House of Representatives
28 April 1966

25th Parliament · 1st Session

Mr. SPEAKER (Hon. Sir John McLeay) took the chair at 10.30 a.m., and read prayers.

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Mr. GILES presented a petition from certain electors of the Division of Angas praying that immediate steps be taken for the purpose of providing satisfactory television reception in the Upper Murray and Murray.Mallee areas of South Australia.

Petition received and read.

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– Can the Minister for National Development say when he will answer question No. 1593 of which notice was given by the honorable member for Stirling on 16th March? In view of the importance to northern development of the matters raised in the question, will the Minister treat it as urgent?

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

– 1 have already told the honorable member for Stirling that I will give him a reply at the earliest possible moment. I point out that a considerable amount of work has to be done in this matter. There were some 50 recommendations and these are being looked at very carefully by the Government. As soon as we are in a position to make a statement we will do so.

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– 1 wish to ask the Minister for the Navy a question. Has his attention been directed to a recent statement that the United States Navy is seeking a replacement for the Grumman Tracker S2 as a carrier-based anti-submarine aircraft because it is now obsolete? As the Australian Government has placed an order for this type of aircraft, can the Minister say whether the statement to which I have referred is correct?

Minister for the Navy · PERTH, WESTERN AUSTRALIA · LP

– The statement that the United States Navy is seeking a replacement could be correct because I think the United States Navy and the United States Air Force are constantly planning for the replacement of ali / pes of aircraft. 1 understand that at present one anti-submarine aircraft is on the drawing board. Honorable members know what that means in terms of the time that will be taken in getting that aircraft into service. In any event, the type that is envisaged would not be suitable for H.M.A.S. “Melbourne”. As honorable members are aware, the Commonwealth Government ordered 14 of these Tracker aircraft. They are far from obsolete. They are at present in service wilh the United States Navy and will be for some time, and they are still considered to be the most suitable aircraft to form the anti-submarine force of the Australian Fleet.

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– My question is directed to the Minister for Territories. I ask: Are hides and slaughtered meat from th? New Guinea Highlands allowed into Australia? Are these commodities disease free? Is there at present a surplus of beef cattle in New Guinea and would the entry of hides and slaughtered meat into Australia help both countries?

Minister for Territories · MCPHERSON, QUEENSLAND · CP

– There is no quarantine ban on the entry of hides into Australia. We have had no occasion to admit slaughtered beef. However, I imagine that this also would be permitted under conditions similar to those applying to hides, lt may be of interest to the honorable member to know that hides could be a New Guinea export of considerable significance. Early this month, the new Lae abattoir was opened. It has a capacity of about 300 head of cattle a week. We do not expect that it will be working at full capacity for some time, but we believe that we shall probably have a kill of 2,000 to 3,000 head of cattle each year. With respect to the export of beef from New Guinea, indications are that there will be an ample local market within the Territory. I would add also that on a recent trip to New Guinea I was particularly impressed by the standard of cattle, especially in the Western Highlands. The problem there was access to a market, of course. The opening of the Lae abattoir represents a great step forward and will give a great impetus to the cattle industry in the Territory.

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– My question is addressed to the Minister for External Affairs. Does Article IV of the South East Asia Collective Defence Treaty, in effect, state that each party recognises that action to meet aggression by means of armed attack in the Treaty area will be undertaken in accordance with the constitutional processes of each member country and that “ measures taken…….. shall be immediately reported to the Security Council of the United Nations “? In the light of recent misleading public statements, I ask: Did Australia take her action with respect to Vietnam in accordance with her constitutional processes? Did she in fact immediately report her action to the Security Council? In so acting, did she fulfil, in letter and spirit, all the obligations and responsibilities imposed on her by the South East Asia Treaty Organisation?

Minister for External Affairs · CURTIN, WESTERN AUSTRALIA · LP

– The answer to each of the three questions asked by the honorable gentleman is “ Yes “. These answers have been given repeatedly in this House in response to questions, both upon notice and without notice, at least two of them having been asked by the honorable member for Yarra. In order that there shall be no mistake about this, I refer honorable members to the answers given on 16th October 1964 to questions Nos. 395 and 408 upon notice, to a statement made by the former Prime Minister on 24th May 1965, to a further statement made by him on 19th August 1965 anr! to th« answer given by me to question No. 1112 upon notice on 30th September 1965. As one of the matters that has been called into question is the form of our notification to the Security Council. I ask your permission, Mr. Speaker, to recite the terms of our notification to the Security Council.

Mr Calwell:

– Are they lengthy?


– No. They will take only two sentences. The terms of our reply were -

I have the honour to inform you -

This is the President of the Security Council - that the Australian Government has decided to despatch forces to South Vietnam in order to assist in securing its defence against hostile activities, including armed attacks, which have been sup ported, organised and directed by North Vietnam.

This decision has been made at the request of the Government of the Republic of Vietnam and it is in accordance with Australia’s International obligations.

A month subsequent to that at the S.E.A.T.O. Council meeting in London the Council, in an agreed communique, stated as follows -

The Council recalled that its members also agreed at Manila that they should r “main prepared, if necessary, to take further eoi :rete steps within their respective capabilities in fulfilment of their obligations under the Treaty.

That is the S.E.A.T.O. treaty. The statement continued -

Pursuant thereto, substantial assistance and reinforcement have been given during the past year by certain member governments -

I say specifically that among those member governments was Australia - in order to assist South Vietnam in resisting aggression from the North. The member governments -

And they include Australia - agreed to continue and, consistent with their commitments elsewhere, to increase their assistance to South Vietnam.

That information is quite clear and specific. It is already in possession of honorable members. It is already well known to the honorable member for Yarra who persists in talking on this subject because that particular information was contained in an answer to a question on notice asked by him.


– I desire to ask the Minister for External Affairs: Is it not a fact that South Vietnam, or Vietnam as he prefers to call it, is not a signatory to the pact relating to the South East Asia Treaty Organisation? If this is a fact, then how does Australia come to be involved in South Vietnam? Under what obligations are we involved? If there are no obligations under S.E.A.T.O. - and there are certainly none under A.N.Z.U.S. - why are we fighting in somebody else’s country?


– I have pleasure in informing the honorable gentleman that South Vietnam is named as one of the protocol States. The purpose of naming certain States as protocol States was to indicate that those were the States most likely to be in need of assistance under S.E.A.T.O.

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– I ask the Minister for the Interior: Has the Government made an offer to sell Garden Island, Western Australia, to the Government of that State? If so, what was the result of the negotiations between the Commonwealth and the State Government? If the Commonwealth is to retain the Island, for what purpose is it intended to be used?

Minister for the Interior · RICHMOND, NEW SOUTH WALES · CP

– Some three or four years ago, a large portion of Garden Island was offered to the State Government of Western Australia. The Commonwealth Government put a valuation on the land. The State Government rejected the valuation and negotiations were held in order that the land might be offered as a reserve for parkland. Negotiations continued for some time and while they were in progress the Navy informed my Department that it felt that it had a further use for the land, so the offer was withdrawn.

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– I direct my question to the Minister for Health. In view of the relatively high cost of Australian health services and the disparity of hospital standards, will the Minister say whether or not the Government intends to support proposals for a regional hospital system? Considering the obvious advantages of this system, will the Minister convene a conference of State Health Ministers to formulate a basis for Commonwealth cooperation and support for its implementation and the introduction of salaried specialist services? Has such a system been recommended by the New South Wales Starr Committee and is it to be implemented on a pilot basis in the Riverina?

Minister for Health · BARKER, SOUTH AUSTRALIA · LP

– The honorable gentleman addresses to me a question that relates to matters which are, clearly, wholly within the province of State Governments. I therefore do not believe it requires an answer from me, except insofar as it affects our responsibilities in the Australian Capital Territory and the Northern Territory.

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– My question is addressed to the Treasurer. Has his attention been drawn to the case relating to sales tax submitted by the soap and allied manufacturers, who say that a signal service to the whole community would be rendered by the removal of sales tax, which is unjust and discriminatory? Will he give sympathetic consideration when preparing the Budget to removing the sales tax on soaps, dentrifices and detergents?


– 1 have received various recommendations for the cancellation of taxation on items such as those mentioned by the honorable gentleman. At least 20 recommendations have been made to me in the short space of six weeks. Whilst I cannot give an undertaking that sales tax will be removed from the items he mentioned, I can assure him that his suggestion will be considered together with all the other recommendations that are made during the course of Budget discussions.

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– I direct a question to the Minister for Trade and Industry. Are steel makers in Australia curtailing the production of various types of sheet steel and sections? Has this reduced production resulted in increased unemployment in Newcastle and Port Kembla and a serious loss of confidence in the future of the Australian steel industry? Has this state of affairs been brought about because of substantial and uncontrolled imports of motor vehicles and of iron and steel? Has Government assistance been sought for this important basic Australian secondary industry? When was the request received? Has the Government taken any action? When can we expect a decision? Where will the steel rails come from for the construction of the new Hamersley, Mount Newman and other Western Australian iron ore railways?

Minister for Trade and Industry · MURRAY, VICTORIA · CP

– As the question requires a series of answers, I will procure the information in detail for the honorable member.

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– My question is addressed to the Minister for External Affairs. Has the

Minister seen a reference to a report in the Indonesian Press to the effect that it was the Chinese Communist Party that instigated the October coup in Indonesia last year? Has the Minister information at this stage that would show whether this is correct.


– There are various points of information which, added together, would certainly give credence to the statement that the honorable gentleman has quoted. First, we have the undoubted fact that a great number of people in Indonesia firmly believe that the Chinese were implicated in promoting the October coup. They believe this so firmly that they have taken action against the Chinese Embassy and have demonstrated in other ways their animosity towards the Chinese for interfering in the domestic affairs of Indonesia.

Mr Calwell:

– And murdered 200,000 of their compatriots.


– I think that is another part of the whole situation and does not refer to the particular question that the honorable gentleman has asked. The second set of information concerns the statements made in Peking itself. Peking, by the statement it has made over its radio and in its other forms of propaganda, has made clear, first, that it firmly supported the Indonesian Communist Party. Secondly, it has also made it clear that it disapproved of those who took action to defeat the coup. It has broadcast most vehemently and vitupera.tively against the people who prevented the coup in October from being successful. Thirdly, we have, from diplomatic sources, reports that seem to indicate that in Peking the prospective coup was known about some time before it actually happened. Furthermore, we have more recent evidence that, the present Government of Indonesia having decided to recall from Peking the Ambassador appointed by the previous government, that Ambassador refused to return to Indonesia and has chosen to remain in Peking, where he is at present engaged in international propaganda activity on behalf of international Communism. Then we have information of a less definite kind, but information that has some credibility, that there was direct participation of Chinese sponsored forces in supplying both the means and the instruments of rebellion to those who were trying to promote the coup.

Dr J F Cairns:

– They must have been very unsuccessful.


– Well, China fortunately - and I am sure that this will cause dismay to the honorable member who interjected - has been notably unsuccessful throughout the past year. China has been unsuccessful in Africa. I do not want to cause anguish to the honorable member, but he has expressed something that shows his dismay that China has been unsuccessful. China has been notably unsuccessful on the frontiers of India, in Africa, in Indonesia and in several other places. As far as I am concerned, and as far as the Government is concerned, this is a cause of satisfaction. We believe that this is something that adds to the security of Asia and gives hope to the people of Asia, but if the honorable gentleman takes a different view that is something that I can well understand. China has been unsuccessful, and notably unsuccessful, on these occasions. But to cut short what I have to say, the broad answer to the question asked by the honorable gentleman is that there is information which indicates that China, through its longstanding links with the Indonesian Communist Party, did have some part in promoting the attempted coup in Indonesia last October and that China has suffered a notable failure by the defeat of that coup.

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– Does the Minister for Labour and National Service know that it is alleged that the medical examination conducted for entry into national service training is not as severe as that demanded by the Australian Regular Army? Does this explain why some applicants for enlistment in the Australian Regular Army are rejected and yet are accepted for national service training? Perhaps I will be permitted to say that up to the last few weeks the eye test in particular in South Australia was entirely different for the two arms of the Service. [ therefore ask the Minister: Will he confer with the Minister for the Army with a view to bringing about a uniform medical examination, as both national service trainees and Regular Army soldiers will be expected to fight together and should be as least as fit as one another?

Minister for Labour and National Service · WENTWORTH, NEW SOUTH WALES · LP

– The medical standards applied by the national service organisation within my Department are precisely the same as those applied by the Army. The standards are laid down by the Army and we carry them out on behalf of the Army. It is always possible, of course, that someone who is medically fit at one moment will not be fit at another, and vice versa. Quite a large number of cases have to be deferred temporarily for further examination, and it does happen in some cases that some trainees, having passed through the national service organisation medical examination, prove to be not suitable on arrival in the Army when they are further tested. Nevertheless the tests that are applied by my Department are those laid down by the Army.

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– I address a question to the Minister for Primary Industry. Did the Australian Wool Board in its report for the year 1963-64 state that the International Wool Secretariat believed that every effort should be made to provide the wool growing industry and the Commonwealth Government with improved forms of measurement of the results of the expenditure of Secretariat funds on its promotion campaigns? Did the Secretariat direct its economics department to give close attention to improvement in techniques for measuring this effectiveness in detail? Is the Minister aware of any progress in this regard and is he aware that a section of the industry is complaining that the results most apparent to the producer are a general lowering of the price of his product since that date and, also since that date, an increase in the levy for promotion and research?

Minister for Primary Industry · FISHER, QUEENSLAND · CP

– The annual report of the Wool Board did state that the economics department of the International Wool Secretariat was directed to give close attention to measuring the effectiveness of the expanded promotion campaign which the Secretariat had initiated. The International Wool Secretariat has followed this up, but the technical problems involved are formidable. However, Mr. Vines, the Managing Director of the Secretariat, who was out here last October, submitted a first progress report to the Wool Industry Conference, and

I understand that another report is now ready and will be discussed by the International Wool Secretariat at its next meeting to be held in London in June, lt is the intention of the Secretariat to provide an annual report on the subject.

I cannot quite follow the honorable member in his reference to a general lowering of prices, unless he refers to the position of the industry after 1963-64. In 1964-65, there was a general lowering of prices, but when we look at the position for the current year we see that there has been a firming of prices. Perhaps the expanded promotion campaign which was initiated only in 1964-65 is beginning to have some good effects because the average price this year is higher than for the corresponding period last year and prices are continuing to firm. The honorable member mentioned an increased levy. The levy is calculated on a percentage basis of gross proceeds and a lowering of prices would result in a smaller amount being paid for promotion. A firming of the price would naturally result in an increase in the proceeds for promotion. As far as research is concerned, let me say that the Wool Board is now investigating every aspect of research with a view to making recommendations and having discussions with the Wool Industry Conference concerning the next five year plan on research. The industry will be kept fully informed on that investigation.

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– I ask the Minister for External Affairs a question. Is the process whereby the Australian National University trains technicians from India in the John Curtin School of Medical Research sponsored by his Department? If so, has any consideration been given to extending this valuable service into other fields and other institutions in view of India’s tremendous need for technicians?


– I am aware that my Department has some part in this activity, but I should like to have the opportunity of checking on the details so that I may give the honorable gentleman a fuller and more useful answer.

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– My question is addressed to the Minister for Shipping and

Transport. Is it a fact that the number of persons killed on Australian roads annually is close to the number of men comprising the three infantry battalions in a military brigade, and that almost 70,000 are casualties of such accidents each year in addition to those killed? Is the honorable gentleman aware that there has been much discussion and some action in the United States in recent months at the Federal level in respect of one factor, namely, the safer design of passenger cars, for example, in regard to safe locking doors, collapsible steering columns, padded dashboards, shatter proof glass, and the anchorages for safety belts? Does the Commonwealth Government in this country have any constitutional power in this field in respect at least of vehicles moving interstate? Does it have any persuasive powers through the Department of Trade and Industry, or are other steps possible or in contemplation to deal with this factor in road accidents?

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

– It is a fact that the number of road deaths in Australia approaches 3,000 each year. As regards safety measures in vehicles, which was the matter referred to in the last part of the honorable member’s question, there is a subcommittee of the Australian Road Safety Council, which comprises representatives from the various States, examining this aspect of vehicle design. So far as the Commonwealth’s constitutional powers are concerned, if it has any they would be extremely limited.

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Dr J F Cairns:

– I ask a question of the Minister for External Affairs. I preface it by referring to his answer to a question a few minutes ago in which he suggested that I was disappointed at the failures of the Chinese in their adventures on the Indian frontier, in Africa and in Indonesia. I ask: Can the Minister produce any evidence whatever to substantiate his offensive and insulting implication? Is he aware that I welcome the result in the places that he has mentioned because it will discourage the Chinese from the use of their hard aggressive line and it will make it less possible for his Government thoroughly to contaminate Australia’s international relations by overstressing, as it does con tinuously, the threat that China represents to this country?


– I am sure that the House appreciates the clarification of the honorable gentleman’s attitude towards China. My statements were based, first, on his demeanour when interjecting, and, secondly, on the repeated attitude he has expressed on public platforms throughout this country. As the honorable gentleman has clarified his attitude towards China, perhaps I should clarify the Government’s attitude towards China. We know quite well that China is the dominating factor in the whole Asian situation. We have said repeatedly in this House in carefully prepared statements that there can be no peace in Asia until we find the terms on which we can live alongside China. The point on which I think we differ from some honorable members opposite is this: That in the present circumstances we believe that allowing China to succeed in aggressive policies is going to be a very bad prelude to getting just, reasonable and lasting terms of co-existence with her. So we say that it is necessary to ensure that not only in the three places that have been mentioned but in other places where Chinese Communist aggressive activity appears it shall be made to fail, and we will continue with that policy of trying to ensure that Chinese Communist aggressive activity does fail wherever it appears. We now look with rather more confidence than we had before to the honorable member for Yarra helping us to see that it does fail.

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– Is the PostmasterGeneral aware that although there are three television stations in north western Victoria there are still places in that area where the television reception is poor indeed? Will the Minister make investigations with a view to ascertaining whether it would be practicable to establish a translator service from the national television station at Swan Hill to serve the HopetounJeparitRainbowBeulah area?

Postmaster-General · PETRIE, QUEENSLAND · LP

– Victoria is better served with television than any other State. In fact, there are many places in Australia where the priority is higher than for one of the two places in Victoria to which he referred.

Very few translators are being or have been approved in relation to the national network until such time as we carry through to the end of Stage 4. The question of additional translators associated with the national network will be looked at from time to time, but particularly at the conclusion of that stage.

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– I ask the Minister for External Affairs a question. Is the position concerning Vietnam and the South East Asia Treaty Organisation the same as he told the honorable member for Yarra on 20th October 1964, namely-

The Government of the Republic of Vietnam has not made any particular request to S.E.A.T.O. collectively to take action on its behalf. It has addressed various appeals from -time to time to both S.E.A.T.O. and non S.E.A.T.O. members.

Is the position also still the same as he told me on the same day, namely -

In the absence of a specific approach from the Government of the Republic of Vietnam invoking paragraph 1 of Article IV of the Treaty, the question of a report to the Security Council has not arisen.

If the right honorable gentleman claims that the Government’s action in Vietnam is justified or required by its S.E.A.T.O. obligations, why has the Government not cited S.E.A.T.O. in the notification to the Security Council, and why has the Government not sought the authorisation of the Security Council to take enforcement action under this regional arrangement, as is required by the United Nations Charter?


– The answer to the first part of the question asked by the honorable gentleman is “ Yes “. The answer to the second part of his question is that we quoted our international obligations comprehensively

Dr J F Cairns:

– The Minister is dodging it.


– I am not dodging it at all. We quoted comprehensively our international obligations in notifying the Security Council and our international obligations include those under S.E.A.T.O. and those under the United Nations Charter.

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– I direct a question to the Minister for External Affairs. In view of the question asked by the Leader of the Opposition earlier this morning, is the House to assume that the Government has failed to make available to the Leader of the Opposition, who is the leader of the alternative government of Australia, a copy of the South East Asia Treaty Organisation treaty and its protocol? The latter reads, inter alia -

Designations of States and territories as to which provisions of Article IV and Article III are to be applicable. The parties unanimously designate for the purposes of Article IV -

And this was quoted by the honorable member for Evans - the free territory under the jurisdiction of tha State of Vietnam.

I suggest also that the Minister consider supplying the Leader of the Opposition with a copy of the Treaty and also a copy of the very powerful article, written by a well known academic, which is published in today’s issue of the “ Canberra Times “.


– If the honorable gentleman has not yet received copies of these documents I would be very glad to supply them to him.

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– I ask the Minister for Defence a question. Are persons with convictions for summary offences not wanted for service in the armed forces? Do these conditions apply to national service trainees? If not, why not? Have more than 45,000 persons been rejected for military service in the past five or six years? If so, will the Minister say how many have been rejected not on medical grounds but because they had police records or did not measure up to the educational standards required? Do these rejections reflect the Government’s inability to obtain sufficient volunteers for the Regular Army? To what extent has this situation influenced the Government in deciding to send national service trainees to Vietnam?

Minister for Defence · PATERSON, NEW SOUTH WALES · LP

– The matters raised by the honorable member in his question are more applicable to the responsibilities of my colleague, the Minister for Labour and National Service. The police records of personsenlisting are investigated individually. Clearly, convictions for petty offences will not affect the entitlement of a person to enlist. On the other hand, convictions for major crimes would be a cause for rejection.

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Sir Wilfrid Kent Hughes:

-I ask the Minister for External Affairs a question. In view of the Government’s decision to approve an exchange of diplomatic representatives with Yugoslavia, a European Communist nation, when does the Government propose to appoint a diplomatic representative to Taiwan - the Republic of China - a friendly Asian country, which for many years has had an ambassador in Australia? Why is Taiwan - our only Asian ally - singled out for this peculiar treatment of refusing to appoint an Australian diplomatic representative?


– As the honorable gentleman knows, we are constantly reviewing the state of our diplomatic representation abroad and trying to balance the very great need for expanding it with our limited capacity. I appreciate fully what the honorable gentleman has in mind in asking his question. All I can do is assure him that the points he has raised will receive urgent consideration.

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– I ask the PostmasterGeneral a question. Does the Australian Broadcasting Control Board submit regular reports to him on the operation of companies holding television licences? If so. do the reports include details of the financial status of the companies? Is the Minister aware of any licence holder being in financial difficulties? If so. what action is being taken to ensure that the station concerned will continue to operate? Is any consideration being given to requesting the Australian Broadcasting Commission to operate a commercial station should the company holding the licence find it impossible to continue?


– The answer to the last part of the honorable members question is: No. Television station licences are applied for on a commercial basis by private individuals. Their ability to remain solvent is their own responsibility and not a matter for the Australian Broadcasting Control Board or the Government. From time to time, and also on an annual basis, I receive reports from the Australian Broadcasting Control Board concerning the financial results of radio and television stations. Honorable members will understand that as license fees are related to turnovers, this information must be made available to the Board and consequently to me as Minister.

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Security of Members’ Offices


– by leave - Yesterday I borrowed from the Library of the Parliament a number of publications on beef roads. These documents included a report entitled “ Beef Road Development in Northern Australia “ which was prepared under the direction of Dr. R. A. Patterson, then Director of the Northern Division of the Department of National Development and now the honorable member for Dawson in this House. This excellent publication was removed from my office between 9.30 p.m. and 10.30 p.m. last evening. To my mind this represents an intrusion on and an invasion of the rights of honorable members and it is the kind of thing that should not be tolerated within the precincts of this Parliament House. I am asking that action be taken to clear up the matter so that those responsible can be called to answer for their conduct.

The Minister for National Development (Mr. Fairbairn) had refused to make available to honorable members the publication that was taken from my office, despite the fact that this report has been available in the Library since last October. The document was also on display for delegates attending the Inter-Parliamentary Union conference which was held recently in this place. When I received this document I naturally inspected it and found that it had been presented to the Minister in June of last year. I found the subject matter of tremendous interest to me. Although the Minister had refused to make it available on an official basis in the Parliament, the fact that it was possible for me to borrow it openly, officially and formally from the Library led me to believe that it was within my right to study it and use it in the debate which is to take place in the Parliament on beef roads in Western Australia.

What I would like to know is this: Who was responsible for taking this document from my room? Who was guilty of the trespass? Where is the document at present? Has it been returned to the Library? The Minister has assured me that he knows nothing about this. Has some unauthorised person entered my room in order to take this document? This is a most serious matter, going far beyond the removal of a report. Private correspondence between members and their constituents is not safe if this sort of thing can go on.

After the removal of this document yesterday I spoke immediately to the attendant in that section of the building and I subsequently spoke to persons in the Library. I was informed that there had been a call to impound those copies of the document remaining within the Library. I spoke to the Serjeant-at-Arms and then I spoke to you, Mr. Speaker. I later had a further discussion with the Serjeant-at-Arms. I can only hope that immediate action will be taken to protect the property of members and the private and personal correspondence between members and their constituents, and above all to prevent a repetition of this kind of action. I am not blaming anyone in particular, but this incident does raise a most important matter. I have sought and received a key to my office, but keeping the office locked would raise a complication because there are attendants and cleaners who have to enter the room from time to time. I believe the attendant stationed in that part of the building has done everything possible to police the area, but it is most difficult to do so because the new wing can be entered from the old building without the attendant’s knowledge. I raise the matter in good faith in the hope that it will be clarified.

Honorable members would also like to know from you, Mr. Speaker, whether this document which the Minister refused to make available to members but which is available in the Library may be quoted from in the course of the forthcoming debate.

Minister for National Development · Farrer · LP

– by leave - Following question time yesterday, during which questions had been put to me by the honorable member for Dawson (Dr. Patterson) and the honorable member for Bonython (Mr. Nicholls), I rang my Department to ask whether the beef roads report, which the Government had decided to treat as confidential, had been released. The Departmental officers told me that to the best of their knowledge it had not been released but that they would check the situation with the National Library. They did so and discovered that the Library had received six copies of this report. Three copies were out on loan and the Library still had three copies on hand. I told my departmental officer to ask the Library to return the three copies that it had on hand and to return to the Department the other three copies if and when they were returned to the Library. I cannot think for a moment that the Library officers, in carrying out this instruction, would have gone into a member’s private room and withdrawn a copy, but no doubt we can find out from the Library itself whether this was done. My Department is at a loss to understand how these six copies could have got into the hands of the Library. The Department has a list oil every person to whom copies were made available and there is no indication that the Library had received any copies. It is apparent that someone who had access to this report did make six copies available to the Library. We are trying to discover who this was.

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The following Bills were returned from the Senate without amendment -

Aliens Bill 1966.

Migration Bill 1966.

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Tanning Industry - Australian Representation Abroad - Australian BirthratePensions - Murray Valley Development - Housing - Transport Costs in Northern Australia.

Question proposed -

That grievances be noted.


.- The tanning industry is a most important one for Australia, particularly for the State of Queensland, and it was with great concern that I read an article in the Brisbane newspapers recently to the effect that Brisbane will shortly lose two tanneries, which will be closing down after 90 years of operation. It has been stated by the manager of one of the tanneries that his factory is being forced to close because of the high price of hides and because too many hides were being exported. Some estimates put the increase in the cost of hides during the last few months at 100 per cent. This gentleman went on to say that prices are too high and that Australian tanneries cannot get enough good quality hides because these hides are being sent overseas. This situation has an effect, of course, on the price of shoes. I feel more competent to speak about the price of men’s shoes than of the shoes that women and children wear. I am naturally concerned about the price of shoes.

It is understandable that there would be a decrease in the number of hides available because of the drought. But notwithstanding this reduction in supplies, exports have been steadily increasing and fewer hides are available in Australia for tanning. A brief record of the position of the tanning industry shows that over the last five years the number of tanneries operating in Australia has declined. In 1959-60, 118 tanneries were operating. By 1963-64, the number had dropped to 102. Naturally, the price of leather increased as the price of hides rose. Notwithstanding the increase in the price of hides, the value of the output of tanneries has dropped. Unfortunately, the only available figures are expressed in pounds and I cannot readily convert them to dollars. The value of output fell from £23,2 17,000 in 1959-60 to £21,033,000 in 1963-64. Over the same period, the number of persons employed in tanneries fell from 4,435 to 4,298. So you can see, Mr. Speaker, that the position of the tanning industry in Australia has been steadily deteriorating.

The price of hides has increased considerably. lt rose by about 37 per cent, between February 1965 and February 1966. That represents a very large increase in the cost of a basic material used in the manufacture of leather. Leather is the principal material used in shoes. So you can understand, Sir, why the price of shoes has been steadily increasing. I was alarmed to see from an advertisement in the Sydney Press only this week that a pair of reasonably good men’s shoes is priced at SI 6. In my book, this is a little beyond a reasonable price.

The number of hides used in the tanning industry in Australia has declined considerably in about the last three years. In the latest statistics, the figures for bovine hides and skins are divided between calf hides and cattle and yearling hides. The total number used in 1962-63 was 3,235,000. In 1964-65, the total dropped to 2,798,000. The number of hides available for processing in Australian tanneries continues to fall. During last year, it was 250,000 in July, 215,000 in August and 219,000 in September. By January of this year, the number had fallen to 132,000 for the month. This is the latest figure available for the financial year 1965-66. This decline in the monthly total from 250.000 in July of last year to 132,000 in January of this year has been occasioned by the very high price of hides in Australia at present. These high prices have caused the tanning industry considerable trouble. The local tanners cannot afford to buy hides in competition with overseas buyers, and this situation is causing the industry much concern, for a large proportion of the available supplies is being bought by overseas interests.

It has been suggested that in the past a considerable number of hides has been exported to North Vietnam for the manufacture of footwear for the soldiers in that country. The Australian Leather and Allied Trades Employees Federation has expressed much concern over the position and its Branch in my State, Queensland, has advocated restrictions on the export of hides. Doubtless some of the honorable members who gather under the banner of the Australian Country Party and who claim to be representatives of primary producers will hold up their hands in horror at this proposal. Restrictions on exports of a commodity that is required for Australian consumption, at a time when overseas prices are high, are not unusual. I recently received a copy of Statutory Rule No. 75 of 1966, which provides for an amendment of the Customs (“Prohibited Exports) Regulations and which bears the signature of the Minister for

Customs and Excise (Senator Anderson). This Statutory Rule further restricts exports ot copper and its derivatives which are required for use in Australia, particularly in the housing industry.

For the reasons that I have given, Mr. Speaker, I appeal to the Government to look into the position of the tanning industry and of the associated industry that is engaged in the manufacture of boots and shoes. We should ensure that we retain in this country sufficient hides to meet the needs of these important industries. I am shocked to realise that tanneries that have been operating in Brisbane for 90 years are now closing down because they are unable to buy hides at reasonable prices to prepare leather for the shoe manufacturers in Brisbane. I regard this matter as being of great importance, and that is why I take this opportunity to grieve over it. I sincerely trust that it will be looked into.


.- Mr. Speaker, this morning I wish to make some observations about a very grave internal problem - the dramatic fall in the birth rate in Australia. Before I do so, 1 would like to take leave, with the permission of you, Sir. and of the House, to express my utter astonishment at the reaction that was provoked this morning when my friend, the honorable and gallant member for Chisholm (Sir Wilfrid Kent Hughes), asked the Minister for External Affairs (Mr. Hasluck) whether the Government would consider establishing a full diplomatic post in Taiwan. 1 say to some of my friends opposite, with great respect, that their reaction to the question was very childish and reflected no credit on them. Several honorable members opposite interjected and I. heard a remark in these terms: “ We will send you, Colonel Blimp “. Whether or not honorable members opposite agree with the political attitudes of the honorable member for Chisholm, the fact remains that he served as a very gallant and very distinguished officer in two World Wars. The silly and childish remark that I have mentioned did not reflect any honour or credit on the honorable gentleman opposite who made it.

May I say to the Government, with respect, that I regard it as almost incredible that Australia is to establish, on a full ambassadorial basis, reciprocal diplomatic relations with a Communist country, Yugoslavia, whereas we are tardy - 1 put ii no more strongly than that - about establishing a diplomatic post in Taiwan. The fact of the matter is that Yugoslavia today knows little of the democratic tradition. The fact is also that Taiwan, in a broad sense, walks in the democratic tradition. One finds it rather irritating to look around the world and see this country extending diplomatic recognition to countries which have precious little international personality, and then to look at countries like Taiwan which remain a bulwark against aggressive Communist Chinese attitudes in the Far East. I would hope that the Minister for External Affairs and his colleagues in the Cabinet would turn their minds to this problem and accept realistically our position. 1 hope that they will extend to Taiwan full diplomatic accreditation and offer that country all the courtesies involved in recognizing the vital position that she plays in our sphere of existence - one could say in our sphere of destiny.

Turning from external affairs, I would like to say something about what I regard as a dramatic decrease in Australia’s birth rate which poses problems on the short term basis and on the long term basis. It is sad to note that since 1961 the birth rate in Australia has dropped from 22.8 live births per 1,000 of our population to 19.6 live births per 1,000 in 1965, the most recent figure available. This drop of 3.2 live births per .1,000 has occurred in the last five years. It is very difficult to predict statistics of this sort. But if one proceeds from the premise of taking the existing factors, such as existing sociological factors, the existing political factors, the existing rate of migration and so forth as representing one parameter, then between 1973 and 1981 this drop, if continued, could be spelt out at a figure of ten live births per 1,000 of our population.

It requires no emphasis from me to show that this is a problem of great magnitude for Australia. I am one who holds the view that we are threatened from without by forces that want completely to overwhelm our way of life. But it would seem to me to be futile in the extreme to win that struggle for survival outside but lose this struggle for our existence within our country. Whether we like it or not, we cannot pretend to put ourselves in the position of imagining that we can hold this vast country with a birthrate which, if not declining, is perilously close to it. I propose in a moment or two to offer what I hope will be accepted by the Government as a recognition of the problem and a solution to it. I am not one of those people who take the view that we should encourage the women in Australia to go outside the home. I do not regard this as social emancipation. I regard it as being in a very real sense a national tragedy. But women will not remain in the home if they are not encouraged to do so. This problem has been seen in other countries of the world, notably in Canada and in France. The birth rate in France started to fall in the 1770’s. It continued to fall almost to the beginning of World War II. One could find a number of reasons for that fall - the French Revolution, the fact that the Napoleonic code brought a system of inheritance by which all peasant farmers had to pass over their estate in equal shares to their children. These factors and others combined to force down the French birth rate. Then, in 1939, recognising the problem, France moved dramatically and introduced a wholesale system of family allowances. This has stimulated the birth rate.

I hope that the Government will be persuaded to look anxiously and, again I say with respect, realistically, at trie decline in Australia’s birth rate. I hope that the Government might be persuaded to introduce not merely some nominal modification of our system of family allowances but to introduce some dramatic change in it. It is completely unreal to expect the wives and the mothers in our country today to remain in the home and to try to keep up with the single girl who is earning infinitely more than the amount she is receiving and with which, in many cases, she is keeping a family. I hope that the Government recognises the problem in that light. Quite apart from the intrinsic question of social justice which, I submit, is represented in this problem of putting mothers in a position in which they will have more money on which to keep their children, I submit that the Government and, indeed, the Parliament should recognise that if our birth rate continues to decline as it has over the last five years then the next generation is going to be smaller in numbers.

Having said that, one may observe finally that the burden of raising the next generation is falling upon an increasingly smaller number of people in the community. Unless incentives are given to people to have families we cannot expect them to accept the responsibility of raising future generations of Australians. I hope that my friend, the Minister for Health (Dr. Forbes) who is sitting at the table, will pass on to his colleagues, in particular to our mutual friend the Treasurer (Mr. McMahon), the point I have made this morning. I think it is a very real one. I think the country must be prepared to face up to this matter realistically and, beyond that, to act promptly.

West Sydney

Mr. Speaker, I intend to devote the ten minutes available to me to talking about social services. Possibly two weeks from today this Parliament will go into recess until early in August. When it meets again the question that will be on everybody’s lips will be: What is the Budget going to bring to me? While people will be looking forward to the Budget in August for their own good or evil, the pensioners will be looking forward to it also. I think it is a crying shame for this Government to wait until the last few weeks before a Budget is presented to announce in some way what it intends to do for those poor people. In my electorate of West Sydney, possibly, there is the largest group of pensioners in the Commonwealth. There are some 4,000 to 5,000 pensioners living there. At meetings of pensioners, it is degrading for these people to have to contribute one shilling or two shillings to send somebody to Canberra in order to see what the pensioners will get from the Budget. I remind honorable members that always before the Budget session buses carrying pensioners arrive here in Canberra from all parts of the Commonwealth pleading to see the Minister for Social Services. But they are lucky if they get five shillings when the Budget is presented. The cost of living need not be related here by any honorable member because everyone knows what it is. I would think that the Government would say prior to the Budget announcement that it realises the pensioners are in a bad way. I would think it would say that, regardless of what it does for other people, it will at least give the pensioners £1 a week extra and allow them to live in the Australian country that they have loved and worked in all their lives. But the Government will not do this. It will not say what it intends to do about pensions, and men and women in ali parts of the Commonwealth will put in their ls. and 2s. to hire a bus to come to Canberra and make representations to the Government. If this happens again, the blame will fall on the Government.

Were it not for the Sydney City Council and the ratepayers of Sydney, pensioners in Sydney would be dying of hunger. The City Council provides 1 1 centres for the care of pensioners and possibly 10 out of the 1 1 are in my electorate of West Sydney. In my electorate, between 300 and 400 pensioners have registered their names for the luncheon that is given by the Council every day. The Council, with the help of many good people from all parts of Sydney, provides a dinner daily for 2s. It could not be bought in any other establishment for 7s., 8s. or 10s. This meal is all that saves the people who come there from death by starvation. Five days out of the seven each week they are given a meal and, with the addition of some small items they buy out of their pension, this carries them over. There is not a room in Sydney that can be rented by a pensioner for less than £3 a week. Even if pensioners receive £6 a week, they are left with only £3 to buy everything else that they need. The Government sends millions of pounds to India and to other countries, and rightly so. I thoroughly agree with this action. Nevertheless, when starvation strikes at home, we should look after our own people. They reared sons and daughters to go to the last two wars but they are now left on the verge of starvation. This does no credit to the Government. 1 ask the Government, before the Budget is presented in August, to reveal in some way what it intends to do for pensioners. lt is no good waiting until the week before the Budget is presented, when cars carrying pensioners will arrive from all parts of Australia. Pensioners throw in their ls. and 2s. at meetings so that they can hire vehicles to bring them here. But what is the result? Nothing more than an increase of Ss. in the pension has been given in the last three or four years. If we go back over the past 10 years, the annual increase would not average 5s. In two or three years, the pensioners did not get anything at all. The Government talks in millions of pounds and prepares a Budget amounting to £2.000 million. But it thinks that pensioners can live on fresh air. 1 appeal to the Government to give the pensioners something on this occasion. The Budget will be presented in three months’ time. Winter is coming, and surely my appeal will not fall on deaf ears on this occasion: 1 would like to mention another situation for which the Government is strongly to blame. This is the Government’s attitude to age persons homes. 1 give the Government credit for what it has done. Labour started this scheme. The subsidy at first was £1 for £1 and now it is £2 for £1.

Mr Turnbull:

– Who started it?


– It was in our policy speech in 1949, if the honorable member wants to know. But he does not want to hear about anything that will cost him ls. or will help pensioners. At present, if organisations have enough money or land to attract the £2 for £1 that the Commonwealth Government gives, they can build plenty of homes for aged people. But they must first find the £1 to attract the £2. How can working people today possibly be expected to find this money? The Church of England in my electorate has received £ 1 1 5,000 for a home simply because it had the land. But this does not cover the whole multitude of people who are waiting for homes. If it is good enough for the Commonwealth Government to give £115,000 to people who have land, surely it is good enough for the Government to change one word in the Aged Persons Homes Act and allow city councils, local government authorities and State governments to help organisations to get the Commonwealth subsidy. The Sydney City Council tomorrow would give land to people who wanted to provide homes for pensioners, but it is prevented from doing so by this Government. In country areas, councils would help to build homes for the aged if the Government allowed them to donate land that would attract the subsidy of £2 for £1.

I think it is shameful that the Government and the Minister for Social Services (Mr. Sinclair) will not allow this to be done.

I do not blame the Minister. I know he would do it tomorrow if the other tyrants in the Government would let him. I appeal to the Government to lift the restrictions that prevent local government authorities from making donations of land on which homes for the aged will be built. Plenty of people are ready and willing to look after pensioners, not for money or high wages but as an act of charity. But they cannot raise the initial amount that would bring the Commonwealth subsidy to them. I appeal to the Government to help them set to work to provide homes for the aged. In West Sydney, sporting bodies, such as trotting organisations and greyhound racing organisations, have offered-


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


– This morning I wish to speak about what is probably Australia’s greatest productive area and certainly the area with the greatest potential for production in the whole of the Commonwealth. I do not need to tell honorable members that I refer to the Murray Valley, through which flows Australia’s greatest waterway, the Murray River. Large quantities of water have been taken from this river for irrigation and this has brought about vast production for the benefit of all Australia. But now more water is coming into the Murray River from the Snowy Mountains scheme and the volume of water will continue to increase. This water must be used to the best advantage. In the past, millions of gallons of water in flood time have gone into the ocean and have been lost to the country. The people of Australia, and expecially the members of this Parliament, are beginning to realise that the future of Australia depends very largely on water conservation. The land in the Murray Valley is of high quality and will grow almost anything, if an adequate water supply is available. This morning, I advocate the setting up of a Murray Valley commission to develop the potential of the Murray Valley.

Mr Cope:

– We already have such a commission.


– Opposition members interject that we already have such a com mission. This shows that they really are not acquainted with what is happening. All that we have at the present time is the River Murray Commission. I ask for the appointment of a Murray Valley Commission. I am not making this plea without first having made some investigations by reading and by asking questions in this House. Let me refer first to a question I asked on 27th April, only yesterday. The question had reference to keeping down the salt level of the water being supplied to irrigators. The Minister is making investigations with the idea of providing me with information. This is one of the great problems in the Murray Valley. The water coming out of the River Murray for irrigators is, in many cases, doing more harm than good. On 20th April I asked a question regarding pipelining. The Minister for National Development, when answering the question, said -

The River Murray Commission consists of representatives of the Governments of New South Wales, Victoria, South Australia and the Commonwealth, but once water from the Murray leaves the river it is up to the State concerned how that water is used.

I believe that if we had a Murray Valley Commission instead of the Murray River Commission the functions of the River Murray Commission could be incorporated in the Murray Valley Commission. You cannot divorce water in the river from the use that is made of it after it leaves the river. Some plan has to be evolved to control the amount of water to be made available and how it can be used to best advantage.

As the Minister stated - and it has been said in the House on many occasions - the River Murray Commission has jurisdiction only over the water while it is in the Murray. Something should be done to bring about a dual advantage. More water could be obtained and the best possible advantage could be made of the water available. I have advocated in this House on quite a few occasions that investigations should be made by representatives of the Commonwealth and the States concerned - the States of South Australia, New South Wales and Victoria - into the possibility of pipelining the water from the River Murray to the areas where the water is to be used for irrigation. As I have stated before in this House, it has been said by a very high authority in Victoria that less than 10 per cent, of the water that travels from the reservoirs gets to the areas of intended consumption. This loss of water is something we can afford in Australia. Therefore I believe that we should do something about pipelining the water to where it is needed. The Minister has said, of course, that the transporting of water from the river to the places where it is to be used is no concern of the River Murray Commission. It appears to me therefore that there is no active co-operation between the River Murray Commission and the users of the water. It has been said that the States concerned must decide this matter. I have asked that a meeting be convened of all the States concerned and the Commonwealth. The Minister has stated that the River Murray Commission is the body that controls the supply from the river. That is true, but the River Murray Commission does not control or, indeed, encourage the use of the water to the best advantage of ell the people of this country.

The Murray Valley is, without doubt, a great productive area in the making. The Murray Valley Development League has done splendid work. It puts out a publication regularly entitled “ Riverlander “, which is read by many people. I have a copy here. This publication gives much information of what is going on in the area. The Murray Valley Development League, of course, has no authority. I have even advocated in this House that money contributed to the work of the League should be a deduction for tax purposes, but 1 have not been successful in my advocacy. A large area of productive lands could be brought into production along the Murray from its source right to its mouth. Many kinds of products sought by Australians could be grown, and many of these products could be sold overseas. Let me name a few of them. There are dried fruits for a start. All honorable members know the large amount of money that comes into Australia from the sale of the products of the dried fruits industry. Then there is the citrus industry. People all over Australia enjoy the quality oranges grown in the Murray Valley in South Australia and Victoria. Then, if irrigation is made available, pastures can be improved for fattening cattle, sheep and lambs. Other crops also can be grown. We have, for instance, olive groves near Robinvale. If any honorable member has an opportunity to go there he should do so. Oliveholme at Robinvale managed by Mr. Philip Henry is worth seeing. The production of olives could be expanded so as to supply Australia with all the olives necessary for the production of the olive oil we use. At present only a very small percentage of Australia’s requirements is grown in Australia. With irrigation we could grow more olives, and if the Government were to look at the industry in a favorable light we could have a dual industry which included both the growing of the olives and the processing of the olive oil. This would give employment to many Australians. In addition we would save a large portion of our overseas balance that is spent in purchasing olive oil. Co:ton is another suitable crop. It has been shown definitely that cotton can be grown prolifically and economically in the Murray Valley. Most of the crops I am thinking of must have irrigation. They are not like wheat which can be grown without irrigation. With these other crops, if you have no irrigation you may just fluke a crop of cotton, olives or even pasture, but if you have irrigation you are almost assured of success.

I suggest therefore the setting up of a Murray Valley Commission which could take the place and do the work of the Murray River Commission. In addition, a Murray Valley Commission could provide information and make suggestions and recommendations as to the best use of the water from Australia’s greatest waterway, the River Murray.

Smith · Kingsford

– Everyone will agree with me that there is an unprecedented demand throughout Australia for homes. Honorable members hear complaints from all sides about the grave shortage of homes within the reach of the average working man - and who is more entitled to a good comfortable home in which to rear his family than the average working man? He is the most important individual in our community. When a shortage of any kind occurs it becomes an avenue for speculation which is exploited to the full, and all sorts of devices are resorted to.

Looking around today one sees a practically fresh avenue of exploitation, namely the building for sale or letting of home units. In order to build home units one must have land. There has begun a frenzied search for land by the professional speculators, for instance, the members of the organisation known as the New South Wales Real Estate Institute, and a new lurk has been evolved. Members of this organisation approach people living in private homes and offer them large sums to vacate these homes, the idea being that 12 to 18 home units can be built on one block and sold at extortionate prices or let, sometimes at $20, $30 or $40 per week. Honorable members will agree that that is a very good lurk indeed. Of course, like everything else, this has had its repercussions. This frenzied rush for land has caused a very rapid increase in prices, which have risen quickly to the unheard of level of £5,000, £6,000 and £6,500 per block with the prices still rising. We must agree that home unit development is very remunerative. A price of £5,000 or £6,000 for a block is beyond the reach of young working class couples in my electorate. This means that their chances of having their own home are very poor.

Feeling strongly, as I do on this matter, I embarked upon a personal survey of my electorate to see just how much building land was available. With the close cooperation of His Worship the Mayor of Randwick and his Labour councillors, we were able to pinpoint many acres of first class building land. On investigation I found that most of that land had been lying idle for many years. The Government, of course, is always going to do something with it. First, there is the Long Bay rifle range, 37.15 acres of which is set aside by the Commonwealth for subdivision for Army housing purposes. This has been the intention for years, but still nothing seems to be done about it. An area of 24 acres has been set aside on the coastline for open space, which is to the good, and 111 acres adjacent to Cromwell Park, which is further south, has also been reserved for open space. Between these three points is an area of 253 acres for the rifle range. I have commented on this range many times. I live very close to it and I can assure honorable members that it is very seldom used. I suggest that the range and whatever equipment remains - buildings etc. - should be removed to Liverpool close to where our military forces are encamped. This applies also to the facilities for rifle clubs and other organisations which use the range. The hairbrained idea of having a military rifle range so close to the coast and in the centre of a thickly populated district in these dangerous days does no credit to the military heads or, for that matter, to the Minister for the Army (Mr. Malcolm Fraser). It is horrible to contemplate what could happen in the event of enemy action being centred on that area. The range must be removed as quickly as possible in the interests of the safety of my constituents.

This area of valuable building land should be transferred to the State to be cut up into building blocks and balloted for because 253 acres at five houses to the acre would allow for the building of 1,265 homes. With an average of four people to each home the area would provide housing facilities for 5,060 people. A completely new suburb could be erected on that now vacant land. The Randwick Municipal Council, whose district includes this area, supports me in my conviction that the rifle range activity should be re-sited at a location outside the metropolitan area. Many other areas in the electorate of Kingsford-Smith are held by the Commonwealth in the sacred name of defence. The military brass hats evidently like to hold large areas of land. It gives them a feeling of great power. I should like to refer to another area which is now held under lease by the New South Wales Golf Club Co. Ltd. This area is a mere 200 acres, the lease for which is for a period extending from 1st March 1961 to 28th February 1981 - a mere 20 years. It seems that certain persons have no trouble in getting leases from the Commonwealth for various purposes.

Let us look at the reply to a question only last week when I elicited the information that the rental on this lease until 1971 was at the rate of $4,000 per annum, which works out at $20 per acre. That is very good business indeed. The terms of the lease go on to say that for the remaining period of the lease the rental will be at a rate determined by the Commonwealth. But that is not all. I asked also in the question whether the names and addresses of the board of directors of the New South

Wales Golf Club had emerged from the negotiations in connection with the lease and, if so, who they were. I received the astounding reply that the lease was executed on behalf of the New South Wales Golf Club Co. Ltd. by Messrs. E. B. Jones and R. R. Anderson who were directors, but that their addresses were not known. So we see that the Commonwealth leases 200 acres of very valuable land to two persons whose addresses are unknown. What next? I do not want honorable members to think that I am opposed to golf clubs in my electorate - far from it. I encourage them, but I would like the books of this club thrown open for applications from people who live in the district. It would give me great pleasure to see more opportunities open for my constituents to play the great game of golf.

But let us go further around the bay to Congwong Beach at La Perouse where the Commonwealth controls 46 acres of lovely land between the beach of lovely golden sand and the overseas telecommunications radio station. If the Commonwealth would release this lovely section of land the Randwick Municipal Council, 1 am advised, would be prepared to set up a recreational reserve and construct a shark proof fence so that the school children of the district could enjoy the pleasure of the wonderful beach of golden sand and swim in perfect safety. I especially recommend this suggestion to the Minister for his earnest consideration. He may decide to give the youngsters a chance to enjoy themselves. Knowing the Minister as I do and knowing that he is a family man, I am sure that he will give deep consideration to this matter. May I suggest to him that we make arrangements with the popular Mayor of Randwick, Alderman Bill Haigh, and his equally popular Labour aldermen for a tour of inspection by the Minister, the Mayor and the member for Kingsford-Smith at a time convenient to the Minister? I am sure that it would be worth while and that the Minister’s eyes would be opened to see the vacant land held there in the sacred name of defence.


– I rise to comment on an incident in this House earlier this morning. The honorable member for Chisholm (Sir Wilfrid Kent

Hughes) asked a question regarding our representation in Taipei, which is the capital of the Republic of China on the island of Taiwan. When this happened, immediately from the Opposition ranks there arose a murmur, an outcry and an attempt to pour derision on this. It was remarkable. There is, as honorable members opposite have said, a China lobby in this House. There is a lobby for Communist China and it is centred in the ranks of the Opposition. It is a terrible and distressful thing that our Communist enemies have been able to implant their seeds of subversion in the minds and hearts of members of the Opposition so that perhaps without any intention of pro-Communist treason and without knowing what they are doing they make themselves the mouthpiece for our Communist enemies.

Mr Peters:

– Who does?


– Members of the Opposition. I refer particularly to comments made by interjection by the Deputy Leader of the Opposition (Mr. Whitlam) who does, I think, still have some kind of nominal authority within the party opposite. The honorable member for Werriwa, the Deputy Leader of the Opposition, was insistent in interjecting. He was saying in indignation - I do not know whether it was mock indignation or genuine indignation, but it was apparent indignation - “ These people are not our allies. What kind of treaty have we got with them? “ His heart belongs to Red China, apparently, as he made clear by his interjections here in the House earlier this morning.

I have said something about the Opposition. Now I wish to say something about the Government because I do not think the answer given by the Minister for External Affairs (Mr. Hasluck) was either very coherent or very satisfactory. He said that we cannot appoint an ambassador to China in Taipei because of the exigencies of the staff position, although only recently the Government has seen fit to appoint an ambassador to Yugoslavia, which is a Communist country. It might be asked: Why is the Republic of China, whose capital is Taipei, important to us? Let me put six reasons before the House, which should move the Minister to repair an omission of many years standing and to appoint immediately an ambassador to the Republic of

China in Taipei. The first reason is that the Republic of China is a member of the United Nations, with a permanent seat and a right to veto in the Security Council. This makes the country very important in world politics.

Mr Griffiths:

– How did the Republic of China come to get its seat?


– Here we have a member of the Opposition interjecting on behalf of the Communists. Once again honorable members opposite are following the usual pattern. They are lining up with the Communist propaganda. They are the mouthpiece in this House of our Communist enemies. This is a terrible thing. They are convicting themselves now out of their own mouths. The Republic of China, the Taiwan Government-

Mr Peters:

– I rise to a point of order. Is this scurrilous nonsense to be allowed to continue? Under what Standing Order is an honorable member permitted to perform as the honorable member for Mackellar is performing?


– Order! There is no substance in the point of order.


– Honorable members in this House are entitled to tell the truth and they are entitled to draw the attention of the public to what the Opposition is doing, and the honorable member for potter’s field will know this himself. I repeat that the first reason why we should be supporting the appointment of an ambassador in Taipei is that the Republic of China is a member of the United Nations with a permanent seat and the right to veto in the Security Council. The country is important in world foreign policy. The second reason is the matter of defence. The Republic of China maintains an army of 600,000 or 700,000 which pins down, by its presence, the armies of our Communist enemies. Is this unacceptable to honorable members opposite? Are they not glad that there are opponents of Communist China who are willing to put not just a battalion or two into the field, but are holding in readiness 600,000 or 700,000 fully trained men and so imposing on Communist China the necessity to keep large forces available? The third reason relates to the question of intelligence. Taipei, as honorable members should know, is the centre for anti-Communist intelligence throughout Asia. Taiwan has agents in Communist China. We can learn a lot and it is important that we should heed the lessons. It is important that we should make these sources of information available to our departments in Canberra.

The fourth reason why we should support the appointment of an ambassador in Taipei is that Taipei is not only a centre of anti-Communist information and intelligence, but also a centre of anti-Communist organisation. Does this grieve honorable members opposite? Are they going to interject? Do they consider anti-Communist organisation a bad thing? If this is happening in Taipei, surely we should be taking advantage of it. The people there are on our side. Is it so bad that we should be represented there? The fifth reason relates to the question of trade. Taiwan is a small island, but its population is now just a little greater than the population of the Commonwealth of Australia. Trade between the two countries could be quite considerable. If we are conducting an export drive, then this is one of the countries in which we should have diplomatic representation.

The sixth reason why we should have such representation relates to the matter of scientific information. In many respects, Taiwan’s agriculture is more advanced than ours. I know that the climate is different from the general Australian climate, but it is not so different from the climate on the Queensland coast. Indeed, Mackay and Taipei could almost be considered homoclimes. There are species of trees and plants on Formosa which would be of great advantage to our agriculturalists. The people of Formosa have newly emerging methods of cultivating rice, which are being availed of throughout Asia. Formosa leads the world in the scientific cultivation of rice. Would not it be a good thing if we were to be exchanging information with that country?

Those are the six reasons why I suggest we should appoint an ambassador in Taipei. They add up to the fact that the Government is guilty of a sin of omission in not having appointed an ambassador in Taipei many years ago. The explanation given by the Minister in this House today is, I am afraid, only eyewash in view of the fact that the Government has been able to find staff to appoint an ambassador in Belgrade, the capital of the Communist country of Yugoslavia. That is all I have to say, but I do once again ask the Government to reconsider its position, and once again I point out to members of the Opposition that their interjections convict them as being pro-Communists.


– I rise to speak on a subject which is causing considerable concern to the people of Queensland, the Northern Territory and Western Australia. It relates to the Loder Committee’s investigation and report on transport costs in northern Australia. The Committee was formed as a result of a promise made by the former Prime Minister, Sir Robert Menzies, in his policy speech prior to the 1963 election. The terms of reference of this Committee were to make a thorough and factual investigation of and to report on the cost of transportation in northern Australia; to examine the possible means whereby such costs might be reduced and to report on the practical and economic feasability of each means so examined.

The announcement of the appointment of the Committee by Sir William Spooner on 16th April 1964 brought delight to most people in the north. It was an excellent Committee. It comprised Sir Louis Loder, former Director-General of Works, Mr. Peter Baillieu, a cattleman from the Northern Territory and a well known businessman in Australia, Mr. L. G. Blythe, Managing-Director of Air Beef Pty. Ltd., Mr. B. Callaghan, Managing-Director of the Commonwealth Banking Corporation, Mr. G. R. Fisher, Chairman of Mount Isa Mines Ltd., and Captain J. P. Williams, Chairman of the Australian Coastal Shipping Commission. It was an excellent independent Committee seized with the chance of examining a most important problem. It talked with Premiers and made investigations throughout the north. Its report was completed about seven or eight months ago and since then the report has been under examination by the Government.

The honorable member for Stirling (Mr. Webb) has asked questions about the report, and the replies given to him in this House indicate that the Government will make the report available as soon as it can. My point is that the substance of this report was based on details and facts collected principally in 1964. This means that in 1966 the facts are becoming dangerously close to being out of date. In the interests of this Parliament being able to debate effectively a most important report when it is brought forward, we should be given the opportunity of examining it. I am afraid that what will happen will be the result of the practice of the Treasury’s delaying tactics. The report will probably be released by the Government in either the last week of this sessional period and before the introduction of the Budget, or possibly just after the Budget. In other words, we will not have a chance to examine it properly. Before we know where we are the report will be thrust upon us and we will not have a chance to examine it before the Budget debate.

Those concerned with Queensland, Western Australia and the Northern Territory know that there are many instances today of almost blatant discrimination against the northern people. If we look at Queensland railway revenues we find that during the last 15 years the north Queensland railway system and the central Queensland railway system have made a profit of §50 million but in the same period the southern Queensland railway system has made a loss of $74 million. It is obvious that this is a serious position. It means that the people of northern Australia through freight rates are subsidising the freight rates and passenger services of the southern and metropolitan railway systems, lt, of course, needs no elaboration that this will be a serious inhibiting factor to northern development. Another aspect is the discrimination against northern people in contract rates. This has been clearly demonstrated in respect of the Army base now being constructed in Townsville. I have before me a copy of a letter sent by the Townsville District Development Bureau to the Prime Minister expressing great concern that the Loder report is not being made available and that any suggested recommendations in it are not being implemented. In part the letter states -

At this present time the State Government has incorporated as policy a concessional rail freight on fabricated steel and other building materials ex Brisbane for all major constructional projects in

Queensland country areas. This rail freight heavily favours Brisbane-based manufacturers and does, in turn, preclude firms from developing manufacturing industries in Queensland’s northern areas.

In other words anybody in Townsville, Cairns, Mackay or Rockhampton is virtually precluded from taking advantage of many of the opportunities available in construction because of the policy of giving discriminatory freight rates in favour of southern areas.

Mr Brimblecombe:

– Not in total.


– I am speaking of fabricated steel and am referring to the Army base in Townsville. We cannot get information on specific contract rates. I have tried to ascertain the special contract freight rates, but they are not available. It is a matter of Queensland Government policy that they be not available. Another matter is that sales tax on air conditioning apparatus - on fans - is greater than it is on heating appliances used in southern Australia. Another aspect in favour of the north relates to the balance of payments situation. I agree with Mr. Charles Court of Western Australia who said recently that Western Australia and Queensland are to a large degree, because of their heavy export surpluses, carrying the southern States on their backs. In the last 10 years - and these figures are available from the Treasury - in Queensland the trading surplus, that is, the value of exports minus the cost of imports, has been $2,600 million. In the same period in southern Australia - in New South Wales and Victoria - there has been a trading loss of $4,200 million, lt is quite obvious that here again the northern people and the northern industries are being discriminated against. One can cite many practices or instances of discriminatory freight rates. I have no doubt that the Loder Committee will bring some of these out in its report. The facts are well known, and Queensland organisations have sent me copies of evidence they have given to the Committee. Most of these facts have been given in evidence.

I stress that the report should be released to the Parliament. I can see no reason why it should have to be examined by Government departments for over seven months before the Government is able to implement any of its recommendations in the Budget and then be thrust upon us for debate with out our having had time to study it. If we are going to make an intelligent contribution to a most important subject we should have the right, after seven months, to have access to the report.

Sir Wilfrid Kent Hughes:

.- First 1 should like to thank the honorable member for Moreton (Mr. Killen) and the honorable member for Mackellar (Mr. Wentworth) for their support of the underlying principle involved in the question I asked earlier today. For the reasons given by the honorable member for Mackellar, 1 was not surprised by the outburst from the Opposition, nor by suspicions that certain members of the Opposition seem to harbour in their minds, namely, that if anybody supports what he believes to be the right principle he must be in the pay of some foreign power. In a television session the other day when I was asked a question on Vietnam I concluded my answer by saying that I thought it was a great pity that Mr. Calwell, Mr. Whitlam and Dr. Cairns had never bothered to visit Vietnam to find out what the troubles, difficulties and problems were in that unfortunate country. Immediately the Deputy Leader of the Opposition (Mr. Whitlam) lost his temper - and I was rather nervous because he had a glass of water in front of him - and accused me by saying: “ It is quite easy, Mr. Chairman, for Sir Wilfrid to go to South East Asia, because his expenses are always paid by the Government of Taiwan “. I answered him in the correct way by saying that his accusation was a blatant lie. I said also that 1 had. travelled to South East Asia at my own expense on the last five occasions I had been there, and said that the Deputy Leader of the Opposition could have gone there. Even if I had had my expenses paid, I cannot see anything very different in that from the situation of the Labour Party travelling in a large party at the expense of the Government of Singapore. I do not criticise them for accepting the invitation to go to Singapore. It is interesting to note that the Deputy Leader of the Opposition has been twice to South East Asia. His first visit was at the Expense of the taxpayers. I make no criticism of that. His second visit was at the invitation of the Prime Minister of Singapore. I cannot understand why he should criticise other people, quite erroneously, who wish to make visits to these places at their own expense

In order to maintain their contacts. This is further evidence of the totally unreasonable antagonism displayed by the Opposition towards the Republic of China and the Government in Taiwan. In other words, as the honorable member for Mackellar said earlier, the real China lobby in this House is the Opposition’s China lobby on behalf of Peking.

I was not satisfied with the answer given this morning to my question by the Minister for External Affairs (Mr. Hasluck). After all, we have diplomatic representation in Pakistan, India, Ceylon, Burma, Singapore, Malaysia, Thailand, Laos, South Vietnam, the Philippines, Japan and Korea. The only friendly ally omitted is one which incidentally has enabled us to obtain our defence on the cheap for a long time past, namely the Republic of China in Taiwan, and we have had that country’s ambassador here almost ever since the last war. Yet we have not reciprocated by appointing a diplomatic representative, even a consul, ito Taipeh. Can any honorable member give any logical reason why we have acted in this way? Is it on account of our trade with Peking? I do not think so, for the simple reason that Mr. Chou En-lai has on two occasions recently threatened that if we continue to send troops to Vietnam his country will refuse to buy our wheat and wool. Apparently that was an empty threat because it has not been put into practice. I am glad that the threat has not deterred the Government from fulfilling our obligations, both of treaty and otherwise and in the interests of our security, with regard to sending even more troops to Vietnam than we had sent when the threat was made.

So it is difficult to understand why we continue to refuse to exchange diplomatic representatives with a country which, as the honorable member for Mackellar pointed out, is only a little more than half as big as Tasmania - two thirds of it mountainous - with one million more people than there are in Australia. Notwithstanding its size, what has been done there in reconstruction and rehabilitation is the miracle of the post war era. Whenever you go there the people say: “ We have done all this with American aid and assistance “. There is not national upsurge or boasting about what they have done. They are frank that they have done it with

American aid. In fact, the country has become a pattern for the manner in which co-operation between the West and the East can raise the standard of living of countries of Asia, and anybody who goes there knows this well. As a matter of fact, economic aid is not now necessary from America because exports now exceed imports. The landtothetiller programme has been finished and secondary industries are being established to absorb 100,000 school leavers every year. Yet, with an eye to future trade, the Chairman of the Australian Wool Board visited Peking on several occasions and offered to subsidise with long term loans the establishment of textile mills in Communist China. I do not think he has ever visited Taiwan or shown any interest in establishing trade with that country. All through, we have had antagonism of this kind towards the Republic of China. I think this attitude arose first because our foreign policy was, until recently, fashioned by Westminster. We had a blind spot with regard to Asia. Now that is no longer there.

I congratulate the Prime Minister (Mr. Harold Holt) on his successful tour and on what he is doing to make up lost ground. But in making up lost ground one of the main features of our policy should be to rectify what has been an insult to one of our best allies and the showpiece of how Asian people can be assisted in raising their standard of living. I expect that within four years the same thing will happen in Korea and that the two countries will set the pattern for the rest of South East Asia once security has been provided, which must be No. 1 priority. I firmly believe, as I have said on other occasions, that the Republic of China will establish a pattern and set an example which may alter the course of the world’s history in regional co-operation and regional development. So I trust that we will not go on with this pusillanimous policy that we have followed in the past of not providing diplomatic representation in Taiwan.

I once met a high ranking diplomat of another country - no names, no pack drill - and asked him why he thought Britain had been so quick to recognise Communist China. His reply was that he had been talking to one of Britain’s Ministers - again, no names, no pack drill - who had said: “If you had £300 million or £400 million invested in a country would you not try a salvage operation? “ Three years later the diplomat again met the Minister in London and said: “ How did you get on with the salvage operation? “ The Minister replied: “ We have been a lot of idiots. We did not save a penny.” That was the original basis of Westminster’s policy and unfortunately we have followed in the train of Westminster and, like Britain, have refused to establish an ambassadorial post in a friendly country, which has been so successful and largely or partly responsible for our defence in the past. I ask the Government to rectify this error. I congratulate the Prime Minister on his statement that he will visit Taiwan in the near future. I hope that this diplomatic omission will be rectified before the visit is arranged.

Question resolved in the affirmative.

Sitting suspended from 12.43 to 2.15 p.m.

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

Second Reading

Minister for Trade and Industry · Murray · CP

– I move -

That the Bill be now read a second time.

The purpose of this Bill is to seek the approval of Parliament to the signature and acceptance by Australia of the Protocol extending the International Wheat Agreement 1962 for a further year. Honorable members will recall that similar action was taken last year.

In 1962, Parliament approved the acceptance by Australia of the International Wheat Agreement which had been negotiated that year in Geneva. The terms of the Agreement provided that it would expire on 31st July 1965, and prior to that date it would have been customary to re-negotiate a new Agreement to take effect as from that date. However, at that time most of the trading countries of the world were already engaged in the Kennedy round of trade negotiations in Geneva, and in the circumstances the International Wheat Council agreed that the existing Agreement be extended for one year. It was expected that if comprehensive arrangements to regulate trade in cereals, including wheat, could be negotiated they would make redundant an International Wheat Agreement of the present type. Unfortunately, progress in the Geneva negotiations has been slower than expected and the International Wheat Council in November last year agreed that the most practical procedure would be to again extend the Agreement for a further twelve months; that is, until July, 1967.

Since 1949 there have been a series of International Wheat Agreements. Australia has been a member of each Agreement. The provisions of these Agreements have been debated in the House on a number of occasions. Honorable members will be aware that the main purpose of the Agreement is to ensure some degree of stability in the range of prices within which wheat is traded commercially. In this respect the International Wheat Agreement has served a useful purpose even thoughthe actual range of prices designated within it has not been totally satisfactory from our viewpoint. Although the various Agreements have helped over the years in achieving more sensible arrangements for the marketing of wheat internationally, it would be generally agreed that the International Wheat Agreement type arrangement does not adequately cover all the problems encountered in the international wheat trade.

The trade negotiations which are proceeding in Geneva are, for the first time in the history of the General Agreement on Tariffs and Trade, tackling the problems of agriculture. However, because of the complex and sensitive problems of agriculture, progress in the negotiations has been slow. Moreover, the internal difficulties experienced by the European Economic Community over the past 12 months or so have further delayed progress. There are now signs that these difficulties have been largely overcome and that the E.E.C. will soon be in a position to resume effective negotiations on cereals. It would seem appropriate if I were to remind the House of the objectives of these negotiations insofar as they are likely to affect wheat.

At the G.A.T.T. Ministerial Meeting in May 1963, which I attended, it was agreed that a significant liberalisation of world trade was desirable. It was also agreed for the first time - and this is most significant - that the negotiations should cover all classes ot products, including agricultural products, and should deal not only with tariffs but also with non-tariff barriers to trade. The G.A.T.T. Cereals Group was given the responsibility of negotiating comprehensive arrangements for cereals, including wheat, which would cover nacional support programmes, international prices, access to markets and non-commercial transactions.

When speaking to a similar Bill last year, I pointed out that the provisions of the International Wheat Agreement are limited. The Agreement does nothing to inhibit the protection afforded high cost wheat production. Highly protectionist wheat policies pursued by many industrialised countries have led to a shrinking or, at the best, a stagnation of their imports of wheat. Unless these countries are prepared to accept some commitments on domestic production, this trend will almost certainly be accelerated with the application of modern technology to farm production, particularly in Europe.

Equally disturbing is the fact that the price level at which wheat is traded internationally is far from satisfactory. The socalled world price for wheat, which exporters of wheat are obliged to accept, bears little relationship to prices being paid for the great bulk of the world’s wheat production. It is an intolerable situation when efficient wheat producing countries are from time to time forced to resort to subsidies in order to maintain the incomes of farmers at’ reasonable levels. Over recent years world prices for wheat sold on world markets have been largely determined by the subsidy and dumping practices associated with the level of protection afforded highcost wheat production. As I told honorable members last year, competition is not between producers, or exporters, but between national treasuries.

Another critical area of the international wheat situation is the position of many less developed countries. The food needs of these countries are certain to increase. The famine in India this year has emphasised the gravity of this problem. Over the past two years this Government has provided India with nearly $16 million in emergency food aid, mainly wheal. The Government has taken the view that whilst the needs of the developing countries such as India must be recognised, the responsibility should not fall on the food exploring countries alone. The burden of meeting the legitimate food needs of these countries must be shared by all countries which have the ability to contribute.

Honorable members will appreciate that an international arrangement which adequately deals with all the issues I have mentioned is obviously not a simple matter to negotiate. However, the effort must be made and Australia has submitted a comprehensive and fully articulated proposal to the G.A.T.T. Cereals Group.

A satisfactory outcome of the negotiations requires commitments and obligations to be assumed by Governments which could affect their freedom of action in respect of national policies. It is only realistic to observe that such commitments are not easy for Governments to accept, and progress has, not unexpectedly, been slow. However, if the negotiations are to succeed the tempo will need to be increased because the United States authority to negotiate under that country’s Trade Expansion Act, which provided the initial impetus to the negotiations, will expire in June 1967. Meanwhile, the Bill before the House, providing for the extension of the current International Wheat Agreement for a further year, will no doubt command the support of ali honorable members. Australian participation in the successive International Wheat Agreements has consistently had the support of the Australian wheat growers. I commend the Bil! to the House.

Debate (on motion by Mr. Pollard) adjourned.

page 1289


Ministerial Statement

Minister for External Affairs · Curtin · LP

– by leave - Mr. Speaker, I wish to report to the House on my visit overseas, from which I returned last Sunday. In chronological order my tasks were to lead the Australian delegation to the annual Ministerial conference of the Economic Commission for Asia and the Far East in New Delhi, to meet Ministers of the Governments of India, Israel, Greece and Italy, to hold a meeting in Rome with heads of Australian diplomatic missions in Africa and to maintain our close consultation with Britain and the United States of America. I shall deal with this last matter first. Australia has always seen ils security in terms of world security, and to that end Australia has for long allied itself with Britain and the United States. The basic principles and objectives of their policies are for the most part shared by us. They are our allies because we find that they advance the principles and defend the causes we ourselves wish to uphold. For the sake of our own security and to ensure effective co-operation with our allies, both in shaping policy and in applying it, we are maintaining close and constant touch with them.

It was also part of my purpose while overseas to try to bring home to Western European Governments the importance to them of what is happening in the Far East, and in particular the consequences to them of Chinese Communist aggressive expansion against any of its neighbours. I felt all the more right to make this point because past Australian Governments have committed Australian servicemen and resources to the preservation of security in the world, particularly in Europe and the Middle East - notably the Fisher Government in 1914, the Menzies Government in 1939, and the Chifley Government in 1948 when it contributed part of the Royal Australian Air Force to the Berlin air lift. 1 did not presume to tell European Governments what they ought to do, but I advanced to them the idea that they cannot afford to be indifferent to what is happening in the Far East. The security of the whole world, and power relationships generally, would be damaged grievously by Chinese domination over South East Asia, or by Chinese nuclear adventures, or by hostilities against any of China’s neighbours, including the Soviet Union. Obviously, these are not matters that concern the Asian region only. The United States and the British Governments recognise that the maintenance of security in Asia by the defeat of Chinese Communist backed aggression fits into the maintenance of global security and is vital to their own defence. Australians can gain confidence from the fact that the United States has been prepared to commit large forces to repelling aggression in South East Asia. The British Government, too, has chosen firmly to maintain significant and effective forces east of Suez. This was set out in the White Paper which followed the recent British defence review. I was present last Thursday - a week ago today - ar the opening in London cf the new Parliament, when the Queen’s Speech reaffirmed this British policy. Today, honorable members will have read newspaper reports of further speeches by Mr. Harold Wilson and Mr. Denis Healey reaffirming the strength of British policy in the Far East.

These, and many other matters, were the subjects of my discussions in Washington and London. I was there not to reach decisions with those Governments but to continue the exchange of information and views which has been proceeding among us. Honorable members will know that within recent months we have had visits to Canberra by Mr. Denis Healey, the British Minister of Defence, by the Vice-President of the United States, Mr. Hubert Humphrey, with Mr. Averell Harriman, and by Mr. Cabot Lodge. My discussions in London and Washington were a continuation of these exchanges of views. While in Washington I conferred at length with Vice-President Humphrey, Mr. Dean Rusk, Secretary of State, Mr. McNamara, Secretary of Defence, a number of senior officials and some senators. In London, I talked with the Prime Minister, Mr. Harold Wilson, the Minister of Defence, Mr. Healey, the Secretary for Commonwealth Relations, Mr. Bottomley, two of the Ministers at the Foreign Office, the Foreign Secretary being absent at a Central Treaty Organisation meeting, and many other political figures and officials. These continuous discussions between our Governments, of which my visit was part and of which the regular activities of our diplomatic missions are another part, are designed to ensure that all the Governments are fully aware of the interests, activities, assessments, and policies of the others, so that each Government can make its own national decisions in the light of what it knows of what the others are doing and thinking and in the light of such common courses of conduct as may command general agreement.

In London, I need hardly say, there was some discussion of the provision of base facilities in Australia for possible use by British forces. This, as honorable members know, was the subject of discussion with Mr. Healey when he was in Canberra last January, and after those talks our Prime

Minister (Mr. Harold Holt) announced our attitude. The Australian Government’s position, in brief, is that we want Britain to maintain a strong military presence in the Far East, and specifically in Singapore. We believe that this presence is not merely accepted but actually welcomed by Singapore and many others in the region. And we believe, too, that a British military presence on the mainland of Asia is a source of confidence to the peoples of nearby countries, quite apart from its direct practical contribution to security. While that is our basic view, nevertheless the adequacy of existing defence facilities in Australia, which is always under review from the point of view of Australia’s own requirements, is being examined also in the light of possible British requirements and availabilities in certain contingencies. So Mr. Healey and I gave some thought in London to what had already been done along those lines since his visit here in January and we made some progress on the next steps to be taken. The Secretary of the Australian Department of Defence, Sir Edwin Hicks, was with me during this part of my talks.

The Australian Government, of course, does not think solely in terms of the United States and Britain when planning and executing its defence and foreign policy. The strength of Britain and the United States and their world-wide commitments cast these two nations in a special role, but all the countries of the region have a part to play. No policy could be soundly based that did not secure wide participation and accord from the region itself. So the Australian Government has been maintaining its contacts with South East Asian countries. Last December, for example, I visited the Philippines, Cambodia, Laos, Vietnam, Thailand, Malaysia and Singapore. Earlier in the year, I visited Burma. In London last Thursday I had a further talk with the Prime Minister of Singapore, Mr. Lee Kuan Yew. The Prime Minister of Australia in his present overseas visit to our forces is talking to the Governments of Singapore, Malaysia, Thailand and Vietnam. The Prime Minister of Thailand, accompanied by the Foreign Minister and the Minister for National Planning, visited Australia in February. The South East Asia Treaty Organisation Council will meet in Canberra from 27th June. I give these examples - and I could quote others - to show honorable members that, apart from our regular diplomatic contacts, discussions at a ministerial level have been proceeding with our South East Asian neighbours, and moreover they have not been limited to our treaty partners.

Nor does the Australian Government think only in military terms when considering the security of the area. In the long run, security itself is dependent on a healthy economic, social, and political life and on co-operation among the countries of the region. Military measures are necessary to provide a shield behind which economic development can take place and national independence can be consolidated. But the military measures, which first must be successful, could prove in vain if progress is not made politically and economically. Consequently, Australia is contributing to economic development and stability in Asia in various ways. I mention only a few. We contribute through the Colombo Plan, by special measures such as our two big gifts of grain to India, our flood relief for Indonesia, our annual grants to help stabilise the currency in Laos, our contributions to the Mekong River project and by participation in various multilateral funds. As soon as the ratification procedures are completed by the various countries, and the measure is before this House, Australia will be a foundation member of the new Asian Development Bank, to which we are contributing SUS85 million. That is an indication of what we are doing on the nonmilitary side to advance economic, social and political welfare.

I led the Australian delegation at the conference of the Economic Commission for Asia and the Far East in New Delhi towards the end of March, where many subjects in this field were discussed, including ways of developing intra-regional economic cooperation. The meeting was successful and practical. In addition it afforded me an opportunity - a very good opportunity - for private discussions with Ministers from Asian countries responsible for economic development programmes and economic co-operation. I should like to say to the House that, having attended this Conference and having talked to the representatives of other countries in the region, I was greatly encouraged by the repeated examples of the way in which Australia, as a regional member of E.C.A.F.E., is gaining the respect of its neighbours, establishing its own identity among them as a friendly and co-operative nation and joining with them in common enterprise for common good.

I spent two days in New York, primarily on United Nations matters. I talked with the Secretary-General, U Thant, and senior members of the Secretariat, and also with a number of representatives of other countries. Once again, my talks ranged widely. Before I leave the general subject of consultations and co-operation, particularly in regard to the security and development of Asia and the Western Pacific, let me add that I will be paying a short visit to New Zealand at the end of next week to complete this round of discussions and to continue the exchange between the two governments of views and information.

page 1292


Naturally Vietnam took a prominent part in my discussions overseas. The size of the military operations and of the United States’ own military role, and the fact that Australia, loo, is making a significant contribution, made it desirable and natural that the course of events in Vietnam should bulk large in any discussions of Asia and the western Pacific. In addition, during my absence from Australia, the internal political developments in Vietnam made it opportune to discuss their implications with other countries associated in the common effort in Vietnam. Regarding those internal political developments, 1 submit that we have to distinguish between the basic element in Vietnam and current developments which are not necessarily basic. The basic element is that the Republic of Vietnam is being subjected to aggression and subversion, directed from and based outside the country and this is part of an expansionism radiating from Peking.

Dr. J. F. Cairns. - Rubbish


– That is a fact of the situation which 1 am sorry to see that the honorable member for Yarra (Dr. J. F. Cairns) is so blind as to deny.


– Order! The honorable member for Yarra will remain silent. Interjections are out of order.


– Australia is helping to resist that expansionist aggression, at the request of the Government of Vietnam. But what is at stake is more than Vietnam:

It is security in the region - indeed, as I have argued, of the whole world; what is at stake is not only security, it is the right of each nation to maintain its independence; what is at stake is the eventual establishment of conditions for living with Communist China by indicating that aggression will meet common resistance. The outcome in Vietnam will affect, not only the future of Vietnam, but the future of all southern Asia.

These basic elements remain, they are still the same, despite what has been happening inside the political arena in Vietnam. I shall not comment in detail on those happenings, as it is primarily for the Vietnamese themselves to work out what they want. But it is interesting to see the degree of political expression and political action that exists in the South, for we know that anything in the North remotely resembling that expression of dissent would have been ruthlessly suppressed and those involved would have been destroyed. The principal elements in the recent political demonstrations and manoeuvrings have not been asking that the Republic of Vietnam surrender to the Communists. Far from it. They have been seeking power or influence within the framework of a non-Communist State resisting aggression and guerrilla subversion.

The search for a peaceful and just outcome of the hostilities continues. The outcome must be just. North Vietnam and those associated with it have not responded to any attempts - and there have been many - by the United States and others to open the way to discussion. So South Vietnam and its allies continue to resist the guerrillas and the regular North Vietnamese forces infiltrated into the South: and so the bombing of the North continues. The North Vietnamese would naturally like to limit the fighting to the South, where their underground has been practising terrorism, sabotage and open warfare, but the bases in the North from which aggression comes cannot be allowed to remain immune. They have brought themselves into the war by being used for the purposes of war. The bombing of the North is a response to what has been done for years past against the South in southern territory. The objective of the bombing is to interfere with the flow of supplies and forces from North Vietnam into the South. The operations have so far been conducted with restraint. It is not our objective to destroy North Vietnam, either physically or as a regime. The objective is to repel aggression and to enable the people in the South to choose and practise their own form of government, free from outside coercion.

As I have said in this House on several occasions before, the big question is future relations with Communist China and its place in the region. This is not to be disposed of simply by recognition of Peking or its admission to the United Nations. These are only aspects of the bigger question of relations with China.

I am quite sure that a successful approach to better relations cannot be made by surrendering to aggression or threats. Indeed, if the United States and the rest of us were to surrender to aggression and threats, Peking would be encouraged to push for more, and the hope and resolution of other countries in the region would be impaired. What we are attempting is delicate and dangerous. Wc are attempting a large but still limited response to aggressive expansionism; but passivity or retreat on our part would be even more dangerous.

page 1293



During my visit to New Delhi I talked with the new Prime Minister, Mrs. Indira Gandhi, before she left for the United States. I told her she had the good wishes and sympathetic understanding of the Australian Government and all the Australian people in the heavy task she has shouldered. India has to cope with a rapidly growing population. It has a persistent food shortage, which was aggravated last year by a severe and widespread drought. India is determined to industrialise itself, to promote literacy and higher education, and as far as possible to raise living standards. All these immense tasks are being pursued within the framework of parliamentary democracy, with freedom of speech and the rule of law. They extend beyond the boundaries of India and it is most important that they should succeed in India. One of the objectives of Peking when it attacked India was to obstruct and if possible render impossible this combination of democracy and economic development which offered to the countries of Asia an alternative pattern to the authoritarianism of Communist China.

It is most important that China should not succeed in its attempts to make India fail, and we should continue with our support to enable India to succeed. Australia recently gave India as a gift SA8 million worth of grain - our second big such gift - and we are continuing other forms of assistance. I hope many other countries of the world, particularly in Europe, will assist in India’s great task of establishing a sound economy and advancing its people.

In addition to calls on the President and Vice-President of India and my talk with Mrs. Gandhi, I talked with many Indian Ministers, including the Minister of Defence, Mr. Chavan, and the Minister of Education. Mr. Chagla, as well as a number of persons concerned with economic planning and economic development. With the Minister of Education, I discussed an expansion of educational and cultural exchanges and cooperation between our two countries. Both the Indian and Australian Governments attach importance to this. I also had many friendly and fruitful talks with the Indian Minister of External Affairs, Mr. Swaran Singh, whom I had had the pleasure to meet on several previous occasions. Altogether, I appreciated deeply the readiness of the Indian Ministers to discuss frankly all matters of common concern and to give me their confidence. At the conclusion of my visit, on 29th March, the Indian Minister of External Affairs and I issued a joint public statement, which I believe becomes something of a landmark in our relationship. I should, therefore, like to present it to the House. The statement, after reciting the circumstances of our discussions, continues as follows -

These discussions held in a frank and friendly atmosphere have served not only to acquaint the two Governments with each other’s point of view on various matters of national and international concern but have also helped in promoting understanding and strengthening the friendly relations already existing between the two countries. No particular negotiation was contemplated in these ministerial talks. The purpose was to reach a better understanding by each of the two Governments of the viewpoints of the other and to exchange information about the problems each country faces in world affairs.

The talks were held on the basis that India and Australia each has an interest in the maintenance of both countries as independent progressive nations and also in the advancement at the whole of the region of South and South Bast Asia and in the preservation of the national independence of the Stales of that region.

The Ministers discussed the threats to peace in Asia and particularly those resulting from the aggressive policies of the Peoples’ Republic of China of which India has already been and continues to be a victim.

It was explained on behalf of India that they would carry out the terms of the Tashkent Agreement. Hopes were expressed by the Ministers that there would be a good outcome from the implementation of the terms of the Tashkent Agreement.

Tt was accepted in the discussions between the Ministers that Asia faced vast and urgent tasks of reducing want, of finding the best means and methods of strengthening the economies of Asian countries and of assisting beneficial social changes. In these tasks the co-operation of countries of the region with each other and with non-regional countries would be needed and it was recognised that substantial non-Asian assistance was required. Nevertheless any lasting progress would have to be the result of Asian decisions on the use of Asian resources, both human and material; and each country of the region must be able to shape and maintain its own political system and make its own political judgment free from any coercion or subversion from outside.

Both the Ministers agreed that the situation in Vietnam was a matter of grave concern and that notwithstanding the great difficulties inherent in the situation, efforts should be continued to find a basis for talks so that a peaceful and just solution of the problem in accordance with the Geneva Agreements may be found.

During the talks, particular attention was given to the relationship between India and Australia. They revealed the remarkably close understanding by both the countries of the problems of Asia and a clearer appreciation of the possibilities that exist for working together more closely for the common good. It was agreed that both Governments would continue close co-operation in this regard. India and Australia are fellow members of the United Nations, of the Commonwealth and of a number of other international agencies including Regional Organisations, and when ratification processes are completed they will become major regional contributors of capital to the Asian Development Bank. The Australian Government has taken a friendly imprest in India’s efforts to build up her economy and has all along given substantial help. The Government of India particularly appreciated the prompt and generous assistance offered by the Australian Government to help tide over the current food difficulties.

It was agreed that increased cultural exchanges would offer further opportunities for closer constructive friendship between India and Australia. Already there has been, during the past decade, increasing cultural co-operation with exchange of students and scholars, participation in joint undertakings in the fields of science, medicine, agriculture and education, visits by artists and the study of the literature of each country. Both Ministers agreed to give immediate attention to developing further means by which these cultural exchanges may be usefully increased.

That ends the joint statement by the Indian and Australian Ministers for External Affairs. I think it shows a very large measure of agreement, both on purpose and method, between our two countries.


– A good deal is new. As a clear statement, for the first time, of the points on which the Governments have an identical view and common purpose, I think it represents quite a landmark in our relations.

page 1294


In Rome from 4th to 6th April I held a meeting with heads of Australian diplomatic missions in Africa to review the problems of Africa and Australia’s interests there. This vast continent now contains many independent states, members of the United Nations, many of them members of the Commonwealth; and Australia has increased its diplomatic representation by adding to the older embassies in the United Arab Republic and South Africa, four newer missions in Accra, Lagos, DaresSalaam and Nairobi. At the meeting of our heads of mission the opinion was expressed that there is an increasing desire by most African governments to give priority to their domestic tasks of economic development, education, and political evolution. Unfortunately at present this desirable development is hindered by the continuing racial tensions principally affecting Rhodesia, the Portuguese colonies, South Africa and South-West Africa.

This, however, is by no means the whole of the African story. There are other tensions in the continent and above all there are the underlying problems of economic and social needs in a continent whose natural resources are unevenly spread and in some places narrowly limited and where financial, technological and administrative capacity are still insufficient.

The Rome meeting has added greatly to the Government’s appreciation of the problems in this sphere of our external affairs and of the factors to be taken into account in shaping our decisions.

The most urgent problem in Africa is Rhodesia. While in London I had good talks with the Prime Minister, Mr. Harold Wilson, the Secretary of State for Commonwealth Relations, and with others on this subject. The Australian Government regards the United Kingdom as having sovereignty over and responsibility for Rhodesia, and any resolutions adopted by the United Nations Security Council have been adopted by or at the request of the British Government. It follows from our belief that responsibility for Rhodesia rests with the British Government that what we are doing in regard to Rhodesia is at the request of the British Government. Australia is imposing economic sanctions on Rhodesia to the extent of 93 per cent, of our former imports. While in London 1 took the opportunity of informing Mr. Wilson that in our view there should be no resort to force in Rhodesia. I also made our position on this clear to the SecretaryGeneral of the United Nations and to the United States representative on the Security Council.

page 1295


Finally I say some words about Europe. I found among various European leaders considerable uneasiness about the recent statements by President de Gaulle. It was not simply that’ the military structure of the North Atlantic Treaty Organisation was being affected; a delicate political balance in Western Europe was also being upset. I found, too, considerable discussions going on in Britain, cutting across party lines, about the possibility of Britain entering into the European Common Market’. I would repeat the phrase I have just used, that these discussions cut across party lines. There were some in all parties who were talking on this subject. Reference was made to the subject in the Queen’s Speech last Thursday to Parliament in London. I quote from the Queen’s Speech one passage -

My Government will continue to promote the economic unity of Europe and to strengthen the links between the European Free Trade Association and the European Economic Community. They would be ready to enter the European Economic Community provided essential British and Commonwealth interests were safeguarded. They will work for tariff reductions under the General Agreement on Tariffs and Trade and for an expansion of Commonwealth trade.

There are clearly many obstacles in the way of Britain’s entering the European Common Market. Since this idea was first mooted some years ago, Australia’s own capacity to cope with a new situation has improved. Under the impetus of my colleague, the Minister for Trade and Industry (Mr. McEwen), Australia has done a lot’ to diversify the markets of its products. I shall not attempt now to give in a few words Australia’s attitude to possible entry by Britain into the Common Market, but I would, without attempting that task, make a few simple points.

We in Australia have all along taken the position that, whilst the decision to go in or to stay out is one for Britain to make in the light of its own interests, we would press for special arrangements to be made for those particular items of Australian exports to Britain which would be vulnerable if there was a change in the present conditions of entry to the British market. We want the European market to be outward looking and to help bring about a widening of world trade, not a contraction of world trade or the limitation of access to the European market to selected countries. We hope, too, that the terms of any British membership would not constrict its world role, or impair its political relations with Australia and other Commonwealth countries. Saying this, however, we recognise the importance t’o ourselves of the integrity of Western Europe and the strengthening of the British economy. Indeed I expressed to British Ministers the view that one point that we would wish to see demonstrated was that entry to the Common Market would in fact strengthen Britain. Throughout my discussions in London I stressed the global context’ of so many problems, even those that seem regional. We in Australia cannot shut our eyes to Europe: European countries cannot turn away from what’ is happening in Asia.

In conclusion I wish to express my appreciation to the Ministers of other Governments for their readiness to afford considerable time to me for these conversations and to talk with me in an atmosphere of trust and confidence. 1 have not had time to refer in detail to the very useful and informative discussions I had in Israel, in Greece and in Rome with the Ministers of those Governments, but they too were particularly valuable and enlightening. I was greatly assisted in these talks by our ambassadors and high commissioners at the various cities visited and by the permanent head of the Department of External Affairs, Sir James Plimsoll, who accompanied me throughout this tour of duty. 1 believe that our foreign policy is developing on a foundation of confidence and respect - a foundation which is laid down by representatives at all levels who over the years have shown that Australia is worthy both of confidence and of respect.

I present the following paper -

International Affairs - Ministerial Statement, 28th April 1966- and move -

That the House take note of the paper.

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

page 1296


Ministerial Statement

Mr Malcolm Fraser:

– by leave - I am now making a further statement concerning the case of Gunner O’Neill and the related cases of Gunner Willey and Major Tedder. Honorable members will recall that I made a statement in the House on 16th March 1966 concerning the case of Gunner P. G. O’Neill. As I indicated on that occasion, Gunner O’Neill went absent without leave when rostered for operational guard duty on 16th January 1966. When the case was heard by his Commanding Officer, he was awarded 21 days field punishment and 21 days forfeiture of pay. On 17th January Gunner O’Neill failed to attend a field punishment parade and later the same day refused direct orders to attend a routine administration parade. He was then placed under close arrest and was confined in a weapon pit which afforded him protection from enemy action, shelter and reasonable privacy.

Gunner O’Neill was then court martialled on two charges relating to his failure to attend the field punishment parade and his refusal to obey direct orders to attend an administrative parade. He was found guilty on both charges and sentenced to six months’ detention and discharge from the Army. On the advice of the Judge Advocate General, the conviction on the first charge relating to failure to attend the punishment parade was quashed and the conviction on the second charge relating to failure to attend an administrative parade, to which he pleaded guilty, was confirmed. In view of this, the sentence awarded Gunner

O’Neill was reduced to 90 days detention and discharge from the Army.

It has been suggested that, in some way, this incident arose out of the article entitled “ It’s a Sick War “ which appeared in the Press on 28th December 1965 and which was stated to be a letter from Gunner O’Neill to his parents. I should tell honorable members that the incidents on 1 6th and 17th January were not isolated ones and that, in fact, something very similar had occurred early in November 1965. An examination of the court martial papers will reveal that on that occasion Gunner O’Neill was awarded seven days field punishment for breaking out of barracks at night, and on two occasions during his period of field punishment had refused to attend defaulters’ parades. His case was handled sympathetically and his troop commander did, in fact, persuade him to carry out his punishment.

As honorable members know, Gunner O’Neill is at present serving his detention at the Military Corrective Establishment, Holsworthy. Subject to suitable conduct, he is still eligible for remission of the maximum of 22 days of the 90 days detention awarded him. If he earns this full period of remission, therefore, he will be due for release on 11th May. I should explain that the sentence being served by Gunner O’Neill relates only to the charge to which he had pleaded guilty at his court martial. He could not seek a review of this sentence by way of an appeal to the Courts Martial Appeal Tribunal since, under the relevant law, he may only appeal against his conviction and, as J have said, he had in fact pleaded guilty to the charge.

Provision is, however, made in the Australian Military Regulations for any person convicted by court martial, who considers himself aggrieved by the finding or sentence, to forward a petition to the appropriate authority - in this case the Adjutant-General - seeking a review of the finding or sentence. Gunner O’Neill did in fact forward such a petition seeking a review, not of the period of detention to which he was sentenced but that part of his sentence relating to his discharge from the Army. As the House will be aware, this petition has been dismissed.

I want to mention Major Tedder and the incident concerning some of Gunner O’Neill’s fellow gunners, but before doing so I feel forced to emphasise that Gunner O’Neill went absent without leave when rostered for operational guard duty in South Vietnam. I cannot stress too strongly that the maintenance of discipline in the field is of the greatest importance as the lives of soldiers may depend on their response to the orders of their superior officers. In the case of Gunner O’Neill, his absence without leave when rostered for duty under operational conditions was a serious offence. One has only to consider the casualties and damage which have resulted from Vietcong infiltration of major airfields and installations in Vietnam to appreciate this.

This incident took place in the field in an operational environment where normal means of restraint, such as a guard room with cells, was not available. In the absence of a guard room or compound, the other action open would have been to mount a special guard over Gunner O’Neill. This would have meant diverting the guard from their normal operational duties. As I have previously indicated, this was not the first time that Gunner O’Neill had ignored his responsibilities or refused to accept discipline, and it would have been wrong to allow a recalcitrant prisoner to disrupt the operational capability of a unit. The Battery Commander therefore took steps, which he felt were reasonably necessary, to confine Gunner O’Neill to maintain essential discipline and, at the same time, to afford him reasonable privacy and protection.

I turn now to a charge laid against a fellow gunner of Gunner O’Neill’s battery. Three soldiers of this unit were alleged to have been involved in an incident concerning Gunner O’Neill at Bien Hoa on 4th March 1966. A charge was preferred against one of the soldiers, alleging, and I quote, “ conduct to the prejudice of good order and military discipline in that he, at Bien Hoa on 4th March 1966, at approximately 9.30 p.m., did interfere with a picket, namely Gunner Peter Gerard O’Neill, preventing the said gunner from performing his duties efficiently.”

In view of all the circumstances, Gunner Willey was tried at headquarters, Australian Army Force Vietnam, and not by Major Tedder. The charge arose from an incident when Gunner O’Neill arrived late for sentry duty to relieve another soldier. This caused resentment among several members of the unit and culminated in an exchange of blows between Gunner O’Neill and another gunner. In the light of the circumstances and the evidence, the charge against Gunner Willey was dismissed by the officer who heard the case and there were no grounds for proceeding with charges against the other two soldiers.

I turn now to the battery commander, Major Tedder, whose court martial took place on 9th April 1966. Following the evidence given at Gunner O’Neill’s court martial, the commander of the Australian Force in Vietnam decided to lay a charge against Major Tedder in relation to the circumstances in which Gunner O’Neill was handcuffed to a fixed object, namely a star picket. At Major Tedder’s court martial, his defending officer submitted what is known as a “ plea in bar of trial “. The grounds for the plea in bar were that the offence has been pardoned or condoned. It was the contention of Major Tedder’s defending officer that his offence had been “ pardoned and condoned ‘ by competent military authority in that he remained in command of his unit during operations after the date on which his alleged offence took place. The doctrine of “ condonation “ in this sense is peculiar to military law. In the event, the court decided on the evidence before it that the offence, if any, had been pardoned and condoned and for this reason the court martial of Major Tedder did not proceed. The proceedings of Major Tedder’s trial have been considered by the Judge Advocate General who fully supports the findings and, in the light of this advice, the Adjutant-General has confirmed that the plea in bar was proved.

Perhaps I should explain how Major Tedder came to be left in command of his unit during operations after the facts had been made known to the area commander. During the period January to March, throughout which these incidents took place, 105 Field Battery under the command of Major Tedder had been almost continuously engaged in or preparing for a variety of active operations against the Vietcong. The relevant ones were: Operation Crimp from 6rh to 14th

January - a search and destroy operation; operation Roundhouse from 4th to 9th Feb.rurary - a search and destroy operation in War Zone D; operation Mastiff from 21st to 26th February - a divisional operation in the Iron Triangle Area; operation Phoenix from 28th February to 2nd March in which the Battery was used to support search and destroy operations; and operation Silver City from 9th to 24th March - a divisional operation deep in War Zone D.

Having regard to the operational situation and the probable effect on unit efficiency of removing Major Tedder from his command, it seems clear that the Commander Australian Army Force decided that the efficiency and safety of the battery should be the prime considerations and that Major Tedder should complete operation SILVER CITY in command of his battery. I would hope that the House would not criticise such a decision.

It is a matter for regret that these incidents should have occurred and that, in view of the publicity which has been given to them, it has been necessary to comment in some detail. All the cases, I would stress, were dealt with by the normal processes of military law and the circumstances have been thoroughly probed. In the case of the two courts martial, the subsequent action has been taken by the Army on the advice of and after review of all the evidence by the Judge Advocate General, an experienced member of the New South Wales bar.

I present the following paper -

Cases of Gunner O’Neill, Gunner Willey and Major Tedder - Ministerial Statement, 28th April 1966- and move -

That the House take note of the paper.


.- This debate is on the ministerial statement concerning Gunner O’Neill, Gunner Willey and Major Tedder. The Opposition agrees that it is a pity that this matter has had to come before the House. However, it is a matter of great public concern and it had to be ventilated. The debate must, of necessity, hinge on the case of Gunner O’Neill and his battery commander, Major Tedder. The Opposition is not so satisfied as the Minister for the Army (Mr. Malcolm Fraser) about the whole conduct of this incident. We believe that much of the trouble has stemmed from the newspaper article to which the Minister referred in his statement. We should remember that Gunner O’Neill has always been active in defence. He joined the Citizen Military Forces and then the Regular Army. He was posted to Vietnam. He has always stated, and in the court martial proceedings went on record as saying, that he attached great pride to being a member of the armed forces. He said he was proud to be serving in the cause for which he was fighting in Vietnam and that his deepest wish was to be allowed to serve out the remainder of his term in the Regular Army in Vietnam.

What then is the cause of the present situation? We do not dispute the record of incidents in November of last year to which the Minister referred, but I believe that that alone was not responsible for the serious charges that were laid against, and the very severe punishment that has been meted out, to Gunner O’Neill. As the letter has been mentioned by the Minister, I think it is essential that I place its contents on record in “ Hansard “. Gunner O’Neill forwarded a letter to his parents in Victoria. His father took the letter to a newspaper. Gunner O’Neill bad no part in the taking of the letter to the newspaper or in its publication. The article in he newspaper is headed: “ A letter home from Vietnam - Digger writes: ‘ It’s a sick war ‘ “. The article states -

This is a letter written to his parents by Gunner Peter O’Neill, 105 Bty. R.A.A., Australian Forces, Vietnam.

It was sent to the Sun by his father, Mr. J. O’Neill, of Terang.

The Sun wants to make it clear that the letter was not sent directly to us by Gunner O’Neill. This would have contravened Army regulations. “It’s a sick war” … I quote the words of an American friend of mine as we discuss how practised and expert the Vietcong are at improvising.

Something which the people of this country have been doing for centuries.

Some of the things we discussed were incidents like this one which happened at Da Nang.

The Marines called her “Soda Girl”. Each afternoon she was there peddling cold drinks to the soldiers near her village.

She would smile and walk up to a group saying, “ You buy. You buy?”.

She looked about nine years’ old - a cute kid, the Marines thought.

One hot day as eight thirsty men clustered about her she tossed her head, laughed, and fingered something tied to her waist.

It was a bomb - crude, but effective, for it took six Marines with her.

They die like that every day here.

In jungles. But the bars, and even tile streets of Saigon, South Vietnam’s bustling capital city, are not safe.

A bottle of soft drink may contain acid. Fresh fruits may be injected with snake venom. Ice from drinks may be tilled with slivers of glass.

People here call it a “ sick war “. Sadistic. Sneaky. But effective.

Not long ago a Marine walking on a footpath near Da Nang was cut down by the steel jaws of a giant bear-trap, lt was 2 ft. wide; the teeth 3 in. long.

Four companions were unable to pry open the rusted spikes.

Another time a trooper was shot in the stomach by a common rat trap. A thin trip-wire triggered the spring which struck a 30-calibre shell aimed hip high.

No one is safe.

No lime is safe.

Even the cautious can die. And they do.

There is another half column in the article dealing with similar incidents, lt is not a pretty article. It is not an article that would encourage recruits into the Services. But Gunner O’Neill did nothing wrong in sending that letter home. There is no denying the publication of the article. The letter was of concern to his father, who took it to the Press. It was ultimately published. lt has been stated - and I believe rightly st! - that the main contents of the letter had already been published in the United States Army publication “ Stars and Stripes “. If the United States Army authorities saw nothing objectionable in telling their personnel the truth about this war, the Australian Army authorities should not hesitate to let the Australians know the truth about it. One can understand the concern that the Army authorities must have felt when the letter was published and when the report went back to the unit. After the letter was published, things seemed to get a bit rough for Gunner O’Neill - perhaps understandably. The officers and men made it clear to O’Neil that they did not appreciate the letter being published. They made it clear that he would be copping it in the neck.

As the Minister has stated, on 16th January, Gunner O’Neill was absent without leave. The Opposition makes it clear that it does not in any way condone Gunner O’Neill’s action. We agree that there must be discipline in the defence forces. But just as there must be discipline, there must be justice administered to all ranks. On 16th January, Gunner O’Neill was absent without leave and was subsequently charged. I would like the Minister to tell me how many men at this base have been absent without leave whilst on picket duty. Is it not a fact that this base is not treated as seriously as are some of the other bases? However, this would not condone anyone’s action in not being on duty, lt would be interesting to know how many men at this base have been absent without leave and how many have been charged for this offence. Is it not a fact that quite often other personnel, including Gunner O’Neill, have had to carry out duty when other men have not returned? We will ask the Minister to ascertain this information. As I have said, even if picket duty at this base was treated casually, that does not excuse O’Neill, but it should, at least, be a factor in considering his punishment.

As a result of his absence without leave, Gunner O’Neill was paraded before Major Tedder and charged with being absent without leave. It was at this hearing by Major Tedder that the main trouble seems to have arisen. The transcript shows that at this hearing Major Tedder asked O’Neill whether he was prepared to accept punishment by Tedder or whether he would elect to go before a court-martial. O’Neill claims on oath that he consistently asked that he be dealt with by court-martial. There is not much dispute about that fact. Major Tedder himself agrees that O’Neill did elect to go before a court-martial. O’Neill says that Major Tedder asked him: “ Do you wish to take my punishment or elect trial by court martial? “ To this O’Neill replied that he desired a court martial.

At this point, if Major Tedder had carried out Army rules, he would have immediately remanded O’Neill so that the necessary steps could be taken for the holding of a courtmartial. But instead Major Tedder decided that he ought to try to talk O’Neill out of his decision. There is no dispute on this point. The transcript is clear on it. Major Tedder himself admits that he could have said to O’Neill: “ You are guilty and have no grounds for a court-martial trial.” The transcript shows that O’Neill was consistent on this point. He would not accept punishment from Major Tedder. He elected to go before a court-martial. Major Tedder decided otherwise. It was then that he handed out 21 days field punishment to Gunner O’Neill. O’Neill said then, and consistently thereafter, that he would refuse to accept the punishment, which was illegal. I think that that hearing is best described in the words of the Judge Advocate-General who, in summing up at the later courtmartial, said -

In any view the orderly room was conducted in a manner which was in contravention of the provisions of the Army Act.

We have not said that; those words are on record in the court martial. It is clear that at the orderly room where O’Neill was originally sentenced proceedings were not conducted in accordance with Army regulations. O’Neill was subsequently ordered to attend parade and to undertake his field punishment, but he failed to do so. Major Tedder substantiated O’Neill’s case by stating the he recalled O’Neill saying: “I will not accept field punishment”; but Major Tedder said that his memory was hazy about it all. Major Tedder’s memory was hazy. It is remarkable that an officer of such long training as Major Tedder should not be clear in his recollection of this case. He was on oath, as was Gunner O’Neill. O’Neill’s evidence was concise, clear and consistent whereas, unfortunately, Major Tedder’s evidence was rather hazy. However, he did not substantially contradict O’Neill’s version.

As honorable members have been told, O’Neill was subsequently taken to a weapon pit and handcuffed to a star picket. For seven days he was so handcuffed during the day and at night he was taken to the orderly room where he was handcuffed face downwards. When the court martial proceedings were reviewed by the Judge AdvocateGeneral the second charge relating to O’Neill’s failure to attend a field punishment parade was quashed, although the other conviction stood. In respect of that conviction, however, the sentence was reduced from 6 months to 90 days detention with O’Neill then to be dishonourably discharged. Since then O’Neill has suffered solitary confinement and has been placed on a bread and water diet for several days.

The Opposition feels that Gunner O’Neill’s severe punishment is not in keeping with his offence, despite a previous offence committed in November. He has already been illegally punished. His original orderly room hearing, at which .vlajor Tedder ordered him 21 days field punishment, was not conducted in accord with Army orders. O’Neill has been the victim of an unfortunate set of circumstances. He wishes to soldier on. I feel that these unfortunate happenings would not have taken place had his letter to his parents not been published. Naturally, Army authorities resented the action of O’Neill in writing such a letter home, but in so doing O’Neill committed no crime. True, the newspaper publication would not help recruitment for the Army, but as I said earlier it appeared in a United States publication, and Australia should not hide the truth from its people.

Since this incident Major Tedder has faced court martial for the illegal punishment of O’Neill. In Major Tedder’s case the Army was able to go back to 1807, to the days of the Duke of Wellington, to obtain a precedent that made it appear that justice was b=ing carried out. Major Tedder was acquitted. The Opposition requests that the same sympathy and understanding be meted out to Gunner O’Neill as was meted out to his officer. Gunner O’Neill has already stated that he is proud to be a member of the armed forces and proud to be serving in the cause for which he was fighting. He said -

Deep in my hean i wish to serve out the remainder of my term in the Vietnam war but I am not sure I can do it successfully in the 103th Field Battery.

We ask that Gunner O’Neill’s wish be granted and that he be allowed to serve on in a cause in which he believes. The Government is conscripting inexperienced boys who do not want to go to Vietnam to fight there. The Government should allow Gunner O’Neill, who wants to continue to fight on, to return to this war. I ask honorable members to bear in mind that O’Neill was not in any real trouble until he informed his parents of the conditions in Vietnam and the newspaper published his letter. I ask honorable members to remember the words of the Judge AdvocateGeneral in commenting on the hearing of the charge against O’Neill by Major Tedder- the orderly room was conducted in a manner in contravention of the provisions of the Army Act.

I ask honorable members to recall Major Tedder’s refusal to allow O’Neill to face a court martial on the original charge after Major Tedder had asked O’Neill whether he wanted a court martial and O’Neill had elected to face court martial.

Unfortunately the Australian forces rely on United Kingdom procedure which the United Kingdom forces do not use now. The Australian Government should have produced by now an Australian disciplinary code for Australians, and we ask the Government to get on with the job. If it does not do so we give the pledge that when the Opposition is returned as a government later this year or early next year we will produce a disciplinary code for our defence forces, compiled by Australians for Australian forces. We feel that Gunner O’Neill has already suffered enough. We make no comment on Major Tedder’s case. Mistakes have been made but we believe that justice should always be meted out with mercy. We do not object to the decision in Major Tedder’s case. Conditions are strange in Vietnam. It is a war which is technically not a war. We say that both persons concerned - Major Tedder and Gunner O’Neill - should be treated alike. Discipline is needed, but so is justice for all. Accordingly I propose an amendment to the Minister’s motion. I move -

That all words after “That” be omitted with a view to inserting the following words in place thereof- “ in the opinion of this House it would be in the interests of the Army and of Gunner O’Neill that he be released from detention forthwith”.


– Is the amendment seconded?

Mr Whitlam:

– I second the amendment and reserve my right to speak to it.

Minister for Defence · Paterson · LP

.- The Parliament has listened to a rather lengthy statement, not the first, on this question of Gunner O’Neill.

Mr Calwell:

– It is not the last.


– I hope it will be the last, for the reasons I will advance. The statement of the Minister for the Army (Mr. Malcolm Fraser) sets out all of the matters attendant upon the question of Gunner O’Neill’s case, which has attracted the most extraordinary publicity, a good deal of it exaggerated, and which, of course, has been responsible for much misunder standing and for the generation of a good deal of feeling not entirely associated with the case. I am happy to know that the Opposition, in the person of the honorable member for Kingston (Mr. Galvin), admits this. It is quite right that the facts associated with this incident should be fully ventilated, particularly for the sake of those most intimately concerned with it - and I refer to Gunner O’Neill himself, to his parents and to Major Tedder particularly. It is regrettable that in ventilating this matter, which we should do, much notoriety has attached to Gunner O’Neill and, as a consequence, it has caused a good deal of suffering to him and no doubt to his family. We would seek to avoid this if we could.

Mr Pollard:

– Do the right thing and let him out.


– I will come to that in a moment. On the other hand, this suffering to which Gunner O’Neill has been subjected because of the publicity attendant on this case has simply added to the just punishment that attached to the offence to which, I remind honorable members, he pleaded guilty. The honorable member for Kingston read into the record the letter published in a Melbourne newspaper on 28th December. He said that Gunner O’Neill was not responsible for its publication. That is perfectly true, but one could hardly avoid the impression that the honorable member read the details of the letter with much relish, having in mind no doubt, in his own words, that it was the sort of thing that would not encourage recruiting.

It fits in very well with the attitude of the Labour Party on this matter. But we are not discussing this kind of policy. I want to know what the honorable gentleman was trying to prove by referring to the publication of the letter. Clearly, and mostly by implication, the honorable gentleman is trying to suggest that what happened to Gunner O’Neill since that time arose from the publication of the letter and that in fact he is being persecuted. If this were true I would like to go back and see what inferences are to be drawn from the behaviour of Gunner O’Neill on 30th October when he broke out of barracks and was awarded seven days field punishment. On that occasion, months prior to the publication of this letter, when there could be no indication 01 persecution arising from the publication of the letter, Gunner O’Neill also chose to refuse punishment. This was before the publication of the letter, lt is impossible to say that this refusal of punishment and, if 1 may say so, a number of minor incidents before this date affecting Gunner O’Neill, arose out of a sense of persecution because of a letter published in some cases almost twelve months after-

Mr Stewart:

– What soldier does not have minor offences?


– That is not the point. The honorable gentleman is complaining that the refusal of punishment by Gunner O’Neill arose after a sense of persecution had developed within him - a sense of persecution stemming from the publication of the letter. But here clearly is an indication of the general behaviour of Gunner O’Neill, indicating a state of mind before the publication of the letter.

The honorable member for Kingston strains our credulity a little when he tries to tell us that Bien Hoa is not a base where guard duty is taken very seriously. The fact is that the battery of which Gunner O’Neill was a member is deployed in defence of the airfield. Honorable gentlemen opposite have had some caustic things to say in various places, asking how it is that the airfield at Bien Hoa can be bombed at night. If it were true that guard duty was taken other than seriously at this base, how would these things happen? Honorable gentlemen opposite tell us that we do not really care about guard duty here. In the kind of purposeful war going on in Vietnam - a war that is characterised by most of the things referred to in the letter; one that is being fought by subterfuge, infiltration and so on - the most important thing in the Army is the attendance upon guard duty. The absence from operational guard duty of Gunner O’Neill is about the worst crime in the military book on this occasion. If fighting men are ever to have any peace of mind it will come only out of their complete knowledge that every man in the team is doing his duty effectively and well. The security of Gunner O’Neill’s team and of the force in Vietnam depends entirely on the willingness of every man in the forces to accept bis responsibilities and not to avoid them, as Gunner O’Neill did on this occasion Although the honorable member for Kingston has relied heavily on Gunner O’Neill being absent without leave from operational guard duty, the charge on which he was ultimately sentenced did not have immediate relation to this matter. He was dealt with for the deliberate absence from another parade altogether.

The honorable member quoted some of the evidence from the record. 1 do not propose to go through the minutes of evidence because time will not permit, but there is a good deal of confusion in the evidence as to whether Gunner O’Neill was denied a court martial on the first occasion. I think 1 might point out to the honorable gentleman that had Gunner O’Neill gone to court martial because of his absence from operational guard duty I have no doubt that the punishment meted out to him would have been more severe. I am confident that people experienced in these military matters share that view. I will return to that matter in a moment or two. The fact is that Warrant Officer Soxsmith. who gave evidence, agreed with Major Tedder that Gunner O’Neill did finally accept the commanding officer’s punishment. Having accepted the 21 days field punishment awarded by the commanding officer he then refused to front and accept that discipline.

Let me turn now to this allegation of persecution. The honorable member for Kingston has sought to attract some greater sympathy for Gunner O’Neill than he deserves on this occasion. The honorable member has tried to establish that the whole machinery of the Army was brought to bear in persecution of Gunner O’Neill because of an incident-

Mr Whitlam:

– The honorable member for Kingston never used the word “ persecution “. One of the Minister’s supporters used the word by way of interjection.


– The honorable member implied that Gunner O’Neill had suffered persecution. If the Deputy Leader of the Opposition (Mr. Whitlam) can draw any other inference from the words used by the honorable member for Kingston, then the meaning of English words has changed completely.

Two occasions are involved in this matter. One was in October 196S, when Gunner

O’Neill first refused to accept punishment of seven days. His troop officer had to persuade him to accept the punishment because if he had not accepted it, worse would have befallen him. Is it persecution when a troop officer persuades a guilty soldier to accept punishment, thereby saving him from further charges? On a second occasion, as I have pointed out, there is every reason to believe that the punishment would have been vastly more severe had not Major Tedder persuaded Gunner O’Neill to accept his commanding officer’s punishment. This is not evidence of persecution, as is suggested by the honorable member for Kingston. It is in fact evidence of complete sympathy for Gunner O’Neill in an effort to settle him in properly with the Test of his men. After the incident of October 1965 Gunner O’Neill was even moved to a new gun troop in the hope that a change in surroundings and perhaps a change of officers would rectify what was wrong with this soldier, but this move failed to be effective. There has been no victimisation. There has been only the most sympathetic help offered to Gunner O’Neill during all this time.

The point has been made that illegal punishment had been meted out to Gunner O’Neill. Technically this is true. This was admitted by Major Tedder. He manfully took the responsibility for it, although some people thought that a subordinate officer may well have been a little amiss in reading the regulations.

Mr Cope:

– A little?


– Well, let us look at the Rules for Field Punishment-

Mr Stewart:

– English rules?


– I will get around to that. The rules say -

Where a soldier on active service is guilty of any offence, it shall be lawful for a court-martial to award for that offence such field punishment, other than flogging or attachment to a fixed object . . .

The important words are “lawful to award “. It is not illegal to award such punishment. In association with that let me read the Rules for Field Punishment appearing in section III -

He may be kept-

That is, referring to the soldier - in irons, i.e., in fetters or handcuffs, or both fetters and handcuffs; and may be secured so as to prevent his escape.

Mr Daly:

– Shades of Port Arthur.


– Never mind whether this is Port Arthur over again; these are the rules. We are arguing whether there has been a departure from the .rules and the extent of that departure. True there has been a departure, but it would have been competent for Major Tedder to have secured Gunner O’Neill or to have had him secured to something vastly heavier than a star picket. Certainly a technical breach was involved, but the facts are that Gunner O’Neill was secured in a gun pit, he had privacy, he was protected against enemy action and he was visited almost every hour. He was asked whether he was prepared to extricate himself from this situation and to accept field punishment and on every occasion he refused. He has said that apart from this occasion, when he was secured for five days and not the twenty days that was talked about when this case first broke, he does not remember being ill treated.

Let me remind the House that we are not dealing with the case of Major Tedder because the honorable member for Kingston has expressly put that matter aside. We are dealing with the case of Gunner O’Neill. Nothing that has happened in relation to Major Tedder and nothing that has happened in connection with the illegal punishment - even if one admits it, as Major Tedder did and as we do - works to mitigate any of the serious offences committed by Gunner O’Neill for which he was ultimately punished.

There is a strong and simple tendency on the part of members of the Opposition to overlook completely the conditions existing in Vietnam. They purport not to realise that there is a difficult and confused situation in Vietnam while at the same time a purposeful war is being conducted. They try to consider conditions in Vietnam on the basis of our home environment, but things are not quite like that. What occurred on this occasion took place at a forward position, a place where no facilities for the proper detention of soldiers had been established. Happily, as I had cause to state in answer to a question a few days ago, there have been only a handful of minor, infractions amongst the whole of Australia’s commitment in Vietnam in a period of 12 months. This is a pretty proud record. However, the fact is that detention facilities were not available and in this kind of situation I doubt that anybody having a proper appreciation of the conditions, a proper appreciation of the responsibilities of Major Tedder and a proper appreciation of the conduct and mental attitude of Gunner O’Neill - much as I hate to say that - will quarrel with what was done on this occasion.

The doctrine of condonation to which the honorable member for Kingston has referred has long been a part of established military law, and for a very good reason. But in trying to convince us that there was no bother at all until the publication of a letter the honorable gentleman does not make any case whatsoever. This has been a particularly unhappy occasion. The soldier has suffered through notoriety and he has suffered through punishment. A battery commander, suffering under the stress of war, in a difficult environment, and in the absence of facilities has admitted that because of these difficulties he has committed what must be regarded by any thinking person as a minor breach, albeit a breach. The matters has been dealt with with every kind of thoroughness by the whole of the military legal machine. It has been carefully looked into and probed. Every aspect of the case has been made public, and despite what the honorable member for Kingston has said, nowhere in the evidence or elsewhere does there appear any evidence of persecution of Gunner O’Neill, but only of help and sympathy within the framework of the commanding officer’s first responsibility, which is to maintain discipline among his troops.

The honorable gentleman has had something to say about the code of military law and the need for it to be brought up to date. The Government acknowledges this. It has been working quite seriously along these lines for a considerable period.

Mr Daly:

– Fifteen years?


– Not for 15 years. Honorable members opposite should not believe everything they read in the Press, even what they put there themselves. The

Government has been exercising its attention on this, matter and it is making the most extraordinary efforts at this very moment to bring the military code right up to date. This will be done as quickly as it possibly can be done.

The Government will hardly support the amendment moved by the Opposition. It goes half way in trying to mitigate the punishment deserved by Gunner O’Neill. It is a political gesture of the poorest kind. It seeks to override essential military discipline, for which there are the best possible reasons, for some wretched political end. This House will hardly want to see itself constituted as some kind of court of appeal over the military tribunal. For that reason the Government will reject out of hand the Opposition’s amendment.


.- The Minister for Defence (Mr. Fairhall) is unjust both to the Army and to Gunner O’Neill in using terms such as “ persecution “ and “ vindictiveness “.

Mr Fairhall:

– I did not use the word “ vindictiveness “. Swallow your own medicine; I did not use that word.


– I thought I heard that the Minister had used that word. I say, then that the Minister for Defence is unjust both to the Army and to Gunner ONeill in using a word such as “ persecution “, which was not used by either of the two previous speakers. The Minister cannot excuse his own conduct and that of his colleagues by referring to a minor breach or a technical breach committed in attaching Gunner O’Neill to a fixed object. This action was a breach of the law. It would have been a breach of the law in any of the last three wars in which we have been engaged. It is shocking that a graduate of Duntroon should not be aware that this was a breach of the law. It is permissible to attach soldiers to fixed objects only to prevent them from escaping or harming themselves. There is no suggestion that Gunner O’Neill would have escaped, because the instruction to him was to take field punishment, in which case he would have been relatively mobile. There is no suggestion that he would have done himself harm. This was not a minor breach or a technical breach; it was a breach of the law, and every member of this Parliament, which makes laws or cj..j make laws in this matter, should make certain that people charged with the administration of the law know the law and correctly administer it. it is a poor thing to blacken Gunner O’Neill. This is a man of 20 years who was in the Citizen Military Forces previously. About 18 months ago he volunteered for the Australian Regular Army. Last September Major Tedder wrote to his mother and said -

Your son is a good soldier proving himself adaptable and enthusiastic.

In December the previous Minister for the Army (Dr. Forbes) wrote to O’Neill’s mother and said -

Me has overcome most of his problems and is settling down in his unit.

I was concerned when I read that he had been sentenced to three days on bread and water after arriving at Holsworthy Camp. I asked the Minister for the Army whether I might see him, and the Minister readily enabled me to do so. I had a long and free talk with Gunner O’Neill. I found him a young man who in my opinion is quite sound in body and mind. He bears no ill will towards Major Tedder or the battery sergeant-major. He bears no ill will towards the Army or towards the war in Vietnam. He is, one would think from the tests I was able to apply to him, a welladjusted young man and a soldier whom we ought to be able to use in this essential occupation at this time. The whole trouble has snowballed from the letter which appeared in the metropolitan newspapers on 28th December. Gunner O’Neill was entitled to write to his parents as he did. There is no censorship on letters from Vietnam. As my colleague, the honorable member for Kingston (Mr. Galvin), said, most of the letter was composed of quotations. AH the facts were quotations from the United States Journal “ Stars and Stripes “, which is available to military and civil personnel alike in Vietnam and throughout the Pacific. On this issue, the forces and their Ministers display acute sensitivity to publicity and to the ventilating of the matters involved. This appeared in the court martial itself. As is shown at page 7 of the transcript of Gunner O’Neill’s court martial. Major Tedder himself referred to the “ letter to the Press “. It is scarcely correct to say that it was a letter to the Press, lt was a letter to the soldier’s parents which they gave to the Press.

Mr Jess:

– So what?


– Like the honorable member, I am anxious that justice be done. I believe that it should be done not only to Navy captains - I shared the honorable member’s concern about one Navy captain - but also, under military law, to Army gunners.

Mr Jess:

– What is the honorable member complaining about?


– I complained, as the honorable member did, about some aspects of Captain Robertson’s case. I would hope that the honorable member would complain, as we do, about some aspects of the cases of Major Tedder, Gunner O’Neill and Lance Bombardier Willey. As appears as page 14 of the transcript of Gunner O’Neill’s court martial, Major Tedder referred to unfavorable publicity for the battery by Gunner O’Neill’s writing to his parents a letter that was published in the newspapers. Is it reasonable to say that this was unfavorable publicity for the battery? The factual information contained in the letter appeared in a United States Service journal that is available to civilians and everybody else in the area.

Gunner O’Neill was put in irons on 1 7th January. Major Naughton, the medical officer, thought this was illegal and it was he who raised the matter first. On 26th January he wrote a minute which appears in the transcript of Major Tedder’s court martial. That minute was in these terms -

O’Neill is bound to write to his parents about this and it could therefore become news. It would seem advisable to give the Adjutant-General a detailed run down on events here so that he can give a definitive answer to the Press.

It is of no avail to abuse the Press in this matter. None of us would have known of it had it not been for Press reports which appeared on 8th March, the day on which the Parliament met at the beginning of this sessional period. The Opposition has been notably reticent in this matter. My colleague, the honorable member for Stirling (Mr. Webb), asked a question on that day. He asked a further question on the matter a week later. This issue has not been exploited in any way. Its exploitation would not be fair to the Army or to Gunner O’Neill, and it would be against his wishes. Whether or not he accepts the position, the fact is that in the interests of the Army and all its personnel, and for the sake of the honour of the Parliament, which makes the laws, and -of the Government, which ought to see that they are obeyed, justice should now be done to this soldier and it should be seen to be done.

Gunner O’Neill committed an offence. He was absent from guard duty. That was a serious offence. He asked to be tried for this offence by a court martial.. It was natural that he should ask to be tried by a court martial, because this incident happened less than a fortnight after copies of the newspaper containing the article had begun to reach Vietnam. Some of the men were concerned at the reaction of their wives. Indeed, some of the men seemed to be frankly envious of the publicity given by means of the letter and the photograph to this soldier who was thought to be shooting a line.

Mr Gibson:

– What basis has the honorable member for saying that some of the men were envious of the publicity?


-I have taken the trouble, thanks to the co-operation of the Minister for the Army (Mr. Malcolm Fraser), to discuss this matter with the persons who know.

Mr Gibson:

– With Gunner O’Neill but with no-one else.


– That is not so. However, I am not at liberty to give the names of the others. I have discussed this and the honorable member has not. I would have expected a lawyer to try to ensure that the laws were obeyed instead of misapplied. The honorable member evidently condones the misapplication of the laws.

What has happened to Gunner O’Neill? He was sentenced to 20 days in handcuffs. This sentence was imposed by Major Tedder after an orderly room trial when he had disallowed Gunner O’Neill’s election to undergo a court martial. When the court martial of Gunner O’Neill eventually came on, the two gunner escorts who had been present at the orderly room trial were on leave and Gunner O’Neill was unable to call them to substantiate his own sworn evidence that he had sought a court martial. His seeking a court martial was understandable, because, during the week or so after the contents of his letter had circulated amon: his comrades in the battery, he was victimised in various petty ways and he thought that he would be more likely to get justice from a court martial.

My colleague, the honorable member for Kingston, has quoted one phrase used by the Judge Advocate in reference to the orderly room trial. The Judge Advocate said also -

To say the very least this orderly room trial was conducted in a most extraordinary manner.

Gunner O’Neill’s conviction on the charge to which he pleaded not guilty at the court martial, and on which he was found guilty, was later quashed. So the only charge on which he has been found guilty is that to which he pleaded guilty. The sentence of field punishment arising from the other matter was quashed. Gunner O’Neill was given 20 days in handcuffs - in irons, as Major Tedder described it. Indeed, the Judge Advocate interposed -

Please refer to them as handcuffs, it sounds a little less medieval.

Gunner O’Neill spent seven days handcuffed to a star picket. For having ordered this punishment, Major Tedder was tried. The other 13 days of Gunner O’Neill’s punishment in handcuffs also constituted an illegal sentence, but Major Tedder was not tried for that. Gunner O’Neill was sentenced also to six months’ detention, which was later reduced to 90 days, and to a dishonorable discharge. On his return to Australia, after an all night flight from . Singapore, succeeding one from Saigon, he was ordered to double in his jeans and Army boots. After five minutes, he said that he could not continue. The punishment meted out seems rather vicious - 20 days’ illegal punishment, 90 days’ detention, a dishonorable discharge and three days on bread and water. Has not the man been punished enough? The Minister for the Army is at pains to justify what has taken place. He justifies it on the ground of previous offences. He justifies holding the soldier for another fortnight, or longer still, if there are no remissions, because of these earlier offences. But these were offences that do not justify an illegal punishment. Again, the Minister justifies the punishment on the ground that there was no other way of imprisoning Gunner O’Neill. The transcript of the court martial shows that there was in fact a detention area in Saigon controlled by Australian military police.

Mr Malcolm Fraser:

– It was quite unsuitable.


– But the transcript shows that it was not claimed that that detention area was unsuitable. Thirdly, the Minister justifies the punishment on the ground that Gunner O’Neill lodged a petition against his discharge but not against his detention.

It may be that because the soldier pleaded guilty to the only offence for which he is still serving time and did not petition against the severity of the sentence, the law has been observed. The law has been observed also in the acquittal of Major Tedder. There is no cavilling at this. It is better that 1 00 guilty men go free than that one innocent man be punished. But the law is not good as it has applied to Gunner. O’Neill. He has suffered illegal punishment. This fact should be taken into account in releasing him from detention forthwith.

As regards Major Tedder, the law is not good law. The law of condonation means virtually that an officer in the field can do no wrong, and the more serious the circumstances in which the Army is operating the greater the impunity in imposing illegal punishments The Minister for Defence has said that the Australian military laws are now being reframed in regard to this matter. This is good. In no other field can we ever plead that ignorance is an excuse for breaking the law. In no other field can one ever plead that he is innocent if his superiors condone what he is doing. This is a complete departure from all other law.

The Opposition is not asking that Major Tedder or Colonel McNamara be punished. We want to ensure that such illegality never happens again. We do not know how many cases similar to this there have been. We would not have known of this case but for Gunner O’Neill’s court martial being reported in the newspapers. It is only by a fluke that a court martial in a foreign land can be reported because it is not likely that the Press will be covering many court maritals in those areas. That is how we found out about this case. We want to be certain that this sort of thing never happens again. From the attitude of the two Ministers who have spoken in this debate, we cannot be sure of this. We want to see that there is justice not only to the major but also to the gunner. It ought to be possible to sea that this young man is discharged forthwith, if that is to be his fate, but not dishonorably. The whole rigour of the law has been imposed on him and no mercy has been shown. This is no way to encourage other members of the Services.

I recommend to honorable members that they read a letter which was published in the “Australian “ last Thursday, 21st April. I doubt if I have time to read the complete letter but it was written by Mr. H. V. Howe, who served in the Australian Imperial forces from 1914 to 1919 and who was military secretary to Ministers for the Army - both United Australian Party and Australian Labour Party ministers - from 1940 to 1946. He exposed the dangers of this law of condonation. He said -

Australian Military Regulations and Orders provide that a soldier undergoing sentence shall not be handcuffed except when there exists absolute and urgent necessity to restrain him from violence, and that a soldier under sentence shall not be handcuffed as a punishment.

Officers ordering the use of handcuffs are required to report the matter in writing to the formation commander, and the time and manner of their use must be reported in detail. In the Army, as in civil life, ignorance of the law is no excuse for commission of an offence, and there is no doubt whatever that an officer who orders the use of handcuffs as a punishment has committed an offence - and a very serious one. It is is fact quite unbelievable that any officer - with regulations available for perusal-

And Major Tedder’s excuse was that he could not read the index. could in fact be unaware that handcuffing as a punishment was illegal.

Nevertheless, in Vietnam, a soldier has been handcuffed night and day for 20 days-for seven of which he was handcuffed to a picket driven into the ground. The officer responsible was charged only in respect of this seven-day period - the remaining 13 days’ illegal punishment has apparently been ignored.

There has been no suggestion of absolute and urgent necessity to restrain the soldier from violence, and it is sheer nonsense to claim - as has been done in some quarters - that the handcuffing was necessary because of the exigencies of battle conditions. The offence was committed, and the punishment inflicted upon the soldier, in a base camp.

I hold no brief whatever forthe soldier. He committed a serious offence and should justly have incurred the punishment prescribed by Army regulations - but in no circumstances a punishment forbidden by such regulations. This also applies to the officer concerned - military law should apply equally to all, irrespective of rank. In the case under discussion, however, the soldier is punished illegally, and the officer goes scot free, without even the formality of any type of inquiry - “ condoned and pardoned “ by his superior officer.

The officer charged stated at the court martial “that he was shocked to be tried for handcuffing Gunner O’Neill, particularly as he had been led to believe that he had no cause to worry.” He had, in fact, discussed the matter with his superior officer while the soldier was still held in handcuffs - and had been permitted to resume duty.

His offence had thereby been “ condoned and pardoned “ - and he could not be convicted by any subsequent court martial, nor could any offence be recorded against him. First enunciated by the Duke of Wellington, this principle is the most pernicious doctrine which has been permitted to survive in the British and Australian forces. It should have been hurried with the Iron Duke.

Motion (by Mr. Aston) put -

That the question be now put.

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

AYES: 59

NOES: 41

Majority . . . . 18



Question so resolved in the affirmative.


– The original question was: “That the House take note of the paper “, to which the honorable member for Kingston has moved as an amendment -

That all words after “That” be omitted with a view to inserting the following words in place thereof - “ in the opinion of this House it would be in the interests of the Army and of Gunner O’Neill that be be released from detention forthwith “.

Question put -

That the words proposed to be omitted (Mr. Galvin’s amendment) stand part of the question.

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

AYES: 59

NOES: 41

Majority . . . . 18



Question so resolved in the affirmative.

Amendment negatived.

That the House take note of the paper.

Question resolved in the affirmative.

page 1309


Discharge of Motion

Motion (by Mr. Malcolm Fraser) - by leave - agreed to -

That the following Order of the Day, Government Business, be discharged -

No. 12 - Case of Gunner O’Neill - Ministerial Statement - Motion to take note of paper - Resumption of debate upon the motion, That the House take note of the paper.

page 1309


Minister for Air · Fawkner · LP

.- I move-

Customs Tariff Proposals (No. 5) (1966).

Customs Tariff Proposals (No. 6) (1966).

Customs Tariff Proposals (No. 7) (1966).

Mr. Speaker, the Customs Tariff Proposals which 1 have just tabled relate to proposed amendments of the Customs Tariff 1966. Proposals Nos. 5 and 6 formally place before Parliament, as required by law, the changes published by Gazette notice while the Parliament was in recess. The amendments contained in Proposals No.5 operate from 12th April 1966 while the amendments in Proposals No. 6 operate from 15th April 1966.

Proposals No. 5, operating from 12th April, makes provision for the duty-free entry of a range of hand-made traditional products of the cottage industries of less developed countries and extends the range of concessions to less developed countries already approved by Parliament.

Proposals No. 6, operating from 15th April, varies the duties on certain glass ovenware and tumblers on which temporary duties were imposed in May 1964, following a recommendation by the Special Advisory Authority. The new duties replace the former combined ordinary and temporary duties and are in accordance with the recommendations of the Tariff Board. The Board’s report will be released when other duty changes affecting glassware are introduced following the completion of international negotiations now in progress.

Proposals No. 7, which will operate from tomorrow, provides for the imposition of temporary duties on alloy steel hoop, strip, plate or sheet in accordance with the recommendations of the Special Advisory Authority, whose report I shall table later this day. In respect of hoop and strip a temporary duty of $448 per ton, less 40 per cent, of the f.o.b. price, is imposed, while on plates and sheets a temporary duty of $448 per ton, less 47i per cent, of the f.o.b. price, is imposed. The temporary duties are in addition to the normal duties and do not apply to goods that were in direct transit to Australia on 14th March 1966 and are entered for home consumption within 21 days after importation. The longer term protective needs of the Australian alloy steel industry, which includes stainless steel production, have been referred to the Tariff Board for inquiry and report, and the temporary duties will operate only until such time as the Government takes action following receipt of the final report of the Board. 1 commend the proposals to honorable members.

Debate (on motion by Dr. J. F. Cairns) adjourned.

page 1310


Reports on Items.

Minister for Air · Fawkner · LP

– I present the report by the Tariff Board on the following subject -

Collapsible sun lounges (Dumping and Subsidies Act) which does not call for any legislative action.

Pursuant to Statute, I also present the report by the Special Advisory Authority on -

Stainless steel.

Ordered that the reports be printed.

page 1310


Bill presented by Dr. Forbes, and read a first time.

Second Reading

Minister for Health · Barker · LP

– I move-

That the Bill be now read a second time.

The Therapeutic Goods Bill, which I present to the House, is designed to ensure safety in the usage of drugs and medicines and therefore can be regarded as a Bill of considerable importance to the Australian people. Although not new in Commonwealth legislation - we have had a Therapeutic Substances Act for a number of years - this present Bill introduces advances in Commonwealth legislative provisions for drug control. When enacted it will assist in ensuring that drugs and medicines and medical equipment consumed and used in Australia meet minimum standards of safety and quality. It will supersede the Therapeutic Substances Act which will be repealed. The Bill does not represent a change in principle or policy by the Government. The policy enshrined in the Bill is similar to that in the present Therapeutic Substances Act, and is in line with worldwide government policies which endeavour to ensure that drugs are safe, pure and potent. In this century we have seen the number of agents available for therapy multiply from a dozen or so to tens of thousands. In fact there are now 20,000 to 30,000 therapeutic agents available in Australia.

The introduction of so many new drugs has been accompanied by a demand for both higher quality and greater reliability and, throughout the world, governments have found it proper to establish legal standards which are minimum requirements for drugs and biological products, such as vaccines and antisera. This is part of an international system aimed at providing a desirable uniformity in standards and a ready interchangeability for these products in therapy and in commerce. The rapid introduction of many potent agents of diverse characteristics, such as antibiotics, and the advances of science and technology, have made the question of their standards a scientifically sophisticated field requiring much work and careful evaluation.

The need for the Commonwealth to legislate in this field is, I believe, unquestioned. The importation of drugs is an area where the Commonwealth’s authority is paramount and must be applied as a control against the dumping of inferior or dangerous drugs. Moreover, the Commonwealth itself undertakes a heavy financial commitment in the provision of pharmaceutical benefits under the national health scheme and it has a clear responsibility to the community to ensure that it gets value for the money spent. Constitutionally, the Commonwealth’s powers over therapeutic substances and articles are limited. This Parliament can enact legislation in relation to drugs, medicines and articles of medical equipment that are imported, exported, made the subject of interstate trade, supplied to the Commonwealth or supplied as pharmaceutical benefits. Legislation concerned with the local manufacture, intrastate supply and consumption of these items is the responsibility of State Governments.

Similarly, the Commonwealth will not enter into the general control of family remedies, including the bulk of proprietary lines. These will remain a State interest. The Commonwealth will only intervene if a substance becomes a pharmaceutical benefit or if there arises a necessity to provide standards for any particular item or type of substance which is imported or which is sold interstate, to prevent it having a deleterious effect on the public in general. For example, one type of preparation in this field for which standards may be laid down is proprietary eye drops, to ensure that they are sterile. I emphasise, however, that, within its limited powers, this Government is conscious of the necessity of providing the legislation and the machinery for ensuring that the safeguards to protect the community are adequate.

Therapeutic agents of almost every type are tested for compliance with standards by my Department at its National Biological Standards Laboratory in Canberra. Considerable progress has been made by the Laboratory, which is staffed by scientists with a wide experience in this very diverse field. In addition to this testing programme, expert committees comprising leading figures in a number of branches of medicine and science have been working for some time on the provision of advice on the complex questions concerning the safety and standards for therapeutic goods. These committees include the Australian Drug Evaluation Committee, the Biological Products Standards Committee and the Therapeutic Substances Standards Committee.

Under this Bill, the basic standards for many drugs and medicines will continue to be the monographs in the British Pharmacopoeia and British Pharmaceutical Codex. In addition, it is proposed in the Bill that the Minister will be empowered to deter mine, by the issue of formal orders, first, specific standards for individual products (at present this can be done by regulations under the Act), secondly, general standards for all therapeutic goods or for certain classes of goods, e.g. tablets, capsules, injections, etc., thirdly, methods of testing for compliance with standards, and fourthly, requirements with respect to labelling, packaging and containers.

Under the provisions of the Bill, goods which are imported, pharmaceutical benefits, supplied to the Commonwealth or the subject of interstate trade, that is, goods which come within the main heads of Commonwealth constitutional power in this regard, will be required to, first, conform to the specific standards as determined by the Minister or as appearing in the British Pharmacopoeia, the British Pharmaceutical Codex or the British, Veterinary Codex; secondly, conform to the general standards as determined by the Minister and, thirdly, comply with any packaging or labelling requirements determined by the Minister.

The provision for the fixing of packaging and labelling requirements will also be similar in principle to that existing in the present Therapeutic Substances Act. However, whereas the present provision only enables these requirements to be fixed for therapeutic substances for which standards exist, the new provision will be widened to embrace all therapeutic substances and articles subject to Commonwealth control. The scope of this legislation, and its name, will be altered to cater for the advance of science and technology. I referred earlier to the fact that under the Bill items of medical equipment as well as containers in which drugs and medicines are packed will be required to meet minimum requirements of purity, sterility, etc.

There has been a very considerable increase in the utilisation of plastics by the pharmaceutical industry, not only as containers, but also as an integral part of the therapeutic agent. For example, an intravenous infusion used in the treatment of shocked or dehydrated patients may consist of a volume of saline fluid in a plastic bottle with tubing and needle permanently attached to deliver the fluid to the patient’s veins. Every component of this product must meet stringent requirements. Safety could not be ensured by fixing a standard for the contents alone. The container and tubing must be leakproof and be capable of being sterilised properly, -and must not interact harmfully with its contents. The existing Act, passed at a time before products had become so refined, does not enable control of these important matters. It is obvious that there is little point in ensuring the purity of drugs and medicines if there is no corresponding control over their containers or the articles used in their administration.

Problems have arisen also from the fact that the definition of therapeutic substances in the present Act extends to veterinary products, but the Act does not provide a reference for the standards for such products. This will be remedied by specifying the British Veterinary Codex as the normal standard for veterinary substances in the same way as the British Pharmacopoeia and British Pharmaceutical Codex are recognised as providing the standards of substances for human use. A review has been made also of the machinery by which the standards for drugs, medicines, medical equipment, containers, etc., are written into the legislation and subsequently made available to the drug industry, users, and others.

It is emphasised at this point that the standards and requirements that will be fixed under the provisions of this Bill will be arrived at by a number of careful steps which have been developed in the administration of the present Therapeutic Substances Act. First, research and reference to all recognised official and scientific publications will be made by departmental officers. Next, representatives of the pharmaceutical industry, particularly those concerned with the relevant class of products, will be consulted. A written standard will then be drawn up and circulated for comment to the pharmaceutical industry. Having given consideration to any comment by the industry, the proposed standard will then be referred to one or more advisory committees comprising independent medical and scientific experts that I referred to earlier which will adjudicate on any differences raised and advise the Minister of their views.

It is proposed also that all Austraiian standards will be written with recognised international standards in mind. Uniformity ot standards for all countries is, oi course, desirable to facilitate international trade as well as to assist Australian industry. In view of the fact that the number of standards to be prescribed will reach considerable proportions and will be of a highly technical nature, it is proposed to provide that the Minister will make ministerial determinations fixing standards, rather than continue the present practice of fixing standards by regulation. The reason for this change is a recognition of the fact that the processing of a large volume of highly technical material by regulations, which is the position under the present Therapeutic Substances Act, is considered unsuitable and has proved impracticable.

The Bill provides for determinations of standards by the Minister to be notified in the Commonwealth Gazette and, of course, copies will be available to all interested parties immediately. Such determinations would be made effective from an appropriate date fixed after consultation with the industry. As a further aid to the pharmaceutical industry, consideration is being given to the publication of a loose leaf book which will contain a compilation of all ministerial determinations arranged in a convenient manner for reference.

The last provision of the Bill to which I desire to make particular reference concerns the seeking of power for the Minister to prohibit the importation into Australia of dangerous substances, that is, substances which may cause disease or endanger life. A good example of such a substance is the drug thalidomide, the side effects of which when taken by expectant mothers caused such tragic deformities to unborn children. The present Therapeutic Substances Act gives the Minister power to invoke quarantine measures in respect to such dangerous substances. The restriction on importation of such substances in the past has been achieved under Customs legislation, with, of course, the co-operation of the Minister for Customs and Excise. Inclusion of this additional power in the Therapeutic Goods Bill brings together the two provisions that are necessary to give emergency controls over dangerous substances when such are necessary.

In concluding, I should like to inform the House, that the proposals incorporated in this Bill have been discussed with organisations representing the pharmaceutical industry - both manufacturing and distributing - and the reasons for the proposals have been explained in detail. The drug industry fully recognises the importance to Australia of adequate controls in this field. The pharmaceutical industry will continue to have a voice in the administration of this Act by being represented on a special committee set up to advise the Minister on the administrative policies as they are developed. The effect of the new legislation, therefore, is that it will streamline Commonwealth control over the standards of drugs and associated medical equipment, lt will enable the powers of the Commonwealth to set standards for therapeutic substances to be applied more effectively and will extend the powers to cover medical equipment used to administer therapeutic agents. I commend the Bill to the House.

Debate (on motion by Mr. Webb) adjourned.

page 1313


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

Second Reading

Minister for Air · Fawkner · LP

– I move -

That the Bill be now read a second time.

The purpose of this Bill is to amend the Sales Tax (Exemptions and Classifications) Act 1935-1965. It has been the practice wilh income tax bills to circulate detailed explanatory notes describing the effect of proposed provision, clause by clause. With this Bill, the practice has been extended to sales tax legislation. Whenever practicable, similar notes will be issued when future amendments to the sales tax laws are proposed. Honorable members will see from the explanatory memorandum that has been circulated that most of the changes are drafting adjustments. They do not alter the original Act in principle. The changes which alter the incidence of sales tax are to be found in clause 4. This clause will amend the First Schedule to the Act, which is the Schedule that sets out the categories of goods that are exempt from sales tax.

In the first place, it is proposed to insert two new exemption items to make the operation of the sales tax law consistent with obligations Australia has accepted under the New Zealand-Australia Free Trade Agreement. This Agreement came into operation on 1st January 1966. Australia has agreed that if sales tax is imposed on goods imported from New Zealand, the rate will not exceed the rate which would apply if the goods were produced or manufactured in Australia. The present sales tax law already achieves this result to a very large extent. There are, however, two categories of goods for which special provision has been considered necessary. New exemption items are proposed to cover, first, fruit juice products containing specified proportions of New Zealand juices and, secondly, works of art imported from New Zealand and produced by New Zealand artists.

One other new tax concession is proposed but this also will have a very restricted field of operation. The principal Act was amended in 1963 to enable United States servicemen stationed in Australia to purchase Australian made motor vehicles free of sales tax. The granting of this concession was one of a number of changes in the taxation laws which Australia had agreed to make in consequence of the Status of Forces Agreement which came into effect in 1963. Subsequently, it was suggested to the Government that if United States servicemen were to be granted the right to purchase Australian made vehicles free of sales tax, it was anomalous that a similar concession was not granted to United Kingdom servicemen stationed in Australia under similar conditions, especially when a broadly similar concession is available to members of the Australian forces serving in the United Kingdom.

In the interests of consistency, the Government has decided to extend the concession to United Kingdom servicemen. The present Bill provides that motor vehicles for use by members of the armed forces of the United Kingdom serving in Australia shall be exempt in such cases or circumstances as are prescribed. Regulations prescribing the scope of the exemption will be promulgated as soon as practicable. These will follow, as closely as the circumstances permit, the terms of the regulation governing the concession granted to United States servicemen.

Another change is designed to ensure that the exemption of gas supplied to the public by gas companies and public authorities will continue notwithstanding technological changes in the gas industry. The present exemption item refers specifically to coal gas. This is being expanded to cover other gases supplied to the public through a reticulation system and used for a purpose similar to coal gas. Of the other changes proposed, two are designed to remove doubts regarding the effect of amendments which were made last year in consequence of a revision of the Customs Tariff, which is referred to in a number of the sales tax exemption categories. The 1965 amendments were not designed to alter the sales tax law but subsequent experience has shown that this objective was not fully achieved in two cases. The doubtful provisions have now been re-expressed. The remaining provisions of the Bill propose changes in terminology which have become necessary as a result of changes of other laws. I commend the Bill to the House.

Debate (on motion by Mr. Crean) adjourned.

page 1314


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

Second Reading

Minister for Air · Fawkner · LP

.- I move-

That the Bill be now read a second time.

This Bill is a formal measure associated with the introduction of decimal currency. It will amend the Income Tax (International Agreements) Act in relation to the calculation of credits for foreign tax paid on dividends derived by residents of Australia. These calculations involve the application of provisions now expressed in the old currency. The amendments proposed will express the credit provisions in decimal currency, but will not otherwise affect the way in which the credits are calculated. I commend the Bill to the House.

Debate (on motion by Mr. Crean) adjourned.

page 1314


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

Second Reading

Minister for Air · Fawkner · LP

– 1 move -

That the Bill be now read a second time.

It is proposed to extend, by a maximum period of six months, the operation of the Vinyl Resin Bounty Act 1963, under which bounty will cease to be payable on vinyl resin sold after 14th August 1966. The question of assistance to producers of vinyl resin has been reviewed by the Tariff Board ‘ in the context of an inquiry into the chemical industry generally. The Board’s report has recently been received and is now under examination. The purpose of this Bill is to continue assistance to the producers of vinyl resin in the interim period, pending conclusion of the examination -of and action on the Board’s report. The Bill also amends the Act in relation to the recent decimal currency change over. I commend the Bill to honorable members.

Debate (on motion by Mr. Crean) adjourned.

page 1314


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

Second Reading

Minister for Air · Fawkner · LP

I move -

That the Bill be now read a second time.

The purpose of this Bill is to extend the operation of the Tractor Bounty Act 1939- 1959 for a further maximum period of six months to 31st December 1966, or such earlier date as proclaimed. Under the existing Act, bounty will cease to be payable in respect of tractors produced after 30th June 1966. The Tariff Board is reviewing the question of assistance to manufacturers of tractors. It is desired to continue assistance to manufacturers in the interim period, pending receipt and examination of the Board’s report. Amendments to the Act with respect to the recent change over to decimal currency have also been made. I commend the Bill to honorable members.

Debate (on motion by Mr. Crean) adjourned.

page 1315


Second Reading

Debate resumed from 20th April (vide page 980), on motion by Dr. Forbes -

That the Bill be now read a second time.


.- As announced by the Minister for Health (Dr. Forbes), the purpose of this Bill is to amend the Quarantine Act to provide measures of quarantine under which new arrivals in Australia who cannot satisfy the quarantine officer that they are not suffering from active pulmonary tuberculosis may be required to undergo medical examination. Under existing immigration procedures ail immigrants coming here under Government assisted passage schemes and all nonBritish migrants travelling as full fare passengers are required to undergo X-ray examinations before leaving their homeland to show that they are not suffering from tuberculosis. Although this compulsory examination applies to assisted British migrants it’ has not applied to full fare passengers of British nationality. These people were not required to have a chest X-ray or medical examination. This measure will mean that all British subjects wishing to remain in Australia permanently or for a longer period than 12 months will have to have X-ray examination and, of course, obtain certificates indicating that they are not suffering from tuberculosis before they embark for Australia. If they do not obtain the necessary medical certificates that they are not suffering from this disease, the power provided in this Bill will require such persons to undergo medical examination when they arrive in Australia and they will be required also if found to be suffering from tuberculosis to undergo quarantine and to submit to treatment for the disease.

The Opposition supports this measure; in fact, we welcome it as we welcome any legislation that will improve and protect the health of our people. We are indeed proud that it was a Labour Government that led the field in combating this dreaded disease. To assist in improving the facilities for the treatment of tuberculosis sufferers the Labour Government of the day made available, by the Tuberculosis Act, funds to the State Governments for the purpose of maintaining diagnostic and after care facilities. It also made funds available for distribution by the States among tuberculosis sufferers. The method of distribution of the allowance was agreed to at a conference by representatives of the States and of the Commonwealth. That Labour Government introduced the Tuberculosis Act which enabled the States to expand facilities to meet the expanding need to combat the spread of this disease - a need which was apparent from surveys that were conducted. The Government of the day met the cost by reimbursement to the States of all approved new capital expenditure dating from 1st July 1948. The reimbursement was for land, expenditure on buildings, furnishings and equipment and plant for use in the diagnosis, treatment and control of tuberculosis. The maintenance cost of the equipment and buildings was also met. That Labour Government also set up an advisory council to advise on measures to be adopted, on standards of equipment and apparatus, standards and training of personnel and standards for hospitals and sanatoria. At that time tuberculosis was by far the greatest individual cause of death among men and women in the prime of life - between the ages of 20 and 40. In 1946 tuberculosis was responsible for 27.6 per cent, of deaths from all major individual causes in people between the ages of 20 and 39 years. It caused more than twice as many deaths as cancer and tumour and exceeded by more than 50 per cent, the total deaths from diseases of the heart. The ground work that has been responsible for the remarkable drop in the incidence of tuberculosis was established in the days of the Labour Government as a result of which we see the improved position of today.

It is pleasing to note from the annual report of the Director-General of Health for 1964-65 that there has been a fall in the total notifications of new cases of tuberculosis in the Commonwealth. However, it is also noticeable that in New South Wales and in the Northern Territory there has been an increase in the new cases notified. We are advised that the increases have resulted from the carrying out of more vigorous case findings and by means of efficient community wide X-ray surveys. The Director-General’s report shows a reduction in the notification Tate from 31.8 per cent, per 100,000 of population in 1963 to 30.6 per cent, in 1964, and states -

Such an improvement indicates that the Commonwealth is joining other advanced countries in the successful fight against tuberculosis.

As we are only joining other advanced countries apparently there is room for increased efficiency in the fight against this dreaded disease. This seems to be indicated by the increased number of cases in New South Wales and in the Northern Territory, lt shows, of course, that we are becoming more efficient in the surveys that are being conducted in this disease, but it is apparent that there is room for improvement. Indeed, the figures for the Northern Territory are alarming when compared with those for the Australian Capital Territory and the States. In the report are tables concerning the incidence of tuberculosis. Table 31 reveals the results of mass X-ray surveys in the Australian Capital Territory and Northern Territory. In the Northern Territory the rate per thousand of population was 13.37 whereas in the Australian Capital Territory it was 1.06, so there is room for vast improvement in the Northern Territory. We can note that in the States the rate per thousand, according to table 30, is, in New South Wales, .12; in Queensland, 7.89; in South Australia, .24; in Western Australia, 10; and in Tasmania, .11. The Queensland rate is very high. The figures for the Northern Territory and Queensland are exceptionally high compared with the rest of the Commonwealth, but this, I understand, is because of the high Aboriginal population in both of those States. Yet we find that in Western Australia, where there is also a big Aboriginal population, the rate per thousand is as low as .10. There must be reason for that. It shows either that there is room for plenty of improvement in both the Northern Territory and Queensland by way of surveys and by attacking this dreadful disease among the Aboriginal population of those States, or the surveys in Western Australia do not reveal the true position regarding the nomadic races.

This measure provides an added safeguard in relation to admitting people with this dreaded disease into Australia, and it is worthy of our support because of that safeguard. But, in my opinion, more needs to be done to conquer the disease in our midst. On page 18 of this same report we find the following statement -

During the year a compulsory chest X-ray survey of all persons of 21 years of age and over was carried out in the A.C.T. Although the figures for the 1962 survey were rather high and rapid growth of the population of the area, which included many new citizens from overseas, had occurred, it has been most gratifying to find that the number of cases of tuberculosis found in the A.C.T. in 1965 was very small.

That shows what can be done when the problem is tackled efficiently. I hope that something will be done as far as Queensland and the Northern Territory are concerned. The report goes on -

In Australia, as in many other countries, the realisation is growing that the means of eliminating tuberculosis as a public health problem have been discovered after long centuries of searching, and yet the disease is still a major concern of community health. As tuberculosis has long been regarded as a disease which doctors alone could not overcome, it will continue to be necessary for the community to take a significant part in its elimination, while members of the medical profession must be prepared to act as leaders in the fight with the necessary knowledge of the disease, and of the means of its elimination.

On page 19 of the 1963-64 report, which refers to the survey, the following appears -

In addition to the encouragement given to the various States in respect of chest X-ray surveys, the Department has instituted a similar compulsory survey for the southern portion of the Northern Territory. . . The actual operation began at Alice Springs on 8th June 1964 and so far the attendances have been most satisfactory. The Northern Territory Medical Service and the Alice Springs Hospital are co-operating in the follow-up work, and the hospitalisation of any cases where this is necessary. It is planned to survey the northern portion of the Territory by means of a portable X-ray unit which is regarded as most suitable for the terrain of the Northern Territory. It is expected that the survey will commence in the coming year.

That survey was reported on in the following year’s report. It revealed that 13.7 per thousand of the population of the Northern Territory were suffering from tuberculosis. We look forward to the report which will be produced shortly after the end of June next with the sincere hope that it will show that this figure has been reduced considerably.

When the next Budget is being prepared I believe that consideration should be given to increasing the tuberculosis allowances. As I have already mentioned, these allowances were first paid by the Chifley Government in the form of grants to the States for the purpose of relieving sufferers from this disease of financial worry, lt was recognised that freedom from anxiety was necessary if a recovery was to be effected. I emphasise that if the allowances are inadequate in this respect, the purpose for which they were introduced is defeated. They were last increased in 1963. Since then, of course, there has been an increase in the cost of living and the value of the allowances now as compared with their value in 1963 must have reduced. As I have said, the effective way of combating this disease or in assisting to cure it is to remove anxiety from those who have been unfortunate enough to contract it.

The total amount paid to sufferers of tuberculosis has been reduced considerably over the years. Information about this aspect is contained in the 1964-65 report. Table 29 on page 82 of the report - I do not want to cite too many figures - indicates that in 1955 the amount spent on allowances to sufferers was £1,904,467. By 1965 this amount had been reduced considerably - to £728,911. The reduction in the amount has been due to the gradual reduction in the incidence of the disease. Surely this leaves room for increasing the allowances to enable sufferers from the disease to be relieved of any anxiety about their dependants and so on while they are under treatment.

Total expenditure has also been reduced considerably. Table 29, to which I have already referred, takes into account capital reimbursements to the States and maintenance reimbursements to the States as well as allowances paid to sufferers. According to the table, total expenditure in 1957 was £8,644,300. This fell to £6,248,599 in 1965. That is a very considerable reduction and something which, in my opinion, permits an increase in the assistance given to persons who suffer from this disease. As we conquer the disease, so will the amount expended be reduced. There has also been a considerable reduction in the number of deaths from the disease. According to table 27 on page 81 of the report, in 1952 there were 14.8 deaths per 100,000 of the population. By 1964 this had been reduced to 3.7.

I should like now to refer to one point in the Minister’s speech which is of some concern. He said -

It is not intended to apply these arrangements -

Referring to X-ray examinations and the like- to specific classes of people who will be exempted under the regulations to the Quarantine Act. These classes include such persons as arrivals from New Zealand, where an acceptable ami-tuberculosis scheme exists, short-term visitors, children under 12 years of age, who are not normally submitted to X-ray examinations, and members of the armed forces of the Crown entering on duty.

I do not object to children under 12 years of age being exempted from these examinations, but what about the children over 12 years of age? The Minister’s secondreading speech means that, if the authorities so desire, these children can be subjected to X-rays. In the present compulsory X-ray survey conducted by the States, all persons under 21 years of age are exempted from compulsory X-ray. Certain recommendations have been made which indicate that the age should be even higher. It has been pointed out too, following a recent survey conducted by Professor H. C. Kelly of the Tasmanian University’s Department of Chemistry, that there has been an increase in the strontium-90 intake in South Australian sheep. The Hobart “ Daily News “ of 13th April 1966 had this to say-

In a recent article published in the Australian Journal of Science, Professor Kelly said there was evidence that the strontium-90 intake in Australian sheep had increased.

The strontium-90 intake in animals in Adelaide and Perth districts had more than doubled between 1961 and 1963.

High density regions of strontium-90 had also been detected in western Victoria and over a wide area of south-eastern Queensland.

If the intake of strontium-90 in sheep has increased it is reasonable to assume that it has increased in humans. In its report in 1965 to the Prime Minister the National Radiation Advisory Committee warned of the dangers of radiation and appealed for prompt action to reduce the doses of radiation from mass X-rays. The Committee reported -

The N.R.A.C. again emphasises that no one should be exposed to radiation needlessly. To this end, and after discussion with the Commonwealth Director-General of Health and the Commonwealth Director of Tuberculosis, it was agreed that the following recommendations should be applied in all tuberculosis control programmes:

Technical developments that would enable the dose of X radiation used in mass miniature surveys to be reduced still further should be applied as promptly as circumstances permit.

The frequency of surveys in each community should be reduced and the minimum age of persons subjected to them should be raised as and when warranted by decline in the indicated incidence of the disease within that community.

Unless special circumstances relating to high incidence require the mass radiological examination of adolescents in a particular locality, no person under the age of 21 years should be included in a compulsory survey.

Diagnostic procedures other than radiological examination should be used when this can be done effectively; for example, use of the tuberculin test in children in appropriate circumstances.

The Committee further reported -

In determining policy in relation to compulsory surveys, the N.R.A.C. recommends that Commonwealth and State authorities should take into account the following additional considerations:

It is especially desirable to minimise the radiation dose to persons under 40 years of age because of its possible hereditary effects.

Every effort should be made to exclude pregnant women from mass miniature surveys. If alternative diagnostic procedures are inconclusive, pregnant women should be listed as special cases for suitable X-ray examination at an appropriate time.

The Committee recommends that radiation workers should be exempted from compulsory mass miniature X-ray surveys if they so desire. I hope that the medical authority charged with giving effect to this legislation will not insist on children being X-rayed but will adopt instead diagnostic procedures as recommended by the National Radiation Advisory Committee. Of course, the same thing applies in the case of pregnant women. Only a few days ago I raised this matter with the Prime Minister by way of a question upon notice and his answer lends weight to my suggestion. I asked -

What action is proposed in support of the appeal of the National Radiation Advisory Committee for prompt action to reduce the dose of radiation used in mass X-ray surveys?

The Prime Minister gave a lengthy answer and referred to some of the points made in the report of the National Radiation Advisory Committee. He said also -

The frequency of surveys in each community is reduced and the minimum age is raised as the incidence of disease in that community declines. In respect of persons under 21 years of age, there is no compulsory survey unless special circumstances prevail. Diagnostic procedures other than radiological examination are used where possible in children.

I draw attention to that statement and its application to children who may come here from overseas.

In his second reading speech the Minister said -

Arrangements are being made, therefore, for all British subjects, with some exceptions which I shall mention later, wishing to remain in Australia permanently or for longer than twelve months, to have chest X-ray examinations and obtain certificates indicating they are not suffering from active pulmonary tuberculosis before embarkation.

I would like to know why people coming here for less than 12 months are exempt from X-ray examination. Surely a person who intends to be here for 11 months is just as likely to spread the disease as is a person who may be here for 12 months. It appears to me that all newcomers to this land should be subjected to the necessary examination or should produce proof that they are not suffering from this disease.

Having made those comments and having raised certain matters which I think require clarification, I repeat that the Opposition supports the Bill.


.- Being interested in matters of public health, 1, like my colleague the honorable member for Stirling (Mr. Webb), am delighted to give the measure an easy passage. The Opposition supports any move designed to reduce the incidence of tuberculosis in this country. The Bill does precisely that. The Bill tackles an anomalous situation - one involving the possibility of tuberculosis being imported into Australia by way of travellers to this country. All persons coming to Australia, with the exception of one major group, are required to have an X-ray examination for tuberculosis before embarkation. The group exempted from X-ray examination comprises full fare passengers of British nationality. Heaven knows why these people have been excluded over the years. This is very difficult to understand, because generally speaking, under this legislation, any person unable to produce evidence that he is not a pulmonary tuberculosis sufferer may be required to undergo a medical examination.

The Bill provides that sufferers from tuberculosis may be quarantined. I do not think it is the intention of the Minister for Health (Dr. Forbes) or the Government to set about quarantining at random people who have arrived in Australia as full fare passengers and who are discovered to be suffering from tuberculosis. I doubt whether it is intended to pack them off to some remote quarantine station. As I interpret the Bill, sufferers could be accommodated in some appropriate specialised place designed to give the kind of treatment that is needed. There are well equipped quarantine stations in such places as Fremantle, Adelaide, Melbourne, Sydney, Brisbane and Darwin. One would not want to subscribe to the view that people suffering from tuberculosis should be treated in quarantine stations when more adequate facilities are available elsewhere. I am concerned that the legislation does not make this point particularly clear. Under the legislation it is possible to get people into a quarantine station. Once there it is not the easiest thing in the world to get them out again. Section 45 of the principal Act covers this particular matter. Any person who is quarantined must make application to get out of a quarantine station. Under regulation 44 he has to apply for release under quarantine surveillance and his application is submitted to the Chief Quarantine Officer. While he is at the station, he is required to help meet the cost of meals and things of that kind. After coming out under surveillance, it is necessary for him to obtain permission to change his address, and he has to report for periodical medical examination. It would seem to me to be very necessary to ensure that wherever it is possible steps should be taken to have people sent to the appropriate tuberculosis hospital rather than to what would probably be an inadequately serviced quarantine station.

Not a large number of people would be involved in this Bill. Already, most migrants have to comply with conditions of admission relating to tuberculosis under the provisions of the Quarantine Act 1908-61. Those who come under assisted passages have to comply, regardless of the country from which they come. All non-British migrants paying full fare have to comply, as the position stands at present. They must show by X-ray that they are not suffering from tuberculosis. As I have said, the only people excluded are the full fare paying British migrants. A figure was given to me a moment ago, but I am not sure whether it is correct, as it seems to be a little low.

It indicates that the number of unassisted migrants from the United Kingdom in 1964 was 3,668, the total who came on a permanent basis being 5,786. If that figure is correct, it certainly bears out, as I have said, that a surprisingly small number of people are involved. I concur with the sentiments of the honorable member for Stirling in relation to this passage in the second reading speech -

Arrangements are being made, therefore, for all British subjects, with some exceptions which I shall mention later, wishing to remain in Australia permanently or for longer than twelve months, to have chest X-ray examinations and obtain certificates indicating they are not suffering from active pulmonary tuberculosis before embarkation.

I raise this because the matter has been referred to me by a tuberculosis specialist who takes the view that this would have the effect of leaving a fairly large loophole and that there is no justification for excluding people who come here for a period of, say, nine, ten or eleven mon.hs as, if they were indeed sufferers from contagious tuberculosis, they could leave a trail of infected people behind them.

Our quarantine provisions have been very effective. If we take the trouble to look at the figures, we find that we have a good record in the health field generally. In relation to notifiable diseases, the report of the Department of Health for 1964-65 shows that there has been no case of cholera, plague, smallpox, epidemic typhus or yellow fever. Many countries would like to be able to say that. The price of such a good reputation is eternal vigilance. However, tuberculosis is still serious in this country. In relation to notifiable diseases, we are able to establish that there were 3,528 notifiable sufferers from tuberculosis in 1964- 65. This number was second in size to the number of sufferers from infective hepatitis. There were 7,000 notified cases of infective hepatitis in 1964-65. In order after tuberculosis came rubella, with 2,697 cases, and infantile staph disease, with 2,203 cases.

Infectious diseases which were identified on overseas vessels that arrived in Australia during 1964-65 add up to a very considerable total and involve a considerable variety of diseases. There were 114 cases of chicken pox, 9 of infectious hepatitis, 118 of measles, 1 of meningitis, 13 of mumps, 1 of poliomyelitis. 6 of pulmonary tuberculosis, 13 of rubella, 1 of scarlet fever, 5 of venereal disease, and six others. It is interesting to note the number of vessels and aircraft on which diseases were found. This indicates the need for the utmost care in the maintenance of a very strong quarantine organisation. In 1963-64 there were no fewer than 92 vessels. I understand that for the purposes of this legislation aircraft count as vessels in the same way as do ships. The number of passengers affected was 361 and the number of crew 11. So there is need for us to review this legislation periodically. In reviewing it, I think it is appropriate to pay tribute to the Department of Health, which administers the great ramifications of our quarantine law and to the officers who discharge their responsibilities with such diligence. The Minister said, in his second reading speech -

This measure . . . will further strengthen the arrangements that were developed by the Menzies Government in co-operation with the State Governments to reduce the incidence of tuberculosis in Australia.

I think I would be remiss if I failed to mention a former Minister for Health who also had a little to do with this business of controlling tuberculosis. I refer to Senator McKenna, who sits in another place. He realised that there were great disparities amongst the States in meeting this very great problem, and he came to grips with it in 1948 and 1949. In that period tuberculosis was of frightening proportions. The legislation introduced as a result of the senator’s concern involved implementation of conditional grants under section 96 of the Constitution. I think it is fair to say that around the problem of tuberculosis there has now evolved the best example of conditional grants to the States.

This provision has also been invoked to provide for free milk for school children, disaster relief, mental hospitals and things of that kind, but there has never been such effective use of the provision as in the case of tuberculosis.

This is in sharp contrast with the attitude taken by the present Minister for Health in relation to other matters affecting the States. Only this morning at question time I asked the Minister whether this Government had concerned itself with the need for regionalised hospitals and the need for salaried specialists. I have not the precise terms of his answer, but he threw up his hands in despair and indicated that constitutionally this was a State responsibility, to which the Commonwealth should have no regard.

Mr Daly:

– Like drought relief.


– Yes, a bit like drought relief. I asked him whether he would confer with the State Ministers for Health to see whether it was possible to assist in the regionalisation of hospitals and things of that kind, but he declined to indicate his preparedness to co-operate. A short time ago I wrote to him concerning kidney machines, which are very expensive, and he wrote back - in effect, again throwing up his hands in despair - stating -

Whilst the difficulties which confront the State Governments in meeting the cost of installing and operating expensive specialised equipment in public hospitals are fully appreciated, it must be clearly understood that the provision of such equipment, including artificial kidneys, is entirely their responsibility and I do not consider that it would be appropriate for the Commonwealth Government to intervene in such a matter.

I am gratified to know that in 1948 and 1949 the Labour Government of the day did not take that kind of attitude towards tuberculosis. The purpose of this Bill is to minimise the incidence of tuberculosis in Australia, but the greatest impact that has been made on the problem resulted from the legislation introduced on 14th April 1948.

It is interesting to look back over the records. On 9th April 1948 Senator Cooper asked a question the answer to which 1 think demonstrated the attitude of the Government of the day towards tuberculosis. In replying to Senator Cooper Senator McKenna said - the Government has decided to wage war on tuberculosis in this country. It is determined that expense will not be allowed to interfere with the tackling of this major problem.

That was a forthright attitude. There was no hiding behind constitutional technicalities. Hitherto it had been the traditional prerogative of the States to concern themselves with this matter and other matters of a similar nature, but the Minister of the da> swept those considerations aside and it is interesting to see that the Minister who now holds the portfolio eulogises the scheme which was then introduced, saying that it was a wonderful thing and thai the Menzies

Government carried it on faithfully and well. Undoubtedly it did: I would not detract from the Minister’s statement in that latter connection in any way But it is a matter of regret that the principle being eulogised by the Minister in that connection is also being denied by him in regard to many other matters to which I have already referred, such as the provision of kidney machines and specialised equipment generally and the regionalisation of hospitals.

We have shown - and the Minister has directed attention to this - that we cannot get anywhere in the health field, especially with our most pressing problems, unless the Commonwealth comes to the party as it did in 1948-49. There were 40,000 people affected by tuberculosis during that period. Senator McKenna said at that time that Cabinet had authorised him to confer with the Health Ministers of various States with a view to evolving a common plan. He said -

The principal thought that the Government has in mind is that it will undertake to bear the financial responsibility of all new buildings and will acquire standardised plant.

My colleague, the honorable member for Stirling (Mr. Webb), has referred to the high incidence of this dread disease at the time. I will not repeat his figures, but the incidence of tuberculosis was quite fantastic. Deaths from that disease were twice as many as deaths due to heart and circulatory troubles. The legislation was introduced with the title “An Act to provide for medical services in respect of tuberculosis and for other purposes”, and it was assented to on 25th November 1948. From 1st July 1948 expenditure generally was underwritten in respect of land, buildings, furnishings, equipment and plant and of all maintenance costs above the level of expenditure incurred in 1947- 48. The Commonwealth encouraged the establishment of thoracic wings attached to teaching hospitals. It subsidised universities in respect of their investigation of tuberculosis problems. In this way it stimulated investigation and research generally. Scholarships were granted and radiological and bacteriological examinations were encouraged for the purpose of locating infected and infectious cases. Today we have our enormous X-ray system operating through out the length and breadth of Australia as a result of that early legislation.

The expenditure for all this was met by the National Welfare Fund. The capital reimbursement to the States from 1950 to June 1965 was no less than £15.7 million. Maintenance reimbursement amounted to £60.6 million and allowances paid to sufferers totalled £19.4 million, giving a total of £95.8 million. All this emanated from the legislation introduced by Senator McKenna in 1948-49. I am gratified to know that this Government is appreciative of what has been done and is prepared to carry on, while it remains in office, this very valuable and high-principled work.

The honorable member for Stirling has said that there is still a considerable incidence of tuberculosis in this country. It is true that in New South Wales and the Northern Territory there has been an increase in the number of cases notified. This appears from the 1964-65 report of the Department of Health. But overall there has been a fall in total notifications throughout the Commonwealth, from 31.8 per 100,000 in 1963 to 30.6 per 100,000 in 1964. The number notified in 1964-65 was 3,528. Another indication that we are coming to grips with the situation and handling it effectively is given by the number of tuberculosis allowances paid. In 1952 the number was 6,127, and by 1964 this had been reduced to 1,573. The death rate has come down from 14.8 per 100,000 in 1952 to 9.9 in 1954 and 3.7 in 1964. But it is a matter of concern that the overall death rate for Australia of 3.7 contrasts so sharply and dramatically with the rate of 12.5 in the Northern Territory. The Deputy Leader of the Opposition (Mr. Whitlam) has directed the attention of the Parliament on a number of occasions to the comparative neglect of tuberculosis among Aborigines. I know that a great deal of work has been done but there is a need to intensify our effort to minimise tuberculosis in the Aboriginal community.

The number of persons being examined throughout Australia is also a measure of the priority being given to this problem. I understand that in the year ended December 1964 2,028,000 persons were examined for the purpose of detecting tuberculosis. The number in Australia with active tuberculosis is 910 and there are 10,523 sufferers from inactive tuberculosis, so the problem is still serious enough.

I do not want to labour the matter further, but I want to conclude by emphasising the point made by the honorable member for Stirling about the anomalous position that exists when people coming to Australia for a period of less than 12 months are not required to undertake tests to establish the presence of tuberculosis before they embark for Australia. Apart from those and the other matters to which my colleague, the honorable member for Stirling, has drawn attention, 1 am gratified that the Government has moved one step forward. 1 hope that we always will be vigilant in our efforts to effect proper quarantine measures so that the comparatively good record that we have in Australia will be improved even further.

Minister for Health · Barker · LP

– in reply - In winding up this debate, 1 say how gratified I am that this measure has such wide support from all sections of the House. I thank both members of the Opposition who spoke in this debate for the tributes that they paid to the officers of the Commonwealth Department of Health and the State Departments that administer this scheme. I place on record my agreement with their view that a tribute should be paid to Senator McKenna who started this scheme. We freely acknowledge that the scheme had its genesis in his action, although over the past 17 years the Menzies and Holt Governments have carried it on very successfully and have been responsible for the situation which has produced the spectacular results that are freely acknowledged.

The honorable member for Hughes (Mr. L. R. Johnson) compared the action of the Labour Government with my reply to a question which he asked today and the implication of which was that the Commonwealth should discuss with the States matters connected with their hospitals systems. He pointed out that, on the one hand, without hesitation the Labour Government entered the tuberculosis field; but, on the other hand, I, when asked whether I would see what the Commonwealth could do to assist the regionalisation of hospitals, replied that that was a matter for the States. I do not believe that such comparisons are valid.

There are two ways of assisting the States in fields which are primarily their constitutional responsibility. One is the way adopted by the Labour Government in relation to tuberculosis; that is, to take something which is not being provided for adequately, which is a well denned segment and which is of great national importance and for the Commonwealth virtually to take it over in the sense of providing all of the money for it. The other way is the one that this Government has been adopting consistently for 17 years in the health field; that is by various means to provide large sums of money to assist the States to fulfil their constitutional responsibilities, either in a general sense by substantially increasing reimbursement grants to the States or in a particular sense by making grants in a particular field.

During the term of office of this Government virtually the whole of the national health service has been created. In this service this year we are spending $230 million. Although most of that money goes to the patients, virtually every penny of it assists the States to fulfil their responsibilities in the health field, including the hospitals field. Money that is paid for pensioners and the Commonwealth benefits that are paid through the hospital benefits scheme assist the States to charge reasonable rates for hospitalisation, increase their ingoings and so make more money available for their hospital systems. On the whole, this Government prefers that method because it believes in a Federal system. It believes that the States should be assisted to discharge their constitutional responsibilities, rather than that the Commonwealth should dive in, take over and control large chunks of what are, in fact, the States’ constitutional responsibilities. However, that is by the way. The honorable gentleman introduced that matter into the debate and I thought 1 should say a few moderate words about it.

I wish to say a few words about a couple of particular points that were raised in the debate. In passing, I point out that the honorable member for Stirling (Mr. Webb) spoke about the tuberculosis allowance. He said that the principal purpose of the allowance was to free tuberculosis sufferers from anxiety. That is one of the purposes of the allowance; but it is not the principal one, which is to make it possible for somebody who is suffering from tuberculosis to maintain himself without having to undertake an occupation that brings him into contact with other people and thus communicates the disease to others. That is indicated by the fact that the allowance is not paid to every tuberculosis sufferer. It is paid only to those tuberculosis sufferers who, it is believed, if they did not receive the allowance and were not taken away from contact with other people, would transmit the disease. For instance, a person with a tubercular hip would not normally receive the tuberculosis allowance. However, the honorable gentleman is quite right when he says that the allowance has the effect of freeing sufferers from anxiety and, therefore, of hastening their recovery.

The honorable member for Stirling also raised the vexed question of compulsory surveys and the impact of X-ray examinations on children. He pointed out that, under the Bill, it is proposed’ to exempt children under 12 years of age. He asked, quite rightly: “What about people between the ages of 12 and 21 years?” Normally, in Australia we do not subject anybody under the age of 21 years to X-ray examination und’er this scheme. He asked why we propose to X-ray people between the ages of 1 2 and 21 years. He quoted from the report of the National Radiation Advisory Committee. I point out that what the Committee actually said was - . . having regard to the continued importance of tuberculosis as a public health problem, the N.R.A.C. reaffirms its full support of the policies of Commonwealth and State tuberculosiscontrol authorities for the use of mass miniature X-ray surveys in a form that best meets the requirements of public health, even if this entails compulsory examination.

The Committee went on to express its view that, if the requirements of tuberculosis surveys can be met whilst exempting children and certain other people, they should be exempted. The reason why people under 21 years of age are exempted under the scheme is not primarily because it is not desirable for them to have X-ray examinations, but because experience has shown that tuberculosis is very seldom found in people in that age group. Therefore, in those circumstances, it is possible for us to say: “ We will take into account what the Committee says about the undesirability of X- rays, although there might be a chance that by not X-raying people under 21 years a few cases of tuberculosis would not be discovered’”. It is a question o. the balance of advantage. Although that is true in Australia, it is not true to the same extent in relation to full fare passengers coming to Australia from the United Kingdom.

Among them, the balance of advantage does not come down on the same side for people in the age group from 12 to 21. We may find with experience that this situation will change. But from what we know at present the balance of advantage comes down in favour of X-ray examinations. To illustrate the same theme, I would point out that even a person who was born in Australia, whatever his age may be, has an X-ray if he has been in contact with a person who has tuberculosis. This is done because the balance of advantage is in favour of X-ray examination.

One other major point was raised. This concerned people who come to Australia for 12 months or less. An honorable member asked: What is their position? This, again, is a question of the balance of advantage. A cut off point has to be established. I believe that most honorable members, if they consider the matter, will agree that it would be quite unreasonable to provide that a person who comes to Australia for only a week must undergo X-ray examination and produce a certificate that he is free of tuberculosis. Such a procedure would be extremely damaging, for instance, to our international tourist traffic, if for no other reason than that most other countries adopt the period of 12 months in fixing the cut off point for determining whether a person shall be regarded as a migrant intending to take up permanent residence as opposed to a person who enters the country on a temporary residence permit. We have adopted international practice in this matter. With respect to X-ray examinations to determine whether a person is free of tuberculosis, the period of 12 months is adopted in both Canada and the United States of America. It is a question of what is reasonable in the circumstances. Again, what represents the balance of advantage?

Finally, Sir, I come to the point raised by the honorable member for Hughes, who said that he hoped that people would not be put into quarantine stations. I can assure him that this will not happen.

Mr L R Johnson:

– There is nothing in the Act to say that they will not.


– If the honorable member reads section 45 of the principal Act, he will find a definition of the word “ quarantine “ and he will learn that the putting of a person into quarantine does not necessarily mean that he is put into a quarantine station. With respect to infection with tuberculosis, the intention would be to put a person in a normal tuberculosis hospital.

Mr Bryant:

– This is a question of putting people in camps.


– Why should we do that? Why should we reactivate a quarantine station for tuberculosis, staff it with doctors and involve the carrier and ourselves in all the expense involved? Why should we do this when we can send a person to a tuberculosis hospital?

Mr Cleaver:

– Better facilities would be available in a hospital.


– As my honorable friend has just reminded me, better facilities would be available in a proper tuberculosis hospital.

Question resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Dr. Forbes) read a third time.

page 1324


Bill returned from the Senate without amendment.

Sitting suspended from 5.59 to 8 p.m.

page 1324


Second Reading

Debate resumed from 21st April (vide page 1056), on motion by Mr. Howson - That the Bill be now read a second time.


– The measure that is before the House deals with Australia’s subscription to a new organisation known as the Asian Development Bank. This Bank is to have an initial capital of $US1 billion, of which only half is to be called up immediately. Some $US500 million is to be the current capitalisation. Australia’s participation in that$US1,000 million is to be $US85 million, or somewhere in the region of $A78 million, only half of which is to be called up. The call up is to be in two halves over a period of five years, one half to be contributed in the form of Australian currency and the other half to be contributed in the form of other currencies - sterling, dollars or gold.

A sum of $US1 billion may be regarded as rather substantial until we look at it, as we ought, in the context of the purpose it is serving - that is, aiding development, both public and private, in Asia and the Far East. We get some gauge of the magnitude on the one hand and of the inadequacy on the other hand of such a sum if we look at the most recently published report of the International Bank for Reconstruction and Development. A quite interesting section of that report deals with the trends and outlook in development and finance, particularly as regards undeveloped areas. It states that a preliminary Bank inquiry, carried out country by country and based on the judgment and experience of the Bank’s country specialists and area economists, suggests that the developing countries could effectively use, on the average, over the next five years some $3,000 million or $4,000 million more of external capital a year than has been provided in the recent past. I cite that as a kind of measuring rod to begin with. Here is a bank - an entity - to be developed over a period of five years, with an initial capital of $1 billion, only half of which is to be called up immediately. The subscription of $500 million is to be paid over a period of five years. We are told by the International Bank that this Asian area is capital hungry to the extent of an average annual sum over the next five years of from$3,000 million to $4,000 million. That highlights the deficiencies, as it were, in the provision of trade, aid and monetary assistance in one form or another in the area. That is the first point I wish to make.

The other thing which I think has to be borne in mind is the context in which this development is to take place - the context of South East Asia and the Far East. There are three areas in the world that are still classified as undeveloped. There is the area of South East Asia and the Far East, including India; there is /the continent of Africa; and there is what may be called the continent of Latin America. This measure does not deal with Latin America, but the statistics which are available in relation to Latin America have, as I think will be seen shortly, some significance in the context of Africa and in the context of Asia. The United Nations Economic Commission for Latin America has estimated that a hypothetical economic growth rate of 4 per cent, for Latin America would, over a period of 25 years, bring the standard of living there up to one-third of the present level in the United States of America and that it would need 50 years, at that hypothetical growth rate of 4 per cent., to reach one-third of the level which North America will have reached 50 years hence, subject to .the condition that the standard of living in the United States of America rises at a rate no greater than 2 per cent, per annum. That is positing a growth rate of 4 per cent, in Latin America, but the Commission goes on, rather sadly, to reflect that Latin America’s real rate of growth is not this hypothetical 4 per cent, but an actual 2.4 per cent. So Latin America, taking the area as a whole, will catch up with United States of America only in 252 years. This gives some idea of the disparity between standards of economic development in one part of the world and in another.

Mr Howson:

– Does that include Mexico?


– I think it would exclude Central America and include the land mass below the Panama Canal. I suppose there is in this region a population of 300 million. Brazil alone has near enough to 80 million people. What I have said gives an idea of the magnitude of the problem of bringing the peoples of Latin America, Africa or Asia up to the standards which have been reached by others.

This cannot be done without the provision of foreign capital, and that means principally capital from more fortunate countries such as the United States of America, Great Britain and Australia. Let me take a more limited period and an actual example. The figures I am about to give are taken either from surveys by the Economic Commission for Asia and the Far East or from United Nations publications of one kind or another. I shall quote them primarily to put this problem in perspective. It is estimated that between 1950 and 1961 foreign capital invested in the third world - the third world is regarded as consisting of those areas other than America and the other countries of the West on the one side and China and Russia on the other - reached a gross total of $US47.4 billion. Over the 11 year period, that gives an average capital flow of something over $US4 billion a year from the developed to the undeveloped countries, or, if you like, from the first and second worlds to the third world.

But there are certain negatives as far as that capital inflow is concerned. There were, first, the repatriated profits on investment that had already taken place; and as against the capital inflow of $47.4 billion there was a repatriation of profits in the same 11 year period of $20.9 billion, or nearly one half of it. Secondly, there was a loss from the deterioration in what are called the terms of trade. The honorable member for Dawson (Dr. Patterson) referred to this matter, in relation to Australia, in a speech the other evening. This is the ratio between what you get for the goods you sell as against the price of the goods you have to buy. There has been a deterioration; that is, a fall in the value of the exports from the third world as against the imports which it must have. There has been a deterioration in the terms of trade of $13.1 billion. In other words, something more than one quarter of the capital inflow was actually taken away by the variation in the price of exports and imports.

The International Bank went on to suggest that therefore the net contribution - that is capital inflow minus capital service minus deterioration in the terms of trade - had been reduced to a sum of $13.4 billion. The conclusion that can be drawn from this is that if the terms of trade or ratio of exports to imports had remained constant - that is, if they had been 100 instead of less than 75 - the third world would not have required the capital contribution.

This is why I want to isolate in this debate the fact that there are three problems that affect this area and the other two areas, Latin America and Asia. There is the question of trade, the question of aid, and the question of better monetary arrangements internationally. All these things have some bearing on the matter before us. The problem that is being grappled with in this measure is one of aid in a relatively limited form. On the question of the terms of trade and the third world, one could well deduce that a reorganisation of the terms of trade would allow such countries to do without foreign aid, or at least reduce their dependence on it. That is a significant fact which ought to be examined.

If we regard the index of world prices for 1951 as being 100, we find that the price of primary products had fallen to 93 in 1961. On the other hand, the price of manufactured products - and basically the trade of the underdeveloped third world is the sale of primary products - and the import of manufactures - had risen from an index of 100 to 126. So, when we relate one side to the other, the terms of trade are 74. In other words the underdeveloped area, by reason of the fixing of prices of commodities on international exchanges, has been robbed of the fruits of one quarter of its products by reason of the unsatisfactory arrangements that exist.

The other sort of factor that has to be borne in mind is that there can be a tendency - a sense of complacency - on the part of what might be called the fortunate or the developed areas to think that they do not have to worry very much about the rest of the world. They can go their own way. To a large extent it is true to say that the prices that have been fixed for the primary products of these underdeveloped countries have been fixed more in the interests of the developed world than in the interests of the underdeveloped world. On that assumption, one-third of the world can exist in a condition of affluence while the rest is allowed to rot away - that is, if we are not very careful about it - and can only improve itself if assistance is given in much more substantial portions than has been given so far by the developed parts of the world. What the situation might be by the year 2000 can be gleaned from these figures.

Mr Howson:

– Are the prices fixed or do they just happen?


– That is something I want to discuss in a moment. All I am suggesting at this point is that there are three fundamental problems today. There is a problem of trade, which has to deal with the prices of goods and services that are exchanged. There is also the problem of aid. But I want to get to the fundamental question involved here, and that is the question of the entire rearrangement of international finance, which renders many of these problems rather difficult to solve. In 1955 the under developed countries had a population of 1,800 million. The industrialised countries - the United States of America, Great Britain, Australia and Russia - had a population of 900 million. One third of the world’s population was in the industrialised or fortunate area and two thirds of the world’s population were in the underdeveloped parts. Estimates can be hazardous. Nevertheless I think the figures I shall give are reasonable, barring some sort of international cataclysm. By the year 2000, on current trends, the population of the underdeveloped areas will have increased from 1,800 million to 4,000 million, whereas the population of the industrialised countries will have risen from 900 million to 1,150 million. Earlier today the honorable member for Moreton (Mr. Killen) spoke about Australia’s birthrate. At the moment the industrialised countries have one third of the world’s population, but by the year 2000 they will have not much more than one fifth. That also poses some problems regarding the future of economic development.

I have given that information to enable the matter to be seen in perspective and to show the disparities. Honorable members can get some sense of the disparities, I suppose, if they divide the Australian gross national product by the population. They will find that the level of income in Australia per capita is in the region of SA1.500 per annum. The average for South East Asia and the Far East area is about SI 00 per annum - only one-fifteenth of the Australian income. There are even variations in parts of that area. Malaysia has a per capita standard of about $280, which is about one-fifth or one-sixth of the Australian average. The figure falls in countries like India and Pakistan where the per capita figure is about SUS90 or about SA85 or SA84.

Mr Chipp:

– The honorable member has to relate prices to those figures, particularly food prices.


– The honorable member for Higinbotham introduces the question of prices. Let me, if I may, bring in the question in my own way. I am trying to suggest that I do not think that the enormity of this problem is realised. I hope towards the end of my speech to give honorable members a little summary of the situation in a country that has an identity comparable with that of Australia. That is Papua and New Guinea. There is such a disparity at the moment that one part of the world has a per capita standard between 10 and 15 times that of another part. That is why I say it is easy to become self -gratified about what is being done here. The sum of one billion dollars looks very good; one-half of it is to be called up immediately and one-half is to be called up over a period of five years. I have here a glossy and interesting publication of the World Bank - its annual report for 1964-65. Honorable members can see in it that the capital shortage per annum for the next five years is from three billion to four billion dollars. Whilst this may be a move in the right direction, it is a very limited move indeed.

I want, now, to refer to the question of trade which, ultimately, is a question of prices. I was interested to receive recently, at the time of the meeting of the InterParliamentary Union a document circulated on behalf of the Minister for Trade and Industry (Mr. McEwen). It announced that certain trade concessions that had been negotiated between Australia and the areas of the world referred to as “ less developed “ were actually to be put into practice. Mr. McEwen explained that the Government had not been able to bring the preferences into operation earlier because it had been necessary for Australia to seek a waiver under the General Agreement on Tariffs and Trade, which is rather familiarly known as G.A.T.T. This waiver has now been granted by an overwhelming vote of the countries who are members of G.A.T.T. 1 applaud the Australian Government for what it did at the recent meetings of the United Nations Committee on Trade and Development - known as U.N.C.T.A.D. Again I would point out the great difficulty in Australia in finding readily available documentation in respect of these bodies. Australia sends representatives to annual and committee meetings of G.A.T.T. Australia is a participant in U.N.C.T.A.D. and we are also members of the Economic Commission for Asia and the Far East - E.C.A.F.E. Nevertheless, little information is available to members of this House on how those important bodies operate. 1 am grateful indeed that I could’ find some quite detailed accounts of recent operations of U.N.C.T.A.D. in the “ 1966 Year Book “ published by a journal which is well known to the honorable member for Chisholm (Sir Wilfrid Kent Hughes) - the “Far Eastern Economic Review”. The “ 1966 Year Book “ contains a much more detailed chapter on U.N.C.T.A.D. than I have ever seen published in an Australian journal. Another chapter relates to aid from the West. It also contains a chapter on the Asian Development Bank, the subject we are debating, and so on. In respect of the negotiations that took place recently at U.N.C.T.A.D. meetings the book states -

The turning point in the debate on preference* may be said to have been reached on 19th May 1965 when the Australian Minister of Commerce and Industry -

That is a reference to the Acting Prime Minister, the Honorable John McEwen - announced that his country planned to apply preferential rates to selected imports from developing countries. The Australian proposal thus recalls the Brasseur plan … in that preferences would be limited to certain products . . . Their importance lies, however, in the fact that the Australians must secure a waiver from the G.A.T.T. before they can implement their plan.

Apparently it took all the time from 19th May 1965 until 12th April 1966 for the machinery negotiations to take place. The book continued -

The Australian demand is being studied by a G.A.T.T. study group even bow; should the latter recommend that it be granted, the way will probably have been opened for the creation of preferences in favour of developing countries.

The significant point was not the amount of trade that had been done between Australia and the countries that are affected. In fact, according to this book, it is only about 2 per cent, of Australia’s annual imports. Relatively, it is a flea bite, but it is a breakthrough as far as many of these rather mysterious bodies are concerned. There are struggles of a political kind. G.A.T.T. is regarded rather as being an American type of organisation, whereas the Russians have been able to break through and take certain technical steps in respect of U.N.C.T.A.D. Those persons will know who read the details of the World Bank’s report on the question of development that in the long run an ultimate rise in the standards of living of the poorer countries can come only as the result of two steps: They must diversify their economy; and they must make their existing agricultural and primary production more efficient than is the case at present. Most other parts of the world, of course, have been very fortunate historically because of the period of time they have had to go through these sorts of phases. But in essence we are asking some of the undeveloped parts of the world to go through these phases in periods of no greater length than 20 to 30 years. At present the world’s undeveloped areas contain about two-thirds of the world’s population. In a span of not much more than 30 years they will contain about 80 per cent, of the world’s population and we are asking them to pass through the sorts of revolution that more developed areas have had the luxury of passing through in periods of up to 300 or 400 years. It is quite clear that they cannot do it unaided.

The first question that needs to be answered is: What is the nature of the capital inflow that is required to encompass such changes? How much capital can be absorbed in these countries? The pace of absorption of capital is determined by a country’s standards of development at this point. The capacity of the undeveloped countries to absorb capital is quite clearly illustrated in the annual report of the World Bank for 1964-65. At least the pace of absorption in the undeveloped countries is much more rapid in 1965 than it was in 1945 or in 1955. I suggest that $85 million now, or $500 million, as far as the Bank as a whole is concerned, is only a very small amount of what has to be faced in the years ahead. Sometimes I think it would be wise if we were to include in foreign affairs debates the subject of economic development so that the matter might be kept in its proper perspective. After all, there is some relationship between what you defend yourself against and the question of economic development. The tensions that exist in the world at the moment can be glossed over as a surge downward of Communism, the halting of imperialism, the death of colonialism, or something else, but they are simply attempts by the undeveloped parts of the world to improve their level of development. 1 should think that, in the long run, spending money constructively on what might be called economic aid, trade and capital assistance is just as sensible as spending money on defence. It is easy enough for the Government to take credit for increasing defence expenditure from f 200 million to £400 million or from $400 million to $800 million, but, of course, no-one ever tries to assess whether $800 million spent on defence is necessarily twice as good as $400 million spent on defence. We ought occasionally to stop and ask ourselves whether spending much lesser sums much more systematically on trade and aid would be a more sensible approach.

Mr Chipp:

– The honorable member speaks of them as alternatives.


– For goodness sake, do not divert me. I will answer the questions after the meeting, if the honorable member does not mind. This subject, with all respect, is not an easy one to develop, and all I am hoping to do tonight is to focus some attention on some matters that seem to mc to be fundamental. The honorable member for Higinbotham (Mr. Chipp) asked about prices. I have heard the Minister for Trade and Industry, who is now the Acting Prime Minister, say in this House that the prices, not so much of wool but of wheat, meat and sugar, are not world prices. After all, most of these products are sold domestically. Most of Australia’s sugar is not sold domestically, but if we take the world as a whole we see that about 80 per cent, of these products are sold domestically. Only about one fifth in aggregate of all the world’s surpluses go on the world’s markets. The Minister, quite truly in my view, said that their prices are not natural prices, but manipulated prices. They are fixed by such arrangements as the International Wheat

Agreement and the International Sugar Agreement. But the undeveloped countries so far do not have any assurance about the prices of the commodities that they sell. The figures contained in the book I have here - I will not weary the House with any more figures now - show the whole of the advantage of so called aid can be taken away by a fall in the prices of the products that these countries sell and that there is a need to stabilise the prices of the commodities. I do not say that that is a solution of the problem. It is not, because these are highly complex matters.

I hope that the Treasurer (Mr. McMahon) will circulate the document to which I shall now refer. It is not possible for me at this stage to do more than merely refer to it. lt is a publication of one of the special committees of U.N.C.T.A.D., called the Trade and Development Board. The report was published on 1st November 1965 and deals with the subject “ International Monetary Issues and the Developing Countries”. It is interesting to see that a member of the Board was a Professor of Economics at the Australian National University, Professor Swan. Another member was Mr. Alkhimov of the Ministry of Foreign Trade of the Union of Soviet Socialist Republics. The remaining members came from Brazil, Ceylon and other countries. It had a diversity of representation of what might be called capitalist and socialist economies. The report quite rightly points out that, whilst aid and capital assistance are part of the problems of these countries, essentially the besetting deficiency of the undeveloped countries is economic liquidity. These countries have enough people in their populations, but the people are not customers. They do not have sufficient purchasing power in their hands. I commend the report of the Trade and Development Board and recommend that a copy of it be given to every honorable member. I know that the recommendations of the Board will rustle the dovecotes on the other side. The gravamen of the recommendations is that anything set up as a bank has within it the capacity to create credit. The inequity at the moment is that most of the organisations that have been set up on an international basis distribute this capacity to create credit, not in favour of those who have not, but to the advantage of those who have. The Board argues for a change in international monetary arrange ments. I do not have the time to traverse the whole of this subject tonight, but I hope that it will receive the full attention of the House in the not very distant future.

The Board suggests that we create a new sort of international organisation which, by means of some new sort of international currency, would give all the liquidity that would be required by the countries that are too poor to buy at the moment. What do we say about our own economy? We say that the factor that makes an economy stronger is effective purchasing power in the hands of the great mass of the people. The big deficiency in the undeveloped countries lies in the inadequacy of purchasing power in the hands of the great mass of the people. Whilst this idea may sound revolutionary it is, to my mind, the only ultimate solution to the problem. Those countries that have the technical capacity to sell at the moment are hindered because the undeveloped areas do not have the financial ability to buy. What happens is that, when there are balance of payments difficulties, those areas which in essence are economically strong internally are taking external action to protect their own position, and this external action adversely affects the areas that we claim we are assisting to develop. That is why I regard this report as a most significant and fundamental document. Until I happened to see reference to it in the weekly survey published by the International Bank, which gave the reference number, and obtained it from the Library, I for one was not aware of its existence. I say modestly that, if I was not aware of it, I doubt whether very many other members of the Parliament were aware of it. But be that as it may. Now that it is revealed, as it were, I think it is worthy of close study by all of us. It highlights the need to change the international monetary arrangement so as to secure a better flow of liquidity. After all, it is only the money in the pocket to buy goods that is the limiting factor. It is not the shortage of customers; it is the shortage of purchasing power. All I suggest at the moment is that we are not providing the purchasing power.

In the few minutes I have left I want to mention again a matter I raised in a previous debate in this House. This is a problem that is fairly immediate to Australia. It is the economic development of the Territory of Papua and New Guinea. Under the terms of the Bill that is now before us Australia will be a subscriber to the Asian Development Bank, but it may not be a borrower. However, the Territory of Papua ‘and New Guinea may become a borrower, provided that certain administrative alterations are made to, I think, the terms of Australia’s adherence to E.C.A.F.E. In Papua and New Guinea - I am speaking of the two as one - in many respects we have in microcosm, as it were, what the economists now call a macroproblem, or the problem of the undeveloped world. In Papua and New Guinea there are approximately 2 million people in an area that is about twice the size of Victoria, or approximately 180,000 square miles. This area has at least two economies. Probably if we were to examine the situation closely, we would find that it really has three economies. The economy has a monetary sector and a subsistence sector.

The honorable member for Chisholm (Sir Wilfrid Kent Hughes) referred to Taiwan. Let me say with all respect to the honorable member that Taiwan could not be in its present state of economic development without the magnificent economic assistance that has come from America. I am not arguing about the politics of Taiwan; I am simply saying that that country could not be where it is economically without American assistance. An idea of the magnitude of the problem in New Guinea can be gained from reference to the report of the World Bank on Papua and New Guinea, which has been tabled in this House but not yet debated. That document contains an estimate of the income and expenditure up to the year 1962- 63. It shows that three years ago the total monetary level in round terms in Papua and New Guinea, with a population of 2 million people was £A150 million. The population of Papua and New Guinea is slightly less than one-fifth of the size of the population of Australia. If we were to divide the Australian gross national product by five, we would obtain a sum of approximately £1,500 million, or 10 times the level that prevails in Papua and New Guinea. That gives some idea of the overall disparity between the levels of economic development in Australia and Papua and New Guinea. In other words, it is a factor of 10 to 1.

I come now to the subsistence sector of the economy of Papua and New Guinea. The report of the World Bank reveals that of the population of 2 million approximately 1,900,000, or 95 per cent., are still in the subsistence sector. That proportion of 95 per cent, derives not much more than 60 per cent, of the total income or total economic endeavour of the Territory. The remaining 5 per cent, derives about onethird of the total income. So we have also the problem of disparities within the economy.

The problem that faces the world in considering developed and undeveloped areas - we may take Indonesia as the nearest example - is how, in a short space of time, to lift the economy from what is basically a subsistence level, at least in relation to 90 per cent, of the population, and to equate it with, say, the Australian economy in which 10 per cent, or less of the population is engaged in the subsistence sector or in primary production. It seems to me that, although a brief endeavour is to be made under the terms of this legislation, it is by no means significant enough to encompass the real problems. We are confronted with problems of trade ami aid. If we are not very careful, what wc seem to be doing in providing aid can be offset by deficiencies in trade policy, lt is a question not so much of monetary reform. When all is said and done, money is only the stuff that makes the economy work. What we must do is to alter the nature of economic production and distribution within the economy. Surely that is the fundamental problem that faces two-thirds of the world now and which will face four-fifths of the world eventually unless we grapple with it within a measurable span of time.


.- lt is not often that one can speak of the formation of a bank as being something which captures the imagination. The establishment of the Asian Development Bank does stimulate the imagination. If we look at what has happened in the world since the 1939-45 War, we see that one of the real causes for optimism about the future is the extent to which various countries have been prepared to co-operate in the field of economics and finance. In Europe we have had the example of the European Common Market. If anybody had suggested before 1939 that France and Germany which were traditional enemies on the Continent, would go to Rome to sign a treaty under which they would join with four other countries to drop customs barriers, to establish the free movement of people between those respective countries, and even to part with a small bit of sovereignty to a council at Brussels, he would have been thought to be very wide of the mark indeed. But this co-operation does exist. Difficulties arc being experienced, but nevertheless it is a remarkable exercise.

There has been a considerable amount of co-operation in the South East Asian area. A great deal of the credit for this development’ can be given to the .Economic Commission Ibr Asia and the Far East. It has done a great deal to sponsor co-operation in this area. This Commission, or E.C.A.F.E. as it is called, consists of 21 regional members, 5 non-regional members, and 2 associate members which are Hong Kong and Brunei. A survey of the member countries would take one through Afghanistan, Pakistan, India, Ceylon, Burma, Thailand, Malaysia and down to Australia and New Zealand. Indonesia was a member until 31 st March 1,965, when she left the United Nations. One hopes that she will rejoin E.C.A.F.E. As we turn north, we come to the Philippines, Japan, South Korea, Mongolia, South Vietnam, Laos and Cambodia. There is a considerable degree of co-operation amongst these regional members. They are our neighbours.

Although the population of Australia is small when compared with the population of India or Japan, or even Indonesia, over the past 15 to 20 years we have proved to be large in goodwill. We have done a considerable amount to help our neighbours. We have provided money, men and equipment and we have trained students in our universities. Much of this has been done under the Colombo Plan and under the South East Asia Collective Defence Treaty. As honorable members will recall, quite recently the House passed a Bill to reduce the customs tariff in order to give concessions to the underdeveloped countries in this region so that by trading with us they might be able to obtain some export income. Moreover, we went to the defence of South Vietnam and Malaysia when they were under attack. I believe that Australia’s efforts and goodwill have been recognised and appreciated by these neighbours ana -.hat we have a real opportunity to exercise leadership. Recently the lawyers of Australia sought to arrange a conference of law officers from these countries.

The question arose as to the venue for this conference. There was no contest that it should be in Delhi or in Tokyo. Those concerned were completely content that it should be in Sydney. They recognised Australia as a co-operating member in the area. Whether this law conference of officers from the E.C.A.F.E. countries will take place depends to some extent on finance, which is not finally arranged, but the proposals have been accepted by the various countries concerned and this is another example of co-operation and, I suggest, of Australia’s leadership in some aspects in the area. We have to realise that although we are essentially Western people with Western ideas and skills and with Western ties, we cannot hope to continue to live, as it were, as a part of Europe or even to trade in the future to any great extent with Europe. One of our former great customers - our mother country - is contemplating at present joining the European Common Market, and it is quite apparent that our future as far as trade and other matters are concerned lies in this area.

In the past, our direct help to neighbours in this area in money, food or equipment has raised some difficulties. Generally aid of this type is given on a government to government level. If conditions are attached to aid given between governments there is a risk that the aid will not be appreciated and may be even resented. If there are no conditions attached, then it is an unfortunate fact that the aid does not always reach the area or the people that it is designed to help. The Asian Development Bank which is provided for by the Bill before the House does avoid those difficulties. In the first place the Bank is being formed on Asian initiative and therefore there is no need for any country in the area to regard the Bank with any suspicion or distrust. Secondly, the aid which the Bank will give will be on a commercial basis in the form of loans interest, or guarantees. This means that there will be no need for any customer of the Bank to feel that he is expected to be grateful. Ultimately, of course, he will have to repay his loan - if a loan has been obtained - and then the project will be inspected and assessed by the Bank which will represent no single country. If in a particular case a project is approved, then the fact that the Bank is a lender will enable it to insist on a degree of oversight of the spending of the money and the development of the project. There will be - and this is visualised in the Articles of Agreement of the Bank - a degree of accountability.

I suggest, Sir, that this Bank is a remarkable exercise in co-operation in this area and that the Government deserves commendation not only for its farsightedness in joining actively in this project, but also for its generosity. Its capital contribution will be SUS85 million. This shows the importance which the Government attaches to the project. The question now arises whether the Bank will succeed. 1 think that the experience of the World Bank, to which the honorable member for Melbourne Ports (Mr. Crean) referred, shows that the Asian Development Bank will succeed. I have been studying the Articles of Agreement attached to this Bill. These Articles will form the constitution of the Bank. They are very similar to the Articles which form the constitution of the World Bank. As honorable members well know Australia is also a member of the World Bank and contributed to the capital of that Bank originally a sum of $200 million.

It is perhaps an interesting exercise to compare the two Banks. In doing this one might refer first to the objects which these Banks have. They appear in the reverse order. In the Articles of the World Bank we find that the first object is -

To assist in the reconstruction and development of territories of members by facilitating the investment of capital for productive purposes, including the restoration of economies destroyed or disrupted by war, the reconversion of productive facilities to peacetime needs and the encouragement of the development of productive facilities and resources in less developed countries.

That may be broadly summarised as reconstruction following the war, and development. The second object is -

To promote private foreign investment by means of guarantees for participations in loans and other investments made by private investors; and when private capital is not available on reasonable terms, to supplement private investment by providing, on suitable conditions, finance for productive purposes out of its own capital, funds raised by it and its other resources.

Although the first of these objects refers to reconstruction following on war damage as well as to development, in ils actual course of operations the World Bank was not much concerned with reconstruction. It left this, by and large, to the moneys provided under the Marshall Plan. The World Bank has, in fact, under that first object, been essentially a development bank just as this Asian Bank will be. The first object of the Asian Development Bank is -

  1. to promote investment in the region of public and private capital for development purposes.

That corresponds with the second object of the World Bank. The second object of the Asian Development Bank is - (ji) to utilize the resources at its disposal for financing development of the developing member country in the region, giving priority to those regional, subregional as well as national projects and programmes which will contribute most effectively to the harmonious economic growl h of the region as a whole, and having special regard to the needs of the smaller or less developed member countries in the region.

We have there the promotion of investment and development by way of loans and guarantees. In this respect the objects of the two Banks are similar.

The experience of the World Bank shows that such a bank can operate successfully according to business principles. It is rather interesting to look at one set of development projects engaged in by the World Bank in one of the countries in the E.C.A.F.E. area. I refer to Thailand which has been a customer of the World Bank. For a good while the World Bank has had a representative stationed in Bangkok. As a result of development loans from the World Bank various projects have been undertaken in Thailand. I shall mention just four. There was first the modernisation of Thailand’s railways; secondly, the dredging of the estuary of the Chao Praga enabling big ships to come up to Bangkok; thirdly, the building of irrigation works upstream; and fourthly, the building of the Yanhee Dam which will be producing electricity. These are substantial projects and are an instance of a development bank operating in this area.

There is little doubt that the proposed Asian Development Bank, which from its Articles obviously will be operating along similar lines to the World Bank, will be able to operate successfully.

May 1 just say a word or two about the way in which the Asian Development Bank will operate?

So far as its structure is concerned, it will have a President, one or more VicePresidents, a Board of Governors and a Board of Directors. The President apparently is to be the key man. He will be not only the chief executive officer but also the Chairman of the Board of Directors. The Board of Governors will be a curious kind of shareholders meeting. Each member country that has contributed capital will be entitled to a governor, and he will have an alternate. These governors are to meet once a year, or more often if called together by the Board of Directors, and they will vote according to the interests of the member countries. Each member country will have the same number of basic votes, which comprise 20 per cent, of all the votes. Over and above this set of basic votes, which will be held equally by each member, the various member countries will have additional votes proportionate to the amount of capital they have subscribed.

The Board of Governors will have vested in it all the various powers of this Bank. There are certain powers that the Governors cannot delegate to the Board of Directors. They alone can admit members, increase capital, amend the Articles and so on. But, by and large, the management and control are to be delegated to the Board of Directors. This Board of Directors is to consist of 10 members, seven of whom must come from regional members in the E.C.A.F.E. area. Australia, as a regional member of the E.C.A.F.E. area, may be expected to have one of these seven members of the Board of Directors. There will be three directors who will come from non-regional members. The schedule shows that some of those who will contribute capital to the Bank will be non-regional members.

The Articles indicate that the Bank will make loans and will charge a commercial rate of interest. So it is intended that the Bank should operate profitably. Before lending, it will inspect and report on the relevant project, the feasibility of it and the prospect of being able to get repayment. By and large, the Bank will not lend money unless it can see that it can get repayment. There is provision for soft loans, as they were described in the Minister’s second reading speech. There is to be a special fund, not to exceed 10 per cent, of all the funds of the Bank, from which money may be provided on longer terms of repayment and softer terms.

The Bank may also guarantee loans. Those with whom it may deal are instrumentalities or agencies of a government nature or other enterprises. It can deal with a corporation. Presumably a water board or an electricity commission will be able to apply for a loan to the Asian Development Bank, but if it does so and is not a governmental instrumentality, it is contemplated that the loan will be guaranteed by the government of the country in which the borrower operates.

It will be seen that the Bank will derive interest. The Articles also provide that it will charge a fee or commission in those cases where it procures a loan. This will be a kind of procuration fee. In those cases where it guarantees a loan, it will charge a commission on making its guarantee. The fees and commissions will go to a special reserve, which will be available to meet the Bank’s liabilities. Out of its revenue generally, which will include interest, it will be entitled to build up reserves, but any surplus may be distributed among the members. When one studies the Articles of the Bank, one finds a curious fact. It is that in this Bank, theoretically member countries can obtain a dividend from its operations if the operations are successful. One would think that in joining the Bank, Australia would hardly look to obtain much of a dividend on capital, but there is provision for the distribution of surplus income if any should accrue and not be required for reserves. Member countries which subscribe capital may benefit in this way.

The Articles provide that money from a loan for a developmental project will be applied and spent on goods and services to be supplied by member countries. So, unless there were special circumstances, if a country such as Thailand obtained a loan, it would be expected to obtain goods and equipment from a member country such as Australia or Japan. As we stated in the second reading speech, there is provision for the initial contribution of Australia to be applied to the purchase of goods and services from Australia. In this way, Australia may be expected to get a double benefit. Not only will it be selling goods and services to other countries but also it may expect that business goodwill may arise in the countries receiving manufactured goods and equipment from Australia. This may be regarded as one of the material short-term gains from this project.

The honorable member for Melbourne Ports (Mr. Crean) mentioned the position of Papua and New Guinea, and perhaps I might say a word about that. At the moment, it would seem that the Territory of Papua and New Guinea would not be able to obtain a loan from the Asian Development Bank when it is established. But if Australia were able to alter its membership of E.C.A.F.E. so that Papua and New Guinea would be regarded as part of Australia, this position would be altered and Papua and New Guinea would be able to borrow from the Bank. I understand that steps are being taken to explore the possibility of arranging that, because, as the honorable member for Melbourne Ports pointed out, there is no doubt that enormous funds will be required for the development of Papua and New Guinea. If some of the burden of this could be taken from Australia, that would be a great advantage.

May I say again that this represents a significant and farsighted step in cooperation in this area. lt is true that the amount of money that will be subscribed in the first instance is not large when one considers the requirements of the area. The subscribed capital will be SUS1..000 million. In the first instance, only half of this will be what is called paid in capital. Normally, we refer to it as paid up capital. The other part of it will be uncalled capital. By and large, the Articles contemplate that the uncalled capital will be called up only if it is necessary to discharge liabilities of the Bank - in short, if the Bank goes into liquidation - but the fact that 50 per cent, of the capital is uncalled will be used by the Bank for the purpose of borrowing. That is one of its purposes. According to ils Articles, the Bank will borrow on the security of this uncalled capital and will use borrowed funds to lend again to the countries which require developmental loans. Half the paid in capital has to be paid in in convertible currency - for example, gold or United States dollars. The other half may be paid in in the currency of the country paying it in, and may be paid by promissory notes or securities. These securities will be noninterest bearing and non-secured and will be payable only when demanded. That is to say, they too will form a security on which the Bank can borrow, or if the Bank requires to call them up and make a demand it can do so. The Articles contemplate that if a demand is made on the notes of the member countries, it will be made only at reasonable intervals and will be made proportionately or equally between all members. No demand can be made on one member only. This is a safeguard against a sudden call on one member. This appears to be a sensible arrangement as regards the capital. But the capital is, as I say, relatively small. First steps in a project of this nature are necessarily small. There is no reason why, as has happened in the case of the World Bank, there should not be increases of capital when the project is proceeding successfully and when it is seen that this is justified.

In conclusion 1 should like to say that it is patent to everyone that there is a great movement and a stirring among peoples in this region. Those whom we regard as our enemies in this area talk of those countries being ripe for revolution. I would suggest that we see them as ripe for development. Although the part that this Bank will play at first may be small, it will in ils own way, if it is successful, make a contribution to an economic revolution in these countries.


.- I would not have made any comments on the speech by the honorable member for Parramatta (Mr. Bowen) if it had not been for his last few remarks. On the whole his speech was vary restrained and balanced, lt was one, of course, of an honorable member who has faith in conservative economic policies. His legalisms of the banking institution, its laws and by-laws, came out in his speech. My comment on the remarks of my neighbour the honorable member for Parramatta - his electorate is adjacent to my own - concerns his statement that although some people say that these Asian countries are ripe for revolution, he believes them to be ripe for development. Surely honorable members realise that this area has been ripe for development for generations. The proposed Asian Development Bank is actually an offspring of the International Bank for Reconstruction and Development. The Asian Bank was thought of some 19 years ago and it is just coming into being. Yet it is said that this area is ripe for development and not for revolution. When this Bank was contemplated 19 or 20 years ago we might have been able to avert revolution within the area. The Opposition’s criticism is that it has taken too long to establish the Bank.

The interest burden and restrictions will be such that the Bank will be able to do little within the area. However, we on this side of the chamber support the Bill for the little that it will be able to achieve. We are grateful for any small crumb that we can get from the conservative elements opposite which will assist in the Asian underdeveloped areas, even if those moves are at a crawling pace. One should look at the background of the Asian Development Bank. In the broad sense, the concept of the Bank goes back to at least the early post-war years when the idea of a public international institution, supported co-operatively by its member nations and designed to spread growth in developing areas, led to the foundation of the International Bank for Reconstruction and Development. Subsequently, the idea of institutionalised multilateral co-operation in development financing was broadened with the establishment of two specialised affiliates of the World Bank - the International Finance Corporation and the International Development Association. By 1964, two regional banks, the InterAmerican Development Bank and the African Development Bank, had been set up to assist the developmental problems of these regions. The Asian Bank will take its place as a regional development bank.

The proposal to establish an Asian Development Bank arose out of a resolution passed at the first ministerial meeting on Asian economic co-operation held in Manila in December 1963. The agreement establishing the Asian Development Bank was signed by representatives of 29 potential member countries at a conference held at Manila early in December 1965. The original proposal for a bank of this kind arose as an Asian initiative and the Bank will be predominantly an Asian institution in location, finance and management. The Asian Bank was designed primarily to foster economic growth and co-operation in the Asian region and to contribute to the acceleration of the process of economic development of the developing member countries in the region. But as well it is intended to bring an explicitly Asian viewpoint to bear on the problems of growth in the region and to meet Asia’s specific economic needs; to stimulate a flow of public and private capital into Asia from outside the region; to stimulate the flow of capital on a sound fiscal basis from the Asian countries themselves for use elsewhere in the Asian region; and to provide an administrative channel through which those governments interested in national and regional development in Asia as a whole, or in specific areas of Asia, can make funds available for special purposes or on set terms.

Australia joined the Bank on a basis of an Australian subscription of SUS85 million. Half of our subscription will be paid in and the other half will be called on only to meet obligations arising from future operations of the Bank or defaults on loans, or guarantees made or entered into by the Bank. By the end of January 1966, 19 regional countries and 12 nonregional countries had signed the Articles of Agreement. The original countries include all the member countries of the Economic Commission for Asia and the Far East, except Burma and Outer Mongolia. Towards the Bank’s initial capital of $US1,000 million, subscriptions now total $US992 million, which is made up of SUS642 million from regional countries and $US350 million from nonregional countries. Whilst preparatory work has been conducted under the auspices of E.C.A.F.E., the Bank will be an independent entity, although a relatively close co-operation with E.C.A.F.E. is to be expected The headquarters of the Bank will be located in Manila.

The Bank’s loan operations will normally take the form of direct loans from capital funds or funds borrowed in private markets on terms similar to those of World Bank loans lo developing countries. Loans may be expected for the normal range of projects, such as roads, ports and power installations, for agricultural projects such as irrigation systems and agricultural credit institutions, and for private enterprise activities in manufacturing and service industries. This is the background of the new Asian Development Bank. One may ask whether the Bank will meet Asia’s specific economic needs. It does little when one considers the hunger, poverty, disease and illiteracy that exists within the area of Asia. When we look at the area that the honorable member for Parramatta mentioned, if we take a line from Australia up to Pakistan and across to Japan, we find that at least half the world’s population exists within that area. Of course, this is an area that has been plundered and pillaged and exploited by the more affluent nations of the world for the past 100 years.

Now we have decided to establish an Asian bank with an authorised capital of $ US 1,000 million. But we find that $3 3 million has been spent by the United States in one day on the war in Vietnam and that $1,000 million is being spent there in one month at the present time. We know, also, that there will be further increase in expenditure if the war is escalated. I can well recall Mr. Justice William O. Douglas of the American Supreme Court coming to Australia in 1954 as a Dyason lecturer. He said on that occasion that if America spent 1 per cent, of its military budget on peaceful development and on improving the living and economic conditions in South East Asia it would solve the problems in that area. Yet the honorable member for Parramatta said that this area is not ready for revolution although it is ready for development. Unfortunately, this Government and all conservative governments in the world that stand by conservative economic systems have been far too slow. They advance this economic proposition at a snail’s pace. They do it by establishing a conservative economic financial institution such as this proposition.

The interest costs on loans to the Asian nations will be at an average of 5) per cent. How can these poor nations afford to pay this interest burden in order to carry out their development works? The Asian Development Bank will be an offspring of the International Bank for Reconstruction and

Development and of the International Monetary Fund. These institutions arose out of the Bretton Woods Agreement. In 1947, the Chifley Administration led Australia into these financial institutions, but there was a great deal of heart-burning within the Australian Labour Party over this matter, as there is over many matters. At least we have a heart. We think and struggle and try to look at the difficult problems that exist within these propositions. After a great deal of discussion it was decided that we would support the Bretton Woods Agreement.

Of course, the first two institutions that were established as a result of that Agreement were the International Bank for Reconstruction and Development and the International Monetary Fund. The International Monetary Fund helps nations by providing short term loans at the very low interest rate of between 1 per cent, and li per cent. It assists them in difficulties arising from trade balance problems, floods, famines and things of that kind. On the other hand, the International Bank for Reconstruction and Development lends money to countries which it is sure can repay the loans, lt charges interest at a rate between 5 and 5i per cent.

Although Mr. Chifley, at the time when we joined these institutions, thought that we would never have to borrow from the International Bank, we have, in fact, borrowed more than $US300 million. At the present time we owe $194 million. When we look at the countries that have borrowed money from the International Bank, we find that they are countries which are struggling for development funds. At present we owe the Bank $194 million. Ethiopia has borrowed $42 million. One would think that Ethiopia, being an underdeveloped nation of Africa that has many more difficulties than we, would .need money more than we do in Australia. Libya, which is another struggling underdeveloped nation, has borrowed only $3.2 million. Morocco has borrowed §32 million. Nigeria, which has a population four times that of Australia and which has a great deal more problems in development than has Australia, has borrowed only SI 21 million from the International Bank. Sierra Leone has borrowed S3i million. Sudan has borrowed $65 million. Thailand, which is one of our allies ia South East Asia and which has a population twice that of

Australia, has borrowed only $157 million, and Tunisia, another African nation, has borrowed $6.5 million. This Government, by borrowing money from this international agency, has deprived other nations of capital. As the honorable member for Melbourne Ports (Mr. Crean) explained earlier, there is a great shortage of capital in the world.

It was found that these underdeveloped nations could not afford to pay the high interest rate that was charged by the International Bank. So a further world banking institution was created. It was called the International Development Association. It made capital available at an administrative cost of approximately II per cent. This is the interest burden which the new Asian Development Bank should impose. The interest burden should be no higher than 1 per cent, or H per cent. The Asian Development Bank will be the third regional bank that has been established, but it is to be established on the basis of the old International Bank for Reconstruction and Development, which, of course, has an ultra conservative policy.

One could ask: What is the task that faces the Asian Development Bank? 1 quote from Mr. Felix Greene’s book entitled “ A Curtain of Ignorance “. At page 109 he states -

The world we live in today, with all its marvellous achievements, is still a world in which the life experience for most people is one of prolonged suffering.

The facts are sadly familiar to us. Between onethird and one-half of the world’s population suffer malnutrition. Every day some ten thousand people die of malnutrition or starvation - more than at any time in history; in India alone 50 million children will die from lack of food in the next ten years. Two thirds of the human race have an average per capita income equivalent to fifty or sixty dollars a year.

The people of India have a per capita income of between 10 and 13 cents a day. Felix Greene continues -

Seventy per cent of the food growing families of the world still use wooden ploughs or hoes, the least efficient tools for raising food; and only two per cent possess power implements.

Fortunately Australia is part of that 2 per cent. He continues -

A college graduate in India is lucky if he can find work that will pay him more than five dollars a week. Only a very small percentage of the world’s people have access to a hospital when they fall ill. The electricity generated in the whole of the Indian subcontinent would be insufficient for the needs of New Yet City. Women in the United States spend more on cosmetics than the combined total of the African countries that have won their independence since the war.

This gives us some idea of the magnitude of the problem we have to face. The capital provided for this Bank will be insignificant. Felix Greene goes further and says -

Those of us in the advanced Western countries represent a small and favoured minority - 15 per cent of the world’s population, consuming 55 per cent of the world’s goods.

The affluent society can afford $US 1,000 million to create this Bank to prevent itself from revolution, which is what the honorable member for Parramatta said, yet one nation alone is spending $US1,000 million a month on the war in Vietnam. I know that the Soviet Union has increased its expenditure on arms, as have India and Pakistan. We know that this financial year the United States has increased its entire expenditure by 25 per cent. The Australian Government has a fear complex and the more it spends on arms the less secure it feels. There is a challenge to mankind to help the underdeveloped nations but $US1,000 million is like a crumb fallen from the table of the affluent nations of the world. We must face up to the challenge. Half the world’s population is in the Asian area to our north. Greene asks -

How is a poor country to become less poor?

He answers the question by saying -

To begin to lift itself up out of poverty, squalor, and illiteracy, a nation needs to save. An irrigation pump, a school, a bicycle factory, a road, an iron plough, cannot be obtained unless someone has saved money to buy it with. There is no other way.

Is this Bank the solution to our problems? We are not the Government; honorable members opposite are the Government and we support them in this meagre move to try to solve the problem, but the Government must go beyond what it is doing. The honorable member for Melbourne Ports referred to the increasing cost of the imports from the affluent countries coming into the underdeveloped countries while the prices of minerals and raw materials being exported from the underdeveloped nations to the affluent nations is falling. Aid is given to the underdeveloped nations with one hand and taken away with the other. It is well known that magnificent assistance has been given to Latin American countries under the late President Kennedy’s Alliance for

Progress, but American business monopolies are drawing that money back, and the money being advanced by the United States Government and its taxpayers is being completely depleted because the countries that receive it earn so little because of the low prices their exports command.

In the annual report for 1964-65 of the International Bank for Reconstruction and Development and for the International Development Association the following appears -

In 1963 and 1964, export earnings of the developing countries, the largest single source of foreign exchange, rose by 9 per cent in each year, due to an increase in both volume and prices. The greatest increases in the value of exports were IS per cent and 18 per cent in Africa and the Middle East respectively. Export earnings in Latin America rose by. 9 per cent. The smallest increase, around 2 per cent, was in South East Asia.

We live in South East Asia. We are increasing our defence expenditure but we are not by the same proportion increasing our expenditure on economic aid to the nations to our near north. We suggest that there should be an international economic agency linked with the United Nations to distribute aid not only to South East Asia but to all underdeveloped areas. Australia should try to establish a regional group - similar to the South East Asia Treaty Organisation, but with an economic basis - of all nations in the area so that Australia, the most affluent nation of those involved, could pour greater aid into the area. I agree with the honorable member for Melbourne Ports that we should examine the question of trade with the underdeveloped nations. Tariff preferences should be accorded them to assist them to trade with Australia. We support the Government on this Bill, but we believe more importance should be attached to making more money available by way of economic aid so as to remove from the people of the underdeveloped nations poverty, hunger and illiteracy.


.- I think all Australians will applaud this Bill. It is a worthwhile step in the right direction in relation to the development of the countries involved. The honorable member for Melbourne Ports (Mr. Crean) mentioned the present authorised capital of SUS 1,000 million and suggested, as did the honorable member for Reid (Mr. Uren), that this is perhaps a small sum for the particular job of the Asian Development Bank. That is true, but it is a starting point, and Article 4 of the Articles of Agreement of the Bank sets out clearly that the authorised capital of the Bank may be increased by the Board of Governors and indicates how, why and so forth. In my opinion that is a starting point. The best banks in the world today had a starting point, and that is the way in which I regard the measure before us.

Before proceeding any further I want to refer to a particular point raised by the honorable member for Reid. He indicated that India recently had increased its expenditure on defence. That is quite true. In my opinion, it is a tragedy that this has happened, but it had to happen. India, of all countries in the world, requires every ounce of capital it can get for its own development but it was forced to increase its defence expenditure because it was viciously attacked by Communist China. That is the only reason why such a large amount was made available by the Indian Government for expenditure on defence. These are the real facts of life.

I think it is of significance to note that the first clause in the Agreement establishing the Asian Development Bank states -

The contracting parties, considering the importance of closer economic co-operation as a means for achieving the most efficient utilisation of resources and for accelerating the economic development of Asia and the Far East. . . .

That is the crux of the whole matter. That is what the Bill is really about. That is the reason for Australia’s contribution of some SUS85 million. It is also interesting to read Article 1 which relates to the purpose of the Asian Development Bank. It states -

The purpose of the Bank shall be to foster economic growth and co-operation in the region of Asia and the Far East . . . and to contribute to the acceleration of the process of economic development of the developing member countries in the region, collectively and individually. . . .

I think that is the light in which we must look at this Bill. We are setting up a cooperative bank which will foster the development of these regions collectively and individually. We, as Australians and members of Parliament, know the difficulty which Australia has in producing and obtaining sufficient capital, knowhow and the tools of trade necessary for the development of this country. We are only a young country. We are moving forward rapidly but we have our problems in the field of development. We have a great export market in various commodities, mainly our primary products which represent something like 80 per cent, of our total exports. This enables us to import vast quantities of machinery, machine tools and so on for use in our development.

As I have said, we know the difficulties confronting Australia. How much greater are the difficulties confronting countries such as India, Pakistan and others which have a tremendous population problem. While trying to overcome the problem of feeding their huge populations they must also try to develop. While on the subject of population, let us think for a moment about Australia. In an area of something like 3 million square miles we have a population of U million people. There are not many people to the square mile in Australia. In Pakistan, especially in East Pakistan, there are 1,000 people to every square mile. Having in mind the very limited resources that are available we can appreciate . the tremendous difficulties these countries face.

Although our contribution may be only small in relation to the amount required for the development of these countries, it is a worthwhile contribution and it is a start. It is an indication of a principle and a policy and it shows that we are going somewhere in this field. This is not the only finance which is being made available. I think it was the honorable member for Reid who said that this aid was 19 years too late. Various nations in the world have made a vast amount of money available to these countries over the years. I have seen some of the tremendous projects which have been built in Asia and are now in operation. They are not small by any means. The finance for them has been made available by various countries, the World Bank and other bodies. We in Australia have contributed to them. We in Australia have contributed to the Colombo Plan and to similar projects. This kind of work has been going on for some time and it will continue to go on, I understand, with the aid of these additional resources. But here is a new concept, a new bank to be set up for this particular purpose. As I said before, this is only the starting point. I believe that the amount will be increased as time goes on.

Recently Australia gave a lead in the matter of tariffs. It is important to look at this aspect when dealing with a bill of this nature. India, Pakistan and other less developed countries, as we term them as a rule, have had difficulties in trading with affluent countries. The Australian Department of Trade and Industry managed to evolve a tariff schedule which made things somewhat easier for these less developed countries. The schedule has now been agreed to by signatories to the General Agreement on Tariffs and Trade.

Over the years we have seen many of these and other countries of the world striving for their independence. The proposal now before us is a sign of real progress. We applaud and support the step which has been taken. Independently, without having the resources necessary for development, it is unrealistic to think that these countries can survive. This is how we must view some of them. They have their independence but not sufficient capital, technical ability or educational facilities to do the job which confronts them. Besides feeding their people they have to employ their people, build homes, schools, factories, ports and everything else that goes with a developing nation. This is the kind of thing this Bill will assist in doing. It is only by measures such as the one before us tonight that we will make a real impact within Asia and in other parts of the world.

The first responsibility of any nation is to feed its people. One has to travel to some of these Asian countries to realise the tremendous magnitude of this problem. Even if these countries had the best administration, the greatest capital resources and the best technical knowhow available to them in unlimited quantities they would still be confronted with this problem. They are so far behind in their techniques. I think it was the honorable member for Reid who said that they are using antiquated tools of trade in the production of foodstuffs. That is true. They are using the same kind of tools today as were used 2,000 years ago. This has created a tremendous internal problem.

Over the years families have owned or leased land from landowners and have split it up into smaller blocks; perhaps plots would be the correct word to use. I put questions to people in India who should know about this matter and 1 was told that 20 or 25 acres would be sufficient land for a farmer to make a living for himself and his family. In terms of holdings in Australia, this is crazy. We cannot imagine that it is sufficient but they say that the average size of a property in this region is even less than 20 acres. They have small plots of land, they use small ploughs and they still follow antiquated ideas. These things must be rectified. The problem is how to rectify them.

How do you introduce mechanisation into this situation? This presents a tremendous problem. We must introduce mechanisation, but first we must develop these countries industrially so that employment may be provided for more people. At present most of the people are employed on the plough or using other primitive techniques. The foundations for the industrial development of these countries are being laid in the programmes fostered by the World Bank. These programmes include the building of dams for irrigation and the construction of hydro-electric power plants. The power from these plants will be used to run factories. But these are only the first steps in these programmes of development. Following the building of dams and power plants must come factories and it is in this field that this Bill is of value. It will help in the building of factories in these countries. From my observations the people of Asia are capable of turning out the goods if they are given the opportunity. They have great ability in many fields, particularly in the manufacture of textiles. If India had the wherewithall to build factories and import the necessary machinery she could process every pound of wool that we produce. India certainly has the manpower and she also has the technical knowhow. She lacks only the financial resources. This is a matter that Australia should take into account.

We recently made, under the CoLombo Plan I think, a gift of wool to India but it was only a small amount. The wool was given to enable India to process it and export the processed article, thus earning foreign exchange. We could give more help of this kind. A little more real competition in the wool market would not hurt Australia. These Asian countries have ample supplies of manpower. They have the knowhow and the drive and initiative to produce manufactured goods. All they need is an opportunity and they will enter into export trade.

I know that development of this kind produces certain problems. There is the problem of transport in Asia. Roads, railways and ports in Asia are so inadequate as to create transport problems. The World Bank is making loans available for port development, but they are limited. Transport is very important in the development that must take place in these countries. We have made gifts of wheat to India and I hope that we will make more. These gifts have been made in order to help India overcome her food shortage. But the inadequate transport system of the country has made distribution of the wheat to the people difficult. Large silos have had to be built quickly because India does not have adequate modern bulk storage facilities. If we are to continue to pour into India large quantises of grain, as we must - America also has sent vast quantities of wheat - there must be a bank to provide money for the facilities that are necessary to get the supplies to the people.

Article 2 of the Agreement provides that the functions of the Bank shall be, inter alia, to provide technical assistance for the preparation, financing and execution of development projects and programmes, including the formulation of specific project proposals. As I see it, this is an important step. Of course, careful consideration will be given to any proposal before finance is made available. When I was in Asia on a short visit, I inquired how countries such as Australia could best assist Asian countries in their development. Invariably the people who knew the answers told me that what they needed was technical assistance, mainly in the production of foodstuffs. Undoubtedly these countries have a long way to go before they reach an advanced stage of development. In my opinion they have done a magnificent job in feeding their people. If we in Australia had to feed the vast numbers of people who populate some Asian countries we would indeed be battling.

I do not think the techniques that are being adopted in Asia are adequate to cope with the problem. These countries must have technical assistance. Within the framework of the assistance provided by the Bank we must make available people wilh technical knowledge to investigate the programmes to be financed by the Bank. Such people are not plentiful in any country. No country has enough engineers and other technically qualified people. Australia should be training more people in technical skills. For a country such as Australia, which depends so heavily for its economic wellbeing on stock to be so short of, for instance, men skilled in veterinary science, is a disgrace. If we, with our high standards of education, are short of veterinary people, imagine how short these Asian countries are of such people. We must step up our training of such people, not only for our own sake but also to assist the people of these countries which this Bill is designed to assist.

One of the main aims of this scheme is to feed the people of Asia better than they have been fed in the past. Large areas of land in Asia have not been cultivated because they have always been regarded as dry areas. This attitude may seem strange to us in Australia, living as we do in a dry country. Not only must we give these countries technical assistance and the advice of our agricultural departments, our universities and the Commonwealth Scientific and Industrial Research Organisation but we must also give them practical assistance. I am sure that there are in Australia not only men with technical knowledge but also other men who would be willing to go to Asia, if given the opportunity, and help to put that dry continent’, as it is known, into production. Perhaps th3 first step to be taken should be through mechanised farming. Even Ceylon, with a population of 11 million or 12 million people, most of whom live in the south of the island, has a large dry area. This has an annual average rainfall of about 30 inches. It is jungle, but there is no irrigation. It is not regarded as good agricultural land. I am sure that if we step up technical education in Australia, we can provide the men with the knowhow and the practical experience to go to such countries, perhaps for short periods, and, by applying proved methods and with the use of mechanisation, bring them into production.

There are large undeveloped areas in China, which has developed only 25 per cent, of her potential in agriculture up to this point of time, after thousands of years. The same thing must be done in China. Although China is not concerned in this project, it is part of Asia. South Vietnam is another such country, as my colleague has stated. There are large areas of this character in Asia which could be assisted by us. Australia is a dry country, but we have been very successful in bringing into production territory that was considered impossible until a few years ago and was bypassed for hundreds of years by other people as being useless and dry. We have brought it into production - and have only just found the real significance of our techniques - with clover, fertilisers and modern machinery. We can take our skills and techniques as agricultural people into Asia.

Beyond this, Asia needs assistance to build factories. It has the know-how although it may not have the education. In many countries fewer than 20 per cent, of the working people are educated, but lack of education does not stop a man from working in a factory, or even from working efficiently in a factory, and turning out goods required throughout the world. With assistance in trade to less developed countries, with the assistance of this Bank and with real thought on our part for these people, Asia will advance.


.- This proposal for an Asian Development Bank is good as far as it goes, but it does not go very far, so I feel that we ought to be somewhat restrained in expressing platitudes and commendations. What we must realise is that the problem of development of underprivileged countries is grave and of very wide extent. However, a successful solution will not come from a superficial appreciation of this problem and then the establishment of an orthodox capitalist banking institution. The problem of developing underprivileged countries requires far deeper penetration than an orthodox capitalist banking institution is capable of providing. It seems that amongst those people who support this sort of concept as the sum total of all that has to be done in development is the feeling that all of our sins, errors and omissions of the past which have been responsible for the development of these underprivileged countries being held back or being nonexistent can be bought off and that our consciences can be salved by providing a little money. I shall point out later that there is plenty of evidence that providing money from banking institutions at high interest rates adds considerably to the problems of these countries.

I suggest that one of the things that we ought to look at is the possibility of marshalling the resources of these various countries, allocating priorities, and planning development and growth under a planned economy. For the life of me, I cannot see how this so called free enterprise capitalist approach to the problems of these countries will succeed. We shall proceed at a tortoise-like pace and all of the inequalities that have existed in the past and have been such a painful burden to the poverty ridden masses of the underprivileged countries will largely continue. These things are the seeds of despair, revolution and resentment. We must realise that we have to marshal these resources if we are to overcome this problem of pedestrian movement. As a member of a Socialist party I would, if I were in a position to do so, encourage as much as possible the development of Socialist economic planning in those countries, because unless that is done I cannot possibly see how we can create enough investment in them or allocate investment efficiently.

Let us examine the proposals in this Bill, lt will establish a commercial banking institution. Commercial rates of interest will be charged for economic projects. The money will be hard money and not soft money, in the jargon of the banking world. This simply means, to me anyway, that those who will largely benefit from this institution will not be the countries that are terribly depressed and urgently in need of investment assistance in order to develop, but rather the countries that are already mobilised and starting to move, the countries that have established their creditworthiness. This will be of no help to the vast majority of the really underprivileged and impoverished or underdeveloped sections of the world.

I have referred to high interest rates. According to the annual report of the International Bank these rates vary between Si and 6 per cent. These are pretty high interest rates for impoverished countries. If we read the Bill and the Minister’s speech carefully we will find that the countries seeking aid will have to guarantee that the projects they have in mind are copperbottomed. They will have to show a certainty that the money will be repaid and within a relatively short time; 15 years was a period mentioned in the report of the International Bank for Reconstruction and Development. This is a fairly stringent requirement to impose on countries which already have the problem of meeting not only their economic development obligations but also the service costs of loan money previously extended to them. These countries already pay more than 40 per cent, of their net capital inflow as interest, dividends and profits to industrialised countries. This in itself should bring us up with a jerk and cause us to have another look at this Asian Development Bank, this creation that Government supporters tell us will bring about a rapid reformation and a better world for the underprivileged countries of Asia. The simple fact is that while to a certain extent - and it is a fairly limited extent - it does make some contribution to the improvement of conditions in certain countries, it also imposes a burden.

I would like to know something about the people who will be operating this organisation, and something about their philosophy. This is tremendously important. For instance, we do not want in this body people whose philosophy is opposed to public enterprise, because public enterprise is a very important element of the economic growth of many underprivileged countries. From what I can discover from my reading about this subject, when India was establishing its steel industry and sought assistance from the World Bank, the United States Congress applied pressure to, and interfered somewhat with the attitude of, the World Bank towards assisting the establishment of the industry because public enterprise was to be involved. This is not good enough. I think the Indian concept in establishing its steel industry was a thoroughly commendable one. Indeed, we in this country could well study it and apply it with value. I notice that Communist China recently followed the practice of India in hiring technical knowhow and assistance from Germany to establish a steel industry. I am sure the honorable member for Parkes (Mr.

Hughes) will be very interested in that information. When this assistance and technical knowhow has fulfilled its term of engagement, it is paid off. So we do not have this horrible situation of forever servicing overseas debts.

We have this at the present time in this country. We have the resources available to do a number of things to develop Australia. We are not prepared to do this. Instead of that, we are prepared to sell our Australian heritage to overseas financiers. As the honorable member for Melbourne Ports (Mr. Crean) has pointed out on more than one occasion, we are rapidly arriving at the situation where our service costs will pass over the capital inflow to Australia. I refer to the service cost of overseas investment already present in Australia. These things can be avoided. This is the sort of thing we ought to be encouraging: At least, if there are some of us in the world who cannot go along with democratic socialist thinking, we must go along with some of it. This is the kind of thing that is going to mobilise the resources of these underdeveloped countries. The economic growth of these nations must be organised and planned, otherwise we are going to be held back. Our pace will be halted and we will find the support of the people of these countries will be alienated from us. This is what is happening in the race in the world today. I am satisfied that much of the investment which is being made available from western sources is only being made available at the present time because of the pressures of the cold war and the warm war and the other ideological conflicts that are going on in the world today. These influences can be summed up as an element in the international race of ideological influence. At least this good has come out of this international race.

We have an obligation to these countries. It is one thing to set up one of these world banks. Let us look at what we can do within these countries. We have to get to the realities of the problems in these countries. We have to see what we can do to increase the mobilisation of domestic investment within them. We have to see what we can do about raising the domestic investment in terms of direct tax, sales tax and perhaps even cuts in expenditure, although this would have to be a discriminatory feature. The cuts in expenditure that would be involved would relate to the less essential items - the luxury items which have lesser priority in terms of development investment. These countries can impose more direct taxation. They can impose more sales tax on the consumable durables without harshly affecting the people - indeed, they would scarcely affect the people in any way. These people are at the bottom of the socio-economic order. They do not have anything. Most of them are outside the monetised system because of their deplorably low living standards.

Let me give the House an indication of how low the investment rate is in some of these countries. Investment in Africa and Asia runs at about 13 per cent. Making allowance for the fact that Japan and Nationalist China have an investment rate of approximately 30 per cent., we can say that, in actual fact, the African and Asian investment rate is much lower, and probably below 10 per cent. Let us look at the savings rate to see what we can do about lifting this. The domestic saving rate in Pakistan is 10 per cent, while it is between 15 per cent, and 17 per cent, in India. A desirable savings rate is 20 per cent, to 25 per cent. There are many so-called fat necks, very wealthy people, in these underprivileged countries, who pay virtually nothing in direct or even indirect taxation. I refer particularly to sales tax. These people could be making a very wealthy contribution to the economies of these underprivileged countries. These are the people who ought to be compelled to make some savings available for the benefit of the development of these countries. This can be done with these forms of taxation.

If we are to rely on loan money, as the philosophy of the Government seems to provide, then we are going to add, as I mentioned before, to the problems of these underdeveloped countries. I would like to quote from the annual report for 1964-65 of the International Bank for Reconstruction and Development and the International Development Association in relation to the external indebtedness of developing countries which shows that this is quite a serious problem to these nations. The report states -

In 1963 and 1964 the external indebtedness of developing countries continued to increase at a rapid Fate. In a group of 37 countries with a population of 1,100 million, representing almost three-fourths of the population of the developing world (excluding the 1,000 million people in the Sino-Soviet countries), outstanding public and publicly guaranteed debt with a maturity of one year or more rose from $18 billiton at the end of 1962 to S21 billion at the end of 1963, and preliminary estimates give a total of $25 billion for 1964.

Over the last two years, the annual rate of growth in debt was about 17 per cent., compared to 15 per cent, between 1955 and 1962. . . .

For the developing countries as a whole, it is estimated that outstanding public and publiclyguaranteed indebtedness with a maturity of one year and over may have amounted to $9 billion in 1955, $28 billion in 1963 and as much as $33 billion at the end of 1964. This is, however, not an all-inclusive estimate.

There are some reasons why it is not an allinclusive estimate. That really shows that the situation is even more serious than those figures show superficially. The report also states -

While it appears that the rale of growth in debt service payments of those countries has slackened in the past two years, the volume of such payments is now almost four times what it was in the mid- 1950s, and it continues to rise. . . .

For the developing countries as a whole, total service payments on public and publicly-guaranteed debt with a maturity of one year and over are estimated at about $3.5 billion in 1964. A large proportion of this outstanding debt consists of medium and short-term maturities. If allowance is made for the liquidation of commercial arrears and similar short-term obligations, aggregate debt service payments may easily have amounted, in 1964, to well over $4 billion.

So we can see that the situation is really quite serious for the developing countries, lt is all right to borrow from outside to bridge the gap between savings and investment provided the gap is closed before the accumulated debt reaches unmanageable proportions. 1 remember reading recently that India’s big problem is that she has to keep borrowing at an ever increasing pace just to service her existing debt, which has arisen from loans raised in the past. That hardly seems the way to solve this sort of problem. If we are to make loans to these countries, the things that are needed are longer periods of grace, longer amortisations and low rates of interest, lt does not seem to me that those things are provided in this Bill. .1 repeat that the Bill says specifically that the money provided will be hard money and that only 10 per cent, of the capital of the Bank will be used for loans on softer terms. After reading the section of the Agreement that refers to the softer terms, it appears that it will be fairly difficult for countries to borrow money on these softer terms.

I turn now to another matter at which we should look when we are considering aid. This Asian Development Bank at least has the virtue that it is a multilateral association. I believe that it is about time we had a rather critical look at bilateral aid. One of the problems of underdeveloped nations is the way in which bilateral aid is foisted on to them with rather onerous strings attached to it. Some of the underdeveloped countries are not prepared to accept as much bilateral aid as is available to them.

I am referring to the type of aid that is given by countries that say to developing countries: “ We will lend you so much only if you take what goes with it and if you take it on our terms. You will do these things with it.” But those things may not fit in with a sensible scale of priorities for the developing countries. The conditions c.m be so onerous that the developing countries are somewhat reluctant to accept the bilateral aid. If bilateral aid is to be given, it would be far better to give it in the form of straight out money grants. However, the proportion of money grants in bilateral aid declined from 60 per cent, in 1962 to 54 per cent, in 1964. So the amount of bilateral aid that is going to the developing countries in the form of loan moneys is increasing. These loan moneys particularly have strings attached to them.

The problems confronting these developing countries can be seen when we look at their income figures. The ratio between the income per capita per annum in India and that in the United States was 1 to 15 in 1938. Now it is 1 to 35. We find that two out of three people in the world are poverty ridden. And these are the people in the underprivileged countries. We see the industrialised nations with an average per capita income of $US 1,900 a year and the underprivileged or non-industrialised countries with an average per capita income of only SUS130 a year. It is estimated that in another decade things will improve for the underprivileged countries and that they will achieve a figure of SUS800 a year. But the gap between them and us will widen nevertheless, because the industrialised nations will have an average annual income of SUS4.000 a head. In 1955, the underprivileged countries were indebted to the extent of 7 per cent, of their gross national product. This indebtedness is now rising towards the level of 20 per cent. This is the big problem that these countries have. These are the realities of the situation. Yet these are the things that we are not probing. We are just accepting the superficial appearance of the situation. As a consequence, we are proposing a very inadequate solution to these problems.

I would like to illustrate the extent of the advantages that we can expect from a sensible aid programme. I heard the honorable member for Melbourne Ports ask whether it was more desirable, more beneficial or more remunerative to put $400 million into armaments or $200 million into aid. I favour the latter. In this, I support Paul Hoffman, Managing Director of the United Nations Special Fund, who, in his book “World Without Want”, stated - it is past time that the national budget planners of the industrially advanced nations, and the politicians upon whom rests the responsibility for approving budgets in the democratic societies, recognise that the best and least expensive longrun defence of their national interests lies in the creation of a world in which poverty, deprivation, illiteracy and disease are not constant provocations to violent and destructive upheaval.

Indeed, H. G. Wells said that civilisation depends on the outcome of a race between catastrophe and education. In passing, with respect to education, it is worth noting that more than 400 million children in the world today have no school to attend. There is a tremendous problem of illiteracy. At least two fifths of the world’s population, or more than 700 million adults, are illiterate, and the number is increasing by 25 million a year. India, with three quarters of its population illiterate, has more than one third of the world’s illiterates. These are the problems that we ought to discuss when we are talking about aid for the development of the underprivileged countries. We should not be content to talk in terms of conventional, conservative banking institutions which will only loan money on the basis of credit worthiness, anyway. They will lend only on the basis of a guaranteed return in the near future. Under such a system, the people who really need the sort of atd envisaged under the terms of the Asian Development Bank Agreement will not receive it. The requirements for aid in this world run at a much higher figure than is presently being provided for. It has been estimated, as is stated by the International Bank for Reconstruction and Development in its last annual report, that another $3 billion to $4 billion a year in aid for developing countries is required in addition to that at present being provided. But this is only the minimum level - the holding level. At least another $20 billion more than is now being provided will be needed before we reach the takeoff level. This is what we ought to be aiming at.

We could look at a whole host of things under particular heads as contributions to help the underdeveloped countries. As I implied before, capital banking institutions will not do what is required. We must get to the realities of the problems of the underprivileged countries. We must get right down to the basis of their economic structure and of the world economic order if we are successfully to contribute aid. We must do something in terms of commodity agreements. The underdeveloped countries need guaranteed prices for the commodities that they produce. Most, if not all, of those countries are primary producers. They are exposed to the vagaries of world prices and to the rapid fluctuations that occur from time to time. In 1957-58, the United States and Western Europe suffered a recession. The result was a sharp reduction in the demand for the products of the underdeveloped countries.

This, of course, caused a fall in prices. The result of this was a loss of foreign exchange for the underprivileged countries, which in one year exceeded in value all the previous loans received by those countries from all sources. If I may quote from a United Nations report, an African speaker at a recent conference of one of the United Nations bodies explained that if the price of the basic food commodity produced in his country could be pegged at a minimum of $250 per ton, or only half the 1954 floor price of $500 per ton, the income of his country from this product alone would be increased by at least $20 million a year or, over a seven year period, by more than $140 million and this would enable the country to finance a sizeable proportion of a seven year development plan without resorting unduly to foreign aid.

We have to seek the elimination of discriminatory tariffs and be prepared to accept more commodities from underprivileged countries. If need be we must accept their products in competition with what we are already producing here. 1 recall that the passionfruit growers of Australia were successful in having a ban or some sort of control imposed on the importation of passionfruit pulp produced in New Guinea. This is undesirable. This country, most of all, has a very heavy obligation in the development of New Guinea and we should be prepared to accept its products into this country. The developed nations of the world have an obligation to do this sort of thing on a widely organised basis and to speed up the process. At the present time there are movements on foot towards liberalising tariff barriers, but if aid is to be given the most desirable way of providing it is on a multilateral basis. This would eliminate the trouble I have complained about previously; that one country provides aid on a bilateral basis and then attaches strings to it. It would eliminate the suggestion that the aid is being provided for political purposes and that political pressures are being applied in conjunction with the giving of the aid. Aid provided on a multilateral basis allows a country to keep ils sense of independence and its pride and this is very necessary.

We have had instances of successful multilateral aid programmes, such as the Mekong River programme and the Indus River project. We have to fight to lower shipping freight rates, insurances and all the other charges connected with the export of commodities from underprivileged countries. We, in Australia, have complained about these things in the past. They constitute a very serious problem for us in the terms of competition on international markets. So how much more serious are they for the underprivileged countries depending largely on the export of primary commodities which are subject to world gluts and sharp movements in prices?

We, as a nation, ought to support the acceleration of moves towards disarmament. The sum of $120 billion a year is spent on armaments by the nations of the world and that equals one-quarter of the national income of the under-developed nations. Again I shall quote from Mr. Paul Hoffman, who belongs to one of the United Nations special aid agencies. In a recent United Nations report on the amount of money required for the development of under-developed countries, he said -

The amounts involved are much less than many people believe. The immediate need of the United Nations family is for an increase of only $100 million a year in its free investment expenditures - 50 per cent, above the current level.

That additional $100 million is but onethousandth of what it costs every year to maintain the military establishments of .he great powers. Yet this relatively small amount would be a potent long range investment in peace and security.

I do not see any reason why we should not try to apply those influences which will accelerate movements towards disarmament’. Indeed, as I said recently in this House, we ought to have a Ministry of Disarmament and Aid to Underdeveloped Countries. We ought to see whether it is possible to establish some sort of aid body, internationally operated on a multilateral basis. Contributions would be made by the developed countries. The prices we pay for commodities such as primary products from underprivileged countries are deplorably low. They are unfairly low. In fact our living standards are being subsidised by the underprivileged countries. The difference between these low prices, which are exploiting prices, and what could be regarded as being reasonable prices should be paid into this international body as a contribution from the developed countries and then should be distributed by the international body on a multi-lateral basis - a no strings attached basis - to assist the underdeveloped countries.

If this Asian Development Bank is to have any real effectiveness for the people of the underprivileged countries, we need some guarantee that it will have a technical assistance section to ensure the most effective utilisation of aid provided from this source. We do not want a repetition of what happened in the Philippines, in Taiwan and in Indonesia, when steel mills were established in unsuitable localities and with a capacity for far greater production than the markets in the areas could ever use. We have seen many cases of unsuitable development. We have seen it in Ghana, where President Nkrumah engaged in prestige projects with long gestation periods such as the Volta Dam. We have seen tremendous expenditure on prestige aircraft. Of course, construction of unnecessary prestige buildings is not confined to the underdeveloped countries. We do quite a lot of it in Australia.

We have to ensure that subsidiaries of companies in developed countries which go to underdeveloped countries use the most efficient and up to date equipment when they are carrying out the various activities in which they are engaged on behalf of the parent bodies. I am thinking in terms of people who go searching for oil, of those who establish steel works and of those who exploit some of the natural resources of these countries.

Mr DEPUTY SPEAKER (Mr Mackinnon:

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


.- Money ought to be a catalyst for development in this age and generation, not a millstone for the next one. I am afraid that the architects of the Asian Development Bank, laudable as their aims may well be, showing as they do international co-operation of a sort, are not making much progress towards removing the disabilities of the peoples of Asia. The peoples of Asia comprise the greatest proportion of the peoples of the world. I wonder how far this Bank will go in the immediate future or in the long term towards relieving the problems of countries such as India, Iran and Pakistan.

What are the needs of these people and how are we going to tackle them? I agree with the speakers from this side of the House that the approach by way of the Asian Development Bank is one of conservatism. It is traditional. It will simply use the techniques of the West - the richest part of the world - in an attempt to develop one of the world’s most underprivileged areas. What kind of things does India need? India has millions of people. Her population is about 470 million. She has 220 million cattle, or so I was told when I was there, and perhaps only 20 million of them have any productive capacity at all. She has a population rising at the rate perhaps of 9 million a year. Her own leaders remark that Indians have to run as hard as they can just to stay in the same place. India is a country with a tremendous potential for production. Travelling from

Yugoslavia, probably the first country one sees where parts of the land look lush and green and have a good potential is India. But India has tremendous problems. We are inclined always to lay the blame on the Indians themselves. We say that they are too conservative, that their religious dedication to the cow produces problems and that their failure to adopt satisfactory methods of birth control is causing the great rise in population. India, of course, poured its wealth into the coffers of the world for the last three or four centuries. She has been regarded as one of the world’s store houses for the last 300 or 400 years. She has produced tremendous wealth for other peoples in the world.

It would be little enough indeed if some of it were repaid in a much more gracious and generous way than through the spirit of the international banking system, at interest rates. India could use all sorts of projects such as the construction of great dams, and machinery such as bulldozers, but my own observations there led me to believe that the Indians need much humbler and simpler tools. A shipload of barrows, shovels, spades and picks would be of much more use to the citizens of India than a shipload of bulldozers. It would be simple to increase the output of many areas of India by giving to the citizens some of the ordinary things of life to which we have become accustomed.

I have visited a village in India. I believe that if we supplied that village with 500 or 600 yards - or even 200 or 300 yards - of half inch water pipe, an electric pump and a dozen taps we would revolutionise life there. Countless numbers of people are to be seen working on the roads, carrying material in baskets. If bulldozers were supplied, the work would be done much more quickly, but the local citizens would be thrown into unemployment. So far nobody has had the wit or the will to resolve the problem of that kind of unemployment. Their output could be quadrupled by giving them wheelbarrows, or better picks and spades. The same is true of a carpenter I saw there. He was working with a wood plane which I, who have very humble technical capacity in this field, would have thrown away. He was producing quite artistic and valuable work with the most archaic, outdated and obsolescent material

Probably in Australia countless things are thrown away which, if put into the villages of India, would double their productive capacity. I believe this to be one of the errors of international development. The decisions are made by people whose experience is gained with the kind of things we are familiar with; in other words, we think of great projects such as dams, and machinery like bulldozers. We think of projects of some magnitude, whereas I believe that for most of the people of Asia the first thing to do is get down to the ground and give them their immediate needs. I do not see the need for machinery to do that.

I have examined the schedule which lists the nations involved in the Asian Development Bank. The list contains the names of nations we do not recognise, such as China, North Vietnam, North Korea and Mongolia - an area of 5 million square miles, containing nearly 800 million people, or about one quarter of the earth’s population, and one eleventh of the earth’s arable surface. We have yet to cross a lot more frontiers before we get to the stage of real self congratulation which I have heard from the other side of the chamber tonight.

Iran, for instance, is a country which looks as if it has been eaten out for centuries. It looks as though for 2,000 or 3,000 years the farmers and other people have used all the resources and have not ploughed anything back. Most of the country appears to be well watered. Therefore a lot of it has the kind of potential we do not expect to find in the back country of Australia. Iran has a population of 26 million or 27 million. In many areas of it, by the introduction of simple irrigation schemes - down to earth improvement amongst the villages - a remarkable increase in the standard of living could be produced. The same is true of Pakistan.

I would like to see a simpler, more matter of fact, down to earth approach to the problems of these people. There is a sheer lack of thought in some of this planning through what have become propaganda mediums that are developing in this part of the world. One-third of the world’s population is producing less than 2 per cent, of the world’s industrial output. This point was made by the honorable member for Canning (Mr. Hallett). What are the kinds of factories that these people need? 1 believe there is a need, as in the field of developmental works, for a simpler approach. The industrial output per capita is the lowest in the world. The disparity between the rich and poor nations is increasing, as I think the honorable member for Oxley (Mr. Hayden) has pointed out. I shall cite some simple figures, while we are thinking of the magnitude of the Asian Development Bank and the capital which is to be placed at its disposal. The Economic Commission for Asia and the Far East Asian Conference on Industrialisation held in December last estimated that to raise national income by 2 per cent, a year will take $6.6 billion - to use the new financial jargon - annually for industrialisation and more than $1 billion for agricultural development. So some $7.6 million will be required annually just to raise the standard by 2 per cent. That is a pretty humble rate of development. The savings in the whole area are only in the vicinity of $790 million, so there is a short fall of nearly $7 billion a year. We are establishing a bank that will have a working capital of $1,000 million.

Mr Crean:

– To start with, the capital will be only half that amount.


– Yes. It will have $500 million. What does this mean in the world at large? We are spending about $1,000 million, I think, on the development of the Snowy Mountains scheme, lt is time we started to get our priorities in proper order. If the people of Asia start to develop and if there is a surge of progress in this part of the world, in another 20 or 30 years, we will be pleading with the people of Asia to buy our wheat and the other products of our primary industry. In the long term, the assistance we give will be to our interest. In the short term, it is a matter of the common call of humanity. The figures contained in the. E.C.A.F.E. report show that there is a lack of skilled manpower in the area. In the next five years, 385,000 engineers, 2.9 million technicians and 8.2 million craftsmen will be needed.

I believe that the idea of assisting the under developed countries through the banking system is too narrow. I believe that banking is the rich man’s technique and that we should find a new approach. What are the traditional standards of banking? A borrower must have collateral and guarantors and he must pay interest. Article 14 (vi) of the Agreement shows the position. It states -

In making or guaranteeing a loan, the Bank shall pay due regard to the prospects that the borrower and its guarantor, if any, will be in a position to meet their obligations under the loan contract;

With the problems that this area faces, how can this be guaranteed? Apparently, we can still lend only to people who have some guarantors behind them. But it is the people without any guarantors but with the objective of raising their standard of living and reaching the logical aspirations of humanity whom we should be trying to help. This is the challenge that goes out to the economists of the world.

The real problem in Asia is the provision of food. The best assistance we can give to the people in this area is to give them adequate food so that they may raise the standard of their physical development, mental capacity and all the other things that go into developing a human being. In the final analysis, development will lie with the human beings themselves. Schedules to various documents issued by the United Nations show the amount of protein and the calories that the people in Asia consume. We can compare this with consumption in Australia. We can look at the physical capacity of the average European, Australian or North American and compare it with the physical capacity of the average Asian. I have figures showing the amount of meat consumed by people in Asia. I think that this is a fair measure of the physical capacity that people can develop. It has a bearing also on the features that are ancillary to physical capacity. In Ceylon and India, meat consumption is only two kilogrammes a year per person, in Pakistan 4, in Japan 8, in Taiwan and the Philippines 16, and in Australia and New Zealand 109 and 113. I believe that the problem we should try to solve is how to get to these people enough food for them to survive and to give them some zest for life. The economic problem is not so much how many bulldozers we can supply or how many dams we can help them build, but how much food we can supply and on what terms. This is the real economic problem that we face.

I recall speaking to the Deputy Chairman of the Planning Commission in India, Mr. Ashoka Mehte. He said that what India really needed was about 1 million tons of wheat a year on the lowest possible repayment rates. He said that India would not beg for it - that the people of India did not want charity. He told me that 1 million tons of wheat provided to India would release some 2 million people - I think that was the figure - from the task of trying to grow wheat where wheat ought not be grown and they could be used in some developmental work that would help to produce a higher standard of living. They could be putting roads into villages, building schools and sinking wells. Perhaps they do not need dams as much as they need wells - at least, until they can get pipelines.

Australia, with all her productive capacity, has not been able to resolve this problem of supplying the people of India with wheat. Of course, we can supply wheat to China. Indeed, she is almost our best customer. China is able to pay for her wheat. In the long term the people of India will be able to pay too. But in the short term, to give stability, prosperity and food to India is probably the best payment that we can make to the people of Asia. India has an almost stable parliamentary democracy and, I believe, is the hope of Asia. We must resolve this question of giving food to the Indians on much the same terms as we now extend to the farmer in Australia. If we can stack wheat in silos around the Australian countryside and give the Australian farmer an advance upon it, then I presume we can stack it in the stomachs of the Indians and still give the farmer an advance upon it. Australian primary industry has a great capacity to expand. One of the inevitable characteristics of humanity is its capacity to expand its food supply. It is of interest to look at figures relating to the production of rice and wheat in some of the countries of Asia. India produces, I think, 36 million tons of rice a year, or nearly four times the quantity of wheat that is produced in Australia, despite the fact that she is only one-third the size of Australia. I believe that the future of Asia lies in its capacity to produce and its right to consume food.

I have risen tonight to put these simple propositions before the House. I hope that in our consideration of these matters we will remember that no solution will be found in the traditional techniques of the banking system, lt is proposed that people shall pay interest. I have no doubt that the rate of interest will be an economic one. One notes that the money will be paid into a fund which will demand the payment of interest. There is no future for the people of Asia in this proposal, laudable though the objective is.

The Schedule to the Bill, which includes the names of 33 countries, indicates the degree to which international co-operation has been developed. In Annex A at page 39 of the Bill provision is made for Burma and Mongolia, as regional countries, to become signatories to the Agreement in accordance with Article 63. Do honorable members realise that Mongolia is the only country in the United Nations which Australia does not recognise? As far as I could determine, the only delegation to the recent conference of the Inter-Parliamentary Union in Australia that stayed in this country to look around was the Mongolian delegation. In the Agreement we are able to see that negotiations have been going on right across the board in a way that we cannot find in the Department of External Affairs.

Mr Erwin:

– Why does the honorable member always make a plug for the Communist countries? non-Communist China. I believe that until we get around to this standard of belief in international affairs there is no hope for us. The most important and urgent task is to get people to cross the barriers of politics and face the simple problems of humanity. As one of the wealthiest nations and one of the most secure geographically I believe it is our bounden duty to do this.

Our payment into this international fund is miserable in the extreme. It is a mere $85 million. Honorable members opposite may say that that is a large amount, but it Is little more than the cost of the Tullamarine Airport. It is not much more than the cost of introducing decimal currency. It is a very small mite indeed from one of the wealthiest nations in the world. I hope that the honorable member for Ballaarat (Mr. Erwin), who represents an area which in its time has shown great determination in establishing human rights and freedom, and which has dragged from the bowels of the earth countless millions in gold for the wealth of this nation, will start to bring some of the spirit of that great city to this House instead of sitting there barking and bleating that human beings have to be crossed off the list because their politics happen to be those of which we disapprove.

Debate (on motion by Mr. Hughes) adjourned.


– I happen to be concerned about people. It so happens that this Government refuses to recognise a number of countries that have Communist Governments, but it is quite happy to negotiate with the Governments of other Communist countries. The Minister for External Affairs (Mr. Hasluck) has just announced that we propose to make diplomatic exchanges with Yugoslavia. We have had exchanges with Russia for a long time. We supply to the people of China wheat, wool and anything else that can be got from the honorable members electorate and for which payment is made. In my view, we must recognise all the countries and all the people of the world, even though they include many of the honorable member’s friends whose politics I view the dimmest possible light. Portugal and Spain have as much right to be in the comity of nations as has Australia, New Zealand. Britain, Communist China or

page 1350


Overseas Investment in Australia - Answers to Questions.

Motion (by Mr. Howson) proposed -

That the House do now adjourn.


.- It is a matter of the greatest urgency that the Government and people of Australia should know what parts and how much of Australia are owned and controlled by overseas investors. They should know how rapidly the rest of the country is passing into foreign hands. The Vernon Committee has pointed this out. The Deputy Prime Minister (Mr. McEwen) has suggested the establishment of a financial corporation that would regulate the control of investment by overseas and local investors. He believes that unrestricted inflow of overseas capital can be a danger. He says these things outside this Parliament. When I have said them inside the Parliament I have been charged by the Minister for National Development (Mr. Fairbairn) with ranting and raving about foreign takeovers of Australia.

Sir Ian Potter is reported in the Press, I think of today’s date, as saying that the substantial degree of overseas ownership of Australia’s industry has raised doubts as to the future of this country’s economic independence. According to the Press the Government is now considering Japanese requests for taxation concessions in the form of double taxation arrangements that will encourage the takeover of Australian industries and land by Japanese investors. I am not saying whether these things are good or bad. Recently I asked the Treasurer (Mr. McMahon) the following question -

  1. What is the (a) value and (b) area of the rural lands of Australia owned overseas?
  2. What is the (a) value and (b) area of leaseholds of Australian lands held by overseas interests? ?. What is the value of real estate in towns and cities of Australia owned overseas?

The answer given by the Treasurer stated, in part -

I am informed by the Commonwealth Statistician that it has not been practicable to compile reliable comprehensive statistics relating specifically to overseas investment in Australian real estate.

He is saying in other words that the Government has not the slightest idea. I contend that it should be easy enough to gather the information required from the land tax authorities and municipal bodies that certainly must have this information as to the ownership of land throughout Australia. The Press stated recently that at least 57,000 square miles of the Northern Territory was under foreign control. That was before foreign investors recently took over thousands of square miles of the far north of Australia. The Press also stated that vast areas of urban and municipal land throughout Australia were foreign owned. The Press did not know exactly how much land was so owned but it knew that it was a vast area. The Government should be in a position to provide information on these matters. Recently I asked the Treasurer -

What is the present value of investments purchased in companies in Australia with the following yearly inflows of private overseas investment and then I give figures increasing from £38 million in 1947-48 to £42 million in 1948- 49, £68 million in 1949-50 and £258 million in 1964-65. In reply to that question the Treasurer stated -

In the absence of established market values, it is not practicable to calculate the “ present value “ of investment in companies in Australia, whether Australian or overseas owned, . . .

These are things we should know if we are to appreciate the extent of foreign investment in Australia now and whether further investments and take overs should be encouraged, lt was stated in this Parliament recently that 90 per cent, of the money invested in Australia is supplied locally. That statement has been repeated by more than one Minister. Official figures show that between 25 and 30 per cent, of Australian industry is owned overseas. If 30 per cent, of Australian industry is in overseas hands, I am unable to reconcile that with the estimate that overseas investors supplied only about 10 per cent, of the money invested in our industries in any one year. lt seems obvious that the extent to which foreign investment in Australia has appreciated is vastly out of proportion to the increase in the investment of local money.

There is a big move at present by Japanese interests to secure taxation concessions in the form of a double’ tax agreement. What advantage will a double taxation agreement give to Japanese investors and to what extent will Australia’s finances suffer? We should know these things. We should also know to what extent the granting of taxation concessions to overseas investors will increase our imports or our exports. These things should be known, at least to the Government if it is going to widen the field of tax concessions to overseas investors. After all, Japan will not be alone in pressing for investment concessions. They will be sought by other nations as well.

The Minister for Trade and Industry (Mr. McEwen), who is the Deputy Prime Minister, said recently that he was in favour of the creation of a corporation to regulate and channel Australian and overseas investments in this country. Of course, that merely means the adoption of a method that was forced upon the people of Canada by the excessive take overs of Canadian industries and Canadian land by investors in the United States of America and elsewhere. We should know what is happening here. The Government should at least make statements to show the Australian people exactly what the position is in connection with overseas investment in Australia at the present time. This information should be available before we decide whether we should have a corporation for the purpose of regulating overseas investment in Australia - before we decide to what extent that corporation should operate, in what fields it should operate and to what extent, if at all, it should be a regulator of foreign investment in Australia. 1 desire to put those facts before the Parliament because I consider that the supply of information about overseas control of Australia, its industries and lands, is a matter of paramount importance and because I believe that the Government should make available such information so that we can judge whether we are receiving sufficient or too much foreign capital and whether we should, through the extension of double taxation agreements with Japan and other countries, encourage the flow into Australia of increasing amounts of overseas capital, which inevitably would come in the form of imports.


– I am sure that the honorable member for Scullin (Mr. Peters) has his heart in the right place - on this subject at least. It is a pity, I think, that his tone was a little unfair to the Government and that his formulation of the problem was, perhaps, a little imprecise. It is unfair to criticise the Government for lack of information on this subject when the Government has provided very much more information than was provided by all previous governments put together. I am referring not only to the monumental work published recently by the Department of Trade and Industry on this subject, but also to something which, apparently, the honorable member does not quite understand. The balance of payments figures have been produced by this Government in a much better form than ever they were produced before. If the honorable member will think for a moment, he will realise that the balance of payments figures show the amount of money that is being poured into Australia by way of overseas investment. He has only to take the balance on current account and correlate it with the changes in our bank balance - our overseas funds - and he will be able to answer with very fair precision the questions which he has tried to pose to the House. The information is available to answer those questions. What the honorable member does not realise, perhaps, is that if our balance on current account is negative - if in point of fact we are overspending on current account - either we have to draw on our reserves balances, if they exist, or we have to get foreign investment to make good the deficiency. We ‘have, over past years, had foreign investment to make up this deficiency. If we had not had it, we would have been bankrupt.

Mr Cope:

– What about luxury imports?


– I will come to those. It does seem to me that the honorable member should not be talking about this kind of thing; rather he should be turning his mind to a real policy which could, in itself, change our balance of external payments. Unless he does this, it is no good his inveighing against foreign investment. If we had not had this foreign investment we would have gone bankrupt. This is the plain truth of the matter. It would be better, perhaps, if the honorable member turned his mind to ways and means of making it unnecessary for us to have this foreign investment and if he and his Party were to think more in terms of real Australian productivity. This is the crux of the matter. Real Australian productivity should be in the mind of the Labour Party. It is not because, as honorable members know, the Labour Party, through its various affiliations, is one of the things that sprags Australian productivity and therefore reduces the standard of living of the Australian people.

I regret, incidentally, that the honorable member in his speech a few moments ago did call upon the Government to delay the setting up of an investment bank, which does have some part to play in this matter in a way which I will try to explain to him. The honorable member has. I think, displayed considerable ignorance - but with good intention, and I give him credit for having a good heart in this matter - on this question in the past in his constant criticism of the Government for endeavouring to raise loans overseas. The raising of loans overseas is an alternative to the celling of Australian equities.

Mr Peters:

– This is political humbug.


– The honorable member does not seem to understand this. 1 am trying to explain it to him. Apparently he regards this with some resentment. 1 will do my best. If we can raise loans overseas, then we can use them to redress our debts on current account. The raising of loans overseas does, therefore, reduce the necessity to sell Australian equities. The honorable member does not realise that he has been talking against himself so much in this regard. Here is the real point. If we can raise more of our overseas needs in terms of debentures and loans, which the honorable member has opposed so often in the past, we will have less cause to sell Australian equities which the honorable member, I think rightly, opposes now. He is getting in his own way because although his heart is in the right place, he does not seem to understand the nature of the problem. If we can return-

Mr Peters:

– What an arrogant humbug you are.

Mr SPEAKER (Hon Sir John McLeay:
Mr Peters:

– I object strongly to the honorable member’s remarks.


– Order! The honorable member will resume his seat.

Mr Peters:

– I raise a point of order. We cannot be insulted continually.


– Order! The honorable member will restrain himself.


- Mr. Speaker, I can assure you that I do not resent this. The honorable member may find that the salt hurts a little, but it will do him good. Let us consider this matter. If we can get further debenture money from abroad, it will be unnecessary for us to sell Australian equities to the extent that we have had to do in the past. I am on side, to some extent, with the honorable member. I believe that it would be a good thing if we did not sell so many Australian equities, but in order to avoid this and also to avoid bankruptcy, either we have to change the real nature of our balance of payments - and this requires, above everything else, a productivity drive because we do not want to reduce the standard of living of the Australian people - or we have to raise more funds abroad in the form of debentures and loans. If we can do this, then it will be unnecessary for us to bolster up our holdings of foreign exchange by the sale of Australian equities. This is something that the honorable member for Scullin and I both find some reluctance in accepting. I hope that I have not offended the honorable member. I have not done so deliberately. I have only tried to explain to him some of the fundamentals of this problem, because we have something in common in our objections in this regard. 1 appeal to him to withdraw his obstruction to the Government’s proposal to go forward with investment banks and other means of getting Australian investors to retain their equity. A few moments ago the honorable member said: “ Let us postpone this until we get more information “. I point out to him that the information he is requiring regarding the total amount of investment is already available to him in the accounts that have been published by this Government and wherein this Government has done more than all past Governments put together to show the truth of the matter to the Australian people.

Mr Peters:

Mr. Speaker, I claim to have been misrepresented. At no time did I say that I was opposed in any way to the immediate creation of a corporation for the purpose of channelling investment in Australia into the avenues into which it should go. The honorable member for Mackellar (Mr. Wentworth) creates bogies, then knocks them over and says: “ What a great man am I “. He is just a humbug.


– Order!


.- I did not rise to speak on the subject matter discussed by the honorable member for Scullin (Mr. Peters) and the honorable member for Mackellar (Mr. Wentworth) but I could not let the splendid contribution made to tonight’s debate by the honorable member for Scullin go uncomplimented Neither could I resist the temptation to reply to the charges made by the honorable member for Mackellar. I suppose that the need to avoid getting foreign capital is the reason why the honorable member for Mackellar - the most bitter Red baiter, so we are told, in the nation - subscribes unreservedly to selling wheat and wool to Red China and to other places. I should have liked the honorable member to have explained why he conscripts kids to fight the people to whom he is selling wheat and wool while at the same time making no criticism of the Government for its actions but criticising members of the Opposition for certain activities. Tonight he attempted to undermine the brilliant speech of my colleague.

I should like to know the reason why we must export more and must avoid an influx of capital according to the policy of the honorable member. Is that why he sits there and supports a Government that is selling wheat and wool to the people he claims are shooting down Australian servicemen? He tries to attack the honorable member for Scullin to draw public attention away from the bigger issues. He has a guilty conscience and that is the real reason for his attacking the honorable member for Scullin who speaks with knowledge and authority on the subject of foreign investment. No member of this Parliament has a greater knowledge of the subject, and in every debate on finance and on foreign investment the honorable member for Scullin rises to protest against the selling out of Australian assets to foreign investors, be they Japanese or anyone else. Everybody knows that the Northern Territory in many ways is practically foreign controlled, as are many of our major industries.

The Minister for Trade and Industry (Mr. McEwen) recently published a booklet setting out the amount of money from Japanese investors in Australian companies. It occupied hundreds of pages of print. If Australia ever goes to war against the people that members opposite say will be our enemies, they will be manufacturing the materials in Australia to shoot us down because of their capital investment in Australian companies as a result of the Government’s policy.

Members opposite have been in office for 16 years. Yet they blame the Opposition for what is happening in respect of foreign capital investment. The honorable member for Mackellar blamed the workers of this country for foreign investment in Australia. If he thinks that there is no substance in the statement of the honorable member for Scullin, let him know that the Leader of the Australian Country Party - the Acting Prime Minister - has at Country Party con ferences condemned the policies of the very Government of which he is a member. Publicly he, has criticised the Prime Minister. He said that the Prime Minister was allowing this country to be taken over by foreign investors. That is what the honorable member for Scullin was protesting about tonight. The patronising speech by the honorable member for Mackellar will not take anyone’s mind off the facts. All honorable members opposite have guilty consciences because of sales of goods to people with whom they say we are at war. So he decided to attack my reputable friend, the honorable member for Scullin, to hide the Government’s shame at selling out Australian interests to foreign investors while at the same time trading with the enemy

Now let me say a few more things to honorable members opposite. I am sure, Mr. Speaker, you will be shocked at the Government’s dilatory approach to supplying information to the Opposition in the form of answers to questions on the notice paper. I wonder whether the people of Australia know that there is still unanswered a question which the honorable member for Hindmarsh (Mr. Clyde Cameron) placed on the notice paper as long ago as 27th October, 1964. You must be shocked, Mr. Speaker, to know that the people who voted you into office from the Government side of the Parliament cannot be bothered after 18 months to reply to an important question on the notice paper. On 10th November 1964 - 17 months ago - the honorable member for Hindmarsh placed two more questions on the notice paper. These also remain unanswered.

The question notice of which was given on 27th October 1964 was directed to the Prime Minister. If the previous Prime Minister could not answer it, do we not have the white hope of the Liberal Party now holding the office of Prime Minister? Will it take him another 18 months to answer the question? The other two questions to which I have referred were directed to the Minister for Territories (Mr. Barnes). Everyone knows why he cannot answer them. It is common knowledge that the previous Prime Minister shuddered every time the Minister stood up in the House to reply to a question without notice. But even if he were a nervous wreck on the floor of the House from time to time, surely he could give some kind of an answer after 18 months. That is not unreasonable. The Government is treating the Parliament with contempt. You know, Mr. Speaker, that this would not happen in the Mother of Parliaments in Great Britain. In fact, it would not happen in any other country in the world.

On 15th September 1965, seven months ago, the honorable member for Barton (Mr. Reynolds) placed a question on the notice paper directed to the Prime Minister. On 28th September 1965 another question was directed to the Prime Minister by the Deputy Leader of the Opposition (Mr. Whitlam). 1 will tell the House why that question has not been answered. It has not been answered because every time the Prime Minister looks at the honorable member for Dawson (Dr. Patterson) he realises that he has to dodge the question. The Deputy Leader of the Opposition asked -

  1. Which officers have retired from the Commonwealth service in the last ten years in order to become candidates for election as members of a House of the Parliament of the Commonwealth or of a State?
  2. Is he able to state which political party endorsed each of them?
  3. What position did each of them hold at the time of (a) endorsement and (b) retirement?

The honorable member for Dawson knows that the Government is hiding something. lt is because the Government is hiding something that it has refused for seven months to give information to the people of this country which it knows will indict it for victimising a man who stood for election and was elected as a Labour representative in this Parliament. We can go back to 30th September 1965 and 1st December 1965 and find questions on the notice paper unanswered. 1 will give you a summary, Mr. Speaker, because I hope you will take up this matter with the Government. It is important to us all. There are three questions on the notice paper from 1964, from about 18 months ago. There are six from 1965 and 47 for the month of March 1966. I realise that a reasonable time must elapse before questions on the notice paper can be answered, but the Government has allowed these questions to remain unanswered for too long for us to escape the suspicion - I hesitate to say this - that it is running away from its responsibilities and refusing to answer questions when the answers would place it in a bad light.

What is the good of getting an answer to a question that was asked 1 8 months ago? Why, there could even have been a change of government in the meantime, and a totally different answer provided. There is an obligation on the Minister for National Development (Mr. Fairbairn), who is at the table, to see about having the replies to these questions expedited. If the Government will not reply to them, at least it should let us know quite honestly whether they will ever be answered. Let us know how long it will be before we may expect answers even to those questions placed on the notice paper only in March of this year. It is most unsatisfactory not to receive answers to questions on notice until the Parliament has gone into recess, but it is far worse to find your questions still on the notice paper and unanswered after 18 months.

This is scandalous treatment amounting to contempt on the part of Ministers for members of the Opposition. I do not think any questions by Government supporters remain unanswered for any great length of time because few Government supporters can ask reasonable questions. Or perhaps they do not expect answers to their questions. The Leader of the House (Mr. Fairbairn) has a responsibility to see that questions are answered. He should wake up the dilatory aging members of the Ministry and tell them to do something about this matter, which is important to the people of Australia. Similarly I hope that you, Mr. Speaker, will interest yourself in this matter with a view to getting some justice for honorable members on this side of the chamber. I repeat that the Government shows complete contempt for the Parliament. It endeavours to hide its policies behind bitter attacks on knowledgeable men such as the honorable member for Scullin. I express the Opposition’s disapproval of the attitude of Ministers towards questions and of their treatment of men who put forward tolerant views on matters of great importance to Australian industry.

Question resolved in the affirmative.

House adjourned at 11.21 p.m.

page 1356


The following answers to questions upon notice were circulated -

Excise Duty on Beer. (Question No. 1546.)

Mr Hayden:

n asked the Minister representing the Minister for Customs and Excise, upon notice -

What amount of excise duty was received on the sale of (a) bottled beer and (b) draught beer in each of the States during (i) the first half and (ii) the second half of each of the years 1964 and 1965?

Mr Howson:

– The Minister for Customs and Excise has furnished the following reply to the honorable member’s question -

  1. Amounts of excise duty collected on beer, on a State by State basis, are not available for publication, except in the case of New South Wales. Furthermore, as the same rate of excise duty applies to beer, whether in draught or bottled form, no separate statistics are collected of amounts of excise duty paid on draught as distinct from bottled beer. However, from confidential information available to the Department of Customs and Excise in relation to individual breweries, an approximate percentage has been determined of the amounts of excise duty collected, on a Commonwealth basis, on (a) draught beer, and (b) bottled beer.
  2. Details of the gross amounts of excise duty paid on beer and approximate percentages of excise duty paid on draught and bottled beer, for the periods nominated in the question, are set out in the following table -

Australian Capital Territory: Child Care Centres. (Question No. 15770

Mr Kevin Cairns:

s asked the Minister for the Interior, upon notice -

  1. How many kindergartens, creches, and child care centres exist in the Australian Capital Territory?
  2. Of these, how many were built by the Department of the Interior?
  3. Are they maintained by the Department of the Interior?
  4. What were the total costs, showing separately, capital and running costs of these institutions, in each of the years 1962, 1963, 1964 and 1965?
  5. What are the estimated costs in each of these respects during 1966?
  6. What was the daily average number of children attended to by the kindergartens, creches and child-care centres, respectively, during the years 1964 and 1965?
Mr Anthony:

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

    1. The buildings for three centres were constructed or provided under the sponsorship of the Navy, Royal Australian Air Force and Army. A fourth centre is operated in a converted building at Wreck Bay. There are two registered kindergartens operated privately.
  1. The Department of the Interior is responsible for the maintenance on 27 centres including the Centre at Wreck Bay. It is responsible for running costs on 30 centres.

Australian Capital Territory: Schools. (Question No. 1578.)

Mr Kevin Cairns:

s asked the Minister for the Interior, upon notice -

  1. What was the total expenditure on high schools and primary schools in the Australian Capital Territory in each of the years 1963, 1964 and 1965?
  2. What were the capital and running costs in each instance?
  3. How many children attended Government primary and secondary schools in the Territory in each of the years 1962, 1963, 1964 and 1965?
  4. What was the average total cost of educating each child in primary and secondary schools in the Territory for which the Department of the Interior has responsibility?
Mr Anthony:

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

Trade with Vietnam. (Question No. 1630.)

Mr Beaton:

n asked the Minister for External Affairs, upon notice -

  1. Is Australia now trading with North Vietnam?
  2. If not, when did trade with that country cease?
  3. Were Australian troops stationed in South Vietnam when such trade was carried on?
  4. What was the (a) volume and (b) value of the goods traded with North Vietnam in each of the last five years of trading?
Mr Hasluck:

– The following answers are supplied to the honorable member’s questions:

  1. No; subject to (2) below.
  2. Since August 1965 there have been no exports to North Vietnam but there have imports of books, newspapers, and periodicals to the value of $52.
  3. Yes. The 3rd R.A.R. was stationed in Vietnam in June 1965.
  4. Imports from North Vietnam were:

Vietnam. (Question No. 1668.)

Mr Hayden:

n asked the Minister for External Affairs, upon notice -

  1. Which of the signatories to S.E.A.T.O. have not committed troops to the conflict in Vietnam?
  2. Is the failure of these nations to commit troops anindic ation that they do not accept that there is aggression in Vietnam on the part of either the National Liberation Front or North Vietnam?
Mr Hasluck:

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

  1. The United States, Australia and New Zealand have sent combat units to Vietnam. Britain, France, Pakistan, the Philippines and Thailand have not.
  2. It is for the Governments concerned, whose obligations under the Treaty are individual as well as collective, to state their position on this matter. However, at its 10th meeting (London, 3rd-5th May 1965) the S.E.A.T.O. Council issued a communique which included the following passage: “ Member Governments recognised that the state of affairs in Vietnam . . . constitutes a flagrant challenge to the essentia] purpose for which they had associated under the Treaty: to resist aggression.” France, which sent an observer only to the meeting, did not consider itself committed to the communique.

Language Instruction for Newspaper Correspondents. (Question No. 1670.)

Mr Hayden:

n asked the Minister for Air, upon notice -

With the purpose of assisting Australian newspaper correspondents who are to serve their employers in Asia to develop proficiency in the language of the country in which they are to serve, will he consider making available to these correspondents the facilities of the Royal Australian Air Force College of Languages at Point Cook?

Mr Howson:

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

Because of our present commitments in South East Asia the armed services have a need for proficiency in the languages of that area and are using the facilities of the R.A.A.F. School of Languages at Point Cook to the fullest extent. I regret, therefore, that no assistance can be given to those people in the categories mentioned by the honorable member.

New Zealand National Servicemen. (Question No. 1701.)

Mr Webb:

b asked the Minister for Defence, upon notice -

  1. Can he say whether New Zealand national servicemen are conscripted for overseas service in peace-time?
  2. Are any New Zealand national servicemen conscripted for the undeclared war in Vietnam?
Mr Fairhall:

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

  1. National servicemen in New Zealand are called up for limited full time training followed by part time training and reserve service. They may be sent overseas in peace-time if a state of emergency is declared.
  2. No New Zealand national servicemen have been sent to Vietnam.

Cite as: Australia, House of Representatives, Debates, 28 April 1966, viewed 22 October 2017, <>.