House of Representatives
26 August 1964

25th Parliament · 1st Session

Mr. DEPUTY SPEAKER (Mr. Lucock) took the chair at 2.30 p.m., and read prayers.

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Social Services

Dr. J. F. CAIRNS presented a petition from certain electors of the Commonwealth praying that the Commonwealth Government immediately grant a basic pension rate of £8 10s. per week, formulate a national housing plan for low rental homes for pensioners and provide all pensioners within the permissible income with the medical entitlement card.

Petition received and read.

Nuclear Tests

Mr. L. R. JOHNSON presented a petition from certain electors of the Commonwealth praying that the Commonwealth Government (1) instruct its representative at the United Nations to condemn the French Government’s proposal to test nuclear weapons in the Pacific, (2) again protest directly to the French Government with a view to cancellation of the tests and (3) use all appropriate means at its disposal to obtain an extension to the treaty to cover underground tests.

Petition received and read.

A similar petition was presented by Mr. Killen.

Petition received.

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– Will the Minister for Repatriation inform the House what progress has been made in training medical undergraduates at the Repatriation General Hospital at Concord, Sydney? At whose request was this scheme begun?

Minister for Repatriation · DARLING DOWNS, QUEENSLAND · LP

– The Repatriation General Hospital at Concord was reestablished as a teaching hospital last year at the request of the University of Sydney. At present, 40 undergraduates are studying under this scheme. I expect that the number will rise to 72 by the year 1966 and will probably increase in later years. The course includes clinical studies in medicine and in surgery. The most modern, equipment is available for this work. It may interest the

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F.9346/64.- -R.]

honorable member to know that the Repatriation General Hospital at Concord is now connected through the land-line network arranged by the Postgraduate Committee in Medicine from the University of Sydney. Through this particular system, lectures are obtained from other hospitals in Australia and seminars, and recorded lectures are also available from the United Kingdom and the United States of America. The success of this teaching hospital at Concord is, I think, indicative of the high standard of the medical service provided by the Repatriation Department.

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– My question is directed to the Minister for Repatriation. In view of the keen disappointment of many ex-servicemen whose claims for repatriation benefits have been rejected, I ask the Minister whether he will make an unequivocal statement as a directive to the Repatriation Department that the onus of proof clause in the Repatriation Act requires his Department to prove its determination rather than the applicant proving the cause of his war caused disability?


– The honorable member is probably aware that the determinations are made by certain authorities and not by the Repatriation Department itself. In the first place, when an application is made, the Repatriation Board in each State has the responsibility for examining the claim and for giving a decision in relation to it. The applicant has the right of appeal against the decision of the Repatriation Board to the Repatriation Commission where the claim is again examined. There is a further right of appeal from the decision of the Repatriation Commission to a War Pensions Entitlement Appeal Tribunal. All these particular authorities are fully aware of their responsibilities under the Repatriation Act. As the House is also equally aware, Section 47 of the Act makes it quite clear that if there is any doubt at all in the minds of the various determining authorities they must resolve that doubt in favour of the applicant. I am quite sure that this matter is raised continuously. I have continuous contact through my Department with the authorities concerned. I am quite convinced that those authorities are fully aware of their responsibilities under the Act.

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Sir Wilfrid Kent Hughes:

– I ask the Minister for Primary Industry whether it is true, as was reported in the Press, that the Australian Wheat Board is selling wheat to India, a very friendly country, on six months terms. If this is so, will he ask the Wheat Board, if he does not know the reason, why we are giving India only one half or one third of the length of time for repayment that we gave to Communist China, and will he inform the House of the results of his inquiry?

Minister for Primary Industry · FISHER, QUEENSLAND · CP

– Quite recently India asked the Wheat Board whether it had supplies of wheat available that could be delivered in August and September of this year. The Wheat Board replied that it could help in this direction, and a sale was negotiated. The credit terms agreed to were those requested by India. I think it is a quite satisfactory arrangement.



– I ask the Minister for Shipping and Transport whether he has seen the comparisons worked out by Mr. D. D. Willis, the Secretary of the Hobart Chamber of Commerce, concerning the fares fixed by the Australian National Line for the “ Empress of Australia “. Mr. Willis claims that it would be cheaper to fly to northern Tasmania, in particular, and hire a car there than to bring a vehicle across on the “Empress of Australia”. If this is so, will the Australian National Line be prepared to have another look at the fares, with a view to bringing them within the economic capacity of the rank and file of the Australian people, not just the wealthier section of the community? Would it not be better economic sense to cater for full passenger loads on every trip at a fare which is competitive with airways charges than to have the ship only partly loaded with passengers paying higher fares?

Minister for Shipping and Transport · FORREST, WESTERN AUSTRALIA · LP

– I have not seen the comparison of figures to which the honorable gentleman refers, but I know there has been some criticism of the schedule of fares prepared by the Australian National Line. Those fares are based on a judgment of the economics of the voyage schedules of the “ Empress of Australia “ and upon a business judgment. As honorable members know, the Australian National Line has been set up to operate in such a way as to indicate whether there are commercial possibilities for shipping on the Australian coast. If there are no commercial possibilities, there is not much hope in the future for shipping services on the Australian coast. I would not interfere with the fares which the Australian National Line proposes to charge until we have had some experience of the running of the “ Empress of Australia “.

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– In addressing a question to the Minister for National Development, I refer to the fact that there have been allegations that Australia’s natural forests are being denuded of timber at a rate faster than normal regrowth. Can the Minister inform the House whether any steps are being taken to avoid possible future shortages of building materials by the establishment of forest plantations?

Minister for National Development · FARRER, NEW SOUTH WALES · LP

– At the present time, Australia imports about one third of the timber that she uses. This costs something like £80 million a year. Next to oil, timber is the primary product of which we import most. Last Friday we set up the Australian Forestry Council, a body comprising the State Ministers for Forests, the Commonwealth Minister for Territories and myself. One of the first things that we decided at the meeting was that we should set out . a programme that would make Australia eventually completely self-sufficient in timber. It was estimated that this would require the planting of about 75,000 acres of soft woods a year. At present I think we are planting about 41,000 acres a year. .It was decided to ask the Standing Committee of the Forestry Council to suggest means by which planting could be stepped up. The recommendations will be put to the Council, and I hope that some practicable means can be found. I point out that in the meantime the States are using various methods to increase their planting, and we hope that eventually this will make Australia selfsufficient in timber.

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– I preface my question to the Minister for Housing by drawing his attention to a newspaper article which states that the Commonwealth Government has received more than 3.000 applications for home savings grants and has paid out £223,000 at an average of £242 a grant. As this rate is less than one successful applicant for every three applications, can the Minister inform the House whether this ratio is general and, if so, what are the chief reasons for so few applicants receiving the subsidy?

Minister for Housing · WENTWORTH, NEW SOUTH WALES · LP

– The figures cited by the honorable member are, by now, somewhat out of date. The reason that some applications have not gone through as quickly as one might have hoped is that they have not been accompanied by some of the necessary documents. In many cases, references had to be made back to the applicants and this, of course, takes time. However, the lag of approvals as against applications is diminishing and I am sure that, as the scheme becomes better understood, particularly by the banks and other officials who may be concerned, the time taken will steadily diminish. Delays, so far, have been caused largely by people who have not supplied all the requisite information.

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– My question is directed to the Minister for Primary Industry. The Minister will be aware that because of a huge record crop of apples, difficulty was experienced at the outset of last season in obtaining sufficient shipping space to export the record quantities. Can the Minister say whether, as indicated in the current interim report of the Australian Apple and Pear Board, negotiations are proceeding with shipping companies? Have any meetings been held? Does the Minister expect to be able to give some information on progress at a reasonably early date?


– Negotiations concerning the shipment of apples and pears were satisfactorily concluded last season in that ships were available for the total crop, although some of the ships required were secured by charter. Even the freight rates on the chartered ships were settled satisfactorily which was contrary to what had been expected in the first instance. Negotiations are still proceeding between the Apple and Pear Board and the shipping companies, and there is to be another meeting in October in the hope of finalising arrangements for the forthcoming crop.

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– I direct a question to the Minister for Housing. To what extent has the price of the average home risen as a direct result of recent tariff and price increases in timber? Does the aggregate of these increases approximate £250 per home, which is the maximum advance under the home subsidy scheme? Do these increases mean that home subsidies paid to young couples have been substantially offset and represent no real advantage to the people concerned?


– It is true that, recently, the duty on imported timber was increased, but this happened to coincide with a general increase in prices of timber, particularly Oregon which is one of the main materials imported for housebuilding. The general increase which lifted the price of timber was very much greater than the increase in duty which I understand has had only a relatively minor effect. There has, of course, been an increase in the cost of housing. In part, this has been due to the cost of timber, but only in small part. There are many other factors which have influenced housing costs. One, inevitably, is the rise in wages - not only in the basic wage, but in the average wage. A very large part of the cost of a house is the direct labour cost, and it is inevitable that the price of housing will rise with increases in labour costs as with increases in the cost of other factors affecting building. In addition, when there is general prosperity and a higher demand for almost everything, prices go up. This has no connection with the grant of £250. Any increase in costs took place very largely before the first £250 was paid out. But I would like to point out that this £250 is important, not so much in connection with the total cost of the house but rather because it helps the purchaser to raise the deposit that he is required to put down on the house. If, for example, there is a 10 per cent, increase in the prices of houses, the amount of deposit required does not increase by anything like the same amount as the overall cost of the house. So it will be a very long time before the effect of the £250 is worn away in added costs.

Mr Reynolds:

– That is pretty vague.


– It is only vague in the view of the unintelligent person, I should think. The fact is that the cost of housing is rising, as are costs in many other fields. This is inevitable; it is part of a general movement. It is certainly true that with the cost of housing going up, the £250 is more necessary now than it was before.

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– I address a question to the Minister for External Affairs. The Minister will be aware of the farewell statement by General Suadi of Indonesia, in which he expressed the hope that Australia and Indonesia would grow closer together economically and so bring Australia’s increasing resources of raw materials and manufactures into a closer and mutually beneficial relationship with Indonesia’s large potential market. As this statement reflects the hope of many Australians, will the Minister treat it as providing an opportunity for the Australian Government to discuss with the Indonesian Government the possibility of accelerating these desired developments, with special reference to a lessening of the tensions in South East Asia?

Minister for External Affairs · CURTIN, WESTERN AUSTRALIA · LP

– It is, of course, the policy of the Australian Government to try to lay the foundations for friendly relationships with Indonesia. Our hope of achieving this result has received a setback by the aggressive movements of Indonesia in respect of Malaysian territory, but in spite of this our policy remains the same and we retain the hope that we may achieve our aim. The honorable gentleman will be aware that we have diplomatic representation in Djakarta, and our ambassador there takes advantage of every opportunity to do what he can to improve relationships between the two countries, while at the same time leaving the Indonesian Government with no possibility of error concerning our firm and clear support for Malaysia in its resistance to the confrontation.

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– I ask the Minister for Air: In view of the general feeling of concern by residents of north Queensland about our air defences, does the Minister believe that our existing airfields are adequate? If they are not, has the Department of Air any plans for increasing the number of secondary airfields in northern areas such as were provided during World

War II, and has it any plans for providing supplies of fuel other than those which are available at present and are in vulnerable’ and exposed positions?

Minister for Air · FAWKNER, VICTORIA · LP

– I should like to assure the honorable member that the air defence of north Queensland is kept continually under review by the Government. At present the base that we have at Townsville, which is capable of rapid expansion, is considered adequate to meet any threats that may arise in that area.

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– My question is addressed to the Prime Minister. The kindly tone in the voice of the right honorable gentleman when he referred last night, by way of illustration, to Alice in Wonderland characters, has led me to believe that he would be acquainted with Enid Blyton’s lovable character Noddy. Does he know > that the Noddy books have been banned by some libraries and that their circulation : is in grave danger? Does he, as the father . of the year and the leader of our nation, consider these books suitable reading for his grandchildren?

Prime Minister · KOOYONG, VICTORIA · LP

- Mr. Deputy Speaker, I am very well prepared to speak as the grandfather of the year because this question comes quite near home. I do not profess to sit in judgment on the intellectual - qualities of Miss Blyton’s works because I suppose that for this purpose I am a lowbrow, but I must say that my experience of my grandchildren is that they read the works of this lady with great voracity.

Mr Beaton:

– What do you think of them?


– I want to tell my honorable friend from Bendigo that I , vividly remember one night when I was left in charge of a parcel of grandchildren who were quite young. I had to go upstairs and . tell them to get into bed. They said: *’ Read , us something, Grandpa “. I said: “ What is it to be? “ The book chosen was one by , Enid Blyton. Really, it was a terrible book about a little boy whose father was a jockey. Because the father took ill on the day of the big race, the little boy rode the horse instead. I thought it was clearly a case for : the stewards. I read the book, but I thought it was rather immoral, viewed from an adult point of view, though quite amusing. I read it from beginning to end, and by then I was getting pretty husky. It was near dinner time. My wife, who had left the children in my care, had not arrived home. She had gone down to Sydney for some function. Finally, I got to the stage - I want honorable members to remember this in my favour - when the children said to mc: “ Well, Grandpa, if you cannot read any more of her books, sing us a hymn “. And I did. Any writer who can occupy my attention while reading a rather improbable story to grandchildren and who can have me end by singing “ Shall We Gather at the River? “ is pretty good.

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– I ask the Prime Minister whether he will table any replies by the Premiers to his letter concerning new Commonwealth legislation to regulate civil aviation throughout the nation on an economic basis, so that, in debating his letter or the new regulations, honorable members may take into account any reasons which the Premiers give for or against his proposals and not merely the informal reactions which some of them are said to have expressed.


– I will undertake to present to the House every reply that I have in identifiable form. I would expect to have a written reply in each case, and I will certainly table any that I have. It is important that honorable members know about these replies.

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Mr Kevin Cairns:

– My question, which is directed to the Treasurer, concerns recent criticisms that the use by the Australian banking system of unexercised overdraft limits introduces an unnecessary element of instability into overall monetary policy. I ask the right honorable gentleman: Does he feel that the techniques of control over Australian monetary policy exercised during the last few years have been sufficiently precise and sensitive to meet Australian conditions?


– The existence of the large total of undrawn overdrafts has been a matter of some concern to the Government and to the banking authorities and the Reserve Bank of Australia. We have given a good deal of attention to the problem and have had discussions with representatives of the trading banks through the Governor of the Reserve Bank. The figures, on the face of it, may seem somewhat alarming, though perhaps that word should not be interpreted too strictly. I may say, rather, that the difference between the total level of advances, which stand at just over £1,000 million, and the total of overdraft availability, which stands at something over £1,900 mililon, suggests, on the face of it, the possibility that in certain circumstances the banks could be called on to supply to those for whom these limits have been established funds at a rate so high as to be of some inconvenience and embarrassment to the banking system at a particular time.

I do not think that we need have too much concern about the matter because both economic policy and financial and monetary policies generally are so framed as to avoid extreme pressures. Of course, one of the objectives of the Budget which the House has under debate has been to maintain a reasonable level of activity in the community without abnormal pressures developing. However, I repeat for the honorable gentleman’s information that we have had this matter under consideration and are looking at the banking system to see whether there are ways and means of avoiding any dangers arising from that situation. I would only add that in quite recent times - indeed in my term as Treasurer - we have commenced to keep statistics on this matter so that we can follow, month by month, the movement which occurs in the level of uncalled overdraft liability.

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– Will the PostmasterGeneral make a statement to the House explaining how his Department arrives at the conclusion that it costs £570 today to install a private telephone receiver? If he will make the statement will he include in it an account of the effect on telephone costs of the leasing of the coaxial cable between Sydney and Melbourne for the exclusive use of the Government’s principal propaganda agent, Sir Frank Packer? In other words, was the cost of constructing this coaxial cable included in the calculation of the current cost of connecting each individual telephone receiver in the Commonwealth? Will the Postmaster-General supply details of the terms of Sir Frank Packer’s lease which are hard to ascertain? Will he state also when the lease is to expire?

Postmaster-General · PETRIE, QUEENSLAND · LP

– I will have a look at some of the matters which have been raised by the Leader of the Opposition. The channels that are used for television between Sydney and Melbourne are only part - if I might say so, a minor part - of the channels available for use because there is a large number of channels available on each pair within the coaxial cable. The charge in relation to these is an economic charge against the users of the telephones. I hope .that during the Estimates debate I will be able to comment, not only on these matters, but also other matters generally associated with the Post Office and the cost to the Post Office of providing services.

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– I preface my question to the Minister for Housing by reminding the House that last night the Prime Minister cited figures which indicate an impressive rise in housing applications. Has the Minister seen figures which indicate a substantial fall in housing applications in the Wollongong area while the State Government talks of fantastic increases in housing at Liverpool which is about 50 miles from Wollongong? Does the Commonwealth and State Housing Agreement permit the State Government to divert housing funds to the Wollongong area where the nation’s steelworks are desperately trying to expand and to obtain labour from abroad?


– I cannot claim to have seen the detailed figures to which the honorable member has referred but answering the question generally, I point out that this is a matter essentially in the hands of the State Governments - in this case the New South Wales Government. It should be borne in mind that the Commonwealth enters the picture only through the Commonwealth and State Housing Agreement. Under the Agreement the States nominate the proportion of their loan funds to be allocated to housing. Having acquired those funds the States have complete control over their distribution. The main obligation of the States is to see that 30 per cent, of the funds is made available through the home builders account, mainly to building societies. As for the remainder, whether it is used to build

Housing Commission homes or whether it is made available in Port Kembla and Wollongong instead of in Liverpool is entirely a matter for the New South Wales Government.


– I ask the Minister for Housing a question. Is it a fact that on a per capita basis the New South Wales Housing Commission has allocated £250 more of its funds to the city of Greater Wollongong than to any other part of the State? Is it also a fact that one house in every six in that city is owned by the New South Wales Housing Commission? Is it further a fact that the allocation of money for housing in Liverpool, referred to by the honorable member for Macarthur, represents the major proportion of the housing construction programme for the metropolitan area of Sydney? Is it a fact that since 1958 there has been an increase in approved applications for Housing Commission accommodation within the Wollongong district from 750 to 2.780?


– Whether the information so freely outpoured is correct I am not in a position to say. I can suggest only that this a clear instance of a question that should be directed to the New South Wales Minister for Housing. This is not a Commonwealth matter.


– I, too, ask the Minister for Housing a question. Although the Commonwealth has made annual grants to the States for housing amounting to hundreds of millions of pounds over the years not one penny of the amount has been made available to house farmers or other rural workers. Accordingly will the Minister assure the House that the proposed Commonwealth legislation relating to housing mortgages will pay due regard to the need of this vital sector of the economy?


– Once again I cannot emphasise too strongly that the distribution of funds provided under the Commonwealth and State Housing Agreement is a matter for the State Governments concerned. Certainly, in considering the housing loans insurance scheme we shall pay regard to rural areas just as much as to any other area.

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– I ask the Treasurer a question. Now that there is to be uniformity in telephone rental charges does the right honorable gentleman intend to extend to all subscribers the privilege enjoyed by business people of deducting from their incomes for taxation purposes the rental charged for telephones used for business purposes? If such a move is not contemplated does this not mean that ordinary subscribers are to be victimised by having to pay full rentals of up to £20 a year whilst a businessman with a taxable income of £4,000 a year will pay a rental of virtually only £10 a year for each telephone after having been allowed a deduction of rental for business purposes?


– The honorable gentleman attributes to me a decision or a practice in relation to this matter which does not, of course, derive from me; it derives from the income tax legislation passed by this Parliament and administered by the Commissioner of Taxation. As I understand the situation, before a taxpayer may deduct from his income for taxation purposes the expenses associated with a telephone he must establish to the satisfaction of the Commissioner that the telephone was employed for business purposes. To that extent only would the cost of the telephone be a deductible item. The matter raised by the honorable gentleman involves an extension of policy which would enable all telephone users to deduct from their taxable incomes the rental cost of their telephones, if I understand him correctly. That is a matter of policy which calls for a novel taxation concession. It would not be appropriate for me to attempt to deal with such a matter of policy at question time. I can only say that, if the matter were pressed by the honorable gentleman, it would be studied in the next review of our taxation laws.

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– I ask the Minister for the Army a question concerning a report in Monday’s Melbourne “ Sun News-Pictorial “ about a young man who on 10 consecutive occasions failed to pass the spelling test set by the Army for people who offer themselves for enlistment. The report suggested that the tests were too difficult and that high proficiency in spelling was not a necessary prerequisite for Army service. Can the Minister give the House an indication of the appropriate school standard of the spelling test?

Minister Assisting the Treasurer · BARKER, SOUTH AUSTRALIA · LP

– The standard set, both in literacy and in intelligence, for entry into the Army is the minimum consistent with a capacity to absorb instruction. The fact that a person cannot spell well, or even that he has had a poor education, does not necessarily lead to his rejection. The important point is that he shall have the capacity to learn. The standard for the literary test, into which spelling enters, is equivalent to grade IV in Victorian primary schools; that is, an average age of 10 years.

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– My question is directed to the Minister for the Navy. By way of preface I point out that 11th September will mark the 50th anniversary of the battle of Kaba Kaul near Rabaul, where the Royal Australian Navy won much fame and recognition and where it achieved many firsts. For instance, it met the enemy for the first time on his own ground, so to speak, and defeated him. Many awards for valour were made, and Australia suffered her first casualties. I ask the Minister whether he has been approached by certain former Royal Australian Navy personnel and the Returned Servicemen’s League, requesting that a ceremony of remembrance be held at Rabaul. Is it the Minister’s intention to make available to certain surviving members of the naval force, concerned the opportunity to attend the ceremony? Has the Minister any plans to ensure that such a ceremony is held?

Minister for the Navy · PERTH, WESTERN AUSTRALIA · LP

– Representations on this matter were made originally to my colleague, the Minister for the Army, when he was also Minister for the Navy. The proposal was that a party of, I think, 15 or 20 survivors or people who took part in the action should go to Rabaul and Kaba Kaul for the ceremony. At the time it was established that a major fleet unit would be needed to convey the party from Australia and that a considerable amount of time would be involved. But the party was offered transport from Rabaul to the site of the action in a smaller vessel. The party thanked us for that offer, but declined it. My colleague, the Minister for Territories, only recently asked me to represent him at the ceremony which he had been invited to attend, and which is being arranged by the Papua and New Guinea Branch of the Returned Servicemen’s League to commemorate the action to which the honorable member has referred. I gladly agreed to represent my colleague and the Government at the ceremony. I understand that some of the people who took part in the action will be present. The whole thing is being organised by the Papua and New Guinea Branch of the R.S.L.

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– My question, which is addressed to the Prime Minister, relates to studies other than of the works of Enid Blyton. The right honorable gentleman will know that in or associated with Australian universities there are departments and institutes devoted to oriental, Pacific, international and Aboriginal studies. I am not, myself, aware of any similar concentration on American studies. I ask the hight honorable gentleman whether it is a fact that our survival in the Pacific is closely bound up in our association with and understanding of the American people. If this is true, has he given or will he give thought to the most appropriate means of promoting such studies in this country?


– I cannot answer the honorable member’s question offhand. As he will realise, I exercise no control - nor would I wish to do so - over the various areas of studies in the Australian National University. I would be interested to find out whether the School of Pacific Studies does or does not include the matters to which the honorable member referred. I am quite prepared to have a discussion with the Vice-Chancellor about this matter.

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KooyongPrime Minister · LP

– I present the following paper -

Loss of H.M.A.S. “ Voyager “-Report of Royal Commissioner.

I ask for leave to make a statement.

Leave granted.


– There will be no need for me to remind the House of the tragic occurrence, involving the collision between H.M.A.S. “ Melbourne” and H.M.A.S. “Voyager” and the subsequent loss of “Voyager” and 82 members of her complement, which led to the setting up of this Royal Commission. Time has not diminished the sense of disaster and great loss which all the people of Australia then experienced. There are many families who have been touched personally by this tragedy. They are very much in our thoughts.

The collision occurred off Jervis Bay on the night of 10th February 1964. On 11th February I announced that there would be a prompt, thorough and public investigation into the tragedy, the investigation to be conducted by a judge. On 13th February I announced that the investigation would be by royal commission and that the Royal Commissioner would be the Honorable Sir John Spicer, Chief Judge of the Commonwealth Industrial Court. The report now presented is clear proof of the care and thoroughness with which Sir John conducted his inquiry.

To remind the House, I will read out the terms of reference for the inquiry. They were these -

To inquire into and report upon the following matters -

The cause or causes of the collision that occurred on the tenth day of February, one thousand nine hundred and sixtyfour, between the ships of our Aus-“ tralian Navy, “ Melbourne “ and “ Voyager “, and the resultingloss of “ Voyager “ and of the lives of persons on board “ Voyager “;

The facts and circumstances leading up to, contributing to or otherwise relating to the collision and the loss . . .

Honorable members will see that that was comprehensive - “ leading up to, contributing to or otherwise relating to the collision and the loss”. The terms of reference continued -

  1. . including, so far as is relevant to the cause of the collision, the nature of the exercise in which the ships were engaged and suitability and preparedness of the ships and of their equipment and crews for that exercise; and

    1. The facts and circumstances relating to the rescue and treatment of survivors.

The House will agree that these are far ranging terms of reference, entirely sufficient to ensure a comprehensive inquiry into the circumstances of the collision and of the loss of “ Voyager “ and of members of her crew. The Commissioner has not indicated any inadequacies in the terms of reference which hindered him in his investigations or in arrival at his conclusions. I shall not here summarise the conclusions of the Commissioner. Honorable members will themselves obtain the conclusions from their own reading of the report and from reference to the diagrams set out as appendices. This is a matter on which I think all honorable members ought to form their own estimate.

The Government, as honorable members will appreciate, has had only a very short time, up to this point, to consider the findings of the Commissioner. The report has become available to Ministers only within the last few days. However, the Government has, of course, taken steps to obtain from the Naval Board advice, through the Minister for the Navy (Mr. Chaney), upon the Commissioner’s findings and the implications of those findings. The Naval Board has already begun this task. Indeed, it had begun its labours as evidence was being taken. When the results are to hand, the Government will give prompt consideration to them and will then put itself in a position to make a further statement to the House.

I wish, in conclusion, to refer briefly to a matter which I believe honorable members would wish me to recognise. That is the prompt and notable actions of individual members of the crews of “ Voyager “ and “ Melbourne “ and of those taking part in the search for survivors. The Commissioner’s report instances many splendid examples of leadership, bravery and sacrifice. On behalf of all of us, I would like to pay tribute to these men. I move -

That the House take note of the paper.

Mr Calwell:

– The Opposition would like to debate this matter and all its tragic circumstances and the human element involved because of the importance of our Navy to Australia. But we would like to do this when the report of the Naval Board and the further statement that the Prime Minister said he would make are before the House. I would like an assurance that the debate will be resumed as soon as prac ticable after the Government presents the report of the Board.

Sir Robert Menzies:

– I think I should clear up one point. I did not say that we would present the report of the Naval Board. The Naval Board, through the Minister for the Navy, advises the Government. All sorts of advice is received in this way from our expert advisers. What I said was that, having been put in possession of such points, information and comments as we could understand from the Naval Board and no doubt from the Minister for the Navy, I would then take the opportunity of making another statement to the House. The Leader of the Opposition will realise that reports to the Government by its expert advisers are not presented to the House; the Government takes responsibility for these matters. However, I think there is good sense in the proposal that we ought to have whatever debate ensues - it may be a far ranging one - after we are in a position to tell the House something further in relation to this incident.

Mr L R Johnson:

– How long will that be?

Sir Robert Menzies:

– I would hope it would not be long. Believe me, I do not want to delay this matter. If this is the general feeling of the House, I would, of course, be very pleased to fall in with it. I can see that it could mean we would have one debate and not two.

Debate (on motion by Mr. Calwell) adjourned.

page 603


Second Reading. (Budget Debate.)

Debate resumed from 25th August (vide page 589), on motion by Mr. Harold Holt -

That the Bill be now read a second time. Upon which Mr. Calwell had moved by way of amendment -

That all words after “That” be omitted with a view to inserting the following words in place thereof: - “the House is of opinion that the Budget does not adequately grapple with the problems of striking a realistic and fitting balance between the claims on national resources arising from defence, development and social welfare”.

Mr. FULTON (Leichhardt) [3.24J- I support the amendment moved by the Leader of the Opposition (Mr. Calwell). I do so for the many reasons that have already been advanced by my colleagues and because the Budget is ineffective and contains injustices. The amendment is justified not only because of the mistakes made in the Budget but also because of the omission from it of many points that should have been included. It is difficult to understand the attitude of the Government in budgeting for a surplus. After all, the previous Budget planned for a deficit and ended up with a surplus. The trend of our economy is reflected in the fact that our overseas markets, for both primary and secondary products, are increasing; our population growth is being accelerated by the addition of many thousands of immigrants annually. The arrival of these immigrants is building up the work force in Australia. This means that there will be an increase in the number of people paying taxation. This fact alone should have given the Government the confidence to go forward and allow this country to expand and develop as it should.

Australia is a young country with vast undeveloped areas. A tremendous programme of national works must be undertaken so that this country can give of its best. We have natural resources as yet untouched. The rainfall on the eastern slopes of the Great Dividing Range in the north of Australia flows away to be wasted in the ocean. A scheme of the magnitude of the Snowy Mountains undertaking is required so that use could be made of that water in the inland areas. Such a scheme should be tackled as soon as possible by a responsible Government. I feel that the Government lacks confidence in Australia. If the Government had budgeted for a deficit or even forecast a balanced Budget, it would have given incentive to the people of Australia to spend more money on national programmes and to contribute more money in the loan field. This action would also have given business people the opportunity of expanding into other areas of this country. This is, in my opinion, one of the main objectives that we should try to achieve. The actions of the Government so far have resulted in an increase in the populations of our capital cities which are expanding and outgrowing their areas. People from Australia’s outback are being forced to move to the cities because those living in the remote areas are not being given the incentives that they should have. Such incentives would include special taxation allowances, educational facilities and other amenities as are enjoyed in the cities.

I believe that all honorable members of this House feel as I do in regard to the responsibility of this Government in the expenditure of public moneys on public works. The Government’s move in establishing the Parliamentary Standing Committee on Public Works was a very good one. I have recently been appointed to this Committee. I must pay a compliment to the Chairman of that Committee, and also the members of the Committee past and present for the way in which they have conducted their inquiries into all the national projects which have been placed before them ‘by the Government. The Committee ensures that, first of all, it is necessary that the money be spent and, secondly, that the money is being spent in an appropriate manner for the benefit of Australia and its people. With those objectives in mind, during the last recess I criticised the beef roads scheme. I did not criticise it with the idea of being a knocker or anything like that. I did so bearing in mind the responsibility of members of this Parliament to see that public funds are wisely spent. After all, these funds are passed into our hands and we are responsible to see that they are spent in the best possible manner to assist the development of this country.

I have received information concerning beef roads not only from the graziers who live in these areas but also from the transport people who travel them. I have had this information examined and I have found it to be true. I criticised the beef roads because of the bad state of disrepair into which they had fallen in such a short period. I also had the opportunity of accompanying honorable members who were visiting the north of Australia. In Mossman, I asked those members whether they could visit the beef roads, and if they could, to do so. They did visit the beef roads and the photographs they sent back were published in newspapers. The great deterioration that had occurred in the roads was clearly evidenced in those photographs.

Yet those roads have not been through one wet season. The Minister for Main Roads in Queensland, Mr. Evans, stated in a Brisbane newspaper that I was misinformed. If I was misinformed, so were many other people, including the President of the United Graziers Association in Queensland. In the “ Cairns Post “ of 7th July 1964, this statement appears -

The United Graziers Association president (Mr. P. Bell) said, “The efficiency or otherwise of the beef roads is a matter of great concern to the grazing industry. The industry must be reassured that they will continue to serve that purpose “.

Apparently, Mr. Bell is not too happy with the assurance that these roads are built to last forever.

As I said earlier when this subject arose, the building of these beef roads was an election gimmick. It was hastily conceived and just as hastily applied. At that particular time, I did state that the roads would not be worth anything unless they were properly sealed. Unfortunately, some of the members of the Country Party laughed about that statement. Later, the Minister for Main Roads in Queensland supported my statement and made an application to the Commonwealth Government for an extra grant so that these roads could be sealed. I said at the time that the grant was inadequate. I have had experience with roadbuilding in tropical areas. I know what it costs local authorities to undertake this work. It is no good saying afterwards, when the condition of these roads has deteriorated, that it was the inclement weather that brought about that deterioration. This type of weather has always been experienced in these areas. It must be realised that the roads must be built strong enough to stand up to the conditions. The weather cannot be altered so that the fine roads which have been put down will not be destroyed. I say quite definitely that there should be more research into road construction, materials, surveys and supervision. Unless we do these things, the money that already has been expended on roads will have to be trebled. Even ten times as much money may have to be spent. Money is being wasted on the maintenance of these roads, and this is costing more over a period of four or five years than the actual cost of the roads themselves. This situation will continue unless our beef roads are more firmly embedded, and have firmer foundations with proper drainage and surfacing that will last.

Although I know that the main purpose of these roads is to transport beef, I do not regard that as ‘ being their only purpose. I look on these roads as being future defence roads. The roads will be needed for that purpose, should the occasion arise, because of the policy of the Queensland Government in closing down branch railway lines and dismantling them. These branch lines played a tremendous part in the last war in the transport of troops and equipment into the northern parts of Queensland. Should another war break out - and I hope it never will - we would not have the use of these branch railway lines which are being dismantled. Therefore, we will have to use the roads to transport equipment, troops and supplies. For that reason, we must regard them as being strategic roads as well as beef roads. That being so, we should be more concerned about the strength of their construction than we are at present. Some honorable members have colour slides of the damage that these roads have suffered. I should certainly like the Minister for Works (Senator Gorton) to see the slides, because they do give some idea of just how much deterioration has taken place on those roads.

The President of the United Graziers Association, Mr. Bell, tried to make things easier for the Queensland Minister for Main Roads. He was reported in this way -

Mr. Bell said today that he understood that the engineers who supervised the construction of the beef roads in north Queensland had no previous knowledge of the extent of flooding. Certain sections of road had been strengthened to cope with flooding but the floods had extended further than usual, causing potholing at either end of the strengthened sections.

He said, “No great road systems have been built in that area before. The engineers would be working in the dark as to the fullest extent of the flood “.

If those engineers had made inquiries of such local authorities as the Carpentaria Shire Council, the Cloncurry Shire Council and the Mr Isa Shire Council they could have got a great deal of valuable information, if they were prepared to use it. It could be that they were too proud to use it. It is wrong to say that no road systems have been built in the area. The local authorities have been building roads for years. The only reason why they were not able to make the roads strong enough to carry heavy traffic was that they did not have enough money. All those local authorities have complete data relating to floods and road construction problems in their areas, and they could have supplied valuable information to these engineers. I am amazed that such an excuse as lack of information should have been med. The information was available if the engineers had been willing to make use of it.

I mention the Normanton-Julia Creek stretch of road because that has deteriorated very badly. Although the Queensland Minister for Main Roads said that I had been misinformed, he did admit that great deterioration had taken place on this road due to the fact that the flood waters had risen to a greater height than had been expected. He also said that there was a length of road - I cannot remember the exact mileage - that required resealing. I point out that this road has been down for less than 12 months. If it needs resealing after that short time, what will it be like in 12 years’ time? There can be no proper foundation; otherwise the road would not have deteriorated so badly.


– It is a State matter. I do not know who the contractors were. Mr. Bell went on to say that only a few miles of the 272 miles of road in the stretch from Normanton to Julia Creek needed repairing. I remind the House that a road may be likened to a chain. It is only as good as its weakest mile. It’ is useless for a road to be good at the start and good at the finish if you cannot travel over it from start to finish. The weakest parts of these roads must be strengthened to carry heavy traffic, lt has to be remembered that the volume of traffic is increasing all the time. As further proof of the need for the fullest possible investigation into road construction, the types of materials used and so on, I refer to the number of road accidents mentioned by the Australian National Road Safety Council. That authority points out that in 1963 2,575 people were killed and 66,287 injured on our roads. In all, 70,862 persons were either killed or injured on our roads in that year. One would expect such figures to refer to deaths and casualties during a war, yet they refer to accidents on our roads. Those statistics must emphasise the great need to build stronger and safer roads to cater for faster vehicular traffic as well as pedestrian traffic.

As a result of deaths and injuries on roads in 1962, there was a loss equivalent to two million working hours. That is a tremendous loss. Our roads must be built to better standards than they are today if we are to avoid such huge losses. There must be more research into road building with a view to decreasing the accident rate. Not all road accidents are due to careless driving, drunken driving and so on. I have seen the deterioration of these roads in the north. Some have deteriorated so much on the shoulders that just off the edge of the road there is a drop of from 10 to 15 inches. Some of the roads in Queensland were from 20 to 24 feet wide when they were first built, but by the end of a wet season they had been narrowed down to 16 feet. The edges have broken away so much that vehicles are forced almost off the road when passing, and the sudden drop at the edge either throws them off the road or throws them back on to the road, into collision with another vehicle. I have seen this happen many times, and a great deal of damage is caused.

I have not yet seen roads on which the edges have either crumbled away or deteriorated as much as on the roads in Queensland. Despite this, no research is taking place and nothing whatsoever has been done about it. The situation should be examined with a view to increasing the strength of the shoulders of roads. It is all very well to have from 16 to 18 feet of good surface in the centre of a road, but how many cars run on the centre of a road? They keep to the side of a road. The only time when the centre of a road may be used is when the road is clear for some distance ahead, when there is no other traffic approaching, and it seldom happens that there, is no traffic approaching if one is travelling on a good road with a sealed or tarred surface.

When speaking of beef roads, I was not referring solely to the beef roads in Queensland; I was referring to the whole of the beef roads system. The Commonwealth

Minister for Works said that I had been answered by the Queensland Minister for Main Roads, but I venture the opinion that when the Commonwealth Minister sees the photographs I have - I hope he does look at them - showing the deterioration that has taken place in the roads leading from the Northern Territory into Queensland he will realise that more attention must be given to road construction. The deterioration that has taken place on the roads was mentioned in the Press, and those of my colleagues who went to the Northern Territory brought back photographs of the damage. In those photographs may be seen holes deep enough to contain a family car. One photograph is of four men standing in one hole, and all that can be seen of the men is their heads. If that is how our roads deteriorate, it is no wonder that people are complaining about spending public money and getting no results for it.

I have received many letters about the roads from graziers. One that I received was from a Shire councillor, who is also a grazier. It refers to the Hann Highway, or the Northern Inland Highway, and states -

Sir, the condition of this road is quite beyond reasonable description. Its condition is such after 3,000 head of cattle have been trucked from Carpentaria Downs it> the past few weeks with as many as 20 trucks per day using it that shortly motor cars will not be able to drive safely as it is almost impossible to keep a car on the road.

If that is going to continue to happen with these roads, they are not going to serve the purpose for which they were constructed and they are certainly not going to be of any use for defence purposes.

So much for roads. There are many other things in the Budget that can be criticised and I should like to refer first to defence. I am amazed that the Treasurer was not forceful enough with the Cabinet to see to it that members of the Citizen Military Forces were granted the justice for which they asked. I know these people very well. I was one of them myself. They give up much of their spare time and their family life suffers because they are interested in learning to defend Australia. They give up whole week-ends and sometimes their holidays so that they can be trained to be leaders and so that they can learn about the weapons that are available and be ready to impart their knowledge to others in their area should the need arise to defend this country. They receive no pay for two-thirds of the time that they give to the C.M.F.;. they are paid for only one-third of the time spent. Unfortunately, the amount that they are paid for the time that they give is added to their income and they are taxed on it.

Dr Forbes:

– No more.


– I am very pleased to hear that. I had not read that in the Budget Speech, but it is nice to know that they are not now taxed on these earnings. This relief was promised by the Prime Minister (Sir Robert Menzies) many years ago. When the Prime Minister was in the C.M.F. mess in Cairns he was asked about relief from taxation on Army pay and he promised that he would favorably consider the granting of C.M.F. pay free from income tax. If that has now been done - and I have been assured by the Minister for the Army (Dr. Forbes) that it has been done’ - I am very thankful because it will give members of the C.M.F. an incentive and will be an aid to recruitment.

Other aspects of taxation should also have been considered by the Treasurer when framing the Budget. Some time ago I raised the question of tax deductions for expenses incurred in travelling to receive medical attention and the Treasurer said that this matter would be considered but, apparently it has not been considered. In many country areas, particularly in my own area in Queensland - I imagine that the situation is similar in other areas of Australia - family people who have not medical services readily available to them are forced to travel by air or train to see a specialist in Brisbane or in some other capital city. Often, parents have to accompany their children to receive treatment. These people do not make the trips merely because they are fussy about seeing a particular doctor; they have been advised by the medical superintendent of a hospital to take their child to Brisbane for attention. Sometimes fares of £50 are involved in travelling to Brisbane and home again but that amount cannot be claimed as a tax deduction. Yet, a businessman can take a holiday business trip anywhere in Australia and deduct his costs for income tax purposes.

When I first raised this matter 1 told the Minister- and I repeat it now - that this was unfair to the people concerned. Those people are struggling. They do not have free travel passes and they are subject to a means test in respect of medical treatment. If they are earning they have to pay for treatment for their child and also have to pay fares for themselves and the child to receive medical attention which is not available in their own area. I believe that that injustice should be remedied. A concession of this nature would not have much effect on the Budget. There would not be more than 200 people in my district who would be affected. But it does affect the low income group who are trying to save every penny. It is an anomaly when expenses involved in travelling to receive medical attention cannot be claimed as a taxation deduction whilst a businessman can claim a deduction when he travels. This situation is very annoying and should be cleared up.

Many other anomalies should have been removed by the Budget. Having budgeted for a surplus, surely the Government could have provided some justice to pensioners. I refer particularly to pensioners who are living in their own homes and who are not entitled to receive the additional assistance of 10s. a week. A single pensioner who pays board receives 10s. a week additional assistance, but one who owns his own home receives no additional assistance, unless some assistance such as a reduction in rates is given by a local authority. The pensioner who owns his own borne is still liable for services, repairs, insurance on the house, light and fuel. Surely he is entitled also to that assistance of 10s. a week. I believe, also, that this assistance should have been provided for married pensioners. The refusal to grant the extra 10s. to married pensioner couples differentiates between them and single pensioners. It would have been far better to have granted the 10s. to each person, whether single or married. I shall say nothing about the grant of a 5s. increase, rather than 10s., to pensioners; enough has been said about that. Pensioners should have been given a rise of at least £1, which was the increase in the basic wage granted by the full Conciliation and Arbitration Commission. On behalf of pen sioners, I protest at the inadequacy of the increase.

I have spoken to the Minister for Repatriation (Mr. Swartz) about repatriation benefits. After fighting so long to ensure that the ex-servicemen in the Torres Strait islands received rights equal to those received by people on the mainland I have been surprised to find that some anomalies still exist. I thought that all these matters had been fixed up. I find, now, that it will be necessary for the Repatriation Act to be amended to enable Torres Strait islanders to receive such things as medical sustenance which is not available to them at the moment. The Minister advised me that no provision exists in the present Act to provide that sustenance, but he has assured me that it will be amended. I hope that it will be amended as soon as possible so that these people who served their country and were pleased to do so will be entitled to receive the same treatment as ex-servicemen on the mainland. Although I was under the impression that anomalies had been removed from the Act, when the first application for medical treatment was made we found that nothing could be done about it and that sustenance had to be refused because the applicant was a native ex-serviceman. I hope that the Minister will honour his promise and alter the Act to ensure that Torres Strait islanders receive the rights to which they are entitled. I hope also that the amendment will have retrospective application. There are many other matters in the Budget to which I should like to refer, but I will have an opportunity to raise them when we are debating the Estimates. I conclude my remarks by stating that I trust that future budgets will achieve more than has been achieved by this Budget.


.- Mr. Deputy Speaker, I support the Bill. At the same time I ask that the Government give early consideration to the recommendations brought down by the Joint Select Committee on Publications and Printing. I make no further comment about that at this time. The subject on which I wish to speak this afternoon is decentralisation. I take this opportunity to present once again to this Parliament and to the people a reiteration of this problem which has been discussed on many other occasions, not only by people of Australia, but by people in other countries who have similar problems.

Decentralisation is not our direct responsibility but it has many facets that are peculiar to every State in the Commonwealth. I feel that it is time we faced the various positive and negative aspects involved in this problem and devised a solution that meets the needs of our growing country. This problem certainly needs to be brought down from its pedestal and examined in terms of real advantages and disadvantages that are portrayed in the strategic, economic and social features of decentralisation. If, after a careful examination of the facts, we decide on a desirable policy and type of decentralisation which is most suitable for Australia we need to set about designing and implementing a programme which will have a favorable effect on population distribution. Even if the problems solved are local in nature and seem small in comparison with national efforts, the resulting successful projects will be of tremendous magnitude in the development of this potentially great nation. It is a problem that has plagued us since the beginning of our early development, and it will continue to gnaw at our conscience as long as we face difficulties involving economic congestion.

Let us view this problem in four phases - geographic, strategic, economic and social. Geographically, we were looked on as a vast barren southland, suitable only for alleviating the overcrowded prisons of England. But left on our own we found that the soil could give us a prosperous living. Our development of gigantic and consolidated seaports was purely for the exporting of our raw products for the English markets. It was economically sound at that time to concentrate the centres of commerce in the areas that nature provided for ease of accessibility to the main source of our income which was England. Later, “ gold “ was the cry and this was the only reason for the development of any sizable areas of habitation in our hinterland.

We are still faced with the fact that this island continent is the driest in the world. The fringe areas are our salvation, but even in those areas, where the rainfall is quite high, thousands of acres of land remained idle until the discovery of the need for trace elements after the close of the Second World War. These are some of the geographical facts that we must consider before drawing up plans for decentralisation. The lack of organisation and foresight in our development has left us with problems that are causing continuous economic strife and preventing us from competing in foreign markets because of our low rate of efficiency due to exorbitant transportation costs. Our railways and road systems have their focal points in congested and concentrated areas of haphazard development. If, even in a small way, decentralisation could overcome this difficulty, we could be well on the way towards economic efficiency and advancement.

Strategically Australia is one of the most vulnerable countries on earth. If one had been on Ranger 7 out in space and taken a look back on our continent it would have seemed - if one had been otherwise uninformed - that our 11 million people were just arriving or getting ready to leave. It is not a comforting thought that any foreign power can lawfully approach within three miles of the centres of our industry and population. As Australia stands at present, a relatively small number of nuclear weapons would not only put us out of any war but would also destroy the nation’s economy and decimate our population. Where could we run to? Where could we continue to fight from? Where could we start again? These are the questions, morbid though they may be and exaggerated the premises on which they are based, that require vital and immediate answers.

Private business and governments go on month after month, year after year, piling more eggs into our pitifully few baskets. Vital industries of every kind - oil refineries, munitions plants, nuclear laboratories, vehicle and machinery manufacturing plants - all are being built in and around the big cities, particularly Sydney and Melbourne. What would be left if Sydney and Melbourne were reduced to ruins? Gone would be most of the nation’s oil refineries and storage facilities. Gone would be most of our transport industries, commerce facilities and banking structure, to say nothing of the fact that 5 million of our 11 million people would be dead or maimed. How different would the picture be if we had a proper distribution of population and of industrial, commercial and transport strength.

Very large cities are thought to be economically inefficient. It is more expensive to provide an adequate water supply for a very large city than for a medium sized city because a large catchment area must be harnessed. Sewerage must be piped greater distances to remove it from the built up area of the very large city. Perhaps the most important economic handicap of large cities is represented by their traffic and travel patterns. It has been estimated that on four-lane roads in Syd-, ney, the cost per mile of operation per vehicle rises from about 16id. to about 24Jd. as the traffic volume rises from the minimum to 3,000 vehicles an hour. The average worker travels long distances to and from his place of employment each day at considerable expense and inconvenience to himself. Although the community as a whole spends very large sums of money in providing new and improved roads and bridges, traffic congestion remains a serious and very costly problem.

In addition, the man who is working in a small centre will arrive ait his place of employment less fatigued and more physically and mentally efficient than the man who gets to work after suffering the frustrating grind of travel in a congested city. It has now been shown by many of our large industries that have certain operations carried out in small cities that the output per man-hour is much higher and the operations generally are more productive than is the case in plants located in the large cities.

Lewis Mumford described the social phase of our problem when he said that any city of over 50,000 population never lives by its own children. It must always import its population from outside in order to keep up its numbers and to grow. So it is something that is living on the whole community. A big city depends on the rest of the community for its population, and that is one of the first causes of disaster. Not only does it uproot people from the country and draw them in like an octupus reaching out its arms; it is also a dehumanising unit of business houses, desolate streets and bundles of suburbs.

I can give the House something of my personal experience of the problem of decentralisation. This comes close to home when we consider the great expansion and development of the Postmaster-General’s Department in Melbourne. This department has a great need of young men for its large development programmes in the cities. Many parents have been in touch with me in their efforts to have their youngsters who work for the Postal Department brought closer to home because of the difficulties they have experienced in finding suitable board and accommodation. The parents naturally desire to maintain family unity and control.

Decentralisation means far more than encouraging a few industries to establish themselves outside the big capital cities, although this industrial movement may be termed the core of decentralisation. Decentralisation is the spreading of our whole industrial, commercial and business life evenly over the land we occupy according to the relative capacity of each part of that land. It is a vital national problem and if the problem is to be solved, decentralisation must become a national way of thinking. It is also vitally necessary for the proper and orderly functioning of our peacetime society and the proper and adequate usage of our country.

Now that we have our large cities, quite out of proportion to our total population, wc are, to use a colloquial term, stuck with them. But if the nation is alert to their potential and actual danger, their development can be slowed and a better distribution of population, with all the essentials of a modern society, can be achieved. The solution to this problem, as I see it, lies in the formation of new States. This in turn would give a stronger voice to States’ rights. When one suggests a need for new States in Australia one invariably encounters the comment - “ We don’t need more States, we need fewer “. This oft-repeated remark would seem to represent a blow to the advocate of new States until it is examined closely. I have heard this comment so many times that it seems to show that the people generally consider they are overgoverned. However, one should not confuse division of administration with overgovernment. They are not totally different but they are certainly not the same thing.

If one challenges and examines the “ fewer States “ comment one eventually finds that it represents one of the greatest arguments in favour of more States. The suggestion of fewer States means precisely what it says, and we could have fewer States only by amalgamating one or more of the existing States with one or more of the other States. When this is pointed out there is frequently no answer to it. If it is suggested to a Victorian that his State be amalgamated with New South Wales, he is totally opposed to such an idea, particularly if it is suggested that Sydney should be the capital of the combined State. He would not be so strongly opposed to Tasmania merging with Victoria because he can see that there would be no chance of the Tasmanian section dominating the Victorian section. On the other hand, however, Tasmanians would be appalled at the prospect of joining Victoria and subsequently being numerically and financially dominated from the mainland.

The “ fewer States “ argument, therefore, falls flat on its face, but it reveals an important clue to public thinking and it becomes a very strong argument for a greater division of administration, or for new States. It is apparent that no one section of the Australian community likes the prospect of being dominated by a stronger section. In the argument about the possibility of a joint State of New South Wales and Victoria governed from Sydney, one of Victoria’s biggest concerns is its distance from that centre of administration. Yet this is the very situation that exists in Australia today: Large areas are being dominated by huge capital cities, and country people are too far from the centres of administration. Each capital city is like a giant octopus that feeds on the remainder of the State. It is obvious that Australians like close contact at the State level. The establishment of new States is the only sure method of giving our people this close contact.

If one wishes to deal fully with this question of new States, one must go back into Australia’s history to see how the present system of administration arose and where it falls short. The basic cause lies fu the fact that, for many years after 1788, Britain had no interest’ in Australia except as a place in which to dump unwanted citizens. Nor could Britain, in those days of poor communications, appreciate that this country had any real potential. New South Wales then embraced all Australia except the western section. All activity was concentrated in the Port Jackson area and settlement was not expected to extend very greatly. But the spirit of men was something greater than the vision of far away politicians, and gradually communities spread out from Port Jackson to the north, the west and the south. As new areas developed, the demand for self administration grew, and Victoria, Tasmania, South Australia, Queensland and Western Australia emerged as separate States. But the division stopped there. It is difficult to understand this, Mr. Acting Deputy Speaker. As people spread north to New England and Queensland and south and west to the Riverina, one might have expected new colonies to arise, particularly in view of the slow transport facilities in those days, as people moved farther and farther away from the centres of administration.

If we follow Australia’s development, we see that certain definite areas of development are clearly revealed. Starting from the north, there are the areas of Townsville, Rockhampton, Brisbane, New England, Sydney, the western plains, the Riverina, Melbourne, Portland, Adelaide and Tasmania, with the Perth area isolated by a large section of more slowly developing country. These areas are quite distinct in character, and it is undoubted that the breaking away movement should have continued. The continuation of this movement would have provided more compact areas of common interest, with the people in more intimate contact with their administration and, perhaps more importantly, the administrations in closer contact with their people. Yet today we have large administrative areas in which more than half the people live in or near big capital cities. The remaining half get government at a distance. It is no criticism of a metropolitan government to say that it does not understand or appreciate the day-to-day problems of people hundreds of miles away. Where there are no real appreciation and no proper understanding of the problems of others, there can, unfortunately, be no true sympathy with them.

I do not suggest for one moment that State Governments have been totally unmindful of their obligations to all the people in the respective States, but I do suggest that people living long distances from the centre of administration would be better suited if they were allowed to conduct their own affairs. The metropolitan mindedness of governments must always be a barrier to proper decentralisation, and the claims of success made for decentralisation policies are somewhat exaggerated. The big capital cities are still outpacing all other areas. The really big industries all have congregated in or near the capitals. After the war, many industries established annexes in country areas, setting them up in old school buildings, public halls or temporary structures. But there was never any aura of real permanence about them. Certainly, some of them have remained, but just as many or even more have now closed down, the activities being returned to the cities.

This movement towards decentralisation came at a time when labour everywhere was in short supply. These industries soaked up the labour available in the country; Now that they have returned to the big cities, they have taken this labour with them and have actually worsened the position. What happened, of course, was that in many instances the industry established in a country town was just large enough to utilise the spare labour available in and about the town. Few of these industries were big enough to create employment opportunities for more than the locally available labour force and thereby bring new people to the locality. Now that the flush of postwar labour shortages has passed, the big industries continue to crowd the capital cities. It is argued that they must be established there because that is where the labour is. This argument is not wholly valid. Obviously, the labour is there because that is where the jobs are. Continuing to provide avenues of employment in the big cities only ensures that more labour congregates there. It must follow that if jobs are created elsewhere labour will move to them.

One of the classic examples of this, I think, is the La Trobe Valley in Victoria. There can be no suggestion that the great industry of this Valley should have been established in Melbourne, because the very essence of it - the huge brown coal deposits - happened to be 90 miles from Melbourne. The development of the deposits was essential, and there has never been any suggestion that, because they were nearly 100 miles from Melbourne, sufficient labour to develop them was not available. More often, shortage of funds has caused labour to be turned away. Another example is Broken Hill - a city of 30,000 people in what is a fairly barren and unprepossessing area. If labour can be found for the La Trobe Valley because brown coal is there and for a city of 30,000 at Broken Hill because silver and lead are there, it must follow that if, for example, a big automobile plant is established in a relatively small town or city, labour will move to it. There is only one difference: In one case, circumstances force the development of the site, whereas in the other, private industry cannot be forced to set up shop in a particular place. But I believe, Mr. Acting Deputy Speaker, that governments can point the way and encourage such movements, while industry itself should be able to realise that, by crowding info a large capital city, it is contributing to that city’s potential as a target in war and to a bad imbalance of population in peace.

Apart from defence considerations and imbalance of population, there is a third important reason why we must endeavour tp slow down the growth of the big capital cities. This, simply, is that Australia cannot afford such big cities.This is a fact that is not often realised. But it is true that big cities cost money. It would certainly appear that industry does not realise this. One of the chief arguments used by industry against establishing plants away from the capital and chief port of a State is that establishment elsewhere would place an enterprise at a disadvantage in respect of freights. Yet I venture to suggest that the cost to industry of establishment in a big city, if this could be assessed, would far exceed the cost of freighting goods back and forth between a port and the site of plant. However, freight costs are something that can be put down in black and white in a balance sheet; costs resulting from location in a big city cannot.

Melbourne, for instance, needs - and ultimately will get - an underground railway system. But someone will have to pay for it. However, if Melbourne were a city of 250,000 people and there were seven other cities of similar size scattered throughout Victoria, none of them would require an underground railway system. Sydney has already spent millions of pounds on an underground railway and is spending more. These are only some of the costs of big cities that are somewhat hidden, Sir. These costs never seem to be evaluated. Millions of pounds have already been spent, and will yet have to be spent, in providing parking facilities underground and above ground. Business of every description loses millions of pounds in traffic delays caused by congestion. Not so long ago, estimates made in Sydney suggested that traffic congestion added as much as 2s. 6d. to the cost of an article priced at 50s. and increased costs in total by £1 million a month. Streets subjected to proportionately heavier traffic need repair more frequently. Special traffic facilities are required.

The list of added costs becomes almost endless. They are costs that every nation must meet eventually, but they should not have to be met on the scale which operates in a country like ours which has a total population of only Hi million people. Sydney contains almost one-quarter of the population of Australia. One-fifth of the remainder live in Melbourne, so Australia has one third of its population m two cities and one-half in five cities. We just cannot allow this state of affairs which is continuing and developing so quickly. We must do something now to prevent it.

Like our over-large administrative divisions, our big cities are a legacy of our history. They began as ports to supply the needs of the early settlements. They became the administrative centres for the colonies. But when people began to move inland the governments stayed where they were. Commerce gathered around them and industry eventually followed. Obviously, when our States became self governing colonies a century ago, no consideration was given to whether the place where the administration had been set up for the convenience of far away England was, in fact, the best site for the capital of the colony. It is undoubted that, had the administration at that time selected a site away from the chief port, none of our major cities would have been as large as they are today and there would have been more of them. For a start, industry and commerce would have been split between capital and port. Naturally, at this stage, it is too late to make a change, but we should recognise it as a mistake of the past and not repeat it in the future.

The establishment of new States cannot adjust Australia’s population or industrial imbalance overnight. In fact, the big cities have such a start that there will always be a fairly bad imbalance. However, together with a realistic administrative approach to the problem, new States will achieve much that is worth while. First, they will give the people now long distant from their administrative centres the opportunity to govern themselves. Secondly, they will produce more compact areas with which the administration is in closer touch. Thirdly, they will provide the opportunity for the new States to encourage and draw industries to their areas. Fourthly, provided the force is not simply enlarged, they will draw their Public Service from the existing capitals, bringing people with them to provide the additional services necesary. Fifthly, the new States could create other avenues of employment which would have to draw on the big cities for labour.

Finally, and perhaps more importantly than may be realised, they will produce a change in the centre of gravity of the people’s thinking - a new spirit and a new interest. All these factors, and others, will tend to slow down the growth of the big cities and result in the building up of smaller ones elsewhere, but this must be accompanied by a virile decentralisation policy in the States governed from the big capital cities to spread the population in their areas better. There is a need today for 13 states in Australia covering the areas where there is sufficient population to support them. As for the vast tracts of sparsely populated undeveloped areas, these should be removed from the responsibility of the States and made the responsibility of the Commonwealth. I hope that at the next Premiers’ Conference this matter will be given serious consideration.

Port Adelaide

.- In rising to support the amendment proposed by the Leader of the Opposition (Mr. Calwell) I desire, first, to point out that, day after day, in the brief period that I have been in this Federal Parliament I have heard members on the Government side of the House make statements purporting to portray the Australian Labour Party as having within its ranks three or four different groups with three or four different policies. I hasten to say that nothing could be further from the truth. However, after listening to this Budget debate so far, it is crystal clear that almost all of the backbenchers on the Government side are opposed, in part or in whole, to the Budget that we are now discussing. In fact, they have admitted, through the person of the honorable member for Lawson (Mr. Failes), that although they are elected members of Parliament who support the Government of Australia they have no say in the framing of the Budget - the most important document presented to the Parliament.

Before submitting my views on the Budget, I wish to comment on some remarks made during the debate by the honorable member for Higinbotham (Mr. Chipp) who discussed aid to under-developed countries, advocated Australian investment in industries in those countries and, at the same time, suggested that we should not erect tariff walls to prevent those countries exporting to us. In other words, the honorable member has resurrected an old Tory plan to exploit cheap labour under the guise of helping to develop a backward country. I suggest that the real reason is to amass greater profits at the expense of the Australian worker.

I now turn to the Government’s decision to increase sales tax on motor cars from 22i per cent, to 25 per cent. This increase represents the eighth change in sales tax on motor cars in 13 years. There have been four increases and four decreases. History reveals that each time the tax has been increased motor car sales have fallen alarmingly and the Australian motor industry and its allied industries, including rubber, paint, glass and steel, have been forced to make heavy retrenchments. However, each time the Government has belatedly adjusted the position by reducing the sales tax these industries have quickly come back and picked up.

The Australian motor industry, taking into account manufacture, sales, repairs and other aspects associated with it, is the biggest employer of labour in this country. As such, it is of paramount importance to the nation. This is particularly so in my State of South Australia. Furthermore, due to the many and varied skills of its workforce, and its modern equipment and machinery, it is of major importance in time of war. This was clearly illustrated during the dark days of the early 1940’s. While it is true to say that this industry is at present enjoying a period of great success and prosperity, it is equally true to say that it is the kind of industry that is most vulnerable to economic change from price movement. Therefore, it seems remarkable to me that the Treasurer (Mr. Harold Holt), knowing this from bitter experience, on the one hand said in his. Budget Speech that the rate of growth in this industry is bound to slow down and then, on the other hand, nonchalantly proceeded to increase the sales tax, thus expediting the slowing down process.

I point out that any increase in sales tax on motor cars does not affect only the purchaser of a new vehicle. Its repercussionsare much wider than that. In actual fact, it is an added tax on every section of the community. It goes without saying that the sales tax is a tax on the person who buys a new motor car. But it also affects the person who buys a second-hand motor car because the prices of second-hand vehicles are governed by the prices of new ones. Sales tax is also passed on to the person who does . not own a motor car but who purchases, certain goods. Because of the natural consequence of good business, commercial firms pass on the increased cost of the motor vehicles that they use in their businesses by adding that increase to the cost of the goods that they produce. So the customer carries his share of the burden of the increased tax. The overall effect is to depress living standards. Having regard to the history of the. motor industry over the last 14 years I strongly urge the Government to watch the industry very closely and, if signs indicate a slowing down of any consequence, to take immediate action to adjust the position. However, if the sales tax has been increased only to extract more revenue from the already overtaxed motorist I suggest that the Government could better achieve its purpose by increasing sales tax on luxury vehicles and by increasing customs duties on imported vehicles.

In the field of social services the Government has been mean to the extreme. The small increases in benefits which the Budget provides are a disgrace to the country. In his Budget Speech the Treasurer (Mr. Harold Holt) made great play of the prosperity of the country, as did also the Minister for Housing (Mr. Bury). They stated that in the last year wages and salaries had increased by 9 per cent., company income by 10 per cent., farm income by 26 per cent, and the gross national product by 9 per cent. They stated that our overseas balances were at a record high of £854 million. Yet in spite of all those increases, the addition of 5s. to the base pension represents an increase of less than 5 per cent. It is obvious on the Government’s own figures that the most needy section of the community is not to participate in the nation’s prosperity to the extent that it should. Recognising this fact many Government supporters have endeavoured - without success I suggest - to justify the Government’s miserly action. In his speech in this debate the honorable member for Sturt (Mr. Wilson) said, with tongue in cheek I suggest -

All benefits to pensioners can be brought to nought if the prices of the goods they have to buy to live on rise rapidly. Therefore, those in receipt of social service benefits have a vital interest in the policy which has been adopted by the Government of taking such steps as it can te prevent an increase in prices.

In saying that the honorable member knew full well, as does everybody else in Australia, that prices of most goods and services are increasing daily. He knows also that by increasing television viewers’ licence fees, telephone rentals and excise duty on tobacco, all of which in varying degrees affect pensioners, the Government has joined with and given the green light to big business to continue the price increase rat race.

While on the subject of social services I wish to refer to the Government’s attitude to aged couples where the wife, due to her age, is not eligible for a pension. In those cases the Government expects the couple to live on the princely allowance of £6 a week. I ask members on the Government side of the House what their reaction would be if their parents were placed in this starvation category. It is bad enough that this situation should prevail but it is shocking to know that the Government did not even consider these unfortunate people when it framed the Budget. Last February I asked the Minister for Social Services (Mr. Roberton) upon notice -

  1. How many wives of age pensioners are ineligible for the pension because they have not reached 60 years of age?
  2. How many of these wives are receiving a pensioner’s wife allowance?
  3. How many married male age pensioners are in receipt of the additional 10s. per week single pensioner allowance because their wives are ineligible for a pension?
  4. What would be the total overall difference in cost if all wives of age pensioners, regardless of age, were granted a full pension?

On Thursday, 19th March, I received the following answers -

  1. Information is not available as to the number of wives of age pensioners ineligible for pension on account of age.
  2. On 10th February 1964 there were 3,632 wives of age pensioners receiving wife’s allowance. This figure would include a small number of wives over 60 years of age who are ineligible for pension for reasons other than age. 3 and 4. The information is not available.

It is obvious from that answer that as late as 19th March this year the Government did not know how many people were involved in this situation and consequently had no idea how much it would cost to adjust the position. I believe that the position still prevails and accordingly the Government stands condemned for its complete rejection, without thought or investigation, of the needs of these unfortunate people.

I have read very carefully and with great interest the speech made in this debate by the Minister for Labour and National Service (Mr. McMahon). I am surprised and disappointed to note that he made no reference whatever to the important subject of automation. I trust that this is not an indication that the Government proposes to allow the human and social problems associated with this new industrial technique to solve themselves. The Budget states that the Government expects continued growth and expansion. The Minister said -

We make no apologies when we say that considerable growth and expansion remain the major policies and objectives of the Menzies Government.

If the Government’s hopes are to be realised, as a natural consequence output must rise and new plant and equipment will be required. Such new plant will most certainly be more modern and efficient than plant currently in use. This means more automation. I have no quarrel with this situation because I am well aware, as is any thinking person, that if we are to win export markets for our manufactured goods we must use the most modern production methods. However, I am fearful that the Government will wait until we are hit by the natural social consequences arising from automation before it takes steps to find adequate adjusting remedies. Already new labour saving equipment is being used in the clerical field. Manufacturing industry is becoming more mechanised and efficient. On the waterfront the turn-round of ships is being achieved more quickly and with the use of less labour. This is due to the mechanisation in the industry and is increasingly evident in ray district of Port Adelaide. I ask the Government: What is to happen to the surplus manpower when we reach production saturation point? Other highly developed countries have reached this point and, because no thought was given to the social problem, great hardship and suffering have been caused to a big section of the community. I appeal to the Government to see that a similar situation does not arise in this country. I make these remarks because the Government has become famous for locking the stable door after the horse has bolted. My object in raising this issue is to impress upon the Government, as a matter of urgency that it must now - not next year or the year after - constitute an authority to study the important and drastic changes taking place in industrial and business techniques. I am pleased that at least one member of the Government parties - namely the honorable member for Lyne (Mr. Lucock) - is alive to the fact that we face a problem in relation to automation. The honorable member, in his speech on the Budget, said -

I_ say frankly that I believe that we in Australia are not at present giving sufficient consideration to the problem of automation.

I agree entirely with his remark and commend him for making it. However, I do not agree with his suggestion that a committee consisting of members from both sides of this Parliament be appointed to look into the matter. I believe that this matter is so important and the problem is so complex that we require a team of experts to solve it.

Consequently, I suggest, with respect but with great sincerity, that a section of the Department of Labour and National Service be established as a permanent organisation equipped to deal with the effects of automation and . mechanisation and to coordinate the measures that must be taken to replace labour and overcome the social problems involved. Such a section should establish an advisory committee consisting of representatives of the trade union movement, employer organisations and Federal and State Governments. When problems concerning any particular industry are involved, representatives from that industry, on an employer-employee basis, should be co-opted. I feel that I can state with some certainty that the trade union movement would be happy to co-operate in a scheme such as the one I have suggested, and I have no reason to believe that employer organisation would refuse to play their part.

I shall now make some comments in connection with the Department of External Affairs, with particular reference to aid to underdeveloped countries. I use as an illustration our present commitments in South Vietnam. On one hand, the Government suggests that the use of military force is the only answer. In fact, it is actually subscribing to the use of military force. We members of the Opposition believe that Australia could play a better and more positive role, and have more chance of success, by using its influence to seek a political and social solution. I have always held that view, but I am now more than ever convinced of it, following my recent visit to the area as a member of a delegation from this Parliament.

Before I go any further I want to make it quite clear that one of my pet hates is any person who comes to Australia for two or three weeks and then returns to his home country and sets himself up as an expert on what is happening in Australia. I do not want to put myself in Gilligan’s place and try to set myself up as an expert on South East Asia after spending only a very brief time there. I wish to submit to the House some views on what I found out, and to explain to honorable members how those views were obtained. I had 30 or 40 questions which I asked everywhere I went. If I received a 90 or 95 per cent, answer one way from people who had been in the area and knew it, I assumed that that was a reasonable basis for saying that that answer represented the general view in that area. Thanks to the Minister for the Navy (Mr. Chaney), who was in charge of the delegation, I had every opportunity to put these questions to people in various fields, such as our own military and civil experts, the attaches from all of the governments that are represented in South Vietnam, the military and civil representatives of every country represented in South Vietnam and newspaper reporters from all over the world.

I wish to convey to the House an idea of the questions that I asked. One of the questions that I asked was: What is your opinion of the split between Soviet Russia and China; is it in fact a real split or is there a possibility of it being a political hoax? I am happy to say - and I think all honorable members will agree with me - that I received the same answer from one end of South East Asia to the other; namely, that it is more than a split. It is a serious split; it is getting worse every day.

Another question that I asked after flying over the area was: Is the old story that everyone heard at school - of South East Asia being overcrowded - true? In every instance - even from the governments themselves - we received the answer that in these countries there are thousands of acres of good fertile land that can be used very profitably and that the old story of South East Asia being overcrowded is a fallacy. That idea does not exist any more in my mind, and it does not exist in the minds of the members of the governments of the countries that we visited.

Perhaps the most important question that I continued to ask was: What percentage of the people have any particular political allegiance? I am not referring specifically to South Vietnam. The answer to that question was: Between 40 and 50 per cent. Then I asked: What percentage of all the people in South Vietnam would have any idea of what the present struggle in Vietnam is all about? The answer to that question - sometimes it came from members of the government themselves - was that at least 30 or 40 per cent, of the residents or natives of South Vietnam did not even know what the present struggle was all about. Yet it has been going on for more than 20 years.

The consensus - the history of the country proves this - is that since time began this country has been continually in a state of civil war. The only times when it was united were when one of its neighbours invaded it or when it decided that it was its turn to invade someone else. The almost general opinion - this applies to our American friends, too - is that the situation in Vietnam is in effect a civil war and that there has been a civil war on and off for hundreds of years.

But the difference between the present situations and the situation hundreds of years ago is that hundreds of years ago the civil wars were fought with clubs and sticks and the rest of the world was not interested, but now the civil war is fought with modern weapons, including aeroplanes. In addition, South East Asia has become a strategic area for both the Eastern world and the Western world. Added to the civil war is the fact - neither side makes any bones about this - that the United States and its allies, on the one hand, are helping one side, and China and its friends, on the other hand, are helping the other side. There is no doubt about that.

There is one particular point that worries me. I put this to the Minister for Repatriation (Mr. Swartz), who is at the table, because it is the opinion of almost 100 per cent, of the people in the area who should know - including plenty of our own people. It can be checked easily to see whether I am wrong. The point is this: If the present situation continues and if the present military strategy continues, our position will become worse and worse every day. Most people over there think there will be further coups, and that eventually - it may not be this year, but it may be next year - we will have a situation in which a new government will come to power and will make a deal with the rebels - the Vietcong or whoever they may be - from a position of weakness. We should not wait until such a situation develops. I realise that finding a political solution will not be easy. I know that it is almost impossible for the United Nations to intervene, because China is a party but is not a member of the United Nations and would object to such intervention. I know also that some of the parties to the dispute do not want another meeting of the Geneva conference. I do not mind which neutral body goes in to negotiate a settlement; but I believe that the sooner a settlement is negotiated the better it will be for all the people who think as we do.

Sooner or later - maybe this year, next year or in ten years’ time - the shooting will stop and the country will, we hope, settle down. That will be the time for Australia and its allies to give some real aid in the fields of medicine, road building and transportation. The greatest need will be in the field of education. I believe that, when peace comes to this unfortunate country, the side that can give the greatest assistance in education, whether it be the free world or the Communist world - I hope it will be our side and that we will teach not only the A.B.C. but also the benefits of democracy - will eventually determine the political allegiance of the country.

In conclusion, Mr. Deputy Speaker, I trust that, following the clear statement made on Monday last by Mr. William C. Battle, the retiring American Ambassador lo Australia, that America would welcome a Federal Labour government in Australia-

Mr Mackinnon:

– He did not say that at all.


– Let us have a look at it. I trust that this will be accepted by Government members and that we will hear no further insinuations from Government supporters that the American Government distrusts the Australian Labour Party.


.- 1 was interested to hear the remarks of the honorable member for Port Adelaide (Mr. Birrell), particularly those relating to South East Asia. It is quite evident that he went there eager to learn something about the conditions of the people, their politics and their future prospects. Being the member for Port Adelaide, I have no doubt that he will have many more opportunities to become more versed in the real problems that beset those countries and the peoples that live there. I was certainly interested, also, to hear him say that the people of South East Asia, in his view, were not interested in coming to Australia because they had large areas of fertile land available for cultivation. That was my experience. I privately went through the areas the honorable member mentioned and it is quite evident that Burma, Thailand, South Vietnam, Cambodia and other countries in this area comprise the rice bowl of Asia, and certainly of South East Asia. Honorable members may recall a television programme presented in Canberra some six or eight months ago when Mr. Christian of the Commonwealth Scientific and Industrial Research Organisation, Professor Oliphant and one other discussed this problem. They came to the conclusion, as I did when I was there, that there was ten times more arable land in South East Asia uncultivated than we could find in Australia today.

One of the questions I have asked people in South East Asian countries - I have asked it in Singapore, Kuala Lumpur, Bangkok, Saigon, Taipeh and Tokyo - is how many South East Asians want to come to Australia. We frequently hear - we have heard it in this Budget debate - a good deal of talk about the so-called White Australia policy, which does not exist. We hear a good deal of talk about these people wanting to come to Australia, to the north west of Western Australia and to the north of Queensland, because we are finding riches in these areas that are apparently needed by South East Asians. When I asked my question of these people, they all said: “ We as a people are like the Australian people. We like the country of our birth and infant nurture and we want to stay in it, just as Australians want to stay in Australia.” I cannot accept the thought that Asians will be running to Australia in their hordes at the first opportunity, because they have, particularly in Indonesia, a much richer land surface than we could ever hope to have in Australia. Their water supply is regular and frequent. We have the largest island continent in the world, but the average rainfall throughout Australia is only 9 inches and it is only 16 inches in the areas that we cultivate regularly. These are very small average rainfall figures compared with the rainfall figures of Indonesia and other countries in the tropical and sub-tropical areas.

I support the Budget introduced by the Treasurer (Mr. Harold Holt). I think that this is the best Budget that he has presented to the Australian people and for that reason alone it has generated less comment by newspaper scribes and newscasters than has any other Budget since 1959. The reason for this is simple enough: It is a good Budget for Australia for the year 1964-65. The honorable member for Port Adelaide supported this argument with some reasons. I refer the honorable member and the House to the report of the Reserve Bank of Australia which most of us received quite recently. I think it was last week. This report tells us that in 1963-64, as compared with 1962-63, our exports rose by almost 30 per cent, to a record figure of £1,374 million. At the same time, according to the report, our imports rose to an almost record figure of £1,124 million. The rise in our imports was only 9 per cent, against the rise in our exports of 30 per cent. Therefore, there was a difference between the amount spent on imports and the revenue received from exports of £250 million. This is not a bad year for a Treasurer who has to present a Budget to the people of Australia.

The terms of trade of our primary produce, which we sell overseas in ever increasing volume, improved by 13 per cent, over the result in 1962-63. The value of wool exports rose by 30 per cent. I think that figure was mentioned by the honorable member for Port Adelaide. The value of wheat shipments - there were particular reasons for this - was 60 per cent, higher than we have ever known. The export of motor vehicles - this is a secondary industry product and an export about which we hear very little - increased by 50 per cent. Civilian employment increased in 1963-64 over the previous year by 142,000. Unemployment - the factor about which the Opposition endeavours to paint pictures of gloom - fell by 33 per cent, last year and the unemployment figure is now at the record low level of 1 per cent, of the work force.

I would refer those honorable members opposite who delight in painting these pictures of gloom to a report made by the President of the Australian Council of Trade Unions, Mr. Monk. It can be seen in the “Sun” of May, 1960. He said that the unemployment figure could easily reach 1.5 per cent, of the work-force without causing any deterioration in the status of the Australian workers. In his view - in my view, too - there are workers who suffer from chronic neuroses which prevent them from working continuously and there are workers who move from job to job. In Mr. Monk’s view, an unemployment figure of 1.5 per cent, of the work-force was reasonable. Today, 1 per cent, of our work force is unemployed. This is a half per cent, below the figure mentioned by Mr. Monk. Wages and salaries increased during last year by 9 per cent. Farm income increased by 26 per cent. Our Gross National Product, which is the measure of the ability of this country to compete with its overseas competitors, increased by 9 per cent. The sale of cars rose by 16 per cent. So the figures tell the story of a healthy, buoyant economy.

I come now to the amount to be spent on defence. I have heard a deal of criticism from this side of the House concerning what the Government is doing in regard to defence. This year we are to spend £297,800,000, which is £99,000,000 more than was spent in 1961. This represents a 50 per cent, increase. I have heard the Prime Minister (Sir Robert Menzies) and other Ministers tell Opposition members and backbenchers on this side of the Chamber that, because this could be an age of technological warfare and as that type of warfare would result if war was started, we just cannot buy the equipment off the shelf. It does not hang on trees, nor is it sold from ordinary stores. Therefore, an increase of 50 per cent, in our defence spending since 1961 is not a bad effort. I forecast that there will be a considerable increase in our defence budget for next year.

As I have said, and as I hope I have proved to the House, our economy is in a fine state and is very buoyant. But, inflationary pressures remain with us and were with us in 1963. Thus, the Budget reflects mild restraint so as to ensure that growth is reasonable and not galloping. We all saw the results of galloping inflation in 1959-60. We saw the attempts by the Government to restrain this growth. I believe that the restraint of those days was applied too late and too harshly. I applaud the Treasurer for seeing the possibilities of inflation in 1964- 65 and he has endeavoured to ensure that growth will be reasonable in this financial year. We all know that the work force is such that the unemployment rate is down to 1 per cent. Therefore, our growth in this financial year must be somewhat restricted compared with our growth last year. So far as defence is concerned, I do believe that Australia could have expected more sacrifices this year. But, as I have already forecast, it will be the intention of the Government, I feel sure, to add to our defence expenditure considerably in the 1965- 66 Budget.

I do not think there has been any factor greater than the increase of £1 a week in the Federal basic wage which would lead to inflation becoming rampant in Australia in the next 12 months. This increase of £1 per week per person adds to the economic structure of Australia, in the words of the Commissioners themselves, £100 million a year. Yet the increased taxes as requested by the Treasurer in this Budget amount to only £57 million. These taxes are to be collected from individuals and from companies. Therefore, it is my belief that more money could have been taken in the form of taxation from the Australian people this year, and frankly, I do not believe that the ordinary man - the little man about whom the Leader of the Opposition (Mr. Calwell) talked so deftly - will notice any difference in his weekly wage, except that as a result of the basic wage increase, he receives £1 a week more from 19th July last. In reply to the doubting Thomases opposite who are interjecting, I would like to give one or two instances and say that I cannot see that the little man as he has been called, will notice any effect as far as the Budget is concerned in his weekly wage.

A man with a wife and two children, who is earning £1,000 a year or £20 a week, paid under the old scale, without allowances, £51 4s. a year in the form of personal tax. As a result of the new Bud get, that man, without allowances, will pay £53 18s. a year in the form of personal tax, which represents an increase of £2 14s. a year, or1s. a week Now that he is getting £1 per week extra because of the basic wage increase he may be brought into a new scale; but if he is getting the same wage, £1,000 a year, as he was getting last year, the increase in the amount of direct taxation that he will pay will be1s. a week. The man on £2,000 a year - and now we are getting slightly past the little man of whom the Leader of the Opposition spoke - paid under the old scale of taxation £268 13s. a year. Under the present Budget, he pays £282 16s. a year. This is an increase of £14 3s. a year, or 5s. 6d. a week. So it is as we go up the scale. More money is taken from the higher wage earner and less and less from the little man about whom the Leader of the Opposition has been speaking in his questions in this chamber and his Budget speech delivered on Tuesday evening of last week.

All members of the Opposition have spoken about this little man. I would like to refer them to the growth of savings bank deposits in the last 12 months. It is not the big business magnate who puts his money in the savings banks. Companies do not put their money in savings banks. The man on £5,000 a year does not put all his money in the savings banks. It is the so-called little man about whom we are talking who puts his money in the savings banks. How much has he put into those banks in the last 12 months when things, apparently, were not as good as they were hitherto? The little men - the people who put their money in savings banks - deposited an additional £268 million last year. Converted into a weekly rate, that amount represents something over £5 million a week, or approximately £1 million a day on the basis of the five-day working week. I do not know where the ordinary working man, the little man, gets the money in order to be able to put that amount into savings banks in the past 12 months if he is as hard up as honorable members opposite have told us.

Another factor of which a great deal has been made by members of the Opposition is that we are resorting to indirect taxation to make sure that the little man pays for the things for which the big man should pay. I remind honorable members opposite that in the 1949-50 Budget presented by the Prime Minister and Treasurer of that day, Mr. Chifley, direct taxation represented 55.3 per cent, of all taxation levied, and indirect taxation was 44.7 per cent. What do we find when we look at the 1964-65 Budget? We find that direct taxation, which affects the big man and not the little man, has gone up from 55.3 per cent, to 60.1 per cent. Indirect taxation has been reduced accordingly from 44.7 per cent, to 39.9 per cent These figures are a refutation of the statements that have been made by members of the Opposition about the position of the little man. He is gaining, because his direct taxation has been reduced, as also has his indirect taxation, in this Budget.

We have also heard some remarks about what has happened with the National Welfare Fund. The honorable member for Port Adelaide mentioned this in his speech. He said that the Government is doing very little for the pensioner. Again, let us have a look at the 1949-50 Budget which was the last Budget presented by a Labour Government in this country. The amount that was set aside in 1949-50 for the National Welfare Fund was £93 million, which represented 3.4 per cent, of the gross national product. A quick calculation of the figures in this Budget - the Treasurer has increased the pension rate by 5s. a week - indicates that the National Welfare Fund figure represents 4.8 per cent, of the gross national product. This represents an increase of two-fifths. The pensioner and the repatriate are receiving 40 per cent, more today in terms of the gross national product than they would have received from the 1949-50 Budget presented by Mr. Chifley. I realise that these are statistics, but I cannot see any other way of illustrating what is being done by this Government in comparison with the measures that the Opposition would inflict on the people of Australia.

As to the increased telephone charges, I must agree with the sentiments that have been expressed on this side of the House that those who hire telephones should pay for them. The little man, who cannot afford and does not make application for a telephone, should not be taxed to meet the costs of a man who does want a telephone in his home. So much for the greasing of the fat pig about which the Leader of the Opposi tion talks. I believe that not only is the little man doing better under this Government than he did under the Labour Government but also that he realises it. The voting at the general election last December indicated, to me, anyway, that many of the so-called little men ‘voted for this Government. Honorable members opposite attack us, but that is their job. If we were on the Opposition side of the House - it will be many years before we are - we certainly would attack them.

I wish to make reference now to the Commonwealth Conciliation and Arbitration Commission and its decision that as from 19th June the basic wage was to be increased by £1 a week. It seems to me that a group of four men, admittedly after a lengthy hearing, added £100 million to the costs of the economy of Australia overnight. This additional cost was imposed on a stable economy, at a time when the state of affairs was such (hat the Consumer Price Index had risen by only .7 per cent, since 1961. I should like to ask the Commissioners several questions as to how they arrived at this decision. Prior to the making of the decision, Australia’s economy was stable and the outlook was brilliant. I believe that we were heading for a golden future, for a period when our exports of secondary products would have become more competitive than hitherto, and that we would have gone from strength to strength if that stability had been maintained in the economy. The first questions I would like to ask the four Commissioners who decided to increase the basic wage are: Why did two of them decide that it should be increased by 10s. a week? What procedure did they use to arrive at a decision to inject an extra £50 million into the economy? That is what a rise of 10s. would have meant. Why did the other two Commissioners decide to double that figure and inject £100 million in the form of wages into a stable economy? Obviously the terms of reference must have varied as between the first two Commissioners and the second two. There was no precision in the determination made by these gentlemen. Why did the Chairman of the Commission - who, in my opinion, should maintain the status quo - decide to support the higher figure? Why did this one man arrive at a decision that cost Australia another £50 million. That is what his casting vote has cost the Australian economy.

Mr Reynolds:

– The country is very prosperous. We can afford it. You have said so.


– The country is prosperous. We had a stable economy when the decision was made. I do not believe that, economically, we can stand in isolation. We must have some regard for international economic conditions, for the economies of the peoples to whom we sell and the peoples from whom we buy. I hoped that the Commission would give the same thought to the affairs of Australia as I have done. The primary products that we export are subject to considerable fluctuations in prices, due to the fact that we sell them on uncertain markets. Some years ago we saw the price of wool go to as high as 140d. per lb. and two years ago we saw it drop to approximately 56d. per lb. Now it is about 70.2d. per lb. Fluctuations of this kind trouble Australia and they must trouble the workers if some regard to our export difficulties is not given by those people who can add to our costs by increasing the basic wage and margins. In fact, I am coming to the conclusion that at least some of the members of the Commission either are irresponsible or just do not understand the effects that their decisions can have on the economy of Australia.

We hear complaints from unions that their members want more out of profits. I wonder how many honorable members opposite realise that the proportion of the gross national product represented by profits, now 8.9 per cent’., is decreasing and that wages account for £4,000 million of a gross national product of £8,700 million. I cannot see how members of unions can expect to get much more out of the profits of companies. I suggest that the Arbitration Commission obtain stronger views from economists about what should be done when claims are made for increases in margins and the basic wage. I know that it is argued that the benefits of increases in productivity should be spread amongst the workers. I agree that this should be done and there are three ways in which to do it. One way is an increase in wages, another is a decrease in prices and a third is a decrease in profits. There are charts available which indicate that the percentage of the gross national product represented by profit, or company income, has decreased over the last four of five years. Therefore, the benefits of the increase in productivity should go to the workers in the form of either increased wages or reduced prices. I believe that this year we were on the brink of seeing a reduction in prices. I have already stated that the Consumer Price Index had not increased by more than .7 per cent, since 1961. Further, there was an indication in the report of the Reserve Bank, which was circulated to all honorable members, that overall wholesale prices had dropped in the last three years. These things are important to Australia, and also to the workers of Australia if they want continuity of work.

The addition of £1 to the weekly wage packets of the workers puts them in a new tax bracket and increases prices. We have only to look to the announcement made on 29th July in Victoria - no doubt similar announcements were made in other States - for evidence that price increases can be expected as a result of this increase of £1 in the basic wage. The Deputy Chairman of the Hospitals and Charities Commission of Victoria said that the Commission would have to increase its charges because the increase in the basic wage had added £1,114,000 to the Commission’s wages bill, and that this figure did not include any factor for overtime and other allowances. Therefore, the worker will be charged a little more for the time that he, his wife or his children may spend in hospital. We have seen in the Press a statement by the Postmaster-General (Mr. Hulme) that the additional cost of this increase to his Department will be £7 million a year. Who will pay this extra £7 million? The little man will pay it in additional charges. That is why telephone charges have gone up. The Premier of Victoria has stated that his Government will need an additional £4,000,000 to pay the higher wages of State public servants resulting from this increase in the basic wage. This figure, too, does not include overtime and other allowances. The little man has to pay for all these things. The extra £4 million needed by the Victorian Government will come partly from increased train fares. The man on £5,000 a year does not travel very often on a train. It will come partly from increased tram fares and increased bus fares, and the man on £5,000 a year does not travel on trams or buses very often.

The little man will have to pay for all these things. I emphasise that these extra charges will not go to swell company profits, as is suggested by the Opposition. I would strongly urge Opposition members, and supporters of the Government for that matter, to ascertain what the Consumer Price Index is now, following this increase in the basic wage. I am sure they will find that Government departments have had to increase their charges to the little man. Secondary industries have yet to increase their charges. These are the things that I wanted to talk about, but time is limited.

I should like to quote some of the remarks made by the Commonwealth Conciliation and Arbitration Commission in its decision on the 1961 basic wage case when a rise of 12s. a week was granted. The Commission said -

It was made fairly evident that movements in the basic wage should reflect or be adjusted in terms of change with the consumer price index.

With this I agree, because I have already said that the consumer price index had risen by . 7 per cent. since 1961. The report that I received reveals at page 486 that the Commissioners said -

In fact there was no such increase in prices.

At page 488 they say -

We have endeavoured to look at the economy in the round - whatever that may mean - and base our decisionson its capacity since 1961, its capacity now and its capacity for the predictable future.

Again I say that they should get some expert decisions from economists, because economists tell us, as I said earlier, that there are three ways of distributing this additional productivity. One way is to give additional money to the worker. He is the fellow who has produced the goods and therefore, he should partake of some of the increases as a result. But there are other ways of giving the worker more money. One way is by ensuring that there are lower prices. Another comment of the Arbitration Commission that I should like to include in “ Hansard “ is also taken from its report. It states -

Just as in 1961 there was a distinct departure from earlier approaches, so might it be necessary for the Commission in different circumstances to alter in a minor or even major way the approach of 1961, and this we now affirm.

From that, I would say that the Commissioners are saying that they will make their own rules for arbitration. I think it is time that the Government looked at the Conciliation and Arbitration Act to make sure that the Commissioners do not make their own rules. Somebody mentioned earlier that we appointed them, and this is true; they should not make their own rules when deciding such an important matter as a basic wage increase. These are the things that will affect the economy of Australia, not the Budget so ably presented by the Treasurer.


.- The honorable member for Balaclava (Mr. Whittorn) delivered a speech which could correctly be construed as a great display of party loyalty but hardly at any point, if at all, did he show any independent thought by making a critical and constructive analysis of the Budget presented by the Treasurer (Mr. Harold Holt). Actually, his speech seemed to contain two essential points: He began by stressing the tremendous achievement that had taken place in the economy during the past 12 months and the great prosperity that had been created in our economic structure. The second part of his speech contained a poor cry that the country was too broke to afford wage increases for the workers. That is, it was unable to provide the people who had created it with a share of this great prosperity about which he had spoken. Then, as if to absolve his conscience, he mentioned that over the past five years, the distributed profits by companies had fallen. But he failed to make any reference to the tremendous growth of reserves that had been salted away before profits were distributed by the monopoly units which have appeared in our community. These things must be taken into consideration when one is talking in terms of the prosperity in our community together with such matters as to whom, and how, shares are apportioned. I conclude my remarks on the speech made by the honorable member for Balaclava by saying that he was extremely critical of the majority decision of the Commonwealth Conciliation and Arbitration Commission which was in favour of an increase in wages for workers. Quite obviously one can infer, correctly, from his speech that had the majority voted the other way the decision would have been entirely acceptable. The point that I want to refer to is the constant ability of honorable members opposite to see grandeur in the Budget presented by the Treasurer - not only this Budget, but the Budgets that have been presented over the years.

When one reviews the economic policy of the Government over the years, and in particular analyses the Treasurer’s fiscal and monetary policies over that period, one is perplexed and concerned at the amazing facility with which he, on (he one hand picks us up and pats us and, on the other, knocks us down and scorns us. Consequently the nation limps and staggers in its growth, uncertain whether optimism is to be partially penalised and constantly insecure because of the indecision which clouds the future. Where the future will be and how we are to get there is more the result of the chance of the moment.

The sad story of the cyclical movement of the economy, of riding ever higher boom crests, of being dashed into ever deepening recessionary troughs of tremendous capacities created in hope to be dashed in despair, of promised growth and achievement turning into recession and stagnation has been the history of this nation in the Menzies’ period. It has been a period of politics without principle or long-term purpose, politics which seek popularity at election time but show a cavalier disregard for the responsibility owed to the people between elections.

Mr Chipp:

– You don’t really believe that, do you?


– I thought this out very carefully, lt is all very well for the Government to throw this country into a recessionary trough of despair, as it has so frequently done over the years, and then to speak with hypocritical pretention of a growth rate artificially stimulated out of an unnatural trough. Of course there must be a greater than normal growth rate out of stagnation once this movement is encouraged but the plain facts are that the growth rate has not pulled the nation to the point of achievement which should have been attained through proper and responsible husbanding of the nation’s economy. What it provides is a rate of growth which quickly peters out. Indeed, the nation has always reverted to its pedestrian movement in too quick a time. The growth of past years was due largely to the motor vehicle indus try. This is not a substantial basis on which to build the future and last year’s growth is about to ease up. The Governor of the Reserve Bank makes this point at page 9 of his annual report as follows -

But capacity to produce will grow less rapidly than in 1963-64.

He is referring to the current year. The Treasurer, always evasive when it comes to facts, puts the point in mild terms -

  1. . we have every good reason to expect a further good increase in production this year.

A “ good increase “, mind you, but no promises of improved or equivalent performance. He knows full well that the inadequacy of his Government’s economic programme, its complete lack of direction and lead to the community will result in the usual petering out of economic advance to a steady plodding performance.

Why must our movement forward be so unspectacular in the long term - in the important perspective? In comparison with other countries of the world we are trailing our coat tails in the matter of growth. The rate of growth of the German Federal Republic has been 6 per cent.; of Italy, 5.9 per cent.; of Japan, 9.4 per cent.; and of the U.S.S.R., 6.5 per cent.; but Australia is lagging at somewhere about 4 per cent., if we can manage that.

Mr Chipp:

– How would you stimulate growth?


– If you will restrain yourself and wait you will be enlightened. In a more specific field - that of our industrial growth - our position is greatly inferior to that of other nations. Surely this unsatisfactory situation should cause alarm in the Government - alarm to be followed by prompt remedial action. As a clear illustration of our inferior status in this sphere of performance let me cite the following statistics which indicate industrial expansion between 1959-60 and 1962-63. Industrial expansion in Australia was 1 1 per cent.; in Sweden, 15 per cent.; Norway, 22.6 per cent.; Netherlands, 19.2 per cent.; Japan, 62 per cent.; Italy, 40.5 per cent.; West Germany, 23.3 per cent.; France 21.7 per cent.; Canada, 12 per cent.; and Belgium, 17.3 per cent. That leaves us comparatively in a rather poor position.

It Is significant that the countries today that are really going places are those that have a planned economy. Think of the nations which are surging ahead - France, Germany, Japan, to mention only a few. Think of such nations and you are thinking in terms of planned economies. But, unfortunately, Australia is one of the few countries which does not have and refuses to accept a planned economy. This is a shortcoming which is to her expense. Why does this nation not plan its economy? Why does it not give goals and objectives to business and to industry? Why can it not define definite purposes and courses for our economy? Such planning is to the advantage of the people, for only under such a system will a closer approach be made to security and to a vastly enhanced Tate of improvement in the growth of our real wealth.

We need a policy of planning which will increase our productive achievements by, among other important considerations, making provision for a better distribution of incomes in the community. We need a scheme that will overcome the present unfair distribution of income in the community where 66 per cent, of the taxpaying income earners receive only 43 per cent, of the actual income earned; where 18 per cent, of the income earners representing the top brackets of incomes enjoy 37 per cent, of the total tax deductions; and where, as my esteemed friend and colleague, the honorable member for Yarra (Dr. J. F. Cairns), has frequently pointed out, 1.7 per cent, of the taxpaying companies earn 61.95 per cent, of the total company income.

Of paramount importance to such a scheme of planning would be the definition of priorities for investment and development so that the things which we should be achieving - the tangible things, the substantial things, the things of long-term benefit - will in fact be achieved. These things are not being achieved on anywhere near the scale they should be, as things now stand.

What can be so dirty about this word “ planning “ when applied to the economy? What can be so dirty about it that the Government shudders and turns away when it is mentioned as a proposition to be introduced on a worthwhile basis? Surely a system which brings us nearer to enjoyment of a better living standard overall is more desirable than the present top-heavy wealth structure of the community, with a few enjoying a lot and, at the other end, far too many not having enough. In such an economy, one in which the increasing wealth is compressed into fewer hands, the marginal propensity to consume decreases. The graph of growth eases off in its upward movement. Effective demand slows down and so then does growth. But in circumstances such as ours, there is no need for it to ease up. By redistributing income on a more equitable basis effective demand can be stimulated - and not demand for the expensive and frivolous luxuries consumed excessively as they are when there is a far too disproportionate distribution of spending power. Effective demand for valuable capital works can be stimulated by capable wielding of fiscal and monetary policies so that public enterprises of social benefit, not only in the short-term view but most essentially in the long-term consideration, will be undertaken.

What paramount principle could have deterred the Government for so long from embarking on its moral mission to bring greater equality into the community, greater viability and substance to our growth? What could have deterred it from a moral mission which it criminally ignores? The present inquiry on forms of economic planning, as everyone well knows, will be largely contemporaneous with the advent of the restrictive trade practices legislation and other legislation undeniably needed in the community but which, when finally presented, will be devoid of any teeth. Like all such forms of legislation it will be conceived with caution, its gestation will be difficult and from birth it will suffer from anaemia.

But then what else could one expect when we have in power the present Government, the members of which are the puppet playpieces of the powerful capitalists? It is a government subservient to its faceless financiers - the Reg Ansetts, the Sir Ian Potters and, of course, the Government’s champion of the yellow Press, Sir Frank Packer. These people and their ilk stand to gain and have been gaining handsomely in the present inequitable structure of our economy. Let there be no illusions as to the power of the faceless financiers of the Liberal Party who manipulate the members of that Party as the puppet master manipulates his marionettes. The powers at the top, operating with cold deliberation and precision, define the policies, actions and future of that Party so that, those policies and actions are directed towards their own interests.

Of course, members of the Government parties deny these things. They like to think of themselves as individualists. In actual fact they are the pliable pawns of the Prime Minister (Sir Robert Menzies), the powerful master who makes and breaks ministerial futures with the calm and disinterest with which one switches on and off an electric light. So they flaccidly submit to the whipcrack of their master, the Prime Minister. There is no democratic decision making process to discover the policies of their preference. The back benchers are rarely heard and even more rarely listened to in the party meetings. The Ministers fare little better; why, one was sent home to change his shoes recently because the Prime Minister did not like the colour of them.

But although the people in Parliament have little voice and even less influence where the Prime Minister and his policy are concerned, there are those outside, the (influential few who hold the economic power at the top, who do have a lot to say and who do have a lot of influence. Let me give a few instances which have come to the public notice of how Government policy has been blatantly influenced to the satisfaction of outside interests, and - and this is most important - by those outside interests. Let me quote, first, an extract from an article by R. J. Blandy entitled “ Big Business in Australian Politics “, which appeared in the 1959 issue of the Australian Universities Magazine -

For instance, Mr. A. M. Simpson, President of the Associated Chambers of Manufactures of Australia, says that the association of government policies with manufacturing industry has created the necessity for personal liaison with members of the Federal Cabinet whose departments embrace activities connected with the industry.

Then Mr. Blandy went on to show how government departments had been influenced. Then I refer to the publication “Nation” of 12th January 1963, in which appeared an article entitled “ The Lobbying Bureaucracy”. This article referred to an address given by Mr. J. N. Walker, the outgoing President of the Associated Chambers of Manufactures of Australia, in which Mr. Walker said -

Our recommendations submitted formally to the Government in January this year, were adopted virtually in <full. The ‘ interim budget ‘ of February, which was sustained in August, included almost every single proposal submitted by A.C.M.A. to Ministers earlier in the year … I recall that during one discussion which I had with the then Acting Prime Minister, Mr. McEwen, he spoke in grateful terms of the close association which his officials had with officers of the A.C.M.A.

Then I refer to Sir John Allison’s Seventh Queale Memorial Lecture in South Australia in 1960, in which he related how, as a member of various Government committees, he, being a prominent financier and a member of the Associated Chambers of Commerce of Australia, was able to influence the direction of important policy. He concluded -

The important part about this is that the Government turned for advice from outside itself to the business world.

So let us not deceive ourselves and let us be honest about these important considerations.

These are the people, the respectable faces of big business, who sling heavily to the party funds of this big business Government and who find the return on their investment worthwhile. We have a system of remote but effective control of the nation by the economic emperors. The Government may be in office but it holds only nominal power. Is it any wonder, then, that the nation finds that its future is being built on a marshmallow base because of excessive private consumption while capital investment lags seriously? On this subject the Deputy Prime Minister (Mr. McEwen) is unequivocal in his criticism. He is less specific in his proposals for action. The “Sydney Morning Herald” of 24th August 1964 reported a statement made by him at a luncheon meeting of the Executives Association of Australia. The newspaper report read -

Business leaders were warned yesterday by the Deputy Prime Minister and Minister for Trade, Mr. J. McEwen, that investment in Australia’s manufacturing industries was not rising fast enough. . . .

He said that in recent years Australian manufacturing industries investment had been rising at the rate of 7 per cent, annually.

This compared unfavourably with Britain’s 8 per cent., France’s 13 per cent, and Italy 16 per cent “ Australia has much greater needs than all of these countries “, he said.

But of course he does not propose to do anything because he is dominated by the big business interests. The lopsidedness and flabby corpulence of our economic structure is predisposed to poor performance. Let me remind honorable members that, symptomatic of this flabbiness through priority given to spending in negative fields, last year £111 million could be found for tax-free advertising expenditure while we could grudgingly find only £88 million for health. We are miserly in our provision for education and utterly parsimonious in our attitude towards social service pensioners. Yet the advertising industry estimates that by 1970 it will have increased its expenditure by 102.7 per cent, and that it will spend £225 million in that year. One wonders how health will be faring then.

Enormous amounts of money are spent in wasteful advertising, specially designed to entice people to buy something they do not want and often cannot really afford. Is it not readily agreed, after all, that this kind of advertising is a wasteful element in the community? Look at our hire purchase debt if you want proof of the effect of motivational advertising upon the economy. As a result of people being inveigled into buying through this kind of advertising there has been a tremendous growth in our hire purchase debt. In retail business alone we have seen an increase from £83.2 million in June 1957 to £211.4 million in June of this year. This is a clear indication that these fringe banking institutions should come under some form of credit control. At present they are completely independent. When the Government tries to introduce monetary controls in the community they are allowed blatantly to continue their activities outside the ambit of those controls.

It is the sloth, the waste, the inefficiency that we must overcome before real progress can be made. They must be overcome not just so that we may enjoy the clear view of pure and smooth efficiency for its own sake, but rather as a definite movement towards a better distribution of wealth in the community and the elimina tion of exploitation, whether in the direct form of employee by employer or the less direct form of consumer by unscrupulous advertiser. The distribution needed is one which provides for investment in things of positive value instead of negative ostentation. The time is well and truly ripe for a system of economic planning which will re-route excess and wasteful private consumption into- the fields of capital investment for development which should receive priority. It takes little imagination to appreciate the social and economic waste of consumer goods which are run off the assembly lines of mass production, flashy and flamboyant, with high prices and having such special inbuilt features as premature obsolescence. This premature obsolescence is carefully designed to make the product wear out before it should. Think of all the factors of production that are tied up in feverishly producing consumer goods that will wear out quickly and thereby create unnecessary demand. It would be far more beneficial to the community if some of these factors were released for the production of durable goods that could be directed into more productive and more valuable development works.

I suggest that what is needed is a blueprint for a planned economy based on a broad concept of our problem of national development. On a more intimate basis, we need a system that will advance personal welfare and the people’s living standards - a system under which wage earners can obtain homes without undue delay and on reasonable terms. Homes should be available on no deposit to people in the lower income groups where income is less than, say, £1,000 a year. We need a system that will abolish a situation such as that existing at present, in which a few can afford luxurious holiday homes as well as a permanent residence while many cannot afford any sort of home despite sincere effort to save sufficient to purchase one. I do not suggest that we take holiday homes from their owners. Indeed, our ultimate aim should be the provision not only of holiday lodges at reasonable rentals for those in the lower income brackets and their families but also easy finance for the purchase of a home. We should provide, not homes that are little better than cramped biscuit boxes, but houses with adequate space and sufficient rooms to enable a family to live in comfort and dignity.

We need a system under which pensioners will be treated as valued citizens who have helped to build up the heritage of this great country instead of, as at present, as second rate citizens who are to be herded into isolated antique shops that are described as old people’s homes. These people should not be isolated from their environment and their families in the way in which they are isolated at present. Our aim should be the improvement of- their material welfare, and the provision of cottages and small, aesthetically pleasant settlements in suburbs and towns where pensioners may live without having to be widely separated from their children. In our society, as” it stands today, the construction of luxury hotels has preference over the elimination of hovels and slums. Opulent holiday haunts have priority over homes for the people. Something positive must be done to re-adjust the scales and to ensure a more realistic and more responsible balance.

The profits gouged out of our economy by monopoly organisations and their near relations, the cartels and trade associations and their ilk, must be attacked for the public benefit. This action is urgently needed and long overdue, and it would be taken by a government that sincerely wanted to do something of value for the nation. Professor Hunter has pointed out that Australia has a higher degree of monopoly activity than any other country and, in terms of monopoly profits, restricted output and artificially high, prices, the national cost must be tremendous. The existence of these powerful economic groups, which influence production quotas, distribution and prices, and therefore determine our very standard of living, shows that the forces governing the movement of our economy are far from free. Indeed, when we are considering a plan for our economy, these powful economic groups must be carefully scrutinised. Groups such as these nearly ruined the French experiment because of their recalcitrant ways. This recalcitrance stems from the independence of their economic power, which, supported by colossal reserve funds, enables them to ignore, and is unaffected by, government monetary policy.

Surely this lack of free forces in the economic flow - this bludgeoning of the community - demands government intervention. It demands intervention in Australia as much as in any other community, for the powerful forces that I have mentioned are rampant in this country today. If the income of our community is to have real purchasing power, something is demanded of the Government in the way of an effort to prevent the spiralling of prices that occurs when they rise without justification. In these circumstances, wage increases never catch up with the cost of living. Before the worker receives an increase, the Taxation Branch has taken a share, and by the time he is ready to spend the proportion of the increase that is left to him, prices have risen even more. In fact, far too many price increases are made without any justification - least of all, without any basis in the movement of wages. In this connection, I had hoped to quote rather extensively from “A Matter of Prices “ - a paper presented to the Australian and New Zealand Association for the Advancement of Science in 1959 by Dr. H. C. Coombs, whom, I am sure, everyone well knows. Time, however, will restrict the number of extracts which I can quote. This paper was published in “ Economic Record “ in the same year.

Mr Chaney:

– Give us a bit of Hayden.


– I shall content myself by quoting this passage - . . in . . . the United States during the recent business recession, . . . despite the fact that almost every indicator of economic activity turned downwards, .consumer prices continued to rise. Between August 1957 and April 19SS the index of industrial production fell by 13 per cent, retail sales by 5 per cent and unemployment almost doubled, but the consumer price index, and wage rates rose - by almost 3 per cent. The situation in Australia, though not as pronounced, is not unlike that in the United States. June figures reveal that the interim retail price index is 2.6 per cent higher than it was a year ago in spite of uncertainties in general economic conditions which suggested that the economy needed some stimulus if growing unemployment was to be avoided. In the past, periods of declining economic activity have almost invariably brought falling prices - even though the decline of retail prices has been much less than that of materials and basic foodstuffs.

Dr. Coombs went on to point out that this applies in Australia and that, despite the recurrent periods of recession, it appears that business interests in this community arc prepared constantly to raise their prices by between 2 per cent, and 3 per cent.

He also pointed out the tremendous economic dangers that are inherent in such a practice. I suggest that all these blights must be cast away. We must reach for growth. We must plan for properous progress. Now is not the time to hammer down our growth. The Minister for the Navy (Mr. Chaney) apparently wishes to be guided by me. He asked me to make some statements on my own initiative. I know that he did so sincerely, because he often asks me for my advice. I ask him to listen to these points. There is no need for toughness in this Budget, though, indeed, there is toughness in it. The economy can expand at about 8 per cent, annually without strain or inflation in view of the high level of savings, favorable overseas trade balances, likely capital inflow and the available manpower, which will expand at an accelerated rate in the near future because of the attainment of maturity by those who were born during the postwar expansion of the birthrate.

As one glances through the Budget Speech and the annual report of the Reserve Bank of Australia, one sees clear evidence of warnings of the problems of excessive liquidity in the economy, and its resultant threat of inflation and speculation. But it is not true to suggest that excessive liquidity exists. The dubious Treasury practice of including savings banks deposits m the money supply as a factor in liquidity -a practice condemned by most economists - given a wrong impression of our real situation. The significance of this point can be well appreciated when one realises that savings bank deposits rose by £268 million last financial year.

The Treasurer and the Governor of the Reserve Bank paint a picture of a ballooning building industry. But, once again, this is misleading, for much of the activity in this sphere is in the pipeline, since it relates to unfinished government building or office building. We have been advised by the Australian Loan Council that government building will taper off. We know from reading the newspapers that office building is now reaching saturation point and that excess office floor space is becoming available in the capital cities. This means that many of the factors in the building industry will soon be released for home building. So excess pressure in this field will be contained. Therefore, there is no need to damp down activity on account of this sector. The fears of inflation expressed by the Treasurer seem to be based on incorrect premises. The recent rise in the Consumer Price Index was due to seasonal factors alone. These were movements in the prices of meat and potatoes and also in rents. Therefore, there are no grounds for interpreting this rise in the index as a sign of general inflation. On these grounds, then, there is no need to damp down activity in the economy.

I believe that there is every reason for confidence and a belief that the future holds room for increases in productivity. The prospects for exports look good. The Director of the Associated Chambers of Manufactures of Australia has recently made a statement about the export prospects. It appeared in yesterday morning’s “ Daily Telegraph”. The Director is optimistic about exports in the current year. Increased exports, of course, mean increasing size of markets and therefore of scale of plant, and hence increased output. There are other signs of increased activity in the current year. These appear in adequate saving resources, adequate labour supply, owing to the reason that I mentioned earlier, and spare plant capacity. Let me remind honorable members that a recent survey made by the Bank of New South Wales showed that only 15 per cent, of manufacturers believe that their output and potential are limited by the capacity of machinery. It seems from these last few points and from what I have said before that the main barriers to growth are neither trends in the economy nor the trade cycle. Rather, the barrier comes from the Government’s stop and go policies - what Professor Kalecki of Cambridge as long ago as 1943 defined as government sponsored cycles.

Why, I inquire, in the light of these undeniable facts has a squeeze, in the form in which it exists in this Budget, been applied? The only inference that can be drawn is that it has been introduced to finance Government spending but one has queries in relation to that. Last night, the honorable member for La Trobe (Mr. Jess) in a trenchant attack pointed out that, although defence expenditure is supposed to have increased tremendously, one can hardly interpret that from the Budget Papers which have been presented to the House. If we are to avoid these recurrent stops and starts we must plan the economy. Priorities must be outlined. A properly appointed expert team forming a national economic development commission - call it what you will - operating in conjunction with the States should undertake such an investigation and should be responsible, in conjunction with the States, for seeing that the plan for the economy functions effectively. Its first objective should be an ad hoc survey of planning and co-ordination with the States for a period of about three years. Then it should outline a five year or a seven year plan for positive growth and progress within the community.

Decentralisation by public enterprise and, where necessary, by mixed enterprise should be undertaken. There should be encouragement to the private sector to decentralise by way of tax concessions, or some other form of stimulation, which the Government is capable of providing. Of course efficiency should not be sacrificed in such cases for then the aim of planning the economy would be completely defeated. That something along these lines is imperative is obvious from the lopsided industrial and population development that has taken place in the south east corner of the continent - in the Newcastle, Sydney, Wollongong, Geelong, Melbourne conurbation. Transport must be carefully analysed to eliminate as much as possible the inefficiency which blights it today, and thus to reduce production and distribution costs. In this country, with so very much to be done in the way of development, with so may resources untapped, there should never be a halt to our growth. There should never be recurrent unemployment. That these things do recur is a censorious commentary on the inadequacy of government action. I conclude by supporting wholeheartedly and without reservation the amendment proposed by the Leader of the Opposition (Mr. Calwell).

Sitting suspended from 5.48 to 8 p.m.

Minister for the Interior · Richmond · CP

Mr. Deputy Speaker, tonight I have much pleasure in supporting the Government’s Budget. In the course of my speech I propose to refute some of the arguments raised by members of the Opposition. Before the suspension of the sitting today we heard a speech from the honorable member for Oxley (Mr. Hayden). It was a tirade of extravagant expressions - expressions designed to breed class hatred and to show that there was a great degree of poverty in the country. The speech was intended to convey the impression that in Australia the ordinary man is under-privileged and has no rights. The honorable member’s speech had the same tone as other speeches we have heard from the Opposition. It was not very inspiring in this nation where we see progress all around us.

The Budget has a general tone of restraint. It is aimed at trying to limit the inflationary tendencies that are at present in our economy. You have only to look at the economic indicators, such as the demand for labour, the demand for materials, the production of various items such as motor cars, the high rate of liquidity in the community and the rate of retail sales to see that there is great stimulus in the economy and that unless a calming hand is applied by the Government, matters could get out of control. Newspapers and the general public are prone to look upon Budget time as a time for hand-outs - for a great Christmas pudding filled with many coins - but we should not look at the Budget in this way. The Budget is a fiscal device to keep the economy running on a sound and even keel.

Nobody can complain that this Budget has been dull or uninteresting because it is a Budget brought down to keep Australia running very strongly. In the past year this Government has encouraged a great deal of progress in the country and has been imaginative in the propositions that it has presented to the Australian people. In the past twelve months the Government has committed itself to an expenditure of £110 million on new ideas designed to improve the welfare of Australians. That is a large sum to spend on new proposals. The Government set aside more than £3,700,000 for standardisation of the railway from Broken Hill to Port Pirie. Large amounts of money were earmarked for the work on the Blowering Dam and for developmental projects in the north of Western Australia. Last year pensions for single pensioners were increased by 10s. Repatriation benefits were increased. The Government introduced a bounty on superphosphate. This will cost the Government more than £11 million this year. Before bringing down the Budget the Government increased defence expenditure by more than £24 million. At a cost of almost £10 million this year the Government introduced a scheme of grants for technical and science teaching. All this additional expenditure was undertaken in the course of a year. The Government did not wait until Budget time to try to bring down a popular Budget. The proposals that 1 have referred to were introduced because the Government felt they were necessary for the economy. At a cost of £10 million a year the Government introduced the homes savings grant scheme. Last year child endowment was increased. Last year the Government increased Commonwealth medical benefits, which cost an extra £44 million a year. Last year the Government introduced a scholarships scheme for secondary school pupils in the terms of which each year 10,000 children will receive scholarships for their final two years of secondary schooling. This is advanced thinking; this is progressive thinking - all put into effect in the last twelve months. This year the Government will spend £4,600,000 on wool promotion.

Mr Peters:

– Who wrote that?


– These are plain facts, which I know the honorable member for Scullin will not like. In the last year the Government introduced legislation to provide bounties on the production of sulphate of ammonia and on vinyl resin. It has undertaken, at a cost of £3 million this year, to equalise petrol prices throughout the country. That amount is set aside in this Budget, which is a fair indication that the petrol price equalisation scheme will be introduced this year. The Government has made additional payments to the States for underground water research. The Budget provides an increase of 5s. for various categories of pensions. Repatriation pensioners - the totally and permanently incapacitated pensioner and the general rate pensioner - are to receive increases. All these things will cost the Government £110 million a year. Do not let anybody accuse the Government of stagnating for want of progressive ideas. I have just indicated how (his nation is moving forward within the scope of its economic possibilities.

One of the principal factors contributing to the strong buoyancy of the economy this year is the high farm income which has increased in the last two years by £300 million. The principal increase was due to increased returns for wool, meat, wheat and sugar. Although production has increased substantially, thanks partly to the many forms of assistance given by this Government, too much reliance cannot be placed on high farm income when fixing budgetary proposals because farm income is a very variable factor and may decrease. If this happened the Government would still be faced with recurring expenditure. Farm income is influenced dramatically by seasonal conditions and by world commodity prices.

Mr Birrell:

– Who wrote this?


– A good author. In the past two years prices of wool, wheat and sugar have been satisfactory, but extremely high in the case of sugar. We have had bountiful seasons. If the Government were to calculate its expenditure on the present rate of farm income it may find itself in difficult circumstances should seasons deteriorate or commodity prices decrease. To suggest that seasons will be as good in the future as they have been in recent years is wishful thinking. We hope that commodity prices will remain at their present high level, although the price for sugar has declined considerably in the past six months. Today the price is only £39 a ton, whereas six months ago it was more than £100 a ton. The prosperity of the rural section of the Australian economy has and will continue to have a very big influence on budgetary decisions. Not only do gross earnings affect the economy but export earnings also play a vital role. Without a sustained high rate of farm income many city industries and the people employed in them would be critically affected. Much of our present prosperity is due to the high rate of farm income. A diminution of export earnings would mean some curtailment of imports of the ingredients necessary to keep factories and services operating and employment at a high level.

As I have stressed, the primary producer plays a paramount role in the economy of this country. Stability of costs and prices is of the utmost importance to the primary producer. I repeat: The primary producer is vitally concerned about stability of costs and prices. Primary producers are largely dependent upon world prices. These people can meet competition from other countries only if our cost structure is in line with those of other countries. Nothing will ring the death knell of these great export income earning industries quicker than the infliction of inflationary costs and prices. Every £1 of export income earned by our primary producers reflects its benefit many times throughout every section of the Australian community. Those producers must be protected against inflation.

Many industrialists, members of the Labour Party and speculators in commerce like to flirt with the idea that a little inflation is good. But those people are thinking along a very narrow groove purely for their own personal benefit, and obviously are not aware of how inflation can affect the export producers.

Mr Cope:

– Tell us about the promise to put value back into the £1.


– Things such as that will be dealt with in due course. All I can say is that I would hate to think what the value of the £1 would be today if Labour had been in office with its inflationary policies.

In relation to the Budget, I say that it is very imprudent to build into the economy too quickly the prosperity that the country receives from farm incomes because, as I mentioned earlier, primary industry prosperity often may be only temporary and may vary rapidly according to world prices and seasonal conditions. I shall quote two examples of people being a little too anxious to raise prices when our primary commodities tend to command high prices. In 1952 a wool prosperity loading of £1 a week was placed on the whole economy. I do not think anybody would have complained about that if wool prices had remained at the same level. But they declined; they declined very substantially.

Mr James:

– After the Korean war.


– The prosperity loading was given because of high wool prices, my friend. That loading was incorporated into the whole cost structure of Australia, and when the price of wool went down the primary producers and other people in the exporting field were left loaded with that cost. That placed a very substantial economic strain on the wool industry and all other exporting industries.

Another example of people getting a little too enthusiastic occurred last year in the sugar industry. That industry went through a short period of extremely high prices, as I mentioned a few minutes ago. As a result of those high prices there was a demand for a prosperity loading. A £2 a week prosperity loading was given to all people working in the industry. That is a good thing if those high prices are maintained. But the world price of sugar has come back. Now the industry is inflicted with the higher cost structure although the price of sugar has come back. I do not mind the workers receiving a share of additional prosperity, provided the position is readjusted when the price received by the producer goes down.

The Government looked into the matter of high farm income, but it felt that it could not provide for additional expenditure purely on the basis of increased farm income at a time of high world commodity prices and bountiful seasons. The principle underlying the Government’s policy is that of prudence to maintain stability, yet always keeping in mind the continued pattern of growth which is absolutely essential for the nation, its future development, its future security and its future social wellbeing. Any policy which would inflict inflation on the primary producers could not be interpreted as a sound policy of growth.

Whenever the Government is trying to adopt a fiscal policy which is of a prudent nature and which endeavours to restrain tendencies towards boom, our friends in the Opposition, the speculators and all the people who are looking for a quick quid criticise the Government for introducing a policy of deflation. Let me say right here and now that this Government is against any policy of deflation. Deflation is politically untenable and economically undesirable, particularly because of the employment and business failures that it brings with it.

Mr Uren:

– What happened in 1960?


– Neither do we want inflation. Sometimes, if you are running into a boom you have to modify the boom. Nobody can say that the Government’s measures of 1960 were harmful to the country, because today we have restored our economy to a state healthier than it has ever been before. The Prime Minister (Sir Robert Menzies) illustrated this clearly in his speech last night. The growth of this nation since 1960 has been substantial.

In the course of history there has been much to learn from countries which have been affected by deflation. Sometimes deflation is brought about wittingly; sometimes it is brought about unwittingly. But whenever it happens, it is most unpleasant medicine. Australia will never have to take such medicine under the wise administration of this Government. In recent years countries - for instance, France in 1 958 and Spain in 1959 - have had to adopt policies of deflation in order to start rebuilding their economies on a sound foundation. These policies are most distasteful and can be avoided only if inflation is watched very carefully and combated whenever necessary. That is exactly what we are trying to do in this Budget.

Unfortunately, in the present world it is all too easy to institute inflation. A few edicts of a government pandering to popularity by adopting policies of extravagant expenditure or a government’s failure to accept responsibility for balancing expenditure with receipts can easily cause inflationary trends. Wage fixing bodies bowing to pressure for higher wages and greater working concessions without closely linking them to increased productivity can have a similar escalating effect on costs and prices.

I quoted those few examples to show how easy it is to run into inflation if a government does not at all times keep an eagle eye on the economic indicators which are available. There is no set law which can be applied to avoid inflation or deflation. Every mechanism available to the Government must be used judiciously as the occasion demands - if necessary, from day to day. A little restraint can be applied here, or a little restraint can be applied there; but there is no one set law that this Government, or any other government in the world for that matter, can bring down. In this Budget there are many indicators which show that the economy is pepping up. But unless those indicators are watched closely, they could produce most undesirable trends similar to those that occurred in 1960.

Some of my honorable friends in the Opposition take exception to what is called a surplus Budget. I often wonder why they object to the Government accumulating a surplus in prosperous times like the present. Surely that is what they are doing in their own private affairs. Everybody knows that we cannot go on a financial spree and never pay up. Anybody who has any sense knows that a man should pay his way in good times and also accumulate resources which will carry him through when times are not so good. The management of a nation is similar to the management of our own personal affairs. If we owe debts, sooner or later we will have to pay up.

One of the proudest boasts of Australia is that in the past 10 years or so governments have spent £5,200 million on new assets on capital account - that is, on public works and things that normally might have been provided entirely from loan money. Yet in that time our net total public borrowings have increased by only £1,300 million. That includes the figures for all governments and public authorities in Australia. By sinking fund repayments and by financing many public works from revenue we have created, in effect, nearly £4,000 million worth of debt-free productive assets in the short period of 10 years. This has given the nation enormous reserves of strength which can be drawn on in lean years or in times of defence crisis.

These have been and still are happily years for surplus budgeting. We are accumulating strength for the national good and to build up future production. We can still save and grow into a wealthy nation so that when evil days come - and they are apt to come to nations and to individuals - we will be able to offset the surplus Budgets against deficit Budgets without falling back into the bog of dead weight debt that we had 30 years ago. Just as there is great merit in surplus budgeting in good times so too is there great merit in deficit budgeting during lean times. Let us, therefore, keep in reserve the useful expedient of deficit finance for use in bad times and let us have surplus Budgets in good times. That is a compensating policy that helps to check booms and to cure depressions. This is one of the fiscal means of levelling out the economic peaks and gullies and so producing a land with a stable, fertile and flourishing economy.

When I hear my friends opposite jeering at savings and preaching extravagance, I wonder whether they believe that it is possible to borrow always and never to pay back. They are like the spendthrift Treasurer in the depression of the 1930’s who acted in terms of the old jingle: Just put another £1 in front and add another 0 and we will pay you what you lend us with the money that we owe. It is the proud record of Australia that in a little over 10 years it has avoided inflationary borrowing by surplus budgeting and has repaid to its creditors immense sums through the National Debt Sinking Fund. The Government’s credit worthiness is at an all-time high both at home and abroad. We have never before enjoyed such tremendous confidence from overseas investors. People with savings want to invest in the future of Australia. They do not want to invest just to make a quick £1 and get out, but they are here to participate in our potential and our future development.

A study of the balance sheets of most foreign companies which invest in Australia will show that only relatively small percentages of profits have been repatriated. These companies prefer to re-invest in our nation which has abounding potential, a record of sound economic management and stable government. I wonder whether a Labour government would hold their confidence to re-invest. Or perhaps Labour would not want them to re-invest. In its blind, ignorant way, Labour seems to think that national growth can be measured only by Government projects and in this connection I will in a moment quote from the speech made by the honorable member for Yarra (Dr. J. F. Cairns). This approach is, of course, wrong. By far the greatest productivity has come from public and private companies, from the farmer, from the small businessman, and from the selfemployed person such as the corner grocer. We know that in New South Wales the Labour Government is trying to kill these people. Labour tries to create the image that it wants to help the small man; but this is a false image. It is the people in private business who make a country dynamic. It is not the Government enterprises but the private enterprises that really make a country develop. These are the people who supply the wealth that is taxed by the Government, thus supplying the revenue needed by a developing country. In the speech he delivered last week, the honorable member for Yarra insinuated that since the commencement of the Snowy Mountains Hydro-Electric Scheme no other worthwhile national project had been undertaken in Australia.

Mr Barnard:

– Nor has there.


– Many projects have been undertaken but we do not concentrate all our resources in one prestige project. We spread them round Australia in beef roads, ports, the standardisation of railways, assistance to State Governments for flood mitigation, the construction of dams, the search for oil and a hundred and one other projects. This is the action that is making the country develop. The honorable member for Yarra said -

It would not be a mistake to enlarge the present volume of works. Even, if there were no other way - and there is another way - it would be better to go ahead and risk inflation of 4 per cent, or 5 per cent, a year than to cut back the economy in the present circumstances.

In a time of boom, the honorable member for Yarra, the proxy Deputy Leader of the Opposition, says that we should have inflation of 4 per cent, or 5 per cent, a year. What does this mean? It means that a person who has his money invested in a savings bank will lose 1 per cent, a year. The person who has his money invested in bonds will gain nothing. The person who has saved money for years but has not invested it to earn interest will lose at the rate of 5 per cent, a year. The pensioners would have to be compensated at the rate of 5 per cent, a year. People who engage in export industries would have their incomes decline at the rate of 4 per cent, to 5 per cent, a year. Is this the policy of the Opposition? If it is, and if it is ever put into practice, it will certainly lead the nation to ruin.

I would like to quote a passage from Lenin’s writings about inflation. It is a favorite of mine. He said -

There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction and does it in a manner which no one man in a million is able to diagnose.

Mr Failes:

– Who said that?


– Lenin. This is what many people with rather extreme ideas are trying to do to wreck the economy of this country. Most people with leftish or Communist views realise that Communism can never take the world by force because the weapons at the disposal of the free world are so devastating that we can inflict as much pain on them as they can inflict on us. Today, Communist policy is being moulded to try to wreck our economy by hoodwinking decent, sane businessmen and others into believing that a little bit of inflation is good. But a little bit of inflation leads to a little more inflation and eventually the economy gets completely out of control. We do not intend to allow this situation to arise.

Our record of protecting the value of the £1 in this country is good. Opposition members are laughing. Allow me to quote from one of the most authentic and authoritative journals in the world. It is the “ Monthly Economic Letter “ of the First National City Bank of New York. This bank keeps an index of the currencies of various counttries and of their rates of depreciation. In 1960, before the introduction of our economic measures, the journal showed that our currency had been depreciating in the ten years from 1948 to 1958 at the rate of 6.9 per cent, per annum. This could not be accepted as very honorable. This rate of depreciation was caused by two factors. One was that this Government had been compelled to accept the legacy left by the Australian Labour Party which, during its years in office, had adopted many artificial controls to try to suppress prices and costs. The other arose from the rise in wool prices in 1952. The latest issue of the journal, which is for July 1964, shows that in the 10 years from 1953 to 1963 the annual rate of depreciation of Australia’s currency was 2.2 per cent. This is as good as the result achieved by any highly developed industrialised country. I predict that, if we sustain our present stability, we will have one of the least depreciated currencies in the world. I have pleasure in supporting this Budget and in severely criticising the Opposition for moving the amendment.


.- Mr. Deputy Speaker, may I congratulate the honorable member for Richmond (Mr. Anthony) on being elevated to the Ministry. I could not congratulate him on his speech. I can well recall that when he was a supporter of the Government sitting on one of the back benches and not a member of the Government he made hard hitting speeches and was particularly critical of the Government on its economic policy. It is interesting to note how much he wants to apologise for the Government now that he is a Minister. He criticised the honorable member for Yarra (Dr. J. F. Cairns) for saying that it might be necessary under certain circumstances to have a 4 per cent, inflation cost spiral. The honorable member for Yarra is in particularly good company when he makes that point. He is in the company of Sir Douglas Copland who used to be an economic adviser of this Government. But the Minister supports this Government which has increased prices since it has been in power by 110 per cent. If you divide that figure by the 14 years this Government has been in office, that gives you an increase of approximately 8 per cent, a year. The honorable member for Yarra only spoke about an increase of 4 per cent, a year. Yet, under this Government, there has been an average increase of 8 per cent, during the last 14 years.

There is only one other criticism I desire to make in answer to the Minister. He accused the honorable member for Oxley (Mr. Hayden) of being a breeder of class hatred. May I say to the Minister that the Labour Party does not believe in class hatred. Our party believes in a classless society. We believe in toleration and not hatred. If there is one thing which upsets Government members it is the fact that we want to distribute the wealth of this country so that the poor as well as the wealthy can share in Australia’s prosperity.

I support the amendment moved by the Leader of the Opposition (Mr. Calwell) to the motion that the Bill be now read a second time. I believe that it would be a proper comparison in this debate to imagine the Leader of the Opposition to be in the position of Robin Hood leading his band of men, whilst the Treasurer (Mr. Harold Holt) is in the position of the Sheriff of Nottingham. As the sheriff, he is representing power and privilege and squeezing taxes out of the peasants of Sherwood Forest while the great barons are allowed to evade their responsibilities. One could also imagine the

Prime Minister (Sir RobertMenzies) playing the role of Prince John. The great boast of the Treasurer (Mr. Harold Holt) in this negative Budget is that the defence services expenditure is up by £99 million, or is 50 per cent. greater than the actual expenditure in 1960-61.I do not think there is any need for me to comment on that statement. However, I refer honorable members to the analytical remarks on thedefence expenditure of the Government by my colleague, the honorable member for Melbourne Ports (Mr. Crean) a few nights ago. The question could be asked: Where is the increased expenditure in the Budget on national development and education? I direct attention to the miserable £2 million increase for the Papua and New Guinea Administration. One would think that this was not a part of our defence responsibility. Need I mention my contempt for the Government because of its disgraceful treatment of age and invalid pensioners in giving8½. a day to them. What a poor miserable amount8½d. a day is. That is all the increase this Government can afford to give to age and invalid pensioners.

I want to make some comments to prove that this Government is a narrow, short sighted sectional Government. I will prove how this Government has continually moved the burden of taxation onto the shoulders of those who can least afford to carry such a heavy load - the great mass of our workers. It is interesting to know that there are 4.4 million taxpayers in this country. Eighty-two per cent. of all taxpayers - or 3.6 million persons - earn £29 15s. a week or less a week. This wide section of our community includes the family group that has the hard struggle under this Government not only of educating their children but also of trying to build a home. Those who are able to build a home have to pay exorbitant interest rates. Child endowment has been practically frozen since 1951. Health services and hospitalisation fare worse than any other section of our community. I will give figures later to prove how bad this Government has been in regard to this most important social problem. We need better health services and better hospitalisation. With the concurrence of honorable members I incorporate in “ Hansard “ a table of Commonwealth taxation covering the years 1951-52 to 1962-63.

I intend to prove bow this Government has reduced direct or non-transferable taxes while increasing indirect or transferable taxes on the great mass of workers. If honorable members examine the figures in this table, they will note that in 1951-52 the total revenue from Customs was £114 million, which was 12.2 per cent, of total tax revenue at that time. In 1963-64, collections had risen to £116 million, or 7.3 per cent, of the total tax revenue. It is true that there is a reduction of 4.9 per cent, but this means in fact that Australian industries have less protection from tariff barriers at this stage than they had in 1951-52.

I direct the attention of honorable members next to the figures for excise collections. This tax is a great slug on the worker. It applies to spirits, liquor, tobacco and cigarettes. I am talking of the 82 per cent, of our taxpaying workers who are the great consumers of liquor and cigarettes, even though they do not possess the great wealth in this country. In 1951-52 the receipts from excise amounted to £100 million or 10.7 per cent, of the total tax revenue. In 1963-64, the receipts had risen to £291 million, an increase of £191 million, or 18.2 per cent, of the total tax revenue- This is an increase of 7.5 per cent, on the excise tax which, as I said, applies to tobacco, cigarettes and liquor.

But the Government has introduced further taxation in the current Budget, in the way of excise duty, to get more and mow revenue from the workers. If honorable members observe the figures for sales tax, they will note that in the period 1951-52 to 1963-64 there has been no change in the percentage of sales tax receipts in relation to total taxation revenue. But, if honorable members refer to the last year of the Chifley Administration, they will note that in 1948-49 only £39 million was raised by sales tax. This represented 8.2 per cent, of total taxation revenue. In the year 1963-64 this figure has risen to 10.1 per cent, which is an increase of nearly 2 per cent.; but the revenue raised was £162 million This represents a fourfold increase - from £39 million in 1948-49 to £162 million in 1963-64. This is an indirect tax, a burden on the mass consumers, who are represented by that 82 per cent, of all taxpayers who earn less than £29 15s. a week. There has been no change in the rate of payroll tax. It has remained at 4 per cent, from 1951-52 until the present time. I come now to individual income tax. This is an equitable tax, a tax which we in the Labour Party support. We believe that if any tax should be increased it is the income tax, especially on higher incomes. In 1951-52, the revenue derived from this source was £386 million, or 42 per cent, of the total Commonwealth revenue. In 1963-64, it was £636 million, or 39.8 per cent, of total revenue. This represents a decrease in the proportion of total revenue represented by income tax of 2.2 per cent. This equitable tax, the tax which should have been increased, has been decreased.

The next matter that I wish to discuss is company taxation. This Government calls company tax a direct tax. I call it a transferable tax. It is a type of indirect tax because it is transferable. It is to be increased by 6d. in the £1, but that increase will be passed on to the consumer. The great monopolies of this country - I shall give percentages with relation to monopolies shortly - will add this increase to their cost structure and pass it on to the consumer. The revenue derived from company tax has increased from £150 million or 16 per cent, of total taxation revenue in 1951-52 to £293 million or 18.3 per cent, of total revenue in 1963-64. This is an increase of 2.3 per cent, over that period. A simple examination of the figures shows how the Government has held on to transferable or indirect taxes and has kept down or minimised direct taxes.

The Government has now moved into another field. It has now decided to use the Postal Department as a taxing instrument. Surely the Minister for the Interior (Mr. Anthony), who is at the table, will remember that at the Lismore by-election several years ago a Labour candidate was returned to the State Parliament for the first time because the electors were dissatisfied over an increase in postal charges. In 1951-52, the revenue of the Post Office amounted to £59 million, or 5.8 per cent. of total Commonwealth revenue. By 1963-64, it had increased to £165 million, or 8.6 per cent. of total Commonwealth revenue. This represents an increase of 2.8 per cent. Until about 1958- 59, the Post Office was just a paying concern. It was rendering a service to the community. In 1958-59, this Government decided to use the Post Office as a revenue raising instrument, with the result that in that year it had a surplus of £5 million. In 1959- 60, it had a surplus of £11 million; in 1960-61, of £23 million; and in 1961-62, of £22 million. By this time, the men of the Treasury had a guilty conscience. Up to that time, they had been publishing in a White Paper all relevant figures with relation to Post Office income and expenditure. Now the details are hidden. I shall quote some figures from the present Budget Papers. I cannot say that they show the actual Post Office surplus, because one would have to do a great deal of research to be able to say that, but one can say that there is a surplus. It is estimated by the Government that the revenue of the Post Office for 1963-64 was £165 million and the expenditure was only £115 million. This seems to be to indicate a surplus of £50 million. We know that postal charges have been increased since then, and we do not know what the surplus will be next year. It has been the Government’s policy to burden the mass of consumers in the community more and more with greater indirect taxes such as postal charges, telephone charges, sales tax and excise duties. It is the workers - the 82 per cent. - who consume the great bulk of the goods in this community and who are the greatest users of services, but we know that they do not control the bulk of the wealth in the country.

I direct my attention now to the statement made by the Treasurer on page 9 of his Budget Speech, where he makes reference to company profits. In that statement, he said -

We recall that, over recent years, companies have had a major share in the benefit of a very wide range of concessions which are still in force.

Just imagine! The Treasurer admits that the major companies, the big companies, the monopolies have had some concessions. Wait till I tell you what those concessions are. He went on to say -

Among these have been such important measures as the investment allowance for plant used in manufacturing.

I will deal with that a little later. I want to deal first with undistributed profits. The Treasurer did not mention them. Since 1951, undistributed profits amounting to £2,698 million have been retained by the major companies in Australia. It is difficult to say what has been ploughed back into industry and what has been used to bolster up reserves in order to allow companies to issue bonus shares - which, I might add, they do in order to avoid taxation. As a matter of fact, a few years ago I took out some figures relating to capital gains by Myer Emporium. I found that from 1st January 1954 to 1st January 1960 the share holdings of the Myer family appreciated by £22 million; in other words, the Myer family enjoyed a capital gain of £22 million. They bought out Farmers Ltd. of Sydney for £22 million. I also took out figures at that time relating to the capital gains of the Baillieu family and the Darling family, with their holdings in the Broken Hill Pty. Co. Ltd.

Until 1951, there was an undistributed profits tax of 2s. in the £1. Had this tax not been abolished, the amount that would have been paid by the various companies in Australia on the £2,698 million that they retained would have been £269 million. In effect, this means that the Government has made a gift to these great monopolies of £269 million. If this Government had retained the 2s. in the £1 undistributed profits tax which was introduced by the Chifley Administration, that £269 million would have gone to swell the Commonwealth revenue. Instead of abolishing the tax, the Government should have retained it and indeed increased the rate. With the concurrence of honorable members, I incorporate in “ Hansard “ the following table relating to the components of the gross national product from 1948-1949 to 1963- 1964-

I point out to honorable members that the table which I have just incorporated in “Hansard” includes figures relating to the allowance for depreciation, a matter that was mentioned by the Treasurer in his Budget Speech. It will be noted that in the last year of the Chifley Government’s administration the allowance for depreciation amounted to £96 million, or 4.2 per cent, of the gross national product. By 1963-64, that figure had jumped to £664 million, or 7.6 per cent, of the gross national product. This represents an increase of 3.4 per cent, in the proportion of gross national product represented by an allowance for depreciation. Imagine that! Over this period, large companies have been able to write off for depreciation a total sum of £5,834 million. Let me give more up to date figures. Over the last five years, some £3,000 million has been granted as an allowance to the major monopolies. These major monopolies use these two major items - the allowance for depreciation and the undistributed profits - to provide for future development. They develop Australia with our money. Many of them are foreign owned companies which do not bring money into Australia but use these means to provide for their future development, to enable them to own more and more of our country’s heritage. This has been to the detriment, to a great extent, of the community in four respects.

First, it has been to the detriment of housing. My colleague, the honorable mem ber for Yarra (Dr. J. F. Cairns), dealt with this matter and spoke of the great social problem of housing. In Australia we have more than 100.000 families without homes. There is a very gloomy picture for those people. The honorable member for Yarra, during the Budget debate, showed by means of the general price index that the cost of housing in Australia between March 1960 and March 1964 rose by 18.6 per cent., and that over the same period weekly wages rose by only 5.7 per cent. Secondly, a dan.derous situation exists in relation to health about which I spoke earlier. If honorable members consider the expenditure on health during the last year of the Chifley administration they will find that it reached £24 million, which represented 1.1 per cent, of the gross national product. In 1963-64 the expenditure on health had risen to only 1.3 per cent, of the gross national product. In a country that is prospering we know that such a small increase is criminal. Every honorable member on this side of the chamber, and every honorable member opposite also, knows that it is criminal when it is necessary to place old people who are sick in homes. They have to enter hospitals where they are charged £1 6 or £20 a week. Those old people are breaking their hearts wondering how they can pay. Other people in the community, concerned about their mothers and fathers, are worried about this situation. Thirdly, honorable members should consider the great crisis that we face in education. Time does not permit me to develop the details. Fourthly, we have crisis with social services. I have referred already to child endowment and the shocking treatment by the Government of invalid and age pensioners.

In the few minutes remaining at my disposal I propose to deal with the growth of monopolies in Australia. Their extent in Australia is greater than in any other capitalist country. Their extent in Australia is twice as great as in the United Kingdom and three times as great as in the United States of America. Control of our industry and commerce is going into fewer and fewer hands. An examination of the forty-second report of the Commissioner of Taxation discloses the extent of control of companies by monopolies as at 30th June 1961. I ask the patron of small businessmen, the Minister for the Interior (Mr. Anthony), who is now at the table, to pay attention to this. At the time the report was issued there were 54,000 taxable companies in Australia, including both resident and non-resident companies. Of that number 52,224 - 95.78 per cent. - made only 29.13 per cent, of the profit earned by all companies. On the other hand, 2,302 companies - 4.22 per cent. - earned more than 70.87 per cent, of the total profits earned by all companies. Further, 1,195 companies - 2.19 per cent, accumulated 62.43 per cent, of the total profits earned by all companies. If honorable members break down the figures still further they will find that 547 companies - 1 per dent, of all companies - earned between them 53.48 per cent of all company profits.

Then if honorable members want to talk about the top 102 companies which were referred to by that economist of great repute, E. L. Wheelwright, we find that 102 companies earned more than £1 million profit in a year. That is, .19 per cent, of all companies earned 33i per cent, of all company profits earned in Australia. It is easy to imagine the extent of the monopolies that are growing in Australia. Surely any honorable member opposite who has any Australianism will be against the growth of monopolies. If honorable members opposite are not against the growth of monopolies, let them stand up and be counted.

The figures that I have cited indicated that 1 per cent, of companies produce more than 50 per cent, of all Australian products and control and employ more than 50 per cent, of Australia’s manpower. These figures were applicable only to 30th June 1961. From 1961 to 1963 there were 95 takeovers involving assets of almost £200 million, and in addition there were huge mergers during this period. It must be kept in mind that foreign capital, particularly from the U.S.A. and Great Britain, has played a prominent and aggressive part in these take-overs. This trend of monopoly continues whether the economy is booming or whether it is in a state of recession.

In a boom period the number of takeovers and mergers increases. In a period of recession, many enterprises collapse and even some of the larger companies are liquidated. From all this the monopolies gain. They are a power unto themselves. The increase of 6d. in the £1 in company tax will be passed on to the consumers and to it will be added a further profit. There has been an increase of 3d. a packet in taxation on cigarettes, but the tobacco companies decided that they should increase the price by 4d. a packet. In the financial year ended June 1963 the two major tobacco companies made the following profits: British Tobacco Co. (Aust.) Ltd. made a net profit of £2,494,967; Rothmans of Pall Mall (Aust.) Ltd. made a net profit of £1,485,384. These companies between them made a net profit of £4 million in 1962-63. When the Government increased the tax on cigarettes by 3d. a packet the tobacco companies, being faced with increased company taxation, decided to pass on the cost burden and consequently increased cigarette prices by 4d. a packet.

It is interesting to note the views of Dr. H. C. Coombs, Governor of the Reserve Bank of Australia, expressed in an address in Perth in 1959. He said-

An important element in the pricing policy of industrialists and traders is their belief that selling prices should be sufficient to provide riot merely cover for costs of production, including a reasonable return on capital, but also a substantial part of the additional capital required for expansion. Undistributed profits after the payment of dividends at normal rates provides a very substantial part of the development funds of Australian companies.

Did I not say that earlier? Dr. Coombs continues -

Also prices designed to provide such surpluses represent a kind of unofficial indirect lax imposed on consumers for the benefit of the industrialists and traders concerned. . . . lt is possible for prices to be managed in this way partly because of the widespread semimonopolistic elements in contemporary productive and distributive organisation and because general demand has been maintained for a number of years al high levels. . . .

It is interesting to note that this speech was made by Dr. Coombs in 1959, but even with the 1961-62 recession, prices did not go down. They went up. At that time, staff were discarded. For example, the workers in General Motors-Holden’s Pty. Ltd. were dropped by several thousand. But this is the usual policy. The growth of monopoly is one of the greatest threats to this country. It places pressures on the community and exploits the small businessmen and the small farmers. The Minister at the table should know that. Monopoly uses the great wealth at its disposal to deny workers justice and a fair economic return for their labour.

As the monopolies increase in strength, so their arrogance develops. They adopt a provocative attitude towards trade unions seeking to restrict union organisation in industry and using the penal provisions of the legislation against the unions when the workers fight against their restrictive policies. People must be warned against accepting the proposition that legislation aimed at restrictive trade practices can affect monopolies at all. Monopolies can get their way without any restrictive practices. All they need to do is control their prices or their output. Price control is necessary. No-one can by sure what form it will take, but we can be sure that it will come. It must come if the workers, the consumers and the nation arc to be protected against the exercise of these concentrated powers to which I have referred.

I support the amendment proposed by the Leader of the Opposition (Mr. Calwell), Mr. Acting Deputy Speaker, and I believe the Government should be condemned for producing this negative Budget.

Hon. W. C. Haworth

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


.- I would like, first, to take up one of the challenges issued by the honorable member for Reid (Mr. Uren). He asked those who are not opposed to monopolies to stand up and be counted. Well, 1 am standing up to be counted. I have been accused of many things in my time, but the day is yet lo come when I can be accused of being subservient to industry. I am prepared to have my attitude spelled out clearly because I have demonstrated in this House that I will always fight for a fair crack of the whip when the occasion arises. I do not think monopolies are bad. I think there are many occasions in an economy as small as ours when they are essential. I am against the misuse, of monopoly power and 1 hope that when the promised legislation does come forward this will be one of the matters dealt with. But do not let us have any misunderstanding about these monopolies. In a small economy like ours they are not necessarily bad.

The rest of the speech of the honorable member for Reid seemed to hang rather vaguely on the question of direct and indirect taxation. He said that indirect taxation bears more heavily on the little man. lt does indeed, and this is one of the things that always concern Treasurers. But I would remind the honorable member of figures given by the honorable member for Higinbotham (Mr. Chipp) last week. In 1949, the year of the last Chifley Budget, indirect taxation accounted for 44 per cent, of all taxation, while in 1963-64 the proportion was 39 per cent. This is the kind of fact that must make the honorable member for Reid very disappointed, because it bowls his argument right over.

Let me now deal specifically wilh the Budget. We have to admit that it is a Budget of an affluent society. There is argument between us on this side of the House and honorable members opposite about the details of the Budget, but the fact remains that it is a Budget of an affluent society. What we are really arguing about is whether certain people should have a bigger slice of the cake. Our philosophy has always maintained that you must provide incentives for production so that a bigger cake can be produced. The Opposition has always maintained that the important thing is to cut the cake up into equal shares. We are arguing along those lines and I do not expect to be able to convince honorable members opposite. All I want to say is this is the kind of Budget that could be brought forward in an affluent society. We can argue about the details, about who should get the bigger share, but we on this side believe that if you take away the incentive to produce by making taxation too high you will automatically reduce the size of the cake.

There is one other point that I want to make, and which I have made in previous years. It is easy for honorable members in Opposition to say that inflation does not matter. We have often heard the question asked from the other side of the House - “Why budget for a surplus at a time like this?” There is only one real reason, and that is to try to hold inflation in check. It is easy when in Opposition to say that it does not matter, but I remind honorable members of the words of the last Labour Treasurer, Mr. Chifley -

I am deeply grateful for the support that my colleagues have given me in my fight against the great danger of inflation. I know that some of them have not readily seen the force of many of the economic theories on which I have had to act, and that they were apt to regard my ideas as fossilised. But they have stood by me.

These are the facts. If Labour members did have a sense of responsibility and a Labour Government was in office and had to prepare a Budget, the Labour Treasurer would have to do as Mr. Chifley did. He would have to take account of inflation because it does matter. It matters to two particular and important sections of the community; first those on fixed incomes - and they are important numerically and in other ways - and, secondly, it matters tremendously to those who produce for the export market.

These are facts that I should not have to labour, but I must make these points because it is in respect of these matters that the Opposition offers its easy criticisms. Honorable members opposite must realise that if ever they have to bring down a Budget of their own they must, if they are going to do the job for Australia that they should do, have regard to the inflationary problem.

My main reason for rising was to support the honorable member for Higinbotham who made, I thought, a most effective and idealistic speech, dealing with the need for increased international aid. Although this is an easy subject to be eloquent about, it is not so easy to make specific suggestions on the subject. I intend to try to make some suggestions because I think it is an important matter. We have heard many platitudes uttered at various times on both sides of this House such as - “ We are all one world “, “ We are part of Asia “, “ Trade is more important than aid “. These are the kinds of platitudes that we are continually hearing. What is the problem? Should we be setting aside more money in our Budget for international aid? I repeat: What is the problem? It falls into two parts. The first concerns the widening gap between our standard of living and the standards prevailing in most of the Asian countries. We are getting richer and they are just about standing still. I have just come back from a most interesting, tiring and educational trip to India, Pakistan and Ceylon. I have seen, as all the members of our party saw, the problem at first hand. We saw the people lying in the streets. We say the appalling poverty. It is not easy to arouse people’s sympathies about these things, but when you go to these countries and see the conditions, the experience does something to you. I do not think those of us who made the trip will ever forget it.

The other problem, which is tied to the first one, is that of the population explosion. We have heard about this time and time again in this House. We have been told that the world population increases annually by 51 million. This does not mean much to me because I can never get my mind around these big figures. Let me put it another way. Tomorrow morning there will be 140,000 more people in the world than there were this morning. Here again I find it difficult to get some conception of the meaning of the figures. If you go to the Melbourne Cricket Ground to see one of the annual bloodbath games you will be one of about 120,000 people crammed into that arena.

Mr Holten:

– No, 110,000.


– Well, let us not quibble about it. Tomorrow morning there will be 140,000 more people in the world than there were this morning. This is the problem that we face. Is it our problem? Cynics will ask-“ What has it to do with us? We are in Australia and this is happening chiefly in other countries. Why should we worry? “ The difficulties of helping are much more real than most of us recognise.

Fortunately, I have had an opportunity to see some of the difficulties at first hand. I know that this is a subject about which it is easy to make speeches; yet the finding of solutions is desperately difficult. Some people say: Is this our problem? I say it is.

There are many reasons why this is our problem. Three reasons may be advanced immediately. The first reason is that the principles of Christianity should be invoked in matters such as this. Surely we, as a Christian nation, should be interested in this matter. Secondly, even if we had not Christian beliefs, the ordinary Australian considers that, for sweet charity’s sake, something ought to be done about the problem. Some people may say: These are platitudes of the kind that a shining eyed idealist would utter. The third reason why this is our problem is that for the sake of our own survival, above all, we must do something about it.

This, again, is easy to say. Let us get down to tin tacks. It is easy to say that something must be done for the sake of our own survival. I do not believe for a moment that there will be any rush of people to our shores in a sudden invasion. But I do think that we have a problem, just the same. Put another way, that is the problem of the spread of Communism. We all are particularly concerned about what is happening in South Vietnam at present. And we should be. Why are we concerned? It is because we know that, if Communism comes south, our frontier shifts south. We are concerned about that. If Communism approaches closer to our shores, what will happen?

What will happen in India, with its appalling economic problems of the immediate present and the even greater economic problems that it will have in the future? What kind of pressure will be imposed on the Indian people? If they cannot get on top of their economic problems, what will prevent them from falling to the temptation to become Communistic? Surely this is the kind of thing that we all should think about. We know, of course, that there are many good reasons why India should riot become Communistic. But it is difficult for a person who has had nothing good in life for many weeks and who perhaps sleeps on the street, to realise that his position could be even worse under Communism. He thinks it cannot be much worse than it is at present. I firmly believe that the pressure on India to become Communistic if its basic problems of economic development are not solved will be very dangerous indeed. That is one of the reasons why I say that this problem is basic to our survival. India’s population is more than 400 million, and it is rising at the rate of 10 million or more a year. This kind of thing, I suggest, poses tremendous problems relating to our survival. But even if for 100 years there were not pressure on India to become Communistic, there would be built up some kind of pressure that would tend, as has always happened in the past, to close the gap between standards of living where the gap is so wide as at present.

I want to sum up by saying that we all are proud of Australia’s position in the world and its standard of living. We are proud to be on top of the world, and we have every reason to be. All I can say, however, is that the top of the world can be an awfully dangerous and uncomfortable place to be sitting if an explosion of the kind that I have described occurs. What can bc done about the situation? It is of no use just to pose these problems without considering what we ourselves can do. What can be done? First, I come back to what may be described as one of the original platitudes: Trade is more important than aid. We know that in India and Pakistan particularly the great need is for foreign exchange. They want to import tools and machines for their factories, but they have not the foreign exchange with which to buy what they require. Imports can be paid for only by exports. That is the situation there as it is in Australia. So those countries need foreign exchange. Therefore, trade is more important than aid.

We all know this. We all say it. The trouble is that, when countries such as this begin to do exactly what everybody tells them to do and when they start, for instance, to sell us the things they are good at producing, we walk by on the other side of the road, as it were. When they begin to sell us textiles, we impose a tariff on those textiles and prevent the producing countries from doing what they can do well. The parliamentary party that I have mentioned visited textile mills in Pakistan and India and saw something of a field of production in which those countries have natural advantages. This is a labour intensive industry. Those countries have cheap cotton and cheap labour. However, when they begin to do just what everybody says they ought to do, and when they begin to sell us their cotton textiles, we say: “No. This is not for us “. We make speeches about what ought to be done, but when it comes to helping, our actions do not suit our words.

I was disappointed today in the remarks made by the honorable member for Port Adelaide (Mr. Birrell). He did not take what I would describe as a typical South Australian attitude when he criticised the honorable member for Higinbotham, who had posed the problem that I have been discussing. The honorable member for Higinbotham was not threatening Australian labour standards or anything of the kind. He was posing the problem that I have just been discussing, and I pose it again.

There is one other thing that we can do about trade. This ought to be recognised. It was mentioned only the other day by the Minister for Trade and Industry (Mr. McEwen) in answer to questions. I feel very strongly that the present arrangements under the General Agreement on Tariffs and Trade are slanted in favour of the very progressive or very advanced industrial nations. These arrangements were introduced in 1946 or 1947 to help the European countries that had been desolated by the war. That was a time when the helping of those countries was one of the greatest problems that the world faced. I would not go quite as far as the Minister for Trade and Industry did and call Australia an undeveloped country. I think that is stretching matters a little too far. I think that what he meant was not fully developed. We ought to be careful not to shelter too much behind the G.A.T.T. arrangements. I believe that, not for our sake, but for the sake of the developing countries, those arrangements ought to be looked at again.

Let me return now to the matter of aid. Here, I join with the honorable member for Higinbotham in saying that we ourselves are not doing enough in this Budget. How much are we in fact doing? With the concurrence of honorable members, I shall incorporate in “ Hansard “ a statement of Australian expenditure on international aid, including expenditure in Papua and New Guinea, in the four financial years from 1961-62 to 1964-65, inclusive. This statement, which has been prepared by the Statistical Service of the Commonwealth Parliamentary Library, is as follows -

Honorable members will see that in 1963-64 we provided £33,168,570 for international aid. This represents 1.51 per cent, of total Commonwealth expenditure and .38 per cent of the gross national product. It is not anough. Particularly when we realise that this includes expenditure in Papua and New Guinea, we are impelled to ask: Why not more?

This brings me to repeat that the solution of the problems that are posed is not easy. It is of no use just to say that we shall shovel aid into the laps of other people and leave them to use it as best they can. I have seen this sort of thing done, and I know that the giving of aid carelessly is no solution to the problems that exist. One of the great disappointments of the world has been the difference between the results of the Marshall Aid Plan in Europe and the aid now being given elsewhere, particularly in Asia. We all recall the success of Marshall Aid and the way in which it enabled Europe to lift herself by the bootlaces, as it were, and go forward in the way that we all hoped she would progress. We hoped that Asian countries, too, would make similar progress. But the aid given to Asia has not had similar results. Why not? What are the requirements that we should have in mind when we talk glibly about the aid that we ought to give and about increasing the aid that is being given?

What kind of problems have we in mind? First, I think we should give aid only to countries that have the administration to use it. Administration is even more important than is education. Remember that the industrial revolution took place in an England that was largely illiterate. I repeat: Administration is even more important than is education. It is no good giving aid to countries unless they have the administrative machinery to use it What we should do is help them with their administration - help to build up their civil service structure and so on. We are doing this on a small scale at present but we could do more. It is no good trying to salve our conscience by giving aid to countries that cannot use it well.

There is an old biblical saying to the effect that to him that hath shall be given. In this exercise of international aid - this is rather unpleasant but it must be said - I feel very strongly that it is best to concentrate the aid on countries that have a hope of getting off the ground one day and not to try to give everyone equal shares in the aid available. Unfair sharing - if you like to call it that - does not appeal to our sense of justice but the time for that is past. We have to tackle the problem and get some results. If we think we will get results merely by distributing largesse carelessly we are wrong.

The third point is that we should think carefully about the kind of strings that we tie to the aid that we give. I do not say that we should tie political strings to the aid but we should tie pretty close economic strings to it. We should say: “ We will give you this if you do that. We expect the following things to be done “. Therein lies the success of the World Bank. It has insisted on a programme of performance.

Another thing we should be careful about is that we do not become blinded by the importance of the size of aid programmes. We should not measure the importance or success of a project by the number of cubic yards of concrete poured. I have seen too much of this large scale economic assistance. In many cases these plans do not work well because they are too big. Here I make a plea for the organisation which the honorable member for Higinbotham mentioned - the Community Aid Abroad organisation. This is a first class organisation which keeps its administrative expenses down and which spends its money wisely. On my trip I saw a small sewing machine that was sent to a little village which had a small problem. Although the people in the village could make shoes they had to travel seven miles to get the sewing done. I do not pretend that the provision of a sewing machine is solving India’s problems but it is a start at the only place where a start will do any good - at the grass roots. This is the kind of thing upon which we should concentrate - the simple things, the grass roots. Another aspect which we should keep in mind is that we do not insist on giving aid only to democratic countries’. Let us be clear eyed about this. In many cases a democratic system does not suit a developing country well.

Mr Cope:

– Well, what is India?


– I will not deal with that now. We must realise that democracy is not, of itself, a good thing although it may be on some occasions. However, it is not necessary and we should not have any inhibitions about not giving aid to a country merely because it has a democratic system of government. Another thing that should be said about aid in general is that we are too quick to hide behind the image of the Colombo Plan. We are too inclined to say that because we have the Colombo Plan and, indeed, had something to do with its origin, our conscience is clear. As far as I can gather - I admit the figures are difficult to obtain - we give about £5 million a year to the Colombo Plan. I think Canada gives about £17 million. Japan, New Zealand, Canada, Great Britain, America and Australia are partners in the Colombo Plan. America Contributes £17 for every £1 that all the other partners together contribute. I am not decrying the Colombo Plan. It is a start in the right direction but it is very little more than a start. I think that Australians for too long have sheltered behind the public image of the Colombo Plan.

The problem that I say has to be faced, and one thing of which we can be certain, is that the road ahead will not be easy. We can comfort ourselves with the thought that nothing worthwhile in the world ever has been easy but I am disturbed at the small amount of interest taken in the subject. I am disturbed about the small amount of money that we have set aside from our affluent society, as evidenced by the Budget, for this purpose. I close with the following quotation from Barbara Ward’s recently published book -

Behind the figures and statistics lie the realities of children without bread, men without work and women without hope. If these do not move us to action the outer form of our society may survive but its inner spirit will have withered away. Then, like the myriad proud civilisations upon which “ the sentence of the watches “ has already gone forth, we shall be carted off this great stage of the world into the dust and debris of history, there to join the melancholy line of past societies which, in the crucial test, could not change and advance in time.

This is the point that I want honorable members to note -

It is our fortune at this moment of crisis to have all the physical resources that are needed to create a new world of opportunity, lt is our tragedy that we may lack the vision and the will.


.- I support the amendment proposed by the Leader of the Opposition (Mr. Calwell) which represents a motion of censure against the Government. Undoubtedly, no government is more deserving of censure than is the present Administration in this country. The Budget Speech of the Treasurer (Mr. Harold Holt) comprises extravagant praise of the state of the economy and the efforts of this Government. I shall quote a few examples of the extravagant phraseology contained in his Budget Speech. He said -

Altogether 1963 was a year of notable economic achievement for Australia.

Externally the results of the year were quite spectacular.

To state very broadly our expectations for this year we think that there can be and will be a further considerable rise in employment, production and general activity, but that for sheer physical reasons this can hardly be expected to equal the rather phenomenal results of 1963-64.

With this background of announcements would you not have expected a stimulating, exciting, progressive, developmental Budget? Would you not have expected something that really gave benefits to the people of this country? But what did we find? We found the same old Tory methods, the same old jargon and the same old deflationary budgeting. After the great praise that the Treasurer gave to the efforts of his Government and to the economy we found that the Budget provided for increased income tax collections of £20 million. We found increased excise on cigarettes and tobacco which meant an increase in the cost of these goods to the consumer. We found increased sales tax on motor vehicles and other items which now totals 25 per cent. We found increased telephone installation fees and rentals and we found increased radio and television licence fees. Air navigation charges have been increased. Every increase is a further imposition on the depleted incomes of wage earners, particularly those in the lower income group, and on the aged, the sick, the infirm and those in receipt of other social service benefits. This Budget, which the Treasurer says will bring stability, places a further impost of £87 million on the Australian people in the coming year and ultimately will show, according to the Treasurer, a surplus of £184 million. Total expenditure under the Budget will be a record £2,51 1,100,000- an increase of £224.4 million over the previous year. The

Budget details expenditure on a variety of items, but I do not propose to refer to all of them in my speech.

I do not have a great deal of respect for the Treasurer as a judge. If he were a racehorse and you were backing him on form you could not support him. Let us have a look at some of his predictions and at things that have happened since he became Treasurer. In 1959-60 his estimates were astray by £32 million. In 1962-63 his estimates were out by £134 million. In 1963-64 he was once again out by £86 million. Between 1959-60 and 1963-64 receipts exceeded Budget estimates by £252 million. The Treasurer has estimated that he will have a surplus this year of £18i million. Your guess as to the final result is as good as mine. The Treasurer could be out by as much as £180 million either way. An error of £100 million does not worry this Treasurer. He would be the worst judge ever to present to this Parliament estimates of receipts and expenditure that he expected the people of Australia to accept.

Let us see what happens to taxes under this Budget. The Budget provides for a flat 5 per cent, increase in taxation on all incomes throughout the length and breadth of Australia. This action departs from every principle of taxation justice. The wealthiest man in the community will find his income tax increased by the same rate as the increase applying to the poorest man in the community. In a splendid speech last week the Leader of the Opposition (Mr. Calwell) stated that in the last ten years the income tax paid by the average wage earner has increased by 179 per cent, compared with an increase of only 105 per cent, in the case of the man earning £5,500 a year.

What is the position with regard to company tax? In his Budget Speech the Treasurer almost apologised to companies for increasing company tax. He said - lt may perhaps be contended that as there has been no reduction of income tax rates on companies during the period when individuals had had the advantage of a 5 per cent, rebate it is inappropriate to increase rates on companies at this juncture. We considered this point. On the other hand, we recalled that, over recent years, companies have had a major share in the benefit of a very wide range of concessions which are still in force. … It fs estimated that, in the current year, companies as a whole would be paying a full £30 million less in taxation because of these concessions.

This year the extra taxation paid by companies will amount to £22 million, so under this Government companies this year still will be £8 million to the good.

What is the position of business and insurance companies in this country today? Tonight the honorable member for Reid (Mr. Uren) cited clear figures to show the tax position of these companies. Why cannot they pay a little more than they are paying? Why apologise to them? Last year Australian Chemical Industries Ltd. made a profit of £2,230,000. The Colonial Sugar Refining Co. Ltd. last year made a profit after taxation of £7,395,839. The Broken Hill Pty. Co. Ltd. struggled along last year with a profit of £18,338,366. Last year the consolidated net profit of all the B.H.P. organisations was £76,435,086. Last year the profits of Imperial Chemical Industries of Australia and New Zealand Ltd. increased by £3,648,548. Last year Mount Isa Mines Ltd. made a profit of £5,597,769. Last year General Motors-Holden’s Pty. Ltd. just managed to stick together with a profit of £19,165,705. These big companies operate unchallenged by this Government, which apologises to them for increasing company tax by a miserable 6d. in the £1. These companies can well afford to pay more in taxes.

As far back as 1949 this Government said that it would introduce an excess profits tax, but it has never given effect to that promise. Big companies in Australia have unlimited funds. Their directors and executives enjoy special concessions. Tobacco companies and other companies have unlimited funds for take-over bids. They have built up huge reserves under the patronage of this Government. Whenever the workers claim a few shilling increase in their wages the big companies send their lawyers into the court to state that they cannot afford a meagre increase in the rates paid to the man who has only his labour to sell. These are the people who should be taxed by this Government. Why increase by 5 per cent, the taxes on a family man when these prosperous and solvent companies go practically unchallenged? The Treasurer and his Government protect big business. This is injustice and discrimination against the working man, whom the Government should protect.

Today, while big business operates unchallenged, the man earning £16 a week and keeping a wife and two children is called upon to pay 12s. a week in income tax. The same man in receipt of £20 a week is called upon to pay £1 3s. 3d. in income tax. In addition he pays £1 a head for all members of his family in indirect taxes - £57 or £58 a head a year. A man in receipt of £16 a week and keeping a wife and four children will pay 6s. 3d. a week in income tax. The same man will pay 15s. 9d. a week tax if he earns £20 a week and will still pay between £4 10s. and £5 a week in indirect taxes.

This is discrimination by the Government against the average person in the community simply to protect the huge interests that could pay increased taxes and so make a contribution to the economic welfare of this country. While the Treasurer takes from the meagre pay envelope of the basic wage earner struggling to maintain a wife and two children 12s. a week in direct taxation and £4 10s. a week or about £232 a year in indirect taxation, huge companies such as the B.H.P. announce annual profits of more than £18 million. Despite this the Treasurer is apologetic for increasing company tax by 6d. in the £1.

Whenever the Government wants to boast about its social services programme it tells the people that in 1949 the Labour Government spent so much, but that this Government this year will spend so much. The Government points with pride to the huge amounts it is to spend in connection with the Budget. Let me compare some taxation figures. Since the Chifley Government went out of office in 1949 revenue from customs and excise charges levied by this Government has increased by £263 million a year. In the same period revenue from sales tax has increased by £120 million a year. Since the Chifley Government was defeated income from indirect taxes of all kinds has increased by £420 million a year. Income from direct taxation has increased by £674 million a year. Indirect taxation has increased from £30 a head of population under the Chifley Government to £57 18s. per head under this Government. Direct taxation has increased from £42 per head of population under the Chifley Government to £87 2s. per head under this Government.

Mr Clyde Cameron:

– Do those figures refer to men, women and children?


– Yes. Since 1949 the total amount of tax paid per head of population has increased from £83 a year to £145. What a monstrous state of affairs under a Government that pretends to represent the average man and woman.

Let us consider some of the other imposts that are placed on every person in the community by this Government. The price of a packet of king size cigarettes has increased by 4d. The Treasurer said that the increase would be 3d., but what is a mistake of 33J per cent, to him? He is accustomed to being millions of pounds out in his calculations, so why should he worry about Id.? Once again the average wage earners and the pensioners will be the ones to suffer most by this increase in the cost of tobacco and cigarettes. If a man is a one packet a day smoker the extra cost will be 2s. 4d. a week If he smokes one and a half packets a day the extra cost will be 3s. 6d. a week or £9 2s. a year. It is the average citizen and the pensioner who is called upon to bear the full burden of this additional charge while big companies will continue to rake in unlimited profits.

This year the Government is taking £12.5 million from the men and women who enjoy a cigarette. This Government does not believe that people ought to smoke. It does not want people to derive enjoyment from smoking and other things. Members of the Government are a lot of narks. They are all getting so old in office that they have forgotten what children look like. Therefore, there are no increases in child endowment. They do not like to see people smoking or having a beer. That is what people in the generation that is growing up do, and the Government is placing these impositions on them. The honorable member for Mallee (Mr. Turnbull) is interjecting. Look at him. He has evidently never had a smoke or drink in his life, and you can see that when you look at him.

One lb. of tobacco makes 420 cigarettes or 21 packets of 20. The new excise duty is 37s. Id. per lb. or ls. 9d. on a packet of 20. That means that today cigarettes cost 3s. 7d. or 3s. 8d. for a packet of 20, and 50 per cent, of that is duty. I tell honorable members that they do not own all of their cigarettes because, under this taxation proposal, the Treasurer owns 50 per cent, of them. Today the price of a bottle of beer carries 50 per cent, duty and the price of a middy of beer carries 40 per cent. duty. Those are the things that occur under this Government.

From time to time every honorable member on the Government side stands up and boasts about the number of motor cars on the streets and about the prosperity that this Government is giving to the country, as indicated by the fact that people can buy motor cars. Then the Government decides to take away that prosperity by increasing sales tax. Its action is similar to the way it is solving the telephone shortage. The sales tax on motor vehicles is going up to 25 per cent. Wherever there is a possibility of grabbing a few extra pence by increasing sales tax or other indirect taxes, this Government moves in. That applies particularly in the motor car industry. Why should not a man have a motor car today? Do members of the Country Party think that it is a luxury for a farmer to have a motor car?

Mr Nixon:

– No.


– Of course they do not; but they support an increase in sales tax which will make it more difficult for the farmer to buy a motor car. On this occasion the Government may find, as it did in 1962, that the increase in taxation will tell very heavily against it. The taking of £64 million in increased sales tax on motor cars and other items may well tell heavily against the Government in the not far distant future.

I point out that for every man, woman and child in Australia today £57 18s. is paid in indirect taxation. The basic wage earner with three dependants pays the same rates of indirect taxation as the wealthiest person in the land.

Mr Clyde Cameron:

– Where did you get these figures?


– From the taxation authorities. This Government perpetuates and increases this most unjust and most vicious tax of our time. The sales tax on a Holden car is £150; on a Volkswagen, £120; and on a Mini Minor £118. They are vehicles for the average man. As you motor along the highway, the Treasurer sits smilingly at your side enjoying the ride at your expense because under a vicious law his ride is paid for by your hard earned income. Let us not forget the petrol tax that he is taking all the time, too.

When the wage earner lights his pipe or cigarette, or when the pensioner relaxes on a seat in the park to enjoy a cigarette, the Treasurer is with him in spirit, enjoying 50 per cent, or half of his cigarette through indirect taxation. When the worker, the pensioner, the housewife or anybody else, whatever his income, sips a beer, the Treasurer joins in the drink to the extent of 50 per cent, or half of the glass. The Treasurer takes, without any outward effect, a great portion of the pensioner’s or worker’s spending. Even when you get into your bath you are not free from the Treasurer. Having got into your bath or standing over your wash basin, you find that the Treasurer is there, because the soap has 25 per cent, sales tax on it. As the honorable member for Hindmarsh (Mr. Clyde Cameron) said, unless you use dog soap you cannot dodge the Treasurer even in your bath. I could go on all night giving a dozen and one examples of the grasping hand of this Treasurer and this Government which, by the imposition of indirect taxation, takes from the average person the pittance that he tries to save. Indirect taxation is unjust. If affects the poor and the rich alike. This system of taxation should never be tolerated in this country. The Government’ deserves to be defeated because of it.

Let us look at the position of age and invalid pensioners. A miserable increase of 5s. a week is being given to them. Discrimination of the worst kind is still practised against married pensioners. No attempt is made to restore the purchasing power that pensioners have lost as a result of increases in the basic wage without corresponding increases in pensions. Increased prices are absorbing pensions increases that are granted. The pension increase should be much more adequate than the miserable pittance that has been given in the Budget. The costs of cigarettes, tobacco, telephones and many other things are being increased. Many pensioners still have not a medical entitlement card because they have a miserable income of a couple of pounds a week. Today 105,000 pensioners cannot receive adequate medical treatment. The funeral benefit of £10 has not been increased since 1943. In 1949 the Prime Minister (Sir Robert Menzies) promised to remove the means test completely. But today he is further away from that than ever. Many pensioners are living in poverty. This contemptible Administration gives pensioners a miserable increase of 5s. as their share of the prosperity of this day and age.

Let us consider what is happening in respect of television and radio. First let me quote a few figures. The number of radio licences in Australia today is 2,238,438. The number of television licences is 1,584,016. The number of telephone services is 1,812,181. In addition, 50,340 people are waiting for telephones that this Government cannot give them. The Government tells us that it costs £570 to install a telephone in the city and £620 in the country. The reasons given by the Treasurer for the increased Post Office charges contained in this Budget would do credit to Gilbert and Sullivan. He said -

The Government therefore decided that it is necessary for Post Office charges for telephone services to be adjusted to levels which reflect the cost of providing those services. This will ensure that future demand will not be artificially stimulated to the extent that it has up to the present time.

There are 50,340 applications outstanding at present. The Treasurer tells us that the demand for telephones by the sick, the aged, the poor, the businessmen and other people who want telephones for all kinds of purposes is artificially stimulated. It is no wonder that last night the honorable member for La Trobe (Mr. Jess) did a daring thing for a Liberal to do. He stood up and made a speech against something. He would not dare vote against the Budget, but he condemned this proposal as the height of political stupidity. I will go further and say that it is the height of political injustice. The Government deserves all the condemnation that is heaped upon it.

It has increased the telephone installation fee from £10 to £15. It has also decided that it will increase telephone rentals by from 50 to 100 per cent. This is to be the Government’s solution to the problem of people demanding telephones. I thought the Leader of the Opposition spoke very soundly when he referred to the new Liberal approach to solving shortages in 1964, namely, making the cost so exorbitant that nobody can afford the article. The honorable member for Mallee thinks that the Government’s action is an intelligent contribution, for the simple reason that it is the only solution that the Liberals have. The Government puts telephones outside the reach of people and so solves the problem of the shortage. In a full year the increased charges will bring in £9,500,000.

I do not wish to go over the full range of what is happening in regard to postal services. This Government tells people who have been waiting up to five years for telephones that they should never have applied for a telephone. The Government has kept them waiting for a long time. It will now charge an extra £5 to install the telephone and double the rental, and then will insult them by telling them that they should never have applied for a telephone. The electorate will be very stupid if it does not take full toll of the Government when it goes to the people at the next election.

The Government is also increasing the cost of television licences at a time when the amount of viewing time is being reduced throughout Australia. The Government will give the people a combined television and broadcasting licence for a reduction of 5s. What a remarkable reduction - a little more than the price of a packet of cigarettes. The Australian content in television programmes is dying; repeat programmes are the order of the day; advertising is excessive; and huge profits are being made by the owners of the commercial television stations. Yet this Government is taking full toll by extracting additional revenue from the pockets of people who are forced to watch some of these programmes. This impost on the average person will total about £9,500,000 per annum. It cannot by any stretch of the imagination be justified.

But the Government is generous in some ways. A coloured telephone can be obtained without extra charge. I do not know how well you hear on it; it may not be any better than a black telephone, but it will not cost any extra to install. A blind person can get a free television and broadcast licence if he is over 16 years of age, but if a blind person of that age wants a telephone he must pay the full cost. We have the remarkable position under this Government of free television licences being given to blind persons, although they must pay for a telephone that is essential to them. No concessions in respect of telephone services are given to pensioners. I know that some blind persons, fortunately, can see in some kind of a blurred way a picture on a television screen, but at the same time it is stretching it a long way to say that this gesture of giving a blind person a free television licence is generous while such a person is being charged these high rates for postal services.

The Government is taking from the pockets of men and women all over the country money that it should be raising from other avenues, as I instanced in the early part of my speech. No kind of talk from the Treasurer’ nor the half-hearted support from honorable members opposite will justify in the minds of the people the impositions placed upon them by the Government nor the fact that they are being called upon to meet charges that should be met by people in the high and wealthy and influential sections of the community. The Budget, while taking a lot away from the people, gives nothing that they really require. It does not provide much relief for widows. There is no increase of the maternity allowance, the funeral benefit for age pensioners or the dependants’ allowance. Numerous drugs are still not available under the supposed free medicine scheme. The cost of medical attention still falls heavily on the taxpayer who must find about two thirds of the cost, and the Government has made no effort whatever to grant the wide range of social services that is so necessary. No provision is made in the Budget or in any other proposal so far brought forward to provide dental treatment for the people. The people of Australia are reputed to have the worst teeth of any people in the world. This is the result of the Government’s neglect to provide a dental scheme.

In view of the state of the economy, these matters should have received attention, but this Tory Administration prefers to let those who need assistance stagger along and to give benefits to those people who can well afford to pay more. My time is somewhat limited and I will not be able to deal in further detail with the Budget proposals. I join with my colleagues in supporting the amendment that has been moved. It is an indication of our dissatisfaction with the Budget and, I believe, of the dissatisfaction of the Australian people. The Budget typifies all the worst features of Tory and Conservative thinking. Above all else, it shows the need for a change of government and a revitalising stimulating national programme of development and stability. The present Administration owes its existence more to good fortune than to good government. Good seasons, good markets and the sound basis laid by a Labour government have brought what prosperity there is in this country. We have had this prosperity despite the Government’s activities.

The Budget is full of injustices. Its crippling taxation, miserable benefits to pensioners, increases in radio and television charges, stimulus to higher costs and its deliberate patronage of the powerful and wealthy supporters of the Government should be a clarion call to members of the Labour movement everywhere to unite and work for the defeat of the Government, lt should be a clarion call to all fair minded people, particularly those misled at the last general election by the vile campaign on television and radio conducted by the enemies of Labour, and they should vote against the Government at every opportunity. Above all other considerations, the Budget should forever be in the minds of the Australian people as a reminder that the MenziesMcEwen Government stands naked and unashamed as the protector of the wealthy and the oppressor of the underprivileged, and for this the Government should be condemned and voted out of office.


.- The honorable member for Grayndler (Mr. Daly) went through a long tirade, grizzling and growling like a bear with a hangover because of the taxes and charges placed on the community by the Treasurer (Mr. Harold Holt). He then moaned and groaned like an old cow with bloat because the Government did not give enough handouts. This is fairly typical of the attitude of the Opposition members. They all expected this Budget to be a Budget of handouts, as though Father Christmas had come here again. Of course, they have been in Opposition for so long now that most of them have never had the experience of being in government, and it will be many years before the Opposition returns to office. Opposition members do not have the sense of economic responsibility that honorable members on the Government side of the House have.

The honorable member for Grayndler criticised the Treasurer for not forecasting accurately the income and expenditure of the Government in previous years. But I would remind him of the forecast of gloom and doom that he made with some of his colleagues in 1961, which was at the time I was first elected to the Parliament. The gloom and doom that they forecast did not, because of the Government’s wisdom, come to pass. The honorable member for Grayndler followed the Labour line of attacking the big companies. He especially mentioned the Colonial Sugar Refining Co. Ltd., Imperial Chemical Industries of Australia and New /Zealand Ltd. and General Motors-Holden’s Pty. Ltd. These companies, of course, are amongst the biggest employers of labour in the Commonwealth. The honorable member should not lose sight of this fact.

The facts of life are that the economy is very buoyant. Whether the Opposition likes it or not, the economy is in a very liquid state. This has been brought about, in the main, by good sales of our export commodities. There has been a good clearance of wool at a better price than we have had in previous years. There has been a total clearance of the stocks of wheat that were building up and these have been disposed of at reasonable and satisfactory prices on the world’s markets. Meat is being sold at satisfactory prices not only in America but also in Europe, where a rejuvenation of the markets has given considerable assistance to the meat industry. The increased liquidity of the economy has caused the Reserve Bank of Australia to drain off some of the pressure on the economy by calling up some of the funds in the hands of the trading banks and placing them in the statutory reserve deposits. The bond rate has been increased as another means of reducing the pressure.

In the light of these conditions, the Government brought down a budget that would maintain stability in the economy, while allowing some factor for growth. Let us not forget that the Australian electorate gave the Government a mandate only a few months ago to continue this policy of stability and growth. The Government, however, has no control over many factors that affect the economy. I have already mentioned one of these factors and that is the state of the export markets. The sale of our primary produce overseas is the springboard of our prosperity, but the Government has no control over the state of the export markets. Fortunately, in the past twelve months, they have been in a fairly satisfactory condition.

In my opinion, another very powerful weapon affecting the economy is the Commonwealth Conciliation and Arbitration Commission. It is one of the most powerful fiscal weapons in the community. I felt sorry for the Treasurer. He had to bring down a Budget within a few weeks of the Commission’s announcement of a basic wage rise of £1 a week. I have earlier in this Parliament criticised the criteria used by the Commission in forming its judgments, but it is the prerogative of the Commission to decide on the criteria that it will use. I do not think the criteria that the Commission is using as a method of assessing the needs of workers can be very accurate when two judges decide that the increase should be 10s. a week, which would add £50 million a year to the economy, and another two judges decide that the increase should be £1 a week, which would add £100 million a year to the economy. The Commission put all sectors of the community to great cost by asking them to provide evidence; but this is the result that we obtained. The Commission looks at capacity to pay. Its judgment is based on what the economy can afford to pay. Prior to the war, this criterion was in use. In has been in use for a period of well over 30 years and was adopted when the situation in the economy was completely different from what it is now.

Prior to the war, Australia’s total economy was dominated by the influence of primary industry. There was very little manufacturing industry in Australia at that time. Circumstances changed during the war. The need arose to develop heavy industry, and there was certainly a great growth in secondary industry. Since the war, this Government has maintained the policy of expanding secondary industry so that more people can be employed. There is no doubt that manufacturing industry is the springboard of employment. While it may be the largest employer, the service industries are a collateral to the growth of the manufacturing industries.

Primary industry has increased its productivity by 50 per cent., but it has not increased its labour force. I cannot quote for the statistically minded the percentages of the productivity of various industries in relation to the gross national product prior to the war because the figures are not available. But it is interesting to note that since the war, primary industry in 1948-49 produced 21.3 per cent, of the gross national product. In 1962-63, this figure had been reduced to 1 2.6 per cent. The manufacturing and service industries - I put those industries together for the purposes of this debate - produced 40 per cent, of the gross national product in 194S-49. This was increased to 46.6 per cent, in 1962-63. So, whereas before the war the bulk of the weight of the judgment of the Commissioners was taken on the effect it would have on primary industries, today the position is different. I believe that the bulk of the weight of the judgment would be taken against the background of its effect on this dominating sector of the economy, the manufacturing and service industries.

The Prime Minister (Sir Robert Menzies) in delivering the John Storey Lecture mentioned the fact that many people have the idea that the Commonwealth -

  1. . has to sail in treacherous and narrow waters between the Scylla of the Arbitration Commission and the Charybdis of the Tariff Board.

I am inclined to agree with this proposition. A judgment taken by the Tariff Board on whether an industry deserves protection is based on the criteria of economic and efficient. There are many arguments which could be used about the value of this judgment. We must all respect the Tariff Board in its assessment of these cases, keeping in mind that its experience is vastly greater over a number of industries when it applies its mind to any particular industry. The Board gives protection to industries on the criteria of economic and efficient. If has to keep in mind when it is considering the kind of protection that should be given the sophisticated trade methods of international competitors who are prepared to dump goods at well below cost price. I do not think that the Board would have consideration for the profitability of the industry concerned when assessing the rale of protection. It would be pointless to decide to give an industry some protection if those concerned with that industry, were not prepared to make it profitable. I am quite sure that, in its assessment of the situation, the Board does allow for the profitability of the industry. Indeed, the Special Advisory Authority who has been set up to handle emergency cases uses profitability as a simple criterion. It is the logical criterion to use because, no doubt, an industry can produce audited and documentary evidence to show that it has been damaged. So, it is true to say that manufacturing industries have their profitability protected in the national sense. I do no mean in the door-to-door sense with their competitors selling something around the roads. I mean in the overall national sense that the tariff policies of the Commonwealth would protect the profitability of industries.

I submit similarly that the capacity of industries to pay is also protected. I believe that they have this facility of protection which gives them the same ability to meet the criterion of capacity to pay used by the Commonwealth Industrial Conciliation and Arbitration Commission. I believe that this puts manufacturing industries in a slightly more favorable position than the rural industries when having to meet increased charges such as the recent £1 increase in the basic wage. The position of rural industries is completely different in this regard. Rural industries have not the ability to pass on their costs. Since the war, the productivity of rural industries has increased by 50 per cent. This has been brought about by improved methods, better farming, better use of seed and fertilisers, better husbandry and stock, and better grasses and the like. This increased productivity has assisted the farmer in meeting the increased costs which have occurred throughout the community over this period of years. But I say that sooner or later a farm will reach its maximum limit in bearing these increased costs. Sooner or later it will be impossible to get more milk from the cow, more wheat from the acre, and more wool from the sheep’s back. So, we must have great regard for stability in the economy.

I am very delighted that one thing this Government does have is regard for stability. The Minister for the Interior (Mr. Anthon’y) quoted tonight a depreciation of only 2.2 per cent, over a period of 10 years. With a system of inflation with costs increasing, we could find that Australia, in common with the very heavy industrial nations of the world, would have the situation where the rural industries were calling on the Government for more assistance. When I say this, I think of a friend of mine in England. He receives a Government subsidy of 8s. in every £1 that his farm earns. To my mind, that is what is going to happen in Australia in the years to come if the arbitration system of Australia does not have regard for Government policies. If we do not do this, there is going to bc a greater call for Government assistance. If we do not receive Government assistance in the rural industries, we might as well give this vast country back to the blacks and the rabbits.

I know that there is no simple answer to this problem. But I believe that a certain change in emphasis must come from the Commonwealth Conciliation and Arbitration Commission, the Tariff Board and the Commonwealth Government. Firstly, I believe the Arbitration Commission has to place more stress in the long term on the effect on the primary industry of the decisions it makes. I do not growl for one moment at the worker receiving an increased wage or obtaining an increased share of profits for his labours. But what is the point in giving the worker another £1 a week if it is eroded away within a few weeks by increased costs? The worker is only deluding himself if he thinks he is better off with his increase. I sometimes wonder whether the Tariff Board, when it is considering the level of protection to give to an industry, has regard to the amount of over award wages paid by companies. I wonder whether or not in a situation where there is a shortage of labour, and great competition for labour, and where large over award payments are made, we are not paying increased protection for those over award payments.

I would like to see the Tariff Board make sure also that any industry that has a large inbuilt over capacity will eventually become a high volume producer and a low unit cost producer. This is the sort of change of emphasis that I think are needed to meet this situation. The most serious part of the system, to my mind, is the criterion of the Arbitration Commission which is capacity to pay. It is up to the

Commission to look this problem squarely in the face and see what effect it is having on Australia as a whole. We do not want to get the economy into the situation where rural industry is completely dependent upon Government assistance. This is the situation in England, America and many other industrial countries. I believe manufacturing industries have a responsibility in this regard also to develop the export business. Most decidedly, I would be delighted to know that a manufacturing industry was exporting. We would know that our tariff policies were successful in that they had been able to produce and build up an industry to the degree where it could compete on overseas markets rather than just live under the umbrella of tariff protection in Australia. No doubt there are many manufacturers today who are content to build up production to the level of domestic demand and to stay there, in the happy situation of being protected by the umbrella of tariffs. But they have a responsibility to get out into the export field, and I am pleased to know that the members of the Government, and my own Leader in particular, have been very keen to encourage manufacturing industries to get out into the export field.

This is where I see one of the dangers of the investment of overseas capital in Australia. Unlike some of my friends opposite, I am not a slavish opponent of the investment of overseas capital, but, to my mind, one of the dangers is that overseas companies may come into Australia, buy out an established industry or build up an Australian industry and then be prepared to produce under the umbrella of tariff protection, not going” out into the export field to compete against parent companies. To my mind, that is one of the big dangers of overseas investment. I have with me an annual bulletin, “ Overseas Investment in Australia “. It is series No. 7, for the year 1961-62. I think it is the latest one published. One can read it, but one has to be a Sherlock Holmes to understand it. It really does not show the trends of overseas investment in Australia. It sets out how much money is coming into the country and it deals in general terms with portfolio investment, but it does not tell me what I would like to know. I would like to know in some detail the sorts of Australian companies that overseas investors are taking over. I believe it is time that the Government issued a White Paper telling the people of Australia what overseas investors are doing in this country, and what industries overseas investors now control. This document gives information relating to the percentage of industry controlled by overseas interests but it does not set out the types of industry affected. I should like to know, for instance, what percentages of our food industries and of our manufacturing industries are completely controlled by overseas companies.

I believe that one of the great hopes for the economy of Australia is the meeting of the parties to the General Agreement on Tariffs and Trade which is now taking place, with a view to removing the barriers raised by the industrial nations against agricultural products. I do not know whether 1 am just hanging my hat on a cloud with relation to this matter, but I do think that the lifting of such barriers is one of the possible solutions to the problems of an economy like that of Australia. We have to build up manufacturing industries to increase our population. If we can get freedom of movement for agricultural products in industrial nations overseas, I think that it will remove much of the strain on our rural producers because I think that prices for primary products will then find a more realistic level in overseas markets and our producers will not be competing, as at present, not only against the tariffs imposed by other countries but also against heavily subsidised agricultural industries.

T hope that the Government will note the three or four things that I have said I would like to see. I certainly hope that the Commonwealth Conciliation and Arbitration Commission will take note of my wish for a change in emphasis; I hope that the Tariff Board will note my wish for a change in emphasis; and finally I hope that the Commonwealth Government will produce a White Paper on overseas investment.


.- May I give the honorable member for Gippsland (Mr. Nixon), one fact on which to ponder? I have noted his objection to overseas investment.

Mr Nixon:

– Do not misquote me.


– I will not misquote you, and I certainly will not misquote your leader, because I propose to give some statistics that he gave to this House at my’ request. At the present time, there are current 1,100 agreements between overseas interests and Australian firms with respect to patents and processes where franchises are imposed. In 800 of those cases, the franchises are limited to Australia, Oceania and New Zealand.

I support the terms of the amendment moved so ably by the Leader of the Opposition (Mr. Calwell). May I introduce my remarks with a quotation from Proverbs XXX, in the Book of Books. It is -

There be three things which are too wonderful for rae, yea, four which I know not:

The way of an eagle in the air; the way of a serpent upon a rock; the way of a ship in the midst of the sea; and the way of a man with a maid.

Perhaps to that may be added a fifth, which I share with the people of Australia. It is complete mystification at the principles, motivation and economic justification of the current Budget. These glad tidings of great joy were delivered with great eclat by the Treasurer (Mr. Harold Holt). Appropriately, this gallimaufry of fact, theory and guesswork was delivered on the coldest Canberra day for many years, a day of snow, frost, sleet and icy blasts from the Brindabella Range, lt presented cold comfort for business and industry, colder comfort for the working man and his wife, and the starkest frigidity and degradation for the pensioners and indigent of Australia/ The Budget has been correctly dubbed the “Dollar Budget”. This Government, of course, believes in dollar diplomacy. It even prepares a dollar currency. It actively seeks the unrestricted entry of investment dollars to this country. What could be more appropriate, therefore, when this Government opens the bowels of its compassion than for it to produce a miserable, paltry, niggardly dollar increase for the pensioners? Of course, the Government will extract the utmost political advantage and kudos from this, lt will expect a proper knuckling of foreheads and tugging of forelocks; it will expect proper genuflections and curtsies by the recipients of its bounty.

After all, what does a dollar represent today in terms of the necessaries of life? It represents one pound of butter - second grade, of course, because the prime export quality goes overseas and attracts perhaps ls. 6d. per lb. less than is being paid for the inferior product which is being put upon our tables. If I am to draw a true picture of the attitude of the Government and its supporters to the needs of the pensioners and the indigent, I can do no better than quote from a survey taken in Melbourne by Mr. Alan Hughes, of the Monash University, between 7th November and 21st December last year. In the course of that survey, he interviewed 427 people on 12 major questions. On the question of the comparative importance of election issues, the survey disclosed that supporters of all parties ranked education first. Liberal Party and Country Party voters ranked housing second and social services last.

As an alternative, the pensioner, from his princely dollar dole, can purchase three whole extra loaves of white bread weekly on which to regale himself whilst contemplating the munificence, the paternal benevolence and the solicitude for his welfare of this National Government. He can ration himself to one half loaf a day, leaving appropriately one day for fast and abstinence, when he can suitably mortify himself lest he become so presumptuous as to demand a decent standard of living from this affluent society. There is a further consolation which the pensioner who happens to be a Housing Commission tenant in New South Wales can derive from the present increase of 5s. a week. He will be faced with an increase of ls. a week in his rent. Immediately he receives the 5s., the pensioner who is fortunate enough to be a tenant of a Housing Commission home or flat in New South Wales, or any other State in Australia, will be required to pay ls. a week more t by way of rent. It is small wonder, then, that there is a witch hunt in full swing in the party rooms of the Government. The witch hunt, of course, is for the luckless lad who dropped such a clanger in the “ Four Corners “ television programme by presenting the living conditions, the poverty and sheer desperation of pensioners in this Australian age of enlightenment. The people can rest assured, no doubt, that their paternal Government will see that this does not happen again. The skeletons will be properly concealed in the cupboard.

I listened with the greatest interest to the apologia of the Prime Minister (Sir Robert Menzies) last night. I listened to his doxology of praise: Praise this Government from whom all blessings flow! The cornucopia which he tipped before the people of Australia, and particularly the pensioners, was something to marvel at. It was 200 years ago that Warren Hastings, when impeached before the House of Lords, said that he stood amazed at his own moderation. Today, we have the Prime Minister of this country saying that he stands amazed at his liberality. After stuffing pensioners pockets with pounds, after stuffing their stomachs with food, after ensuring that they have low cost housing, it was just more than they could possibly endure. What hypocrisy! What a travesty of political and social justice!

What are the implications of the Budget for a worker on award wages? It represents to him frustration; it represents bewilderment. There smoulders in his mind and heart a cynical resentment and distrust of the arbitration system under which he is forced to fight for three years to get a belated £1 increase in his basic wage, only to have filched it from him in three weeks. Of course, the Budget is outstanding as a work of political prestidigitation, a sleight of hand, not to mention fiscal supererogation. In both those respects this Budget stands supreme. For the worker under a Commonwealth award the Treasurer completed in one night the erosion of the £1 basic wage increase by the harpies and racketeers in their frantic price rises for goods and services. Of course, the Treasurer himself has a vested interest in the matter. In fact, economists say that he is the major beneficiary when the multiplier effect of the increase is taken into consideration. After any sum of money has been injected into the economy in the form of increased wages it passes through various hands and, in each case, tax is levied by the Treasurer. A very substantial proportion remains sticking to his fingers.

After the trade union advocates have steered and fought their way through the traps, bottlenecks, hazards, frustrations and legalities of arbitration, after they have finally established irrefutable increases in living costs, after they have proved beyond doubt the increase in industrial productivity and, of course, after the learned Commission has been soothed into forgetting its unreal timidities on the ability of industry to pay, then and then only is a grudging, belated and inadequate increase given in a deferred judgment. Then, of course, the Treasurer smilingly and skilfully extracts by income tax his levy. Add to this the basic unfairness of the concept and structure of the system of taxation today. For every £1 indirect and direct taxation increase in this Budget payable by companies and higher income groups, £2 is paid by the worker and those on lower incomes. Australia is, of course, par excellence, the home of untrammelled and uninhibited capitalism, Here we lag 74 years behind the United States of America, the arch exponent of capitalism in the world today, because the Sherman Act. The Clayton Act, of course, has never been heard of in Australia. The mere suggestion of a securities exchange commission would horrify a number of gentlemen inside and outside of this House. Is it any wonder, then, that the Budget which has been presented to us is a compound of the finer economic minds and the myths and fallacies of the nineteenth century? Of course, there is the most tender solicitude, as was pointed out by the honorable member for Grayndler (Mr. Daly), by this Government for the interests of monopoly, and even of oligopoly. You can turn to any major field of industry - steel, sugar, glass, motor vehicles - wherever you will, and there you will find a financial grouping which dominates a particular economic sector.

The total company tax paid in Australia for 1963-64 was £293 million. The total income tax paid for the same period by individuals was £636 million. Let us now turn to the field of indirect taxation, a type of tax which is iniquitous in the extreme and which bears no relation to ability to pay. It falls most unfairly on the weakest income group. Take two items alone to illustrate my point. Excise duty on beer in 1963-64 was £123 million - nearly seven times the income tax paid by the Broken Hill Pty. Co. Ltd. That is a sobering thought indeed for any Australian about to bend his elbow and down another schooner. If he were to pause further and consider that in the last year £82 million came out of his pocket for excise on tobacco and cigarettes, the enormity of his contribution to Commonwealth finances would be apparent to him.

The tobacco growers of the Ovens Valley, I understand, are staging riots and demonstrations because they cannot sell their product. They are envious of their fellow growers who can get 7s. 6d. a pound, or whatever the current price may be, for their leaf. What are their feelings when they consider that the smoker of tobacco in the form of cigarettes is paying £8 to £9 per pound for the finished product? Of course, with smoke operas to be financed and the cost of the insidious television prestige advertising which is such a feature of our entertainment today, and which makes such a notable cultural contribution to the Australian way of life, a little latitude must be allowed to the tobacco combines. Nevertheless, with tobacco and cigarettes at such bargain prices, obviously the increase in cigarette prices is fully justified. It is comforting too, as the honorable member for Grayndler pointed out, to know that there is no sales tax on dog soap. In 1946, in an American magazine, it was admitted by Proctor and Gamble that 45 per cent, of the cost of their product went in advertising. There is a strong case to be made out for the abolition of any taxation concessions in respect of advertising on sales of tobacco and soap.

Today in this chamber we had a doubtful benefit of hearing a question asked by my worthy neighbour, the honorable member of Macarthur (Mr. Jeff Bate), who seeks persistently to improve his knowledge of affairs in my constituency.

Mr Mackinnon:

– Very generous of him.


– Most generous indeed and most indiscreet. The honorable gentleman represents one subdivision comprising about 3 per cent, of the total population of the city of Greater Wollongong, and in that subdivision he has neither the respect nor the confidence of the people of the area and cannot even secure a majority vote. That gentleman today puts himself forward in this House as the champion of the Broken Hill Pty. Co. Ltd.

I came into this House for the express purpose of seeing that justice was done by the National Parliament in respect of my constituents. I came here to see that the bill was presented fairly and squarely to the people who were extracting a torrent of wealth from the labours of my constituents and who were prepared to offer them nothing in return except substandard wages for semiskilled and semitrained groups. The figures quoted showed a net profit of £18.5 millions for the Broken Hill Pty. Co. Ltd. and its subsidiary, Australian Iron and Steel Pty. Ltd. la point of fact, the gross profit was of the order of £58 million. According to the calculations of the financial editor of the “Sydney Morning Herald “ the imputed profit per ton of steel produced was £16 10s., and 3,250,000 tons of steel are produced every year in my constituency.

This same company chose at Whyalla - and it is to be given credit for it - to build a small city, to build houses for the people of that city and to provide the city with the amenities and the ordinary utilities necessary for a civilised community. In my constituency the company has done precisely nothing. The honorable member for Macarthur cited the Green Valley housing project near Liverpool on the periphery of the metropolis of Sydney. That project represents the major housing development to meet the needs of the metropolitan area of Sydney in which there are 22,000 approved applicants for Housing Commission homes. Within my constituency there are at present 2,780 approved applicants patiently waiting for their turn to come. The Housing Commission of New South Wales has a magnificent record of achievement. It has built 5,300 homes in the city of Greater Wollongong out of a total of 33,000. Another 600 homes are in course of construction at the present time. The Commission has spent £18.5 million on housing. It has spent to the limit of its capacity and it has 3,500 allotments of land available for further development.

What is the situation today? The Minister for Housing (Mr. Bury), whose portfolio is an exercise in public futility or political futility, has the gall to tell us that the loan allocation under the terms of the Commonwealth and State Housing Agreement will be increased by a whole £500,000, bringing it to a total of £51 million. Of that the sovereign State of New South Wales will get £17.5 million. Out of that amount will come 30 per cent, for the needs - and the legitimate needs too, I do not cavil at the allocation - of the co-operative building societies. The remaining £12 million will build precisely 4,000 homes for people throughout New South Wales, and the honorable member for Macarthur wants all of them for Greater Wollongong. I want my share, and I fought valiantly and successfully to get my share, and I strongly resent and will tear to pieces any man who has the gall, the impertinence and the stupidity to make an attack such as that made by the honorable member for Macarthur on a Government which has discharged national responsibilities in an area of national importance.

I hear many honorable members opposite trying to interject. These are the advocates of monopoly capitalism. I am giving the House the stern realities. I could quote from the report made by the Brotherhood of St. Laurence, which gives information in respect of Melbourne,, where there are classic examples of the. housing problems of low income groups, and I could show a precisely similar situation in my constituency. I could show, word for word and sentence for sentence, that the situation is exactly the same.

If we examine the latest statistics irc find that of 4.4 million taxpayers in the Commonwealth today 2.6 million are: earning less than £1,099 a year each. It is an acknowledged and widely accepted fact that no person with an income of less than £20 a week can save today the deposit necessary, under orthodox housing finance procedures, to purchase a home. In other words, 60 per cent, of the people have not a dog’s chance of acquiring homes for themselves. In my constituency the position is even worse, because the average award wage for semiskilled and unskilled steel workers is a shade less than £19 a week, and that is before taxes and deductions are taken out of it. There would be 80 per cent, at the very least, perhaps 85 per cent., of the workers there who have not the slightest hope of saving the £1,000 or £1,200, whatever it might be, which would be necessary for a deposit on a home. The limit of the expectation of such people would be to scrounge together somehow a miserable £90 to put down as a deposit to purchase a Housing Commission home.

These are the hard realities of life in an area where every worker is making £2,500 a year profit for his employer. I am proud of the steel industry and of the achievements of the Australian workman. I am proud of his technical efficiency. What a travesty of economic justice it is that in an area where torrents of wealth are being poured out foi a few employers people are living at these miserable standards. There is a simple choice for the average young woman in my constituency today. I am indebted to the Minister for Labour and National Service (Mr. McMahon) for belatedly admitting the realities of the employment situation in respect of women in Greater Wollongong. The fact is that 500 married women were dismissed by Australian Iron and steel Ltd. and the Broken Hill Pty. Co. Ltd. In Greater Wollongong we have a twojob economy. There is virtually a working depression, because the wage paid to the average worker is utterly insufficient to provide for even the basic necessities of life.

Mr Cockle:

– What a sad story you tell.


– It is not a sad story. I am giving the facts. I have before me the transcript of an interview conducted by Mr. Penlington in the programme “ Four Corners” on 4th April of this year. This is the record of a typical interview, giving typical questions and typical answers. The questioner asked the first woman: “ Why are you going to work? What is your purpose? “ The woman replied that she needed to buy furniture and other things. The transcript reads -

Woman: Oh, furniture and things like that you’d have to wait for, well working you can get them a lot quicker, and houses and things like that you’ve got to save for a long lime - it does help by working.

The second woman was an immigrant, and the transcript goes on -

Second woman: The first time I didn’t have any money much you know so I had to come to work to build a house. When 1 came out here I had nothing.

Third woman: Well, I’m getting married in a week’s time and I’m coming back for about three years and -

Penlington: Do you think you’ll come back here to work after your children have arrived?


– Order! The honorable member for Warringah will cease interjecting.


– The transcript of the interview continues -

Third woman: No I won’t. I want to bring my children up myself instead of sending them to . . . instead of other people having to look after them. Paying off a block of land and getting a home, paying off furniture, and that’ll give us a bit of a chance to get ahead.

Penlington: Do you find that many of your friends are doing this sort of thing?

Third woman: Oh yes, practically all of them. 1 have here also the transcript of an interview with the manager of a store where about 350 women lined up seeking jobs. The honorable member for Macarthur said that they were attending a bargain sale. Forty per cent, of these were married women. The manager of the store was a Mr. Taylor. The transcript of this interview reads -

Penlington: Were very many of these absolutely desperate to get a job?

Taylor: There were quite a few of them quite candidly who needed, who seemed to need this subsidy, and likewise they just seemed to be very urgent to get a job. There’s no doubt about that - that was most outstanding.

This is the situation today, Sir. There is a sort of covert genocide. The average young married woman in any industrial area today has the choice of rearing a family or going out to work to supplement her husband’s income so that ultimately they may be able to buy a home. Australia is a country that is screaming out for development. We need population. We need large numbers of people. We need the best of all migrants - the young Australian born in this country to parents Australian by birth or adoption. Why should we object to finance being made available for housing? Why should we reckon the cost? What does it matter to us if £3,000 from the public purse is spent to provide accommodation for a family? Each child born in Australia, in the normal span of its working life, will probably add anything from £110,000 to £120,000 to the gross national product. What a wonderful return for posterity. Yet this Government adopts the paltry view that it is doing its utmost in the national interest. It is doing less than nothing. It is murdering unborn generations of Australians. This is a shame and a disgrace. Shame on the Government and the Minister that tolerate such a situation.

To add insult to injury, some months ago the Minister for Labour and National Service chose to go to a constituency adjacent to mine. He appeared with all the display of an army under its banners. Accompanied by his myrmidons, he perpetrated a display of discourtesy such as I had not previously experienced in 14 years of parliamentary life. When I was member of the New South Wales Parliament, a Liberal member for a constituency adjacent to one visited by a Minister in the State Labour Government would at least be paid the courtesy of an invitation to any public gathering that the Minister attended. On the recent occasion, every possible means was adopted to bypass me. The honorable member for Macarthur chose to organise in his own constituency a meeting to which he attempted to entice the Mayor and Aldermen of the City of Greater Wollongong, knowing that I could not be present. This was done in order to prevent me from presenting the facts that I have put before the House this evening and to save the Minister and his party from discomfiture and political embarrassment. That is the hard truth. The Minister at least had sufficient common sense to keep his mouth shut, to promise nothing, to listen carefully and then to depart. The parting shot of a local daily newspaper commenting on the incident, was simply this: “He came here. He gave nothing. We expected nothing.”


Mr. Acting Deputy Speaker, it is a refreshing and invigorating experience to rise before such a full House at this time of night and to have the opportunity to express my views on the Budget for the financial year 1964-65, presented by the Treasurer (Mr. Harold Holt) just over a fortnight ago. We have seen considerable comment on this Budget, mainly by the Press, and we have heard rather inferior, irregular and illogical comments from Opposition members. Indeed, I think that throughout the whole of this debate responsibility for probing and constructively criticising this Budget has devolved on honorable members on this side of the chamber.

I listened with great interest to the honorable member for Cunningham (Mr. Connor). As I listened to him, I found myself sometimes in the heights of enthusiasm and at other times in the trough of depression. At one moment, he was praising the magnificent housing efforts of the New South Wales

Government, which are represented mainly by the Sydney Opera House. In the next minute, he was citing dire conditions that he said existed in various parts of Australia as a result of the wickedness of this Government. I do not believe that people take that sort of thing very seriously. The honorable member’s remarks, if we think in terms of the consideration of the important problems that are the concern of the country as a whole in the light of a Budget, were not a very valuable contribution to this debate.

A Budget, like a lot of other features of life, shows up according to the way one looks at it. Many people think of the national Budget in terms of the number of handouts or concessions made in the period immediately prior to its presentation. The Budget is usually considered in the context of the fiscal or monetary measures taken for the purpose either of quickening the tempo of the economy or, alternatively, of actively and deliberately reducing the tempo. Obviously, the Budget must be looked at also in the context of the value of the gross national product, the balance of trade position, the volume of national revenue and forecasts of future economic activity. But I believe that the factor that applies above all, particularly at the present time, is the situation in South East Asia, and specifically the application of that situation to Australia, New Zealand and other nations faced with the threat of expanding Communism and increasing Communist penetration. Any national Budget must be framed in the setting of our own defence requirements, our obligations, or the possible extension of our obligations, to assist our good friends as a means towards our own self preservation, and the extraordinary complexity of the consequences of these objectives on decisions relating to our military equipment and tactical organisation. These considerations are constantly being modified by rapidly advancing military technology and varying world strategic forces.

Australia’s own specific problems are further complicated because we are continuing, and must increasingly promote, the rapid expansion of our population, our great industries, our national production and our investment in the capita] goods required by both public and private enterprises. People are singularly unheeding, I believe, of the inflationary pressures in our enonomy that all these forces create. In fact, some schools of thought favour mild inflation, as has been mentioned by the honorable member for Yarra (Dr. J. F. Cairns). Certain honorable members opposite quoted Sir Douglas Copland, one of the advocates for mild inflation. At present, we have coupled with this situation a world atmosphere in which we find ourselves obliged, for the sake of our preservation as a nation, to devote considerably more of our national reserves of manpower and investment capital to increasing our insurance against aggression and to honoring our obligations to our friends. Therefore, it is obvious to me that it is fantastic at present to advocate any form of fiscal measures to increase the tempo of the economy. The inflationary pressures generated by the combination of the forces that I have mentioned are so considerable that, if they were given free rein, they would have serious effects on our cost of living, production costs and the various other yardsticks that we use to determine the state of our economy. So I consider, basically, that anybody who considers this Budget on its merits must realise that, although it may not be spectacular in terms of handouts, it has at least one basic underlying principle. That principle is that we must try to maintain the stability and promote the growth of this country.

The amendment proposed by the Leader of the Opposition (Mr. Calwell) was extraordinarily ill framed. It was certainly not couched in good English and it certainly did not represent good logic. I believe that the people of Australia, if they had an opportunity to analyse the amendment and study it carefully, would be extremely disappointed to think that this is the best the Opposition can do at present.

I would further remind the House that in this present inter-governmental financial arrangement which exists within Australia and in which the Commonwealth Government has the main responsibility of preserving the economy on an even keel, there are sufficient avenues for State Governments to make what I would describe as good fellows of themselves with their own voters with the object of attracting continuing support. This they can do by taking their own unilateral actions which add to the national cost structure, by encouraging or lying down before demands for shorter hours, increased leave and additional fringe benefits which add to inflationary pressures. At the same time, these actions are matched by such alternative measures as imposts in the form of increased land tax, increased rail freights and increased public transport charges which have only one effect - to inflate costs.

I think it was the honorable member for Balaclava (Mr. Whittorn) who, during the course of his remarks, mildly criticised the power of the Commonwealth Conciliation and Arbitration Commission to affect the general wage structure. I believe the point he was making was that the Commission was taking out of the hands of the Government’s economic advisers, or the Government’s authorities, the ability to determine the tempo of the economy of the country because by these actions the Commission was fixing conditions which were completely outside Government control. I agree with the principle that they should not be controlled by governments. I believe it is appropriate that conditions should be fixed by an independent tribunal. But that is only half the story. I repeat again that the action of State Governments in taking measures to deal with their own immediate situation has had a very disastrous effect on the general economy of Australia. It is quit idle, in these conditions, to criticise the Commonwealth Government in regard to the general economic structure when it has no control over it.

Without wishing to point the bone, I suggest that, in these respects, successive governments in New South Wales have established a unique record for political and financial irresponsibility which cannot be matched by any other State although, for a time, Queensland ran a close second. Sooner or later this must reflect the whim of the vote-seeking State politicians throughout the whole national structure and bear directly on the measures to be adopted by any responsible Commonwealth government.

My colleague the honorable member for Mackellar (Mr. Wentworth), who has some very strong views on this subject, has repeated from time to time the accusation that Victoria has been successful in chiselling New South Wales in the distribution of funds. I think he must agree with me to this extent: The success/on of economic knocks that New South Wales governments have given Australia must more than make up for any imaginary or real disadvantage that New South Wales has suffered.

Mr Jeff Bate:

– That is slightly involved.


– But it is factual. I hasten to add, for the benefit of my Victorian colleagues, that the Commonwealth is not entirely blameless in this context. Certain measures introduced at the Federal level have imposed unavoidable costs on the States of which no better example can be mentioned than the incidence of payroll tax which I have assailed in the past with all the logic at my disposal. I regret to say that I have not even stirred a ripple on the glassy sea of fiscal foolishness.

The cumulative effects of the incidence of payroll tax are so obvious at a time when we are using our best endeavours to restrain costs so that we can export competitively, that we have been obliged to institute a system of rebates of the tax to exporting concerns. Honorable members will note that, according to the Budget papers, some £70 million will be collected this year in payroll tax. That amount excludes the rebates that now obtain. The fact that we are making these rebates, which I admit have been reasonably rewarding, is an open admission that they are necessary to encourage our exporting industries to compete, and surely it eventually must provoke the decision that this tax not only has a direct effect on exports but also that its indirect inflationary effect on the whole economy is beyond calculation.

I speak feelingly on this subject on behalf of our great primary industries in the full realisation that no longer does payroll tax fall directly on the average primary producer. As against that, the extra cost added to our local governing bodies, most of which are obliged to contribute, and the inbuilt payroll tax content in everything manufactured in Australia required by our primary industries, must have only one effect on the cost structure of the man on the land. In this Budget the estimate of payroll tax collections for the current year is £75 million, a tidy sum which I admit the Treasurer would not willingly forgo.

But when we realise that a very substantial portion of this is contributed by State Governments and State instrumentalities we must appreciate the dog eat dog nature of this impost.

I do not propose to weary the House with a detailed recapitulation of the history of payroll tax but it is rather interesting to note that despite the fact that the exemption has been lifted on a number of occasions the tax has been rising. In 1953 the exemption was lifted to exclude payrolls under £80 a week. In 1954 the amount was lifted to £120 and in 1957 it was lifted to £200. When I mention that in 1955-56 payroll tax collections amounted to £45i million and that in the present Budget we are budgeting for £75 million, which excludes the allowance for rebates for exporting concerns that I have mentioned, honorable members will realise how this colossus has grown around our neck.

I should like to go into a lot of detail on this subject. The Minister for the Interior took up the subject in a previous Budget debate. I joined the debate on a number of occasions. A study of the subject will reveal that there is a duplication in the sense that State Governments and State instrumentalities have to pay payroll tax and at the same time we have to hand out, in the form of reimbursements to the States, something to compensate them for the amount that they contribute. So it has a duplicating effect.

In this colossal Budget which provides for receipts of £2,529 million and expenditure of £2,511 million the Treasurer is aiming at a surplus of £18.5 million. Personally, despite the deprecatory noises from certain sections of the Press and the squeaks that have come from the Opposition, I agree entirely with the principle on this occasion of budgeting for a surplus. It would be the greatest folly at a time of such financial buoyancy and economic activity, coupled with the red light of labour shortages, to countenance anything but surplus budgeting. However, there is one point in the Treasurer’s Speech on the present expectation of receipts from income tax which I cannot understand. In his reference to revenue and other receipts for this financial year he said -

For a number of reasons this is likely to be a comparatively good revenue year. So far as income tax is levied this year on the incomes of individuals, companies and other businesses derived in 1963-64, it will reflect the generally buoyant conditions of that period. There is perhaps one offset to this worth mentioning. The amount of provisional tax debited last year to taxpayers subject to provisional tax was comparatively large end since in this year it becomes a credit in the assessment of those taxpayers, lt will diminish revenues collected from them.

I repeat -

It will diminish revenues collected from them.

This forecast of a falling off in the rate of increase in the collection of provisional tax in the current year just does not make sense to me. I am prepared to stake what small reputation I have in estimating these matters that far from a decrease in the rate of increase in provisional tax I would expect that in 1964-65 collections should substantially increase. I speak with some feeling on this subject with the normal apprehension of one who realises the impact of the situation where one’s provisional payment falls short at a time of rising income.

A substantial element of provisional tax is derived from those primary producers whose earnings are included in the White Paper on National Income and Expenditure relating to farm income. It will be noted that there has been a sharp increase from £479 million in 1961-62 to £574 million in 1962-63 up to £724 million in 1963-64. As I understand the position, the provisional tax to which the Treasurer refers as being comparatively large and which becomes a credit against the next collection of income tax was based on the actual returns of the year ended 30th June 1963. Since then there has been a sharp increase in what is described as farm income and to me it appears unarguable at this stage that the provisional payments, based on 1962-63 income, will fall a long way short of the payments due on the actual taxable incomes for 1963-64, as the figures in the White Paper support. My guess is that in this section of taxpayers there will be a substantial deficit - not a credit - in the income tax assessed and in the subsequent provisional tax to be calculated. In other words, those people who still have to meet their provisional tax on income earned in the year ended 30th June 1964 will find that they have not paid anything like sufficient provisional tax on the previous year’s income and they will be assessed at the higher rate for 1963-64. My opinion is supported by information I have received that there is a negligible number of tax payers requesting a downward review of their provisional payments. That is an interesting point. In the papers accompanying the Budget Speech the following statement appears -

As regards taxpayers subject to provisional tax, it is estimated that a further substantial increase occurred in 1563-64 in their taxable incomes: These incomes will be assessed to tax in 1964-6s. As a result, a significant increase is expected in collections from this source in 1964-65. The estimated increase over 1.963-64 would be greater but for the large increase in provisional credit (the provisional tax payable in 1963-64 for application against tax assessed on 1963-64 incomes) and the expectation that the reduction in provisional tax by way of self-assessment will be greater in 1964-65 than in


This indicates that the self assessment would leave taxpayers in the position of saying: “ I do not have that income. My provisional tax is assessed too high and I want a refund.” My opinion is supported by information I have received that there is a negligible number of taxpayers requesting a review of their provisional payments. I believe also that the conditions I have outlined as applied to those taxpayers within the farm income group will apply also to taxpayers whose incomes are derived from other sources. I personally would like to think that the Treasurer’s advisers are correct on this subject but my instincts, based on the figures available, lead me to the opposite view. If I am correct it follows that the buoyant receipts from income and provisional tax in the year just concluded will continue at a greater level in the current year, and with any reasonable luck there will be a substantial concealed surplus on this item alone.

In the course of this debate we have heard quite a bit about defence. This is a subject that particularly interests a number of honorable members on this side of the chamber. I was particularly interested in the remarks of some of my colleagues about the adequacy of Australia’s defence effort and also the suggestion that we should now be re-introducing some form of national service training. There seem to be two major considerations in this connection. The first is that the removal of the stability that the colonial powers provided in the South East Asian areas to our north, combined with the expansionist activities of militant Communism, has altered the whole concept of the defence strategies of Australia and New Zealand. Secondly, our defence effort for the time being is not primarily the immediate protection of the Australian mainland and the Territory of Papua and New Guinea. The requirement of our effort is, I believe, to be in a position to undertake our fair share of the responsibilities involved in our treaty arrangements. This does not necessarily mean the full scale re-armament programme which would be involved in making completely adequate protection for our mainland or the best protection that would be within our resources. But the main requisites of mobility and firepower, combined with highly trained personnel up to strength, must be the main features of this force which we would need at the moment. With some knowledge of Australia’s defence effort before World War II - 1 had six years with the Citizen Military Forces before the war - I am convinced that we have never had in peacetime forces of all arms available to us on the same scale as we have today. The facts are that our defence forces - their numbers, their equipment and their tactical capacity for deployment - are infinitely superior to anything we have had in the past. Whether what we have is enough to meet our treaty obligations I cannot say with an informed voice, nor can any one else, because there are so many unknown factors, but I was reassured by the remarks of the Minister for the Army (Dr. Forbes) last week when he said that the Government would re-examine the whole situation if the present recruiting arrangements would not satisfactorily fill requirements of personnel and that under such conditions he would take a second look at the matter of introducing some form of intensive national service training.

This is a very difficult problem. I would not care to express an opinion on the many views that have been given by military advisers about devoting so many regular soldiers to training purposes and therefore weakening our immediate striking force, but if we are not getting the numbers to fill the Australian Regular Army and the Citizen Military Forces obviously a second look will have to be taken at the problem of building up the numbers and stepping up recruiting. However, we will not know what is needed until the present campaign has been thoroughly tried. At the moment it is obvious that withdrawal from our work force of 12,000 or 15,000 young men of 18 or 19 years of age would have a serious effect. It would have a serious effect also on the training of future technicians for our labour force. The honorable member for Sturt (Mr. Wilson) made a good point in his speech. He said that if it is necessary at some future date to re-introduce a selective form of national service training benefits should be given to those who are called up’ to compensate them for the periods they may have lost in their civil life. They could be provided with technical courses or university courses so that they would not suffer in the later struggle to earn a livelihood. That was a good point made by the honorable member for Sturt. I think most honorable members will agree with it. This is something that is done in other parts of the world. 1 close on this note: I know of no country in history that has been able to make a substantial military effort without some form of conscription. We have made substantial military efforts in the past, in time of war, on a volunteer system; but we have never been able to get our numbers up on a volunteer system in time of peace. That is history. There is no avoiding that fact. If we want a substantial effort, particularly in the Army, it must be based on conscription. I reject entirely the frivolous amendment produced by the Leader of the Opposition. I support the Budget. I believe that it will contribute to Australia’s progress and strength. It is not spectacular progress, but it is sound.

Debate (on motion by Mr. Stewart) adjourned.

page 664


Telephone Services - Australian Army - Television

Motion (by Mr. Freeth) proposed -

That the House do now adjourn.

West Sydney

– This afternoon I received by special delivery a letter from a constituent of mine in Sydney. It relates to telephone problems. The letter is from Henry & Egan Pty. Ltd., manufacturers of “ Hega “ hats, agents and importers. The letter reads as follows -

Dear Sir,

We wish to bring to your notice the following and request your assistance in rectifying the matter if possible.

Recently our factory at 38 Smith Street, Surry Hills, was damaged as a result of a fire in the building and we were forced to make arrangements to transfer our manufacturing to other premises. Finally we obtained suitable space on the 7th floor of 49-53 Wentworth Avenue, Sydney. The removal of our factory from Smith Street includes the removal also of our offices and showrooms at 73 York Street, Sydney, in the very Bear future.

For a number of years we have always endeavoured to do as much export trade as was possible in our type of business. We were the only manufacturer of millinery in Australia who took space and displayed at the recent Osaka Trade Fair. We supplied goods to such firms as Robinsons & Co. Limited of Singapore, and the Isetan Company of Tokyo for their individual “AUSTRALIAN MADE “ promotions. In each case these goods have been supplied at a loss which we have written off as an item that in some small way has helped Australia’s export drive. We would like to continue these efforts if possible. Our Mr. R. Henry is a Councillor of the Apparel Section of the Chamber of Manufacturers (N.S.W.) and as such is the only Representative on the Council for the whole of the Ladies and Men’s hat trade in N.S.W. Mr. Henry is well known to Mr. Temby and various other officers of the Department of Trade. We are members of the Chamber of Manufactures of N.S.W. “Export Division”.

Some weeks ago we made application to the G.P.O. for removal of our telephone service MA 3054 from 38 Smith Street, to the 7th floor of 49-53 Wentworth Avenue, approximately 400 yards distant. We also applied for one additional service plus some internal extensions. Since then we have called a number of times at the G.P.O. about the removal and new service, and have been told several different reasons why the removal is delayed and several indefinite delay periods ranging up to twelve months. The position now is that we are trying to operate a manufacturing business in the heart of Sydney without a telephone service.

The position is such that we are facing a loss of staff, a loss of business, a situation where either for our own business or as a representative of the industry, we cannot be contacted by telephone, and telephone communication with other countries is not possible. Visiting buyers either from overseas or from within Australia cannot contact us for appointments by telephone.

Mr Hughes:

– It is a long letter.


– You would write a long letter, too, if you were in the same predicament. The letter continues -

We have just received a further order from Singapore which is the result of a great deal of effort on our part in the past. Such orders in the future without the use of telephone will have to be refused. We have received communications from the Department of Trade recently offering us space in the coming Tokyo Trade Fair and other promotions. These will all have to be refused.

We respectfully request that you do all possible to have this rectified at a very early date.

I hope and trust that the people responsible for raising the telephone rentals will do something about this matter. The gentleman concerned had to put a ls. 8d. stamp on the letter that he sent to me this afternoon. I hope that the Government will take heed of his request. In the last two or three months I have been doing what might be called the honorable thing. I have been ringing up and writing about the matter, but it is going too far when people are unable to obtain a telephone until three or four months have elapsed. I sincerely hope that the postal authorities will get in touch with the company to which I have referred and do the right thing. I hope that tomorrow the Postal Department will tell the company that a telephone will be made available. It is a disgrace that the Government should treat people in this way.

Minister for the Army · Barker · LP

Mr. Deputy -Speaker, I wish to take this opportunity to correct a statement that I made in the Budget debate last Thursday.

Mr Peters:

– You should correct all the mistakes you have made.


– I am about to correct the only mistake I made. In referring to the introduction of a selective service scheme based on an intake of 15,000 national servicemen a year for two years’ service, I stated that the cost of such a scheme during the first five years would be of the order of £247 million. I then went on to say -

The cost of the scheme would level out at an additional cost of £117 million a year.

As will have been apparent to anyone who knows anything about these matters, this was a slip of the tongue on my part. The word “additional” should not have been used. The figure of £117 million was. of course, meant to be the total Army vote, if such a selective service scheme were introduced. It was based on last years’ Army vote of £77 million. The cost of such a scheme, after it reached fruition, would therefore be approximately £40 million a year.


– I notice that the Postmaster-General (Mr. Hulme) is in the House at the moment, and the remarks I have to make will be addressed to him because they concern telecasting times. In recent months in Sydney there has been a curtailment of telecasting during the week. I have had numerous complaints made to me, including some from patients in hospitals, about the curtailment of telecasting times. On Monday to Friday telecasting starts at about 1.30 in the afternoon. There are some exceptions such as when there is an early morning telecast of an educational nature. This curtailment affects retired people and sick people, expecially those in hospitals who are not normally allowed to sit up at night to look at television programmes. It also affects housewives. They complain that no programmes are now available for them to watch at the time when they would normally sit down and relax while having their lunch. Formerly they were able to watch entertaining and popular programmes. They may not have been of the type that we would find interesting, but I understand that hosts of womenfolk have been very disappointed to find that the programmes are no longer shown during the middle of the day.

Mr Chipp:

– What sort of programmes were they?


– The Tommy Hanlon series and that sort of thing. They are quite entertaining programmes of a light nature. Frankly, I am surprised that the commercial stations have not seized the opportunity to show programmes to this apparently sizeable viewing audience, which is available at this time of day. Whatever power the Postmaster-General may have over television stations, I hope that he will bring to the notice of the commercial stations and the national station that their curtailment of programmes has left an unsatisfied viewing audience of considerable size.

I do not think I need say much more than that. The point is that all three Sydney stations, with the exception of the early morning programmes, commence transmission at the one uniform time of 1.30 p.m. If the stations do not intend to lengthen the time that they are transmitting programmes, they could at least stagger the times at which they commence transmission. One station could commence at, say, 10.30 a.m. or 11 a.m. and provide programmes that formerly were much appreciated by quite a considerable number of people. Perhaps the stations are not aware of the number of people who have been disappointed by the curtailment of programmes. I will be glad if the Postmaster-

General will take this matter up with the television stations.

Question resolved in the affirmative. House adjourned at 11.22 p.m.

page 666


The following answers to questions were circulated -

Shipping and Transport. (Question No. 96.)

Mr Hayden:

n asked the Minister for Shipping and Transport, upon notice -

  1. In which ports has the Australian National Line transacted business with the Fleetways Transport Co. in each of the past five years?
  2. What percentage of the total business transacted between the Australian National Line and road transport companies in each of those ports in each of those years has been handled by the Fleetways Transport Co?
Mr Freeth:

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

  1. During the past five years the Australian National Line has transacted business with Fleetways Transport and Agency Pty, Ltd. at Melbourne and during the past four years with Rail Ferry Services Pty. Ltd., which is a subsidiary of the Fleetways organisation at Melbourne, Bell Bay, Burnie and Devonport.
  2. The Australian National Line carries cargo for Fleetways Transport and Agency Pty. Ltd. and Rail Ferry Services Pty. Ltd., and has business dealings with the former company in respect of the cartage of stores, the hire of cranes, &c. It is not possible to distinguish readily from the information available at the Australian National Line the commercial freights paid by road transport operators only. The bulk of the cargo carried for the Fleetways organisation is in the Searoad Service between Melbourne and Tasmanian ports. The booking of space and the collection of freight is conducted by agents of the Line in accordance with the Australian Coastal Shipping Agreement. The freight covering shipments by Fleetways Transport and Agency Pty. Ltd. and Rail Ferry Services Pty. Ltd., and the percentage it bears to the total commercial freight for the service in the various years is as follows -

As regards other commercial dealings between the Australian National Line and Fleetways Transport and Agency Pty. Ltd., the following table indicates the payments made to Fleetways Transport and Agency Ply. Ltd. and the percentage which it represents of the total transactions of this nature (other than freights) which the Australian National Line has conduced throughout Australia with other road transport companies during the periods indicated. The dissection of total business transacted between the Australian National Line and the road transport companies as between ports is not practicable -

Oil. (Question No. 129.)

Mr Beaton:

n asked the Minister for National Development, upon notice -

  1. In order to protect Australian investment, both Government and private, will the Government legislate to ensure the use of a fixed percentage of Australian produced crude oil by local refineries?
  2. Is it a fact that crude oil produced at the Moonie field is of superior quality to the major proportion of crude oil imported into Australia for refining?
Mr Fairbairn:

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

  1. As I said in an answer to a previous question, the Government hopes that hereafter Australian produced commercial crude oil will be taken up by Australian refineries on a satisfactory commercial basis without any need for Govern ment intervention. However, the Government has under examination the possible procedures that could be adopted, if necessary, to ensure this.
  2. Yes, but quality is not the only factor affecting the price a particular refinery can be expected to pay for a crude.

Housing. (Question No. 456.)

Mr Whitlam:

m asked the Minister for Housing, upon notice - il. How many houses have been (a) sold and (b) let by each State housing authority under the successive agreements between the Commonwealth and the States? (2. How many applications were (a) lodged in the last financial year and (b) outstanding at the 30th June last with each authority (i) to purchase and (ii) to rent houses erected under the agreements?

  1. How many applications were (a) lodged in the last financial year and (b) outstanding at the 30th June last with building societies in each State (i) to purchase and (ii) to build houses with loans under the agreements?
  2. How many applications from serving members of the Forces were (a) lodged in the last financial year and (b) outstanding at the 30th June last in each State?
  3. What amounts (a) were advanced in the last financial year and (b) will be advanced in this financial year to each State for (i) the State housing authority, (ii) building societies and (iii) serving members of the Forces?
  4. How many houses were (a) commenced and (b) completed in the last financial year in each State in each category?
  5. What payments of interest and repayments of principal were made by the States in the last financial year and are expected to be made by them in this financial year?
  6. How many tenants were receiving rentalrebates at the 30th June last under the 1945 Commonwealth and State Housing Agreement in each Slate which is a party to the agreement, and what was the total cost of rental rebates in the last financial year in each of these States?
Mr Bury:

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

  1. The number of houses sold and let under the Commonwealth-Slate Housing Agreements by each State housing authority to 30th June 1964, was -
  1. The following figures include applications lodged for Housing Agreement homes and also for other dwellings -__
  1. It is not the practice of most building societies to record all applications.
  2. Advances under the Commonwealth-State Housing Agreement in 1963-64 and the amounts expected to be advanced in 1964-65 are -
  1. The number of dwellings commenced and completed in 1963-64 under the Commonwealth State Housing Agreement were -
  1. Applications for married quarters from serving members of the forces were -
  2. Repayments of principal and payments of interest under the Commonwealth-Stale Housing Agreement in 1963-64 were -

Note. - Tasmania withdrew from the 1945 Agreement during 1950-51. South Australia does not operate under the rebate formula laid down in the Agreement. However, it does operate its own rebate scheme.

Aids to Teaching. (Question No. 342.)

Mr Reynolds:

s asked the Prime Minister, upon notice -

  1. Did the recent conference of the Australian Science Teachers Association direct attention to the importance of new developments in audiovisual aids in teaching?
  2. Is he able to say whether other countries, particularly the United States of America, have carried out much research into “ teaching machines” for use in schools, universities, the armed services and industry?
  3. Is it a fact that comparatively little of this type of research has been carried out in Australia?
  4. What research of this kind has been undertaken in recent times by the Commonwealth Office of Education?
  5. Will the Government give consideration to a comprehensive research programme in this field through this agency for the benefit of all educational bodies in Australia?
Sir Robert Menzies:

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

  1. I have not seen any documents regarding the views of the Australian Science Teachers Association on this point although I am informed that at its recent Conference, the Association did emphasise its interest in these matters.
  2. It is true that a good deal of research, not all of equal quality, has been done in the United States in recent years in the development of “ teaching machines “ and “ programmed instruction “ in the fields mentioned. I understand that some experimentation is also proceeding in Britain with such teaching devices in schools.
  3. The amount of activity in this field in Australia ,has certainly been much less than in the United States. However, the Australian Council for Educational Research is acting as a clearing house for information on developments taking place and has published documents for the guidance of other educational authorities.
  4. The Commonwealth Office of Education at its English Teaching Centre has a language laboratory in regular use for the teaching of English to certain sponsored students from overseas. Machines are used there for individual instruction, and teaching materials are being developed especially for use with the machines.
  5. The Office of Education will continue to keep in touch with developments and research work in this field.

Transport. (Question No. 344.)

Mr Webb:

b asked the Prime Minister, upon notice -

  1. Is he able to say whether the Federal Parliamentary Labour Party Committee on Rail Standardisation recommended the selling up of a federal body to be known as the Australian Interstate Commerce Commission, with power to control all types of interstate transport, to fix rates and charges and to control conditions of carriage?
  2. Did the Joint Committee on Constitutional Review recommend the setting up of an Interstate Commission?
  3. Does section 101 of the Constitution provide for the establishment of an interstate commission?
  4. If the position is as stated, will he give consideration to the setting up of an Interstate Commission?
Sir Robert Menzies:

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

  1. to 3. Yes. 4, The Government has no plans for constituting such a commission.

Pensions. (Question No. 381.)

Mr L R Johnson:

son asked the Minister for Social Services, upon notice -

  1. Which countries pay retirement pensions to their nationals and former nationals now residing in Australia?
  2. Has any investigation been undertaken to aascertain whether there is any possibility of paying Australian age, invalid and widow pensions to pensioners who choose to live in the United States of America?
  3. If so, what insurmountable difficulties have been encountered?
Mr Roberton:
Minister for Social Services · RIVERINA, NEW SOUTH WALES · CP

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

  1. Precise information on which to base a reply ls not available. It is known, however, that many countries with national insurance schemes, such as the United Kingdom, Italy, the Netherlands and Greece, pay pensions to their nationals irrespective of the country in which they elect to reside. 2 and 3. Commonwealth age, invalid and widows’ pensions are not payable outside Australia except for periods of temporary residence in countries wilh which Australia has reciprocal agreements, i.e. the United Kingdom and New Zealand. The considerations which led to the Australian agreements with the United Kingdom and New Zealand have little, if any, applicability to the United States of America. The volume of migration between Australia and the United States is not considerable and, at this stage, would scarcely warrant an approach to the United States Government for an agreement on social security. Moreover, the structure of the United States’ pension scheme is such that a basis for reciprocity would be difficult to find, even if the United Slates were prepared to enter into an agreement of this nature.

Social Services. (Question No. 404.)

Mr L R Johnson:

son asked the Minister for Social Services, upon notice -

  1. Is a pensioner eligible to receive funeral benefit in respect of the funeral of his wife who before her death was the recipient of a wife’s allowance?
  2. Is it conceded that such an applicant is more likely to be in necessitous circumstances than a pensioner applicant whose spouse was a pensioner receiving the pension at the maximum rate?
Mr Roberton:

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

  1. No.
  2. A funeral benefit is payable to a qualified applicant irrespective of his means.

Taxation. (Question No. 349.)

Mr Webb:

b asked the Treasurer, upon notice -

  1. Is he able to say whether the British Government is now operating a capital gains tax in order to deal with speculative gains?
  2. Are similar speculative gains available to speculators, free of tax, in Australia?
  3. Will he consider introducing legislation for a similar form of tax?
Mr Harold Holt:

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

  1. In 1962 the United Kingdom Government introduced provisions to impose income tax on gains arising from the disposal of certain assets within a short period of their acquisition. They are still operative.
  2. Speculative gains are subject to income tax under our income tax law if they arose in the course of carrying on a business involving speculative buying and selling. Profit arising from the sale of property acquired for the purpose of profitmaking by sale is also taxable. Profits arising from the carrying on of any profitmaking undertaking or scheme are also subject to income tax under our law.
  3. It ls the practice of the Government to keep under review all appropriate methods of meeting its budgetary requirement.

Cite as: Australia, House of Representatives, Debates, 26 August 1964, viewed 22 October 2017, <>.