entitled to assume that taxation administration is conducted honestly, impartially and strictly within the provisions of the law as prescribed by Parliament.

There must be no impairment of that confidence by delay in dealing with a serious charge levelled at that administration.

I shall appreciate it, therefore, if you will place in my hands - preferably before the meeting of the House this afternoon - any information which supports or relates to the allegation you have brought before the Parliament.

The honorable member appears to make something of the fact that he has not made an allegation, and that what he has done has been simply to say, “ It has been reported “. I leave it to the House to decide whether what the honorable member put by way of a series of questions yesterday did not either constitute an allegation or leave inferences to be drawn which reflect seriously on me, in my position as Treasurer, and on the administration by senior officers of the Taxation Branch. These are really very grave charges that have been made, and I have sought to have them dealt with at the earliest possible moment. It is clear either that the honorable member has nothing of substance to put before the Parliament or that, despite his protestations, he has withheld such substantial statements from the Parliament.

Mr Ward:

– Have you made any inquiries in the department?

Mr HAROLD HOLT:

– The honorable member for East Sydney asks me whether I have made any inquiries. If he wants to know whether I have made inquiries either of the Treasury or of the Commissioner of Taxation, the answer is that I have not.

Mr Ward:

– Why not?

Mr HAROLD HOLT:

– I have not done so by deliberate purpose, because I did not want to do so until I had a responsibly based allegation which I could put to the people concerned. I felt, Sir, that my proper course was not to make any official approach to any senior member of the administration unless I had something of substance that I could bring under his notice. The nearest the honorable member got to making an allegation of substance was to say that there are rumours bandied about in this Parliament, and bandied about around the Commonwealth and throughout the Public Service, involving some one. He has not named that some one, nor has he given an opportunity to any member of this Parliament who might be so named to deal with the matter himself. What he has done is to leave hanging over the Parliament a charge, in effect, that some member of the Parliament has been a party to this episode.

It is not difficult for people to smear members of this institution. We are all highly vulnerable to this kind of attack. We are in the searchlight of public examination at all times. It is bad enough when charges such as these are made irresponsibly and recklessly, and, usually, in a cowardly fashion, by some member of the public acting in a malicious way. I say, Sir, that it is to be utterly condemned when such recklessness, irresponsibility, and, I would say, cowardice, are to be found in a member of this House.

page 1827

GOLD-MINING INDUSTRY ASSISTANCE BILL 1962

Message recommending appropriation reported.

In committee (Consideration of GovernorGeneral’s message):

Motion (by Mr. Harold Holt) agreed to -

That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to extend by three years the period of operation of the Gold-Mining Industry Assistance Act 1954-1961, and for purposes connected therewith.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Mr. Harold Holt and Mr. Opperman do prepare and bring in a bill to carry out the foregoing resolution.

Bill presented by Mr. Harold Holt, and read a first time.

Second Reading

Mr HAROLD HOLT:
HigginsTreasurer · LP

– I move -

That the bill be now read a second time.

The purpose of this bill is to re-enact the provisions of the Gold-Mining Industry Assistance Act 1954-1961 for a further three years. That act provides for the payment of subsidy on the production of gold in Australia and the Territory of Papua and New Guinea up to 30th June this year. The effect of the bill is to extend the operation of the subsidy scheme to cover gold produced in the years 1962-63, 1963-64, and 1964-65.

The gold subsidy scheme was introduced in 1954 in order to provide assistance to the gold-mining industry in the light of increases in costs and a fixed official world price for gold and so to help to maintain communities in isolated areas which are largely dependent upon the continuing operation of gold-mines. The subsidy scheme was originally introduced for a period of two years and it has successively been extended since that time. The maximum rates of subsidy were increased in 1957 and again in 1959 following rises in costs in the industry. At present subsidy rates stand at a maximum of £3 5s. per fine ounce in respect of large gold producers, and small gold producers are eligible for payment of a flat-rate subsidy of up to £2 8s. per ounce.

For the convenience of honorable members, I shall briefly outline the main provisions of the scheme. A gold producer is not eligible for subsidy unless the value of his gold production in a financial year is more than 50 per cent, of the total value of his mining output in that year. For subsidy purposes producers are divided into two classes - small and large producers. A small producer is one whose output is not more than 500 oz. of fine gold in a subsidy year, but a producer whose output falls between 500 and 1,075 oz. in a year may elect, under an amendment which was made to the act in 1961, to be classified as a small producer. A small producer is eligible, irrespective of his costs of production, for subsidy at the rate of £2 8s. per oz. subject to a sliding scale reduction of the rate of subsidy in the case of producers of between 500 and 1,075 oz. who elect to be regarded as small producers. A large producer is eligible for subsidy at a rate per oz. equal to threequarters of the amount by which his average cost of production in a subsidy year exceeds £13 10s. per oz., subject to a maximum rate of subsidy of £3 5s. per oz. and provided that his profits after subsidy do not exceed 10 per cent, of the capital employed by him in the production and sale of gold. If either small or large producers receive more than £15 12s. 6d. per oz. - the Reserve Bank’s official buying price - for the sale of their gold, for example as a result of sales on overseas premium markets through the Gold Producers Association, their subsidy entitlement is reduced accordingly.

Since the inception of the scheme subsidy payments of over £4,000,000 have been made to the industry. This assistance is, of course, in addition to the complete exemption from income taxation enjoyed by the industry.

During the period of the subsidy scheme, total gold production in Australia and its territories has been maintained at a relatively stable level of a little over 1,000,000 fine oz. per year. About 25 per cent, to 30 per cent, of this production has qualified for subsidy assistance, and this proportion represents, in effect, the production of mines which might not have been able to carry on without the assistance provided under the scheme. It is clear, therefore, that the subsidy scheme has made a major contribution to the stability of the gold-mining industry.

As honorable members will appreciate, the best form of assistance for the industry would be a rise in the world price of gold. Australia, in common with other major gold-producing nations, has consistently supported moves for a rise in the official world price of gold, but our efforts to this end have not been successful to date. There has been no increase in the official dollar price of gold since before World War II., and the official Australian price of gold has necessarily remained virtually unchanged since the devaluation of sterling in terms of the dollar in 1949. With the rise in cost levels this has had an obviously adverse effect on the Australian industry. Consequently, we shall continue to strive for an increase in the official world price at every available opportunity.

I wish to state in conclusion that the extension of the operation of the existing subsidy provisions without change does not necessarily represent the Government’s final position in the matter of assistance to the gold-mining industry. A number of proposals for amendment of the provisions of the act have been put before the Government, and the Prime Minister (Mr. Menzies) and I recently had discussions with a deputation representative of the Chambers of Mines of Western Australia, Victoria, Queensland and the Northern Territory. Consideration of the proposals put forward for amendment of the act could not be completed in the limited time available prior to the close of the present sittings of the Parliament. This consideration is still proceeding and the Government hopes to be in a position to indicate its decision by the time the Budget for 1962-63 is introduced. In the meantime it is necessary to extend the operation of the existing act for a further period beyond 30th June next, and with this object I commend the bill to the House.

Debate (on motion by Mr. Beazley) adjourned.

page 1829

SUGAR AGREEMENT BILL 1962

Second Reading

Debate resumed from 10th April (vide page 1505), on motion by Mr. Adermann -

That the bill be now read a second time.

Mr POLLARD:
Lalor

.- This measure concerns that all-important Australian tropical industry, the sugar industry, and relates to the renewal of the agreement between the Commonwealth Government and the Queensland Government. After an inquiry by a competent authority appointed by it, the Government has decided to renew the agreement on similar lines to those of the agreement which has operated over the past few years. The Opposition offers no opposition to that proposal. As a matter of fact, from the inception of the legislation controlling sugar prices in Australia and co-ordinating the marketing of Australian sugar in the respective States and abroad, the Australian Labour Party has always played a preeminent part in these arrangements. Complementary legislation inaugurating the first sugar agreement between the Commonwealth Government and the Government of Queensland was initiated in the Commonwealth Parliament by a Labour government and in the Queensland Parliament by a Labour government. It is to the eternal credit of both those governments that the end result of that action has been a highly efficient sugar industry. It is one of the most efficient sugar industries in the world.

It is true that over a number of years the price of sugar in Australia was substantially higher than the price obtaining on the outside markets of the world. That brought forth a good deal of murmuring and complaint in the main consumer States of Australia where no sugar was produced, because it was argued that the financial support being given to the sugar industry came, in reality, from the pockets of the workers of Australia. I have pointed out previously, in this Parliament, that, while it is true that for a considerable period of years the Australian sugar consumer paid for sugar grown in Australia a substantially higher price than that for which sugar could be obtained from outside sugargrowing countries, the establishment of the sugar industry in Queensland has been an important factor in the development of that State.

Sugar growing is a great tropical industry and a great employment-giving industry. Although the southern sugar consumer has made some sacrifice and has made a substantial contribution to price security in the industry, on the other hand the development of the industry in Queensland, the employment it has given, the manner in which it has raised the standard of living of the people of Queensland, and the establishment of dependent and ancillary industries, have meant that the southern States of Australia have been great suppliers of agricultural machinery, sugar mill machinery and all sorts of secondary products that have been required in Queensland. I suppose one of the greatest features of the establishment of the industry has been that, despite the forecasts of the early opponents of the industry in Australia, it has been, since the elimination of the kanaka labour - slave labour almost - carried on efficiently by the Australian people. It is unfortunate that, notwithstanding the International Sugar Agreement, which for a time gave a very great measure of security to the sugar industry in the sale of its surplus production, the industry throughout the world is in a rather unstable position at present. It is unfortunately true that there is a potential threat to the sugar industry of Australia in Great Britain’s possible entry to the Common Market.

In all these circumstances the Australian Labour Party and the Opposition in this Parliament have no hesitation whatsoever in according support to this measure. It is true that the Government had an inquiry into the industry by a competent authority, as I have mentioned, and that that authority recommended a reduction of one halfpenny a pound in the price of sugar to Australian consumers. But it is also true that, taking into consideration the threats facing the industry, it is reasonable to postpone the proposed reduction, at least for the time being. I will leave it at that, Mr. Speaker, and trust that as the result of the reenactment of this agreement on lines similar to those of the previous agreement, the sugar industry will be able to weather the storms which threaten in the international sphere and that it will continue to prosper, increase its efficiency and provide labour conditions of a standard equal to, or better than, any others in the world, although, indeed conditions in our sugar industry could still stand substantial improvement. On behalf of the Opposition, I support the bill.

Mr FALKINDER:
Franklin

.- Mr. Speaker, the honorable member for Lalor (Mr. Pollard) was commendably brief and so shall I be, because I have spoken on the sugar agreement on a number of occasions in this Parliament. I do not feel that there is any need for me to go over the history and all the facets of this agreement as I have on many previous occasions. Instead, I will just say, in a brief sketch, that the agreement did commence in 1915 and that in 1923 sugar was at £30 a ton. At that time, rebates were provided for the benefit of the fruit industry and those rebates went to the canners of fruit. In 1931, as the result of a committee of inquiry, the Fruit Industry Sugar Concession Committee was formed and since then has had the main responsibility for operating both the domestic rebate and the export rebate. The first contribution of the Fruit Industry Sugar Concession Committee was £315,000, but in 1933 it was reduced to £216,000. It remained at that level until 1951, when the contribution was suspended. Later on the contribution was reintroduced. My only point of contention regarding this agreement lies in the domestic sugar rebate. It affects directly the growers of small fruit and the canners of fruit in my electorate. I point out that roughly 90 per cent, of the small fruits of Australia are grown in my electorate, so members will appreciate that I have a very special interest in this matter on behalf of the fruit-growers. In 1931, when the price of sugar was £36 a ton, the rebate was £6 5s. a ton. It remained at that figure for some time, until it was reduced to £2 4s. a ton. Had the relationship of the rebate to the price of sugar been maintained, even in 1956, the rebate would have been of the order of £13 4s. a ton. What I do seek to establish, in speaking on this question to-day, is that the rate of the sugar rebate should be proportionate to the price of sugar. In 1960, the Government appointed a committee of three, under the chairmanship of Sir Mortimer McCarthy, a former chairman of the Tariff Board, to investigate the industry. The findings of the committee were referred to in the second-reading speech of the Minister for Primary Industry. He said -

The committee, which was appointed to investigate the sugar industry, was also commissioned to investigate the financial relationship between that industry and the canning fruits industry. In its report the committee said that it could see no fundamental reason why the stabilizing factor for the canning fruits industry should be provided through the domestic rebate system, and it recommended that future policy should be directed towards reducing the rebate and restricting its field of operation with the ultimate object of removing the rebate ararngement from the sugar agreements.

I know that my Queensland colleagues will quibble at this point, but I think it is not unfair to say that the sugar industry is a protected industry. I believe that is quite proper as far as the sugar farmers themselves are concerned. However, that is probably why the initial agreement provided that because the canners and processors could not buy the cheaper sugar which was offering on the world market - and is still offering - a rebate should be paid to them by the sugar industry as a form of recompense. I am disappointed with the findings of the committee insofar as they recommend a gradual cessation of the sugar rebate. I feel that it is still proper for the canners to expect a rebate from the sugar industry.

This rebate is passed on, in a way, to the growers of berry fruits. In particular, I am concerned about the growers of berry fruits in my electorate. During the war, berry fruit production was, perhaps, at its peak, because berry fruit juices were in demand as a source of supply of vitamins for the troops. Since the end of the war, however, the acreage for the production of berry fruits has declined by more than 50 per cent., and it is still steadily declining. It would be a pity, not only from the point of view of the unfortunate berry fruit farmers, but also from the point of view of the Australian consumers, if, by gradually decreasing the subsidy and then stopping it completely, there were practically no berry fruits industry in Australia.

The economic factor is very important to growers of berry fruits. May I state for the information of honorable members who are not familiar with the berry fruits industry that berry fruits are grown on very small plots of land which are not normally useful for any other crop. It would be a personal disaster to a grower of berry fruits to be forced by economic pressure to leave the industry. I want to make this point very strongly: I do not believe that the Government ought necessarily to accept the view of the committee of inquiry that the rebate should be gradually done away with. If that happens, there will probably be no berry fruits industry of any account whatever in Australia in the long run.

Debate (on motion by Mr. Coutts) adjourned.

page 1831

TARIFF BOARD

Reports

Mr FAIRHALL:
Minister for Supply · Paterson · LP

– I lay on the table of the House a report by the Tariff Board on the following subject: -

General textile reference interim report on continuous man-made fibre yarns.

I also lay on the table of the House reports by the Special Advisory Authority on the following subjects: -

Polyvinyl chloride resins and moulding compounds.

Slide viewers and slide projectors.

Ordered to be printed.

page 1831

RAYON YARN BOUNTY BILL 1962

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 amend the Rayon Yarn Bounty Act 1954-1959.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Mr. Fairhall and Mr. Adermann do prepare and bring in a bill to carry out the foregoing resolution.

Bill presented by Mr. Fairhall, and read a first time.

Second Reading

Mr FAIRHALL:
Minister for Supply · Paterson · LP

– I move -

That the bill be now read a second time.

The purpose of this bill is to amend the Rayon Yarn Bounty Act 1954-1959 so as to extend the operation of the bounty on sales of continuous filament acetate rayon yarn up to 30th June, 1965, and to increase the rate of bounty to 9d. per lb. of yarn. The original act followed a recommendation of the Tariff Board and authorized payments of bounty on rayon yarn sold for delivery in Australia in the three-year period which ended on 31st October, 1957.

The rate of bounty was prescribed as 6d. per lb. of yarn with a maximum amount payable in any one year of £100,000. A profit limitation was also provided of 10 per cent, per annum on the capital employed in the production and sale of the yarn. Following further reports by the Tariff Board, the act was amended successively in 1956 and 1959 to extend the operation of the bounty up to 30th June, 1962.

Courtaulds (Australia) Limited has been the only applicant for the bounty. Up to 30th June, 1961, it received bounty payments totalling £409,812. In the seven months ended 31st January, 1962, a further £46,061 was paid. The company manufactures the yarn at Tomago in New South Wales from cellulose acetate flake produced by Colonial Sugar Refineries Chemicals Proprietary Limited. This company receives a bounty of 7d. per- lb. on its sales of flake to Courtaulds. The cellulose acetate flake bounty covers such flake produced in Australia and sold up to 30th June, 1964, for use in the manufacture in Australia of acetate rayon yarn.

The Tariff Board, in its report on continuous man-made fibre yarns which I have just tabled, recommends: an increase in the rate of bounty from 6d. to 9d. per lb.; an increase in the maximum amount payable per annum from £100,000 to £130,000; and that the 10 per cent. limitation on profit should now be omitted from the act as profits are unlikely to reach this level.

The board also recommends that the bounty be payable on these terms for a period of three years, subject to the otherwise unaltered provisions of the present act.

The board considers that Courtaulds’ production is efficient and that bounty assistance should be continued. It believes that the bounty rate should be increased because returns to the company have been unreasonably low and because enhanced market prospects now justify recognition of more of the company’s installed capacity as contri buting to overhead changes regarded as reasonable for the purposes of assessing the appropriate level of government assistance.

The Government has decided to accept the recommendations of the Tariff Board, with the exception of that related to the profit limitation, and the bill now before the House gives effect to this decision. It has resolved that, in accordance with the usual custom, the profit limitation should be retained. The industry will again be examined by the Tariff Board before the expiration of the extended bounty period. I commend the bill to honorable members.

Debate (on motion by Mr. Pollard) adjourned.

page 1832

TARIFF PROPOSALS 1962

Customs Tariff Amendment (No. 21); Customs Tariff Amendment (No. 22)

In Committee of Ways and Means:

Mr FAIRHALL:
Minister for Supply · Paterson · LP

– I move - [Customs Tariff Amendment (No. 21).]

  1. That the Schedule to the Customs Tariff 1933-1962, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals, and that the amendment operate, and be deemed to have operated, on and after the thirtieth day of April, One thousand nine hundred and sixty-two, and that Duties of Customs be collected accordingly.
  2. That in these Proposals, “ Customs Tariff Proposals “ mean the Customs Tariff Proposals introduced into the House of Representatives on the following dates: - 22nd February, 1962; 7th March, 1962; 14th March, 1962; 28th March, 1962; 4th April, 1962; 10th April, 1962; and 12th April, 1962.

[Customs Tariff Amendment (No. 22).]

  1. That the Schedule to the Customs Tariff 1933-1962, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals and that, on and after the third day of May, One thousand nine hundred and sixty-two, Duties of Customs be collected accordingly.
  2. That in these proposals, “ Customs Tariff Proposals “ mean the Customs Tariff Proposals introduced into the House of Representatives on the following dates: - 22nd February, 1962; 7th March, 1962; 14th March, 1962; 28th March, 1962; 4th April, 1962; 10th April, 1962; and 12th April, 1962.

Mr. Chairman, the proposals to amend the Customs Tariff, which I have just moved, and in respect of which copies are now being circulated to honorable members, provide for tariff amendments on vinyl chloride polymers and copolymers, slide viewers and projectors and continuous man-made fibre yarns. The first two subjects arise from recommendations by the Special Advisory Authority, Sir Frank Meere, for the imposition of temporary duties pending examination of the needs for protection of these industries by the Tariff Board. The changes involved on continuous man-made fibre yarns arise from a report by the Tariff Board.

Tariff protection is maintained on acetate yarns and extended to yarns in chief part by weight of acetate. Honorable members will note that the bounty bill relating to the production of acetate yarns in Australia and now in its second-reading stage proposes that the assistance by way of bounty to the production of these yarns be increased. Protective duties on triacetate yarn, which is not produced in Australia, are proposed to be removed. The duties on imitation catgut are reduced to the level recommended by the Tariff Board in its recent report on monofilaments.

Mr Coutts:

– Did you say, “ imitation catgut “?

Mr FAIRHALL:

– That is a slight misnomer. I do not think the new line is an imitation of anything else. It is a product that stands in its own right, but it replaces the old-fashioned catgut. I am afraid the cat would be a little concerned at the replacement.

Three other minor amendments are proposed. That relating to ammonium nitrate ensures that the level of duties to those existing prior to 5th April, 1962, on explosive grade ammonium nitrate are continued, while maintaining free entry for fertilizer grade ammonium nitrate. I might mention that ammonium nitrate is imported into Australia only for use in explosives, the Tariff Board noting that this material was too expensive in relation to other sources of nitrogen for use as fertilizers. The other changes, which are essentially of an administrative nature, allow cocoa butter to be admitted under by-law at concessional duties for all purposes approved by the Minister for Customs and Excise. At present the only extension to the existing concession envisaged is to permit cocoa butter to be used in all types of confectionery as well as for chocolate confectionery as at present.

Provision is also made for the free admission of empty capsules made of unhardened gelatine. These goods were previously free of duty as being unspecified in the tariff. There are considerable imports of these goods and the provision of a separate item will ensure accurate statistics. These goods have a wide use in the capsuling of medicinal drugs as well as other uses such as capsules for lighter fluid. I commend the proposals to honorable members.

Progress reported.

page 1835

SUGAR AGREEMENT BILL 1962

Second Reading

Debate resumed (vide page 1831).

Mr COUTTS:
Griffith

.- The bill before us is one in which every citizen of Queensland has a vital interest because it provides for the maintenance of a protected industry in that State. We all admit that the sugar industry is a highly protected industry, but there can be no denying that the protection afforded to it over the years has been well justified from a national point of view because the tremendous settlement that has taken place in the coastal belt in north Queensland in recent years is attributable entirely to the sugar industry. It is true, too, that this industry could not have carried out the wonderful developmental programme it has in Queensland but for the protection accorded it by both the Commonwealth Parliament and the Queensland State Parliament.

The bill we are considering seeks to continue for another five years the agreement entered into between the Commonwealth Government and the Queensland Government. This agreement has now become part of the way of life in Australia and, lest it be taken as a matter of course, I suggest that it would be as well for us to review the history of the Sugar Agreement and some of the vicissitudes that confronted the industry in past years. The Sugar Agreement has its origin in the Sugar Purchase Act of 1915, which, I am happy to be able to say, was passed by a Commonwealth Government comprised of members of the party to which I have the honour to belong. I refer to the Labour Government led by a former honorable member for Wide Bay, Mr. Fisher, who was then Prime Minister, and a former honorable member for West Sydney, Mr. William Morris Hughes, who was then Attorney-General. As I have said, the Sugar Purchase Act of 1915 was the forerunner of the Sugar Agreement, and that legislation was bom at a time when Australia was at war, the reason for its introducton being that, due to the havoc wrought by a cyclone - cyclones have a habit of developing in northern Queensland - the Australian public was experiencing grave difficulty in obtaining sufficient sugar to meet the home consumption demand. At that time, the Australian Labour Party Government, led by Mr. Fisher, was aware of the needs of the Australian people, as Labour governments always are, and it introduced the Sugar Purchase Bill into the Parliament of the day.

The original proposal was to make available £500,000 for the purchase of sugar from overseas so that sufficient sugar would be available in this country. This was widely criticized. Mr. Cook, who was a Liberal member and the forerunner of Liberal members in this House, hotly opposed the proposition. He described it as an extreme form of socialism. Other members of his party, including Sir John Forrest, the Liberal member for Bunbury in Western Australia, were most critical of the proposal of the Fisher Government. But though they were very caustic in their criticism, they were not game to oppose the measure openly by voting against it. The interests of the people of Australia were at stake and the supply of sugar for the people was involved. 1 shall quote from some of the brilliant speeches of the great statesmen of the day, because I think it is appropriate that we have some of the history of the matter. I shall quote part of the speech of the Attorney-General, Mr. Hughes.

Mr Anthony:

– What year was this?

Mr COUTTS:

– The speech is to be found at page 6436 of “ Hansard “ for 31st August, 1915, in volume LXXVIII.

Mr Adermann:

– These are the records of 50 years ago.

Mr COUTTS:

– I am leading up to that. I will show how right the Labour Party was then, although it was criticized by the predecessors of the Minister for Primary Industry.

Mr Adermann:

– No, we did not have an Australian Country Party then.

Mr. COUTTS._Yes, Mr. Williams was here. I will show how we were criticized then and how to-day the Government is doing what we did then. Apparently we were right then because the Government is following the same course now. I will read from the speech of the Attorney-General, Mr. Hughes, who was honorable member for West Sydney. He said -

It represents the putting into force of the new Protection policy. X am sorry that these ideas do not meet with the approval of the right honorable member for Parramatta and his friends.

He, like the present member for Parramatta (Sir Garfield Barwick), was an arch conservative. Mr. Hughes continued -

They never will. They are, in effect - and I have no doubt the right honorable member realizes it fully - the writing on the wall. They mean the substitution of national control of industry for private control of industry. They mark, in a manner no thinking man can afford to neglect, the passing of private enterprise. This war has changed the outlook of the world. It will profoundly affect the future of civilization. Old landmarks are already buried beneath the dust of conflict. The unfitness of private enterprise to grapple with great emergencies has been amply proved. The British Government, that bulwark of private enterprise, had to buy sugar and wheat for the people of England because private enterprise was quite unable, or could not be trusted, to do so. War contractors, so the honorable member for Henty said to-night, are making great fortunes. The Commonwealth comes into this business to prevent any one making a great fortune out of sugar.

The Minister for Primary Industry a few days ago presented a bill to continue for another five years the sugar agreement, which is doing exactly what Mr. Hughes said in 1915 his bill would do. I suppose we should be grateful that the members of the Liberal Party and the Australian Country Party, who are the successors of the followers of Mr. Cook and Sir John Forrest, have learned their lesson. They agree that what our predecessors did in 1915 was right. I am sure that not one Liberal Party or Country Party member from Queensland would dare to say that the Labour government of Chose days did wrong in initiating the system that is now given effect in this national sugar agreement. We should be thankful that we had a Labour government in those days. I am sure that if this sugar agreement is not accepted unanimously it will at least not be opposed by any member of this Parliament.

So much for the origin of the scheme. Let us now consider what effect the agreement has had on Queensland. The sugar industry has had its vicissitudes. Sugar was cultivated first by indentured labour, by kanakas who were black-birded from the islands. One of the sorry episodes in Queensland’s history is that the islanders were brought here under the most shocking conditions. Traders more or less slaveraided the islands to bring kanakas to Australia. It is to the credit of the man whose name is given to the electorate I have the honour to represent, Sir Samuel Griffith, the Premier of Queensland at the time, that in the 1 890’s he made the first move for the removal of kanakas from the Queensland sugar industry. Since the 1920’s in particular the industry has been entirely a white man’s industry. It is the most efficient sugar industry in the world. The sugar content of the cane is as high as the best in the world and the land is as productive as the best sugar-growing land in the world. Queensland has much of which to be proud with its sugar industry.

Sugar is the most important primary industry in Queensland. According to the Queensland Year Book, the value of sugar cane cut for crushing in 1961 was £41,000,000. This cane was produced on 299,000 acres. The next most important agricultural product was wheat, and 683,000 acres were used to produce wheat of the value of only £9,500,000. The importance of sugar to Queensland can be readily seen. It has been responsible for the maintenance of stability and the settlement of the coastal part of north Queensland. This stability derives from the fact that the Commonwealth Government prohibits the importation of sugar. The agreement, which provides that the Queensland Government shall become the purchaser of sugar produced in Queensland and in northern New South has also contributed to this stability. We must not forget that northern New South

Wales is involved also. The farmers of the rich Richmond area can attribute their prosperity to successive Labour governments in Queensland which have jealously safeguarded the agreement with the Commonwealth Government to protect the sugar industry.

The efficiency of the industry cannot be denied, and all sections have worked wholeheartedly to promote and maintain that efficiency. The record of the workers in the industry is outstanding and the producers of the crop have been most co-operative in developing the industry.

To-day, the industry faces problems arising from mechanization and automation. These problems have become very real in northern Queensland, where the so-called sugar towns are being denuded of men. Already, the Queensland Housing Commission admits that there is no problem in providing homes there because the population is moving away. We have mechanization in the cutting and loading of cane, and this process is extending. The extent of the problem is illustrated by an article published by the National Bank of Australasia Limited which stated -

The proportion of the Queensland sugar crop cut by machines increased from 2.7 per cent, in 1960 to 5.4 per cent. last year but the percentage in districts north of Townsville -rose from 1.9 per cent, to 6.7 per cent. For the third year in succession, crop conditions were very suitable for mechanical harvesting. Slightly more than 4.6m. tons of cane, equivalent to 51.4 per cent, of the crop, was mechanically loaded as against 47.8 per cent, in the 1960 season. Over 2,500 frontend loaders were used in addition to 105 loaders of other types including harvesters which also load cane.

It is evident that the mechanical harvester and cutter is being developed on very efficient lines. The loading of cane is done largely mechanically. These processes are eliminating to a large extent the cane cutters who laboured in the field. Worse still, bulk loading is being employed at north Queensland1 ports. This is really causing great hardship and promoting unemployment among waterside workers in those ports. At Mackay, which was the first port to use bulk loading methods for sugar, about 400 waterside workers have been deprived of their employment. Further up the coast, to Lucinda and other ports which are purely sugar ports, the waterside workers have disappeared because of these push-button methods.

Unfortunately, this use of mechanization and automation has not brought about a reduction in the price of sugar to the Australian consumer. All the value derived from mechanization is going back into the industry itself. It is noteworthy that the committee of inquiry which was appointed to investigate the industry made a report to the Government couched in such terms that, had the report been adopted, the Australian consumer would have paid a half-penny per lb. less for sugar; but the Government has seen fit to reject that clause of the committee’s report and consequently the price of sugar will be maintained at the present level.

I regret to have to admit that there is a falling-off in employment in the industry, but that goes with mechanization and automation. I hope that in due course, when investigations are made into the future of the industry, some concern will be shown for the welfare of the people who are deprived of their employment through the use of automation and mechanization.

The sugar industry itself is facing grave problems at present because there is a good deal of over-production. The total production last year was 1,287,000 tons, and, of this quantity, 713,000 tons was available for export. So we are producing in Australia more than twice the amount required for internal consumption. This poses grave problems for the industry. We know that the members of the Government and all thinking persons are worried about the probability of the United Kingdom entering the European Common Market. The sugar industry is one industry that could be gravely affected by this development. That is evident when we realize that we are producing twice the amount of sugar we require for home consumption and are beholden principally to the United Kingdom for an export market for our sugar. In the year ended June, 1961, the United Kingdom took from Australia 329,000 tons of sugar, of a total export of 796,000 tons. Canada and Japan, in that order, were the next largest buyers of Queensland sugar.

Recently, because of the revolution in Cuba and the ban by the United States of

America on trade with that country, Australia has received a quota of 90,000 tons of sugar for export to the United States. However, in my opinion it would be fatal for Australia to depend for the stability of any of its primary industries on markets in the U.S.A. We all know the difficulty that the wool industry has encountered in exporting wool to that country. We have a market for 90,000 tons of sugar in the United States merely because that country finds itself at variance with the Republic of Cuba. When their difficulties are resolved - and I have no doubt that they will be resolved in due course - Australia will lose that market.

The industry has appealed to the Minister for Trade (Mr. McEwen) to seek new markets for our sugar while he has been overseas. This is a matter of grave concern to every Queenslander because this year sugar will earn for Queensland more than £65,000,000, and the economic stability of the industry is of the utmost importance to Queensland in particular. If there were any decline in the value of the crop or the availability of markets, there could be an agricultural and economic depression in the coastal belt of Queensland, because of its dependence on the sugar industry. Many industries depend for their stability on the Queensland sugar industry. It is a large consumer of fertilizers and is also an important customer for the engineering trade. Dotted up and down the Queensland coast there are many engineering works which depend entirely on the Queensland sugar industry for their prosperity. So it is in the interests of Australia, and of Queensland in particular, that this industry should be maintained.

I am happy to associate myself with the bill before the House, and I am sure that it will be approved by honorable members. Although some honorable members may have their own ideas on this matter, I am sure that none of them will oppose the passage of the bill. It justifies the white Australia policy, with which the Australian Labour Party completely associates itself. We who belong to that party are pledged to the maintenance of this policy. The Australian sugar industry is based on white labour, and the Australian Labour Party is determined to keep it that way. The industry has amply justified its existence. It had added to the prosperity of this country and has made possible the settlement of the northern part of Queensland, which is the most prosperous and most productive area of the Commonwealth of Australia.

Mr ANTHONY:
Richmond

.- Mr. Deputy Speaker, it is very pleasing indeed to have all honorable members on both sides of the House supporting this bill, which will approve the renewal for the next five years of the sugar agreement entered into between the Commonwealth Government and the Queensland Government. This agreement regulates the production as well as the marketing of sugar in this country. I think that the only point of difference between honorable members on opposite sides of the House arises over the question of who should be recognized as having originated the sugar agreement. I should like to deal with that point a little more fully later.

For the benefit of those honorable members who perhaps do not know much about the sugar industry, I should like briefly to outline its history. The sugar industry in this country began at Port Macquarie in New South Wales in 1823. The climate there was found to be a little too cold, and the industry moved farther north to the valleys of the Clarence, Richmond and Tweed Rivers in the region of my electorate. It became well established in New South Wales in the 1870’s and 1880’s. About the same time, the industry began to develop in Queensland and spread northwards up the coast of that State until to-day it is perhaps the major industry of Queensland, as was pointed out by the honorable member for Griffith (Mr. Coutts).

The Queensland sugar industry produces about 9,000,000 tons of sugar cane a year. The New South Wales industry produces 550,000 tons of cane. So it must not be accepted that Queensland provides all the sugar produced in Australia. New South Wales produces a considerable proportion. Altogether, there are about 9,000 sugarcane farmers in Australia. So this is a very big industry. It is very important to those people and to all who are allied with the industry - the cane-cutters and the suppliers of machinery and fertilizers and so on - that the sugar industry be kept stable and financially healthy. There are in Aus tralia 34 sugar mills producing raw sugar, and we have six sugar refineries throughout the country. Annually the industry earns Australia about £30,000,000- sometimes more and sometimes a little less.

I think that the most important feature of the industry is that it has decentralized development and attracted population to areas which would probably support only very slender populations without such an industry. The cane-fields extend about 1,300 miles up the east coast of Australia from the Clarence River valley to a point north of Cairns. Most of the area has a very high rainfall, but much of the ground under cane would not be satisfactory for other forms of agriculture. Much of it is low and wet, and I do not think we could find any other agricultural industry that would be as profitable in most of these areas.

The great thing about the Australian sugar cane industry is its efficiency. Ours is the most efficient sugar-producing industry in the world which is based on European labour. That is something of which we ought to be proud. This industry is so efficient because it has always been forwardlooking and had an aggressive outlook. Those in it have tried to help themselves. They have adopted the most modern techniques and developments and have spent tremendous sums of money on research in order to improve the productivity of each acre of land. Mechanization on the farms has been greatly developed and much has been done to control pests and diseases. I think that, as a consequence, methods of cultivation in our sugar-cane industry are as good as are those in the industries of any other country. In Queensland, five big organizations are working on research for the industry. These are the Queensland Bureau of Sugar Experiment Stations, the Colonial Sugar Refining Company Limited, Sugar Research Limited, the Commonwealth Scientific and Industrial Research Organization and the University of Queensland. These organizations, jointly, spend about £800,000 a year on research in the field of mechanization, marketing and the control of pests and diseases.

I should like to give the House some idea of the improvement in efficiency that has taken place over about the last 30 years.

The production of I ton of sugar used to require 14 tons of cane. The latest figures available are those for the year 1961. In that year, only 6.86 tons of cane were needed for the production of 1 ton of sugar. So the productivity of sugar cane has been increased by more than 100 per cent. Production from each acre under cane, also, has increased by 100 per cent. We used to average about li tons of sugar to the acre. We are now getting 3 tons of sugar from every acre of land under cane. These figures clearly indicate the degree to which the efficiency of the industry has been improved.

It has been said occasionally that the Australian price of sugar is too high, but I cannot agree with that argument. I have here some figures which show the retail prices of sugar in various countries. They have been compiled by the International Sugar Council. In every country that has a standard of living similar to that of Australia, the retail price is about the same as the Australian price, or a little higher. In some of the less well developed countries, the retail price of sugar is substantially higher than is the price in Australia. In Yugoslavia, the retail price is highest. There, the retail price of sugar is nearly three times the retail price in Australia. This country has been able to keep its price down because the industry here has been mechanized. When I speak of keeping the price down, I am referring, of course, to industries based on European labour.

I doubt whether there is another agricultural industry in Australia that employs so much mechanical horse-power to the acre for the production of a crop as does the Australian sugar industry. A few years ago, many horses and much manual labour were used in cultivating the fields of cane and in harvesting and other activities associated with the industry. To-day, almost every sugar-cane grower has at least two tractors. The farmers have done away with horses. They are applying a great deal of fertilizer and using machinery to load the cane on to rail and road trucks. They use many kinds of mechanical apparatus for spraying, the application of fertilizers, planting and the spreading of fungicides and various preparations to ensure increased productivity. 1 should like to give the House some idea of the mechanization that has taken place in the industry. In 1961, 57.4 per cent, of the cane loaded in Queensland - loading is a very heavy job - was handled by mechanical loaders. The percentage of cane cut by mechanical cutters in 1961 was 5.4. That was an increase of 100 per cent, compared with 1960, when 2.7 per cent, was cut by machine. This trend will continue. We have seen great developments in the bulk handling of sugar. It has been adopted at five major ports in Queensland. Also, in New South Wales under this bulk handling system, the sugar is not bagged. It is put straight into bulk trucks and taken to Brisbane direct by road or else delivered to bulk-loading centres for loading into bulk containers on rail or in ships for transport to Sydney for refining.

The honorable member for Griffith (Mr. Coutts) said something about the sugar agreement, and in this respect I want to make the position clear.. If there was one thing that brought about the formation of the Australian Country Party it was the injustice that was meted out to sugar-cane growers during the First World War and immediately afterwards. The main reason for the formation of the Country Party was a desire to see that sugar-cane growers were treated justly. Let me tell the House what happened at that time. When the First World War broke out the Fisher Labour Government desired to acquire all the sugar in Australia. It admittedly lifted the price slightly. The previous price was £14 15s. 6d. a ton and it was increased to £18 a ton. That was at the beginning of the war, but the Government made no subsequent alteration in the price.

In 1917 a judgment made by Judge Dickson in the Arbitration Court resulted in the cost of sugar production being pushed up to such an extent that the great bulk of the sugar cane produced was left to rot in the fields, because the growers found that it was uneconomical to harvest it. Australia then was not producing and processing enough sugar to feed its people. The governments of the day - not only the Labour government but also the Hughes Conservative Government that followed immediately afterwards - would not give the producers a price sufficient to enable them to make a living out of sugar-cane production, so they found it necessary to import sugar at prices ranging from £44 to £90 a ton. This was at a time when the Government was paying Australian producers £18 a ton.

As a result of the development of this situation, the Australian Country Party was formed. Of course the plight of the sugar industry was not the only reason for the formation of the party, which was concerned also about problems in the wheat and dairying industries. However, I can fairly say that one of the main reasons for the formation of the Australian Country Party was the unjust treatment being meted out to sugar-cane growers. No man could take more credit for helping to bring into existence the Australian Sugar Agreement than the late right honorable member for Cowper, Sir Earle Page. He fought for it all the way. It was the Country Party that suggested that the only sure way to gain a fair deal permanently for sugar-cane growers was to secure allies in Australia in other industries which had a permanent and lasting interest in the use of sugar. As a result, attempts were made to ally the canning people and the confectionery people, as well as those people in the dairying industry who were concerned with the use of sugar for sweetening milk products, with the sugar-cane growers. This suggestion was placed before them. In this connexion the work of Mr. S. D. Walker, of the Bundaberg “Daily News” will always be remembered, as well as the efforts of Mr. Dougherty, the secretary of the cane growers’ association.

At the suggestion of the Australian Country Party, which had been formed only two years before, a tour was made of the southern fruit-growing areas, and the assistance of those interested in fruit growing was enlisted. At the Country Party conference in Adelaide in 1922 a recommendation was adopted that the party should press for an agreement. As a result, when the Bruce-Page Government was formed, one of the first tasks of the Country Party was to press for this agreement, which came into being in 1923 for a trial period of two years. The basic features of the agreement are the same to-day as they were in 1923. Let me remind the House of the main features of the Austra-

Han Sugar Agreement. They are as follows: -

  1. The Commonwealth Government prohibits the importation of sugar into Australia.
  2. The Queensland Government, under its

Sugar Acquisition Act of 1915, acquires the raw sugar output of Queensland mills, and purchases the sugar produced by the three New South Wales mills.

  1. The Queensland Government arranges for the refining of sugar consumed within Australia, and supplies refined sugar to wholesalers and manufacturers at a price that is uniform in all State Capitals.
  2. The Queensland Government sells to buyers overseas raw sugar that is surplus to Australian requirements.
Mr Pollard:

– The Commonwealth Government never acquires the sugar crop; the Queensland Government does that.

Mr ANTHONY:

– I know it does. The Queensland Government arranges for the purchase of the sugar, but only because the Commonwealth Government agrees that it should do so. And this could never be done unless the fruit producers were on side. As a result of these arrangements we had a gentlemen’s agreement that beet sugar would not be produced in Victoria.

Mr Pollard:

– You had nothing of the sort.

Mr ANTHONY:

– There is a gentlemen’s agreement.

Mr Pollard:

– I happen to know that that is not so. It is a complete fallacy.

Mr ANTHONY:

– At any rate, I think it is clear that the Bruce-Page Government can take credit for arranging the sugar agreement in Australia. As I said before, it is very pleasing to see the Labour Party supporting this agreement, which was brought into existence by a very famous man.

There are two main political issues of interest in connexion with this bill. First, there is the question of the publication of the report of the sugar inquiry committee, and secondly, there is the matter of the Government’s rejection of the majority recommendation of the committee that the price of sugar be reduced by a id. per lb. This was the matter mentioned by the honorable member for Griffith (Mr. Coutts). The honorable member brought this matter up, but he did not say whether or not he agreed with the recommendation. It would be interesting to know the attitude of the Labour Party on this point.

Let me return to the first of these issues, concerning the publication of the report of the committee. The details of cane-growers’ and raw sugar millers’ costs were given to the committee by representatives of the sugar industry in confidence and were not for publication. The sugar industry representatives urged that the cost of production should not be made public at a time when major negotiations were pending with the United Kingdom Government in respect of the Commonwealth Sugar Agreement and the European Economic Community, and with the United States Government over access to the United States market for sugar. The British Commonwealth Agreement makes provision for a uniform price payable to all British Commonwealth sugar producers which is to be “ reasonably remunerative to efficient producers”. Obviously costs of production are significant in negotiations under the British Commonwealth Sugar Agreement.

The second issue concerning the rejection of the recommendation of the majority of the committee is a very important one. On 22nd January the Minister for Primary Industry (Mr. Adermann) made an announcement in which he said -

However the Commonwealth Government had taken a definite position on certain major recommendations in the report relating to the domestic price of sugar in Australia.

A majority of the Committee had recommended an amended formula for determining the home consumption sugar price which if adopted would have the effect of reducing the current retail sugar price in Australia, thereby reducing returns to the sugar growing industry. Moreover it would adversely affect the interests of sugar growers in future years.

Since the Enquiry Committee had conducted its investigations, the world sugar situation and the future sugar marketing outlook had deteriorated considerably.

In the circumstances the Government was not prepared to accept this particular recommendation and the Queensland Government had been informed accordingly.

A number of important things have happened to change the outlook for sugar since the inquiry was conducted. The appointment of the committee was announced on 28th November, 1960. The committee’s first hearing was held on 31st January, 1961, and the inquiry was concluded on 28th March, 1961. Since that time the following important changes have occurred. First, the International Sugar Agreement has collapsed. Secondly, the United Kingdom has announced its intention to negotiate with a view to joining the European Common Market. Thirdly, the world price of sugar has slumped to a very low level, the lowest for a number of decades. Fourthly, Cuba, which was a dominant exporter of sugar, has alined herself openly with the Communist countries. These important considerations were not taken into account by the committee in making its recommendations.

As to the figures of cost of production, the committee could not have considered figures any more recent than those for the 1960 season. It seems that if the committee had considered cost of production figures for the 1961 season, a different picture might have emerged, because it now seems that the yield of sugar per acre in 1960 was abnormally high. While sugar content was reasonably high for 1961, the yield per acre was the lowest since 1955.

Australia has always been an advocate of international co-operation in the marketing of primary commodities. Until recently, sugar marketing has given one of the best examples of international co-operation. Under the auspices of the United Nations organization, an international sugar agreement was negotiated in 1953. Both producing and consuming countries were party to the agreement, which laid obligations on both producers and consumers in the interests of both. The main objective of the agreement was to assure supplies of sugar to importing countries and markets for sugar to exporting countries at equitable and stable prices. The 1953 agreement was supported by a majority of important producing and consuming countries, and it and similar agreements have done much to stabilize international trade in sugar in the last eight years. A new agreement was negotiated in 1958, with provision for review in 1961.

The 1961 review of the International Sugar Agreement had to be undertaken in circumstances dramatically different from those under which it was negotiated in 1958. The Castro Government had since come into power in Cuba and had alined itself with Russia, mainland China and the Soviet satellites in Europe instead of with the United States. The previous Cuban Government, whatever its faults in other directions, had always shown a wish for stability in the international sugar trade and a desire to co-operate with other countries in the orderly marketing of sugar. The Castro Government, on the other hand, exceeded its quota under the International Sugar Agreement for 1961 by something in excess of 1,000,000 tons. Other countries lost confidence that Cuba would adhere to future obligations under the agreement, and the United Nations conference was unable to reach agreement on quotas. Accordingly, the sugar conference adjourned, leaving in suspension the quota provisions of the International Sugar Agreement, and most of the other operative provisions as well. The failure of the United Nations sugar conference was not finally apparent until December, 1961, and since then the free market price for sugar on the world market has slumped very dramatically. To give some indication of what the slump has been I point out that for a period of eight years we had a world price ranging in the vicinity of four American cents per lb. In January, 1962, the price reached an all-time low of 2.24 American cents per lb. - getting near to 100 per cent, drop in the world market price. In the month of February, 1962, the price rose to 2.36 cents and in March to 2.65 cents.

The Government firmly believes in international co-operation in these commodity problems. The Government’s representatives and the sugar industry advisers at the United Nations sugar conference made every effort to retrieve the agreement, but the forces on the other side were too great. The sugar trade has now become an arena of East-West politics, with the Soviet bloc seeking to embitter relations and raise tension between the United States of America and Cuba. This is not a situation in which it would be appropriate to weaken the sugar industry’s stabilization arrangements, and any reduction in price as recommended by the majority of the committee would definitely weaken the arrangements. I am sure that had the committee known that the International Sugar Agreement was to break down it would never have recommended a reduction in price.

Then we have the additional fact that Britain is likely to enter the European Common Market. This could have very harsh effects, although I would be somewhat of a prophet of gloom if I were to say that it would be disastrous to the sugar industry. I think that in the long run it might be all right for the industry, and it certainly does not do any good to the industry to have undue pessimism about it, which would deflate values and affect the enthusiasm of the people who work in the industry.

Mr COUTTS:
GRIFFITH, QUEENSLAND · ALP

– But it must be looked at realistically.

Mr ANTHONY:

– There might be some degree of uncertainty, but do not let us say that the industry faces ruin, because we do not know the conditions under which Britain will enter the European Common Market. It is very likely that the conditions will provide for Australia still to have access to the British market for sugar.

Yield is a very important factor affecting the cost of production of any farm commodity. The latest evidence on costs given to the Sugar Inquiry Committee was for the 1960 season, and the committee’s recommendations were presumably based on the 1960 season. Information about the 1961 season which has since become available shows that the 1960 yield may have been abnormally high. I have here figures of the sugar yield per acre for various years. They show that the per acre yield in 1961 was considerably less than the average for the previous three years.

The sugar industry, fearing the consequences of the establishment of the European Economic Community and Britain’s entry into that organization has engaged in a definite drive to establish more export markets for its products throughout the world. It is very pleasing to note that the Japanese Trade Agreement has been of tremendous benefit to the industry, and I think that we on this side of the House can take great credit for bringing that agreement about. The members of the Opposition opposed the agreement - an agreement achieved by Mr. John McEwen, the Leader of the Australian Country Party, who had enough foresight to see the ramifications it would have. In the four years up to 1956-57 we sold a yearly average of 46,000 tons of sugar to Japan. In the year of the agreement we sold 52,000 tons. The yearly average of our sales of sugar to Japan in the four years since the agreement was 118,000 tons - almost twice in volume and value the yearly average for some time before the agreement was reached. This year it looks as though we will raise our sales to Japan to as high as 250,000 tons, which will be an all-time record.

We have also pressed ahead with the establishment of more markets in Canada, and to-day sugar is our largest export to that country and is our greatest earner of Canadian dollars. The sugar industry is making arrangements with Japan to bulk handle all our sugar sent to Japan, so that Japan will be able to use those bulkhandling facilities to get sugar to the consumers at the cheapest possible price. This will mean that Japan will have to buy bulk sugar, and this will be of great benefit to Australia, because we are now supplying nearly all our sugar in bulk. The homeconsumption price of sugar in Australia is reasonable. Evidence given to the committee shows that the Australian homeconsumption price is as reasonable as, if not more reasonable than, the homeconsumption price of sugar in any country with similar living standards.

The honorable member for Franklin (Mr. Falkinder) mentioned the rebate which the fruit industry enjoys. Under a provision of the agreement the sugar industry makes very large concessions to the canning fruit industry. For fruit or milk products with a sugar content canned and exported the canners obtain their sugar from the Australian sugar industry at the world parity price. If the commodities produced are to be used in Australia the canners get a special rebate, and that rebate was increased about two years ago from £2 6s. 8d. a ton to £5 a ton. This rebate was given when we had the last increase in the price of sugar because we felt that it was only reasonable that these people should have a slightly larger rebate. However, to suggest that the Australian consumer should buy Australian sugar at the world parity price is, I think, most unreasonable, because the price of sugar that is sold in Australia to producers of other commodities is based upon Australian costs. It is based on the cost of labour, which is determined by the Commonwealth Arbitration Commission, and also on the cost of fertilizer and other commodities required for the production of sugar. The people who use that sugar in other forms of production should, therefore, be willing to pay at least something near what the sugar costs to produce. As I have said, the sugar industry has generously given a rebate of £5 a ton on all sugar used in the production of canned fruits, confectionery and other commodities consumed in Australia. I want to reiterate a point I made earlier in reply to the honorable member for Griffith (Mr. Coutts). If any party in this House can take credit for the Australian Sugar Agreement, it is the Australian Country Party. It was the trouble in the sugar industry at that time which brought about the formation of the Australian Country Party. In my own electorate Mr. Massy Greene, a member of the Nationalist Party, and then a Cabinet Minister - he probably would have been Prime Minister of Australia - was beaten on the sugar issue. He was beaten because the sugar producers were not getting a fair price. His Country Party opponent, who was virtually unknown, beat him. Mr. Massy Greene was probably one of the greatest statesmen in Australia at that time, but because of the injustice to the sugar industry-

Mr SPEAKER (Hon Sir John McLeay:
BOOTHBY, SOUTH AUSTRALIA

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

Mr HARDING:
Herbert

.- Mr. Speaker, coming as I do from what is probably the largest sugar-producing electorate in Queensland, I am pleased to support this bill. The electorate of Herbert produces about 3,000,000 tons of sugar cane annually, or about one-third of our whole output. The fact that the Sugar Agreement has remained unaltered for 40 years is sufficient evidence of its value and of the fact that it is doing a good job. The sugar farmers would not know who introduced the agreement legislation in the first place, and I doubt whether they would care. Many sugar farmers and other residents of the sugar-growing areas are the second and third generation of people in the northern part of Australia, so I do not think it matters who introduced the Sugar Agreement. The fact that it is there and that it has survived for 40 years is, I think, pleasing to everybody.

It has been said that north Queensland would not be what it is to-day without the sugar industry. That is true, and I need not dwell on that. There is no gloominess among the sugar farmers regarding Britain’s proposed entry to the European Common Market. It had me worried at one time but I think the honorable member for Richmond (Mr. Anthony) can be assured that where I come from the people are extremely optimistic and have no doubt that something will happen to pull the sugar industry through whatever problems may turn up. At this stage nobody knows what will happen or what the ramifications will be when England joins the Common Market, assuming that she does so. At the moment the sugar industry is healthy and in a satisfactory condition. The fact that the price of cane farms is still terrific is sufficient evidence of that. Quite a bit has been said about fruit canning and so I think it is only fair to refer to the McCarthy report on the Australian manufactured fruits industry. I will read portion of the report, which is as follows: -

  1. The section of the manufactured fruits industry responsible for growing the fruit includes growers of various kinds of fruit; it operates in areas that are widely separated; it has farms of different sizes; farms with and without irrigation; farms growing wholly for processing and others supplying the fresh fruit market as well; mixed farms and farms that grow nothing but fruit; farms with fruit as a sideline and others with fruit as the main source of income; and farms, so diverse in cultural practices, requirements, and problems, as to justify the abandonment of any attempt to consider the growing section as a single entity.
  2. The processing section is similarly diverse. It consists of fruit canners, jam makers, juice extractors and so on, either as separate units, or in a single factory, the prevalence of co-operatives in the processing of fruits, so links the financial interests of some processors and groups of growers, that it is difficult to consider the two sections separately.
  3. Because of this diversity it was not possible for any one, or even for all, of the witnesses at the inquiry to give the Committee a comprehensive view of the manufactured fruits industry and its problems. The inquiry disclosed a great weakness in statistical data relating to the production of fruit, and to the profitability, or otherwise, of various sections.
  4. There was agreement, among growers and processors, that without the export rebate on the sugar content of processed fruit products, Australia’s competitive position on overseas markets would be considerably weakened.
  5. There was agreement that the domestic rebate of £3 per ton on sugar used for processing fruit, has little effect on the prices paid by processors for fruit, or on the prices paid by consumers for the processed products.
  6. Nevertheless, the domestic rebate is of great value to the fruit industry because of the condition that it is available only to those processors who pay growers the minimum prices determined by the Fruit Industry Sugar Concession Committee. This is a price stabilizing factor of great importance to growers and enables co-operative processors to contract for supplies in the knowledge that their proprietary competitors are paying the same prices.
  7. The relationship between the manufactured fruits industry and the sugar industry is good, the former realizing that the sugar industry has been very co-operative, and the latter admitting that a successful domestic fruit processing industry provides an outlet for sales of sugar.
  8. The financial arrangements between the two industries are based on the system of export and domestic rebates, which is administered in a way that causes no particular problems.
  9. The fruit industry would like the rebates to be higher, but, except in isolated cases, made no request for an increase in either the export or domestic price.

I think that covers that, Mr. Speaker. We have the problem that in this industry there are very few by-products. In the north there is some production of liquid molasses, fortified with vitamins, as cattle feed, but that seems to be the limit of by-products apart from syrup and a few other things which do not amount to much. A certain amount of stock feed is produced from the megass - the cane residue - but much of the megass is used in the furnaces. Some of the mills are not equipped to burn megass and instead burn wood, but I think about 90 per cent, of them use the megass.

The average person to-day who has not an intimate knowledge of the conditions prevailing in this type of agriculture regards the sugar farmer as something of a gentleman farmer who does not do much for his money. I refute that argument because it is not true. Cane growers work very hard and need a terrific amount of equipment, including perhaps two or three tractors as well as all their other plant. Overall, comparing the return from the sugar farm with that from money invested in retail or other types of business, the return to the sugar farmer is not excessive. In my opinion it is rather meagre.

We know that over the years the sugar millers have done a tremendous job in the sugar mills. The new equipment and the degree of mechanization are amazing. But with mechanization has gone a reduction of labour. In the Colonial Sugar Refining Company’s mills alone, in the year before last, automatic fugals were introduced and each did away with about five fugal men. This equipment works by compressed air and no labour is needed for this work. On the sugar boiling floor there used to be two or three men for each sugar boiler, but they are gone too and the work is all done by electronics to-day. That is a problem in the northern part of Australia now, particularly as there are no subsidiary industries in that area. The centres are purely sugar towns and when you take the men away from the sugar industry you take them out of the towns and that is a big problem. We feel that with the advent of mechanical harvesting the position will be worse. The average grower to-day would prefer a manual harvester - a man cutting his cane - for the simple reason that the weather does not affect him and he does not break down, because he is used to it. In the areas where there are few labour troubles, such as the Burdekin delta, I do not think that mechanical harvesting will present an employment problem for some time. I believe that the danger there is overestimated at present. That applies, too, up around the Tully area, which is unsuitable for mechanical harvesting because it is mostly hilly country. Even so, last year the Australian Workers Union, which supplies most of the labour for the sugar industry, was 700 men short on its books between Mackay and Ingham. That is a considerable number, and this year it is expected that more cane will be harvested .with less labour. There are two types of mechanical harvesters in production and in use at the moment. There is the whole-stalk harvester, which pulls the cane up completely, cuts the top off it and loads it. Then there is the Massey-Ferguson machine, which chops the cane into lengths of about 1 foot. That machine is the more popular. But the fact remains that, in order to use it, it is necessary to convert trucks with a wirenetting container. That is holding up the introduction of the Massey-Ferguson machine. Nevertheless, these machines are becoming more efficient and I think we shall see more of them in use as time goes on. However, I maintain that unless suitable labour can be kept available for cutting in the sugar industry, the industry will not make good progress.

That is all I have to say on this bill. I commend it to the House. It is a good bill and I know that it will meet with the approval of people in the northern area of Queensland. No primary industry in this country deserves to be looked after more than the sugar industry. It is a pity that, as time has gone by, we have not stabilized a few more industries in the same way.

Mr DAVIDSON:
PostmasterGeneral · Dawson · CP

– It is very pleasing indeed that this bill is receiving the support - apparently the unqualified support - of honorable members on both sides of the House. This is pleasing because of the bill’s great importance, not only to the sugar industry, but to the State of Queensland and to Australia as a whole. I was interested in the comments of the honorable member for Herbert (Mr. Harding), who has just spoken. The only point that he made on which I might take issue with him was the statement that he thought that he represented the largest sugar electorate in Queensland. I have not seen the figures showing the actual tonnages produced in the last year or two by the various sugarproducing areas, but I remind the honorable member that there are ten sugar-mills in my area. I know that the honorable member has some big mills in his area. However, that is by the way.

I was interested, also, in the comments made by the honorable member for Richmond (Mr. Anthony). In his speech, he gave a complete coverage of the whole industry and dealt very conclusively with this bill. I was particularly interested to hear him deal, in reply to a comment, with the service which the Australian Country Party has rendered to the sugar industry through the years. We know that the industry has been supported in Queensland, and in the federal sphere, by successive governments - either Liberal-Country Party or Labour - but there are not many people who know that the present structure of the industry is based on legislation introduced in the early years of the century - particularly the Central Sugar Cane Prices Board legislation. The whole of the present system of production control and price control is based on that legislation. It was drafted by Colonel

Rankin, the father of our friend in another place, and by an old friend of mine called Ted Swayne. They were both members of the Australian Country Party. Unfortunately, they were not able to present their legislation to the Parliament themselves, because the government that they supported was defeated at a general election. However, the legislation which they had drafted was so good that it was taken up immediately by those who took over the reins of government. Since then, it has been built on steadily. So the Australian Country Party can claim that it played a major part in the determination of the early structure of the industry - a structure which has been built upon so successfully since.

This bill, as has already been pointed out, extends the long-standing agreement between the Federal Government and the Queensland Government. As the bill has been covered so fully already, I do not intend to traverse much of what has been said, but there are a few points which I should like to make. The agreement regulates, first of all, the volume of production in the sugar industry and provides for the marketing of that portion of the crop which is sold in the Commonwealth. It is pleasing to see that the bill proposes to extend the agreement for a further six years as from 1st September, 1961.

There is little difference, as the Minister for Primary Industry (Mr. Adermann) said in his second-reading speech, between this agreement and previous agreements. It results from the deliberations of a committee of three men, headed by Sir Mortimer McCarthy, which was appointed to inquire into the industry and its relationship with the fruit industry and to recommend whether radical changes should be made in any aspect of the industry’s operations. Sir Mortimer McCarthy, who I think was then Mr. McCarthy, was also the chairman of the 1952 sugar inquiry. The report of that inquiry has since come to be regarded as being in the nature of the sugar industry’s bible. It gave particular satisfaction, first of all to the industry, and then to both the governments associated with the matter, to see that the most recent inquiry again acknowledged the high efficiency of the industry and said that there was evidence of constant striving to improve that efficiency from time to time.

Tt will have been noted that the Government has not adopted the committee’s recommendations in full. One major recommendation and one or two minor recommendations have not been adopted. It is of the major one that I wish to speak. The major recommendation which has not been adopted is for a variation of the formula, which has existed for a number of years, on which the domestic price determination is based. That formula applies to a certain quantity of sugar, composed of the total sold on the home market plus exports produced within what we call the mill peak system. For the benefit of those who are not accustomed to the economy of the industry, it is important to explain that there is a difference between what we call export sugar and excess sugar. I think that in some of the discussions which have taken place in various places in the last few months some people have failed to appreciate the difference between excess sugar, which is sugar beyond the mill peaks, and export sugar. The former is sugar the loss from which the industry itself carries, accepting only the market price. Export sugar is sugar which is exported and which has been produced within the total of the mill peaks.

The recommendation in the majority report that there should be a variation in the formula meant that the total quantity previously used for this determination should be reduced somewhat. This would be a very serious matter for the industry. It was proposed that that quantity, instead of being the home consumption quantity plus all the export sugar within the mill peaks, should be an amount equivalent to twice the amount of home consumption. This would mean a reduction of several hundreds of thousands of tons of sugar in a particular year ki the No. 1 pool. The mill peak system on which this formula is largely based has been the hard-core of the industry’s economy and stability for many years. On it have been based both production control and price determination. I have a very lively recollection of the many years of discussions and the various reports which contributed to the final development of the mill peak system.

Associated with the mill peak system has been the farm peak system. I claim that I was one of those who, from 1927 onwards, were responsible for a drive which eventually developed the mill peak system and the farm peak system. The mill peaks are determined from year to year by the State Government instrumentality, which is the Central Sugar Cane Prices Board. That system has a very close association with the British Empire sugar agreement, which allocates the export quantities of the various Commonwealth countries within the agreement and which determines prices.

The mill peak system has been recognized by succeeding governments, State and Federal, as an important factor, not only in price determination but in industry stability. Any variation such as that proposed in the majority recommendation would have a serious impact on the whole of the industry’s economy. For instance, if it had been adopted it would have required a considerable variation of both mill and farm peaks. It therefore would have very adversely affected the whole economy of the industry. It would very likely have reduced the volume of our exports, thereby affecting not only the sugar industry in Queensland but our general balance of trade. Possibly, it would also have led to an application by the industry for some increase in price. I emphasize that I know very well that the industry is not prepared to face up to any application for an increase in price at this juncture and in the present circumstances. It does not want an increase in price, and it has never applied for one unless it has been forced by circumstances to do so. For the reasons which I have outlined, the Government is to be applauded for the fact that it has retained this well-established and welltried system.

Let me make the point that the decision, in effect, to retain the retail price at lid. per lb. instead of reducing it to 10id. per lb. does not place any burden on the consumer, because the agreement under which the industry operates is not a one-sided agreement. Indeed, there have been many years when, under this system, the consumers in Australia have had cheaper sugar available to them than they would have had bad they been buying sugar on the world market, bringing it over here and refining it. And the industry has accepted that position quite readily. That position has applied not only to the actual consumers of sugar, but also to manufacturers who use sugar.

As a quick and reliable indication of the position between the sugar producer and the Australian consumer under this arrangement, let me point out one very interesting fact which I mentioned a month or so ago. It relates to the average minimum hourly wage rate for adult males and the minutes of work required to buy one pound of sugar. In 1915, when sugar was 3d. per lb., it took 12.4 minutes of work to buy one pound of sugar. In 1961, when sugar was lid. per lb., it took only 6 minutes of work at the prevailing hourly wage rate for adult males to buy a similar quantity of sugar. I cite that as an indication of the fact that this agreement under which the industry has prospered and developed has not operated at the expense of the consumer. It has not meant an increase in price to the consumer. Certainly the actual price of sugar has increased from 3d. to lid. per lb., but the capacity to buy has also increased very considerably.

Dealing with the recommendation for a variation in the formula, I point out that paragraph 21 of the majority report of the committee reads -

The Committee’s conclusions regarding tho domestic price of sugar -

That is what I have just been referring to - are based on a continuance of conditions that have existed in the past. Future prospects are clouded with uncertainties which cannot be evaluated at present, but which call for premonitory references- to certain things. The majority report then goes on to refer to the possibility of South Africa’s withdrawal from the British Commonwealth Sugar Agreement - which has now happened - increasing production of beet sugar in Europe, the present availability of parcels of refined beet sugar crystals produced in Europe at a price below the present low free market price for raw sugar, and consequences that might arise from the decision of the United Kingdom Government to seek admission to the European Economic Community. That followed just after the committee’s recommendation for an alteration of the formula, a recommendation which, if accepted, would mean a reduction of one half-penny in the price of sugar. I emphasize that the committee’s statement which I have just quoted points out that the conclusions of the committee regarding the domestic price of sugar are based on a continuance of conditions that existed at the time of making the report.

But those conditions have not continued. For instance, since the report was drafted, overseas market prices have fallen considerably as a result of the partial breakdown of the International Sugar Agreement, which is standing in abeyance at the moment, and various other factors operating in the sugar world, particularly in the Cuba area, which have resulted in a very material reduction in overseas market prices for some considerable time. It is quite true that in 1961 we were fortunate in being able to sell a parcel of 90,000 tons of sugar to the United States of America, a sale which meant an increase of 25s. a ton in the price of No. 1 pool sugar. But the industry now faces a different position from that which prevailed when the inquiry was made. In recent months there has been some slight increase in world market prices, but those prices have nowhere near come back to the level which we enjoyed a couple of years ago and, believe me, there is no assurance that the assistance we received from the United States of America will continue.

More than all that, it must be realized that the position of the industry is at least insecure, in view of possible Common Market developments. There is no immediate danger, of course, because, last year, the British Empire Sugar Agreement was extended for another year; but we cannot be certain as to what eventual developments will be. Therefore, the Government has said - and I think we all agree with it - that this is no time for altering the formula in an industry which, over the years, has achieved a high standard of efficiency, an industry which has led to the population and development of the northern areas of Queensland, which has accepted as its responsibility an assured supply to our home market, an industry which has given valuable assistance to another primary industry - the fruit-processing industry - and which is so essential to Queensland’s economy. For those reasons, I repeat that the Government is to be applauded for not accepting that recommendation relating to the formula and for retaining the retail price at lid. per lb. in capital cities.

Some reference was made by my friend, the honorable member for Franklin (Mr. Falkinder) to one aspect of the report.

Mr Falkinder:

– I was waiting for this.

Mr DAVIDSON:

– I knew the honorable member for Franklin would be. Whenever the sugar agreement has been before the House, I have usually spoken after the honorable member for Franklin, and, although we have not quarrelled, we have not been entirely in agreement on this question of support from the sugar industry to the fruit-processing industry. I fully appreciate the position of the honorable member for Franklin and I know the strong representations he has always made on this matter. Therefore, I am not joining issue with him at all on this particular point; I merely want to point out that the Sugar Enquiry Committee went into the question of the relationship existing between the sugar industry and the fruit-processing industry, as it was required to do, and, in its report, had this to say on that subject -

The relationship between the manufactured fruits industry and the sugar industry is good, the former realizing that the sugar industry has been very co-operative, and the latter admitting that a successful domestic fruit processing industry provides an outlet for sales of sugar.

The financial arrangements between the two industries are based on the system of export and domestic rebates, which is administered in a way that causes no particular problems.

The fruit industry would like the rebates to be higher- naturally - but, except in isolated cases, they made no request for an increase in either the export or domestic rebate.

The report goes on to say -

There is no fundamental reason why the sugar industry should be called upon to provide the stabilizing factor, in the form of a domestic rebate, to the processed fruits industry. Steps should be taken to relieve the sugar industry of this responsibility; the amount of domestic rebate should not be increased and the area of its operation should be reduced.

I want to make it quite plain to the House, particularly to my friend the honorable member for Franklin, that the sugar industry did not apply for any reduction in the rebate from its present level of £5 a ton. It has accepted the position as stated in those parts of the report which I have just read. It looks upon this as quite a fair arrangement between the two industries and, for some considerable time now has refrained from any attempt to have the rebate either reduced or abolished. Naturally the industry would not like the rebate to be increased very much because that would simply add to its costs of production and . lead to a consequent increase in price. I make the point that not only did the sugar industry not press for this, but, of greater importance to the honorable member for Franklin and others from Tasmania and the southern States, the Government did not accept and has not accepted the recommendation in the majority report that the area of operation of the domestic rebate should be reduced. Therefore, the position will remain as it has been.

Mr Falkinder:

– I just wanted to have that in black and white.

Mr DAVIDSON:

– My colleague, the Minister for Primary Industry (Mr. Adermann), who is the Minister in charge of this matter, will confirm my statement. It is very pleasing indeed to hear the support that this bill is receiving from both sides of the House. I believe this is a tribute not only to the Government for its realistic approach but also to the industry for its efficiency and the way in which on this occasion it has been able to put its case, as it always has when it has had to go before some tribunal for investigation. I applaud the bill and am pleased to support it.

Mr HANSEN:
Wide Bay

.- I, too, am pleased to support the bill. The agreement was originally made in 1915. Since then, the aim of the Queensland Government has been to keep stability in the industry for the benefit of the growers and those dependent on the industry. This is a fine example of organized marketing in a primary industry. The Queensland Government acquires the entire Queensland and New South Wales crops. The sugar industry has greatly assisted the fruit industry, as several honorable members have already mentioned. Because of the assistance given by the sugar industry, the manufacturers of fruit products have been able to compete on overseas markets with similar products using cheaper sugar obtained overseas. This has almost meant a guaranteed return to fruit-growers. The rebate does not apply where the fruit has been bought under a certain price.

The stability of the sugar industry and the return to growers, millers and workers in the industry are matters of great importance to Queensland and to Australia. For many years before Queensland entered into the agreement with the Commonwealth Government, the industry had suffered difficulties in the marketing of sugar. Returns to the growers were poor and wages for the workmen were low. Many experts at that time voiced the opinion that the industry could not prosper unless cheap native labour was used. To-day, sugar is Queensland’s main export crop. The industry is highly mechanized, both in the field and in the mills. Improved milling methods have resulted in the extraction of a greater quantity of sugar per ton of cane. Since the war, we have seen the advent of increased mechanical harvesting and the greater use of machines in the growing of sugar. Horses are now used on very few sugar farms. In the early days, sugar provided employment for many workers. That position is gradually being altered. Some plantations which in earlier years employed up to twenty men and a big team of horses now employ half a dozen men at the most. Most of the work is done by tractor and not a horse or a mule can be seen on the plantation.

Bulk handling both at the mill and at the port has reduced the cost to sugar producers. It is recognized that mills using bulk handling methods would have their operating costs reduced by 6s. a ton. To provide some equality in the handling costs, the mills that have the advantage of bulk handling pay a levy of 6s. per ton. This enables the mills which supply bagged sugar for export, mainly to Japan, to operate on a satisfactory basis. Improved methods and mechanization have applied not only in the mills but also in the field. Improved types of cane giving a greater yield of sugar have increased the return to the grower and also to the miller. Improved miling methods have been used. Australia is now recognized as the cheapest producer of sugar of all the countries using European labour. The Australian sugar industry can compete more than favorably with the sugar industries of countries using native labour. We have had numerous visits from representatives of such countries as India, Pakistan, Mauritius, South Africa, Fiji and Hawaii.

These countries are interested io improving their own methods and pay a tribute to our mills and to the research we have undertaken, particularly into the types of cane th:’ can be grown, the eradication of disease and the treatment of crops to induce a greater return per acre. Because of our improved methods, we are now producing more cane and more sugar per acre than has been produced before.

I am pleased to support the Government’s action in this instance. The suggestion was made that the honorable member for Griffith (Mr. Coutts) did not say whether he supported the Government’s action or accepted the committee’s report. I am sure the honorable member made himself quite clear and said that he supported the Government’s action in not reducing the price of sugar to the home consumer. I wish to make myself clear that I support the Government’s action.

The quantity of sugar that Australia can export is limited by the International Sugar Agreement to a total of 670,000 tons. The domestic home market is said to absorb 560,000 tons. On various occasions we have found further sales for our sugar. One such occasion was when relations between Cuba and the United States of America were broken and another occasion was when bad seasons in Mauritius reduced the amount of sugar that Mauritius was able to supply to the world market. Under the British Commonwealth sugar agreement, the United Kingdom has agreed to purchase annually from Australia 315,000 tons of sugar. This would be approximately half of our excess sugar. The report of the committee says that the price of sugar on the free market is £28 a ton. Since the report was prepared, the position has deteriorated considerably. At one stage, the price dropped to less than £19 a ton. It is pleasing to note that in recent months it has recovered slightly and is now £21 a ton. However, there is nothing to show that this rise in the price of sugar will continue or that the price of sugar will again reach £28 a ton. I do not wish to strike a note of pessimism, but we must look al the facts as they are to-day and not as they were when the committee made its report.

The industry itself is supporting quite a number of secondary industries in Queens land coastal towns. It is maintaining foundries which supply milling equipment. An export sale has been found for some of the equipment which has been developed in Queensland mills. A sale has been found for our milling equipment in South Africa and Mauritius, including some that was manufactured in my home town of Maryborough. The mills have also absorbed labour in the slack season and maintenance work in the foundries has kept employment at a reasonable level. Families along the coast of Queensland would be in a bad way indeed if it were not for the work provided by the sugar mills. By-products of the industry are being used increasingly - power alcohol in the manufacture of plastics, and there are three distilleries at present producing rum in Australia.

The honorable member for Richmond (Mr. Anthony) referred to Cuban sugar and the sale of sugar to Canada. I was interested to read recently a newspaper report that Canada was negotiating with Cuba for the purchase of sugar on the free market at £17.4 a ton. I wondered at the time whether our sales to Canada could not be stepped up, as we are all members of the Commonwealth of Nations and have some common interest, particularly if Great Britain joins the European Common Market. If Britain does join the European Economic Community, it behoves the members of the Commonwealth of Nations who are left outside to provide some sort of protection for their industries.

Cuba recently announced that the quantity of sugar it had undertaken to supply to Communist countries in 1962 would be reduced by about 500,000 tons. It also announced that it had completed its selling for 1962. The sale of Cuban sugar to the Communist countries has not been altogether advantageous to Cuba, because Cuba has not received a monetary return. It has to take some of its payment in goods, so the sale of its sugar to the Communists has not been of great advantage to the Cuban economy. Whether Cuba will again see fit to join the International Sugar Agreement is something for the future.

All things considered, I believe that if the committee of inquiry had made its investigations in the light of conditions as they are to-day, it would have made a different report. It would not have advocated a reduction in the retail price of sugar, as it has done. I feel, with other members of the Opposition, that it is in the interests of Australia, and particularly of the Queensland sugar industry and the State of Queensland, that the retail price of sugar should not be reduced. I believe that the committee’s recommendation on that point should be rejected and I have pleasure in supporting the Government on this issue.

Mr ADERMANN:
Minister for Primary Industry · Fisher · CP

– in reply - I wish to put the record straight on several matters that have been raised in this debate, but at the outset I want to say how pleased I am with the reception that this bill has been given by every member of the House, and particularly by those who have spoken on it. I want to assure the honorable member for Franklin (Mr. Falkinder) that the Government has no intention of doing anything but continue the sugar rebate. There will be no tapering off of the rebate, as was suggested in the majority report of the committee of inquiry. It did suggest that we start by applying its recommendation to the citrus industry, but we rejected that proposal and have continued the rebate as previously. One benefit to be derived from the rebate that is being paid to the fruit industry is that a greater market for sugar is created by the expansion of the domestic food trade. That gives additional help to the sugar industry.

The honorable member for Richmond (Mr. Anthony) - if I understood him correctly - said that the value of the annual, production of the sugar industry was £30,000,000. Of course, the value actually is much more than that. It is about £65,000,000. Our export sugar trade alone is worth more than £30,000,000 a year. So I wish to correct the honorable member’s statement.

Several members have referred to our contract “ for a year “ with the United Kingdom. Actually, our contract with the United Kingdom expires in 1969, so there is a period of grace there. The contract provides for the United Kingdom to take 300,000 tons a year, plus extras. Our commitment this year is for 313,500 tons. This is at a price considerably in excess of the world price. That is a stabilizing fac- tor in our export prices for sugar. I am sure that honorable members will be interested to know that, in addition to satisfactory sales of the 1961 crop, contracts for the 1962 crop, which we have not yet started to harvest, are quite satisfactory.

The honorable member for Wide Bay (Mr. Hansen) referred to Canada and Cuba. We have a contract already with Canada for it to take 100,000 tons of the 1962 crop. We have a contract with Japan up to date for 245,000 tons. We can say that we will have an excess delivery to the United Kingdom, over and above the 313,500 tons I have mentioned. We can say that we are sure of the sale there of approximately 340,000 tons. We have a contract with Hong Kong for 50,000 tons, with New Zealand for 80,000 tons and with South Korea for 10,000 tons. We have only 840,000 tons to sell on the export market. While the price may not be absolutely satisfactory on the free world market at present, we hope it will rise. Despite the International Sugar Agreement breaking down temporarily - and we hope it is only temporary - the prospects for sales are very satisfactory.

I think the main reason for the breakdown of the international agreement was the insistence of Cuba on a quota of 6,250,000 tons, which was far in excess of its rights. Now, by the irony of fate or otherwise, Cuba’s total crop does not look like exceeding 4,000,000 tons. So if Cuba had asked for a quota consistent with its production, we would have had a continuance of the International Sugar Agreement. I understand that the quotas are reviewed every two years. For two years - that is why I say that the breakdown is only temporary - we will not have an international arrangement, although Cuba previously always insisted upon and fought for an international arrangement.

The Postmaster-General (Mr. Davidson) said that the agreement was for six years, starting from 1st January. I tried to correct him at the time. Actually, the agreement started from 1st September of last year, and is for six years. We agreed with the Queensland Government, by letter, to continue the old agreement until the end of May. Rather than make it for four years and three months, I thought it better - and the Queensland Government agreed - that we should make it five years and three months as from now, or a total of six years from the date of the last agreement.

I want to make clear one of the principal reasons why we rejected the majority report of the Sugar Industry Committee of Inquiry. The committee recommended an alteration of a formula based on mill peaks. Mill peaks provide a total quantity which allows for domestic consumption and imports in the proportion of one to one and onethird. The committee suggested that the proportion should be one to one. I am sure all honorable members will agree with me when I say frankly that we would not alter the cost of production in an industry by altering a formula such as this. The costs remain, regardless of any alteration in such a formula. So the Government could not accept the theory that the producers should accept the added burden imposed by altering the formula in order to give to the consumers of Australia a concession of one halfpenny per lb. Things just do not work out like that.

As some honorable members have pointed out, international sugar prices have deteriorated. They have firmed a little recently, but prospects are not bright at present. However, I join with the honorable member for Wide Bay in the hope that the world price on the open market will firm. With the lessening of competition by Cuba, that is a possibility.

I appreciate the support given to this measure by the House.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Mr POLLARD:
Lalor

.- Mr. Temporary Chairman, I rise only to correct a misconception which I think ought to be corrected. The honorable member for Richmond (Mr. Anthony) made a statement about the beet-sugar industry that once existed in Victoria, and I am sure that he believed in the truth of that statement. If 1 interpreted the honorable member correctly, he said that the failure to expand the beet-sugar industry in Victoria was the result of a gentlemen’s agreement. That is quite incorrect. There never was a gentlemen’s agreement between the Queensland sugar industry and the Victorian Government, which ran the beet-sugar industry in Victoria. Over many years, I have found a great misconception about the facts. People have repeatedly told me that the beet-sugar industry in Victoria was held back and prevented from expanding by the Colonial Sugar Refining Company Limited. There is not a scintilla of truth in that suggestion.

The plain fact is that the beet-sugar industry in Victoria was established many years ago by a German firm. It collapsed under that firm’s management and was taken over by the State Government, which conducted it very efficiently for a number of years. After initial difficulties, the industry began to earn up to £50,000 per annum for the State Government in profits. Strangely enough, the production of beet sugar from each acre in Gippsland, which was the centre of the industry, was higher than the production from 1 acre of land in any other country. There was one sugar mill in Victoria, and the State Government licensed only the number of growers needed to provide an adequate quantity of beets for processing by that mill. The output of sugar was low - I forget the exact tonnage - but the product was of very high quality. It was sold entirely in Gippsland and mainly in the vicinity of the mill, which was situated at Maffra. That was all there was to the industry. It produced only about enough sugar to supply one district in Victoria.

The reason why the industry in that State was not expanded is plain common sense. It was realized that if the industry were expanded, the Queensland sugar industry might ask that the Victorian beet-sugar industry sell some of its sugar on the export market at a lower price. There was never a gentlemen’s agreement to limit the industry and the Colonial Sugar Refining Company Limited never placed any obstruction in its way. I have had to explain the situation over many years. I happen to know all about it, because, between 1929 and 1932, I was the Minister in the Victorian Government who administered the department which controlled the mill. The misconception about the beet-sugar industry in Victoria which has got abroad is a strange one. The mill eventually closed down, not because it was inefficient, but because the growers went over to the production of vegetables during the Second World War at the request of the Commonwealth Government. They found vegetable-growing more profitable than the growing of sugar beet. There was no beet for the mill to process and it closed. That is all there is to it.

I thank the committee and you, Mr. Chairman, for allowing me to clear up what I think is an intolerable misconception.

Bill agreed to.

Bill reported without amendment; report adopted.

Bill - by leave - read a third time.

Sitting suspended from 5.58 to 8 p.m.

page 1854

SULPHATE OF AMMONIA BOUNTY BILL 1962

Second Reading

Debate resumed from 11th April (vide page 1562), on motion by Mr. Adermann -

That the bill be now read a second time.

Mr POLLARD:
Lalor

.- The measure before the House is a proposal to provide for a bounty payment on the production of sulphate of ammonia in Australia. The payment is limited to £225,000 per annum. The Opposition proposes to support this measure. In outlining our rural policy during the last election campaign we said that if we were returned to govern this country we would provide for the payment of a bounty on the production of superphosphate, in order to stimulate agricultural production. We went further and said that we would pay a bounty for all other forms of artificial fertilizers. It can be said, therefore, that the Government has now taken a leaf from our policy, and we applaud the Government for doing so.

The production of sulphate of ammonia is of great importance to the people of Australia, particularly our agriculturalists. Anything that is of profound importance to Australian agriculturalists is naturally of profound importance to the whole Australian community. Australian soils are not very rich, from the agricultural point of view, and in connexion with the growing of certain essential agricultural products the supply of sulphate of ammonia and its fertilization qualities are of supreme importance. This is particularly so in the sugar industry of Queensland and northern New South Wales, and in the citrus-growing industry which is carried on in all parts of Australia, and even in the wheat-growing industry.

It is true, and perhaps unfortunate, that while in Europe there is as much sulphate of ammonia used as other fertilizers, in Australia, very largely because of the cost factor, the ratio of usage is 39 to 1 against sulphate of ammonia. We believe that tha last few years have demonstrated quite conclusively that the production of sulphate of ammonia within Australia is threatened by the cheaper production of this artificial fertilizer in other countries, despite the fact that we have in Australia the capacity to produce the whole of our internal requirements, which are now about 100,000 tons per annum.

The chief producers of sulphate of ammonia in Australia are the gas companies in the various States, which produce sulphate of ammonia as a by-product in the production of gas for lighting and heating purposes, the Broken Hill Proprietary Company Limited, which produces it again as a by-product of the production of steel and other such materials, and the Electrolytic Zinc Company of Australia Limited, which produces it as a by-product in the production of sulphuric acid, which in turn is a most important component of superphosphate, and is also essential to the production of many other goods, such as textiles and rubber products.

In September, 1960, in response to an application by the local producers of sulphate of ammonia for tariff protection or other forms of assistance, the Minister of the day forwarded a reference to the Australian Tariff Board asking whether assistance should be accorded the production in Australia of synthetic chemical compounds and mixtures containing nitrogen suitable for use, separately or in conjunction with other goods, as fertilizers, and, if so, the nature and extent of such assistance. The reference also asked if the board’s finding was for assistance through the customs tariff, and what rate of duty should be provided for under each of the columns in the schedule to the customs tariff in respect of the goods concerned. In pursuance of the Minister’s reference the board held the necessary inquiry and submitted its report. The report, which I have here, is most comprehensive.

In the interim between receipt of the reference and preparation of the report some tariff protection was given the industry. Now, however, the board suggests that rather than continue the tariff protection, essential assistance should be given by way of a bounty amounting to £225,000 per annum. Speaking for the Opposition, I can say that we favour the bounty rather than the tariff, because the cost of the bounty will be spread over the whole population, whereas the granting of tariff protection would mean that the extra burden would have to be borne only by the users of the particular product.

It is quite true that certain Australian industries in recent years, particularly since 1947, have embarked upon a most comprehensive programme of installation of plant and equipment for the production of sulphuric acid. I refer particularly to the Electrolytic Zinc Company of Australia Limited. In the production of sulphuric acid, which, as I have said, is essential to general manufacturing industry as well as to the production of superphosphate, very large expenditure has been incurred. In the case of the Electrolytic Zinc Company, I think the expenditure has amounted to about £3,000,000. It is inconceivable that, after not only this Government but also the previous government has encouraged the production of these commodities by this company, we should desert it now and allow its production of sulphate of ammonia and sulphuric acid to be endangered by the importation of cheaper goods from abroad.

It is rather ironical to recall that during the war the Commonwealth Government, because of the necessity to produce explosives, of which nitrogen is an essential component, found it necessary to establish, with the people’s money, at Ballarat, at Albion, at St. Mary’s and at Mulwala, plants, owned by the people of Australia, for the production of nitrogen from the air. Subsequently the Labour Government of the day with the cessation of hostilities decided that these plants, formerly used for destructive purposes, could, with a modest expenditure, be converted to the production of sulphate of ammonia rather than to the production of straight nitrogen. It converted these four plants, but in 1955, 1 think, the present Government disposed of them to private enterprise. I do not know what they are producing now, but the fact remains that the only sulphate of ammonia produced in Australia - and I will admit that it is adequate - comes from the gas companies, the electrolytic zinc factories and Broken Hill Proprietary Company Limited.

Mr Mackinnon:

– And the Imperial Chemical Industries Limited.

Mr POLLARD:

– And I.C.I, to some extent also. They are the people who took over the plants that we, as a government and as a people, paid for. It is true that we have produced a surplus of sulphate of ammonia over requirements, and I think that last year we exported about 48,000 tons of it. However, it is to be hoped that the use of sulphate of ammonia in Australia will increase as a result of this bounty and that where this fertilizer can be used in agriculture its use will be economically possible not only in the production of sugar and citrus crops but also in other agricultural products. Sulphate of ammonia is generally used in the production of potatoes, but I notice in the Tariff Board’s report an opinion from the Victorian Department of Agriculture that in certain circumstances the use of sulphate of ammonia in the production of wheat in the Woomera area of Victoria could be an economic proposition. I think that the honorable member for Wakefield (Mr. Kelly) will agree with me when I say that it would appear that in this country there might well be a stimulus to the use of such nitrogenous artificial fertilizers as sulphate of ammonia on a more generous scale than has so far obtained, with substantial advantage to agricultural production and the economy generally.

In those circumstances, expressing the unanimous opinion of the Opposition in this Parliament, and in accord with Labour Party policy, I support this bounty proposal. I stand wholeheartedly for it and I hope that the bounty will not be exploited by the people who will collect it. The bill contains a provision, of course, in regard to a limitation of profit to 10 per cent. Should profit exceed 10 per cent, the bounty ceases. I hope that the encouragement given by the bounty will be of such a nature as to stimulate greatly the use of sulphate of ammonia in its pure state as well as mixed with other forms of artificial fertilizer such as superphosphate. If this measure is successful in that aim I believe it will confer on the Australian people generally, notwithstanding their having to meet a bill for £225,000, a benefit which can be measured only in millions of pounds, and will substantially assist Australia to meet the disabilities which it is believed will stem from the United Kingdom’s entry into the European Common Market. I support the bill.

Mr KELLY:
Wakefield

.- I wish to speak briefly on some of the comments made by the honorable member for Lalor (Mr. Pollard). I have no quarrel with anything he said. I should like to say that it would have been unthinkable for the Government, in its determination to help the fertilizer industry, to impose a tariff on fertilizers. As things are, it is interesting to see that whereas we in Australia pay £32 10s. per ton for sulphate of ammonia the price in Great Britain is £26 5s. per ton with a subsidy of £11 16s. per ton, which brings the effective price down to about £15 10s. per ton. The producers in Britain are the people whom we have to sell against, and one of the things that impresses one overseas is the tremendous use of nitrogenous manures. This has been an agricultural revolution.

Many people have given to scientists the credit for the immense increase in rural production in the United States of America, but a great deal of the credit must go to the use of nitrogen in various forms, which the producers in America can get so much cheaper than we can. So it is only fair that if the Government is to assist this industry it should do so in this way. We are seeing a very large increase in the use of nitrogenous manures in cereal growing. To many of us who were brought up to think that only in the high rainfall areas could one afford to use nitrogenous manures this is strange. In the Murray mallee area, where we have a very great soil erosion as a result of sand drift, it is desperately important to get an early growth so that the plants can blanket the soil and prevent damage by wind. There is a growing increase in the use of nitrogenous manures in the 10-inch to 15-inch rainfall areas in order to get a quick growth to cover the soil. On our own property for many years we have conducted experiments in the use of nitrogenous manures, and I know that in a large and continually expanding area given over to cereal growing in South Australia we will be able in future to use such manures if - and only if - we get them more cheaply. For that reason I have very much pleasure in supporting the Government’s method of assistance to this industry.

Mr ANTHONY:
Richmond

– Like the previous two speakers, I support the measure strongly. It will make payable a bounty of £2 a ton on sulphate of ammonia produced in Australia. This is of particular importance to me, because in my electorate we use a considerable quantity of nitrogenous fertilizers in the production of sugar cane, bananas and vegetables. In more recent years it has also been used in the improvement of pastures for use in the production of milk and cream. Nitrogen is one of the major elements of plant life and it is probably the most deficient major element throughout the world. I believe that the future progress of agriculture in Australia will depend largely upon the availability of reasonably cheap nitrogen in this country. Therefore, the principle being laid down in the bill is very important. This principle is that the assistance to be given to the production of sulphate of ammonia in Australia will be by means of bounty rather than by way of a tariff on imports of that commodity.

I compliment the Tariff Board on its report because it gives much information about the cost of nitrogenous fertilizers throughout the world as well as consumption and other figures. The statistics given in the report show that the progressive countries where agriculture is leaping ahead have the highest consumption of nitrogenous fertilizers. One remarkable figure given shows that the quantity of such fertilizers used in the United States of America has increased seven-fold since 1939. The increase in the United Kingdom in the same time has been six-fold, but in Australia we have increased our use of nitrogenous fertilizers by only two and onehalf times since 1939.

Anybody who has visited the United States of America and taken an interest in American agriculture will know that the tremendous productivity per acre there has been largely brought about by the use of different kinds of nitrogenous fertilizer. In California one can see the result of the use of a fertilizer known as anhydrous ammonia, which is a nitrogenous byproduct of the petroleum industry. This is probably the cheapest source of synthetically made nitrogen in the world. In Australia, nitrogen is probably best obtained through the use of legumes, which have the ability to fix atmospheric nitrogen. But in some areas in Australia we have great difficulty in growing legumes. I refer particularly to the semi-tropical and tropical areas. In my own electorate we have had tremendous difficulty in establishing legumes which have the ability to fix atmospheric nitrogen. I believe that the problem in some difficult dairying areas will be overcome if we can get a relatively cheap source of nitrogen to stimulate grass growth. In most of these areas the major deficiency is of nitrogen. If we look at the figures of the world consumption of nitrogen, as shown in the report to which I have referred we see that back in 1900 only a very small quantity of nitrogenous fertilizer was used throughout the world. At that time the annual consumption amounted to 340,000 tons, but by 1938 it had increased to 2,700,000 tons. By 1959 it had gone up to 9,400,000 tons and if I am any judge consumption will continue to increase very rapidly.

The principles contained in this bill are very important. I do not believe sulphate of ammonia will continue to hold such a big place ici the consumption of nitrogenous fertilizer in this country. It has several disadvantages. The number of units of nitrogen in sulphate of ammonia is very much lower than in some of the more modern types of fertilizer such as urea, which has a little over twice as much nitrogen in the same weight of fertilizer. This is a big factor where transport is concerned.

We find also that sulphate of ammonia does not work very well in drill machines.

It does not drop down properly and tends to stick. Also, it has highly corrosive effects on equipment. Fertilizers such as urea do not have these disadvantages. One of the important features brought out in the report is the price of sulphate of ammonia. As mentioned by the honorable member for Wakefield (Mr. Kelly), the report shows that the Australian price was the highest of any of the countries listed, with the exception of New Zealand, where the price was only £1 higher. A high cost for this basic fertilizer in Australia immediately places Australian agricultural producers at a disadvantage with those of other countries, and this applies particularly to growers of some of our fruits, such as pineapples. Therefore, it should be our objective to get the cheapest possible fertilizer for the consumers in Australia. If an industry which invests a lot of money in plant to produce fertilizer it should be given some consideration and this bounty will give consideration to the Broken Hill Proprietary Company Limited, the Australian Gaslight Company, and the Electrolitic Zinc Company of Australia Limited for the money they have invested. But these companies engaged in the production of sulphate of ammonia have invested only £3,000,000. Perhaps I should not say “only”, because that is a lot of money, but the companies went forward and the lowest rate of duty they asked for was 7s. 6d. per unit of nitrogen per ton, which amounts to about £1,023,000 per annum for the protection of sulphate of ammonia in Australia. This is a tremendous penalty to impose on the primary producers of Australia, just to give these companies protection by means of a tariff.

When I examined this report I found it hard to see why the electrolitic zinc industry should be given such preferential consideration, because when the company established the sulphate of ammonia plant at Risdon in Tasmania it did so not for the benefit of the primary producers of Australia but for its own benefit; to use up its by-products. The company had excess hydrogen because it had to produce oxygen in the electro.litic process to help in the roasting of zinc. It also had a surplus of sulphur dioxide, which apparently is a by-product of this electrolitic process of coking zinc, and it had to get rid of that sulphur dioxide. To make sulphur dioxide into sulphuric acid is apparently the cheapest method of getting rid of it. So the company put up a sulphuric acid plant and, having that and the surplus hydrogen, it was a relatively simple process to make sulphate of ammonia. I repeat therefore that the company did not produce sulphate of ammonia to benefit the agricultural producers of Australia, but for its own benefit, so that it could use up the hydrogen which was a byproduct, and the sulphuric acid which was produced from sulphur dioxide. The company produces a great bulk of the sulphate of ammonia manufactured in Australia.

One of the outstanding features which one should notice in the report is the price factor. We find that the price of sulphate of ammonia slowly rose to £36 a ton in 1957. When local producers started to meet competition from other countries the price came down drastically by about £5, from £36 a ton to £31 a ton. When we eased import licensing the cost of sulphate of ammonia dropped from £31 to £24 10s. a ton, showing what a penalty import licensing imposed on the agricultural producers who need sulphate of ammonia. This drop in price might have been a little bit too severe for the producers of sulphate of ammonia in Australia and they immediately applied to the Government for emergency tariff protection. The Government gave an emergency tariff protection of 5s. per unit of nitrogen per ton, which increased the cost of nitrogen to primary producers in Australia by £3 a ton. But the significant factor is what import licensing was doing. Some of the people who complained about us putting a temporary duty on sulphate of ammonia also complained about the easing of import licensing. Here is a classic example of how prices were lowered by the abolition of import licensing. As I said earlier, this is vitally important to the sugar industry, the banana industry and many other industries. I know that many primary producers were concerned when they saw the temporary duty imposed because it meant an increase of £3 in the price, but now that we have changed the system and are going to give a bounty of £2 a ton, the cost of sulphate of ammonia will probably come down by £2 or £3 a ton. It was interesting to note how the cost of urea came down when we lifted import licensing. Urea was being landed in this country from Japan at £51 15s. a ton. When we eased import licensing the price of this fertilizer, which is not produced in Australia - that is an interesting point - dropped to £38 5s. a ton. That was the price of urea imported from Japan. Urea from Germany dropped from £82 10s. a ton to £64 10s. a ton. There is a tremendous amount of urea used in Australia and any tariff duty placed on it would bump up the costs of primary producers in Australia. There is a slight duty on sulphate of ammonia and urea from countries such as Japan, but urea coming from countries with British preferential treatment is admitted free. I support the bill because it will be of great benefit to those primary producers who use sulphate of ammonia.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 1858

INCOME TAX AND SOCIAL SERVICES CONTRIBUTION ASSESSMENT BILL 1962

Second Reading

Debate resumed from 12th April (vide page 1653), on motion by Mr. Harold Holt-

That the bill be now read a second time.

Mr SPEAKER (Hon Sir John McLeay:

– Is it the wish of the House to debate the subject-matters of the six measures together, as suggested by the Minister for Air?

Mr Crean:

– Mr. Speaker, I think that the matters contained in the other five bills are purely of a consequential kind, arising out of one point only in the Income Tax and Social Services Contribution Assessment Bill. I think that, having considered this bill we will offer no strenuous objection to the others. I would prefer the other five to be dealt with separately. They relate only to one very minor point. I think it would be better, as a matter of parliamentary business, to take this bill on its own and to leave the other five.

Mr SPEAKER:

– It is not a question of the bills, but only of the debate.

Mr Crean:

– I know.

Mr SPEAKER:

– Do you want to debate the Income Tax and Social Services Contribution Assessment Bill on its own?

Mr Crean:

– On its own.

Mr SPEAKER:

– Very well.

Mr CREAN:
Melbourne Ports

– Mr. Speaker, the Treasurer (Mr. Harold Holt), in introducing this bill, circulated a memorandum outlining its main purposes. There are only four main purposes, and 1 shall proceed to deal with the second, the third and the fourth before I deal with the first. We offer no objection to the second, third and fourth propositions, but we do offer objection to the first, which concerns the investment allowance. In the committee stage we propose to move that the clause giving effect to the investment allowance provision be deleted. The major part of my remarks will be devoted to the principle of the investment allowance.

The second of the four main purposes listed by the Treasurer is theextension for a further five-year period, from 1st July, 1962, of the special depreciation allowance of 20 per cent, per annum on plant and structural improvements used in primary industries. That allowance has been in force for some years, and in its current form it would expire with the returns which will be lodged for the year ended 30th June, 1962. The intention is to extend the operation of that allowance for a further period of five years. I do not want to go into the merits of this scheme, except to say that it has been in force for some years. It is running out and it is proposed to renew it. We offer no objection to the proposed renewal.

The third proposition is to permit, in specified circumstances, a taxation deduction for capital contributed directly to companies engaged principally in mining or prospecting in Australia or the Territory of Papua and New Guinea for minerals other than gold, uranium and oil. There are already special provisions applying to the mining of gold, uranium and oil. The purpose of the amendments suggested in clauses 4, 8 and 9 of the bill is to extend to other minerals the special taxation provisions and privileges that apply to gold, uranium and oil. In the name of consistency, we offer no objection to this proposal.

The fourth purpose is one which was referred to in the recent report of the committee on taxation. It was also taken up recently in the House by the honorable member for Fawkner (Mr. Howson). It relates to the sections of the existing act dealing with taxation clearances. For as long as there has been a federal income tax law in Australia, I think, there has been a provision that anybody who wants to leave the country cannot do so unless he first obtains a clearance from the taxation authorities. He could not get his steamer ticket or, latterly, his air ticket unless that clearance had first been obtained. The view of the committee, which apparently is shared by the Government is that the cost of the machinery required to enforce that provision outweigh any benefit that the revenue might derive from it. There is no fear that if this provision of the taxation legislation is annulled there will be no other means of collecting income tax from those who leave Australia. We see merit in this proposal.

Mr. Speaker, it is to the other matter that I wish to give some consideration on behalf of the Opposition. I refer to what is called the investment allowance, or, as it is described in the bill, an allowance additional to normal depreciation allowances. We believe that this imports into the income tax legislation a new principle and that certain aspects of it should be subjected to criticism. Traditionally, where plant other than buildings is employed in the course of earning assessable income, it has been the practice to allow, over the life of that plant, depreciation at rates determined by the Commissioner of Taxation. There have been one or two deviations from that principle. On occasions, what are called initial allowances have been allowed. The deductions for primary production which were referred to earlier fall into that category also to an extent. In the post-war period, initial allowances or accelerated rates of depreciation operated for some time.

Some three or four years ago, amounts additional to the amounts determined by the Commissioner of Taxation were allowed to be deducted in determining taxable incomes. If, for instance, a particular piece of plant were installed which had an estimated life of five years and the rate of depreciation determined by the Commissioner was 20 per cent, on such plant an additional amount of half the depreciation, or the equivalent of a further 10 per cent., would be allowed. That has been done in the past. Logically, I cannot see that, if you are going to permit depreciation allowances at all, it matters a great deal how quickly or how slowly you allow the depreciation to be written off and deducted from the income. In fact, under this proposal, certain mining ventures will have the right to write off the whole cost of plant in the year in which that it is installed. To me, it seems to be a matter of indifference, really, whether 100 per cent, depreciation is allowed in the year in which the plant is installed or whether the depreciation is averaged out at rates which are set by the Commissioner of Taxation. I accept the principle that if plant is employed in a business and is worn out in the course of earning the income of that business then the business venture should have the right to write off the cost of that plant before the assessable income is determined. Whether the cost is written off speedily or slowly seems to me not to matter a great deal at all.

But here we are introducing a new principle altogether because we are allowing as a deduction an amount over and above the capital cost of the plant installed. Of course, certain limitations are applied as to the kind of plant that may be written off in this way, and the proposal also contains an arbitrary provision relating to the date from which this concession shall apply. At the present time, if plant costing £10,000 is installed, then, according to the type of plant and according to the industry in which it is employed, the cost of that plant may be written off at a certain rate determined by the Commissioner of Taxation when arriving at the assessable income. Under this proposal, an arbitrary sum of 20 per cent, of the capital value of certain plant is to be allowed as a concession immediately provided the plant is installed after 7th February, 1962, and provided the plant is used for what are defined by the bill as manufacturing purposes. I point out to the House that clause 7 of the bill starts on page two and extends to page nine of the measure, and takes up all that space defining what is and what is not deemed to be manufacturing for the purposes of the proposed concession.

Let me now take up a little of the time of the House in pointing out just what this proposal really is. It is still linked to the depreciation provisions of the act. Indeed, clause 5 of the bill seeks to amend the general definition of “ depreciation “ so that the new proposed provision may be applied. We have no objection to writing off the historical cost of a particular piece of plant over its estimated life, or even in a shorter time than that if that is felt to be desirable, but I submit that to add something to that cost by way of a tax concession is in effect to subsidize certain industries which come within the definition of “ manufacturing “ provided that plant is installed within a certain period. The Treasurer (Mr. Harold Holt) did not deny that that was his purpose, for, in his second-reading speech, he said -

In proposing the allowance the Goverment aims to encourage greater investment in our manufacturing industries and thus ensure, both in the short-term and the long, a greater volume of both output and employment. It seeks also to promote greater efficiency in manufacturing production.

In essence, this bill is but part of the economic measures belatedly being taken by this Government as a result of the voting at the recent election. We say “ belatedly “ because the sort of situation which this and other cognate measures are aimed at remedying was actually in existence before the Government chose to recognize it. One of the injustices about this particular measure is that the people who are to be regarded as having some virtue so far as this provision is concerned are those who installed plant after 7th February, 1962. Those who installed plant between 1st July, 1961, and 7th February, 1962, are not to be rewarded for their virtue because they were so impudent as to instal that plant before the Government recognized that the seeds of a recession were germinating, even though the installation of that plant had the effects which the Government is now seeking to sponsor - an increase in investment and an improvement in the efficiency of manufacturing industry. If there is any virtue in introducing this investment allowance scheme at all, then I suggest that it ought to have application at least as from 1st July, 1961, and not from the purely arbitrary date of 7th February, 1962. But I merely mention that as a side argument.

What must be recognized is that, primarily, this proposed concession is not a taxation concession at all; it is merely another example of the straining of the provisions of the Income Tax Act to do something not directly related to income tax itself. We have had two other examples of that in recent times. First, we had the export incentive scheme under which certain firms are to be granted rebates of payroll tax according to how successful they are in improving their export trades. Another example of the way in which the provisions of the Income Tax Act have been strained is the measure which seeks to direct the investments of life insurance companies into particular channels. I am not quibbling about whether this sort of thing ought to be done; I am simply saying that if it is thought that certain industries require some encouragement to improve their export trade, if it is believed that life insurance companies ought to devote a certain part of their investable funds to public loans, or if it is felt that certain kinds of investment in particular manufacturing industries ought to be encouraged, then the Government ought to be honest enough to say that that is the purpose of the measure instead of attempting to shelter behind the provisions of the Income Tax Act.

If we are to put the matter in perspective, it is necessary that we examine some of the statistics that have been published recently. One set of statistics which has been mentioned already in connexion with another matter is contained in the taxation statistics published as a supplement to the 40th report of the Commissioner of Taxation, for the year ended 30th June, 1959; and even though that is two and one-half years ago, the figures do give some indication of the nature of the problem involved here. Those statistics disclose that in the year ended June, 1959, almost £260,000,000 worth of new plant was purchased by companies of all kinds. If those figures are dissected according to companies that are classified as manufacturing - the commissioner’s break-down gives a number of industries - it is found that of their total investment on new plant of £260,000,000, some £151,000,000 was in the field of manufacturing.

I would like to read the categories into which this investment found its way. Founding, engineering and metalworking accounted for £53,800,000; assembly and repair of ships, vehicles, parts and accessories, £9,900,000; textiles and fibrous materials not being dress materials, £8,600,000; clothing, knitted goods, boots and shoes, &c, £4,600,000; rubber goods and leatherware, £3,300,000; furniture and fittings, not metal, sawmilling and wood products, £4,900,000; paper and paper products, printing, bookbinding and. photography, £12,700,000; food1, drink and tobacco, £24,200,000; and all other manufactures, £29,500,000. Investment in new plant subject to depreciation in the year ended 30th June, 1959, totalled £151,500,000. The principal categories were founding, engineering and metalworking, £53,800,000; food, drink and tobacco, £24,200,000; and all other manufactures, £29,500,000.

Of the total investment in all companies in the year ended 30th June, 1959, £151,000,000 out of £260,000,000, or something in the region of 60 per cent., was in the field of manufacturing. With very few exceptions, but with a few other inclusions, that is the field to which this new investment allowance will apply as from 7th February, 1962.

The other interesting feature that must be taken into account - these figures are contained in the report of the Commissioner of Taxation at page 122 and subsequent pages - is the taxable income of companies. The Commissioner gives the taxable incomes of all companies, private and nonprivate, in the Australian community. For the year ended 30th June, 1959, approximately 41,000 companies had taxable incomes of £763,000,000 and paid total income tax of £225,500,000. Of the 41,000, 808 had taxable incomes exceeding £50,000 and in some instances exceeding £1,000,000. Between them, the 808 companies derived taxable incomes of £255,800,000. More than one-third of all profits were earned by 800 out of 41,000 companies, and they paid something like one-third of all the tax paid.

If a flat concession such as this is to be applied, the greatest benefit will be given to the largest economic entities in the community. I think when a Parliament is legislating along these lines, it ought to know what it is doing. The Attorney-General (Sir Garfield Barwick) claims that he is perplexed about the growth of monopoly and restrictive trade practices in the community. One of the effects of this sort of’ measure can only be to give the greatest advantage to those concerns which qualify in general terms as monopolies and some of which follow restrictive trade practices. At the same time as the Attorney-General, as the legal guardian of the structure of the Commonwealth, is seeking to abate economic strength, the Treasurer is taking measures that work in the opposite direction. I suggest that should at least be noted by the House.

We have had an example recently in this House of a series of measures being passed which have affected the motor vehicle industry. When the restrictive measures were imposed, the reason given was, in the words of the Treasurer, that the motor vehicle industry relatively was growing faster than he thought desirable for the economy as a whole. Admittedly, he changed his mind some six or eight months later, because he found that the motor vehicle industry was so intimately intertwined with the economic fabric of the nation that, once it was dislocated, the whole economic tempo was affected. I would point out that one of the principal beneficiaries of this measure will be the motor vehicle industry if it should engage in further expansion of its plants. We have asked before, and I ask again: Where in the future will the Treasurer call a halt as far as the level of activity in the motor vehicle industry itself is concerned? He called it before when production was at a level of 330,000 vehicles a year, although at that date the industry had sufficient capacity to produce 375,000 vehicles a year. A purpose of the measure would be to build the capacity of the industry to even more than 375,000 vehicles a year.

One of the interesting features of changes in this country and in other parts of the world is that “ economic planning “ is no longer the dirty term that it was in some quarters a few years ago. It is reckoned nowadays that it is just as sensible to plan the economic life of the nation as it is to plan the economic life of any small business in the community. We on this side of the House applaud that principle. But, if we are to have economic planning, what virtue is there in applying a measure which will bestow the same sort of benefit on the motor vehicle industry or the expansion of a brewery as it will bestow on expansion in, say, the steel industry, which may be more necessary for the welfare of the nation? The memorandum which was circulated to honorable members shows that the measure is intended to apply to such manufacturing aids as vats for increasing the production of beer in the Australian community. I am not one who at this stage would argue as to whether the brewery industry in Australia ought to be encouraged, but I would certainly go on record as saying that it would not stand very high in my scheme of priorities, as I see the needs of the nation at the moment. The Treasurer may be very right to encourage greater investment in our manufacturing industries. But I would suggest that he should be a little more selective and say that some industries should be encouraged more than others. The blunt application of a measure such as this will give the same sort of benefit to a brewery as to the aircraft-building or ship-building industries, for example.

We say that this measure is unselective as to where it falls and is arbitrary as to the date of its application. It highlights again the deficiencies in the economic planning of this nation as it is being handled by the Government to-day. It is undoubted that capital investment should be encouraged, but it is worthy of recognition that most people examining now the consequences of the credit squeeze which the Government applied some twelve or eighteen months ago have come to the conclusion that the things that were most affected by the credit squeeze were not the things that were going on at the time or had already been planned. The things that were discouraged were future capital projects.

On that occasion, the Government did not seem to be so eager about encouraging investment, but now it is using for that purpose, rather unselectively, the powers that reside in it under the income tax legislation. We on this side of the House say that this sort of thing should not be done in this way. If the Government wants to pay a subsidy to certain kinds of industry, I suggest that it name the industries it believes should be encouraged. This investment allowance is nothing but a rather offhanded kind of subsidy, without very much logic about it.

Perhaps the Minister for Air (Mr. Bury), who assists the Treasurer (Mr. Harold Holt), will indicate why the purely arbitrary rate of 20 per cent, has been chosen for the investment allowance, ls it because that rate is similar to the 20 per cent, special depreciation allowance that has already been allowed to primary producers? I point out, as a matter of mathematics, than in the first year the same result would be achieved if the Government gave an initial allowance straight out, on the basis of historical cost, as it is doing with the farming community. The fact is that secondary industry has been chosen for favoured treatment - for treatment that has never been given in the taxation history of Australia previously. It is getting a bonus over and above the capital cost of a transaction.

One of the strange things that the Australian Country Party might have a look at is this: If a firm should qualify under the 20 per cent, agricultural provision, even though it happens to be in the field of manufacturing it does not get the additional bonus given to other manufacturers but gets the lesser benefit bestowed on primary producers. I suggest that the honorable member for Mallee (Mr. Turnbull) ponder a little about that. If one of his constituents on a farm goes in for some form of capital development which costs, let us say, £1,000, he can claim £200 each year over five years. But if the man alongside him has a factory, not for agricultural purposes but for industrial purposes, and spends £1,000, he can claim £200 immediately over and above the capital cost of his piece of plant and can hen claim the normal depreciation on the £1,000 over the life of the plant. What is the reason for the more favoured treatment of one? Then there is the anomaly of the case that falls within both categories. A piece of plant regarded as useful for agriculture but also for manufacturing purposes does not get the greater of the benefits, but only the lesser. I suggest that members of the Country Party ask the Minister at the table why that has been done.

I shall recapitulate by pointing out again what this investment allowance is. It is something different from anything that has previously been applied in the history of Australia. It is an allowance over and above the historical cost of the piece of plant. The honorable member for Swan (Mr. Cleaver) who, I understand, will follow me in this debate, knows as an accountant that for a good many years argument has been going on in accounting journals as to whether depreciation should be on the basis of what I call historical cost or on the basis of what some people like to call replacement cost. So far, in most countries, the argument has been settled in favour of the historical cost as the basis for depreciation allowances.

This particular measure is departing from that principle so far as a favoured section of the people of Australia is concerned. It is arbitrary as to amount. Why is the rate 20 per cent.? Would it not have been a greater encouragement to have given 50 per cent, instead of 20 per cent.? In essence, the economics of it are that if a company has a piece of plant that costs £1,000, it is allowed an investment allowance of £200 on that plant. If the rate of tax that the company is paying is 8s. in the £1, it is equivalent to giving it a taxation rebate in one year of £80, or 8 per cent, of the capital cost of the plant. As I see it, that is all this investment allowance is. A specialized subsidy will be paid under the subterfuge that it is an income tax deduction.

It is straining the purposes of the income tax law to do this. If the Government feels that certain sorts of industry need encouragement, the appropriate action is open to it. In Australia at present, with about 100,000 persons unemployed, and with manufacturing industries still the biggest single source of employment, those industries do require stimulus of a kind. But the Opposition says that the Government should stimulate quickly the industry which is a provider of employment rather than the industry which denies employment. That is one of the strange contradictions of this measure. What are called capital intensive industries, or industries that are replacing man-power with machines, are the industries that will get the biggest benefit from this measure.

I think this is a fitting time to say that the Labour movement has no objection to the installation of machines that replace man-power, provided that something is done to look after the men who are displaced. Here, perhaps it is salutary to note that in other comparable countries such as Canada and the United States of America where problems of this kind exist governments are giving at least as much attention to the provision of special training schemes for those people who are displaced from employment by mechanization as this Government wants to give to those who install the machinery. For instance, in a bulletin from the United States which was issued to honorable members the other day, 1 read that the United States Government had set aside about £100,000,000 Australian, or some 200,000,000 dollars annually to re-train workers who proved to be redundant in the industry in which they were engaged. An equivalent amount, relative to the Australian population, I suggest, would be about £7,000,000 or £8,000,000 Australian a year. The only stimulus that this Government gives to industry is to install more machines, thereby displacing more workers. This Government does nothing whatever about the people who are displaced.

I suggest that this circumstance shows that the Government limits its vision in these matters with blinkers. There is need to stimulate industry in Australia, and a little attention should be given to the question of which industries will give us the most return from stimulation. For example, the Government recently had to restrain the motor industry. When it wanted to expand that industry again, it should have considered how far it wanted the industry to expand. The Government should have realized that if that industry expanded too fast it would use so much steel internally that Australia would have to import steel, with adverse effects on the balance of payments. The Government should have considered whether it would not have been more logical to devote more of this kind of assistance to a specific attempt to build up the steel industry rather than indiscriminately expand the motor industry, and perhaps the activities of the breweries as well. The honorable member for Swan may tell us whether he thinks the Swan brewery in his area requires the sort of stimulus that this bill will give. I am not arguing about the virtues of the products of the brewing industry compared with the products of any other industry. I say only, as I stated earlier, that, in my book, the brewing industry would not have a very high priority. I do not think it would matter much if we froze our consumption of the products of that industry at a particular level if, by so doing, we could devote additional resources to some other form of undertaking which would be more useful socially.

It would be more timely if the Government were selective in this matter. It was right in recognizing that the motor industry needed a stimulus, but it was wrong in not trying to determine which industries should be stimulated in preference to others and in relying on indirect rather than direct methods to provide the stimulus. The Government, by its methods, may do some good, but it may also do some harm which could have been avoided by a little more selectivity - by a little more definite economic planning. More economic planning is needed in this country. There may be arguments about what the machinery of that planning ought to be. We may argue about whether that planning ought to be put into effect by the Treasury, by the Prime Minister’s Department or by some agency distinct from either of those arms of government. At least, in 1962, in view of the problems that beset Australia externally and internally, more attention should be given to this aspect of the problem. No doubt we shall hear to-morrow evening what one Minister thinks about the threat by the European Common Market to our trade.

At this stage it ought to be dawning even on this Government that not everything is right in the Australian economy and that what is wrong is in great measure due to the inadequate way in which the Government approaches our problems. Instead of grappling with them as they emerge, it tries to imagine that they do not exist. When it does act after the problems have emerged, it adopts the wrong remedies. I suggest, Mr. Deputy Speaker, that although the Government, by introducing this measure, recognizes that a problem exists and that there is need for greater investment and for greater efficiency in manufacturing, it has used a blunt instrument instead of a sharp one. As I have intimated, we propose to vote at the committee stage against clause 7, which will introduce this interesting new phenomenon -the investment allowance. This kind of allowance is something new in tax history in Australia, and its purpose could have been better achieved by other methods.

Mr CLEAVER:
Swan

.- Mr. Deputy Speaker, the honorable member for Melbourne Ports (Mr. Crean) certainly set himself a very difficult task when he set out to express strong opposition to the investment allowance. I am sure that those who have heard him remain unconvinced that there is any sound basis for his opposition. I shall return later to this allowance, Which is the major aspect of the bill. Perhaps I can then rise to the occasion and answer some of the points raised by the honorable member.

Let me say that there are four principal provisions in this bill, which I enthusiastically support, because all its provisions are extremely well conceived. First, we have the provision for repeal of the income tax law relating to the issue of tax clearance certificates to persons about to leave Australia. Secondly, we have the provision to permit as a deduction capital contributed directly to companies engaged principally in mining or prospecting in Australia or the Territory of Papua and New Guinea for minerals other than gold, uranium or oil, those already being provided for in the principal act. Thirdly, we have the provision for the extension for a further five years of the special depreciation allowance of 20 per cent. per annum of the cost of plant and structural improvements in primary industries. That provision, of course, is very dear to the hearts of my colleagues of the Australian Country Party, and I propose to come back to it, also, at a later stage. Fourthly, we have the provision which introduces for the very first time in the tax laws of Australia an investment allowance of 20 per cent. of capital expenditure on new manufacturing plant used in this country.

As I have said, Mr. Deputy Speaker, I wish primarily to discuss the investment allowance, as did the honorable member for Melbourne Ports. But let me, by the process of elimination, first dispose of the other provisions which I have mentioned. What do we really think about this proposal relative to tax clearance certificates? I suggest that the elimination of these certificates will rid Australia of an administrative procedure that can rightly be described as time-absorbing and wasteful. That procedure has been with us a long time. Its elimination will mean a lot to the airline and shipping companies because they will be relieved of certain obligations which are now laid upon them. The Commonwealth Committee on Taxation, which is often known as the Ligertwood committee, was appointed some eighteen months ago and we were presented with its report last year. Dealing with this matter, the committee, in its report, stated -

Reasons in support of the complete abolition of the system may be summarized as under: -

The present inconvenience caused both to visitors and residents.

The difficulty of identifying those cases where requirements should be relaxed from those where they should be retained.

The consensus of world opinion as shown in the International Civil Aviation Convention that such restrictions should be removed.

The existence of Double Tax Agreements with the English speaking countries,

The expected future growth of the tourist industry.

Those were only some of the reasons that were set out by the committee. It is also interesting to note that this committee said that in its view the retention of the system was not justified, and that any loss of revenue would be offset, at least in part, by the saving of approximately £80,000 a year in administrative costs.

This provision is merely another indication of how our country is reaching maturity. Our system has been freely criticized not only by our own people but also by visitors to Australia. I would say that this measure is certainly overdue, and it is a good thing that it now is being introduced as one of the four main provisions of the bill before the House.

The remaining three provisions that I have mentioned are all designed for a laudable purpose. Here 1 join with the honorable member for Melbourne Ports, because the honorable member related most of these provisions - certainly the one referring to the investment allowance - to the announcement by the Prime Minister (Mr. Menzies) on 1st March last that certain steps would be taken to stimulate the Australian economy. These three provisions will obviously have that effect. It was for that reason that they were designed. They were designed certainly to stimulate the essential development which remains the constant objective of this Government. The Government has said again and again that its primary objective is the overall development of this young nation which has such a good reputation in other parts of the world, and which has made some fantastic achievements in recent years under the present Government. This Government will not depart from the developmental objective.

Mr Reynolds:

– Who are you kidding?

Mr CLEAVER:

– You will always take some kidding on this, but the Government happens to follow the kind of positive programme that your party entirely lacks.

Let me move to the next provision, which is that other minerals will now attract investment capital. A similar deduction will be allowed as has been allowed in the cas. of gold, uranium and oil. In the helpful explanatory memorandum issued by the Treasurer (Mr. Harold Holt), our attention is directed, on page 17, to the definition of prescribed minerals. It will mean minerals other than gold, uranium and oil. As has already been mentioned, our income tax law includes stability provisions with relation to mining for gold, uranium and petroleum. Now we have this new provision relating to other minerals. Has not this Government said again and again that it will promote the development of minerals? Is it not true that our own Department of National Development has in recent years unearthed in far distant places in Australia very valuable deposits indeed of minerals, the production of which will now receive the incentive which has been available for some years past in the case of the production of gold, uranium and oil?

Then we come to the provision that has been made in the interests of primary industry. I have said that my colleagues of the Australian Country Party should be extremely pleased to see this provision enacted again for a five-year period. Let me say that one could hardly imagine this provision not being re-enacted under prevailing conditions. We have said time and time again that the primary industries of Australia are of vital importance, and that while manufacturing industry has developed along the lines I have mentioned, and developed quite fantastically, we are largely dependent, and may remain for a long time largely dependent, upon our primary industries. Here is a provision which has been in the income tax law for some considerable time. Am I not right in saying that it has proved itself over the years to be extremely helpful to primary producers?

Mr Leslie:

– And to the economy of the country generally.

Mr CLEAVER:

– Agreed - that is accepted. It aids the primary producer by enabling him to replace his equipment with up-to-date machinery. It helps him to provide modern housing for his employees. His capital expenditure under this provision during the next five-year period may be written off over a period of five years. The primary producer will get the benefit of this special depreciation of 20 per cent, per annum.

Now we come to the new investment allowance, the fourth major provision. I refer again to my friend, the honorable member for Melbourne Ports, who talked of the custom of taking the precise cost for depreciation. He raises his objection on behalf of his party because this allowance is, of course, over and above the normal depreciation. He referred to the fact that it can be classified as a subsidy only for those who are fortunate enough to take advantage of it. He suggests to the House that these are the favoured few, the monopolies, the larger companies. I will come back and deal with that suggestion later. He raises a point about the date, 7th February, from which the investment allowance will apply. I want to say, on that point, that any date must become an arbitrary date, and any amount an arbitrary figure. 1 say in all sincerity that the opposition to the investment allowance is, in my view, and, I am sure, in the view of anybody else who has a thought on the subject, nothing more than an expression of sour grapes on the part of the Opposition. The honorable member for Melbourne Ports wants to make fish of one company and fowl of another. He tries to draw my ire by referring to certain companies which perhaps need no incentive, but he well knows that unless you use, as this Government has had to use, the device of sales tax, there is no provision for partial taxation. He knows full well that you must deal with a device of this kind, which is concerned with depreciation, in a general way across the whole of industry. Let me say that it is a sound and successful method of providing an incentive to manufacturing industry which in this country needs to be expanded to an even greater extent than it has expanded previously.

Mr Coutts:

– You are pulling your own leg.

Mr CLEAVER:

– I am not pulling my own leg. I tell the honorable member and other members of this House that the United Kingdom Government and the Government of the United States of America have also used this very method of investment allowance successfully.

Let me go further on this point, because the honorable member for Melbourne Ports is not the only one who has spoken along such lines. Is it not a fact that the Prime Minister took to task the Leader of the Opposition (Mr. Calwell) on 1st March? Well do I remember it, because I applauded the right honorable gentleman in this House at that time. The Prime Minister said -

Then we turn to the investment allowance. I hope that the manufacturers of Australia were paying proper attention to what he (the Leader of the Opposition) said last Tuesday, because he rejects the investment allowance. On what grounds? Because it is a hand-out - his very words - to the large manufacturers whose employees apparently do not matter. This is a hand-out to the large manufacturers. An investment allowance, a novelty in Australia designed to enable manufacturers to re-equip themselves on modern lines and thereby keep down their unit costs and go into the competitive world. This is thrown out. It is just a hand-out to the large manufacturers.

How important it was that the Prime Minister should sheet that home to the Leader of the Opposition, who was caught out with a very foolish criticism of a measure which may provide, as I am sure it will, a wonderful impetus and incentive to the manufacturing industries of this country.

It is important to note the public reaction - not just the gratification of the Government at having brought in the measure, but the reaction of people in industry in this country. The “ Taxpayers Bulletin “, which expresses the opinions of a great number of manufacturers and industrialists who are members of the various taxpayers’ organizations, says in its issue of 31st March -

It is already clear that this concession will bring benefits to a number of industries in which expansion plans have been announced. Notable amongst these is the iron and steel industry, which is committed to large annual expenditures. Probably of greater importance is the encouragement this allowance will give to companies contemplating expansion and to a number of others that have deferred expansion plans.

It also states -

Quite clearly this measure is a key weapon in the Government’s attack on recent industrial stagnation and unemployment.

I refer again with pleasure to what the Victorian Chamber of Manufactures feels about this investment allowance. In its recently issued magazine, “Industry Today”, which honorable members have received only lately it says -

The 20 per cent, investment allowance for manufacturing plant announced by the Prime Minister as an incentive to industry has created wide interest in industrial circles.

Now let me deal with what the allowance is and what it is not. First, it has nothing to do with depreciation; secondly, it may be contrasted with the initial depreciation allowances introduced some years ago. The honorable member for Melbourne Ports (Mr. Crean) made reference to this, and here I think we can go a little further and show the contrast. The initial depreciation allowance, the provision for which was repealed some years ago, stood at 20 per cent, for a period and for another period stood at an optional 40 per cent. It amounted, in effect, to an extra depreciation claim in the year of purchase which, of course, was necessarily followed by a reduced claim in subsequent years. It gave nothing away, but merely crammed a higher amount of claim for depreciation into the initial period of ownership of the plant. In other words, it represented a deferment of tax.

Thirdly, this new allowance is a tax saving in the first year of use. It will provide a real incentive for investment in new producing plant. We know that depreciation is applied to such plant and equipment in the ordinary way. That will not be interrupted. As I said, the new allowance has nothing to do with depreciation. The scheme for depreciation allowances will flow on, but, as an incentive in this first year of purchase, the investment allowance will apply.

Mr DUTHIE:
WILMOT, TASMANIA · ALP

– It will operate for only four months in one year.

Mr CLEAVER:

– You do not know how long it will operate, so do not be so smart. In effect, the new allowance will mean that, based on present company tax rates, 8 per cent, of the cost of eligible plant will be covered by a reduced tax liability. But this does not affect, as the honorable member for Melbourne Ports seemed to imply again and again, the large companies and large industrial concerns only. It is not something of advantage to the public company only. Mark this, that the private company which may find it necessary to pay tax on undistributed income would receive an even greater benefit than that which I have just mentioned based on public company tax rates. Australia’s very large undertakings will be encouraged, I believe, to step up their developmental plans, and thousands of smaller industrial concerns will likewise take up expansion schemes, many of which were temporarily deferred. In my own electorate there are vast developing industrial areas, some of which have new industries which are unique in Australia. I am thinking particularly of one plastics industry which I have not encountered elsewhere in Australia. I can assure honorable members that there are many small industrial concerns which deferred their expansion plans but which will now go ahead with them. Under the administration of this Government in recent months and the measures it adopted, as we well know because of a situation which was only temporary, these companies have decided to undertake the expansion plans which they had deferred. As a result, employment opportunities will multiply as the investment allowance takes effect.

I should like to deal now with some of the queries that will be raised, because when a new device like this is introduced there will always be queries. The taxation officers no doubt will have many hundreds of problems put to them for solution. First, I should like to ask again the question asked by the honorable member who preceded me in the debate: Why the date, 7th February, 1962, as the date from which the allowance is to take effect? Why not an accounting date such as 30th June, 1961, or 31st December, 1961? The Federal Taxpayers’ Association sent me a wire saying in effect that a date during the progress of the financial year presents practical difficulties to industry. I said earlier in my speech that any date chosen would be arbitrary. Any date represents a cut-off point. Some people will reap the benefit of this allowance and some will be denied it; and whether the date chosen is 7th February last or an accounting date such as I have mentioned, the Government’s decision is sound. It has decided that the date on which the public was given notice of the Government’s intention in regard to this allowance would be the date from which the allowance would apply-

There may be some inconsistency existing, according to the explanatory memorandum, regarding the actual delivery and placing of orders for manufacturing plant. On page 12 of the memorandum issued by the Treasurer (Mr. Harold Holt) we find what seems to be an emphasis on the actual delivery date of plant. This is to be found in paragraph (a) at the top of that page. The emphasis here is on the receipt of plant after 7th February. Delivery or receipt, therefore, appears to be the principle on this particular point. But in paragraph (c) on the same page we find what is probably a departure from this principle. That paragraph says that in relation to a contract entered into before 7th February, notwithstanding non-delivery, the allowance would not be available. I have a case from my own electorate where a dairy firm, knowing that special equipment not available in this country had to be obtained by it overseas, and knowing also that its manufacture would take a considerable time, lodged its order months before it expected the equipment to come to hand. That order was placed before 7th February, and the company will take delivery of the equipment in October next. This equipment is definitely not manufactured in Australia. The company says that, in order to fit in with the production-line schedule of the English manufacturers, it was necessary for the order to be lodged early. That seems to me a case in which the allowance should be available, provided delivery of the equipment is taken after the date set down - in this case 7th February, 1962. So I suggest that the point about delivery which was emphasized by the Treasurer in his secondreading speech should be considered, and that any inconsistency along the lines that I have mentioned in paragraph (c) of the explanatory memorandum might be reconciled.

I want to refer particularly to large storage tanks and fittings for liquid petroleum gas. Here again is a particular point of interest, because I have in mind that these tanks are specially designed for manufacturers’ equipment, but in many cases they remain the property of the gas company. But the gas company could not take them back and re-issue them, since they were designed specifically for equipment which will qualify for the allowance because it is to be purchased after 7th February for manufacturing purposes. I believe that these containers should be approved for the investment allowance. This is an item that needs a ruling -as qualifying equipment because it seems incomplete without the tank valves and fittings which go with it. I believe that other honorable members, if they have not already received representations on the subject of dies, will do so, for the legislation provides specifically that dies will not attract the investment allowance. Perhaps attention could be given also to equipment used by the person known as the “end assembler” - the one who finally assembles equipment which has been manufactured elsewhere in a factory, where all the investment in new plant has attracted this investment allowance.

Another query is: Does the lessor of manufacturing equipment qualify for the investment allowance? It has been brought to my attention that sub-section (2) of section 62aa seems to cover the lessor. On page 6 of the memorandum accompanying the bill we read -

Sub-section (2.) designates types of plant to which the deduction is primarily applicable. Stated in very broad terms, sub-section (2.) will enable the special 20 per cent, deduction to be available in relation to plant owned by the taxpayer and for use primarily, principally and directly in manufacturing processes, whether the processes are carried out by the taxpayer on his own behalf or on behalf of another taxpayer. The provisions of sub-section (2.) are, however, subject to certain exclusions specified in subsection (3.)

I hope that the Treasurer (Mr. Harold Holt) will later answer these queries for us. I think this item might be of benefit even to the lessor of manufacturing equipment. I heartily support the bill. I see no difficulty in having this matter dealt with through income tax legislation. I wonder where else we could give an incentive like this! It is linked with taxation as a deduction from the assessible income. I therefore commend the Government for its initiative in this field. I believe this will be the incentive that manufacturing industry in Australia desperately needs.

Mr CAIRNS:
Yarra

.- I would have been much more impressed by the praise for the Government from the honorable member for Swan (Mr. Cleaver) if I had ever heard him do anything else but utter fulsome and fulgent praise for everything that the Government does. I think the honorable member for Swan outdoes every other member on the government side of the House in praising the Government of which he is a supporter. If I had ever heard him utter one word of criticism of the Government I would have been more impressed by his unqualified praise for it on this occasion.

When some members of this House discuss economic trends and conditions in Australia to-day they very often refer to the recession or depression of the last two years as a temporary situation, as though feeling, now that recovery has occurred, that we can afford to forget about that, situation. The fact is that this recession or depression, which government supporters, full of praise for the Government, want us to think of as merely a temporary situation, has probably cost the Australian people £400,000,000 in the last two years. It has probably cost a level of unemployment of something like 150,000 pople more than was necessary, and has probably meant unused capacity to the extent of £250,000,000 or £300,000,000. That is the cost of the temporary situation, recovery from which is so generally lauded by the honorable member for Swan.

The measures before the House deal with a number of matters, but only one proposal is being opposed by the Opposition and I want to spend my time dealing with that proposal. I refer, of course, to the provision relating to income tax, deductions for investments by manufacturers This amendment will benefit manufacturers through a special deduction for investment in manufacturing plant. As has been pointed out by the honorable member for Melbourne Ports (Mr. Crean), the Government proposes in this bill to use taxation for a purpose other than to raise revenue. It is the third of the departures which the Government has made in the last twelve months. It is a wonder to me that the purists on the other side of the House and the free enterprise people in industry have not considered some constitutional challenge to this legislation. I can well understand some of the more laisser-faire theorists outside describing the Government as socialist for this kind of measure.

It is interesting and significant that in its attempt to overcome the economic difficulties of recent times the Government has been forced to use the instrument of taxation for some social purpose - for something other than to collect revenue. It is interesting that some of the theoretical purists have not sought to challenge this proposal and it is interesting, too, that some private enterprise profiteers have not considered going to the High Court on a constitutional question. The benefit that is provided in this bill, as pointed out by the honorable member for Melbourne Ports, amounts to about 8 per cent, on the kind of investment that is covered by the bill. In other words, about 8 per cent, of the investment covered - by the bill will be in effect a subsidy from the Government. Under these circumstances about 8 per cent, of a. manufacturer’s investment will be paid for by taxation concessions or, in effect, by other taxpayers. We must concern ourselves with trying to decide how effective this measure can be, firstly treating it as an aggregate or total measure. In his second-reading speech the Treasurer (Mr. Harold Holt) said -

In proposing the allowance the Government aims to encourage greater investment in our manufacturing industries and thus ensure, both in the short term and the long, a greater volume of both output and employment.

I think we can see something in the figures of the past which will allow us to test the possible effectiveness of this measure. For a long time the Government has been very generous towards investment in this country, through its depreciation allowances. An analysis of the components of the gross national product will show that investment allowances have risen consistently from £96,000,000 in 1948-49, to the very high figure of £556,000,000 in 1960-61. By an adjustment of the depreciation allowances the Government has allowed the aggregate to increase during its term of office from £96,000,000 to £556,000,000. This latter amount represents a very significant increase, as a percentage of the gross national product. The £96,000,000 at the beginning was 4.2 per cent, of the gross national product and the £556,000,000 at the end of the period was 7.9 per cent. One of the most significant changes in the economic position in Australia in recent years has been this almost doubling of the percentage that depreciation allowances represent of the gross national product.

When one considers that and the very large profits made in recent times, it is difficult to understand why the Government thinks that industry needs encouragement, by the provision of funds, to invest more. Despite the remarkable growth in depreciation allowances as a proportion of the gross national product and despite the record profits made in almost every section of industry, particularly in big industry, private fixed capital investment has not risen significantly.

In 1948-49, private fixed capital investment represented 13.1 per cent, of the gross national product. ‘ By’1954-55, it had risen to 17:6 per cent. It remained at about that level until last year,’ when’ it was about 1 per cent. more. In 1959^60 it rose to 18.3 per cent, and in 1960-61 to 18.4 per cent. Private fixed capital investment, as a percentage of the gross national product, has risen only slightly since 1954-55, and is less than it was in 1951-52. There has been a very significant increase in the depreciation allowance as a percentage of the gross national product, but there has been no significant change in the percentage represented by private fixed capital equipment. I think this suggests that the willingness of the Government to allow private industry to have an increasing percentage of the gross national product available to it for investment does not necessarily lead to any significant increase in aggregate investment.

Having found this situation a couple of years ago, I suggested in this House that there was a case for the method of coupling taxation concessions to investment rather than to depreciation. I have mentioned that in 1960-61 investment in fixed capital equipment reached the relatively high figure of 18.4 per cent, of the gross national product. That the situation is far from satisfactory in recent times is shown by the figures contained in the Treasury “ Information Bulletin” which has just come out. We find that the amount of new capital going into investment has fallen most significantly in the course of the last twelve months. There is no sign of a recovery, and any effect that enhanced depreciation allowances or increased profits might have had up to 1960-61 has certainly fallen away in recent months.

It seems to me that the case is far from established that the method that is being proposed will, under existing circumstances in Australia, achieve the results claimed for it by the Government. These allowances have increased retained funds, and that has had the effect of bringing about capital appreciation. They have caused a rapid and inflated turnover on existing assets more than they seem to have caused any increase in investment. There is a strong suggestion in the figures that they have contributed more to inflation than to increased production. .As anti-inflation or production-increasing measures, factors which increase the value of capital have gone fob’ far. ‘ From an aggregate point of view, I suggest it would be less inflationary and more production-increasing to direct the ‘ same volume of funds into the hands of consumers so that effective demand and purchasing power can be increased. -It would be better to do that than to put it where so much of it has gone already, without achieving the objectives of the Government.

I think the main problem to-day arises from a deficiency of demand, which the Government is trying to deal with, as it were, on the side of production. The Government is providing more liquid funds for the banks and is making things better on the production or investment side, but it is not going fast enough. The level of unemployment is still 100,000. The number of people registered for employment certainly fell by about 19,000 last month, but the number of people registered for unemployment benefit has fallen only by 3,000 or 4,000.

Mr DEPUTY SPEAKER (Mr Mackinnon:
CORANGAMITE, VICTORIA

– Order! I suggest that the honorable member is getting rather wide of taxation.

Mr CAIRNS:

- Sir, I do not want to become involved in debating that point, but surely this provision is intended by the Government to increase employment by increasing investment. The Treasurer said that very thing. 1 have already quoted him. Surely when he introduces the bill with a proposition such as that-

Mr DEPUTY SPEAKER:

– Order! I suggest that the honorable member make a passing reference to the matter.

Mr CAIRNS:

– The Government is very sensitive to comments on unemployment. There is no question about that. Anyhow, the unemployment figures are available for everybody to read in the “ Treasury Infor- ,mation Bulletin “. If they make satisfactory reading for the Government, I think the Government is in for another shock before very long when it goes to the polls.

I suggest that what is needed is more effective demand and a better and more convincing market to provide for expansion by manufacturers. I think this would be far more important and far’ more’ significant in increasing activity than would -be an 8 per cent, subsidy on investment in a market which has not been expanded. The great difficulty to-day is to get industry to use the available funds. There is a surfeit of funds in Australia to-day. The great difficulty is to get industry to use them. There is a surplus of funds. There is money to burn in one sense, although admittedly it is available at high rates of interest. This surplus exists only because the market has not convinced investors that it has a future for them.

The next point which I think emerges concerns the date of operation of this provision and the apparent termination of it. The significant thing about the Government’s measures over the last eighteen months is that they have been short-term - on and off. Is not this a striking example of that? The provision is intended to operate from 7th February, 1962, and it may come to an end on 30th June, 1962. Surely the Government is capable of making a proposition to industry for a term longer than five months. Is this not typical of the short-term views of the Government?

Assuming that this investment subsidy from taxation - that is what it is - has the general effect that the Government says that it wants it to have - and I think the figures I have cited in relation to the gross national product suggest that it may not have that effect - I think that two other things need emphasis. The first is that a very large proportion of the benefits which will accrue tinder this legislation will go to a very small number of manufacturers. The report of the Commissioner of Taxation for the 1958-59 income year provides us with evidence of this. In that year 1.67 per cent, of tax-paying companies had 64.1 per cent, of all company income. I suggest it is fairly safe to say that something like that percentage of the benefit will go to the small percentage of the total number of companies I have mentioned. Only 85 of these companies have an annual income of £1,000,000 or more. They represent only 12 per cent, of the 68,173 tax-paying companies in Australia and they enjoy 33.67 per cent, of the total income earned by all tax-paying companies. It is safe to say, therefore, that 85 of the 68,000-odd taxpaying companies will enjoy one-third of the benefit to be handed out under this legislation.

When we look more precisely, as did the honorable member for Melbourne Ports (Mr. Crean), at the actual amount allowed in depreciation we find that the 33,600 private companies mentioned by the honorable member for Swan (Mr. Cleaver) were allowed £34,687,406 and the 7,320 non-private companies were allowed £105,949,224. We find also that 954 of the 7,320 non-private companies enjoyed depreciation allowances amounting to £82,300,000. For the income year 1958-59, 954 companies received 58 per cent, of the amount granted by way of depreciation allowances. In other words, 3.1 per cent, of companies listed as receiving depreciation allowances and 1.4 per cent, of all taxpaying companies, obtained 58 per cent, of the total amount allowed for depreciation. Will not the situation be almost the same with this proposed investment subsidy? Will not the proposed subsidy give the greatest benefit to the largest concerns? Will it not make for the greater development of these concerns, and will it not increase the power of these larger organizations in the community? What a lot of humbug we have heard from the Attorney-General (Sir Garfield Barwick) about monopolies and restrictive trade practices! Why, discussions have been going on between the States and the Commonwealth for three years now and all this Government can do is produce a measure such as this which will only increase the very problems it is supposed to correct.

Assuming the measure has the aggregate effect that the Government desires, then, as the honorable member for Melbourne Ports points out, there is nothing selective about it at all. The funds involved will be distributed in relation to the size of the investment, irrespective of what the investment is. The type of investment will make no difference. Was it not possible for the Government to define some method of distribution instead of introducing a measure in which the definition of “ manufactured goods “ extends over eight pages? I have never seen such a definition as this. It is astonishing to think that any government or any responsible authority can produce a document such as this in which eight pages are devoted to defining ‘ “ manufactured goods “. What stage have we reached in this country when we have no one with sufficient command of the English language’ to do better than take up eight pages of a measure to define “ manufactured goods “?

Could not the Government set out a more precise list of priorities than that? In the engineering and metalworking trade there were 171 companies earning an income of £100,000 or more whilst fourteen enjoyed an income of £1,000,000 or more, according to the report of the Commissioner of Taxation. And in this industry are engaged some of the companies that I suggest will enjoy a greater benefit than all the companies engaged in all the other industries put together. But what about the companies engaged in the construction and repair of buildings? They are not manufacturing at all. Does not the Government want to encourage the construction and repair of buildings? Even if it did, I point out that few of the companies concerned with the construction and repair of buildings would be enjoying an income of £100,000 and over. Certainly none of them would earn £1,000,000 or more. This measure is simply designed to favour the big concerns. Is that what the Government wants? Does it want to see expansion in the engineering industry and the metal trades? Does it want to see expansion in the chemicals industry?

How can we achieve the kind of selectivity that I suggest we must have? In this respect, Australia would seem to be more backward probably than any other country of equal development in the world. I will not have time to discuss this development which the Government suggests it is setting out to achieve, and probably I should be ruled out of order if I did discuss it, but I point out that in France they go a good deal further than this Government proposes to go. Here, I refer to the “ P.E.P.” publication, dealing with economic planning in France. In that publication, it is pointed out clearly that it is impossible to achieve a rapid rate of growth unless selective measures are used to determine where investment shall go. There, the development is something like 4 per cent, or 5 per cent, whereas ours is probably less than 2 per cent. Certainly, we have the problem of maintaining full employment; and the maintenance of full employment is given first priority in French planning. I repeat that the French say it is impossible to maintain a rapid rate of growth without a selective system of directing investment. I refer the House to page 218 of the document to which I have referred, where it is stated -

While such an expansion appears compatible with overall full employment-

They refer to 5 per cent., or more than twice ours - - it will involve a considerable reduction in the agricultural labour force, a small increase only in industrial employment, but a much larger increase in employment in “housing, transport, trade, the professions and education.

I do not think the Australian Government has ever considered those possibilities. What kind of pattern of development do we need in the different industries to get the maximum rate of economic growth of which we are capable? There is no suggestion in the eight pages defining “ manufactured goods “ that this problem is being faced in any way at all. The value of the French example I have mentioned is that it is very clearly a pattern that tends to be acceptable to conservatives whereas the use of the word “ planning “ generally leads to the conservatives picking themselves up like ducks rising from a lake after the guns have been fired. The value of the French example - and I have often heard the honorable member for Bradfield (Mr. Turner) refer to it with some approval - is that it makes the conservatives think, and if the French have achieved that* they have achieved something worth while.

The other important point with relation to this measure is that the experience of the French people has shown that you cannot have a rapid rate of growth unless you have a selective system of directing investments into the channels in which it is felt they should go. In one sense, the measure before us does represent progress in that it relates to an investment allowance as distinct from the depreciation procedure; but it is restrictive in its effect. It shows no sense of priority, no recognition of what is needed in Australia to achieve the best rate of growth of which we are capable. For a good many years, full employment was the objective that progressive governments in many parts of the world set out to achieve, t have argued here on many occasions that this Government has given up even that objective. ‘ But progressive governments in the world to-day are going beyond full employment; they are giving some consideration to all the things which are necessary to achieve the most rapid growth which their economic circumstances and their balance of payments will permit. In countries where this is being done, aggregate rates of growth of something like 5 per cent, a year are possible of achievement. We in Australia are not getting a growth of more than 2 per cent. On the other hand, we have been forced to adopt the kind of economic policy that checks the economy and then tries to boost it. We are getting a slower rate of growth partly as a result of that and partly because we are unable and unwilling to adopt selective procedures to direct capital investment where it is most needed.

On that test, the bill fails completely, and because of that the Opposition is opposed to it. We will remain opposed to provisions of this kind until they pass that test. The criticism made by the Leader of the Opposition (Mr. Calwell) that these provisions are nothing more than hand-outs to people who already have most remains valid until something is done to make them pass the test that we apply to them. It is simply not sufficient to hand out millions of pounds to the large industrial concerns without requiring them also to apply some policy that the Government sets for them. That is the function of the Government and it is necessary for it to apply these policies as patterns of targets and priorities that are necessary to achieve the community’s purpose. The Government is the only body that can form the pattern of priorities and it is the only body that can use the necessary measures to persuade industry to achieve them. The measure fails completely when that test is applied to it and that is the reason the Opposition opposes it.

Mr EINFELD:
Phillip

.- I enter this debate because I believe it is proper that as frequently as possible a very clear and unequivocal statement should be made on the manner in which the Government is proposing to subvert the taxation system in order to make free gifts to certain manufacturers. At the outset I should like to point out that there is a complete difference between the normal depreciation allowance and this method of investment allowance. The difference should be emphasized so that the people will be well aware of the method by which this Government proposes to use taxation in order to give bonuses and gifts to manufacturers, particularly to large manufacturers.

The normal depreciation allowance, which is allowed on plant in factories, is a charge upon costs and is not deductible for taxation purposes from the net taxation assessment. It can be deducted only as part of the cost of a product. But the 20 per cent, investment allowance is an absolute gift of that much of the cost of the plant. It then comes off taxation if profits have been made and taxation paid as a net amount. There being such a complete difference between the two allowances, I believe the people ought to be told very clearly that the Government is subverting the taxation system in order to give bonuses to certain industries. I am well aware that this provision is intended to cover all industries. But what industry, after suffering the battering that came from the credit squeeze and the economic situation created by the Government, can outlay large sums of money on the purchase of plant? The only people who can do this are the monopolies, the cartels and the large industries. Other industries have not been able to do more than barely survive the economic stress and the grave recession of the past twelve or eighteen months. I believe it is politically dishonest for the Government to use this method to assist the big manufacturing industries, which really it represents.

The Government encourages imports to come to Australia from all parts of the world in direct competition with goods that are manufactured here, and then as a sop to big industry it is anxious to give subsidies in this form. But the only industries that will receive the subsidy are the industries that can spend money on plant. Who in Australia would be eager to provide large sums of money for the oil refineries? Who in Australia would want to say to General Motors-Holden’s Proprietary Limited, “ Despite the millions you have made, we want to make a present to you of more millions out of the money provided by the taxpayer “? I do not believe there is a man or woman in ordinary circumstances who would subscribe to the view that the

Government should be allowed to make free gifts of this nature to private enterprise.

If the Government had chosen certain special, important industries and “had -said, “ These industries need some help “, it is possible that we of the Opposition may have been interested in assisting the Government to help these industries to survive and to provide certain necessary goods or services. Let us look at the building industry. The Government has said that it should be stimulated. If the Government had said that the building industry or some section of it needed help so that it could provide employment and could continue to build at a high rate, it may have had a case for the provision of such an allowance as this. But it is politically dishonest to spread the allowance over all sections of industry.

The bill provides that the investment allowance shall apply from 7th February of this year. Which industries have displayed the greatest courage? Those industries that started to spend money on 1st July of last year, at the beginning of the financial year, despite the very great recession and the economic stress of that time, or those industries that started to spend money after 7th February of this year? It is quite obvious that the industries with the greatest courage were those that started to spend money at the beginning of the financial year, despite the great recession, in order to provide more plant and to bring their manufacturing capacity up to date and so help to provide employment. Such industries are certainly entitled to more recognition than those that have spent money only since 7th February of this year, knowing full well that the Government had offered them a bribe in the form of an investment allowance.

Mr McMahon:

– You do not honestly believe this, do you?

Mr EINFELD:

– Not only do I honestly believe it, but I think the Government is recreant to its trust to the people. I believe that the Government, in using taxation for the purpose of giving direct benefit to manufacturers, is subverting a system that has stood the test of time. It is using the system in a way that will blind the people of the country to its real purpose.

I mentioned the building industry.” There are other industries associated with it, and at this stage I mention the clay products industry.” This industry has spent considerable sums of money from 1st July to 7th February, despite the fact that it knew there was a recession, that there was unemployment and that there was loss of confidence. It spent this money because it had faith in Australia, and now it will suffer because it had this faith. I do not blame any industry for not having had the courage to spend money before 7th February, because any one who kept confidence last year after the great credit squeeze of this Government must have been the greatest optimist of all time.

The Australian Clay Products Association Limited has about 223 member companies. They make insulators, bricks, pipes, sanitary ware, wall tiles, refractory products, terra cotta roofing tiles and ceramic wall and floor tiles. They are comparatively small companies but they have a total capital investment of £100,000,000 and they employ 16,000 people. The industry is the third largest user of coal in Australia and with the exception of some imported machinery, it uses products wholly indigenous to Australia. From 1st July, 1961, to 7th February, 1962, the industry spent approximately £3,150,000 on n.ew plant. If the principle that the Government upholds is correct - and I do not think it is - the bonus should be paid from 1st July.

It is true, as the honorable member for Swan (Mr. Cleaver) said earlier, that any date would be an arbitrary date. But is not the proper, intelligent date the beginning of a financial year? Is it not proper that those who spent this money in a period of great recession, and in a period of hopelessness and desperation, should get the benefit of this provision? Nobody on the Government side expected that the Government would get back into office by the mere survival of one or two members with the help of a few Communist preference votes. Those who invested their money during the period of recession were optimists. They had a blind faith in Australia; yet this bill penalizes them. It means that those men carried on their businesses to the detriment of themselves. It means that their confidence and faith in Australia was harmful to their shareholders and. those they represented.

Mr Chaney:

– That is not right.

Mr EINFELD:

– It is quite clear. What happens to those who spent money on plant from 1st July, 1961, to 7th February, 1962? I repeat that they acted with a blind faith and with confidence in the growth and prosperity of Australia. They believed that, despite this Government, there would be some prosperity. History has told them how badly misplaced was their confidence. It has shown them that their confidence was the confidence of desperation. They should have felt hopeless at the time, because this Government had no intention of achieving, and no capacity to bring about, economic stability. Having acted as they did, these companies should not be victimized and handicapped because of their actions. That is what will happen to them, and I believe that the whole principle is wrong.

If the Government upholds the principle contained in this measure, why date it from 7th February, 1962? Why not date it from 1st July, 1961, as would have been reasonable and legitimate? Finally, if the Government wants to uphold a principle, why does it not act with courage, get rid of its tiredness, fatigue and exhaustion and examine industry in Australia? Why does it not try to help those industries which have been almost destroyed because of its action - industries whose products could be of very great benefit to the future prosperity of Australia?

Mr TURNBULL:
Mallee

.- I do not wish to deal at any length with the statements that have been made by the honorable member for Phillip (Mr. Einfeld), but it must be admitted that his speech encouraged lack of confidence in the state of the economy. That sort of speech will not engender confidence throughout Australia - if the people take any notice of spokesmen for the Opposition. The facts are that our overseas balances have increased dramatically, the hire-purchase debt has fallen considerably and the balances in the savings banks are at a record high level. The honorable member knows that if the Government picked out certain manufacturing industries that were to get these benefits, as he suggested, the Opposition would say, “You have picked out certain favorites for these concessions “. The honorable member knows also that the manufacturers who will get these benefits are the employers of Australia. Our arguments differ only because one side is for socialism and the other is for private enterprise.

The honorable member for Yarra (Mr. Cairns) criticized the honorable member for Swan (Mr. Cleaver) and said, “ I would be much more impressed with what the honorable member for Swan has said if I did not know that he always supports the Government “. The honorable member for Yarra knows that the slightest deviation on his part by indulging in some criticism of the Opposition’s policy would mean almost certainly that he would not be the selected Labour candidate for the Yarra electorate at the next election. If anybody wants any proof of that statement I have only to remind honorable members of the fate of the former Labour member for Adelaide, Mr. Cyril Chambers, and the former member for Kalgoorlie, Mr. Johnson.

However, I shall be brief. I want to reply to some statements that were made by the honorable member for Melbourne Ports (Mr. Crean). When he speaks of the primary producers, the honorable member always wisely points to this corner, where members of the Australian Country Party sit. The honorable member says at such times, “ The Country Party should deal with this”, or, “What does the Country Party think of that? “ To-night he referred to me, so I am duty-bound to answer him. Certainly, the members of the Australian Country Party are the great fighters for the man on the land. As such, they fight for those who provide the goods and the money that make for the stability of Australia - not only the stability of the primary industries but also of the secondary industries, because without the exports of primary products, the manufacturers could not buy raw material to keep the secondary industries in operation.

The honorable member for Melbourne Ports asked what I thought about the manufacturers getting a better deal than the primary producers under the provisions of this bill. He quoted the case of a man on the land who bought a machine for £1,000 and in five years wrote off the £1,000 with the special depreciation allowance of 20 per cent, per annum. He compared such a man with a manufacturer in a neighbouring town who buys a machine for £1,000 and gets a special depreciation allowance for the first year of 20 per cent, and the normal depreciation concession for the relevant period. He said that such a man would write off 120 per cent., compared with 100 per cent, written off by the primary producer, and he asked, “ What does the Country Party think about that? “ I ask, “ What do the primary producers think about that?”

Does the honorable member for Melbourne Ports think that the primary producers would change the concessions they have for the concessions that will be given to manufacturers? Of course they would not. The virtue of the 20 per cent, allowance for five years is this: At the end of five years the primary producer has written off the full cost of the machine or building with tax deductions. The o’ther man certainly can write off 120 per cent, in certain circumstances, but it takes him much longer - possibly ten years. The primary producer gets the benefit of the concessions in the shortest possible time. The Country Party has always supported the 20 per cent, depreciation allowance, which was introduced by this Government. The Opposition, when in office, had no thought whatever of granting the primary producers a depreciation allowance of 20 per cent, each year for five years.

Honorable members like the honorable member for Phillip would say it is quite wrong to give primary producers such a good deal in the way of tax deductions, but the Government parties realize that the primary producers must get the best possible deal.

Mr Einfeld:

– I did not say anything about the primary producers; I like them.

Mr TURNBULL:

– I am not saying that the honorable member said anything against the primary producers; I know he did not. The Government realizes that the primary producers must get the best possible deal. I regard the honorable member for Melbourne Ports as one of the best members on the Opposition side, but he must know that the primary producers, with a depreciation allowance of 20 per cent, for five years, are getting a better deal than the manufacturer who will get 20 per cent, for one year and the normal rate of depreciation. We members of the Country Party appreciate the value of this measure.

Mr THOMPSON:
Port Adelaide

– Mr. Deputy Speaker, I would not have spoken were it not for the remarks of the honorable member for Mallee (Mr. Turnbull), who condemned the honorable member for Phillip (Mr. Einfeld) in rather scathing terms. In my opinion, the honorable member for Phillip went to the real point of this matter. He wants to be fair and just to people who will not be provided for by this bill. It will merely give a bonus to those big companies which can install plant during the remainder of the current financial year. As the honorable member for Phillip has stated, those manufacturers who installed plant before 7th February will not get the benefit of the investment allowance if the increase in production resulting from the use of the new plant occurred after 7th February. The honorable member complains that the bill applies to the present financial year, but that only producers who install plant after 7th February will get the benefit of the 20 per cent, investment allowance on the expenditure on the new plant.

Mr Turnbull:

– That does not apply to primary producers.

Mr THOMPSON:

– I am not arguing against the primary producers. The big companies about which I am speaking will get pounds compared with pennies for the primary producers.

Mr Turnbull:

– Not on percentages.

Mr THOMPSON:

– I am not talking about percentages. I am not talking about the allowance of 20 per cent, a year over five years. I am speaking of the new investment allowance with respect to plant installed after 7th February of this year. The honorable member for Melbourne Ports (Mr. Crean) understands the position. The honorable member for Mallee said that he looked on him as being one of the best members in this place. By that, the honorable member for Mallee meant that the honorable member for Melbourne Ports knows what he is talking about.

Mr Turnbull:

– No. I meant that he » a very decent fellow.

Mr THOMPSON:

– The honorable member need not try to twist it round. There are lotsof decent fellows here. In fact, I do not know any member of this place who is not a decent fellow. I repeat: The honorable member for Mallee said that he looked on the honorable member for Melbourne Ports as being one of the best members here.

Mr DEPUTY SPEAKER (Hon W C Haworth:
ISAACS, VICTORIA

– Order! I suggest that we ought to get back to the bill.

Mr THOMPSON:

– That is all very well, Mr. Deputy Speaker. I have yet to learn that the occupant of the chair will allow one honorable member to make a statement and prevent another honorable member from replying to that statement. If the honorable member for Mallee was permitted to make a certain statement, I should be entitled to reply to it. The honorable member stated that he would not have spoken had it not been for the remarks of the honorable member for Phillip. If the honorable member for Mallee attacks the honorable member for Phillip over the case that he presented, I shall not sit idly by and let the attack go without any reply.

The honorable member for Melbourne Ports stated the Opposition’s attitude to the main provisions of this bill. We do not like the proposed investment allowance, and that part of the bill which provides for this allowance is the part to which we are opposed. We are not merely expressing this opposition for political purposes. We are trying to put a proper argument in relation to business affairs in this country. Honorable members opposite may point to large enterprises in South Australia, such as Chrysler Australia Limited and General Motors-Holden’s Proprietary Limited - two large motor manufacturing concerns. General Motors-Holden’s embarked on an expansion programme entailing the expenditure of many millions of pounds long before this investment allowance was thought of. But I take it that expenditure on the installation of plant after 7th February last will be subject to the benefit of the proposed investment allowance. That is the point made by the honorable member for Phillip. I think that he did a real job in stating it.

As I have said, this measure will give a bonus to people who install plant after ‘ 7th February. I imagine that that date was chosen because it was the date “ on which the Prime Minister (Mr. Menzies) announced that the Government would provide incentives for industrial expansion in this country. I would go back beyond that date and apply this proposed investment allowance to expenditure made since the beginning of the current financial year.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 6 - by leave - taken together, and agreed to.

Clause 7 (Special deduction for investment in manufacturing plant).

Mr CREAN:
Melbourne Ports

– Mr. Chairman, as I intimated at an earlier stage, the Opposition intends to vote against this clause.

Mr CHANEY:
PERTH, WESTERN AUSTRALIA · LP

– Will you divide on it?

Mr CREAN:

– Yes. The clause extends over six full pages and parts of two other pages of the bill. It represents the major part of the measure. There seems still to be some confusion about the provisions contained in this clause, as was suggested by the remarks of the honorable member for Mallee (Mr. Turnbull). Therefore, I would like briefly to repeat the difference between depreciation allowances provided in the past in this country and this new device which is known as an investment allowance, although it is not actually described in the bill by such a term. The honorable member for Mallee seems to be satisfied that the sort of depreciation allowance that a primary producer gets is as good as is any allowance given to any one’ else. He seems to be satisfied with five units for the primary producers, whereas this bill will give six to the remainder of the community. A primary producer can claim a deduction of 100 per cent, of expenditure on plant used for primary production, including agriculture, only over a fiveyear period, whereas, under the terms of this clause, 20 per cent, overand above the full cost of plant installed may be claimed by certain manufacturers.

Mr Turnbull:

– For how many years?

Mr CREAN:

– I am not arguing about the number of years. If the honorable member had listened, he would know that I had suggested earlier that it is a matter of indifference whether the depreciation allowance is given over one, two, three, four, five years or longer. I do not think it matters. The only reason why the honorable member favours the five-year period is that the cost can be averaged out. The period could still be optional. Indeed, in some instances the individual has an option to choose a faster or a slower method so that he will get more in the first year than he gets in the other years. He can use a reducing-balance method or a straightline method of assessing depreciation. However, I do not want to go into that.

This bill will import a new principle into the law, and that principle will apply only to limited sections of the community. A purely arbitrary percentage has been chosen. Why has 20 per cent, been selected? Why not 40 per cent, or only 10 per cent:? In the terms of this clause, an investment allowance of 20 per cent, is to be introduced only in respect of manufacturing. It is difficult to define “ manufacturing “ so as to include what we want to include and so as to exclude what we want to exclude, and that is the difficulty that has resulted in the rigmarole of previsions that we have before us. My colleague, the honorable member for Yarra (Mr. Cairns), directed attention to the situation in which the Government now finds itself. It is typified, I suggest, by the wording of paragraph (h) of sub-section (3.) of proposed new section 62aa, which appears on page 4 of the bill. Just look at the miscellany of objects included - blocks, bolsters, core boxes, dies, driers, flasks, gauges, jigs, lasts, matrixes-

Not matrices, but matrixes - moulds, patterns, saggars-

Whatever they are - stereotypes, templets and tooling (including workholding fixtures, working heads and tool holders), and articles of a description, or having a use, similar to that of any of those articles.

Then in paragraph (i) we have another list - hand tools and other loose tools, including anvils, arbors, augers, bits, blow lamps, braces, brushes, buckets, buffers, callipers, chisels, chucks, clamps - -

And so on until we come finally to - vee blocks, vices and wrenches, and, articles of a description, or having a use, similar to that of any of those articles.

I personally compliment the officers of the Taxation Branch on being able to prepare these clauses so as to give some impression of sanity to the intentions of the Government, because that is not a very easy task, as many of us know. I repeat that the Government is attempting to do something in this measure that an income tax measure is not made to encompass. It is the third occasion on which the Government has tried to do this, and it has failed just as miserably as it did previously. Instead of choosing the industries to subsidize it would have been better to have used the method of excluding certain industries. For example, the breweries could have been excluded, and the money thus saved could have been made available to the industries that are considered socially more essential. We propose to oppose this measure because it embodies this principle that we think undesirable, lt is unselective, and it is a bad way of doing something that might be desirable if approached from an entirely different angle.

Finally, let me say that if the honorable member for Mallee (Mr. Turnbull) is satisfied with five when he might get six, then I leave him to his ignorance and his satisfaction.

Mr TURNBULL:
Mallee

.- The honorable member for Melbourne Ports (Mr. Crean) has stuck to his guns on this matter of 120 per cent, as against 100 per cent. When I pointed out to him by way of interjection that the 100 per cent, in the case of the primary producer is over five years, which is 20 per cent, a year, while the other method may extend over many more years, he said that that was immaterial, that it did not matter. My point is that this is a vitally important matter. If you can write something off in five years, a comparatively short time, it is of vital importance, and that is the virtue of the legislation so far as the primary producer is concerned. The honorable member has simply repeated what he said in the first instance.

There is only one other point I would like to make. The honorable member for Melbourne Ports said that the Australian Country Party probably liked the five-year period because the primary producers can average out the figures. That is quite true, but the honorable member said - I hope I have not misunderstood him - that it would not make any difference whether the period was one, two or three years-

Mr Crean:

– Or four, five or six years.

Mr TURNBULL:

– Well, or four or five years. I cannot follow that way of thinking, because if the period is restricted to one year, it may be a year in which the particular primary producer experiences a drought, or some other hardship, and he may not receive any income in the year. In that case, the taxation concession would not be worth anything at all. If he could spread it over five years he would get a reasonable deal. I cannot understand the honorable member’s thinking in this respect.

Question put -

That the clause be agreed to.

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

AYES: 59

NOES: 57

Majority . . . . 2

AYES

NOES

Question so resolved in the affirmative.

Clauses 8 to 11 - by leave - taken together, and agreed to.

Proposed new clause 8a.

Mr BURY:
Minister for Air and Minister assisting the Treasurer · Wentworth · LP

.- I move-

That the following new clause be inserted in the bill:- “ 8a. - (1.) Section seventy-eight of the Principal Act is amended -

by adding at the end of paragraph (a) of sub-section (1.) the following subparagraph: - (xxxviii) the Australian National Committee for the Freedom from Hunger Campaign;’; and

by adding at the end thereof the following sub-section: - (3.) A gift to the authority specified in sub-paragraph (xi) or (xxxviii) of paragraph (a) of sub-section (1.) of this section is not an allowable deduction under this section unless the gift was made before the first day of July, One thousand nine hundred and sixtythree.’. “ (2.) The application of the amendment made by paragraph (a) of the last preceding sub-section extends to gifts made before the commencement of this Act.”.

Honorable members will be aware that the United Nations Food and Agriculture Organization is presently conducting a campaign to make known the degree of hunger that exists in some countries with a view to bringing this deplorable situation to an end.

Australia has agreed to assist a world campaign for this purpose, and a number of our citizens have set up the Australian National Committee for the Freedom from Hunger Campaign. The committee is to launch in Australia an appeal for funds and the amendment that I have moved is designed to authorise income tax deductions for gifts made to the committee. The deductions will be available for gifts of £1 and upwards made to the committee by 30th June, 1963.

Should the committee reach its target the cost to revenue of the deductions in relation to the proposed appeal by the committee for the Freedom from Hunger Campaign will be of the order of £250,000. The amendment I have moved has the further purpose of achieving parity between the Australian National Committee for the Freedom from Hunger Campaign and the United Nations Appeal for Children. Gifts to the latter appeal were authorized at a time when it was understood that the appeal would be of short duration, and it is- now proposed that the deductions should, like deductions for gifts to the Australian National Committee for the Freedom from Hunger Campaign, be available for gifts made up to 30th June, 1963.

Mr CREAN:
Melbourne Ports

– On behalf of the Opposition I state that we offer no objection to gifts to this appeal being treated as allowable tax deductions. I should like my colleague, the honorable member for Phillip (Mr. Einfeld), who is deputy chairman of the fund concerned, to speak to the amendment.

Mr EINFELD:
Phillip

.- I have pleasure in supporting the amendment, and in doing so I think it proper to bring to the notice of honorable members this very important appeal which will be launched in the not very distant future. It is hoped that the Freedom from Hunger Campaign will not only bring to the notice of the people of this country the very great problems of the under-privileged countries in respect of growing and providing the necessary foodstuffs for their populations but will also cause us to raise sufficient funds in this country to enable us to provide a very great deal of technical assistance to countries whose ‘people are very seriously undernourished. ‘

Mr Malcolm Fraser:
WANNON, VICTORIA · LP

– You would do more by supporting them in the trade field.

Mr EINFELD:

– That is what the honorable member says, but the facts are that even the honorable member, whose hardheartedness is no doubt known to all members, will probably melt a little if he will think for a minute of the men, women and children - two-thirds of the population of the world - who are under-nourished and under-privileged and cannot get enough food. Surely that will permeate even the hard-heartedness of the honorable member, who does not bother to think about other people, such as the people living in those countries. It is hoped that as a result of this campaign Australia will play its part with many other members of the United Nations in providing technical assistance to the under-privileged countries particularly, in our case, in the South-East Asian area where we are anxious to have good relations existing. This is purely a humane appeal, sponsored by the United Nations to bring technical assistance and technical know-how in the growing of food and to provide implements and technicians to help these countries to grow food. Because of that, I believe that the appeal should be strongly supported by every member of the community.

New clause agreed to.

Title agreed to.

Bill reported with an amendment; report - toy leave - adopted.

Bill - by leave - read a third time.

page 1881

SALES TAX ASSESSMENT BILL (No. 1) 1962

Second Reading

Consideration resumed from 1st May (vide page 1756), on motion by Mr. Harold Holt-

That the bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1882

PAY-ROLL TAX ASSESSMENT BILL 1962

Second Reading

Consideration resumed from 1st May(vide page 1756), on motion by Mr. Harold Holt-

That the bill be now read a second time.-

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1882

WOOL TAX ASSESSMENT BILL (No. 2) 1962

Second Reading

Consideration resumed from 1st May (vide page 1756), on motion by Mr. Harold Holt-

That the bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1882

SUSPENSION OF STANDING ORDERS

Motion (by Mr. Townley) agreed to, with the concurrence of an absolute majority of the members of the House -

That so much of the Standing Orders be suspended as would prevent Orders of the Day Nos. 8 and 9, Government Business, being called on.

page 1882

TOBACCO CHARGES ASSESSMENT BILL 1962

Second Reading

Consideration resumed from 1st May (vide page 1756), on motion by Mr. Harold Holt-

That the bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; reported adopted.

Bill- by leave - read a third time.

page 1882

STEVEDORING INDUSTRY CHARGE ASSESSMENT BILL 1962

– Second Reading.

Consideration resumed ‘from. ‘1st May (vide page’ 1757), on motion by Mi”. Harold - Holt-

That the bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; reported adopted.

Bill - by leave - read a third time.

page 1882

ADJOURNMENT

Newspaper Report - Anna Bay Bombing Range - Shipbuilding - Commonwealth Parliament Offices - Royal Australian Air Force - Television

Motion (by Mr. Bury) proposed -

That the House do now adjourn.

Mr HAYLEN:
Parkes

.~Before the House adjourned for the Easter recess I asked a question of the PostmasterGeneral (Mr. Davidson) about third commercial television stations in the capital cities. This brought a bitter personal attack on me from the “ Sydney Daily Telegraph “. I feel I must reply to this attack for two reasons, and they concern honorable members on both sides of the House. First, I was not able to find a suitable opportunity to speak on this matter before the Easter recess and, secondly, I feel that more than my own reputation is involved, and that behind the savagely personal attack was an attempt to intimidate me as well as other members.

It is absolutely essential that a member be able to speak out in the House without fear of personal reprisals such as I have experienced. Otherwise, an important aspect of privilege is involved. I do not invoke privilege in this case. I can handle the matter myself. But let me say at once, I not only accept but support the view that the press, the yellow press included, must at all times and in all circumstances have the right of full criticism of anything a member says’-‘or does in this House. But the article to which I refer was a savage attempt to stifle’ me and close my mouth in this House. Besides having nothing to do with the case if was personal, vindictive. lying and intimidatory. Apparently my question went very close to the bone.

The trouble here is that Sir Frank Packer, known to journalists as “Pack the Sack “ and his editor-in-chief, Mr. McNicolI, known equally well as “Mack the Knife” think that “freedom of the press “ is a spiky-headed bludgeon by which they can smash anybody standing in their path. I must contest this viewpoint at all costs. They should know down at the “ Daily Telegraph “ that “ The Four Freedoms “ is not the title of a Yankee television western. It is something more important than that. I am not prepared to substitute for it the three stooges at the “ Daily Telegraph “-Packer, McNicoll and Reid.

It appears that my question flushed a nesting bird or two out of the jungles of big business; that I have upset a ramp, or disturbed an arrangement. Otherwise, why all the fuss? Why was McNicoll, who was resting at Palm Beach after a deluxe tour abroad on the free list, rushed back to the office to “ do me over “ editorially? And why did Sir Frank Packer personally take charge of the “ hate Haylen “ campaign, reinforced by his company of stooges who were told to tip all the garbage cans in Consolidated Press on my defenceless head? This is, of course, intimidation. It is intended to intimidate me. Any one who stands in Packer’s path on television - except for the weaklings on the other side of the House - will be intimidated, and that is why I raised this matter. What did I ask in my question, Mr. Speaker? Why did it provoke such a slanted and tangential attack? I asked a simple quiz question, the sort of entertainment beloved of the television tycoons. I simply held up an envelope and asked “ What is in it? “ and then somebody burst a blood vessel down at the “ Daily Telegraph “.

That is my personal case. But now that we have discussed the “ Daily Telegraph “ let us talk about the way in which it starts attacks not only on me but on all Labour members of this House. Let me give instances, and the Government should listen to this. Recently the Leader of the Opposition (Mr. Calwell) made a statement on television - a statement that was handed ou.t to all sections of the press. The “ Daily Telegraph “ printed the news item in full accompanied most outrageously by an editorial addition in the story itself suggesting that the article was inspired by another television group. If the “ Daily Telegraph “ wanted to say that, the proper place for such comment was not in the news columns but in the editorial columns. The hotchpotch combination of straight news and biased editorial in the one article was the lowest trick ever practised on a national leader in the history of Australian journalism.

How fair a deal does the Labour Party get from the “Daily Telegraph”? Not only is there a denigration of everything that Labour does, but also there is intimidation, which we are not going to stand any longer. How fair a deal do we get? Here is another example: Recently, a great national issue was raised by the Labour Party on the motion for the adjournment of the House. We initiated the debate. The “ Daily Telegraph “ had been screaming for some action for weeks and weeks. The Labour Party initiated this action and in the “ Daily Telegraph’s “ report the next day Labour Party speakers got three lines and the Minister’s reply got two columns from the fair-minded “ Daily Telegraph “. Is that not intimidation by inference - an instruction that although you may raise your voice, your remarks will not be published?

Another interesting facet of “ Daily Telegraph “ reporting has won the admiration of world journalism for its utter daring. It reveals the comic commandos of the “Daily Telegraph” at their best. This is what they do and they have done it to us: They write a blazing editorial, full of heat and thunder, about a news item which they have never printed. Has there ever been anything so absurd in all the history of journalism? I suspect that “Mack the Knife “ reads the clippings from the “ Sydney Morning Herald “ to get news for his editorials. So we have editorials about news items that never appeared in the paper itself.

Here is another “ Daily Telegraph “ scoop which sent the nation into hysterics. I remember that just prior to the federal election on 9th December the “ Daily Telegraph “ wrote a slobbering editorial saying that the Menzies Government would sweep the country. It paid an oleaginous tribute to the Prime Minister (Mr. Menzies) who was getting very few bouquets at the time. It held the begging bowl under the Prime Minister’s nose for any unconsidered trifle which might come the way of the “ Daily Telegraph “ after the election - an outlet for its Yankee television programmes in other capitals, for instance. But alas for dreams! This one developed into a nightmare. The Government was dragged to the edge of the precipice with the “ Daily Telegraph “ held screaming in its arms. A love pact with such a sad ending! What a great Australian television comedy it would make! This would be a nice piece of ham indeed - the Prime Minister and his unwanted admirer on the same bill. I know that the “ Daily Telegraph” accuses me of using ham but at least it is good, clean sun-cured Australian ham. I prefer it to the syndicated salami that they hand out at the “ Daily Telegraph “ or the imported boloney that they slice up on television.

Returning to the matter on which I rose to speak, I believe that I have uncovered an impudent and cunning attempt to manipulate television station licences in the interests of certain people and organizations. I made no charge; I sought information; I challenged the Government on the matter. Sir Frank’s name, up to that time, had not been mentioned by me. Why he bought in was best known to himself. I hope that it is not a case of -

The wicked flee where No man pursueth

Let me say this in conclusion: No moderator of muck is going to intimidate me, nor any buccaneer of the bash beat me into silence when I have something to say on behalf of my party. The job that I have to do as a Labour man, I believe, is this: To see that there is a proper Australian content in television programmes; to find work for Australian actors, writers and technicians in the new field of television; and to supervise the issue of operating licences and see that every one gets a fair go. Behind me in this fight is the Labour Party by its policy decision and the unions by a firm resolution of the Australian Council of Trade Unions, which is a model of good Australian thinking on the problem of television and mass mediums. If the “ Daily Telegraph “ wants a knock-down, drag-out fight on this matter there will be plenty to accommodate it from this side of the House.

Mr JONES:
Newcastle

.- Mr. Speaker, I wish to refer to a question which was asked by the honorable member for Lyne (Mr. Lucock) and to the reply which was given by the Minister for Air (Mr. Bury) on 12th April, the honorable member for Lyne asked the Minister -

Has the Minister’s attention been directed to a report in the Sydney “Daily Mirror” of 11th April concerning Royal Australian Air Force exercises in the Port Stephens area?

There was more than that in the question, but that was the crux of it. The Minister gave a lengthy reply to what was obviously a Dorothy Dix question, having regard to the information given in the reply. The Minister said -

A systematic campaign is being conducted, which is characterized by gross exaggeration and misrepresentation. . . .

He also said -

The only specific happening of that time known to the Air Force occurred about eighteen months ago, when a bomb was exploded and a small piece of shrapnel travelled about four or five miles and landed in the scrub not far from somebody’s garage.

On 10th, 11th and 12th April, petitions were presented to this House which were, in fact, protests by people living at Morna Point against the use of Morna Point by the Royal Australian Air Force as a bombing range and by the Army, from time to time, for military exercises. These people have suffered considerable inconvenience as a result of these activities. All that they ask - and I believe that their request is justified - is that some other place be found for the bombing range.

This place has been used for that purpose for the past twenty years, as the Minister indicated in his reply to the honorable member for Lyne. It is obvious that when this site was originally selected it was suitable for a bombing range. Very little development had taken place there. Very few houses had been built in the locality. So the Air Force was quite justified in selecting Morna Point for a bombing range. But since then a great deal of development has taken place right along the coast, because of the ideal surroundings for people who wish to build week-enders and for others who wish to build homes in which to retire. For this reason, I believe that the Air Force should reconsider its position with regard to the bombing range. To suggest, as the Minister for Air has suggested, that no other suitable place can be found for a bombing range in a country the size of Australia, with so few people and so little development, is absurd.

I shall read a number of letters which people living at Morna Point have written, protesting against what is taking place there. I have here a cutting from the Newcastle “Sun” of 11th April which reports that people - people other than those who have written to me - have approached the Port Stephens Shire Council complaining about the inconvenience suffered by them. The Minister has said that he has received no reports of any damage or trouble caused by the Air Force. In this newspaper appears a picture of an old lady, Mrs. L. J. Fox, of Anna Bay, holding heavy machine gun cartridges which fell on her husband’s market garden. The Minister has said that no damage could be caused and that none bad been caused, except when a bomb exploded in the wrong place eighteen months ago. I have here a letter from Mrs. Verlie Pollock, who thanks me for forwarding a letter to her and says -

I have gathered a few names an J addresses from citizens who live directly in line of fire of these exercises - others were not at home when I called to obtain necessary information, but I do think the enclosed list from people directly concerned will be adequate to realize the imminent danger to these people even inside their own houses and yards and to those who wish to visit the beach for relaxation so frequently. Believe me, the danger is very real, but all this danger and anxiety to residents would be eliminated if exercises were carried out around the “ Uralla Beach “ area, this request is all we ask as we are fully aware practices must be continued.

This shows that the Minister’s statement that these people are not realistic as far as bombing practice is concerned is incorrect. They realize that the Air Force and the Army have to undergo training but they ask that it be carried out in a less populated place. This is what Mr. J. Pratt, of Georgestreet, Anna Bay, says - 20 mm. shells have dropped in my backyard in George-street, Anna Bay. We are only living about i mile from bombing range.

Mr. J. Adams writes 20 mm. casings through my roof and another through the guttering. Often casings fall in the yard.

Another man, of whose name I am not sure - it may be Ivan A. Dee or Vee or Lee - writes - 20 mm. shells have hit my truck and bouse in George-street, Anna Bay, and a bullet pierced a shed.

Mr. Jack Robinson, of Anna Bay, says 20 mm. shells have put holes in my roof and broke a window and have killed laying fowls on my poultry farm.

Mrs. Sylvia Robinson writes

My mother and I lived close together within distance of 10 yards between. The casings fell close and on the main road. At one period the casings went through my mother’s roof, broke tiles and let the rain enter the bedroom walls. Upon my reporting to R.A.A.F. at Williamtown they came and repaired the roof and also painted the room after we had shown them the various casings and they obtained their number.

Mr. J. N. Gordon, of Anna Bay, writes- 20 mm shells have fallen on my home and farm.

Mrs. Frances Lee states

On one occasion I had two bullets through one sheet on the washing line. All I got was apologies. On several occasions my husband has been chased out of our own market garden by flying shrapnel, and a couple of times 1 have gone out for the day because 1 heard and saw flying bullets and other things slapping into trees right near the house. The last exercise gave our family the bigger scare when two rockets landed just a i mile (half) from the house.

She says that they scared the mother of four children.

Mr. W. Thompson, a poultry farmer, writes

I have had 20 mm shells hit my poultry farm sheds, also have put my fowls off laying for a few days. I have been very close to where they have fallen in my yard.

From C.M.F. I have had machine gun bullets hit a window and have had one go through my daughter’s bedroom window on to the floor breaking my window.

When the exercises are in progress I have to remove the light fittings as previously had them smashed. When the exercises are in progress my home rocks.

Mr. N. Fox writes

We have had shrapnel and 20 mm shells on our own property for the past five years and on many occasions have complained to the R.A.A.F. who have visited the property and removed the shrapnel and on occasions have placed sentries on our private road to give warning when the aircraft were overhead, also removed spent shells and examined our roofs to ascertain if the shells which had fallen on the roof had not made holes.

I will agree that the letters and statements made by these people may not be couched in correct Queen’s English, but they do convey to the Minister and the House that these people have a justifiable grievance. They do convey that there is something the matter, that these people do have a genuine complaint. The petitions containing about 350 signatures which were submitted here were an expression of protest by these people and they did ask that something be done about the matter. It is high time that something was done not only to move the Morna Point establishment to some other area where inconvenience would not be caused to residents but also to prevent a continuation of the exercises which are causing these people so much worry and inconvenience.

I am prepared to give the Minister the original letters received by me from the people concerned together with copies of the statements made by people other than those whom I have mentioned, at a meeting of the Port Stephens Shire Council on 10th April, and reported in the Newcastle “ Sun “ of 11th April.

Mr SPEAKER (Hon Sir John McLeay:

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

Mr HANSEN:
Wide Bay

.- Tomorrow morning there will be launched at the shipyard of Walker’s Limited, Maryborough, a small general purpose vessel to be used by the Philippines Government. I understand that this vessel is being given to that government under Seato arrangements. The workmen at the Maryborough shipyards, who were workmates of mine, are most perturbed at the fact that Walker’s Limited have no further orders in hand. I understand that the company has tendered for other work but has received no acceptances to date. The shipyard of Walker’s Limited dates from the 1880’s and although it enjoyed no great continuity of work till 1940, it is a fact that since 1940 there has been some continuity of orders and some permanency of employment for the workers there. I know that the Minister for Shipping and Transport (Mr. Opperman) will say that work is scarce, that there is no great demand for the type of vessel which can be built by Walker’s Limited at Maryborough - vessels of 2,500 tons and under - but I gave him notice that I intended to direct his attention to this matter during the adjournment debate to-night.

I now direct his attention to the fact that a Danish company, the Clausen Shipping Company, has obtained a subsidy from the Queensland Government for the transportation of cattle by sea to the Queerah meatworks at Cairns. Formerly, cattle were transported by the vessel “ Wewak “, but the contract with the owners of that vessel was cancelled, and the Clausen company, in which I understand Sir William Gunn is actively interested, has been given the contract together with a substantial subsidy from the Queensland Government for the transportation of cattle by sea to the Queerah meatworks. I understand that this company has chartered a German ship named “ Cora “, which arrived at Cairns only last week, and that the transportation of cattle by this vessel will commence on 25th May next. I understand, too, that Sir William Gunn, as representative of the Clausen company, made inquiries of two Queensland shipyards in March last year as to whether a vessel suitable for this type of work could be built by them by March of this year. He stated that plans and specifications of the type of vessel required were available, and I believe Walker’s Limited indicated that they would be prepared to submit a tender for the construction of such a vessel after they had the opportunity to study the plans and specifications. But the plans and specifications were never shown to Walker’s Limited. I believe that Evans Deakin Limited were in a more favoured position in that they did see the plans and specifications but no further inquiries were made of them. I understand that inquiries were made also of the Australian Shipbuilding Board with relation to the construction of a suitable type of vessel, but no further approach was made to that authority.

The Queensland “ Sunday-Mail “ reported that the Clausen company had placed an order in Yugoslavia for a 300-ft. vessel capable of transporting up to 800 head of cattle. It is expected that this vessel will be delivered not this March, as was demanded of the Australian shipbuilding yards, but next year. As the Minister knows, his approval must be sought before any vessel may be brought to Australia from overseas. This is provided for in the conditions relating to item No. 24 of the third schedule to the Customs (Prohibited Imports) Regulations. One of those conditions reads -

The importer shall produce to the Collector the permission in writing of the Minister of State for Shipping and Transport to import ships.

I have reason to believe that to date the permission of the Minister for Shipping and Transport has not been sought and, on behalf of the workmen employed in Australian shipbuilding yards, who would have had some continuity of work had this vessel been constructed here, I ask the Minister whether this company has sought his permission to have the vessel built in Yugoslavia. I should like to know also why, if twelve months ago it was essential that delivery of the vessel be made by March of this year, the contract was let overseas. It would appear now that the date of delivery was not as urgent as the company for which the vessel is being constructed led the Australian shipbuilders to believe.

If this vessel is built in Yugoslavia and brought to Australia I am certain that protests will come not only from myself and other representatives of areas in which shipbuilding yards are situated, but also from the shipbuilding interests themselves. It is deplorable to think that this vessel should be built overseas at a time when the shipbuilding industry of Australia is crying out for orders. Therefore, I look to the Minister for some support of my request that permission to have this vessel built overseas be refused. I should also like some inquiry to be made as to whether the company concerned was genuine when it sought tenders last year for the construction of this vessel in Australia.

Mr OPPERMAN:
Minister for Shipping and Transport · Corio · LP

– Mr. Speaker, in reply to the honorable member for Wide Bay (Mr. Hansen) I should like to emphasize that this Government always has had a great regard for the interests of the shipbuilding industry. That can be confirmed easily by considering the number of ships that have been built in Australian shipyards in recent years, the subsidies that have been paid, and the amount of employment in the shipyards during a period when the shipbuilding industry throughout the world has been in a depressed condition.

To-night the honorable member for Wide Bay has discussed a particular situation which is very much under the control of the Queensland Government. Obviously, that Government is desirous of attending to the needs of the beef industry, which is also an important industry. I say quite candidly that I have never heard of shipbuilding in Yugoslavia or the ship mentioned by the honorable member; but, as he has asked me to do, I will investigate the matter that he has outlined this evening in order to see exactly what the position is about the ship that he mentioned.

Mr WEBB:
Stirling

.- Mr. Speaker, I wish to raise a matter that concerns the Department of the Interior. I am sorry that the Minister for the Interior (Mr. Freeth) has left the chamber. I have already raised this matter with him. When I was elected as the member for Stirling, I wrote to the Minister, asking for the right to have an office in the electorate of Stirling. I quote the following passage from the reply that I received from him: -

Although there are a number of members in the various States who have offices in their electorates it has never been laid down that this is at the complete option of the member. All other circumstances are taken into consideration. A member with a country electorate some distance from the city obviously may have a greater requirement for a country office. From the Government’s point of view for efficient administration and economy it is better to have members’ offices together as far as possible. This also enables a far better standard of accommodation to be supplied. It was for this reason that sufficient accommodation was acquired in the present Parliamentary offices for all members, and so far all metropolitan members excepting the Member for Swan are offered accommodation there. Apart from your own personal preference, it would seem reasonably central for an electorate which stretches from the sea to Midland Junction. In the case of the Swan electorate, the member’s office was leased some years before the present Commonwealth offices were available, and that actually relieved pressure on the then offices. It was considered reasonable not to disturb that arrangement.

They are the pertinent points in the letter. I want to know why there should be discrimination not only between members in one State but also between members in different States. If it is good enough for the honorable member for Swan (Mr. Cleaver) to have an office in his electorate, I say that it is good enough for the honorable member for Stirling to have an office in his electorate if he wants one there.

The conditions in regard to this matter are set out fairly clearly in a document issued by the Department of the Interior. I quote the instruction about this matter - No. 2 - which says -

It was decided that if accommodation were provided in a Member’s electorate, the only additional provision which would be made for him in the Capital Cities would be in a “ common room “. The Member would be under an obligation to nominate the location of the accommodation required for himself and his Secretary-Typist, i.e. in his electorate or in the Capital City of the State.

That is clear enough. That leaves it open for the member himself to nominate where he will have his office. Previously, when I was a member of this House, I had an office in my electorate; but when offices became available I was forced into the Federal Members’ Rooms. Since then the honorable member for Swan has had an office in bis electorate. I understand that he has had it since about 1955. The Minister says that that office was leased. Surely that lease has expired now. I- am not arguing that the honorable member for Swan should be forced to go into the Federal Members’ Rooms. Although an office is available there for him, I consider that he has the right to have an office in his own electorate. I say that if he is entitled to have his office in his own electorate, I also am entitled to have my office in my electorate.

Members from other States can please themselves where they have their offices. For instance, in New South Wales the honorable members for Barton (Mr. Reynolds), Hughes (Mr. L. R. Johnson), Blaxland (Mr. E. James Harrison) and St. George (Mr. Clay) have their offices in their electorates. They are metropolitan electorates, as is well known. In Queensland the honorable member for Griffith (Mr. Coutts) was advised that he could have his office in his electorate if he so desired; the honorable member for Petrie (Mr. O’Brien) has his office in his electorate; and, of course, as everybody knows, the honorable member for Lilley (Mr. Don Cameron) also has his office in his electorate. I want to quote from an article in the Sydney “Sun” of 28th February. It directed attention to the lavishness of the office of the honorable member for Lilley. It is not a reflection on the present member because the office was provided for the former member for Lilley prior to the present member being elected to this House.

Mr Duthie:

– What was the former member’s name?

Mr WEBB:

– I do not mention names, but his name is in the article if anybody wants to know. The article says -

The Minister for the Interior, Mr. Freeth, may soon be swamped with requests from private members for more lavish offices in their Federal electorates.

They will want them to be at least on the same princely scale as one completed for Mr. Bruce Wight in Albion, four miles from Brisbane Post Office, in readiness for him when he was expected to win the Federal seat of Lilley in the last election.

Mr Einfeld:

– What happened to him?

Mr WEBB:

– Everybody knows what happened to him. The article also says that, while other federal members stew in stuffy, poky offices, which they must share with their secretaries, the present member for Lilley has a lavish office that was provided for the previous member.

One of the points that was raised by the Minister was that the electorate of Stirling has no central point. If that is so, why is the federal electoral office for Stirling in the electorate? Surely that should be in the heart of the electorate. As the electoral office is in the Stirling electorate, I cannot see any reason why my office should not be there too, if I wish it to be there. I ask the Minister to have another look at this matter. I believe that it is very important that a member should have his office where he considers he can best do business for the people that he represents.

Mr JAMES:
Hunter

.- Mr. Speaker, I rise to support the honorable member for Newcastle (Mr. Jones). He asked why the Royal Australian Air Force does not use some of the vast area of land in the vicinity of the Williamtown air base as a bombing site, instead of using Morna Point at great inconvenience to the residents there. I can give this House information about tyrannical acts in the last twelve months by senior officers of the Air Force who do not understand that Australia is still a democracy and that the Air Force is maintained out of the purses of the Australian taxpayers to the extent of approximately £60,000,000.

Mr Killen:

– Those officers do not get about £3,000 a year.

Mr JAMES:

– If you keep coming in, I will deal with you. I notice that in the Air Force there is a considerable lack of public relations, in comparison with the other defence forces of the Army and the Navy.

Mr Killen:

– What do you suggest.

Mr JAMES:

– I have warned you once. The Air Force boasts publicly of its great public relations, but it does not put them into effect. The honorable member for Newcastle dealt very well with the numerous complaints made by residents in the vicinity of Morna Point. The Air Force regularly used Bird Island as a bombing site until about twelve months ago. As the honorable member for Newcastle said to-night, all sections of the community have lodged complaints about this matter.

I want to refer to a sad case that occurred late last year. A young boy from New Lambton, which I believe is in the electorate of the honorable member for Shortland (Mr. Griffith), went to the Morna Point bombing range one week-end and picked up an unexploded shell. He took it to his home in New Lambton. This sort of action can be expected of a young boy of ten or twelve years of age. The shell exploded and the boy lost his life. If the Air Force had continued to use Bird Island as the bombing range, this would not have happened.

I heard the honorable member for Moreton (Mr. Killen) praise a senior officer of the Air Force in this House one night. He praised him before the incident to which I have referred happened. The Darwin newspaper in the Library shows that the commanding officer there had received complaints similar to those that I have mentioned. The people of Darwin said that the Air Force should not use Fanny Bay as a bombing range. In reply to the complaints, the commanding officer made a press statement to the effect that the people knew this was a bombing range and should not have built their homes there. This attitude has the support of the Minister for Air (Mr. Bury), but it is not conducive to good relations between the community and the Air Force. After all, the taxpayers maintain the Air Force and I am damned if I can understand it.

Mr SPEAKER:

– Order! The honorable member will restrain himself.

Mr JAMES:

– So much for Fanny Bay and the Air Force there. Last year, the Cessnock Rotary Club sought permission for the parachutists from Williamtown air base to drop over Glenbawn dam at Scone to aid a charitable organization. The Air Force refused to co-operate, although this would have been a very simple operation for the parachutists. A senior member of the parachute unit, when visiting the Cessnock Rotary Club one night, told the Rotarians that if they wished to apply for the use of the parachutists to help a charitable organization, he felt sure permission would be granted, as he would recommend it. But then we get a tyrant again. In view of the invitation from the senior member of the parachute unit, the Cessnock Rotary Club applied for permission to have the parachutists give a display. A tyrant is a dreadful man in society. This man, drunk with power and not appreciating that the people still rule the country, though the Government learned this last December, wiped the application aside and no parachutists were permitted to give a display.

Mr Killen:

– What point are you making?

Mr JAMES:

– You are moving closer to it all the time. I have many friends in the Air Force and they are predominantly very decent men. However, every now and again a tyrant rises and refuses to permit an activity that would be very beneficial to the community and would aid public relations between the Air Force and the community. Quite recently a gathering of Christian men wanted permission to enter Rathmines air base. I have mentioned this air base in the House on previous occasions, but the Government has still done nothing to accede to the requests I have made. It has left many lovely cottages unoccupied there. They are being torn to pieces by vandals, while many people are in dire need of housing. However, returning to my point-

Mr Killen:

– What is it?

Mr JAMES:

– I think you are too dull to catch on. Recently, a certain organization sought permission to enter Rathmines air base. It was given authority to do so by the Senior Properly Officer of the

Department of the Interior, which controls almost all of the air base. However, the guards on the gate are paid by the Department of Air. The guards refused these people permission to enter the base and over-rode the authority given by the Senior Property Officer of the Department of the Interior. Naturally, this body of very reputable citizens was put to some inconvenience and was not sure whether it would be able to welcome its Sydney visitors on the following day. It was not until the eleventh hour that a senior officer of the Air Force at Williamtown changed his mind and gave permission for this gathering of Christian men to enter the Rathmines air base.

I have referred to a number of instances in which relations between certain officers of the Air Force and the community are bad. I hope that the Minister for Air, who was present in the House a short time ago when the honorable member for Newcastle put his case, will read my speech in “ Hansard “ to-morrow and will do something to improve public relations between certain officers of the Air Force and the community.

Mr COLLARD:
Kalgoorlie

.- I wish to refer to a matter that is disturbing the minds of quite a large number of people in Western Australia. It is the refusal of the Government to grant permission to the agents of Adler Translators to establish a trial or experimental television translator unit on Mount Bakewell. The agents claim that they can successfully, economically and and in a very short time relay television from Mount Bakewell to Kalgoorlie and the places between, and subsequently to Geraldton. If this can be done, it would mean that people in those areas would be able to enjoy the benefit of television many years before they would have the service from major stations.

In its issue of 9th March, the “ West Australian “ referred to an announcement by the Postmaster-General (Mr. Davidson). The relevant part of the newspaper item reads as follows: -

The TV expansion plans announced to-day mean that by the middle of 1964 Australia should have 87 television stations - nine of them in Western Australia.

The nine in Western Australia will include the two commercial stations and the national station in Perth and one commercial and one national station in each of the following three country areas: Bunbury, Katanning-Albany, and Northam- York.

By the middle of 1964, we could have nine television stations in Western Australia and still have approximately 27,000 people living beyond Merredin and up to and including Kalgoorlie and Boulder, and a similar number beyond about 60 miles from Perth and up to and including Geraldton, who will still be outside the viewing zone. People living at the most 350 miles from Perth and in some instances only about 80 miles from Perth will not have a television service. Not one house in the Kalgoorlie electorate, which covers about seveneighths of Western Australia, will be in the zone, so there will be nine television stations serving about one-eighth of the State. The Adler agents claim that in a very short time they could relay television to the 54,000 people in the areas I have mentioned. All they ask for is permission to establish this trial unit on Mount Bakewell, at no cost to the Government. Not only has the Government refused to grant permission but it has also declined to give its reasons for doing so either to the agents or to the public.

Naturally, as a result of the claim by the Adler agents and the refusal and’ silence of the Government, the people in the areas I have mentioned feel that they are being deprived unnecessarily of television services which could and should be made available to them. Several approaches have been made to the Postmaster-General, both by way of questions and correspondence, but he always seems to have a stock reply. He simply states that the Government has a certain plan which is working quite successfully. That reply is not satisfactory to the people concerned. They want to know why the Adler agents cannot get permission to set up the trial unit on Mount Bakewell, and why they must wait several years for television if, by the use of the Adler translators, it could be made available in a much shorter time. If there is a good’ and valid reason for refusing to allow the Adler agents to set up a unit on Mount Bakewell, the people should be told what it is. They should not be left guessing at the reason for what they consider to be the Government’s unreasonable attitude.

The people in the country areas and the goldfields area have very few amenities and forms of entertainment compared with the people in the metropolitan areas. The entertainments and the amenities that they have are largely the result of their own community efforts. Yet Perth, which already has two stations, soon will have another, which will be built at considerable cost. The country people of whom I speak have not been given even the satisfaction of knowing why they must wait so long for television when the Adler agents say that it could be provided in a very short time. 1 trust that the Government will take note of these few remarks which I have made and either give the Adler agents the green light to go ahead with the project or, if that is not possible, tell the people why this cannot be done. I have taken up this matter with the Adler agents, and for the information of honorable members I shall read some extracts from a letter dated 16th March, 1962, which they forwarded to me. They are as follows: -

It should be clearly understood in considering the problem that television coverage, unlike radio, is a “ line-of-sight “ affair. It does not travel around or through tall buildings or hills and depending upon the “ frequency channel “ of transmission the “ effective distance “ of reception is limited. Now, the terrain in Australia is so varied and areas vast that it would be impossible, even with the policy that is being followed or proposed by the Government, to reach people in many rural or fringe areas without translator stations, for surely there is no intention of establishing a major station throughout Australia every 40 or 50 miles!

The translators work on ultra high frequencies (UHF) and therefore do not interfere with or distort normal TV very high frequency (VHF) reception. Should by a trick of freak reception the normal transmissions be receivable in fringe areas, as has been the case in certain localities, the transmission from the translators would not cause any interference.

Since 1958 on behalf of CBS International we have made a lot of claims for this equipment and so far these remain undisputed by members of the technical staff of the A.B.C.B., some of whom have seen this equipment actually functioning while on overseas study trips.

One suggestion we made was that an experimental or trial unit be approved for establishment on Mount Bakewell near York. This has been rejected. In making these suggestions we had the full co-operation of the honorable the Premier,

Mr. David Brand, to utilize Crown land at the top of Mount Bakewell and also the co-operation of the State Electricity Commission to “ run-in “ free of cost the necessary power lines to service a transmitter. Mr. Peter Monger also agreed to allow us access to the area through his property.

So honorable members can see that there is no obstacle to the translators so far as Western Australia is concerned. Another extract is in these terms -

So far . . . we have not been able to obtain from the Postmaster-General or the A.B.C.B., or anyone else for that matter, one concrete reason or objection why the Adler system cannot be established here. There are no technical problems really that prevent the amenity of television being brought to the country folk within a few months instead of years and at a cost microscopic by comparison to the present policy of the A.B.C.B. which envisages an expenditure of around £500,000 for each station.

It is interesting to consider that the normal television station, such as TVW 7 here, is rated at 100 kilowatts or 100,000 watts at the aerial and they are having difficulty in transmitting satisfactorily 80 miles or so. On the other hand translator stations in various parts of the world are successfully carrying signals from 70 to 100 miles on power ratings one one-thousandth of the above power and at a capital cost of about one-tenth.

I also have in my possession articles which indicate that the Adler translators provide the only television service to more than 2,500,000 people in the United States. In addition, I have graphs which indicate the way in which the translator service is linked up to provide television at no cost to the stations. If this system works so well in other countries, there seems to be no reason why it should not work well in Western Australia. I repeat: If there is some reason why the Postmaster-General or the Government is not prepared to give the Adler agents the opportunity to erect this experimental unit, they should be at least courteous enough to tell the agents why permission is withheld and to tell the people concerned why they cannot have television.

Mr CHANEY:
Perth

.- I rise only to inform the honorable member for Kalgoorlie (Mr. Collard) that the PostmasterGeneral (Mr. Davidson) has asked me to state that he will take note of the honorable member’s remarks and consider them. He is not here because he is attending a rather important conference.

I move -

That the question be now put.

Question put. The House divided. (Mr. Speaker - Hon. Sir John McLeay.)

AYES: 60

NOES: 57

Majority . . 3

AYES

NOES

Question so resolved in the affirmative.

Original question resolved in the affirmative.

House adjourned at 12.2 a.m. (Thursday).

page 1892

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Industrial Arbitration

Mr Daly:

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

  1. Of the cases of union members listed as applicants for financial assistance at the direction of the Conciliation and Arbitration Court given in his reply to my question appearing in “ Hansard” (Vol. H. of R. 29, page 2433) of 26th October, 1960, what were the costs of the action in each case, and which of the applicants were awarded costs against the other party?
  2. What amount of costs was awarded in each case?
  3. Did any of the union members listed as applicants in fact claim financial assistance; if so, which were they, and what specific amount was determined and paid to each applicant or his legal advisers?
Mr McMahon:
LP

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

  1. The costs of action in each case are matters for the parties directly concerned. The only knowledge I have is where, in the event of an order having been made as to costs and, subsequently, a bill having been submitted, the Industrial Registrar has taxed the costs (see 2 below). With the exception of A. R. Auld, in whose case no order was made as to costs, and C. R. Cameron, on the occasion of that applicant’s second action when the respondent union was ordered to pay half the applicant’s costs, all the applicants were awarded costs, to be taxed by the Industrial Registrar, against the other parties, respectively.
  2. The amount of costs taxed by the Industrial Registrar in each case and, therefore, the amount of costs awarded, were -

No bill has been submitted to the Industrial Registrar by or on behalf of W. K. Spence and, accordingly, no costs have been taxed. Similarly, no bill has been submitted by or on behalf of C. R. Cameron in relation to that applicant’s second action.

  1. The only applicant to lodge a claim for financial assistance was C. R. Cameron in relation to his second action. Mr. Cameron sought, and obtained, advance financial assistance to the amount of £400. No further claim has been made on his behalf.

Soviet Embassy Press Releases

Sir Wilfrid Kent Hughes:
CHISHOLM, VICTORIA

asked the Minister for External Affairs, upon notice -

  1. Is it normal diplomatic practice for the Embassy of the Union of Soviet Socialist Republics to issue press releases consisting of untruths and half-truths about a friendly country in South-East Asia?
  2. Is he able to say whether this action is for the purpose of undermining the morale and poisoning the mind of the Australian people against the Government of that friendly country in order to assist the Communist aggression now taking place there?
  3. Does the Australian Government raise no objection to this pernicious form of propaganda?
Sir Garfield Barwick:
LP

– The answers to the honorable member’s questions are as follows: - 1 and 2. I assume that the question refers to a press release issued by the Embassy of the Union of the Soviet Socialist Republics on 27th March concerning the situation in South Vietnam. The press release in question appears to repeat a statement issued by the Soviet Ministry of Foreign Affairs. I believe that the great majority of Australians are aware of the aims of Communist propaganda and will not be misled by it. The Government agrees that externally-directed and supported Communist aggression is taking place against the Government and people of the Republic of Vietnam but is confident that this will be defeated.

  1. The Government regards the distribution of material expressing their Government’s point of view on international questions as an accepted function, though not a major function, of diplomatic and consular missions. The Government believes, however, that this material should observe the proprieties; it should not, for example, be in terms deliberately designed to be offensive to the Australian Government, to other governments with which Australia enjoys friendly relations, or to personalities; it should not contain falsehoods, gross inaccuracies, attributions of false motives, allegations of hypocrisy or be embarrassing to the Government in other ways. The Government is prepared to intervene when it considers that there has been a breach of these proprieties. It has conveyed its attitude on this matter to the Soviet Embassy.

United Nations Organization

Mr Griffiths:

s asked the Minister for External Affairs, upon notice -

  1. Is it a fact that a financial crisis is looming in the United Nations organization; if so, what has brought it about?
  2. How many nations have not met their financial obligations to that body and which are they?
  3. What amount is owing by each nation, and for what period is it owing?
  4. Have any member nations of the Security Council refused to pay their way; if so, which are they?
  5. Has Australia met her obligations; if so, how much has been paid each year?
  6. Has Australia made any contribution in excess of its normal commitments?
  7. Has Australia used its good offices to persuade defaulting nations to meet their obligations; if not, why not?
  8. Does Australia propose to support the admission of continental China to membership of the United Nations?
  9. If not, will the Government be prepared to consider such a proposal in the event of Nationalist China refusing to meet its commitments?
Sir Garfield Barwick:
LP

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

  1. The honorable member is referred to pages 2S1-2S4 of the report of the Australian Delegation on the first part of the Sixteenth Regular Session of the United Nations General Assembly, presented to the House on 20th February, 1962. 2 and 3. The information requested by the honorable member is contained in United Nations document ST/ADM/SER.B/157 which is available in the Parliamentary Library.
  2. No member of the Security Council has refused to pay its assessed share of the regular budget of the United Nations. The Union of Soviet Socialist Republics and Rumania are the only members of the Security Council which have refused to pay their assessed shares of the cost of United Nations operations in the Congo and of the United Nations Emergency Force in the Middle East. France has opposed United Nations intervention in the Congo and has not paid its assessed share of the Congo operations.
  3. Australia has fully paid all its contributions to the end of 1961 and will have completed payment in respect of the first half of 1962 by 30th June of this year. The amount of contributions to be paid each year varies according to (a) variations in the total budget and (b) variations in the percentage assessment, which is determined broadly upon relative capacity to pay. Contributions paid during financial year 1960-61 were -

During the current financial year 1961-62 we have paid the following amounts: -

In the additional estimates provision is being made for payment during this financial year of a further amount of £590,965, being the balance due in respect of the Congo operations up to 30th June, 1962.

  1. Yes. During the financial year 1960-61 Australia made a voluntary contribution of $750,000 (£334,931) to the United Nations Fund for the Congo. Australia has also contributed regularly to various extra-budgetary programmes of the United Nations which are financed on a voluntary basis such as: the Children’s Fund, Technical Assistance, and the programmes in aid of refugees. Australia in 1957 made a loan of $1,000,000 (£446,429) to the United Nations for clearance of the Suez Canal. In addition, as recently announced, Australia intends to purchase United Nations bonds in the amount of $4,000,000 (£1,786,000).
  2. Australia has always urged in the United Nations General Assembly, both in the Fifth Committee and in plenary meetings, that member Governments should pay their assessed contributions promptly. The Australian Government has lodged with the International Court of Justice a written statement containing a very substantial argument in favour of the proposition that the Soviet group of countries and others are bound to pay their assessed share of the cost of the United Nations peace-keeping operations in the Congo and in the Middle East, and will make an oral statement to the Court on this issue, the statement being presented by the Solicitor-General of the Commonwealth.
  3. The question at present is one of “seating” and not of the “ admission “ of continental China to membership. Australia does not propose to suggest any proposal which would seat continental China and expel Nationalist China from the United Nations.
  4. Since Nationalist China has not refused to meet its commitments, I do not intend to answer a hypothetical question of this kind.

South-East Asia.

Mr James:

s asked the Minister for External

Affairs, upon notice -

  1. In view of the undertaking of the United States Government to defend Thailand, as proclaimed in the communique’ of 6th March, 1962, at the end of negotiations between the Minister for External Affairs of Thailand, Mr. Khoman, and the United States Secretary of Slate, Mr. Rusk, could Australia, through her commitments under various alliances such as S.E.A.T.O. and A.N.Z.U.S., be led into military operations in this area?
  2. Would it be more expedient for Australia, under these circumstances, to leave S.E.A.T.O?
  3. When and where is the next session of the S.E.A.T.O. delegates to be held?
Sir Garfield Barwick:
LP

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

  1. The communique issued by the Secretary of State of the United Slates and the Foreign Minister of Thailand on 6th March, 1962, did not affect Australian obligations under the Manila Treaty. As I informed the member for Corangamite on 14th March in answer to a question on notice, the Government, at the appropriate time, will decide itself how it will perform its obligations under the treaty.
  2. No.
  3. The place and date of the next session of the S.E.A.T.O. Council will be announced by the Secretary-General in due course.

West New Guinea

Mr Whitlam:

m asked the Minister for Ex ternal Affairs, upon notice -

What is the text of the resolutions concerning West New Guinea against which Australia’s representatives have spoken or voted in the General Assembly or Political Committee of the United Nations?

Sir Garfield Barwick:
LP

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

Australian representatives to the United Nations have spoken and, with the exception of the first resolution listed below, voted against the following resolutions on the question of West New Guinea:

  1. Ninth Session of the General Assembly, 1954-

    1. Draft resolution submitted by Indonesia (A/C.1/L.109 of 23rd November, 1954). (This resolution was not put to the vote.)
    2. Joint draft resolution submitted by Argentina, Costa Rica, Cuba, Ecuador, El Salvador, India, Syria, and Yugoslavia (A/C.1/L.110 of 30th November, 1954).
  2. Eleventh Session of the General Assembly, 1956-57. Joint draft resolution submitted by Bolivia, Burma, Ceylon, Costa Rica, Ecuador, Ethiopia, India, Iraq, Pakistan, Saudi Arabia, Sudan, Syria and Yugoslavia (A/C.1/L.173 of 22nd February, 1957).
  3. Twelfth Session of the General Assembly, 1957. Joint draft resolution submitted by Afghanistan, Bolivia, Burma, Ceylon, Egypt, Ethiopia, India, Indonesia, Iraq, Jordan, Lebanon, Libya, Morocco, Nepal, Saudi Arabia, Sudan, Syria, Tunisia and Yemen (A/C.1/L.193 of 19th November, 1957).
  4. Sixteenth Session of the General Assembly, 1961. Joint draft resolution submitted by Bolivia, Congo (Leopoldville), Guinea, India, Liberia, Mali, Nepal, Syria and United Arab Republic (A/L.367/Rev. 1 of 27 November, 1961).

The text of these resolutions is held in the United Nations Records Section of the National Library.

Exports

Mr Ward:

d asked the Minister for Trade, upon notice -

  1. Did the Export Development Council in reporting on “ Australian Export Trends and Prospects” in 1959 state that over the next five years Australia’s export income would be required to expand substantially, perhaps by as much as £250,000,000, if continued balance of payments difficulties were to be avoided?
  2. If so, will he, after making allowance for the depreciation which has since occurred in the value of Australian currency, state what progress has been made towards this objective?
Mr McEwen:
CP

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

  1. Yes.
  2. Actual values of exports rose by £158,000,000 from £811,000,000 in 1958-59, to £969,000,000 in 1960-61. In the six months, July to December, 1961, they were running at an annual rate of £261,000,000 above the 1958-59 level. Based on movements shown by the Commonwealth Statistician’s Index of Export Values at Constant Prices, the corresponding rises in exports expressed in constant 1958-59 prices are estimated to be £97,000.000 and £187,000,000, respectively.

Beef Industry

Mr Coutts:

s asked the Minister for Trade, upon notice -

  1. Will the Minister give an estimate of the adverse effect on employment in the slaughtering and production sections of the beef industry if the recommendations of the American National Cattlemen’s Association to the United States Government regarding the importation of beef are adopted?
  2. As Queensland is the principal beef exporting State, will the Minister, in the interests of that State, press the case with the United States Government for the retention of existing tariff conditions and rates?
Mr McEwen:
CP

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

  1. and 2. If increased protection were to be provided for the U.S. beef industry, either by quantitative restrictions or higher tariffs, the effect on the Australian beef industry would be most serious. The U.S. is easily our largest beef market, taking some 64 per cent, by value of Australian beef exports to all countries. In 1960-61 the value of these exports to the U.S. market totalled almost £26,000,000. On the other hand our exports to the U.S. represent only a little more than 1 per cent, of total U.S. beef consumption (in fact total imports represent only about 3 per cent, of U.S. consumption) and it would be hard to see how this could constitute any real problem to the domestic U.S. industry. As to the likelihood of restrictions being placed on our beef exports to the U.S. as a result of the statement by the American Cattlemen’s Association, I should explain that this statement was not a formal request for additional protection. It was one of some hundreds of statements by witnesses expressing views to the Ways and Means Committee of the U.S. House of Representatives on a bill presented by the U.S. Administration on the question of the President’s powers to negotiate tariff concessions with other countries.

Australian Exports to the United Kingdom.

Mr Ward:

d asked the Minister for Trade, upon notice -

  1. By what percentage did Australian exports to the United Kingdom rise or fall in 1961?
  2. Is he able to say what percentage of the total imports into the United Kingdom in 1961 was the production of Australian industries?
Mr McEwen:
CP

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

  1. The total value of Australia’s exports to the United Kingdom fell by 15.9 per cent, between 1960 and 1961. However, exports of bullion and specie (mainly gold) to the United Kingdom amounted to £5,000,000 in 1961 as against £37,000,000 in 1960. Merchandise exports, which exclude these items, fell by 3.6 per cent, from 1960 to 1961.
  2. United Kingdom trade statistics show that, in 1961, 4.0 per cent of total imports were obtained from Australia. This does not take account of Australian produce imported into other countries and subsequently exported to the United Kingdom after further processing. Trade statistics do not show, for example, the value of Australian wool contained in textiles imported into the United Kingdom from other countries.

Trade With New Zealand

Mr Hayden:

n asked the Minister for Trade, upon notice -

  1. Does the Government intend to act on a recent suggestion by the Premier of Victoria that tariffs and controls on imports from New Zealand should be abolished in order that that country may acquit its trade deficit with Australia?
  2. If so, will he give an assurance that the dairying and agricultural industries, particularly the onion industry, will be protected from imports of New Zealand produce?
Mr McEwen:
CP

– The answers to the honorable member’s questions are as follows: - 1 and 2. The Government does not intend to adopt the suggestion that tariffs and controls on imports from New Zealand should be abolished.

Imports

Mr Duthie:

e asked the Minister for Trade, upon notice -

  1. What has been the value of Australia’s imports from (a) West Germany, (b) Holland, (c) Belgium, (d) the United Kingdom, (e) Luxembourg, (0 France and (g) Italy during each of the years from 1957-58 to 1960-61?
  2. What has been the value of Australia’s exports to each of these countries during the same years?
Mr McEwen:
CP

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

The Commonwealth Statistician advises that Australia’s imports from and exports to the

Federal Republic of Germany, Netherlands, Belgium-Luxembourg, the United Kingdom,

France and Italy during each of the years 1957-58 to 1960-61 were as follows:-

Property Agreement

Mr Ward:

d asked the Minister for the Interior, upon notice -

  1. Will he make available, for the information of honorable members, a copy of the agreement entered into by the Commonwealth of Australia, the Myer Emporium Limited, and Barclay Investments Proprietary Limited, owners of contiguous property, regarding the use of Angelo-lane, which is located between the Chief Telegraph Office, Post Office-place, Melbourne, and the Myer Emporium, and for which there is no registered owner?
  2. Is it a fact that the Bourke-street end of the laneway has been enclosed as part of the Myer Emporium building and a gate placed at the Little Bourke-street end which is kept locked except during business hours?
  3. Will he have prepared and make available a statement enumerating the benefits derived under the agreement by the three signatories?
Mr Freeth:
LP

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

  1. A copy of each of three agreements between the Commonwealth and the companies concerned will be available to honorable members in the Library.
  2. Yes.
  3. In each of the three agreements it is recited that Angelo-lane is a private lane and is controlled and maintained as a private lane by the Commonwealth and the companies for their mutual benefit, and that the Commonwealth and the companies have easements of way through over and along Angelo-lane. Incidental benefits to the Commonwealth arising from the easements are - (i) joint control and management as to maintaining the lane in good repair, clean weatherproof order and condition; (ii) easy access and nil obstruction to ventilating ducts in the side of the Commonwealth-owned building; (iii) light, air and drainage facilities and also right of carriageway for vehicular traffic and personnel; (iv) easy access for any necessary structural alterations to the Commonwealth’s property; (v) joint control and management over unauthorized vendors and hawkers causing congestion and interrupted use over and along the lane during normal business hours; (vi) minimum risk to the unauthorized entry and repair of the Commonwealth’s property by vandals and undesirables outside normal business hours.

Commonwealth Offices, Brisbane

Mr Cross:
BRISBANE. QLD

s asked the Minister for the Interior, upon notice -

  1. What Commonwealth departments in the city of Brisbane are located in premises rented from the State Government or from private owners?
  2. What is the amount of floor space involved?
  3. Will the Government proceed with the completion of the Commonwealth Offices building adjacent to Anzac Square?
  4. Has the Government a building programme for Brisbane designed to accommodate all

Commonwealth departments in governmentowned premises?

Mr Freeth:
LP

– The answers to the honorable member’s questions are as follows: - 1 and 2. No Commonwealth departments in Brisbane are located in premises rented from the State Government. Departments occupying space leased from private owners and the amount of space leased are as follows: -

  1. No decision has been taken by the Government on this question.
  2. No.

Canberra Swimming Fools

Mr J R Fraser:
ALP

ser asked the Minister for the Interior, upon notice -

  1. Has the National Capital Development Commission indicated that it has funds available for the heating of a Canberra swimming pool?
  2. Will this money be applied without delay to the heating of the main pool at the Olympic Pool at Canberra City?
  3. What plans have been drawn up for the construction of additional swimming pools to serve the expanding suburbs of Canberra?
  4. Can he say where and when new pools will be provided?
Mr Freeth:
LP

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

  1. No.
  2. Since the answer to question No. 1 is “ No “ this question does not arise. 3 and 4. The commission has investigated sites and included additional pools in its programme, but the implementation of such a programme is a matter of government policy dependent on the allocation of funds in annual budgets.

Sulphate of Ammonia.

Mr Fairhall:
LP

l. - On 5th April, the honorable member for Richmond (Mr. Anthony) referred to the Government’s decision to pay a bounty of £2 per ton on the Australian production of sulphate of ammonia and asked whether the temporary duties on imported urea and ammonium sulphate would be automatically abolished and unrestricted importation be permitted and, if so, whether primary producers would benefit from a price reduction on the goods.

The temporary duties on urea, sulphate of ammonia and other synthetic nitrogenous fertilizers were removed from 5th April, 1962. There are no restrictions on the importation of nitrogenous fertilizers. The removal of the temporary duties and the introduction of the bounty on sulphate of ammonia should lead to price reductions. The Government would expect that the price of sulphate of ammonia, for example, should fall by at least £2 per ton.

Education.

Mr Menzies:
LP

s. - On 3rd April the honorable member for Yarra (Mr. Cairns) asked a question without notice based on a statement by the Victorian Minister for Education giving the number of qualified persons applying for admission to Melbourne and Monash universities and the number of such persons admitted.

I made inquiry of the chairman of the Australian Universities Commission who supplied me with some information on the matter, including a copy of the statement of the Minister for Education. That statement gave only the total number of qualified persons who applied on the joint application form used by both universities, for admission to Melbourne and Monash universities this year (a gross figure), and the number of persons who have been admitted. The respective figures were 5,054 and 3,290. The Minister did not interpret these figures to mean, as conveyed by the honorable member for Yarra, that “ of those who applied for admission to Victorian universities and were qualified, only 65 per cent, were able to obtain admission this year “; in fact, he said that he was “disregarding those applications which have been or may be withdrawn”. The number of such withdrawals is not yet known but a detailed analysis of the 5,054 qualified persons who applied for admission to one or other of the universities is now being made by the University of Melbourne. This analysis, which will not be available before June, should provide information on how many students were in fact rejected because of limits placed on enrolments by the University of Melbourne and Monash University.

Wilh regard to the position in other States, I would refer the honorable member to my reply to a question by the honorable member for Wills (Mr. Bryant) in “ Hansard “ of 1st May, 1962, on page 1796.

As to the last part of the honorable member’s question, we are doing, in conjunction with the States, all that is possible to supply adequate university facilities throughout Australia. The honorable member’s question implied that accommodation was the crucial factor in limiting admission to universities; but one of the acutest present limitations is that of supply of staff a problem which in the short term is not readily overcome, and certainly not merely by providing more finance.

Employment of Aborigines in the Northern Territory.

Mr Ward:

asked the Minister for Territories, upon notice -

  1. How are wage rates and conditions of employment determined for aborigines resident in the Northern Territory?
  2. What is the minimum wage paid?
  3. What is the maximum number of hours in the working week?
  4. Is any provision made for the working of overtime?
  5. If so, is there a limit to the hours that may bc worked, and what is the basis upon which the rale of pay for overtime work is determined?
  6. What are the conditions of employment, including wage rates, in the case of aborigines employed by the Administration?
Mr Hasluck:
Minister for Territories · CURTIN, WESTERN AUSTRALIA · LP

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

  1. Wage rates for aborigines who have been declared to be wards under the Northern Territory Welfare Ordinance 1953-1960 and who are not employed under normal award conditions are determined by the Administrator of the Northern Territory under the power conferred upon him by the Wards’ Employment Ordinance 1953-60. Their conditions of employment are determined by the Administrator-in-Council in accordance with the power conferred upon him by the Ward’s Employment Ordinance 1953-1960. Wage rates and conditions of employment for aborigines who are not wards and for those wards who are employed under award conditions, are determined in the same manner as are those for other workers in the community. Where certain industries or occupations are award free, wage rates are set by the custom in the industry or occupation and may vary from time to time with the supply and demand for labour.
  2. In the case of wards not employed under award conditions, the minimum cash wages prescribed for their employment in various industries are as follows: -

The minimum cash wages prescribed are in addition to the food, clothing, accommodation, &c, which an employer is required to provide for his ward employee, and, if applicable, for his wife and one child. The value of this food, clothing, accommodation, &c, is estimated at £3 12s. per week for a single employee and £8 19s. per week for a married employee, wife and one child. In the case of non-wards and wards who are employed under award conditions, the minimum wage paid is that prescribed in the award for the industry in which they are employed. The case of award-free industries has been covered under 1. 3 and 4. Where there is an award or industrial agreement providing for the ordinary working hours and working of overtime by persons employed in an industry,, the provisions of (hat award or industrial agreement relating to ordinary working hours and overtime apply to wards employed in that industry. Where there is no award or industrial agreement providing for the ordinary working hours and working of overtime by persons employed in an industry, the Director of Welfare may, having regard to the ordinary working hours and the existing conditions under which overtime is worked in that industry, determine the ordinary working hours of wards and conditions under which wards may be required to work overtime in that industry. In the case of award-free industries, policy has been to require that hours and overtime payments for wards should be the same or on the same basis as for other workers in the same industry. The maximum number of hours in the working week and the provisions for the working of overtime for non-wards and those wards employed under award conditions are as prescribed in the industrial awards for various industries.

  1. The general limit on working hours prescribed in the majority of Northern Territory awards is 40 hours a week. The cattle station industry award (Northern Territory) prescribes a variety of hours for different classifications, e.g. some employees are on 40 hours, some on 44 hours and for others, e.g. stockmen, there is no prescribed maximum under the award. As stated in the answer to questions 3 and 4 the basis upon which the rate of pay for overtime work is determined is that specified in the relevant industrial awards or in the case of award-free industries, on the basis of the generally prevailing rate i.e. generally at the rate of time and a half with the exception that all work done on Saturdays and/or Sundays and public holidays is paid for at the rate of double time.
  2. Present conditions of employment for male wards employed by the Administration other than those employed under award conditions, provide for a minimum payment of £3 10s. per week plus food, tobacco, accommodation and clothing for self and also for family if married. This minimum rate is not a standard and the wages actually paid are related to the skills and experience of the ward and the duties of the position in which he is employed. These conditions do not apply to police trackers (who are paid £3 per week plus maintenance of family, &c.) or, because of their special circumstances, to wards employed by the Welfare Branch on government settlements.

Papua and Nev? Guinea

Mr O’Brien:
PETRIE, QUEENSLAND

n asked the Minister for Territories, upon notice -

  1. What are the names, places of birth and dates of the appointment of nurses of (a) European and (b) Asian extraction currently employed at hospitals within the Territory of Papua and New Guinea?
  2. Which of these nurses in each category are in receipt of expatriate allowances and higher rate of recreation leave and sick leave?
Mr Hasluck:
LP

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

  1. There is a total of 189 persons of European or Asian extraction employed by the Papua and New Guinea Administration in the professional nursing field. Of this total 187 persons are of European extraction, most of them born in Australia, and two of Asian extraction, both born in the territory.
  2. All of the 187 persons of European extraction are employed under expatriate conditions of service. The two persons of Asian extraction are temporary employees and do not receive expatriate conditions. The list of employees and details covering birthplace and appointment will be placed on the Library table for information of honorable members.

Medical Benefits Scheme

Mr Cairns:

s asked the Minister representing the Minister for Health, upon notice -

  1. How many organizations participating in the medical benefits scheme were registered under the National Health Act at 1st January and 1st July in each of the years from 1951 to 1961?
  2. What were the receipts of these organizations in each of these years from (a) the Commonwealth Government and (b) persons insured with them?
  3. What were the payments by these organizations in each of these years to (a) persons insured with them and (b) hospitals?
  4. What were the costs of running these organizations in each of these years?
Mr Swartz:
LP

– The Minister for Health has furnished the following reply: -

  1. The medical benefits scheme commenced operating on 1st July, 1953. The number of registered medical benefits organizations participating in the years up to 1961 are -
  2. Tn the years 1953-54 to 1960-61, receipts by registered medical benefits organizations from the Commonwealth and persons insured wilh them were -
  1. Total payments, including Commonwealth benefit, by these registered medical benefits organizations to persons insured with them were -

There were no payments by registered medical benefits organizations to hospitals.

  1. The management expenses of these organizations in each of the years were -

Social Services

Mr Griffiths:

s asked the Minister for Social Services, upon notice -

  1. Has any change taken place since the advent of the merged income means test in March, 1961, in the manner in which an age or widow pensioner is permitted to earn the £182 which is allowed under the means test?
  2. Can it be earned in any multiple of months within the twelve months of a- year, or is it to be earned over the period of 52 weeks at the rate of £3 10s. a week?
Mr Roberton:
CP

– The answers to the honorable member’s questions are as follows: - 1 <

  1. There has been no change in policy affecting pensioners who have been in the habit of earning £182 a year and no more.
  2. A pensioner may have income from casual employment at any rate per week to bring his means as assessed up to £182 without prejudice to his rate of pension. However, when a pensioner has brought his means as assessed to £182 and remains in employment, or having relinquished employment again commences to earn, his pension must be assessed on the basis of his current means as assessed.
Mr Griffiths:

s asked the Minister for Social Services, upon notice -

  1. In what circumstances does income received from the home of a pensioner, which is his permanent place of residence, become the subject of the income from property means test?
  2. What percentage of beard paid to a pensioner by a boarder is regarded as income? .
  3. How many lodgers can a pensioner accommodate in his home without reduction of pension?
  4. Are rooms occupied by lodgers measured by his department in assessing the value of that part of a pensioner’s home which is not considered to be his place of residence?
  5. What constitutes a flat in the home of a pensioner which is the pensioner’s permanent place of residence?
Mr Roberton:
CP

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

  1. Nothing is taken into account for pension purposes as income received from a pensioner’s permanent place of residence which is wholly occupied by him as his home. See answer to 3 and 4.
  2. Ten per cent, where bed and breakfast are provided and 20 per cent, where additional meals are provided. 3 and 4. If a pensioner conducts a lodging house as a business on premises in which he also resides the value of the property set aside for business purposes is taken into account in the pension assessment. The question of whether a business is being conducted is looked at if the number of lodgers exceeds five.
  3. That portion of the dwelling that is the exclusive home of the tenant. In general, where the pensioner shares all domestic facilities such as cooking, ablution and laundry with the tenants the view is taken that the tenants are lodge where, however, the tenant has for his exclusive use other premises, more particularly a kitchen, in addition to his sleeping accommodation, the department considers the whole nature of the premises exclusively occupied by the tenant to see whether it should not be regarded as the home of the tenant rather than the home of the pensioner. The department bases its decision on whether premises constitute the pensioner’s home, on the practical test, “ Is the house or part of the house in fact the permanent residence of the claimant or pensioner? “ This test is based on advice received from the Crown Law authorities.
Mr Webb:

b asked the Minister for Social Services, upon notice -

As a telephone rental of £14 7s. 6d. a year is a heavy financial burden on a pensioner who requires this facility, will he consider supplying telephones to pensioners on a rent-free basis?

Mr Roberton:
CP

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

There is no provision in the acts administered by me under which rentals of pensioners’ telephones could be met from funds provided for social services. It is more appropriate to consider questions of this nature when the Government is framing its Budget proposals.

Mr Webb:

b asked the Minister for Social Services, upon notice -

In a case where the wife of an age pensioner has not yet reached the age of 60 years will he consider making a provision for the wife to receive a pension equivalent to the age pension?

Mr Roberton:
CP

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

There is already provision in the Social Services Act for the payment of an allowance to the wife of an age pensioner if he is permanently incapacitated for work. Apart from this, if the wife of an age pensioner is permanently incapacitated for work, or blind, she may receive an invalid pension before she reaches 60 years of age.

Successive Governments have taken the view that a pensioners wife should not be granted a pension merely because her husband is a pensioner and she has not attained the qualifying age of 60 years.

Nuclear Weapons.

Mr Whitlam:

m asked the Minister for

External Affairs, upon notice -

With what Commonwealth or South-East Asia Treaty Organization countries did Australia consult before he sent his reply to the letter of 2nd January, 1962, from the Acting Secretary-General of the United Nations on manufacturing and receiving nuclear weapons’?

Sir Garfield Barwick:
LP

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

The Australian Government exchanged views with a number of Commonwealth, South-East Asia Treaty Organization and other friendly countries before replying to the inquiry by the Acting SecretaryGeneral of the United Nations under General Assembly Resolution 1664 (XVI).

The Government had already had the benefit of the debates in the United Nations on this resolution and on others concerning the use and dissemination of nuclear weapons. In these debates the attitude of many members, including Commonwealth and Seato members, were clearly expressed.

Joint Committee on Foreign Affairs.

Mr Ward:

d asked the Minister for External Affairs, upon notice -

  1. When was the Joint Committee on Foreign Affairs first appointed?
  2. What has been the total expenditure in each year since the committee came into existence in respect of (a) sitting allowances, (b) travelling expenses, secretarial assistance and (d) miscellaneous expenses?
  3. What places have been visited by the committee in the course of its inquiries?
  4. On what matters has the committee reported to the Parliament?
Sir Garfield Barwick:
LP

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

  1. The Joint Committee on Foreign Affairs was first appointed on 27th February, 1952.
  2. Members of the committee receive the same allowances as members of other joint parliamentary committees, viz. - a sitting allowance of £2 10s. per day, and a travelling allowance of £4 (the same as the sessional travelling allowance but not in addition thereto) and £4 4s. per day outside Canberra. Other expenses incurred are for members’ travel, occasional travel expenses for “ staff “ and witnesses, and minor incidental expenses such as stationery and maps. The committee’s staff consists of its secretary, a permanent officer of the Department of the Senate; its liaison officer, a permanent officer of the Department of External Affairs. No costs to the committee are therefore involved in these officers’ salaries. Some expense is incurred, however, in the employment of a stenographer, on part-time duties. Total expenditure in each year since the committee came into existence is as follows: -
  1. Sydney, Melbourne and Perth.
  2. Under the terms of the resolution constituting the committee, “ the committee shall, for considerations of national security, in all cases forward its reports to the Minister for External Affairs, but On every occasion when the committee forwards a report to the Minister it shall inform the Parliament that it has so reported; except that in the case of matters not referred to it by the Minister tor External Affairs, the committee shall not submit a report to the Minister nor inform the Parliament accordingly without the Minister’s content.” Following upon discussions and investiga tions by the full committee and its sub-committees, the committee has submitted many resolutions and advices to the Minister through the chairman and held a number of discussions upon these findings with the Minister himself in full committee. The committee has presented reports to theParliament and/or reported that it has submitted reports to the Minister on the following subjects: -

Peking peace conference.

Committee’s activities and functions.

Jndo-China.

Extradition treaties.

Nuclear Tests

Mr Cairns:

s asked the Minister for Exter nal Affairs, upon notice -

  1. Has his attention been drawn to a statement made by the Secretary for Defence in the United States of America that his country would not suffer any military disadvantage if it did not recommence atmospheric nuclear tests?
  2. Is he able to say whether the British Government has provided the United States authorities with evidence that even small underground nuclear tests conducted by the United Stales have been detected in Britain?
Sir Garfield Barwick:
LP

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

  1. It is not clear to me what statement the honorable member has in mind. If he is referring to the testimony of Mr. McNamara before the Armed Services Committee of the United States House of Representatives which was published last month, I should like to make clear to the honorable member that the Secretary of Defence was answering a charge that the United States Government had failed in its duty by agreeing to an unpoliced moratorium during which the Soviet Union had prepared a massive series of tests. Mr. McNamara said that he did not agree with the view that that series of tests had put the Soviet Union ahead of the West. This, of course, is not at all the same thing as claiming that the United States would suffer no military disadvantage if it did not resume atmospheric testing in present circumstances. I am not aware that Mr. McNamara has ever made such a claim. On the contrary, on 8th March, in a statement following President Kennedy’s announcement of his decision to authorize’ a resumption of atmospheric testing, the Secretary of Defence said -

The implications of a United States selfimposed moratorium on atmospheric testing, in the light of present and past Soviet actions, are quite clear. It would only be a matter of time before the present powerful United States nuclear strategic advantages would begin to diminish in relation to Soviet force capabilities and might ultimately shift in favour of the U.S.S.R.

Mr. McNamara went on to say

  1. . since the actual high altitude physical environment cannot be duplicated below ground, it was recognised that on the basis of technical developments in nuclear weaponry, the United States under the present conditions had no alternative but to proceed with an atmospheric test programme.

    1. I know of no such advice. In any event the major problem has always been that of identification. That is to say, of determining whether a detected event was caused by a nuclear explosion or by a natural seismic disturbance. Nothing that I have seen indicates that the British Government considers that this problem can be overcome without verification by on site inspection.

Cite as: Australia, House of Representatives, Debates, 2 May 1962, viewed 22 October 2017, <http://historichansard.net/hofreps/1962/19620502_reps_24_hor35/>.

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