House of Representatives
17 April 1975

29th Parliament · 1st Session

Mr SPEAKER (Hon. G. G. D. Scholes) took the chair at 10 a.m., and read prayers.

page 1751


The Clerk:

– Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers:

Metric System

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth-

That the plan to obliterate the traditional weights and measures of this country is causing and will cause widespread inconvenience, confusion, expense and distress.

That there is no certainty that any significant benefits or indeed any benefits at all will follow the use of the new weights and measures.

That the traditional weights and measures are eminently satisfactory.

Your petitioners therefore pray:

That the Metric Conversion Act be repealed, and that the Government take urgent steps to cause the traditional and familiar units to be restored to those areas where the greatest inconvenience and distress are occurring, that is to say, in meteorology, in road distances, in sport, in the building and allied trade, in the printing trade, and in retail trade.

And your petitioners as in duty bound will ever pray. by Mr Bourchier, Mr Donald Cameron, Mrs Child, Mr Cope, Mr Erwin, Mr Fisher, Dr Forbes, Mr Fulton, Mr Garland, Mr Garrick, Mr Giles, Mr Hodges, Mr Jacobi, Mr Jarman, Dr Jenkins, Mr Killen, Mr Keogh and Mr McKenzie.

Petitions received.

Family Law Bill

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

That marriage is an exclusive lifelong partnership between one woman and one man, which should not be dissolved at the will of one party after 12 months notice nor without a reasonable attempt at reconciliation and

That a husband should normally be responsible for maintaining his wife and children within marriage.

Your petitioners therefore humbly pray that the Family Law Bill 1 974 be amended

  1. 1 ) To require a reasonable attempt at reconciliation with the aid of counselling at least twelve months prior to the application for a divorce;
  2. To specify three objective tests for irretrievable breakdown, namely

    1. intolerable behaviour,
    2. desertion for at least 2 years,
    3. separation for at least 3 years;

And your petitioners as in duty bound will ever pray. by Mr Les Johnson.

Petition received.

Family Law Bill

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned Citizens of the Commonwealth of Australia by this our humble Petition respectfully showeth:

It is granted that the present law respecting divorce is deficient in some of its provisions, and needs reforming.

Your petitioners consider preservation of the family essential to the healthy function of society, and that every effort should be made to preserve traditional attitudes to marriage and child-bearing.

Certain aspects of the Family Law Bill 1974 conflict with these concepts, and endanger the security, welfare, education and development of children.

We request that the Bill be not enacted in its present form, and that consideration be given to our concerns in formulating amendments thereto.

And your petitioners as in duty bound will ever pray. by Mr Cope.

Petition received.

Family Law Bill

To the Honourable the Speaker and Members of the House of Representatives assembled. The humble Petition of the undersigned, all being of or above the age of 18 years as follows:

  1. Your Petitioners oppose and seek the deletion of those provisions of the Family Law Bill 1974 which supplant the existing grounds by the introduction of the sole ground of irretrievable break-down, which remove any consideration of fault, and which will weaken the family unit while causing more widespread injustice because:

    1. a) it imposes on society a radical alteration of divorce law far beyond identifiable requirements or desires;
    2. it lowers the status of marriage by permitting people to drift’ into divorce, reduces parental importance and leads to increasing institutionalisation of children with consequential delinquency;
    3. it will not reduce the ‘in-fighting’ in a divorce suit which mainly occurs over matters of property and custody;
    4. it will not encourage maturity in acceptance of marital and parental obligations and responsibilities.
  2. Your Petitioners commend the divorce legislation introduced in Great Britain in 1973, which acknowledges the importance of the family unit, mirrors community requirements, secures justice for innocent people and establishes a realistice definition of irretrievable breakdown and call for similar legislation to be provided in Australia.

Your Petitioners, therefore, humbly pray that the House of Representatives in Parliament assembled will make provision accordingly. by Mr Drury.

Petition received.

Family Law Bill

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned Citizens of the Commonwealth of Australia by this our humble Petition respectfully showeth:

  1. That the present matrimonial laws are archaic, unrealistic and cruel and the cause of so much distress, bitterness and injustice as to make their continued operation intolerable to the vast majority of fair minded citizens of Australia and that the Family Law Bill at present before Parliament should be passed without delay.
  2. That the ground of Irretrievable Breakdown of Marriage determined by a maximum of twelve months’ separation, embodied in the Family Law Bill already passed in the Senate, be the sole ground for divorce.
  3. That there is widespread dissatisfaction with the enormous discretionary powers given Judges in the present legislation and that the non fault maintenance concept (according to need) based on specific criteria, as enunciated in Clause 54 (2) of the Family Law Bill 1974 No. 2, should be tried and we humbly pray Members of the House will restore this concept fully by deleting Clause 75 (n) from the new Bill as read a third time’.

And your petitioners as in duty bound will ever pray. by Mr McKenzie.

Petition received.

Family Law Bill

To the Honourable the Speaker and Members of the House of Representatives assembled. The humble petition of the undersigned citizens of the Commonwealth of Australia respectfully showeth:

  1. That the ‘Family Law Bill 1974’ fails to give the family the protection presumed to be guaranteed it under Section 43, for rather than preserving the lifelong union of married couples to the exclusion of all others, the Bill deals mainly with the legalizing of its destruction through easy and unjust divorce, together with the legalizing of the evasion of responsibility on the part of parents. (Sections 43, 48, 49, 50)
  2. That the Bill counts the period of ‘irretrievable breakdown’ as from the first declaration of ‘separation’, even in cases where a period of cohabitation has interrupted the legal ‘separation’, evidencing a change of heart and an attempt at reconciliation by both partners. (Section 48, 49, 50)
  3. That in the dissolution process, the Bill refuses to recognise any guilt, and since the Bill gives to parents ‘joint custody’ of children, the question of actual care and control of children seems to be vaguely left to welfare officers. (Sections 61-65)
  4. That children of 14 years and over are allowed to choose their guardians, who need not be either parent, in effect contravening the present law that prevents children under 16 years freeing themselves from parental control; and furthermore the Bill specifies that no order regarding such 1 4 year old children may be made that is contrary to the wishes of the child. (Section 64)
  5. That after the dissolution of the marriage, the wife may be forced to work to support herself and her children, and in some cases her ex-husband, as well as being liable for legal costs. (Sections 72-76)
  6. That under this Bill the loose term ‘irretrievable breakdown’ could be used as an excuse for divorce of convenience or for financial gain in various ways, including increased pensions, thus increasing the burden on taxpayers.

Your petitioners therefore humbly pray that the House of Representatives in Parliament assembled will do everything possible to promote and preserve the permanency of the married state, and not admit into the law of this land any provision for such easy divorce that threatens the stability of family life- for although the present divorce system has weaknesses, these will not be righted by an even weaker and more unjust ‘Family Law Bill’.

And your petitioners as in duty bound will ever pray. by Mr Bonnett.

Petition received.

Family Law Bill

To the honourable the Speaker and members of the House of Representatives in the Parliament assembled. The humble petition of the undersigned citizens of the Commonwealth of Australia respectfully showeth:

That the Family Law Bill 1974 would be an unjust law if passed since the innocent party could be divorced against his or her will after a year’s separation.

That the Bill does not only facilitate divorces but changes the nature of marriage and the husband-wife relationship. Legislation ought to reflect public opinion, not attempt to condition it. Gallup polls indicate 75% of Australians are opposed to the concepts of the Family Law Bill. Therefore Parliament has no mandate from the people to ask such a far reaching change in the nature of our society.

That children need a stable emotional and psychological environment in which to grow up. This stability is upset by divorce. A high proportion of criminals come from broken homes. Consequently any law which makes divorce easier is harmful to society.

Your petitioners therefor humbly pray that the Parliament so vote as to defeat the Family Law Bill.

And your petitioners as in duty bound will ever pray. by Mr Jarman.

Petition received.

Hansard: Subscription Rate

To the honourable the Speaker, and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

That the increased price of the Hansard subscription will place it beyond the financial reach of most people;

That it is basic in a Parliamentary democracy that electors have easy access to records of the debates in their Parliament;

That making Hansard available only to an elite who can afford it is at odds with the concept of open government.

Your petitioners therefore humbly pray that the Government will reduce the cost of the Hansard subscription so that it is still available at a moderate price to any interested citizen.

And your petitioners as in duty bound will ever pray. by Mr Drury.

Petition received.


To the honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

  1. 1 ) That the use of Uranium as an alternative source of energy is currently unacceptable as it presents problems including radioactive waste, military implications and thermal pollution.

    1. b) That there can, at present, be no assurances that radioactive materials exported for peaceful purposes will not be used in the production of nuclear weapons.
    2. That there is not, as yet, any known safe method of disposal of radioactive wastes nor ever likely to be.
    3. That the export of Uranium from Australia is internationally irresponsible and is not, in the long term, of benefit to Australia.
    4. That the export of Uranium from Australia only discourages importing countries from investing into research on viable alternatives.
    5. That only the overdeveloped industrial nations will benefit from Australian Uranium and the gap between these countries and the energy-starved Third World will increase yet further.

Your petitioners therefore humbly pray that the Australian Government will immediately cease the mining and exporting of Uranium until perfectly safe disposal methods for the radioactive wastes have been guaranteed; will greatly increase expenditure on research into safe clean and inexhaustible sources of energy; and will aid underdeveloped countries in their plea for a fair share of the world ‘s energy resources, while at the same time honouring its obligations to the future of humanity.

And your petitioners as in duty bound will ever pray. by Mr Lucock.

Petition received.


To the Honourable, the Speaker, and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

  1. That whales are a significant element in the world’s wildlife heritage.
  2. That whales are highly intelligent, highly evolved creatures.
  3. That there is growing international concern at the continued killing of whales for commercial gain.
  4. That synthetic products are able to fully replace all whale products.
  5. That Australia continues to operate a whaling station and to import whale produce.
  6. That Australia supported a proposal to enforce a ten year moratorium on all commercial whaling at the 25th meeting of the International Whaling Commission held in London, June 25-29, 1973.

Your petitioners therefore humbly pray that the members in Parliament assembled will move to immediately revoke all whaling licences issued by the Australian Government and to reimpose a total ban on the importation of all whale produce.

And your petitioners as in duty bound will ever pray. by Mr McKenzie.

Petition received.


To the Honourable the Speaker and Members of the House of Representatives assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

That whereas the Paris Agreement on Vietnam, of 26 January 1973 remains only partially implemented,

And whereas, consequently, the Provisional Revolutionary Government of South Vietnam remains unrecognised,

And whereas, consequently, untold thousands of political prisoners languish in South Vietnam gaols,

And whereas 18 Senators and 21 Members of our National Parliament already have indicated their support for recognition of the Provisional Revolutionary Government of South Vietnam,

Therefore we propose that the Australian Government immediately:

  1. 1 ) calls upon the signatory governments to take urgent measures to restore respect for the Paris Peace Agreement,
  2. recognises the Provisional Revolutionary Government of South Vietnam on a basis of equality with the Saigon administration,
  3. demands the release of all political prisoners and the restoration of democratic rights in South Vietnam.

And your petitioners as in duty bound will ever pray. byMrWallis.

Petition received.

page 1753



page 1753




– My question is addressed to the Treasurer. I refer to the quarterly estimates of national product recently released which show for the quarter a growth in total Australian production, for non-farm of 1.6 per cent, which would be of the order of 6.4 per cent on an annual basis, or of a growth in total national product of 2.8 per cent, which would be of the order of 1 1.2 per cent on an annual basis. I ask the Treasurer, how is this so when the figures also show that real spending on private consumption fell 0.9 per cent- that may be changing a little at the moment- real expenditure on fixed plant and equipment, the key component for economic growth, fell 12.1 per cent, and total investment 7.7 per cent, and the only component to show an increase is public capital expenditure of 7.8 per cent?


-Order! The honourable member is giving a considerable amount of information. I suggest that he ask his question.


– Would the Treasurer agree that the apparent strong growth shown is phoney and that the economy was, in fact, receding and not growing? I hand the Treasurer the document to assist him with the exam -

Dr J F Cairns:

– The honourable member has had considerable difficulty in asking his question. I will see if I can answer it with less difficulty. The figures he has selected from the large number that are available indicate that there is a low rate of growth. It will be recalled that the other day I pointed out that there was a low rate of growth. One of the purposes of the Government in these circumstances should be to avoid policies that further restrict growth and in fact do what -is possible to encourage growth. I pointed that out the other day and explained how we would do it. It is true that the general level of demand is starting to rise, and I think it will continue to rise. This will encourage investment decisions and growth.

As I pointed out the other day, however, one of the main reasons for difficulty in investment decisions is the high level of costs that has been experienced in Australia. It is clear that a considerable proportion of that high cost is due to the high rate of increases in wages and salaries that have occurred in the last 12 months. I think this has to be understood in the community- by workers and the leaders of unions. If we are to deal effectively with inflation in Australia with the increase in the cost of living, I think we have to realise that it is the wage situation that represents the most significant element in it. The community and the Government between them must be able to retain reasonable rates of wage increase. By that I mean a wage rate increase which will ensure that the living standards of the workers who receive those wages do not fall. By reasonable rates of wage increase I mean that relativities that are out of line have to be put into proper proportion. This is all within the limit of what I call a reasonable wage increase.

I think everybody must realise that the most significant element in a policy to control inflation is the establishment of a reasonable wage policy. In the absence of that, any attempt to restrict the economy by restricting money supply or by unduly restricting the Government deficit can only be counter-productive. I pointed out the other day that it will be the responsibility of the Government to ensure that the deficit and government finance are properly used to encourage investment and production in all areas where there are resources available for production, where as a result of Government action those resources can be productively used. I said that in the coming Budget not one cent will be included that is not fully justified. It will be the intention of the Government throughout the work leading up to the preparation of the Budget to ensure that the deficit is kept at the lowest possible level for the health of the economy.

page 1754




– I ask the Minister for Defence: Is it a fact that he said this week that he had never made a statement that there would be no threat to Australia for 10 to 15 years? I ask him whether it is a fact that in his own exact words in his own article in the Melbourne ‘Herald’ of 25 September 1 973 he said:

No one is threatening our security for the next 10 to 15 years.

Why is the Minister now misleading the Australian people about his own position?

Minister for Defence · BASS, TASMANIA · ALP

– I have made a number of statements in this Parliament concerning the strategic basis document, and I think I should make those statements available to the honourable member. He will find in those statements exactly what has been said in relation to the no threat period. He will be able to read the recommendation made by the Defence Committee. The honourable member is well aware of those people who represent the Department of Defence on the Defence Committee. The statements have been clearly defined by myself in this Parliament. I cannot recall the statement referred to by the honourable member which was said to have been published in the Melbourne ‘Herald’. What I have said in relation to the no threat period is that all the areas that have been examined by the Defence Committee show no likelihood of a threat to the Australian mainland in that period.

page 1754




-I address my question to the Minister for Social Security. Has the Minister seen a card being distributed to households in Victoria by Hospital Benefits Association advising people to maintain their contributions after the introduction of Medibank on 1 July and informing people of its advisory service? Is the Minister intending to leave the job of informing the public about the effects of Medibank to those with vested interests in misleading the public, or will he give consideration to setting up an advisory service within his own Department?


– Going on the past record of Hospital Benefits Association, I would not think that it would be a very reliable source to advise the public on how Medibank operates. In fact, I strongly advise the public not to take any notice of any advice they receive from that particular organisation because its record is quite against it being taken as a reliable source of information. I would also advise the public that in their own interests it would be pointless to continue medical insurance after 1 July because their medical needs will be covered by the medical plan of Medibank. They ought, however, to continue private hospital insurance with private insurance organisations if they wish to use non-public ward forms of hospital treatment in agreement States. In non-agreement States, even if they wish to use public ward treatment, they should take out private insurance for that category of treatment until the agreement is signed by those States.

Finally, the Health Insurance Commission has State offices. It will be opening suburban offices in all capital cities. It will also be opening a number of provincial offices. The Commission is employing community liaison officers whose job it is to advise the public on any aspect of Medibank about which they have a query. It is simply a matter of contacting a Medibank office and seeking out the liaison officer and having inquiries answered responsibly and properly.

page 1755




– I address my question to the Minister for Health. Will the Minister confirm or deny that officers of the Health Insurance Commission are attempting to force on the Canberra Hospital Board arrangements for Australian Capital Territory hospitals under Medibank after 1 July that will discriminate against patients who wish to retain their own doctor, and which is contrary to the Minister’s public assurance that Medibank will not interfere with this basic right? In particular, is it a fact that patients in Australian Capital Territory hospitals will be permitted a choice of doctor only if they pay for a single bed private room? Is it also a fact that an additional surcharge of $20 a day will be levied for such patients who retain their own doctor? If this is so, will the same penalties and restrictions be imposed in hospitals in the States if they agree to participate in the Government’s scheme?


– The allegation that has been made about the Australian Capital Territory is false not only in relation to the Australian Capital Territory but also throughout Australia. Under Medibank or any other arrangements no one in the Australian Capital Territory or elsewhere will be forced to have other than his own doctor. The only extra charge that will be incurred by people who go into hospital and wish to have their own private doctor is the charge for the hospital bed and this will be made on the basis of an intermediate or private bed. If they go in as hospital service patients there will be no charge for the bed. That principle will apply throughout Australia. There will be no discrimination or distinction in the Australian Capital Territory.

page 1755




– My question, which is directed to the Prime Minister, is supplementary to a question asked of him yesterday by the Leader of the Australian Country Party. Is the Prime Minister aware of any development which might impede any question of the pecuniary interests of a member of Parliament being properly determined by the High Court?


– I am unaware of any reason why the question of any parliamentarian ‘s eligibility to remain a member of the Parliament or to be chosen as a member of the Parliament should not be determined by the High Court. I am obviously aware of opinions being expressed around this building and reported in the newspapers. In view of what seems to be quite a campaign of intimidation against members of Parliament facing up to this question perhaps I should say that the suggestion that, for instance, there are barristers in the Parliament who might have disqualified themselves by accepting briefs from the Australian Government or from any Australian government instrumentalities is, in my knowledge, unlikely to have any foundation at all. I notice the Leader of the Australian Country Party was kind enough to put in his question to me yesterday that my position might be in jeopardy. In my reply I indicated that the only way in which I thought my position might have been in jeopardy was that before I became a Minister I had occupied a government flat for which I paid the normal assessed rental.

Mr Hunt:

– At one-third rental.


– Of course it used to be possible for Ministers to buy government houses in Canberra, but I do not wish to pursue that matter. After I became a member of the Parliament I never accepted a brief from the Commonwealth. I know of many cases where barristers who are members of the Parliament, in both Houses and on both sides, have declined to accept briefs from the Commonwealth for greater precaution. I do not remember any case where a parliamentarian who was a barrister has accepted a brief from the Commonwealth during the years 1 have been a member of the Parliament. Similar suggestions have been made about honourable members who are doctors. The point in that suggestion is that there are more doctors in the Australian Labor Party than there are in the other parties in the Parliament. It has been suggested that they are in jeopardy because from time to time they have attended pensioners under the pensioner medical scheme or written prescriptions under the national health scheme and thereby have rendered themselves ineligible. If this is the possible legal position it should be determined. I do not believe any of us have any reason to fear an investigation in this matter. There are professional and business people in the Parliament. The Parliament is better for having them. I think it would be farcical to suggest that any of them who, in the course of their profession, have received payments directly or indirectly from the Commonwealth should have placed their positions in jeopardy. But what is in question is the express provision of the Constitution concerning members of Parliament who are shareholders in companies which have dealings with the Federal Government. I do not believe that the public would hesitate to amend the Constitution if it precluded professional or business people carrying on their professions or skills while remaining members of the Parliament. I do not believe that the public would amend the Constitution to permit shareholders in small companies- that is, companies where there is a limited number of shareholders; the Constitution specifies 25 shareholders- having dealings with the Government. There are good reasons why shareholders in companies of no more than 25 shareholders should not have dealings with the Government or its instrumentalities. That is quite an important principle. It has never been called into question up till now. I do not believe that any proposal to alter the Constitution to remove it or to relax it would have any hope of success. If the facts or the consequences in the present case are obscure I do not believe that members of Parliament should take it on themselves to determine it. What we determined would obviously be suspect as having political motivations for or against the person concerned.

This matter was not raised by parliamentarians. It was raised by a special writer for one of our largest newspapers. That writer gave evidence- I suppose it was sworn evidence- to a Joint Parliamentary Committee. In those circumstances the matter arose in a way which does not involve any witchhunt -


-Order! I would ask the Prime Minister not to canvass a matter which is before the Senate. I think I did yesterday. It is out of order for this chamber to canvass matters which are subject to debate in the Senate.


– I believe that this matter should be determined by the High Court of Australia if it arises in this House. I do not believe that the leaders of the Country Party in this House should deter members of this House or parties of which members of this House are members from dealing with this matter in the proper way. The only impediment to having a rational, proper solution of this matter by the proper body contemplated by the Constitution, designated by the Parliament itself, is the lack of leadership and the silence on this matter in the Liberal Party. I notice that the Leader and the Deputy Leader of the Liberal Party are as silent on this matter as the Leader and Deputy Leader of the Country Party are vociferous and active.

page 1756




-Did the Prime Minister say in this House yesterday that the Government would reduce its deficit when unemployment reached reasonable levels? Will he now define for this House what he regards as a reasonable level of unemployment? When that level is achieved, how will the Government reduce the national deficit and get Australia out of the red when he is already on record as saying that the Government will not increase taxes or reduce its massive spending programs.


– I replied to a question asked by the honourable gentleman yesterday. He used the term ‘reasonable level of unemployment’ and I gave him a brief reply. Now he is dissatisfied with the reply. I thought that I was helping him by giving him a quick, brief reply. He used the term ‘reasonable levels of unemployment’; I did not use it. I notice that it is attributed to me in today’s newspapers. If I am to be regarded as adopting or propounding every phrase or sentence or paragraph in a question put to me, I will have to ask that matters like this be put on notice, but I do not want to make question time unduly prolix. The honourable gentleman yesterday was dissatisfied with the fact that I answered 3 questions each in one word. Now let him define it. All I can say is that I suspect- in fact I would be pretty confident- that what I would regard as a reasonable level of unemployment would be considerably lower than what he would regard as a reasonable level of unemployment.

page 1756




-Has the Attorney-General learned of a statement made yesterday by the Victorian Attorney-General, Mr Wilcox, in which he suggested that the Australian Government has failed to honour its obligations to provide $307,000 to the Victorian State Government for the Legal Aid Service. Can the Attorney-General inform the House of the circumstances under which that assistance was promised and would be forthcoming?

Attorney-General · ALP

-My attention had not been drawn to the statement by the Victorian AttorneyGeneral but some matters can be said in reply to the honourable gentleman’s question. The condition of legal aid in Victoria is not good. It was revealed to be not good; in fact the Sackville Committee which inquired into the overall scene in Australia revealed it to be bad. We know that in recent times the Victorian Government sponsored system of legal aid has been running into very serious financial difficulty. The Australian Government offered assistance of an amount of about $307,000. It was actually one of the first letters I wrote to the Victorian Attorney, on 12 February 1975, Implicit in my letter was the condition that the Australian Government’s form of legal assistance in Victoria would continue to exist. I am referring to the Australian Legal Aid Office. The letter requested consultation and the use of the Australian Legal Aid Office regional offices wherever possible as agencies for the Victorian Government sponsored scheme. In other words, we were putting to the Victorian Government the reasonable proposition that we wanted to fill with the Australian Legal Aid Office the vacuum in legal aid that had been revealed to exist in Victoria, but at the same time to give what financial assistance we were able to give to the Victorian Government sponsored scheme.

While I was doing that in an attempt to be fair and reasonable the Victorian Attorney-General was writing to the Council of the Victorian Law Institute urging it to take a certain stand as far as the Australian Legal Aid Office was concerned. The letter that he wrote can be regarded as little else than an attempt to sabotage the Australian Legal Aid Office scheme as it operates in Victoria. In emotional language he wrote urging the Council to adopt a certain course, which it has now adopted. Of course it still rests with the Victorian Attorney-General as to whether or not he gives a fiat to the Victorian Law Institute to continue the proceedings on which it has voted. The whole point is this, that the Victorian Attorney’s reaction to our offer of assistance was to sabotage the scheme, to destroy it and break the conditions which were implicit in our offer of help. The Australian Government is ready to help. We want to help. We offer to help. I cannot say with too much vehemence and sincerity that, when the Victorian Government seems to be determined to destroy one form of legal aid in Victoria that has been very successful and that is meeting a very great need in Victoria, one is obviously in danger of being embarrassed. The offers of help to the Victorian Government are still open but we seek its consultation, co-operation and assistance.

page 1757




– My question is directed to the Minister for Urban and Regional Development. What profit per block was made by the South Australian Land Commission on its purchase and subsequent sale of blocks in a virtually fully developed subdivision at Happy Valley? Was the profit of the order of $1,000 per block on a purchase price of approximately $4,750 per block four to five months ago? Is it not a fact that similar allotments in the same area are selling for prices the same as or less than those being asked by the Land Commission? Finally, does the Minister agree that the price of land in Adelaide has always been substantially less than the price of similar land in Sydney and Melbourne and that prices of land in Adelaide cannot be properly compared with prices of land in Melbourne and Sydney?

Minister for Urban and Regional Development · REID, NEW SOUTH WALES · ALP

-It is a fact that the Land Commission acquired the land for approximately $4,750 a block and that the sale prices varied between $5,200 and $6,200, giving an average sale price of $5,800. That price of $5,800 was at least $1,000 less than the price of comparable land in other parts of Adelaide. It has to be taken into consideration that the Land Commission does have a debt burden. It has administrative costs and it has to run at a profit. Consequently, this is the first step that has been taken. The honourable member asks if land in Adelaide has always been cheaper than in other States. It is cheaper than in other States because the progressive Dunstan Government took action at least 2 years ago to stabilise land prices. During that period the cost of land has skyrocketed in all other capital cities. I have explained to the House and to the general public that because there has been a restraint by the private sector on the supply of urban land and because there is little urban land in the pipelines of development, particularly in Sydney and Melbourne, the Government expects a pressure on the cost of urban land within six to nine months. I have also said that the 3 areas of Australia where we will be able to stabilise the price of land are South Australia, Canberra and Albury-Wodonga, where our land programs are under way. When we examine the cost of land, the situation is that the cost of land in Adelaide is at least $11,000 less per block than the cost of comparable land being made available in metropolitan Sydney. It is at least $8,000 to $9,000 less than the cost of land being made available in metropolitan Melbourne.

Regarding urban land policy and the land commissions, the first program which was adopted was by the South Australian Government, when the Australian Government made $8m available in the first financial year 1973-74, which has allowed this program to get under way. This financial year the Government made available $24m to South Australia to supplement its Land Commission program. Consequently, because the other State governments have now found that the land commission program in South Australia is going to be a success, the New South Wales Liberal Government has entered into an agreement with an urban land council, which is similar to the land commissions, and the Australian Government has been able to make available $ 10m in the first year to assist to stabilise the price of land in Sydney. It has been able to make available a further $10m in the southwestern corridor- that is, the area between Liverpool and Campbelltown. I was informed by the State Minister for Urban Development and Town Planning in Western Australia, Mr Rushton, that he as the responsible Minister, with the Premier of Western Australia, have now agreed to enter into discussions about an urban land council with the Australian Government. I am having talks next week with the Premier of Victoria and also there are to be discussions with the Deputy Premier of Queensland. I predict that by 30 June every State will have entered into an agreement with the Australian Government for either land commissions or urban land councils to try to stabilise the price of urban land.

page 1758



Mr Keith Johnson:

-My question is addressed to the Minister for the Northern Territory. Can he advise the House why he is not attending a most important meeting in Darwin today of the Darwin Reconstruction Commission and, as Chairman of the Darwin Cyclone Tracy Relief Trust Fund, a meeting to determine further policies for the distribution throughout Australia of Darwin relief money?

Minister for Northern Development · DAWSON, QUEENSLAND · ALP

-The fact is, of course, that I was refused a pair by the Leader of the Opposition. After Cyclone Tracy an arrangement was made with Mr Snedden and the Opposition that in the event of a request for a pair by the Minister for the Northern Territory, who has a responsibility to this Parliament for the reconstruction of Darwin, so that he could go to Darwin to attend to serious ministerial responsibilities, that pair would be granted. On the first sitting day on which the present Leader of the Opposition- the honourable gentleman for Wannon- took over the leadership of the Liberal Party of Australia, which was last Tuesday week, I asked the Opposition’s Deputy Whip, the honourable member for Griffith, whether the same arrangements would apply. He said: ‘Unquestionably, yes’. He sympathised with the position concerning my ministerial responsibility in Darwin.

Today.the most important meeting of the Darwin Reconstruction Commission is to take place. It will be at this meeting that the tenders for housing contracts will be discussed, recommendations made and decisions taken. It was to be at this meeting that the Commission was to recommend to me the people of Darwin to be appointed to the Darwin Community Committee, and decisions were to be taken. It was at this meeting that I was to explain Government policy regarding temporary housing, the amount of money to be made available for the purchase of caravans and so on. It was today that I was also to attend, as Chairman, a meeting of the Cyclone Tracy Relief Trust Fund concerning the provision of more money to the evacuees and the other people of Darwin.

Mr Sullivan:

– Is it your birthday?


-That shows just how seriously the Australian Country Party takes the position of the people of Darwin. In the normal way I asked for a pair. At 5.45 o’clock last night I received a cryptic message that a pair had been refused on the direction of the Leader of the Opposition. I have learned that the reason- the pathetic reason- was that the honourable member for Kennedy was to move today a motion concerning northern development which has been on the notice paper since 9 July of last year. In 2Vi years the honourable member for Kennedy has not asked one question without notice of me concerning northern development. In 2V4 years he has not moved one urgency motion concerning northern development. The serious thing about it all is the attitude of the Leader of the Opposition, who has broken the convention that always has been followed in this House by Liberal and Labor governments that whenever Ministers have serious portfolio responsibilities and have to attend to matters outside this parliament a pairing automatically will be granted. But the Leader of the Opposition does not understand people. He has not even been to Darwin. He does not know the seriousness, the suffering and the terrible position that the children of Darwin are going through at the present time. Compare that with the attitude of Mr Snedden, who went to Darwin on Boxing Day. He gave the Acting Prime Minister and me certain assurances and, standing on a truck together with the GovernorGeneral, repeated those assurances on behalf of the Liberal Party. The attitude adopted by the Leader of the Opposition does not surprise me because he does not understand ordinary people. He has successfully stabbed two of his leaders in the back. His contemptuous, arrogant attitude -


-Order! I think that the Minister should contain himself.


– I will conclude simply by saying that I consider the attitude of the Leader of the Opposition to be contemptuous in the extreme. It will show the people of Darwin and the people of Australia what sort of a man he is.

page 1759



– I call the honourable member for Kennedy.


-Thank you, Mr Speaker. I will deal with this man- the Minister for Northern Development and Minister for the Northern Territory- later. My question, Mr Speaker, is directed to the Attorney-General.

Dr Patterson:

- Mr Speaker, I take a point of order. The honourable member for Kennedy, in another place, threatened a member of the Senate. He is now doing that to me. I ask -


-Order! The Minister will sit down and the honourable member for Kennedy will sit down. Firstly, this House has no knowledge of anything that takes place in the other House and the other House has not taken any action to inform us of anything that took place in that House. Therefore, it is not the prerogative of the Chair to have anything to say; it is the prerogative of the President of the Senate. The words used by the honourable member for Kennedy I could not interpret as being a threat. I think they are the normal words used in parliamentary practice and there is no point of order. I call the honourable member for Kennedy.


– Is the Attorney-General aware that, after prolonged investigations into the effects of marihuana, a report from the World Health Organisation of the United Nations now claims that there is conclusive evidence that the habitual smoking of marihuana can cause genetic imbalance resulting in a serious effect on a young woman’s- or any woman’s- reproductive organs and may similarly affect a young man; particularly is there the possibility of his becoming impotent? I do not refer to the AttorneyGeneral. In addition, is he aware that this report states that there is now -


-Order! The honourable gentleman is giving a considerable amount of information. I suggest he come to the question.


– I am asking him if he is aware of this.


-I realise that, but the honourable member is giving information.


– Is the Attorney-General aware that there is a possibility of cancer also resulting? In view of even the remotest possibility of this happening, will the Attorney-General now urgently allow the law to be completely enforced in the Australian Capital Territory and the Northern Territory so that those persons in possession of any quantity of any drugs will be prosecuted and young people will thereby be protected against their own weakness and their exploitation by criminal drug pushers? Will he step up law enforcement activities so that he may have arrested, and put away, the lowest form of animal life, the pushers? Will he take steps to have the law revised whereby the murderous activities of ‘Mr Big’, who sits in the shadows, the recipient of huge profits -


-Order! The honourable gentleman should come to his question. He is taking a long time to do so.


– Will the Attorney-General apply the same penalties to the wholesale distributor of drugs as applies to a convicted murderer?


-The honourable gentleman made so many points that I can only single some out for answer.

Mr Katter:

– You are a lawyer.


– I am not a doctor. The question of the harmful effects or otherwise of marihuana is a continuing debate. My understanding is that the case for its harmful effects is nowhere near as convincingly made out as it is for alcohol and certainly for nicotine. But the debate and the controversy continue. As far as trafficking in drugs is concerned, no one has a greater abhorrence of it than I do. The pusher, the trafficker and so forth, the people who fatten on some other person and make money in that way, are to be criticised and made the subject of criminal law. May I say this on the subject of the Australian Capital Territory, because there was some unfortunate exchange of criticisms between the honourable member for Hotham and myself in the media last week on the subject. My understanding, and it is based upon advice that has come to me from the Department, is that some considerable time ago a practice was arrived at in the Australian Capital Territory Police Force that led to no more arrests being made. There were exceptions to that, but that was the policy and that was the practice. The policy, if it can be called that, was in large measure a result of the fact that the courts in the Australian Capital Territory were not recording convictions. They were dismissing charges because of defects in the law. There are other reasons, of course, that perhaps one can impute to the policemen concerned.

I do not regard my function as being to move into an area like that and give policemen directions that they should go against their own good judgement. The matter of changing the law is a matter for my concern. There is a proposal, with which I am associated, together with the Minister for Health in the Government, which would give effect to certain international treaty obligations that the Government has, flowing from the International Convention on Narcotic Drugs and Psychotropic Substances. If that proposition comes to fruition the penalties that are obviously thought desirable by the honourable gentleman for trafficking in hard drugs will certainly be extremely severe. On the question of marihuana it would provide- it is only a proposal at this stage- for a penalty much lighter than the penalties that exist in the existing State legislation, because this proposal, if it comes to fruition will result in legislation from this Parliament that will have overriding Australia-wide effect. It will record the feeling in the community that marihuana is not to be legalised at this stage, but- I emphasise this aspect- there will also be a requirement on the Government flowing from its international obligations to let it be that way. In other words there will be no legal capacity or power to remove altogether, the penalty applying to marihuana although there are significant numbers of people in the community who believe that that should be done as well.

page 1760



Mr Les Johnson:

-I favour this scheme and in fact have advocated it for a long time. Primarily it involves making project loans available to builders rather than individual loans to individual home seekers. It seems to me that many advantages could accrue from such a rearrangement involving the utilisation of permanent building society funds. It would offer very great advantages over the one-off way of building houses which incurs very high costs. For example, there could be advantages resulting from the wholesale acquisition of land. There could be cost savings in the legal area and the architectural area. I think the scheme would also offer advantages in the sense that proper town planning principles, architectural approaches to housing development and the provision of desirable aesthetic factors in housing estates could be brought to bear. If building society funds were to be made available to project builders it would be important to make certain that funds made available at such concessional or advantageous rates would be passed on to the home purchaser in the long term. 1 am very pleased to see that this matter is now being considered by the building societies. For some time the proposal has been inhibited by the State authorities, which in fact administer permanent building societies, but I know that the attitudes which are now being expressed and which follow on my own advocacy of this scheme are likely to receive consideration from the State authorities. If that consideration is based on the merit of the scheme I think the scheme could well be advanced in the near future.

page 1760


Minister for Services and Property · Grayndler · ALP

– Pursuant to the provisions of section 23A of the Commonwealth Electoral Act 1918-1973, I present a copy of the report with maps showing the boundaries of each proposed division by the ‘distribution commissioners for Tasmania, together with copies of the suggestions, comments or objections lodged with the commissioners.

Pursuant to the provisions of section 23A of the Commonwealth Electoral Act 1918-1973, I present a copy of the report with maps showing the boundaries of each proposed division by the distribution commissioners for Queensland, together with copies of the suggestions, comments or objections lodged with the commissioners.

page 1760


Minister for Defence · Bass · ALP

-For the information of honourable members I present a statement on the appointment of a Development Council for the Australian Defence Force Academy.

page 1760


WannonLeader of the Opposition

- Mr Speaker, I seek leave to say something about my attitude to leave or to pairs being granted.


-Order! Is leave granted? There being no objection, leave is granted.


-My remarks apply to both the Government and the Opposition. When this House is sitting the basic purpose of members and Ministers is to be in the House unless there are unavoidable circumstances. Obviously there are occasions when the Prime Minister needs to be overseas and there are permanent arrangements with the Prime Minister. It has been put to me that those permanent arrangements should be extended to at least one other Minister. I rejected that because I thought it ought not to be extended to other Ministers.

Mr Whitlam:

– Not by the Prime Minister- one other Minister.


-No, I am not suggesting the Prime Minister did. I am not naming the Minister concerned unless he wishes to name himself. But I believe it ought not to be extended to other Ministers and that was made quite plain.

The basic proposition is that when this House is sitting members and Ministers ought to be here. The timing of the sittings of the House is in the hands of the Government, not in the hands of the Opposition. There can be unavoidable commitments which can involve other parliaments. When there are councils involving State Ministers it may not be possible to get a time in which no State parliament or the Federal Parliament is sitting. Therefore, under those circumstances, it is not necessarily in the hands of a Commonwealth Minister to fix a time that would suit every member of Parliament. But there are some other meetings whose timing I believe is within the control of the Minister concerned, especially when he is not involved with members of State parliaments around the Commonwealth. I would have believed that the meeting to which I am directing my remarks was one such meeting. When one looks at the membership of the commission concerned one can see that the members either live in Darwin or directly or indirectly are employees of the Commonwealth.

The Minister for Northern Development and Minister for the Northern Territory (Dr Patterson) should have known of the sitting times of this House and should have been able to fix the meeting of this particular commission for tomorrow or at a time when the Parliament was not sitting. He chose not to do that. Another matter, of course, that is relevant to this issue is the timing for which leave is applied. A note came into the

Whip’s office at 12.10 p.m. on 16 April- yesterday asking for leave to be given to the Minister so that he could attend a meeting presumably so important that the time for it was fixed a long while in advance. Presumably, therefore, proper application for leave could have been made in proper time and not very much at the last minute.

The Minister knows very well that the only applications for leave which will be paired come from Whip to Whip and, no matter what conversations he may or may not have in the corridor, until there is an application in writing to the Whip there is no application for leave. Within these guidelines the Opposition will co-operate with the Government. At the same time I think that some Ministers might already be aware that Ministers wishing to attend speaking engagements around the Commonwealth which are not necessary to the carrying out of their administrative functions will not be granted pairs in the way they might have been in the past.

Another point in relation to this matter is that a very important debate on northern development is to take place this morning and it is important for the Minister for Northern Development to be here. If I wanted to impute motives to him, as he to me, I would have suggested that he had fixed the date of this commission meeting to avoid a debate on northern development.

Minister for Northern Development and Minister for the Northern Territory · Dawson · ALP

- Mr Speaker -


-Order! Does the Minister claim to have been misrepresented?


– I seek the same indulgence as did the Leader of the Opposition.


-Is leave granted for the Minister to make a statement? There being no objection, leave is granted.


-Quite briefly, it is a fact that the Leader of the Opposition (Mr Malcolm Fraser) does not know the Darwin Reconstruction Act for which he voted. I have no jurisdiction over when meetings will be called. It is the Darwin Reconstruction Commission itself which calls the meetings. The Commission weeks ago called a meeting for yesterday. Regarding the imputation about running away from a debate on northern development, as I said before, the matter which is to be raised today has been on the notice paper for 9 months. The honourable member for Kennedy (Mr Katter) has not asked one question on northern development. Not one urgent matter of public importance concerning northern development has been raised in 2Vi years.

Mr MALCOLM FRASER (WannonLeader of the Opposition)-Mr Speaker, may I make one final point. I do not wish to be tedious about this matter.


-Order! Does the honourable member claim to have been misrepresented?


-No. I ask for leave to make one point in 30 seconds.


-Is leave granted? There being no objection, leave is granted.

Dr Patterson:

– I was not given leave.


-The Minister was given leave. He spoke by leave of the House.


-Whatever may be in the Darwin Reconstruction Act, when a commission is operating in relation to a Minister, as this Commission operates in relation to the Minister for Northern Development and Minister for the Northern Territory (Dr Patterson), it is a fact well known by every person in the Parliament and by most people in the country that the Commission will seek a timing for its meetings which suits the Minister.

Mr Donald Cameron:

- Mr Speaker, I claim to have been misrepresented.


-The honourable gentleman will sit down.

page 1762


Mr Donald Cameron:

-Mr Speaker, I desire to make a personal explanation.


-Does the honourable gentleman claim to have been misrepresented?

Mr Donald Cameron:

-I do.


– I will give him the indulgence, but I suggest that in future he might tell me beforehand.

Mr Donald Cameron:

-I can never predict your Ministry.


-The honourable gentleman may be asked to resume his seat if he makes remarks like that again.

Mr Donald Cameron:

-I will not make them like that, sir.


-The honourable member is speaking with my indulgence.

Mr Donald Cameron:

-The Minister for Northern Development and Minister for the Northern Territory said that when he approached me at the beginning of last week about leave to attend meetings in relation to the reconstruction of Darwin I said unquestionably yes, that he could go on any occasion. At that time I said possibly so, that he could go to these various meetings. But I also added that it would depend upon circumstances at the time and that each application would have to be in writing and judged on its merits. That is a lot different to unquestionably yes.

page 1762


Motion (by Mr Daly) agreed to:

That the House, at its rising, adjourn until Monday next at 2.15 p.m.

page 1762




-Before commencing my speech I shall refer to the remarks of the Minister for Northern Development and Minister for the Northern Territory (Dr Patterson) about my not asking questons. To ask questions of any Minister in this House is a pretty futile operaton. But on occasions I have sought personal discussions with the Minister. He has meted out the same sort of remoteness and treatment to me as he has to every responsible person in the Northern Territory. He has treated them with contempt and has firmly refused any sort of consultation. I shall deal with that in a moment. My leader, with a dignity which was commendable, answered the Minister’s vitriolic uncontrolled outburst. I move:

That this House believes the Government should completely review its plans for northern Australian development believing the Government’s present policies on northern development do not contribute to the prosperous growth of northern Australia.

All aspects of policy concerning northern development and the Northern Territory must relate in a special manner to people. While we are talking of people I comment that I have visited Darwin and the Northern Territory on 5 occasions. I have driven by car to almost every remote area on 2 occasions. The remark I hear everywhere is that the people have not even sighted the Minister. The conditions under which people live, people who have incentives which attract them to areas which are comparatively remote, are in many cases unattractive climatically. They have to pay higher costs for services and commodities. The Liberal Party and Australian Country Party recognising this have closely examined the whole spectrum of life in Northern Australia and have produced policies for people and for the development of the nation’s resources.

In contrast we have seen the present Government produce policies which have almost a complete disregard for the welfare of the people in northern Australia. We have witnessed the rundown and the almost complete stagnation of the 2 major industries- mining and beef cattle. Admittedly, the sugar industry is enjoying favourable conditions. But this has been due to the splendid work of a group of united industry leaders and to the present world demand. The most essential and perhaps the scarcest commodity in the north, particularly inland, is water. The Liberal and Country parties will continue their policy of examination and analysis of the surface water courses, of recording the potential of certain streams in areas of population or projected population and development, with the final object of harnessing such river streams as the great Burdekin. In addition, it will encourage and examine the possibilities of suitable and responsible incentives to encourage similar conservation and reticulation schemes by local authorities and, under special circumstances, new developments. It will study world developments in the matter of desalination. What has the present Government initiated in this regard? The Minister for Northern Development will have to admit that with the exception of one or two projects- admittedly they are important but certainly not major projects- there has been only a token attitude towards the development of our water resources. He will, of course, refer to the limited action being taken to study the Burdekin possibilities and the further development of the Bundaberg irrigation scheme. Of course, in both cases the Government is only continuing the work initiated by us when we were in government, and it is not doing very much good at that either.

One of the most tragic results of this Government’s lamentable record which relates in a special way to the whole northern frontier of this nation is its almost complete failure to develop any defence capability. I, as Army Minister, was immensely proud of the Army base at Townsville and the sound strategic value of its being in that area. Has there been any further defence contribution which would in any way at all contribute to the security of this country, to the protection of our northern frontiers? On the contrary, when we were in government we had planned an additional battalion which would have been based in Western Australia, in Townsville or in Rockhampton. That plan was scrapped. Our present organisation, if it is at full strength, is the absolute minimum required to meet any sort of emergency. We have 6 battalions. I could go on and talk of the Mirage squadrons going out of business and the non-Navy we now have. If the Government has not abandoned the defence and security of this country the least it should do would be to build up the Army to divisional strength. It should have at least thirty or forty hard hitting, highly mobile patrol boats constantly in action in northern waters. As one moves around the country and comes into contact with what is left of Army units, it is appalling to find that the morale of our Army is crumbling, and I would say that the morale of the other two branches of the Services is crumbling to the same degree.

One industry which this Government has watched deteriorate with obvious disinterest- almost contempt- is the fishing industry. Under the Liberal-Country Party Government we saw a great wave of prosperity which stimulated the fishing industry to the most exciting point of development it had ever known. At Karumba in the Gulf country one new processing plant after another was opened up. Great refrigerated road trains travelled south with hundreds of thousands of pounds of prawns. As well as there being a great home demand, a most significant export trade was established. Now what do we see in contrast? Where previously there were 5 processing plants at Karumba, there are now only two- Mostyns and Markwells. Hundreds of fishermen have left the area. Men who had purchased boats and looked like establishing themselves permanently in that remote area have been forced to leave. The economic policies, the anti-rural attitude of this Government, resulted in the workers of the industry, the fishermen, getting so little for their catch that they were operating at a loss. Let the House and the people of Australia note that fact. One of the major factors that contributed to this decline was the withdrawal of the fuel differential subsidy. Now we see that even in this short time the price of fuel has doubled in that remote area.

Let us now look at housing. Houses in northern Australia must be designed for conflicting conditions. They must provide comfort, strength and a minimum of maintenance in arid and high rainfall areas, such as in the tropical areas around Darwin and along the far north coast of Queensland. Strength in houses is needed because of the constant threat of cyclones from December to April. In the dry areas houses must be planned to counter the discomfort of searing heat and extreme dryness. Building materials must be chosen to withstand these conditions. In all areas suitable air conditioning should be made available at a minimum cost. That was done in my home town, and it can be done and will be done in other areas when we return to government. Because housing is so costly in remote areas of northern Australia, the Liberal and Country parties will research the latest developments in housing for similar areas throughout the world. We will examine particularly the work of such people as Mr Marquis Kyle of the Queensland University who has studied and become a world authority on adobe housing. People should not get the impression for a moment that adobe housing means mud huts. That phase of housing has long since passed. In Mexico there are adobe houses which are aesthetically beautiful and comfortable to live in. The object of this study will be to provide a home which can be build basically with local materials and so greatly reduce the costs which are enormously increased by high freight charges.

Solar hot water systems are now readily available and most effective. The Liberal and Country Parties will do all that is possible to have such systems installed as standard equipment in houses in suitable climatic areas. It would be interesting if the Minister for Housing (Mr Les Johnson) and the Minister for Northern Development and the Northern Territory would present to this House a record of the Government’s achievements in providing anything near the number of houses required for northern Australia, and particularly for the Northern Territory. It is true that the Government initiated a housing scheme for Tennant Creek 10 minutes before the election, thinking that it might hold that Labor stronghold. Everyone knows the story there. That particular member went with the rest of them. Let the Minister for Housing indicate any real effort made either by him or by the Minister for Northern Development, or by anyone else in the Government, to provide suitably constructed houses for tropical conditions, and particularly constructions designed to resist cyclonic winds. I am speaking of the period prior to the disaster which occurred on Christmas eve. I would like to know what real interest the Government took prior to that cyclone in providing suitable housing.

When I was in the United States recently I made it my business to look into such constructions. The Americans call them anti-hurricane constructions. Two interesting facts emerged. One can get out of it rather cheaply by putting a concrete room, an anti-cyclone room, in one’s house. I believe that in the United States that would cost about $600. Alternatively one could go into something far more spectacular. One could build a house which has horizontal steel beams and is strapped down by a concrete arch through which runs a steel rope. In other words the whole house is strapped down. But it is very costly to do that.

I shall now deal with roads. The Liberal and Country parties made an historic and immeasurable contribution to transport and communications in Australia when they introduced their beef roads policy. They pressed ahead with the construction of thousands of miles of road under that scheme. In addition we accepted and approved a recommendation in 1972 that a policy for the construction of national highways be examined and accepted. The acceptance by the ministry of that proposal was in all cases designed to establish top class roads to the north and to establish permanent arterial roads and major highways to the southern capitals. I want to make one point here: Our parties acknowledged the danger of such schemes absorbing available funds to such a degree that feeder and development roads, particularly in northern Australia, could well suffer, and cause the local government authorities to gasp for financial breath as regards their road building. Funds for such roads will be carefully set aside when we are returned to government so that that does not happen.

We have a current situation at Newcastle Waters in which the main arterial link is cut. It has been cut for some days and will remain cut for some weeks, I believe. It will be interesting to hear the Minister for Northern Development make some comment on that matter when he replies. Perhaps he can tell us what is being done to find some permanent solution to the problems associated with that particular section of the Stuart Highway. Special attention should be given- I suppose that it has been given to a degree- to completing the sealing of the Stuart Highway so that as soon as possible all-weather road communications can be made available between Darwin and Adelaide.

It is here that I particularly indict the Minister. He has made every conceivable excuse, and ever since he has been in Government he has sidestepped the issue of the completion of the section of road between Winton and Boulia. May I inform the House and the people of this country that that is the missing link in road communications from Darwin south as far as one wants to go. One of the biggest disappointments of the people of northern Australia is the failure of this Government to complete the beef roads program and particularly that section to which I have referred. If that section had been sealed during the great 1974 floods, urgently required supplies for Mount Isa and the Northern Territory- this huge area- would have been available much sooner. There has been no progress on the sealing of the long remaining extremely bad sections of the Landsborough Highway, another vital and critical link. Many other roads, which will not be anywhere near the proposed route of the national highways and which have been the subject of constant representations to the Minister for Northern Development- for example, the Charters Towers-Clermont road- are receiving no consideration. The Minister is a side-stepper of the highest order. He would make a tremendous back line footballer.

In regard to the beef cattle industry and any sort of representations made to him he side-steps the issue. He has never taken a stand as my Leader and Deputy Leader did in the bad days when we were fighting for a wool subsidy. He has never stood up to his Cabinet, because his heart is not with the people; his heart is with retaining his portfolio. As I once said, he has front seat compulsion. If he has put up a fight with his Cabinet, let him come out and declare this. Why do he and the Minister for Agriculture (Senator Wriedt) whom he represents in this House not both come out and explain what is actually happening with Cabinet in relation to their emasculated efforts?

Let me refer now to the Port of Darwin. I give it the name ‘Port’ for want of a better description for the deplorable and lamentable installation up there which is so vital and critical for the people of the Northern Territory. Promises have been made but nothing of any significance has been done in rebuilding, or building, the port. Even before the cyclone the facilities were deplorable. It is a world disgrace that the gateway to Australia should be provided with such inadequate port facilities. I speak with some authority on this matter because I was a member of the Townsville Harbour Board for 10 years. In circles where this matter was discussed I am afraid that the Port of Darwin was discussed in a very bad light.

I turn now briefly to education. The overall attitude of the Opposition Parties- it should be the overall attitude of the Government- is to establish standards of education in the Northern Territory comparable at each level with those similarly offering anywhere else in Australia. Taxation deductions must be given on the basis of compensating parents for the obvious financial disabilities suffered in regard to clothing, accommodation, travel and other matters involved with the education of their children. For instance, the education tax allowance of $400 should immediately be restored. There should be specialised training in mining, animal husbandry and farming techniques so that we can keep these young people interested in these things and keep them in the area. The resources policy of the Opposition sets out our Parties ‘ planning and attitudes not only to restore confidence in the mining industry but also to introduce new initiatives to meet world supply and market fluctuations, as many of Australia’s greatest mining operations are in northern Australia and the Northern Territory. Special consideration will be given under a Liberal-Country Party Government to the small miners- the gouger and the small operator- who collectively, with encouragement, could play a most significant role in the industry if provided with reasonable incentives and Government assistance. This Government has ignored these people and treated them with contempt. I can name many of them who have approached the Government for some assistance and have just been ignored.

The Australian Labor Party has crippled the once great mining industry. Nowhere is this more evident than in the Northern Territory. If I seem unreasonably unkind, honourable members can check out the facts in the Territory and in the north west of Queensland, seek information at all levels in any mining centre in Australia, and they will find a bitterness against the Minister for Minerals and Energy (Mr Connor), a man obviously possessed by a paranoiac class hatred. He must be indicted for having cost the nation many millions of dollars. Again and again he covers up his rampage of destruction by honey sweet statements about preventing the rape of our resources. This bitter old man making his last hurrah in politics is mutilating and violating every decent characteristic of freedom and free enterprise which this nation and its people have cherished.

Research over recent years has proved the tremendous capacity for the grazing and agricultural industry in northern Australia. Any hope for the future has been stifled by the recommendations of the Coombs report. I would like to mention many matters- I am sure that they will be mentioned by subsequent speakers- but time is running away from me. There were many recommendations made by Dr Coombs. I believe that more are yet to come. Some of them will perhaps be even more disastrous than those which have crippled the people on the land, thousands of small businessmen, thousands of small contractors and the thousands of workers dependent on those industries. This Governmentthe workers’ friend- has people in the back blocks of Australia queuing up for relief because the Government has crippled the industries on which these people depend.

Let me reiterate before I conclude my remarks that the Minister for Northern Development is unapproachable. He will not consult or confer with any responsible person in the Northern Territory. He treats them with contempt. It is high time he went around the area. Never mind talking about me; let him get into a motor car and rough it, as I have done around the Northern Territory since I became shadow Minister.

In conclusion let me say that the Opposition Parties acknowledge that northern Australia is a great treasure house of natural resources. We see a great stage set for planned population centres. We see magnificent scope for unique cultural activities and great natural attributes. We see our Aboriginal people consulting with us as equals. We realise that the keynote of all these activities is a close liaison- a liaison which does not exist with this Minister- with those who have spent a lifetime in these areas and who know the answers. We are determined that Government will be brought to the north and the Northern Territory, not taken away from it and centred here in Canberra as this Government is so cruelly and maliciously doing. We respect the dignity and right of every individual- in northern Australia and the Northern Territory to decide his own destiny and that of his own great land.

Mr DEPUTY SPEAKER (Mr Lucock)Order! The honourable member’s time has expired. Is the motion seconded?

Mr Calder:

– I second the motion and reserve my right to speak.

Minister for Northern Development and Minister for the Northern Territory · Dawson · ALP

– Rarely have I heard in this House such shallow, unsubstantiated and hypocritical statements as those made by the honourable member for Kennedy (Mr Katter). Firstly he delivered a vicious attack on the Minister for Minerals and Energy (Mr Connor) and then, in the course of his speech, he viciously questioned my credibility. The honourable member for Kennedy is the last person in this House who should speak about credibility. Let him listen to me. He was a member of the Australian Labor Party for a number of years and the President of a branch of the Australian Labor Party.

Mr Katter:

– You have to shop around before you find the right article.


-That is right. Then he was a member of the Queensland Labor Party, or the Democratic Labor Party, for a number of years. But he could not get anywhere in the Labor Party or in the DLP so what did he do? He joined the Australian Country Party. It is well known throughout the north that if he had lost the plebiscite for the Country Party he was going to join the Liberal Party. That is the sort of person who talks about credibility. The last person in this House who should talk about credibility is a person who rats on his own party. The honourable member has done it twice and he would have done it 3 times. So let us not hear any more nonsense from that honourable member about credibility.

Mr Giles:

- Mr Deputy Speaker, I take a point of order. Is it the correct procedure for one honourable member to refer to another as ratting on his party without any proof of that?


-I think that the honourable member for Angas will recall that that phrase has been used in this House on previous occasions.


-Let me deal also with some of the points he made. The honourable member for Kennedy said that he has roughed it many times in the north. Look at him! If he ran 5 yards he would fall over, gasping for breath. Roughed it in the Northern Territory?

Mr DEPUTY SPEAKER (Mr Lucock)Order! Might I suggest to the Minister for Northern Development that he should stick more closely to the subject matter of a motion moved by the honourable member for Kennedy.


– I am answering the allegations made by the honourable member for Kennedy. Let me answer a few more.


-Order! I might suggest to the Minister that a comment about the capacity of the honourable member for Kennedy to run is not actually answering the remarks made by the honourable member.


-The honourable member for Kennedy said he roughed it. I am questioning his ability to rough anything. On his point about dealing with me, any time he likes to I can assure him that I will agree to it. The honourable member for Kennedy spent most of his time criticising the Government for what it has not done. He should have spoken about what his Government did in 23 years. He criticised this Government for not building the Boulia-Winton road. The coalition was in government for 23 years. Why did it not build it? The honourable member said that not one cent has been spent by this Government on the Clermont-Charters Towers road. In 23 years his Government spent nothing. To show his ignorance of the situation, has he ever heard of Cape River? Has he heard of Mt Coolon or Mt Douglas? If he has, he will know that this Government is spending $3m on the Charters Towers-Clermont road. He does not even know it.

Mr Katter:

– Does that come into the central highlands?


-That comes into the central highlands.

Mr Katter:

– It does not, and you know it.


-The honourable member made the allegation that the Government is spending nothing on the Charters TowersClermont road. He does not even know on what part of the road are Cape River and Mt Coolon. He does not even know that. That shows how ignorant he is of the north. He spoke about the Burdekin River and what the Government should do. What did his Government do in 23 years? Let me quote the words of Sir Arthur Fadden in his policy speech at Boonah in 1949: ‘We shall build the Burdekin Dam. We will not let it lie in the pigeon holes for ever. ‘ In 23 years the Liberal-Country Party Government spent not one cent on the Burdekin. This Government, in conjunction with the State Government, has spent over $lm in investigations involving the Snowy Mountains Corporation and the State instrumentalities in research and investigations. It has outlaid a sum for the Clare Weir. It is doing something constructive and the LiberalCountry Party Government did nothing in 23 years, despite the unqualified promise by the then Leader of the Country Party, Sir Arthur Fadden, at Boonah in 1949. The honourable member for Kennedy spoke about the Darwin port- if it could be called a port. I share his concern about the problems of the Darwin port, but what did his Government do about the Darwin port in 23 years? That Government has to take the full blame for the problems in the Darwin port area. There are other port problems, there is no question about it, and I am first to admit it. But I am trying to do something about it.

I am trying to do something about the flooding of the Newcastle waters at Lake Woods north of Elliott. I have repeatedly contacted the honourable member for the Northern Territory (Mr Calder) to let him know about the cables and telexes that I have received on what is happening up there. At present there are still problems there, but the Carpentaria Highway is still open and the trucks can get through. Building materials are getting through. But the National Disaster Organisation is waiting in case the Carpentaria Highway closes. But the honourable member for Kennedy would not even know where the Carpentaria Highway is.

Mr Katter:

– Wouldn’t I? Would you like to take a drive, instead of taking a VIP aircraft? Would you like to take a drive?


-Order! I suggest that this not be a private argument between the Minister and the honourable member for Kennedy.


-The honourable member for Kennedy says that he has been to the Northern Territory five times and in that time he has driven to every remote area in the Northern Territory. Not even the honourable member for the Northern Territory, in the many years that he has been the member could have done that. It is impossible. Yet this genius here, who has been there five times, has driven to even the remotest areas of the Northern Territory- to places like Arnhem Land and Oenpelli, where there are not even any roads. But of course, he is a genius.

Mr Garrick:

– On his camel.


-On his camel; they have got wild camels up there. The honourable member for Kennedy talked about water conservation. I have already spoken about the Burdekin and what his Government did in that regard. Let me deal now with what is one of the soundest projects in North Queensland- the Kinchant Dam which is the irrigation project at Eton. What did his Government do about that? I will tell the House. Despite repeated requests over several years by the Queensland Premier, Mr Bjelke Petersen, for financial assistance, finally, after questioning in the House, the Prime Minister at that time, Mr McMahon, gave the House the answer that the Liberal-Country Party Government would not support the scheme and would not contribute one cent to it. That was the answer. When the Government changed I called for the papers and I found out that never had any investigations been carried out by the LiberalCountry Party Government- no investigations carried out by the Bureau of Agricultural Economics- nothing. Investigations were then carried out by my Government and the Kinchant Dam project was found to be one of the best possible projects. This Government immediately backed the scheme and gave a grant of $5m towards the construction of the Kinchant Dam. So do not ask me to listen to drivel about what the Liberal-Country Party Government did for

Let me turn to an event which has taken place in recent weeks. I have not heard one word from the honourable member for Kennedy, the Leader of the Australian Country Party (Mr Anthony) or the Deputy Leader of the Australian Country Party (Mr Sinclair) regarding the takeover by CSR Ltd of 3 sugar mills in north Queensland, despite the fact that every cane grower organisation in Queensland had made appeals to the Premier of Queensland to prevent the takeover and to allow the cane growers themselves to take over those mills as cooperatives. I have not heard one word in protest from the Australian Country Party. We know, of course, whom it represents. It represents the big monopolies in Australia. It represents the interests that allowed minerals and land in northern Australia to be taken over by foreign interests and plundered with tremendous dividends going overseas. I have not heard one word in protest by the Country Party on behalf of the cane growers of Queensland about the takeover by the CSR. I have not seen one mention in the newspapers of any protest on behalf of the Leader of the Australian Country Party or the honourable member for Kennedy, who is the shadow Minister for Northern Development, on this subject, which is a very delicate and emotional subject in the north at the present time.

Why has there been no such protest? Because it is quite clear that the Country Party supports to the hilt the takeover by the CSR of the sugar mills in north Queensland and is not in favour of allowing them to be converted into co-operatives by the cane growers. I get on very well with the CSR. I have tremendous respect for its international marketing ability and have said so on many occasions. But I do not agree with the way in which it has taken over these mills in north Queensland, nor does anybody else in the north. I assure honourable members that whilst I remain a member of this Parliament I will be doing everything I possibly can to influence the CSR to work with the sugar industry and to allow the cane growers themselves to take over eventually those mills as co-operatives. I repeat that I have never heard such drivel as has been spoken by the honourable member for Kennedy today. I move:

That the question be now put.

Question resolved in the affirmative.

Original question put:

That the motion (Mr Katter’s) be agreed to.

The House divided. (Mr Speaker-Hon. G. G. D. Scholes)

AYES: 55

NOES: 59

Majority……. 4



Question so resolved in the negative. water conservation. The honourable member spoke about Karumba. I do not know when he was last at Karumba. I would be interested to know when he was there. I was there several weeks ago -

Mr Katter- Yes


-Mr Deputy Speaker, I will tell you about Karumba. I will tell you what the Liberal-Country Party Government did for Karumba. Nothing!

Mr Katter:

– What are you doing about it?


-Order! The honourable member for Kennedy will cease interjecting. The Minister will address the chair.


-The honourable member for Kennedy asked me by way of interjection what I am doing about it. He believes I am doing nothing.

Mr Katter:

-Well, tell us.


-Approximately two months ago the Government notified the Queensland Premier of a grant and loan funds of approximately $3m for roads, water and sewerage in Karumba. I ask the honourable member not to run away. He should sit down and listen to this. But he does not know about it, of course. That indicates how much is his ability and competence as the Northern Development shadow Minister. He does not know about it. He does not read the papers. Apparently he is unaware of that. Admit the facts. You are completely unaware of the $3m for an all-weather road between Normanton and Karumba and for a water line between -

Mr Katter:

-It was $ 10m.


-Order! The Minister and the honourable member for Kennedy can conduct an argument outside this chamber as long and as often as they like, but in this chamber they will both follow the Standing Orders. I would suggest again that the honourable member for Kennedy does not interject and the Minister keeps to the point of the motion before the House.


-Thank you, Mr Deputy Speaker. What I am endeavouring to say is that the Government is very conscious of what is happening in the Karumba area. It spent millions of dollars in that region after the floods that ripped through Karumba. I happened to be in Karumba days after those floods, as anybody in the town will admit. I have done everything possible, while I have been the Minister, to get money for Karumba and I have succeeded, contrary to what the honourable member for Kennedy believes. Today Karumba is a better town; perhaps not much better, but at least it will have the benefit of millions of dollars worth of Federal funds for restoration and it will have the benefit of a pipeline for fresh water and an all-weather road to help the people. That is what this Government has done for Karumba. I am simply answering the honourable member’s questions, Mr Deputy Speaker. The thing that amazes me is that his Government was in power for 23 years, but what did it do?

Mr Hodges:

-What about the Chifley Government?


-The Chifley Government built the biggest project ever in the southern hemisphere- the Snowy Mountains scheme. That is what it built, and the Opposition boycotted its opening. I am glad the honourable member mentioned that because it would have slipped my memory in this debate that the Chifley Government was responsible for the biggest project in the southern hemisphere.

Mr Hodges:

– What else did it do?


-Order! The honourable member for Petrie will cease interjecting or it will not be merely a memory that slips.


-Of course, the Liberal and Country Parties opposed the Snowy Mountains scheme and boycotted the opening. That is what it thought about the Snowy Mountains Authority.

There are a few things that the honourable member for Kennedy might have mentioned about northern development but did not. He talked about the beef roads, which I have dealt with. I completely exposed his incompetence in that field by referring to the Clermont-Charters Towers road and the Boulia-Winton road. I completely exposed his incompetence in the field of water conservation by referring to the Burdekin and Kinchant dams. What did the Government of which he was a supporter do about other irrigation projects in Queensland? He did not make any mention of that.

page 1770




-I move:

I have not moved the motion to embarrass the Minister for the Environment and Conservation (Dr Cass) whose sincerity I have never doubted. I raise the matter as a censure against his Government and his rather insensitive colleagues, the Prime Minister (Mr Whitlam) and the Minister for Minerals and Energy (Mr Connor). I believe that the Minister for the Environment and Conservation has done his best. His colleagues have done their worst. They have stabbed him in the back. Let this never happen again to any future Minister for the Environment and Conservation. I hope that a future Liberal-Country Party government would not do this to its Minister for the Environment and Conservation. The consequences could well be devastating.

Fraser Island- incredible Fraser Island- the biggest sand island on earth, is now under ruthless attack. It is an island which could be classified, under the convention for the protection of the world’s cultural and natural heritage adopted by the United Nations Economic Scientific and Cultural Organisation in 1974, as an area of international significance. Fraser Island has been the best preserved part of the sandy coast of south eastern Queensland. It has vast resources of scientific and tourist interest. It is an island with a unique series of fresh water lakes, permanent streams, tropical rain forests of great and lush richness and magnificently coloured sands. The Australian Conservation Foundation has been a constant advocate for its preservation as a wilderness area or as a national park.

One of the essential steps to protect Fraser Island from exploitation is the preparation of a management plan aimed at preserving and making the most of the island’s distinctive assets. Those who argue against any such plan for Fraser Island argue that its resources are essential to the employment opportunities in Maryborough and the surrounding district. Whilst there may be some truth in this argument, it does not justify the Government’s decision to allow large scale sand mining to take place without a proper and objective study, survey and assessment. Once an industry commences in any given region, the employment opportunity which it establishes becomes almost sacrosanct to the people of the area. It has been an accepted fact of modern day planning that environmental considerations are an important dimension in any development project. This was recognised by Prime Minister McMahon in the former LiberalCountry Party Government. He was the first Prime Minister in Australia to introduce the environmental impact statement technique into decision making. Indeed the Whitlam Government stated its acceptance of the EIS technique and introduced the Environment Protection (Impact of Proposals) Bill 1974 on 26 November. Subject to one small amendment, the Opposition Parties supported the Bill. The Opposition commended the Government and the Minister for the Environment and Conservation for the legislation as indeed most environmentalists and conservationists applauded the Government’s action. What has happened since the passage of this legislation that was surely drafted to enable adequate inquiry to take place and thus save Fraser Island and other areas from malicious exploitation?

Let me trace the sad events leading up to D.M. Minerals’ obtaining Government approval to sell sand minerals overseas. These are the events as I know them. It they are not correct the Minister for Minerals and Energy may place the facts before the House.

Mr Connor:

– I shall certainly do that.


-On 20 November last year, the Minister for Minerals and Energy- that noted conservationist- wrote to that other noted conservationistthe Prime Minister- about election time in Queensland saying that he proposed to approve the application from D. M. Minerals for the right to seek export contracts. I understand that the Minister agreed with the strict conditions that the Queensland Government had placed on the company’s operations and its landscape restoration obligations. Whether this is right or wrong we do not know. As far as I know, the Queensland Government has not made these obligations public. I am not excusing the Queensland Government or any other government. We are led to believe that the Department of the Prime Minister and Cabinet contacted the Department for the Environment and Conservation for advice. That Department rightly advised that no action should be taken unless an environment impact study were made. This reply was sent on 22 November. It was on this day that the Prime Minister, who was caught up in the Queensland State elections, wrote to the Minister for Minerals and Energy agreeing to export approval. We understand that the Prime Minister also advised the Minister that prominent publicity should be given to the decision in the Maryborough area.

It was a political decision; it was not even an economic decision nor a decision in favour of social welfare. It was a callous, cynical, political decision showing no regard for the environmental protection of Fraser Island. The Prime Minister’s decision was taken in spite of the fact that the EIS legislation of his own Government was introduced into this Parliament by one of his Ministers on the same day. What a stab in the back! What hypocrisy! Apparently the Minister for Minerals and Energy wrote to D. M. Minerals on 13 December granting approval of the company’s request. As far as I know, the Minister for Minerals and Energy did not publicise his decision, for reasons best known to him. It was not until March this year that the truth came out, shocking the Minister for the Environment and Conservation and environmentalists everywhere.

It is significant that the Minister for Minerals and Energy advised D. M. Minerals on 13 December- 4 days before the Environment Protection (Impact of Proposals) Act became law. In other words, he went under the neck of the Minister for the Environment and Conservation. In camp drafting terms, he should have been ‘cracked off the field’. He beat the gun. He did not give publicity to it. We are told that the Minister for Minerals and Energy is a conservationist. Why did he act in this way? He is not the puppet of his Department; nobody would dare say that. Why did he not consult his colleague, the Minister for Environment and Conservation? I understand that they were good friends. There are suspicious circumstances. It is more than strange. To use an Australian colloquialism which everybody knows, ‘It stinks’. Why did the Minister for Minerals and Energy show such consideration and interest in D. M. Minerals- a part multi-national company- when he is so obstructive to other mining ventures? I cite the example of the Utah company in Queensland. Here again there are suspicious circumstances.

Let me repeat the dates again. On 26 November, the Environment Protection (Impact of Proposals) Bill 1974 was introduced by the Minister for the Environment and Conservation.

On 26 November- the same day- the Prime Minister wrote to the Minister for Minerals and Energy agreeing to the proposal being given to DM Minerals. On 13 December the Minister for Minerals and Energy wrote to DM Minerals granting approval. On 17 December the Government’s environment protection impact proposals legislation was proclaimed. It was not until March that the news leaked out. I understand it was leaked not from Government sources but from the company concerned. I wish to quote from a letter, a photostat copy of which came into my hands, which was written to the Prime Minister on 10 April 1975 and signed by Mr Nigel Wace. The letter read as follows:

I can scarcely imagine a more cynical or damaging way in which an Administration could subvert the intentions of its own Cabinet decision than this. If the issue of minerals sands from Fraser bland is allowed before the issue of an EIS, and a fair opportunity given in the courts for the public to challenge any such development, what reliance can we place upon this Government’s professed concern for the environment? And if the EIS legislation is thus undermined from the start, what hope is there that any future Liberal Government will pay any regard at all to an Act which is not even respected by the very party which promoted it?

The letter continues:

One of the reasons that I voted for your party in the last 2 Federal elections was that the ALP policy seemed to offer some hope that environmental issues within the community would be resolved by democratic- and ultimately by legalprocess. Your proposals for the compulsory issue Environment Impact Statements seem to go some way in this direction. The EIS is, in the field of man/environment relations, an embodyment of a truly socialist philosophy which allows the people to be subverted right from the start by permitting the export of dune sand minerals from Fraser Island before an EIS, or in defiance of its findings, you will forfeit my support.

I wonder how many other people feel as disillusioned as the gentleman who wrote that letter.

In a world of rapidly growing population, of severe inequalities, of underprivilege, hunger and disease, the Australian conscience in a relatively resource rich continent must look to its responsibilities in a world context and not only towards its own people. The dilemma is a very real one: On the one hand to conserve, on the other to produce. The judgment is one to which the Liberal and Country Parties are geared to respond. We recognise the need to achieve a balance between the conservation of the environment and economic growth in the knowledge that people not only demand a better environment for themselves and their children but demand also jobs, better houses, better nutrition and better services. This is the great challenge for the world in the last part of this century. But it is clear that certain disciplines need to be followed to achieve this balance and to prevent a Fraser Island happening again.

A Liberal-Country Party government will invoke the principles of the environment protection legislation introduced by the Minister for the Environment and Conservation. We will ensure that prior to decision making an EIS is prepared for. any development project under Commonwealth control. We will make these assessments public before Government decisions are taken. We will ensure that EIS are publicly available before Government decisions are taken and will refer controversial projects to an independent commission to hear evidence from the public and inquire into and report on controversial projects. Let us hope that this brutally dishonest raping of Fraser Island by a Government which has posed as being environmentally conscious marks the beginning of a new era, a new era where development at all cost, where jobs at all cost, where profits at all cost, give way to a more sensitive public determination to balance growth, jobs, profits and standards of living against the needs of posterity and the quality of life.

Environmentalists have a cause for resentment. They have a justification for frustration and disappointment. The Whitlam Government clearly went to the people in 1972 and again in 1974 with a policy that attracted. Yet it introduced a Bill- and it did so with the support of the Opposition- to protect the environment from this sort of intrusion, and 4 days before its proclamation it defied its own Cabinet, its own Caucus decisions and, indeed, its own law. The Opposition shares this disappointment, resentment and frustration and expresses its deep concern that the whole EIS concept is a sop to conservationists which will be thrown to them while the real decisions are made by hard-headed profit takers and politicians behind closed doors. Little wonder that the Minister for the Environment and Conservation (Dr Cass) issued his low key Press statement on 25 March and announced the establishment of an inquiry which it was hoped would influence the mining of the approved leases on Fraser Island. I read from that Press statement:

The Australian Government is constitutionally responsible for the granting of export approvals for minerals and other resources and so the inquiry -

Which he announced on that day - will be concerned, amongst other things, with proposals for sand-mining on Fraser Island which require export approval.

DM Minerals has in fact recently received Australian Government approval to negotiate export contracts for specified quantities of rutile and zircon and the Australian Government will honour its approval.

The Company proposes to fulfil these contracts from 2 mining leases on Fraser Island- Nos 102 and 95- which had been previously granted by the Queensland Government.

They are very significant contracts, as I think the honourable member for Wide Bay (Mr Millar) will probably agree. In fact, he says they are the most significant areas presently being contemplated as a mining area. Dr Cass’s Press statement continues:

I expect that the findings of the inquiry will influence the mining of these leases and make recommendations on the future uses of the island.

Submissions to the inquiry will be invited and it is expected that hearings may be conducted in several centres.

This is all very well. The Minister for the Environment and Conservation has done his best but the horses are out of the yard. He knows that they got out of the yard before he could shut the gate. An inquiry is being held in respect of a fait accompli. The rights to export the minerals have been given and so an inquiry is now to be held, I suppose, in the hope that the minimum amount of damage is done to the environment, to the sand dunes and the island in the course of those mining operations.

I conclude by saying once again that I hope that this incident, which will become known as the Fraser Island incident, ushers in a new era where governments in future will never undertake or give approval to development projects of this kind without first undertaking an environmental impact study- an assessment- and making the result of those studies public, and without giving the public an opportunity to put their case. 1 refer not only to the uninformed public but also to the scientists and others. I hope that we will introduce into our thinking, planning and development this very important dimension which is so essential for future generations that will live on this earth.


-Is the motion seconded?

Wide Bay

-Yes, Mr Deputy Speaker, I second the motion. I do so with a great awareness of what a serious impact the Fraser Island issue is having upon the electorate of Wide Bay, particularly in the Fraser Island-Maryborough-Hervey Bay area. I am very concerned because I see the issue driving a wedge into the community affected. It is sad to see people who have lived in unanimity and accord displaying attitudes of great hostility towards one another. I am on record as expressing more than a little sympathy with the need to maintain some balance in the matters of conservation and environment. I am painfully aware of the depressed state of the Maryborough district and the urgent need to stimulate it.


-Order! As it is now 2 hours after the time fixed for the meeting of the House, the debate on the motion is interrupted.

Motion (by Mr Daly) agreed to:

That the time for the discussion of notices, general business be extended until 12.43 p.m.


– I emphasise again the urgent need to act in a responsible manner to maintain employment opportunities in an area depressed at the moment. Over and above all that is my concern as to the credibility of a government. Should it be established that credibility is absent there must flow through to the parliamentary structure as a whole some odium as to the Government’s fitness properly to represent the people. This comes at a time when, because of our extremely serious economic and social condition, there is a need to rally the people of Australia to assume their responsibilities in meeting our more major and serious problems. It worries me as a parliamentarian that I can address constituents of Wide Bay and with a sense of conviction and some veracity argue that governments are shouldering their responsibilities. The credibility is very much at challenge.

We have heard the honourable member for Gwydir (Mr Hunt) outline the history of events dating back to the appearance on the scene of the Prime Minister (Mr Whitlam) during the Queensland election, when he confirmed the declared attitude of the Government as being extremely interested in and responsible for the environment. The Queensland electorate seemed to give some indication through the ballot box as to the belief it had in the Prime Minister. Subsequent to that there appeared on the scene a man whose personal credibility was not in doubt. I refer to the Minister for the Environment and Conservation (Dr Cass). He visited Fraser Island, and he too could have done nothing else but fall victim to the charm of that island and its extraordinary, unique features. He gave the people in the area and the conservationists great encouragement when he declared his attitudes and said that it was his intention to prevail on the Government to take measures to arrest the sand mining operations until such time as a proper environmental impact study could be made.

Honourable members can imagine the utter confusion and anger that resulted from the announcement that a licence had been granted by the Australian Government to mining companies for the export of minerals extracted from Fraser Island sands. In such extraordinary circumstances one would find it exceedingly difficult to resist arguments that there may have been some impropriety. What extraordinary circumstances could have prevailed upon a Minister of the Government to seemingly betray his colleague? The immediate response from the spokesman of the Fraser Island defence organisation is noteworthy. It should be borne in mind that he is the epitome of those people who flocked to the Australian Labor Party under the misguided belief that it was the champion of conservation. I know Mr Sinclair well. I know him as an admirable gentleman, and I have a respect for the intensity of his feelings in this matter. I do not necessarily endorse them, but I realise that he is a man of consequence. No one else would have been more dedicated to the declared ambitions of the Labor Government in preserving the environment, but he was moved to send a telegram, immediately after the declaration of the issue of licences, to the Opposition spokesman on the environment in the following terms:

The sand mining of Fraser Island is now seen by conservationists throughout Australia as a betrayal of trust by the Australian Labor Government that promised that export licenses would be withheld pending satisfactory environmental impact statements stop Dillingham Mining Company claims to have received export license in December stop Stopping wanton sand mining of Fraser Island provides a test case of sincerity in conservation matters stop The devastation can be avoided by decisive action by the Australian Labor Government stop We urge Australian Government to summon the courage to stop this wanton rape of the irreplaceable wilderness area

What a positive statement. What greater evidence would one require of the absolute sense of betrayal among those who fought to achieve an objective that they consider is of paramount importance? This problem must be resolved. To whom do they turn for its resolution? Is there anybody in whom they may have confidence and faith? Can they confidently accept that undertakings and promises will be fulfilled? Can they believe the present undertaking that the inquiry to be conducted will be conducted in a spirit consistent with the whole conservation concept, or is it just another delaying device which will perpetuate the record of sad irresponsibility and dereliction of this Government in the area?

I do not condemn the Government for acknowledging and declaring that a contract is a contract and it is obliged to fulfil the terms of that contract in the first instance. I have argued inside the Parliament on another Bill and outside the Parliament that the day we depart from the concept that a contract is an agreement obligating the parties to provide or adhere to certain conditions we abandon our moral standards as well as our regular legal practises. A contract exists and arguments must be accepted that it should be adhered to. So long as it does not stop at that. If the Government is determined to take every opportunity to undo the mischief which unquestionably has occurred let it address itself purposefully to the matter. Let it acknowledge that whilst the contract may prevail at this point of time no stone shall be left unturned to stop the sand mining of Fraser Island. I do not mean stopping it to effect an injury to those who are very dependent on the economic benefits that may flow from it in the short term. I refer to those people in Maryborough who look forward with a great deal of hope to the economic benefits and job opportunities that will flow from the sand mining operation at Fraser Island. They must be catered for. Until such time as the employment slack can be taken up I would suggest that the overall position can best be served by a restricted activity in the areas where minimal damage will be done on Fraser Island and by giving the sand mining companies clear notice that the moment the need to serve the Maryborough community to relieve unemployment has passed measures will be taken to stop the sand mining activity.

I would suggest that the sand mining activities now are a product of the lack of social awareness by those who have gone before and those who currently hold responsibility for these matters. Society must assume a responsibility for having erred in entering into a contract for this sand mining. As the Government represents society in this matter, it is not unreasonable to argue that the Government should be prepared to terminate the contract on the basis of an amicable and amenable agreement with the companies to leave the Island undisturbed and to compensate them to a reasonable degree for the profits they will have lost. After all, the very essence of the operation is to engage responsibility and legally in this sand mining activity for profit. Therefore if the company can derive the end benefit from this contract without mining sand, clearly there is no valid argument to offer that the mining operation should continue. If the sand miners resisted such an argument I would suggest that they would have proved their lack of social responsibility and the Government then would be morally free to deal with them in a manner which it considered appropriate at the time.

The bonds on guarantees of redemption provide a totally inadequate insurance for the restoration, meaning the preservation, of the island in its original state. The $30,000 for each mining plant operating is totally inconsequential considered against the total expenditure involved in the rehabilitation program which is estimated as being as much as $1,000 to $2,000 per acre. But over and above the cost of this operation, anyone who has closely viewed the majesty of the high dunes on the ocean beach of Fraser Island could see the act of mining this area, of destroying its virgin state, as nothing less than an act of desecration. Whilst man has a prime obligation to meet his needs to survive he is obliged to do so in a responsible manner. We are at a point now where we are, in all innocence or ignorance, party to this contract.

The Government of Queensland has created a situation which commands the attention of the nation and it is now up to the government concerned to try to restore the situation. But coming out of the entire discussion, the entire confusion, emerges the fact that the Government of Australiathe Federal Government- has betrayed its faith to the conservation movement. Having betrayed its faith to the conservation movement, can we look forward to this Government acting in a responsible manner in similar circumstances in an area which shows the scars resulting from a wound deeply inflicted no more than 12 months ago by the Minister for Transport (Mr Charles Jones), who gave the firmest undertaking to this sadly afflicted area in regard to the Walker shipyard? The community which I am proud to represent has been left in a very sad state because the Minister, in the opinion of the people of my electorate, has betrayed their faith.

Minister for Minerals and Energy · Cunningham · ALP

– The honourable member for Wide Bay (Mr Millar), who just resumed his seat, has placed his finger on the most sensitive section of this issue. He said that the Government of Queensland has created a situation which has now been drawn to the attention of the Australian nation. When we came to office we were faced with a situation created by the Government of Queensland, a Country Party Government which has ruled Queensland for many years and which has granted leases and mineral rights according to its own legislation and is now in the process virtually of being criticised by its own Country Party members.

There has been more heat than light generated in the whole of this so-called controversy. I will yield to no one my dedication to a proper balance between mineral development and the preservation of the environment. I have stressed in the whole of this matter that I acted with very great reluctance and would see to it that the conditions that were imposed by the Queensland Government in respect of the mineral leases which have been granted were honoured to the letter. I have not the slightest doubt that I will have the fullest support of my colleague in this regard.

The situation on Fraser Island is not new. For example, Queensland Titanium Mines Pty Ltd has been operating on Fraser Island right alongside the areas where it is proposed to mine. Not a word was said about that. Not a word was said about the conditions which are actually imposed by the Queensland Government. Not a word was said about the deposit of $30,000 and the fact that no more than 20 acres is to be mined at any one time and then is to be regrassed and the herbage and vegetation generally to be restored. Only after this is done can a mining interest go on to another situation and mine another 20 acres until 100 acres are mined and, provided that has been done satisfactorily, the land is restored to the ownership and control of the Queensland Government. In addition to that there are specific requirements in regard to the type of sand that is to be used. There are specific requirements as to the vegetation, the trees and the shrubs, that are to be restored.

There has been a lot of humbug in this matter. Of course, some political mileage can be gained but, to be very frank, some of the most perfervid critics of the Government in this matter have done their own cause a notable disservice because of the excesses of their criticism and the unwarranted ferocity of their approach to this situation. Since 1960 the Murphyores people, who make up one half of the consortium, have been busy in that locality with the consent of a Country Party government. They are still there. In 1972, having had rights there before and carrying on quite an amount of exploration work, they took advantage of legislation introduced by the Queensland Country Party Government to obtain leases. The honourable member for Gwydir (Mr Hunt) has been less than frank, because he well knows the contents of the leases and terms on which they have been granted.

One thing that we have stood for since we have become a government is this: Whatever situation we found we would honour contracts that had been entered into. The 2 leases, which are numbers 95 and 102 from memory, on which the D.M. Minerals people will be concentrating, were granted in 1973. 1 want to refer to the constitutional situation. The Australian Government has no direct constitutional power to interfere with internal mining. The honourable member for Gwydir knows full well- he has had sufficient Parliamentary experience- that the terms of the legislation to which he gave such fulsome praise makes provision for the protection of the environment in relation to projects and decisions of or under the control of the Australian Government. Environmental impact study can be carried out under Queensland legislation, namely the State and Regional Planning and Development Public Works, Organisation and Environmental Control Act. The Queensland Minister for Mines has a discretion under that legislation as to whether or not he will have such an inquiry. He did not in the particular cases mentioned. Now his Country Party colleagues in the Federal Parliament are coming along and are wanting to clobber us and criticise us for the shortcomings of the State Government in respect of the leases which were granted under the terms of the Queensland legislation. That is the position. The attack by the honourable member for Gwydir is humbug and nonsense- utter stark humbug. Let me quote -

Mr Ellicott:

– Why do you not use the power you have got?


-We shall use it, and we shall use it to the letter, and we shall be watching the mining operations there very closely. We will be glad of the co-operation of the honourable member too. He knows the constitutional position as well as I do in view of the former high office he held in the Australian Public Service.

Mr Hunt:

– You had our co-operation on the Bill.


– Yes, thank you. The situation is this: The best that my colleague can do in respect of any inquiry that he may hold is to get people to come along almost as an act of grace. He has asked these people whether they will agree to defer their operations. They have said no. We were confronted with a situation and we did the right thing. The Prime Minister (Mr Whitlam), knowing the constitutional problems and the limitations on the Federal Government in respect of mining within a State and under State law, last year quite deliberately sought by successive correspondence to get the cooperation of the State premiers. In certain cases he will get co-operation. The very essence of his approach was that there should be joint inquiries. If the honourable member for Gwydir is sincere and genuine let him get busy and make his representations to the Premier of Queensland, his Country Party colleague. Let the Premier come along and, in a joint inquiry, have a look at Fraser Island. The whole attitude of the honourable member for Gwydir is nonsense, sheer, stark hypocrisy and political vote getting of the worst possible type.

Mr Hunt:

– Why did the Government give approval before it became law?


-That has no relevance whatever. The first approach made by DM to the Government was last April. It was entitled to make an approach. Would the honourable member deny that? Of course he would not. The company had its leases. We had to face up to a situation which we did not create but which we inherited. The honourable member well knows that. But he comes here today and with stark hypocrisy tries to extract some -

Mr Hunt:

- Mr Deputy Speaker, I take a point of order. I find the word ‘hypocrisy’ very offensive.


-I ask the Minister to withdraw.


– Yes, of course. I have listened to worse from the honourable member but I am not the squeamish type. I shall read a letter from the Prime Minister to each of the State Premiers. It is dated 9 July 1 974 and it states:

My Minister for Minerals and Energy and Minister for the Environment and Conservation have now recommended, and I have agreed, that in future, when seeking approval for export contracts for these minerals -

The minerals are named- derived from new sand mining ventures, the precise source from which the mineral is to be obtained should be stated together with full information concerning the environmental considerations and safeguards that have been submitted to our colleagues the Ministers for the Environment.

In effect, this means that my Government will expect future applications -

I stress the words’ future applications’- for approval of export contracts for new ventures -

I stress the word ‘new ‘- for these minerals to be accompanied by an identification of the precise source of the mineral and by evidence that the environmental consequences of the mining operations have been studied and found to be satisfactory. Insofar as this might require the preparation of environmental impact statements for submission jointly to the appropriate State and Australian Government Departments concerned, I suggest that this specific matter be referred to our respective Environment Ministers at the meeting which we agreed at our Conference on 7 June should take place shortly. No doubt you will wish to refer this matter to your Minister for Mines in order that his views may be available to your Environment Minister prior to the proposed Conference.

Being faced with an application from these people, knowing their long standing rights and knowing the relatively stringent conditions which the Queensland Government was imposing I was faced with the situation as to what I ought reasonably and fairly to do. I wrote to the Prime Minister and put the situation to him. My letter was dated 20 November- a copy of which the honourable member for Gwydir somehow obtained- and it stated:

An application has been made by DM Minerals, a partnership consisting of Dillingham Constructions Pty Ltd and Murphyores Inc. Pty Ltd for approval of an export contract covering mineral sands that will be produced on Fraser Island, Queensland. While representations have been made by environmentalists against sand mining on Fraser Island, I bring to your notice that, in my judgment, it would be inappropriate to take action which would prevent this particular project from going ahead on mining leases already granted. Accordingly I propose to approve the export contract.

You will recall that you wrote to the Premiers of Queensland, New South Wales and Western Australia on 9 July last regarding the environmental aspects of mineral sands mining. In your letter you referred to procedures recommended by Dr Cass and I, to which you agreed, with regard to future applications for approval of export contracts covering mineral sands derived from new sand mining ventures.

The application by DM Minerals relates to mineral sands to be produced from mining leases that were granted before you wrote to the Premiers. I am informed that mining leases had been granted on 10 April and 23 August 1 973, following which, in January 1974, the partners announced details of the venture.

No blow-ins, no fly by nights.

Mr Hunt:

– Will the Minister table that letter.


-Yes, I will table a copy of it. It continues:

Further mining leases were granted on 13 June and 4 July 1974. These are dates whenlease documents were issued and conditions of mining set down. However the areas concerned had been covered by authorities to prospect granted during 1961 and 1962 . . . By July this year the parties had outlaid substantial funds on the project and had also advanced their negotiations for the ultimate export of the mineral sands.

The letter then goes on to cite the terms of the leases to which I have referred. The final paragraphstates:

From the above you will appreciate that the project had been launched prior to your writing to the Premiers and that the State Government has imposed obligations on the partners to rehabilitate mined areas. Through my Department we would take steps, in granting export licences, to maintain a continuous scrutiny of the partners’ operations to ensure that they are living up to their obligations.

I assure the House and the people of Australiaincluding the fair minded conversationists- that we will thoroughly, systematically and persistently scrutinise the terms under which and the way in which these people mine the respective areas. In reply, I received a letter from the Prime Minister dated 26 November. It states:

I refer to your letter of 20 November concerning the application for approval of an export contract by DM Minerals, to cover mineral sands to be produced from Fraser Island, Queensland.

I have noted your comments on the advanced stage in planning and expenditure which the company have reached before the date of my letters of 9 July to the Premiers of Queensland, New South Wales and Western Australia, and on the steps being taken to ensure protection of the environment. In these circumstances I agree with your proposal to grant approval.

I do think that we should ensure that your decision and the reasons for it are given early and appropriate publicity . . . (Extension of time granted). The actual contract was presented on 13 September. It was vetted and found to be satisfactory. Its terms as to price, delivery date and the like, are naturally confidential. But this can be said: Once a contract is approved it follows that export permits will be granted if as and when the necessary production follows. That will be done. But if, by any chance, it is found that this consortium is not adhering to the terms of its contract there will be no doubt as to what action will be taken by me. In that, I shall expect and receive the assistance of my colleague the Minister for the Environment and Conservation (Dr Cass).


-I call the honourable member for Bendigo.

Motion (by Mr Daly) agreed to:

That the question be now put.

Question put:

That the motion (Mr Hunt’s) be agreed to.

The House divided. (Mr Speaker-Hon. G. G. D. Scholes)

AYES: 53

NOES: 59

Majority……. 6



Question so resolved in the negative.

page 1777



-In the very few moments that are available to me I want to move a most important motion which I hope will commend itself to both sides of the House. I move:

There are some people who are ill advised enough to disparage what they call the Australian dream- home ownership. Indeed, there are some people who, for political reasons, desire to prevent and limit home ownership. We all remember a remark that was made in this House when Labor was the government a long time ago and somebody from the Liberal side said something in favour of extending home ownership. A Labor Minister- he is now dead- got up and in this House he said: ‘We are not in favour of creating little capitalists’.

Mr Garrick:

– That is not what he said at all.


– It is in Hansard and it is what he said. Although the Australian Labor Party pretends to be in favour of home ownership the left wing of the Labor Party wants to prevent home ownership because it believes that the ownership of a home is something which stops a person being radical and revolutionary. One of the ways in which the Communist Party has exercised its influence inside the Labor Party is to commit it- ‘commit’ is the wrong word because they are openly in favour of home ownership- by underground, underhand methods to do things to limit the ability of Australians to own their own homes. I refer to the pensioner who has his own home. He saved during his lifetime to realise his part of what is the Australian dream, and he is ready to retire. By an industrious life he has perhaps made economies. He has saved enough to pay for his own home, and he is sitting saying to himself: ‘Now I have no mortgage. I have my home. My pension will come in and I will be comfortable’. That was all right until he received his rates bill and his water rates bill. I know that with the inflation that has occurred these bills have become exorbitant. By the way in which the Federal Government has allocated revenues into its own hands, local government finds it hard to carry on.

In some States- I think particularly of my own State of New South Wales which, happily, is under the command of a Liberal State Governmentby reason of what the governments have done pensioners are relieved of part of their rates. This is a very commendable thing, but this very commendable initiative is not uniform throughout Australia and in many ways it is capricious because its application, even in New South Wales, depends not wholly but in part upon the attitude that local governments take in regard to the extension of this particular concession. I do not think that this is good enough. I do not think that the burden should be placed on local government which is already hard enough pressed by the way in which this Government as gone on in regard to revenue.

The Federal Government has made it impossible for local government to proceed effectively without Federal handouts and it now makes a great fellow of itself by giving handouts to cure the conditions which it has created. We cannot expect local government to be bearing too much of this burden. This is a situation which can be met and which has been met in other countries. For example, one thinks of what is done in Great Britain with regard to the deferment of rates. This is the kind of constructive proposal I would put forward, which in the long run is not costly but which requires liquidity arrangements in order for it to be carried out.

Mr Daly:

– It is a wonder you did not do it 20 years ago.


– I am indebted to my honourable friend for asking why it was not done 20 years ago. It was one of the things on our program which was to be done, and we did a great deal. Certainly if the Minister will do me the honour of looking up the matter -


-Order! It being 12.45 p.m. the time allotted for precedence to general business has expired. The honourable member for Mackellar will have leave to continue his speech when the debate is resumed. The resumption of the debate will be an order of the day under general business for the next sitting.

page 1778


CanberraAttorneyGeneral and Minister for Police and Customs · ALP

Customs Tariff Proposals Nos 1 1 and 12 ( 1975).

Mr Wentworth:

– I take a point of order, Mr Deputy Speaker. Did you call the Minister for Police and Customs? Am I right in thinking that?


-That is quite right.

Mr Wentworth:

– It is becoming a police state.


-The Customs Tariff Proposals I have just tabled relate to proposed alterations to the Customs Tariff 1966-1974. These Proposals formally place before Parliament, as required by law, tariff changes introduced by Gazette Notices during the last recess. The changes arise from the Government’s decisions on recommendations by the Temporary Assistance Authority in its report on: domestic refrigerators, washing machines and clothes dryers; and precision ground steel ball bearings.

A comprehensive summary setting out the nature of the changes in the duty rates and the origin of each of the alterations contained in the Proposals is now being circulated to honourable members. I commend the Proposals.

Debate (on motion by Mr Lynch) adjourned.

page 1778


Second Reading

Debate resumed from 8 April on motion by Dr J. F. Cairns:

That the Bill be now read a second time.

Deputy Speaker, that you permit the subject matter of the 4 Bills to be discussed in this debate.


-Is it the wish of the House to have a general debate covering these 4 measures? I will allow that course to be followed.


-The legislation before the House reflects this Government’s continued failure- its stubborn refusal- to control public expenditure. There is obviously no limit to the Government’s capacity to spend money. For 2 years the Australian public has witnessed a government spending spree without precedent. In just 2 years the Whitlam administration has lifted Federal spending by a massive 75 per cent. Is it any wonder that the private sector- individuals and companies- is being bled dry by taxation to pay for the Government’s spending commitments? Is it any wonder that the Government now faces a domestic deficit 6 times larger than the previous record? Is it any wonder that inflation is crippling the productive capacity of the Australian economy?

Appropriation Bills (Nos. 5 and 6) seek approval for an additional $640m to be spent this financial year. This brings total outlays for the year to $17.9 billion. It means that Government spending will have increased by 45 per cent in one year alone. When the Budget was introduced in September, the Parliament was told that spending would amount to $16.3 billion- an increase over the previous year of 32 per cent. At that time the Opposition called for a $ 1 billion cut in spending. We made it quite clear then that a growth in Federal spending beyond 25 per cent was completely irresponsible. But the Government has not cut spending- it has increased spending by almost $2 billion. Government spending has placed an intolerable taxation burden on the community and has contributed to the current excess rate of monetary expansion. In simple terms, the Government is permitting expenditure to run ahead by the simple expedient of deficit financing. The deficit recorded for the 9 months to March this year was a record $3.3 billion. During this period the Government spent $3.3 billion more than it raised by taxation. To balance the books, it has printed money. To judge from what the Treasurer (Dr J. F. Cairns) has been saying recently in this House, that policy of printing money regardless of economic consequence will certainly continue. The House might well recall with a sense of undue irony that the September Budget called for a domestic surplus of $23m.

The Government’s public record on Federal spending is confused almost beyond belief. At the 1974 Premiers Conference the Prime Minister (Mr Whitlam) said this:

As part of the battle to contain inflation, we will be following a policy of restraint in our own spending.

The former Treasurer confirmed this in his July 1 974 mini-Budget when he said:

The Government acknowledges that public expenditure must be restrained.

It is now history that the Whitlam-Crean expenditure cuts were reversed by the Caucus in July. The Crean Budget proposals were reversed by Dr Cairns. Instead of a Budget of moderation and restraint, expenditure was programmed for a 32 per cent increase- a policy of ‘full steam ahead’. But the man who drafted this year’s Budget, the present Treasurer had a change of heart as soon as Mr Crean ‘s fate was determined. The House might recall the story written in the ‘Australian’ of 23 November 1974 headlined: ‘Cutting Budget may get Cairns first attention’. That report stated:

Ways in which the Federal Government can cut back on some of its programs may among the lint matters to be looked at by the Deputy Prime Minister, Dr Cairns, when he becomes Treasurer. Dr Cairns foreshadowed yesterday that transport and roads could be likely subjects for a cutback.

The following day the ‘Sun-Herald’, in a story headed ‘Cairns Axe poised to chop down big spending’, had this to say:

The incoming Federal Treasurer, Dr Cairns, is preparing a ‘ chopping list ‘ of Government projects and plans that can be savagely axed . . . Priority areas likely to get the axe are the big Government outlay on roads, other transport expenditures and decentralisation and ‘Growth centres’ spending. The moves will be the first of a ‘ strongman ‘s ‘ action when Dr Cairns assumes the Treasurership in two weeks time.

The Treasurer-elect apparently saw no problems. In fact, he is on the record as saying that there were some areas of Government policy which could not be fulfilled ‘no matter how hard the Government tried ‘. The reason for that, according to the then Treasurer-elect, was that shortages of resources had ‘created large built-in surpluses in the Budget’. I ask a question in this debate: What happened to the strong man who was going to axe Government spending? More importantly, what has happened to the so-called large built-in surpluses? The answer is quite simple: Dr Yes is a deficit financier.

The Treasurer quickly returned to the original ‘full steam ahead’ Budget philosophy. No cuts were made. Expenditure was increased on at least 5 separate occasions. But at the beginning of 1 975 the public was told of a further reversal. On 29 January the ‘Australian’ newspaper, in a story headlined: ‘Whitlam to Slash Rising Spending’, stated:

The Federal Government will cut the growth rate of its spending.

Three weeks after the initial announcement of Government spending cuts there was a further public announcement. On 19 February the Melbourne ‘Age’ headlined a front page story in the following way:

Labor to slash spending- only job projects will escape cuts.

The transcript of the Prime Minister’s Press conference on the previous day showed that he had no idea what policy he was implementing. For example:

Question: Can you give us some idea of the amount of money involved?

Mr Whitlam: No.

But the Prime Minister sought to give the impression that the Cabinet’s so-called expenditure review committee would review spending proposals announced in the 1975-76 Budget. He was asked which programs were involved and he answered in these terms:

I am not going to respond. The fact is that if I were naming any of these items I would immediately be swamped with pleas to continue the particular item which is being deferred.

Has the Prime Minister agreed to a limitation of spending? Why does he refuse to say where the cuts will take place or what the overall amount of the limitation on Government spending ought to be? Why is the Government now seeking to increase spending by a further $640m? If the Prime Minister believes that Government spending should be reduced, why is the Government going ahead at 45 per cent now instead of 32 per cent as originally planned in the Budget? Apparently the limitation of spending by a process of Cabinet review has been abandoned. On Tuesday the Treasurer was asked if printing money was a good economic solution. He agreed that it was, inconceivable as that answer might be. On Tuesday Dr Cairns told the House that Government spending would continue to increase without restraint. On Wednesday the Prime Minister stated that no action would be taken to reduce the deficit. According to Dr Cairns, the. present Treasurer of this country, Government spending has little to do with increases in inflation throughout the economy. I refer to his inconceivable statement:

Inflation is now built into the economic system because of the monopolistic nature of the private sector and because of the strength and militancy of organised workers.

The Whitlam administration clearly has no idea whatever where it is heading so far as the Australian economy is concerned. It changes economic policy on a monthly or quarterly basis. In less than one year alone it has publicly reversed its approach to Government spending on at least 4 separate occasions.

What are the prospects for the coming financial year? Clearly this is in the hands of the Government. But the policy statements of the Prime Minister and his senior Cabinet colleagues this week have confirmed that the present rate of increase- 45 per cent- will be maintained. Committed expenditure is to be maintained in real terms. Education spending is to be doubled during the course of the next triennium. The new health insurance, compensation and superannuation programs are to proceed at an annual cost of around $4.9 billion in 1973 money terms. The Supply Bills now before the House, however, indicate the likelihood of a higher rate of increase. Expenditure by way of the Supply legislation before the House is to be 62 per cent higher in the first 5 months of 1975-76 than it was during the same period of the previous year. If the Supply appropriation has the same proportional relationship to overall outlays as it did last year, Federal spending for 1975-76 will be around $29 billion. This would be nearly 3 times greaternearly 300 per cent higher- than the $10 billion spent during 1972-73. Whether spending maintains its present annual rate of increase of 45 per cent or accelerates towards the figure of 62 per cent, the impact will be the same. Expenditure at these levels implies inevitably higher and higher taxation, an increasing transfer of resources from the private to the public sector and, under this Government, continuing large scale deficit financing.

Sitting suspended from 1 to 2.15 p.m.


– Prior to the suspension of the sitting I had emphasised that expenditure by way of the Supply Bills before the House is to be 62 per cent higher in the first 5 months of 1975-76 than it was during the same period of the previous year and that if the Supply appropriation has the same proportional relationship to overall outlays as it did last year, Federal spending for 1975-76 will be around $29 billion or 300 per cent higher than the $10 billion spent during 1972-73. How long can this inflationary spending go on? Economists have criticised it, Government advisers have warned against it and leading newspaper editorials have unanimously condemned it. When the Australian electorate is finished paying for the next Budget, I believe that it will demand an end to it. The Government has sought to exploit inflation. It has deliberately used inflation as a silent tax to appropriate funds from the private sector by government taxation and government borrowing. The Australian electorate certainly has not voted for the huge tax increases which have taken place nor has the Government legislated for them. The present rate of tax increases must lead to further declines in individual initiative and to further reductions in the community’s propensity to save, which, of course, is the very basis of private capital formation. In a very real sense excessive taxation not only fuels inflation but also strikes at the essential fabric of a free enterprise economy. New government programs and handouts will always be superficially attractive to the electorate. But the fact is, as has been said before, that there is no such thing as a free lunch- nobody gets anything for nothing. *

Increases in overall national welfare, however desirable, cannot proceed at a pace beyond the economy’s capacity to sustain them. We believe that the Government must understand that it is the private sector which creates our real national resources and the public sector which distributes them. The greater the call on resources made by the Government through the mechanism of taxation the less are the resources which remain for re-allocation towards productive ends within the private sector. The enormous revenue demands of the present Government, together with the huge increase in wage and salary costs, have had a disastrous effect. The present share of the gross domestic product held by corporate profits must be increased and this cannot be achieved by productivity increases alone. Either prices will have to run ahead of money wages or company taxation- preferably by changing the basis of taxation- will have to be lowered. A combination of both elements may have to occur. It is essential in the national interest that adequate levels of corporate profitability be restored as a matter of urgency. If this fails to happen there will be no investment recovery. Without a return to adequate levels of investment the economy’s capacity to meet future demands will be severely diminished.

There are, of course, further reasons for a reduced level of expenditure. An effective antiinflationary policy must rest on restraint by all groups in the community insofar as their claims on economic resources are concerned. Restraint by the Federal Government is essentially to encourage restraint by the community at large. In addition, international evidence strongly points to the fact that rates of inflation and public expenditure are directly linked. For example, the 1974 Australian survey by the Organisation for Economic Co-operation and Development reported:

The available evidence suggests that . . . the change in the rate of inflation has been the greatest in those countries where the increase in the share of public expenditure has been the most rapid.

The New Zealand Labor Government has recognised the need to restrain public expenditure and just recently the British Labour administration has adopted the same basic course of action. But international evidence is apparently of no consequence to the Australian Government. World inflation rates are now falling. This is true on an average basis as measured by the OECD. It is also true for the major economies such as Japan and the United States. But it is not true for Australia.

The Opposition Parties believe, as has been made clear on previous occasions, that there is no alternative other than a reduction in Government expenditure. In this regard I would draw the House’s attention to the ‘Australian Financial Review’s’ editorial of 14 April, which I believe has graphically summed up the views being expressed throughout the Australian press at the present time. The ‘Financial Review’ said:

Any amount of good advice will be wasted as long as the Government’s economic policy is influenced by the irresponsible demagoguery of the present Treasurer, Dr Cairns . . . For despite the diversity of opinions and policy recommendations among economists and civil servants, all economists of all persuasions, at every point on the political spectrum, agree that a continuation of the present rate of public spending financed not by taxation but by an effective use of the printing press can only be disastrously high inflation and the corollary, eventually a disastrously high rate of unemployment.

The Opposition Parties believe that the Government must face up to the economic reality of the situation at this time. It cannot go on spending money without regard to the economic consequences of that policy. Government policy is not a cure-all for Australia’s social problems. In fact, at its present rate it could well be exactly the opposite. It is time for a change in the basic course of Government policy. We believe that the Treasurer must show, during the course of what is a very important debate in terms of the economic dialogue taking place in this country, that he is now prepared to curb the rate of spending and, in this way, set an effective brake on the mounting inflationary spiral that is so evident throughout the Australian economy at the present time.

Minister for Overseas Trade · Melbourne Ports · ALP

– I enter into this debate to say one or two things about the proposition that the Opposition seems to be advancing at this stage that somehow the progress of governments is to be decided upon the basis that what are called deficits are somehow wicked in themselves and surpluses are virtuous. The Opposition seems to have acquired that new virtue rather suddenly. I say that because if one looks at the history of the previous Liberal-Country Party Government one will see that there were very few years in which it was in office in which government expenditure did not exceed revenue. I ask those honourable members who may have any doubts about that to look at the table on pages 124 and 125 as well as 2 earlier pages of the Budget Papers of the last Budget, which, by the way, I was responsible for presenting, concerning the Australian Government’s Budget in a national accounts form. They will find that, invariably, over the last 10 years, governments have spent more than they have collected in revenue-in other words, there has been a deficit. It seems that this year the argument is about the amount of the deficit. One must be realistic about the progress of economies. What ever might be said about certain deficiencies at the moment, no one is denying that inflation does exist. No one is denying that there is a degree of unemployment. Nevertheless, in the Australian economy today, on the basis of the figures for the last complete quarters as against the previous 12 months, the physical output is greater than it was.

The problem with the economy now is, as it has always been, in sharing the scarce resources of skilled manpower and materials and technical skills among a variety of alternative uses. There are still more things which need to be done in the Australian economy, both at the public and the private level, than we have the resources to encompass. The difference between this Government and the previous government is that they have a different basis of priorities. In the long run, Government, in the name of the people, is concerned with the allocation of resources between alternative uses. The great bleat at the moment is that the level of the deficit is chosen to suit the convenience of those who want to use it. It is dishonest to suggest that at the end of, March, which is the date of the last Treasury’ monthly statement published, the difference between expenditures and receipts was of the order of over $3 billion.

Everybody knows these 2 things: Expenditure on the part of government goes on fairly evenly month by month, but revenue does not come in equally month by month. The great phrase which is being used so glibly at the moment is: ‘Resort to the printing press’. As I told one of my colleagues yesterday, there will be a great unprinting of money, if that is the term that ought to be used, in the next two to three months as large company taxation payments of about $ 1 billion are made. That will reduce the astronomical deficit figure, which seems at the moment to have so much appeal and to paralyse thinking on the situation, from about $3 billion to about $2 billion. If a deficit of $3 billion at this point is supposed to be some great devastation, is the reduction of that deficit by $1 billion in the next 3 months a sign of achievement? Is that the level of analysis which is taking place in this House about the Australian economy?

I wish to look at one or two aspects of the Australian economy which ought to disturb us all. It is nice when one is in opposition to be able to put all the blame on the government. From the remarks during a debate yesterday I almost thought that the Australian Government had deliberately knocked down the Tasman Bridge. There were remarks of a similar vein in the debate about Darwin this morning. These are things which happen. They are beyond our control, but we endeavour to remedy the situations when they occur. Part of the very large deficit which is being talked about has been occasioned by the extension to the wool industry by the Government of more than $300m. This enabled wool growers to have incomes. They would not have had incomes if they had to wait for the wool to be sold. I am sure that no member of the Australian Country Party objects to what was done with regard to the financing of the wool industry. But doing this has added to the deficit which honourable members opposite have elevated to a kind of symbol of incompetency of this Government.

The great difficulty in the Australian economy at the moment is in deciding the shares of the total productive capacity that will go between wages and profits on the one side and private and public expenditure on the other. The two are interrelated. It is no easier to decide in an abstract sort of way what is a fair day’s pay for what is described as a fair day’s work than it is to decide what is a reasonable rate of return on capital employed in a business. The great danger in either case when they are put in abstract terms is that it makes an agglomerate of what really is a very diverse situation. There are variations in industry in Australia, from small scale individual enterprises to partnerships, private companies and public companies. Increasingly, the sorts of investment decisions which have to be made involve greater magnitudes than ever before. The source of the capital financing in a large part is the use of depreciation reserves, which are tax deductible, and undistributed profits. To a lesser extent the re-financing or the expansion of industry is financed from new capital subscribed by shareholders.

Whereas in other days the magnitudes of the new capital expansion were perhaps of a few million dollars, they now tend to be of the order of hundreds of millions of dollars, and even billions of dollars. The decisions which are made have to be made long in advance of the completion of a project. Something which today would cost a certain amount could, within 2, 3, 4 or 5 years cost a vastly different amount. These are the sorts of things which in a vague kind of way are being talked about now when it is suggested that we should have different approaches to accounting because of inflation. As usual, those in business are sometimes a bit more vocal than are other sections about what their deficiencies are. Economists ought to tell honourable members opposite that inflation does not affect only company profits, the return on capital or capital expansion, it affects everyone in the community. Various devices are sought to protect particular sections against inflation. Once one tries to protect everybody simultaneously against inflation one gets into some curious situations. Wage indexation is one attempt on the part of wage earners to maintain their standards without having to bargain annually for their income to be changed.

Indexation of savings is sometimes talked about. It is said that people really do not get a net return on their money if they put it in the bank at an interest rate of 10 per cent per annum and the annual rate of inflation is 1 1 per cent; that they really have a negative return. Of course, what sometimes is not asked is what would happen if the money had been left under the bed with the possibility of its being stolen. It certainly would have produced no return. Sometimes a compromise has to be made, and the best situation that is available has to be accepted. But there is not any doubt that if one were to assume that, say 3 years ago, wage levels were at a certain percentage of the Gross Domestic Product and returns on company profits were at a certain percentage of Gross Domestic Product- and one might argue as to whether at that point of time 3 or 4 years ago there was an equitable distribution between the two- and were to compare that with the situation that exists now, the increase in wage levels has been far greater than that of profits. This seems to me to be the type of point that we ought to be centering on in this debate.

I said in the days when I was Treasurer, prior to shifting to the portfolio of Overseas Trade, that Australia had reached a point where- and I do not deny that as far as the present economy is concerned approximately three-quarters of total employment is still in what is rather vaguely described as the private enterprise part of the economy and one-quarter in the public sector- if there is any lack of confidence in the private sector, it becomes very difficult to absorb into useful employment all those who want to be absorbed. In Australia more jobs have to be found every year than existed at the beginning of the year because there are something like 200 000 new potential wage earners each year, minus those who retire from the work force. At the end of December 1974 some 6000 fewer people, in total, were employed in Australia than were employed at the end of December 1973. It should not be forgotten, nevertheless, that at December 1973 total employment figures were greater than they had been ever before but in the following 12 months not all those who wanted to come on to the work force were absorbed.

The work force is a changing situation. We have the irony, one could say, at the moment of more people unemployed than any honourable member on either side of the House would like, but simultaneously with that various areas of industry are indicating that they cannot get employees in particular areas. What this points to is some sort of structural difficulties within the economy. I am afraid that in Australia, as in so many other countries, because we have been so concerned about problems like unemployment and inflation and have tended to look at the issues separately, we have not comprehended the kinds of changes that probably will have to be made in Australia and in other parts of the world in the next 10 years.

In my new portfolio of Minister for Overseas Trade perhaps, to some extent, I get a different perspective from what I would get when looking at things merely locally. Australia does happen to be one of the largest trading nations in the world. When one conceives of international trade as the sum of exports and imports in relation to total GDP, Australia’s figure exceeds 25 per cent of GDP. We now export something like $8 billion worth of goods and services every year and our imports cost a somewhat lesser sum. We have to pay for invisibles, which makes our balance not quite so easy and to some extent we rely on capital inflow. But, by and large, no country exports at all unless it wants to import. After all, it would be silly to send out of Australia more than we brought into it. We would be subsidising some other part of the world if we did so. But at least we have to try to preserve some sort of balance. International trade is a two-way process. Honourable members from Queensland, for instance, cannot expect to sell from their State beef and coal- it is not a question of beef or coal; it is beef and coal- to Japan if we do not buy from them something else to pay for the beef and the coal.

One of the great difficulties in Australia is that those who happen to be the exporting interests are entirely different from those who are the importing interests. One of my tasks is to try to reconcile the two. I find, for instance, that when, for good and sufficient reasons, my colleague the Minister for Manufacturing Industry (Senator James McClelland) takes certain steps to protect an Australian industry- be it footwear or textiles or something else- and puts limitations upon the access of those items to Australia, I receive very learned documents called aide-memoires or General Agreement on Tariffs and Trade observations telling me that Australia is in breach of some contractual arrangement by doing so. I simply mention that point to indicate that there does have to be a bit of give and take and sensible reconciliation in the process of our trade, external as well as internal.

I have always been an optimist about the future of the Australian economy and I think that that optimism will be borne out only if there is sensible co-operation between government, private industry and employees and sensible decisions are made as to what should be the disposition between total resources going to public and private sectors. I think this is what our task continuingly is going to be. However, so often I find that somebody plucks a figure out of the air. After all, what is $2 billion in relation to a GDP that will be running at a figure of near enough to $60 billion by 30 June, when we will have to appraise it. The significance of an amount of money can only be evaluated in terms of whether it has assisted to bring into active use resources that otherwise would have been idle; whether it has somehow altered the disposition of resources between the public and private sectors; and, if it has, whether it has altered them for the better. I think that in terms of those assessments the conduct of this Government is not as recreant as some people try to make us believe. There are problems ahead. The problem of inflation is the most difficult and the other problem that is difficult is getting a return of confidence on the part of those who are supposed to make investment decisions in the private sector of the economy.


-This debate draws together four Bills- two Appropriation Bills and two Supply Bills. It is a very significant and important debate for the economic wellbeing of the country. The Appropriation Bills will authorise increased expenditure by way of additional estimates for this financial year. They tell their own story of the economy and Government policy. As such, they are not mere mechanical Bills. The Supply Bills authorise expenditure of money next financial year- that is, as from 1 July 1975- on the basis of expenditure in the past year plus increases in wages since 1 April 1975. The amount of the expenditure is limited to 30 November 1975. The Bills give legislative approval to the Government’s fiscal policies, they do not give legislative approval to the Government’s monetary policies; but for economic management fiscal and monetary policies are not separable in the ultimate result. These policies and the Government’s other associated economic policies are of vital significance for every citizen in this country.

In the first 9 months of 1974-75 the Government spent $3,300m more than it received in revenue. For the financial year ending 30 June 1975 it is expected that the deficit will be between $2.2 billion and $2.5 billion. The Government has expanded expenditure by more than 40 per cent over last year. Compare this increase with 1972-73 when the increase in Government expenditure was 12 per cent and in 1973-74 when there was an increase of 20 per cent. This financial year there will be an increase in Government spending of 40 per cent. This shortfall of money- that is, expenditure will exceed revenue- is a debt; it is a deficit and it is being financed by creating Treasury notes and printing money. The debt is paid by everybody. Let nobody suppose that the debt is just created and that it somehow wafts away. It is paid by everybody. The value of money now held falls. The relative value of most assets falls. It is true that some people can look at an asset and say that it has increased in value, but if they realise it and try to buy a comparable asset they will find that the price has risen and there has been a relative fall in their assets. Most people suffer.

During this period average weekly earnings have exceeded price increases and therefore there has not been an awareness among the general public of the evils of the inflation we are suffering, but this will change. The Minister for Overseas Trade (Mr Crean) made this point a short while ago: Profits have declined while wages have taken a bigger share. He recognises that this must change for the private sector to be restored to full activity. When that happens prices will rise higher than average weekly earnings have risen and that is when the people of Australia really will understand the evils of inflation.

The money supply since October last year has grown at an annual rate approaching 25 per cent. This is the reverse of a credit squeeze. It is stuffing money into an economy unable to use it. This followed the economic madness of the credit squeeze of the preceding 13 months. During that mad period the money supply actually was reduced while costs were rising at more than 20 per cent a year. The last 2 years can only be called the mad era. Now the national task is to prevent our moving into a sadistic era. The two most serious problems are inflation and unemployment. Other problems such as lack of growth m the economy, poor productivity and little investment are mere consequences. The Treasurer (Dr J. F. Cairns) has shown that he believes there is some trade-off between inflation and unemployment. How wrong he is. Experience shows that as inflation has increased in Western economies unemployment has increased. Britain, the United States of America and West Germany are only 3 examples of that.

The Treasurer, by ignoring inflation in his attempt to tackle unemployment, actually is building a worse unemployment crisis in 1976. The present excessive growth of money will affect the economy not this month but late in 1975 and in 1976. This is because of the lag effect. The credit squeeze was most intense in the June quarter of 1974 but maximum impact on employment was not until January, February and March of this year. The Treasurer said that deficit budgeting financed by money creation would end only when unemployment eases, but we have the crisis of greater unemployment facing us in 1976. By the time he accomplishes that it will be too late to prevent the resulting inflation and the subsequent recession that will come again. The longer the Government delays, the more severe the pain, and the more difficult and drawn out will be the cure. My great fear is that in 1976 we will look back to 1975 and say that 1975 was not so bad. If we get to that point we will have failed as a nation and the Government will have failed the people of the nation.

There are 4 ways to bring monetary growth to manageable levels. I shall set them out. The first is to reduce the deficit by raising taxes; that is to increase costs and prices and destroy incentive. Everybody in this country knows how much taxes have risen and how destructive that course of action would be, so I dismiss it. Secondly, to bring about manageable levels of monetary growth, we could finance the deficit by borrowing, but if we did that we would push up interest rates and impose a liquidity drain on the private sector- the sector which is presently suffering so much and where the unemployment exists. Without any ill will to any public servant, for I admire the job he does, I ask this question: When did yon last meet a retrenched public servant? The unemployment is in the private sector, and it is the private sector that must recover. So I dismiss that course of action. The third course of action is to run up a large balance of payments deficit by revaluing the currency. That would further cripple domestic industry with a flood of imports and create even more unemployment. For that reason I dismiss that course.

That brings us to the fourth course, and that is to reduce the deficit by cutting the rate of growth of Government spending. It is only this fourth choice which is acceptable in Australia today. Any of the other three would destroy the basic economy. I accept this fourth course unequivocally and unqualifiedly, and I urge the Government to do so. Most importantly, the people of Australia must understand it and accept it. As a matter of national purpose every member of this House and of the Senate must argue for this restraint in Government spending. The expenditure economies must be right across the board. We have heard talk of inflation in Australia being imported and of the position here being no different from that in other countries. That has all been discredited. There is only one single strand that runs common to the inflation of all the Western countries and that is that governments are meeting popular demands and expectations beyond the capacity of the economy to pay. The Governments do this in order to retain office or to gain office. Until governments have the courage to say: ‘The expectation is beyond capacity; we will not do it’, we will continue to have irresponsible governments and the common strand will continue to run.

Let me make this absolutely clear. The cuts I have spoken of include the big spending but political sensitive areas of education, health, urban and regional development, and social security. I would exclude only pensions from the economies. Every Minister should be instructed by the Government to cut his budget, even to cut his hopes, and to set his priorities for spending. The Prime Minister (Mr Whitlam) should say to the people of Australia: ‘This program will be deferred in the national interest’. He should name the series of programs to be deferred. As I have put it, as the Prime Minister and the Leader of this nation he should say: ‘This program will be deferred in the national interest; we will undertake it when we can afford to pay for it’. No community can have more than that community can itself build and pay for. Until we have that clearly in our minds and act according to it we will continue to put in jeopardy those people in this country least able to withstand the effects and harm of inflation. I for one am not prepared to be silent when I see that great range of people who have spent their working life paying into superannuation funds expecting to maintain their standard of living in retirement only to find that their standard of living falls away from them and their years of work are as of nothing. Action should be taken now. It is clear that the 1975-76 Budget will be crucial to turning the corner. I deliberately use the term ‘turning the corner’ because we are in so deep in an economic morass that one Budget cannot cure it. But the next Budget must set the right direction. It must commence the fight for economic sanity.

The Government has built up expectations in many expenditure areas- health schemes, national compensation, urban development, national superannuation and so on. But it has shown no ability to resist the interest groups and the pressure that interest groups can bring to bear at the expense of the taxpayer. I believe that the Government must now, at this initial planning stage of the 1975-76 Budget, determine a rigid expenditure ceiling. The private sector must be allowed to recover. Taxes must be further cut. I believe, therefore, that there will be little scope for any real increase in Government spending next year.

Assuming a 15 per cent inflation rate for the year as a whole- that is from 1 January 1975 to 30 June 1976- on the basis of the policy changes which I am now recommending, I believe that Commonwealth Government spending will have to be limited to a 15 per cent increase in the next Budget. This will allow a significant tax cut and a responsible result in terms of the deficit. In relation to tax, let me remind the House that in the 1972-73 financial year- not yet 2 years agorevenue was $9,5 1 8m. By the end of 30 June this year- 2 years later- it is expected to be $ 15,000m, notwithstanding the tax cuts which the Government introduced after very strong arguments for that course of action which I am proud to say I initiated. Personal tax in 1972-73 amounted to $4,089m. For this year it will be nearly $8,000m. What will it be in 1975-76 unless we have more tax cuts? Where will incentive for people be if they work overtime or get a promotion and the .increased payment is absorbed by increased tax payments?

Ideally the process should begin immediately. I believe that monetary growth should be cut immediately to 15 per cent and subsequently brought down to around 10 per cent annual growth. Combined with more responsible action to contain wages, as set out in the Opposition’s economic policy published in February last, these measures would eventually bring down inflation. But no one can pretend that bringing down inflation is going to be a quick and easy course. It will be neither quick nor will it be easy and it will require courage from government and courage from the Australian people in accepting it, for they know that if they accept it, it will build their future but if they do not accept it it will lead only to the downturn of the very political and economic institutions of this country.

With inflation reduced and a more stable environment for economic decision making restored there could be a return to genuine full employment. The proposals which the Opposition has put forward for a flexible exchange rate would enable these results to be achieved in Australia whatever were the conditions in the rest of the world. That we must do. It is no point arguing that our inflation is caused by other countries. We have the power, the wit and the wisdom to take the necessary action so that we can advance in Australia and not be subject to the sheer economic chance of the actions of other countries.

The experience of the last 2 years and the Treasurer’s statements of this week indicate that the policies needed to restore economic stability in Australia are not likely. The Government must change its policies. It must not be caught up in ideology, in outdated economics, in foolish personal pride or in internal competition for influence and power within the Government and the Cabinet. The Treasurer, who was until recently the Minister for Overseas Trade, in commencing this debate said that the Opposition was trying to argue that deficits are bad and that surpluses are good. We do not argue that. It is perfectly clear that fiscal policies must be set and supplemented by monetary policies. If the state of the economy requires fiscal expansion, deficits are good; if the state of the economy requires restraint, deficits are bad. When deficits rise to the proportions they are in Australia today simply because of a lack of understanding or a lack of will on the part of the Government, the Government is doing an essential harm to this country which can take years, and perhaps even decades, to recover from. So the responsibility of the Government is just not measured in terms of today or next month. The responsibility is measured for the rest of this decade as a certainty and probably into the next decade.

I believe that this country needs the return of a Liberal-Country Party government at the next election. I do not want the country to be ruined while we wait for that election. For those reasons I implore the Government to change its policies. There is no need for this situation. The Government should make it clear to the Australian people that it is activated and motivated by their interests and from responsibility in government so that when the next election comes, which I will do all in my power to see we win, we will not be haggling over the carcass of an economy which has been stripped of its muscle and flesh. What we will be doing is arguing a debate on the electoral hustings about which party will better be able to serve the interests of the Australian people and make our economy as great as it ought to be.

No country has a right to greater expectations than Australia. The resources that we have under and on the ground combined with the people we have confirms that view. But there is no other country of the Western world or member country of the Organisation for Economic Co-operation and Development which at present would have greater fears as to the realisation of those expectations. The time has come for the Government to take the appropriate actions and not be buffetted by ideology or lack of will to resist pressure groups which are interested only in the expenditure of money to satisfy their particular wants without regard to the capacity of the community to pay and of the economy to deliver up that money without lasting and permanent damage.

Mr Clyde Cameron:

– I think we are indebted to the right honourable member for Bruce (Mr Snedden), who has just resumed his seat for giving us for the first time a glimpse of what the country can expect from a change of government. Although the Deputy Leader of the Opposition (Mr Lynch), the Leader of the Opposition (Mr Malcolm Fraser) and other spokesmen for the Opposition have constantly said that the cure for inflation and social ills that seem to have taken over the whole of the Western economies lies in reduced government expenditure, none of them before has ever told us the precise nature of the reduction in Government expenditure which a LiberalCountry Party government would bring about.

Thanks to the right honourable member for Bruce we now know that a Liberal-Country Party government would reduce all areas of government expenditure except the area of pension entitlements.

The fact that honourable member after honourable member- some of whom are leaving the chamber- congratulated the right honourable gentleman on his speech and his candour indicates clearly that the words that he spoke do in fact represent more clearly the views of the Opposition parties than does the ambiguity of the Leader of the Opposition and the Deputy Leader of the Opposition.

Mr Giles:

– What nonsense !

Mr Clyde Cameron:

– It is not nonsense at all.

Mr Giles:

– The Minister did not listen.

Mr Clyde Cameron:

– I did listen. The right honourable gentleman shows by his attitude that he speaks more accurately for the Opposition Parties on the questions of what areas of Government expenditure will be affected by the Liberal and Country Parties’ policy than does the Leader of the Opposition and the Deputy Leader of the Opposition. The fact that the honourable member for Angas (Mr Giles) does not reply to that statement indicates that he acquiesces in what I have just said. So we know now that everybody who has benefited from the Government’s programs, which have entailed increased Government expenditure, will be made to suffer when a Liberal-Country Party Government is elected. They will be made to pay the price of dealing with inflation and unemployment because of the way in which a LiberalCountry Party Government will deal with it.

I would like the Leader of the Opposition to say categorically whether he will cut the age pension. I do not mean in terms of monetary value; I mean its percentage ratio to average weekly earnings. Will he cut the invalid pension? Will he give a categorical undertaking that he will not cut the percentage which the widows pension now represents in relation to average weekly earnings? Will he give us a categorical denial that a Liberal-Country Party Government will not drastically reduce the real value of unemployment benefits. In relation to this point, I remind the House that many spokesmen on the Opposition side of the House have repeatedly condemned the level of unemployment benefits as being, to their idea, far too high. Let the Leader of the Opposition deny, categorically if he will, that the real value of repatriation benefits will remain untouched. Let him give a categorical denial that he will continue to give to the poorer schools- that is, the State schools and the poor parish schools- the same level of educational assistance as they now get. Let him deny that it is his intention when his Party is elected to government to reintroduce the payola to the category A schools which represent the class for which he stands. Let him deny that, if he will.

Let him deny that he intends to scrap Medibank. Let him deny that if he will. Let him go further than merely remaining silent. Let him stand up and say where he stands in relation to Medibank. Let him tell the House whether he intends to continue the National Apprenticeship Assistance scheme which according to the latest figures this year- to the end of Februaryalthough there is an economic downturn, has brought into the work force a higher apprenticeship intake than has ever been seen before, even including the record year of 1973-74 when 43 000 apprentices were brought into the work force as against the previous total of 3 1 000. Let him give a categorical undertaking that he will not cut the subsidies which this Government is giving to employers in order to encourage them to employ apprentices. Let him say where he stands in relation to the Regional Employment Development scheme. This scheme has already found employment for 14 000 employees. It is finding increased employment week by week as it begins to get off the ground. Let the Leader of the Opposition say where he stands on the RED scheme which has the full support of all sides of the Parliament.

Let him tell us clearly what he intends to do about the National Employment and Training scheme. Will he use NEAT as an avenue for reducing Government expenditure? If he intends to do that he will deprive this country of the most forward looking national employment and training scheme which it has ever had. Indeed, it is the most forward looking, comprehensive training scheme of any country. Will the Leader of the Opposition cut that scheme? Let him stand up and be counted on that. Does he intend to continue to spend the money so badly needed to make suburban life more liveable than it is now? What is his policy in relation to urban and regional development? Will he buy up cheap land or broad acres in order to make cheap land available to working people at a reasonable cost per block? Or does he intend to cut that too?

Where does the Leader of the Opposition stand in relation to the Aboriginal question? Does he intend to cut the program of spending upon which we have embarked? What will he do about housing? Will he reduce the present program upon which we have embarked for homes for the aged, for war service homes, for rental homes and for finance to make it possible for people to buy their own homes at reasonable rates of interest? Will that be one of the areas on which he will chop down?

Does the Leader of the Opposition intend to continue to assist the wool industry which is already getting $350m assistance a year from the taxpayer? I suggest that that will be one area which he will not cut. If anything, we can be quite certain that the wool barons will be guaranteed an increase in the amount which has already been given to them. He is not likely to decrease the amount paid to rural organisations. Under another Liberal-Country Party Government the Country Party will continue to be the tail which will wag the Liberal dog. Every Liberal Prime Minister that Australia has ever had has been a captive of the little rump which sits across on the corner benches. Every Liberal Party Prime Minister has been forced to carry out policies in which he did not believe in order to play safe with the Country Party rump which always threatens to throw the Liberal Party out of office. Does a Liberal-Country Party Government intend to reduce expenditure on the immigration program?

I say that the election of the present Leader of the Opposition has polarised the electorate in Australia in a way which has never previously been seen in the history of our country. Never before have the people of this country seen such a political polarisation as we now have. I say that when the electors go to the polls at the next electionwith the present rich, wealthy and arrogant Leader of the Opposition- to decide whether they will elect a new Government they have to ask themselves some questions. If they can answer yes to the questions they will vote for the Liberal Party and the Australian Country Party led by the honourable member for Wannon. If they have inherited a $lm pastoral property; if they can say that in addition they were educated at the Melbourne Grammar School and that they finished off at Oxford University; if in addition to that they can say that they have never lived in a city in their lives; if in addition to that they can say that they have never worked in an industry in their lives; if in addition they can say that they have never been bona fide members of a trade union; if they believe in giving category A schools rich handouts as the honourable member gave when he was previously in office; if they believe in savage strike penalties against workers who are trying to get what the market will yield for the goods which they sell in the same way as the seller of commodities goes to the market and extracts the maximum that the market will yield; if they oppose wage indexation; if they believe in allowing foreign investors being permitted to own and control our priceless mineral resources as well as our industrial potential; and if the electorate in addition to all this knows that this person wants to make the rich richer and the poor poorer, then and only then will the electorate vote for the political Parties represented by the present Leader of the Opposition.

The Liberal Party and the Australian Country Party are the parties of privilege. They are the parties that represent the very rich, the warmongers, the large employers, the foreign investors, the cartels, the rich oil monopolies. Members of the Country Party are smiling over there at the thought of receiving another donation from the oil industry for the next election campaign. They know perfectly well that they are committed to a policy, if they are elected, that will guarantee an increase in the price of crude oil, that will put up the price of petrol to $ 1 a gallon for every motorist, whether he be rich, poor, or middle class. That is the policy to which the Country Party is pledged. That is the policy that it will impose upon the Leader of the Opposition if ever he should become the Prime Minister of this country. Whether he likes it or not, that is the policy that Australia can expect.

They are the parties that represent the spivs and the racketeers in the stock exchange industry. They must be the representatives of the spivs and the racketeers in the stock exchange industry; how else can one explain the Opposition parties ‘ refusal to allow the Senate to pass the Corporations and Securities Industry Bill which would have given some control over the spivs and- I repeat it- the racketeers in the stock exchange industry. They are the parties that represent profiteers. They do not mind the sellers of goods making a profit from what they can extract from the market, but they object to the sellers of labour using the same means of determining the value of what they sell. The Liberal and Country Parties have absolutely no sympathy for and no interest in the working people, in the poor, in the aged, in the under-privileged, or in the buyers of petrol because their policies will increase the price of petrol. They have absolutely no interest in the children who attend the poor State schools and the poor parish schools. All they are concerned about are the wealthy pastoralists, the people who have inherited large fortunes, the rich, the privileged and the people who are able to exploit their monopoly position in the country.

If the Leader of the Opposition ever becomes the Prime Minister of this country his policies will result in rising unemployment. That is a policy in which the Liberal and Country Parties believe. They deliberately bring about unemployment whenever they can. They believe in high unemployment. Now they have the audacity to pretend that they are opposed to high unemployment.

Mr McMahon:

– We are. You are not, obviously.

Mr Clyde Cameron:

– The Opposition parties are in favour of high unemployment because when they were in Government before and when the right honourable gentleman was the Prime Minister his Treasurer boasted on 23 January 1972 that the objectives that the then Government had sought to bring aboutnamely, high unemployment- had been achieved. Unemployment is high under the present Government, but unemployment is high throughout the western world at the moment. It is not because of any deliberate design on the part of this Government, because no government has done more to try to swim against the tide of western economies and to bring down the level of unemployment than has the present Government.

If the unhappy day ever arrives when we have a government led by the present proud, rich and privileged Leader of the Opposition, then we can expect rising unemployment, rising interest rates, wage reductions, as well as the abolition of Medibank, lower pensions, lower unemployment benefits, increased industrial unrest and a sell out of Australia’s natural and industrial resources to foreigners, and if ever there is another war like Vietnam, Australia W111 be thrust into it again. Who is responsible for Australia’s involvement in the Vietnam war? The present Leader of the Opposition was the Minister for Defence at the time, and he is the guilty man responsible.

If he did not believe in the Vietnam war and he had just an ounce of principle, he would have resigned from the Government which was responsible for sending so many hundreds of people to their death in Vietnam. Did he care? No; in his arrogant aloofness he did not care one bit. It did not worry him that hundreds of thousands of civilians were being slaughtered in Vietnam. It did not worry the present Leader of the Opposition that people were burned to death with napalm. It did not worry him that young Australians were sent to Vietnam, maimed for life or killed in a useless war that has now been proven to be the invention of the Pentagon in the United States. It did not worry the present Leader of the Opposition at that time. He wanted to keep his job as Minister for Defence more than he wanted to comply with his conscience or those principles, if he had any, which conflicted or violated against this useless wastage of manpower and material. He is the guilty man. He is the man who wants Australia once again to repose its faith in his guilty, bloody hands.

If the electorate should vote for a government led by the honourable member for Wannon it will vote for a government that really believes in unemployment rather than the present Government which is in favour of full employment. Let me illustrate to the House what this Government has done against great odds and against great opposition from the Opposition parties. We have provided employment for 1 1 666 people under the National Employment and Training scheme. Another 14 951 people are employed under the Regional Employment Development scheme. The intake for apprentices under the National Apprenticeship Assistance scheme will exceed 40 000 if the present rate is continued, and the income maintenance scheme is providing full wages for 8809 of them. In the last month only- in 4 weeks- the number of people receiving the unemployment benefit dropped by no less than 31 000.

Mr Kevin Cairns:

– How many are on the dole?

Mr Clyde Cameron:

-There are 150 000 as against 180 000, a drop of 31 000. They were the figures as at the end of March of this year. This Government is asked by people like the honourable gentleman who just interjected why it does not do unpopular things. At the same time the Leader of the Opposition says that if ever we do anything unpopular we are going to be faced with a snap election and that we will not be given the chance to complete our 3 year term. He says: ‘We are going to wait until we catch you with your pants down’. Whatever he intends to do to us then, I do not know. But he says that he is waiting to catch us with our pants down. Then he says: “The only guarantee we will give you is that we will not call for an election unless there are special circumstances’, whatever that means. He never defines the term ‘special circumstances’, but obviously the special circumstances will be the circumstances which create a state of temporary unpopularity which will make it profitable for the Opposition once again to misuse its power in the Senate to refuse the elected Government the money needed to govern.


-The Labor Government’s printing presses continue to turn out its spurious dollar bills at an increasingly headlong pace, careless of the impact on national economic management, careless of its effect on the taxpayers of this country, careless of its inflationary effects and careless of its effect on employment, industrial relations, business efficiency- even business survival- and on confidence. In many cases it does so with a degree of gloating because private enterprise and business is getting a bashing, profits are falling and management, particularly of small and medium sized businesses, cannot take the risk of investing in expansion projects. The April round-up of economic statistics indicates that private gross capital expenditure fell by 7.7 per cent in the December quarter. The fall over the year was 13 per cent or a little more.

We are now considering, amongst others, Supply Bill (No. 1) and Supply Bill (No. 2) which the Treasurer (Dr J. F. Cairns) told us, almost with indifference bordering on licentiousness, seek approval for interim appropriations for 5 months from 1 July 1975-$2,692m for the ordinary annual services of government and $ 1,082m for capital works and services and payments to or for the States. I want to concentrate on them. That is all we seem to be told about what the Bills contain and what they are supposed to do. We are lucky to get that amount of information- a few desultory comments about which departments are to spend the money, and absolutely no more. There is not one word about the impact of these vast increases on the destruction of the value of the Australian dollar, its effect on the cost structure of Australian industry and commerce or its effect through inflation on unemployment or on the money supply.

There can be no doubt in anyone’s mind that the growth in the money supply under the Australian Labor Party Government is one of the three major smothering influences on the sources or causes of our national economic growth and development, inflation and unemployment, business bankruptcies, the loss of confidence by the business community and the general disenchantment with Labor’s policies and actions.

Before analysing these two huge amounts totalling $3774m for 1975-76 let me say something about Government deficits- that is, the deficiency between Government revenues and taxation, and expenditure. There are three main causes of the changes in the money supply: The rise or fall in our overseas money balances and international credits, the extent to which the trading banks create money, and Government deficits or surpluses in taxation receipts and expenditure such as those covered by the 2 Bills we are now debating. Neither the rises nor falls of our overseas balances or trading bank lending are significant today. It is the Government’s operations through deficit financing in Supply Bills Nos. 1 and 2 that are significant.

The Treasurer wanted us to believe that the present deficit in our money accounts this year is now $3,300m and that by the end of this financial year, because of taxation payments from now on, we will have a total deficit of about $2,300m.

I do not know any person of authority with a glimmering of responsibility and honesty who argues that this level is tolerable for long. It must inevitably be damaging and within the next financial year, 1975-76, must cause worse inflation and higher unemployment. It must hurt all of us except the quick of mind, the money brokers and the other odds and ends in the nonproductive section of the community.

In the Supply Bills introduced in 1974 to cover the first 5 months of 1974-75 it was estimated that the equivalent deficits for the first 5 months of that financial year would be $ 1,804m for ordinary expenses and $535m for capital expenditure, making a total of $2,339m. Next year, as I have said, for the same 5 months of 1975-76 they are estimated to be $2,692m for ordinary expenditurean increase of 50 per cent or $888m- and $ 1,082m for capital expenditure- an increase of about 1 1 1 per cent or $547m. This will not help John Citizen, his wife and family. It will not help the small entrepreneur or businessman. It will not help the saver who invests in government bonds, life assurance or superannuation or who invests in our development. It will hurt all of them. That is saying enough. Maybe, as some commentators suggest, we will be able to put up with the sort of deficit I first mentioned for one year, with difficulty. No one suggests that even we in this incredibly lucky country can succeed twice. No other country ever has. Yet the Treasurer obviously thinks we can.

Even taking Dr Jim’s prescription of a deficiency of 2300 gallons of counterfeit dollars this year we can expect a deficit of at least 55 per cent to 60 per cent greater next year. That is a deficit of about $3,500m to $3,600m in 1975-76 as a whole. What else can we say about these Bills other than that they have been presented in a haphazard and slovenly way? I think that there are more than two conflicting theories in the Government about the effects of rises or falls in the money supply. Let us analyse the details of the Bills a bit more carefully in order to ascertain their effect and incidence. First of all, let us take the inevitable consequence of the vast increases in the money supply for this financial year and next. It is inevitable that large increases in the money supply not balanced by increased production or productivity or improved standards of service must increase inflationary pressures because in these circumstances the increased amount of money, except to the extent that it is saved, must push up the cost of goods and their prices in the market place. It is the old adage come true of too much money chasing too few goods, together equalling more inflation and unemployment.

Let us go a bit deeper with the analysis. If one looks at the details of Supply Bill (No. 1 ) one will see that amounts spent by the Labor Government will be mainly for increased payments for salaries and administrative expenses. Very little, if any, is directed towards increasing production or productivity. It is a net addition to spending potential without equivalent production or productivity. It must be inflationary. Supply Bill (No. 2) provides $ 1,082m for capital worksthat is, for buildings and equipment. Except for such matters as buildings for educational purposes it is largely for Government purposes. A great deal of it is for the growing bureaucracy and the non-productive section of the community. This also is inflationary. Under these circumstances increased inflation is not so much a possibility as a certainty. Inflation of massive proportions must lead to substantially increased unemployment and business failures.

The money supply should increase at about the same rate as gross national product in real terms plus a partial allowance for inflation. A 10 per cent per annum increase in the money supply is as far as we should go unless there are exceptional circumstances and the economy is slow in reacting to budget and monetary stimuli, as happened in late 1971 and early 1972. Increases of as high as 10 per cent should be temporary. I should also point out that the circumstances of 1974 and 1975 are totally different from what we have ever known before.

The Treasurer argued in one breath on Tuesday that the growth in the money supply in 1 972, when we were in Government, was the cause of the level of unemployment at 27 1 000 2 years later. In the next gasp he said that Labor continued increasing the money supply throughout the July quarter of 1973, after we went out of Government, with an increase of 27 per cent, in the September quarter with an increase of 23 per cent, in the December quarter with an increase of 12 per cent, in the March 1974 quarter with an increase of 12 per cent, and in the June quarter with an increase of 9 per cent. There were 18 months of excesses since we were in Government and when the economy was healthy and growing at a rapid rate, and the so-called Treasurer of this country still wants to blame someone else. Come off it, Jim. The public are not so gullible. Stop being infatuated with your own propaganda and come up with the truth and the right explanation of causes and cures. Unless you do this, unless it is done, you will make the future even worse than it will inevitably be with your present policies.

Let us get to the truth. Labor inherited a prosperous and fully employed economy on 2 December 1972. The facts are clear and indisputable: In December 1972 national growth was good, inflation was down to 4.6 per cent and trending lower, unemployment was low in seasonal terms and getting progressively better, and the economy was healthy. The Treasury Round-up of Economic Statisitics for the December 1972 quarter showed: ‘The available indicators point to strengthening in demand in major areas of demand in the economy over recent months. ‘

The March 1973 quarter was the time for restraint, but not before. But what happened? As Treasury Bulletin No. 69 of 1 973 pointed out, the economy became swamped with money early in 1973. Labor Government expenditure ran riot under the blurred vision of Mr Crean and his desire to divert resources from the private to the public sector on a major scale. Business bashing became the order of the day. As early as January 1973 the Treasury Bulletin, commenting on Labor extravagance, stated:

As stated earlier, the net result of these revisions (of Labor policy) is that the 1972-73 Budget is estimated to result in an overall deficit of $958m or $328m above the estimate in the Budget ofl972-73.

That was the beginning and was the first cause of our present predicament. Labor has continued its policy of deficit financing, with one break, and will continue it under these two Bills. The Treasurer’s arguments are based on a falsification of known facts. His Government’s actions are the reasons for our present problems, and he is incapable of solving them because of the idiosyncracies of the Labor Party Cabinet and Caucus. Labor must take the blame. The Treasurer’s credibility has been tested. His integrity on economic and financial matters is under scrutiny and, on the evidence to date, he has been found to be wanting. Incidentally, he forgot the truth when he said on Tuesday that no action was taken by the McMahon Government in 1972 to regulate overseas capital inflow. In fact, action was taken in 1972 to impose the 2- years-and-a-day rule to exclude short term borrowing overseas and preparatory action had been taken to impose a special variable deposit of 25 per cent on overseas borrowings- a policy, by the way, adopted by the Labor Party. I personally brought down a foreign takeovers Bill to control the activities of foreign corporations with ambitions to expand here.

As I have said, Dr Jim, who wants to be liked by everyone, is on the same track as his predecessor, the unfortunate Mr Crean. Those of us who carefully watched the disgusted, even anguished expression on the face of the Prime Minister (Mr Whitlam) on Tuesday when Dr Cairns answered a question put by the Deputy Leader of the Opposition (Mr Lynch) relating to the money supply, sensed that Dr Jim is following the same road to the political slaughterhouse as Messrs Crean and Murphy and my good friend Mr Cope.

Let us put the problem in a wider national context. The Government has not developed an effective, coherent and comprehensive fiscal monetary and wages policy in order to overcome our present dilemmas, let alone the inevitable worsening trends towards depression after the March quarter of 1975-76. But it can be said of the Prime Minister and some of his special advisers that they are thinking about the three other major related economic and industrial problems. We must try to find answers to them, along with controlling the money supply. The first problem is wages. Dr Jim admits- for once agreeing with the Prime Minister, Frank Crean and two of the gurus on the Prime Minister’s staff, Brian Brogan and Professor Gruen- that one of our most difficult problems and one of the primary causes of inflation and unemployment is that, to quote him, ‘throughout 1973 and 1974 wage rates increased at a much faster rate than the cost of living’. He went on:

Wage and salary earners do not need wage increases in 1975 to catch up with increases in the cost of living that occurred in 1973-74.

I add that wages rose by 26 per cent and prices by 16 per cent in the last year. In other words, inflationary expectations and the flow on of those expectations into the wage system actually resulted in a 10 per cent greater wage increase than the actual inflationary figure justified; and that was at a time when we had no increase in productivity and probably a negative production rate. Now, what does all this mean in dollars and cents? The authoritative ‘Syntec’ suggests:

It is in this period, moving well into 1 976, that the fruits of what does or does not happen in wages in the months immediately ahead will finally be full blown and harvested. If a continued ‘double counting’ process does emerge out of Australia’s ‘autumn wage offensive ‘, then 1976 is going to be the opening for a period of disaster for the private sector of this economy- worse than anything we have come through yet.

If we continue to get double counting in wages, inflation will go above 30 per cent and the structure of capital markets in this country- indeed the market place generally- will change fundamentally. Capital raising will have to be on an indexed basis: Share values, bond values, fixed-interest debenture values will collapse.

That is of course a real probability. It is critically important, therefore, that the Arbitration Commission should recognise the existing gap between wage and price increases and should remember the words of Dr Cairns, just quoted, when it makes its 1975 wage decision in the next few weeks.

The second problem is the desperate need for changes in the taxation laws to provide and permit increased depreciation allowances to enable new purchases of capital plant and equipment to take place out of earned money flows at replacement costs and not historical costs; and a tax system to permit replacement of stock at the then market value out of untaxed retained profits in order to assimilate the increases in prices between opening and closing stocks and replacement stocks. Both of these courses are obviously favoured by the Prime Minister, and I hope that the Matthews Committee will submit shortly an interim report in order to permit the necessary taxation changes to take place in the next Budget, not so much as a stimulus to production and investment but as an essential ingredient in business survival and in reductions of unemployment.

Finally, in this context of overall Government economic and industrial policy, we must face sooner or later the problem that is critically important to the survival of representative government. This is the growing authoritarian attitude of some socialist left and autocratic trade unions and the resort to violence and strikes to achieve their industrial purposes. At the time of the Tolpuddle prosecutions and the Taff Vale disorders there was good reason to take legislative action to strengthen the trade union movement against the oppression and exploitation of labour by management and the law. But that’s more than a century ago. You can’t live on past memories, attitudes, and hang ups and with all the propaganda associated with environmental and industrial conditions that have long ceased to exist. Power then resided with the employers and management and it was ruthlessly used. The world has changed; and men are now much more equal. I do not believe that the average trade unionist wants this malaise to continue. After all, trade unionists are the same as most of us in this House. They want a fair go; they want decent pay; they want decent working conditions; they want a prosperous Australia, able to play its pan in world affairs and able to defend itself. I hope that we Liberals and our coalition partners, as soon as we return to the Treasury Benches, will make it our first concern to ensure democratic control through the Arbitration Commission and the Commonwealth Electoral Office of all trade union elections and major administrative decisions before strikes occur or serious restrictive action is taken against the national interest. This would be the first step to genuinely assimilate the trade unions into the mainstream of Australian political, economic, social and industrial life. It may be ambitious but at least it is a worthwhile objective and, to use the phrase of the late Mr Chifley, a revered Prime Minister of this country, it is ‘worth while fighting for’.

Port Adelaide

-As the Opposition has now turned the debate on this Bill into an attack on specific Government programs, I am more than happy to fall into line and follow the theme that has been established by my colleague the Minister for Labor and Immigration (Mr Clyde Cameron). In terms of talking about where the Government ought to cut expenditure, only one honourable member opposite has had sufficient courage to stipulate the areas that ought to be cut. I refer of course to the right honourable member for Bruce (Mr Snedden), who said that, excluding pensions, he would cut every area of government expenditure. I remind honourable member’s of some of the areas about which they have been speaking.

I deal with one area to which the right honourable member for Bruce referred- pensions. Let us look at the history of the Liberal and Country Parties on the question of pensions. The right honourable member for Bruce said that the Opposition would cut all expenditure with the exception of pensions. From 1949 until December 1972 the old age pension was never allowed to go above 20 per cent of average weekly earnings. In fact, if it ever reached 20 per cent in any given year between 1949 and 1972, then the government of that particular year refused to give any further increase to it. So he is in effect saying that the Liberal and Country Parties would go back to their old standards of restricting the age pensioner to 1 8, 1 9 and 20 per cent of the average weekly earnings and ignore the increase in the living standards which have been afforded to the pensioners of this country by the establishment and acceptance of a rate of 25 per cent of the average weekly earnings for pensions. So we can dismiss as being a sham the claim by the Opposition that that is the only area in which it would not cut government expenditure.

Perhaps I should get on to the areas in which the Opposition says that it would cut government expenditure. Questions are raised continually in the House by honourable members opposite about certain areas of government expenditure in which they take a specific interest. I do not want to put the primary industries in the vanguard of those, but questions are continually asked about the plight of the wool industry, the beef industry and, by honourable members opposite like myself who are from South Australia, the wine industry. They are all industries which need government assistance. Before we look at what assistance they need and what the Opposition is now saying about them, let us look at some of the hopes to which honourable members opposite have referred that the Government has raised and consider whether it is a legitimate exercise to raise the hopes of people in Australia and to attract a greater community participation in government enterprises, in government initiatives and in being able to see that government moneys are spent in welfare areas. The subject of pensions has been mentioned by honourable members opposite. Let us look at other social welfare programs, such as the programs for single mothers, deserted wives, women’s shelters, women’s clinics, nursing homes and so on.

Every one of us has a nursing home in his electorate. The Government is subsidising the private nursing homes almost to the extent of $200m. Have any honourable members opposite ever been present at a nursing home when it is being closed down and watched the relations rushing around trying to place their kinfolk elsewhere as patients? Have they seen the concern on the faces of those kinfolk? Are we now to say that we are going to close down more of them when we know very well that no further accommodation is available in the cities or in the regional areas to take those people? There is a strong case for increasing government participation in this specific area. I think that the whole subject of nursing homes may become a far greater responsibility for the Government than it has been in the past. Of course honourable members opposite are quite right in saying that we have raised the hopes of people about what they can expect from our Government, which is a concerned Government. The Government is not going to backtrack on what it has done over the past 2 years. To do so would be to turn its back on the reason why it was elected. The Government is elected by those people because for 23 years honourable members opposite ignored their plight.

Let us look at the child care program that was announced recently by the Government. It is something quite new. The Government has announced that further expenditure will be undertaken on looking after the children of this country. There are 85 000 children between the ages of one and five years who are left at home by themselves while their parents are at work because there are no child care or kindergarten centres near their homes. Are we to say to those 85 000 children: ‘It is safe. It is quite an acceptable standard of living for you to be left at home by yourself? Of course not. What member of this House has said to the Government or to the appropriate Minister. ‘Do not build a child care centre or a pre-school centre in my electorate. I want to cut government expenditure’. We all appreciate their importance and the necessity for having them established. Of course it is a sham by the Opposition to put up the argument that expenditure on those sorts of things ought to be cut.

It is not just a question of looking after the children between one and five years of age: What about the Government’s whole education program? The right honourable member for Bruce said that without question expenditure on education has to be cut. Those of us who service and represent with a great deal of pride the underprivileged areas of this country say to honourable members opposite in no uncertain terms that there must be no cutback in the expenditure in the field of education. The parents of the children at the 46 schools in my electorate, which are considerably like those in all other underprivileged electorates in this country, are, because they pay their taxes, work in industry and produce the wealth in the private sector of which honourable members opposite are so proud, entitled to see that their children are given an equal opportunity of education. That is something that was denied to them right up until 1972. Only the present Government, by making massive infusions of money into the field of education, has been able to do anything about the matter.

All honourable members opposite know from their personal experiences the great pride that they can take in visiting the schools in their electorates because the Australian Government in Canberra has done so much for them. But now they are saying that government expenditure should be cut. In saying that government expenditure should be cut honourable members opposite have not named the specific areas in which it should be cut. They have not said that schools should not be provided with libraries, playing grounds or innovation grants. Honourable members opposite have also come up with the great plea that whatever the Government has done in relation to the taxation deduction for education expenses should not have been done and that people should still be allowed to claim a $400 taxation deduction for education expenses. So there is a great contradiction in the views being expressed by the Opposition.

Of course, it is relevant to what the Opposition is saying about Government expenditure in the fields of social welfare and education to bear in mind what the Australian Country Party, with the support of the Liberal Party of Australia, is saying about primary industry. Indeed, there are honourable members opposite who say that the reduction in the sales tax on motor vehicles ought to continue for a longer period than the period the Government has announced. They want to cut Government revenue in that field. Let us take the assistance in the way of the provision of food that we are giving to countries that are in need of assistance from developed and advanced countries like our own. Are we to say to Bangladesh, India and the other countries in that region: ‘We are very sorry but the Liberal and Country Parties want us to cut our expenditure, so we can no longer assist you’? I invite honourable members opposite to look at what the Treasurer (Dr J. F. Cairns) said in his second reading speech about the assistance that ought to be given to those areas. Of course we are going to continue to provide assistance because we can afford to give that type of assistance to them. Should the Government say to the spastic centres and the crippled children’s centres in Australia: ‘Do not let your hopes be raised too high because of what we have done in the past 2 years. We know that you were ignored basically for 20 years. We have since raised your hopes but we are going to let you down, as previous conservative governments have let you down ‘? Of course the Government is not going to adopt that attitude. As the Minister for Labor and Immigration (Mr Clyde Cameron), said, of course the Government is going to pour millions of dollars into Medibank to ensure that every man, woman and child is covered by a health scheme and not by the patched up job that existed under the control of 113 private health insurance companies. Are honourable members opposite in effect saying to the one and a quarter million people who have had no previous coverage or who are now being compelled to pay $70, $80 and $90 a quarter for medical insurance and who cannot afford to do so: ‘We are going to scrap Medibank’? Do they want to keep the same rotten old health system that was in existence for the 23 years in which they were in office? The Government cannot be re-elected by looking back into the past- into the 1870s- which is what the Opposition is doing. The Medibank scheme will be established. It will be established with the overwhelming support of the majority of the people. It will cover not just the one and quarter million people who have had no coverage in the past but everybody.

Let us look at the favourite topics of the Country Party. The supporters of the Country Party should be honest about it and say that they have seen great advances made in the country towns and in the regional centres as a result of the present Government’s programs in education, child care, nursing home subsidies and so forth. The Country Party is now seeking assistance from the Government for its pet industries of wool, beef and wine. Of course the Government ought to be concerned about them. Are honourable’ members opposite saying that the Government should say to the wool growers and to the rural workers of this country: ‘You are all going to be thrown onto the streets because we are not going to give the Wool Corporation the $300m it needs to buy your product. It is no good having sheep there growing wool because no one is going to buy it’, or are they going to insist, as they have done over the past 2 years in speeches and by way of asking questions, upon the Government making sure that it continues with the policy of subsidising the Wool Corporation? Would they like the Government just to let the wool be thrown onto an open market and attract to itself its real value? Perhaps that is what the Liberal and Country Parties would like the Government to do.

Is the Government to take seriously the claims . of the beef growers in this country that they need assistance or is it to say: ‘It is just bad luck that people will not buy your product overseas. You will have to be retrained under the NEAT scheme and go into the cities’, or is the Government to sit down and look seriously at the ways in which it may give financial assistance to the people involved in that industry? Is the Government to say to the wine growers of South

Australia and to those in other parts of this countryalthough they do not grow grapes that make as good a wine as South Australia’s- that it is not going to take seriously the plight of their industry? Is the Government to say to them that it is not going to sit down and discuss in a rational and proper manner the assistance that the industry needs? Let us look at the situation with respect to Darwin. Are we to say that we will cut expenditure for the rebuilding of Darwin? Perhaps the Leader of the Opposition (Mr Malcolm Fraser) will not grant a pair to enable the Minister for Northern Development and Minister for the Northern Territory (Dr Patterson) to continue his talks in Darwin. Are we to say that the $ 1,000m, perhaps, needed over the next few years for the re-establishment of the northernmost city of this country, will not be made available? Of course we are not. If honourable members look at the specifics of Government expenditure which the Opposition talks about cutting, they will find it is an impossible task. If the Government went back on promises that it has made and with which it has raised hopes in this country there would be no chance of it being reelected. We will be re-elected time and again because we will fulfil the hopes that we have raised since December 1972.


-This afternoon we have listened in this House to some extremely interesting speeches on the Appropriation Bills. We heard a very fine speech from the honourable member for Bruce (Mr Snedden), the former Leader of the Opposition and a former Treasurer of this country. He made a very valuable contribution to the debate. Because he was a successful Treasurer, it is to be hoped that some notice will be taken of the remarks which he made. No doubt they will be given prominence in the Press. Let us hope that responsible citizens in this country will read them with interest and give full support to what he said. The Minister for Labor and Immigration (Mr Clyde Cameron) made great play of the fact that the people who sit on the Opposition side are very rich people- wool barons, oil barons, wealthy pastoralists and the privileged. What has that to do with Australia’s financial situation? Many honourable members who sit on the Government side of the House are not short of a dollar. Indeed, if some of them were investigated, it would be found that some are very wealthy people.

The Minister for Labor and Immigration, for whom I have high regard, mentioned employment and what the Government was doing for the unemployed. Who is responsible for the 300 000 unemployed in Australia at the present time? None other than the present Government. The Minister eulogised the schemes which he, as Minister, has introduced to assist people who are unemployed- the Regional Employment Development scheme and the National Employment and Training scheme. He referred to supplementary assistance for those unfortunate people who have lost their jobs in the various industries which have been seriously affected by the 25 per cent across the board tariff cut. I applaud the Minister for introducing these schemes, but let us never forget that these schemes would be unnecessary if the economy of this country had been handled in a proper manner.

I cite a case in my own electorate of Paterson. This time last year a textile industry- Bradmillemployed 1300 people; it now employs under 600 people. What a terrible thing to happen to a fine industry which has been developed over many decades. Knowhow and expertise have been lost and men have lost their jobs because this Government took away the tariff protection. I, together with other citizens, were prepared to pay for the product which the industry produced and the people employed in the industry were paid on a good Australian wage basis. They were happy and the employers were happy, but the industry suffered because cheap textiles were being brought in from Asian countries. I will not name those countries but honourable members know the ones I mean. In some instances the labour employed was being paid at a rate of $12 per month. I cannot understand an Australian Labor Government stooping to actions such as this. It is evident that it did not do its homework because its actions have created chaos throughout Australia and created unprecedented unemployment. When we were in Government, I heard the present Minister for Labor and Immigration enlarging upon the unemployment figures. If unemployment was running at 80 000, in his estimate it was running at 140 000. Fancy him here today trying to put the blame on us for unemployment in this country. We were a responsible Government and we aimed for full employment. Until the last few days of the previous Liberal-Country Party Government, full employment was the order of the day.

The honourable member for Port Adelaide (Mr Young) said in his contribution to this debate that if the Opposition became the government of Australia it would cut down benefits for nursing homes and child care, and would cut pensions for age and invalid pensioners. What a lot of rubbish when the honourable member for

Port Adelaide talks in this way. He also said that if we became the government, we would cut down expenditure on education. He said we would cut down on the assistance being given to high schools and primary schools throughout the land. I abhor this. Education, in the main, is the responsibility of the Australian States under the Constitution. What the Federal Government should be doing is channel out funds to the various States of Australia so that they can take a more major part in assisting education in various fields. In the social welfare sphere, the present Government has carried on many of the policies which were instituted by us when we were in government. In the social welfare field, we raised the pension right across the board when it was necessary. There is no doubt about that.

The honourable member for Port Adelaide has talked about this Government allocating $3 50m to boost the wool trade. Mr Acting Deputy Speaker, you are a country man so there is no need for me to tell you just what the wool industry has meant to Australia. When we were in government we also bolstered up the wool industry. We purchased 990 000 bales of wool. At one stage it looked as though we had problems but members of the Australian Country Party, supported by their Liberal Party colleagues, had faith in the wool industry. We were able to dispose of that wool at a profit and thus protect our great wool industry which is so valuable not only to our own economy but also from an export point of view. Those are just some remarks about previous speeches that have been made in this debate.

I have some interesting phototstat copies of articles which have appeared in the Press. On 29 January, the ‘Age’, which is a reputable newspaper in Victoria, published the following article:

Clamp on Canberra spending

The Federal Government last night announced a tough clampdown on further increases in its spending.

The Prime Minister (Mr Whitlam) said the Government had decided there would be ‘a general presumption against’ rises in spending.

In future, all proposals will have to meet strict criteria adopted by Cabinet at its meeting yesterday.

That article was published on 29 January, but we have found that within 2 months, instead of the Prime Minister clamping down on spending, we are now debating these Appropriation Bills. It is very interesting to see that announcement in the light of what is happening and what we are debating today. An article in the ‘Bulletin’ of 1 March states:

A Treasury Paper, presented to Cabinet urging the government to watch its future spending, has warned that government spending for this financial year could be up 42 per cent over last year and that there could be a Budget deficit of more than $2, 500m- a figure Prime Minister Whitlam has already indicated he expects.

Another newspaper article states:

Budget deficit: Now is the time for the Government to cut back.

This is not creating confidence in the Australian business world, and indeed among the ordinary people of this country. The running of a government is like running a business or a private home. If a housewife has a deficit in her house-keeping money and her husband comes home and learns this, there is a row because he knows that that deficit has to be made up somewhere. That is what will happen in Australia. The huge deficit with which we are faced- over $3,000m- has to be made up in the long term. It is all right now in the short term, but in the long term somebody is going to pay for it; somebody is going to be jollywell hurt, and it could be the little people of this country, the poor people, the people whom the Minister for Labor and Immigration (Mr Clyde Cameron) purports to represent. They are the ones who could be affected seriously if anything goes amiss with our economy. It is running along all right now but let us issue a warning: There is to be a day of reckoning and, my word, we will have problems when that happens. An article castigating the Government for the deficit that exists 9 months after the presentation of its last Budget on 1 7 September last year appeared in the ‘Australian Financial Review’ on 14 April 1975. The final paragraph of that article read as follows:

Dr Cairns refuses to accept the simple logic of inflation and the contribution to it of the government’s spending cannot be justified by his assertions of disbelief in orthodox economics. To begin with, Dr Cairns is no economist -

I think he has shown us that- and never has been. Secondly, he has neither the qualities nor the justification of an E. G. Theodore. For, despite the diversity of opinions and policy recommendations among economists and civil servants, all economists of all persuasions, at every point of the political spectrum, agree that a continuation of the present rate of public spending financed not by taxation but by an effective use of the printing press can only be disastrously high inflation and, the corollary, eventually a disastrously high rate of unemployment.

This is not an article which would engender confidence in the people of this nation. Appropriation Bill No. 5 provides for an expenditure of $344.3m. On examining the figures in the appropriation it is seen that $ 10.1m is shown in respect of the Australian Broadcasting Commission and $2 5m in respect of the Darwin cyclone. The honourable member for Port Adelaide (Mr Young) said that members of the Opposition were not interested in assisting the people affected by the Darwin cyclone. What rubbish and what nonsense. The then Leader of the Opposition, who spoke in this debate this afternoon, was one of the first men to go to Darwin with the Deputy Prime Minister and Treasurer ‘ (Dr Cairns). Indeed, they were the first 2 responsible people from Canberra to arrive in Darwin. He made an assessment, along with the Treasurer, of the situation. A Liberal-Country Party Government certainly would have assisted the people of Darwin in their sad and sorry plight and to re-establish themselves, so it is utter nonsense for the honourable member to talk in that way.

Appropriation Bill No. 5 attributes an amount of $22. 4m to the purchase of ships, materials and equipment and $70m to special assistance to facilitate transfer of the function of defence to Papua New Guinea. In Appropriation Bill No. 6 the figure in respect of defence service homes is $15m and PMG cost increases $127m. This amazes us on this side of the House, particularly those of us from the country, who are faced with huge increases right across the board in telephone rentals, and in our little post office box fees. The cost of a post office box has increased to $ 12 whereas it used to be $2. People in the country areas of my electorate of Paterson have informed me this week that their mailbag fee has now gone up to $16. It has gone from $1.10 12 years ago to $16 now. Goodness gracious me, what is happening in our Postmaster-General’s Department? No doubt a lot of country people will be denied a private mailbag because they have to cut down on expenses, and $ 16 for the collection and delivery of a country mailbag is absolutely absurd. Returning to Appropriation Bill No. 6, an amount of $26.4m is shown for payment to South Australia for the acquisition of nonmetropolitan railways and $13m for National Capital Development Commission capital works and services. Those are the major appropriation in those 2 Bills.

On looking at the current state of the Australian Government’s Budget, it is found that after 9 months the deficit is of the order of $3,30 lm. The original estimates for the 1974-75 Budget on 17 September 1974 were for an overall deficit of $570m. On domestic transaction a surplus of $23m was expected. However, subsequently large new expenditure appropriations and cuts in tax rates have necessitated a revision of the Budget estimates. The original Budget which was brought down by the Government has been completely changed. It has been stop and go. The Government brought in a lot of measures which it found were unpopular and were affecting people, so it did away with them and reintroduced the system that we had when in government. This has happened in quite a lot of instances and, of course, it has thrown the Budget out. The Government has chosen to finance its spending increase of 45 per cent only partially by increases in taxation and other current receipts, budgeted at 23 per cent. The latter increase is probably roughly in line with inflation in private incomes, so the proportion of incomes taken in taxation will remain about the same as in 1973-74. In the past, Australian Governments have usually financed their Budget deficits fully by borrowing the money within Australia. However, in 1974-75 the Government has financed its deficit so far- remember that at 31 March the deficit was over $3,000m- mainly by short term borrowings, $ 1,681m of which has been in Treasury notes. It has also financed its deficit by running down its cash balances by $1 ,394m, which amounts to the printing of banknotes, which has been mentioned by the honourable member for Lowe (Mr McMahon) and by other speakers from this side of the House in this debate.

Mr King:

– No honourable members are left on the other side.


– I have blown them all out. Perhaps later in the year the Government will attempt to finance its deficit properly by raising a long term loan. However, it may have difficulty in attracting enough private funds for the loan without raising interest rates, which would run against its current stance of trying to allow an easier flow of money to private industry. My word, private industry is not very confident of this present Government and it will be delighted, when we go to the polls next time, to see the Liberal and Country Parties back in government and giving this country the services and requirements that the nation needs.

Government spending financed by cash balances or borrowing from the banking system means a net increase in the money supply. The Government spends more money without reducing anyone else’s holdings of money, which breeds inflation. No attempt has been made by this Government to arrest inflation- no attempt at all. Indeed, the Treasurer has been requested by bis Cabinet colleagues- two or three of them, it was announced in the Press recently and in speeches in this House- to cut down on expenditure. But what has been done? He thinks that money does not matter; that it grows on trees. So it goes on, with the rate of inflation increasing and with the rate of unemployment increasing. Unfortunately, unless some confidence is restored, we will see more unemployment in Australiaand God forbid! We on this side of the House want to see good Australians in good employment. If the banks buy government bonds in exchange for cash they need not reduce their lending to the private sector because the bonds count as part of their liquid reserves, just as cash does.

I will not have time to run through the economic problems that stem from the large Budget deficit. It is a pity, but never mind. The expenditure increase in the 1974-75 Budget and the prospective deficit are of unprecedented size. Never in the history of government in this nation have we seen a deficit as large as it is now, despite taking inflation into consideration. It is inevitably causing considerable problems and changes for the Australian economy. The most obvious consequences are an inflationary increase in the money supply and dislocation in private industry. We on the Opposition side of the House stand for private industry. Those on the Government side are text book academic socialists, and the sooner we get them out of government and get ourselves into government the better.

Monaro · Eden

-We have in this debate the opportunity to contrast the position of the Government with the position of the Opposition. In the speech by the honourable member for Paterson (Mr O’Keefe) we heard a typical two-way bet speech. He tentatively wondered what it was that the country would get. If the people read his speech they will find that the first half was devoted to giving money away and the second half was devoted to condemning the Government for providing the money. We find a contradictory position, the two-way bet, in his speech. The country will know what it will get if it elects the Opposition to the Government benches.

Let us also consider another position that has developed in the Opposition over recent weeks. It relates to the credibility of the Leader of the Opposition the honourable member of Wannon (Mr Malcolm Fraser). Let us examine that proposition for a moment. We find in Hansard of 1 October 1974 a straw man being built by the present Leader of the Opposition. His words were:

The Army has people pouring out of it as quickly as they can go.

Today we have the largest ever peacetime army in Australia- 3 1 500 men. Contrast that fact with his statement. On 8 April 1974 the Leader of the

Opposition, in his oft practised tactic of creating fear and uncertainty in the electorate, referred to a conversation which he said took place between the honourable member for Macquarie (Mr Luchetti) and the Prime Minister (Mr Whitlam). Immediately the honourable member for Wannon sat down the honourable member for Macquarie disowned that statement. Yet the honourable member for Wannon built up quite an edifice of fear and uncertainty by referring to a fictitious conversation. The honourable member also went round the countryside creating fear and uncertainty in the minds of meat growers by insisting that this Government would sack Colonel McArthur as Chairman of the Australian Meat Board. Colonel McArthur still remains in that position. The present Leader of the Opposition once again has his credibility tested.

As reported in Hansard on 25 September 1974, the present Leader of the Opposition claimed that this Government was charging the Australian Wool Corporation 14 per cent on the money being credited to the Corporation to enable it to carry out a fixed reserve price scheme. For the first time in Australia there was a fixed reserve price, a program that honourable members opposite would not tolerate when in government. It is well known that the interest rate on this money is the bank rate. It is not the 14 per cent that the Leader of the Opposition alleged it to be at that stage. One only needs to leaf through any Hansard speech of the present Leader of the Opposition to find an immediate challenge to his credibility and to find an illustration of the tactic of canvassing an untruth and then building a fabrication on it as a means of attacking the Government.

It is difficult to know what the Leader of the Opposition stands for. One thing that he has established in his previous speeches is that he does not stand for a flexible exchange rate. It is very interesting to hear the Opposition attacking the Government now over the deficit that exists in the present Budget. The domestic deficit, which is the one that matters so far as inflation is concerned, will be around $ 1,700m. The external deficit, of course, is disinflationary. There is no question that a deficit is inflationary. The Opposition and the Government agree on that point. Let us consider by way of contrast what happened under the management of the previous Government in 1971 and 1972. The right honourable member for Lowe (Mr McMahon), who waxed so eloquent on this theme a moment ago, may well remember that in 1971 $ 1,965 m flowed into this country by way of foreign capital and that in 1972 $ 1,922m flowed in. In those 2 years nearly $4 billion of inflationary money flowed into this country. It makes $ 1 ,700m at this stage pale into insignificance. Those 2 years were the crux of our present problems. The figures are on record. If the argument holds that a deficit of $ 1,700m is inflationary and dangerous, then how much stronger does the argument hold that $4 billion during the 2 years I have mentioned had a major effect on the present inflationary position?

Honourable members opposite cannot have a twoway bet. In opposition they try to do so. In opposition we know what they present to the country. They present the country with the contradictions in this argument, in the argument of the right honourable member for Lowe, in the argument of the honourable member for Paterson, and with the lack of credibility of thenleader. Well over half the present deficit is due to direct grants paid to industry and to the States for housing. Which of these would the Opposition cut out? Would it, for example, reduce the $670m that has been paid in the form of direct grants to agriculture, which is twice the amount of money which it paid in its last year of government?

Mr Fisher:

– It is a loan.

Mr Whan:

– I hear from the Country Party that it is a loan. Of the $670m, $380m is a loan to the Australian Wool Corporation, a very important loan, which has to be accounted for in this year. If the Opposition takes credit for the deficit of $ 1 ,700m and it also wants the loan, as it is called, to the Wool Corporation considered in those terms then it has to deduct it from the $ 1,700m. It cannot have it both ways. It is an inflationary expenditure in this year. We have to consider this if we are considering the overall deficit position of the Government.

Mr Lusher:

– Do you not want to support wool?


– I am being asked whether I want to support wool. It is not the Government that is being examined. It is the Opposition that wants to cut expenditure. It should make up its mind. It wants us to cut expenditure. Does it want us to cut it from the $670m that is going directly to agriculture?

Mr Lusher:

– Just tell us where you stand on wool.


– Do you want us to deduct it from the total of just on $ 1,000m in direct assistance going to secondary and primary industry. Do you want it cut?


-Before things get out of hand, I suggest that the honourable member for Eden-Monaro address his remarks to the Chair and that honourable members who are still to speak in the debate save their comments for later on.


– Does the Opposition want these areas of expenditure cut? Does the Opposition want us to cut the grants, again a very interesting figure, made to the States totalling $6,033m? This is an increase of 38 per cent on the amount of money given to the States last year and an increase of 59 per cent on the amount of money given in the last year of Liberal government. The States, in spite of the fact that they have this extraordinary large grant of just over $6,000m, which presumably the Opposition wants us to cut, still cry that they do not have enough money. Very recently the Premier of my own State of New South Wales claimed that his Government could not supply a new technical college in Goulburn the present one was built at the turn of the century- because the Australian Government had reduced its expenditure on technical colleges. How absurd. This Government has given the States $1 19m for technical colleges, and the New South Wales Government got its share from that cake. Yet the people of Goulburn are being told by the Premier of New South Wales that this Government did not give their State enough money. The people of my electorate and the local government authorities are being told that this Government did not give enough money to the State of New South Wales to build roads. Yet the Government has given a record sum of $1,1 60m to the States for the purpose of building roads and New South Wales, of course, got its share.

When we look at another phenomenon that has developed we find that the people in New South Wales are now starting to criticise us for not giving enough money to schools. This is incredible. Archbishop Cahill quite correctly pointed out that the Catholic schools in the Canberra diocese are suffering from a lack of funds. He said that they are experiencing extreme difficulties in financing teaching and other services in the schools. I agree with him 100 per cent in this respect. But the situation would have been very grave if the Opposition had still been in office. The facts are that today this Government finds 44.4 per cent of all funds used by Catholic schools in this area. In the last years of the previous Government the figure was 38 per cent. It is interesting to note that during that time the New South Wales contribution has fallen from 32 per cent to 26 per cent. Those schools would be in a difficult position if it had not been for the contribution made by this Government. Do we cut back this money? Does the Opposition want us to cut back this sort of assistance to Catholic schools? Sooner or later the Opposition will have to put its position on the line and tell us where the cuts are to take place.

It is worth pondering, too, in regard to the Liberal and Country Parties’ attitude towards the $240m that was given to the State Premiers in February this year. This money was provided on the basis that it would be used by the States to maintain employment. The Treasurer (Dr J. F. Cairns) in his second reading speech on Appropriation Bill (No. 3) 1974-75 said:

These funds will have a substantial effect in enabling the States to retain employees whose jobs would otherwise nave been at risk and enabling them to take on additional employees.

The State of New South Wales received $76.6m. The Shire Council at Crookwell has had to retrench 3 people. When it approached the State for some of this money which was given in February it was told by the State Government that none would be available. Just what is going on? The money is going to the State. An additional amount of $240m went in February. Still the New South Wales State Government claims that it has no funds to provide to local government authorities with assistance for employment. The very spirit of that agreement has been breached. Yet, the Opposition in this Parliament, which is of the same political colour as the New South Wales State Government, is screaming presumably because we are paying the States too much money.

I think that the people in the agricultural sector should have a careful look at just where the funds are going. We find that approximately 22 per cent of the present deficit is accounted for by direct grants to agricultural and other industries. As I mentioned before, well over half of the deficit is accounted for by grants to be used in the field of housing and grants to the States. If people in the agricultural sector support the Opposition ‘s position in regard to reductions in expenditure they should just ponder on the fact that $380m this year went to wool, $30m to rural reconstruction, $46m to the fertiliser bounty, $20m to the Commonwealth Bank for rural lending, $ 1 8m for irrigation and $ 1 2m to dairy farming reconstruction. Where will the cut take place? Under which item on that list will the cut take place? We need to be consistent. The Opposition needs to realise that the 2-way bet will not work so far as the electorate is concerned. Sooner or later sections of the electorate who are influenced by these claims will get around to examining in detail where the cuts might take place. They will need to see a consistency in the Opposition’s attack on the present Government before they will be impressed enough to take the dreadful step and vote the Opposition into office.

The Leader of the Opposition made an interesting point when he supported the proposition that the Australian Wool Corporation should have a reserve price of 300c a kilogram in the market. It is interesting to speculate what would have happened if we had had a reserve price of 300c a kilogram in the market. He claimed, and he may be right, that the Corporation would not have to purchase any more wool than it has already purchased. If we accept that proposition the increase in the deficit would be of the order of $ 80m to $ 100m. If the Leader of the Opposition supports the general commitment to the restoration of the superphosphate bountyalthough he may have made a comment on this subject I have not seen it- the deficit would have been increased by another $200m, because that is what it would have cost this year. The man who wants the Government to cut expenditure wants another $300m to be spent.

The electorate will not be impressed by the inconsistencies that run through the Opposition’s case. When we look more carefully at the present Appropriation Bill we realise that not one member of the Opposition has told us whether he wants to reduce expenditure in the field of defence which is an item which has been mentioned in this legislation. We have not been told whether members of the Opposition want expenditure reduced in payments to the Aboriginal Advancement Trust Account, independent schools in the Territories- these include Archbishop Cahill’s schools which I have already mentioned- adult secondary education assistance, assisted migration, child migration education, health insurance, victims of cyclone Tracy and handicapped children. Where would the Opposition make its cuts in relation to these items? Can it name one, two or three items contained in this legislation on which it would cut expenditure? Until the Opposition does state where it wants cuts in expenditure, how on earth can the electorate regard it as a credible alternative government?

At present we have a serious inflationary problem in this country which stems back to 1 97 1 and 1972 when over $4 billion flowed into this country. Today we have an internal deficit of $ 1 ,700m. If in fact $ 1,700m is a dangerous inflationary factor, how much more serious was the $4 billion that the Opposition engineered in 1971-72? We should consider the cost of that amount of $4 billion which was not printed money but was obtained by selling off Australian assets. This $4 billion worth of Australian assets was sold off in order to get that amount of capital into the country. We put it to the electorate: Can people have any doubt at all which choice they would make- $ 1,700m in printed money or $4 billion acquired by the selling off of Australian assets to overseas interests? Which formula would they choose? Which formula is in the long term interests of this country? That is the proposition that emerges when we look objectively at the position we are now considering. It is incredible that the right honourable member for Lowe (Mr McMahon) should stand in this place to defend the actions of his Government to which I have just referred and attack the actions of this Government. I repeat: Which proposition would the electorate choose: Selling $4 billion of Australian assets or printing $ 1,700m in order to make sure that the economy is maintained at a reasonably productive level in order to ensure that the facilities so long denied education, child welfare- one can go on- are supplied to the community? We should ensure that people are able to maintain their self respect by being able to work. There is no doubt in my mind what the electorate would choose if this proposition were put to them.


-We have listened again to another tirade from the honourable member for Eden-Monaro (Mr Whan) who finds it impossible to control himself in debate in this chamber. He continues to come into this place and make speeches which are full of invective and often he says nothing constructive. He is the man who believes that religion is on the way out. It is this Labor Government led by the Prime Minister (Mr Whitlam) which is on trial. The Leader of the Opposition (Mr Fraser) has made it clear that the responsibility for this nation is in the government’s hands. There is now no threat of an election. The Government’s term has another 2 years to run. In that time it has to face up to the problems which it has created in the economy. There is no point in going back into history. There is no point in going back into what the previous Government did. In this debate we are looking at what this Government has done to the economy and asking what the solutions are to those problems.

It is the current mess which has to be considered in this Parliament. We have to sheet home the responsibility where it belongs. It belongs fairly and squarely with this Government. The honourable member for EdenMonaro should make his position clear. We know how he voted in relation to the Phosphate Fertilizers Bounty Bill 1974 which was brought in late last year. He voted against the continuation of the superphosphate bounty. Yesterday in this place we heard a member of his resources committee- the honourable member for Wilmot (Mr Duthie)- saying that that committee was trying to back-track on that Bill and put something forward which would allow a superphosphate bounty to be paid to people who used up to 30 tons. The honourable member for Wilmot informed the House that that would cost $50m. Yet in the full year prior to this when the superphosphate bounty was paid to all users of superphosphate the total cost was $58m. So there will be a $8m reduction.

The honourable member for Eden-Monaro has done nothing for beef. He has ignored his electorate and the needs of the rural producers. He has become the honourable member for Queanbeyan. Let us not talk about the cuts that we want to make. This Government can expect to introduce at least 2 more Budgets into this place before the policies of the Opposition will be put on trial. We have had 20 months of the honourable member for Eden-Monaro and nothing constructive about the economy. We have the greatest problems in generations facing our economy and yet we have heard nothing constructive from that honourable member. These Supply and Appropriation Bills come into the Parliament at a time of great difficulty for the Australian economy. We are faced with heavy unemployment. The number of people who are presently out of work represents about 4te cent of the work force of this nation. Inflation is running at a high rate. The predictions and expectations are that next year the rate will rise as high as 30 per cent. Where are the causes and responsibilities for these problems which face the economy? They lie in the mismanagement of the economy by the Whitlam Government.

In 1973 we saw a Budget introduced at a time when the Government had an opportunity to tighten up the economy. But it blew that opportunity. It introduced an expansionary Budget and allowed the economy to continue to run riot. This Budget has to be followed by a tight money period. I ask the House: ‘Who has felt the effects of that tight money period which followed the 1973 Budget?’ The burdens were borne by the young home buyers, the people who are supposed to be represented by this Government, the people who are on fixed incomes, the superannuitants and the pensioners. The burdens were borne by the people who have their assets in financial form rather than in property form. Those people saw significant reductions in the value of their assets. The burden was carried by companies which were forced to narrow the margins of profit and to absorb increases in costs. We have seen the burden borne largely by those people who are in the position of having to pay interest.

This period was followed by another Budget in 1974 which led to further expansion and, at this time, it has finished up with a Budget deficit which is running in excess of $3,000m. At the end of the financial year the deficit is expected to be about $ 1.8 billion. What is the scene which faces the Australian people in the next 12 months? Enormous problems face Australia in the next 12 months because of the crude Keynesian policy which the Treasurer (Dr J. F. Cairns) is pursuing. It is only likely to increase further unemployment and inflation in this country. If inflation runs at only 15 per cent next year there will be significant problems in Government programming for the Budget. We can expect a relative reduction in the growth of taxation receipts next year. Company profits are going down. The vast rake-off which Treasury will take from company profits next year will be down.

There can be no doubt that the taxation incidence in rural industries will also be significantly reduced. There will be some sort of crisis which will have to be faced up to by the Treasurer. Where will he get the money in the next 12 months to run the programs which have an inbuilt expansionary aspect? It can only be from further deficit financing of the economy over this period. The Australian people will not be faced with a Government which is prepared to offer restraint and to put the policies which should result in the economy being put back on to a more stable footing. The Government will continue to print the money and to run the economy in order to appease its constituents. Any meaningful economic program in this country or in any country implies a control over the money supply. It implies a control over the increase in Government spending and some control over the increase in the tax burden which accrues to the Government as a result of the built-in inflation in that system.

These are difficult times. But this Government is creating a rod for its own back. It is looking around for excuses. The excuses are not there. It must be prepared to accept the responsibility for its actions. It must accept the results of the policies which it has been responsible for introducing. The Government has failed to learn from the experience of the last 2!6 years it has been in power. There is no indication that it is prepared to change its heart and to introduce a Budget later this year or to introduce Supply and Appropriation Bills at this time which give indications to the Australian people that there is an air of responsibility about the economic management of this country. We have noticed in the economy a significant collapse in private investment, in new investment and in capital investment. This has been largely brought about because of the uncertainty about where the Government is taking our economy.

Nobody, whether he be a steel manufacturer, a small factory owner, a primary producer or a shopkeeper, is prepared or indeed able to commit himself for new expenditure and new investment when he does not know from day to day or from month to month, because of the economic climate, over what period he will be able to depreciate that asset. He does not know what will be the likely effect of other Government policies on his operations. This uncertainty is something which must be removed. Guidelines must be put down and guaranteed over a period so that industry knows where it stands and so that people will be able to invest with confidence. Interest rates have been extremely high and nobody is able to guarantee that new investment which has been financed by money at high rates of interest will be able to earn at a rate sufficient to cover that interest. In industry money has been tied up in stocks which have been building up because of the slow-down in the economy and, until recently, the lack of desire on the part of consumers and manufacturers to spend. We have been through a period of profitless prosperity, and that has been followed by our entry into a severe recession. The Treasurer’s belated recognition of private enterprise and the need for profit to fuel growth and activity is recognised. However, the Government’s actions do not bear out the stated philosophy of the Treasurer.

The Government’s measures have brought about the problems, but they have done nothing to remedy them. There have been a few palliatives, such as the reduction in company tax by 2’/2 per cent and the increase in the depreciation rates over a short term. But those palliatives are by no means sufficient to enable industry to have the confidence it needs to invest and to prime the economy in the way in which it ought to be primed. The Minister for Labor and Immigration (Mr Clyde Cameron) told the House this afternoon that the Regional Employment Development scheme has been a significant factor in the Government’s stimulation of the economy. The RED scheme in fact is an artificial scheme. It is not bringing about stimulation in the economy in those areas where it is needed. The only solution for Australia today is to prime private enterprise and private industry so that they may invest and pick up the slack that exists in the economy. The Government and the Treasurer stand condemned for their mismanagement of the economy- an economy which should be going from strength to strength. It is apparent that the Treasurer is a man who listens to the person who spoke to him last.


-They tell me that economics is the dismal science. I think we would all agree that the economic speech just made by the honourable member for Hume (Mr Lusher) was very dismal indeed. I will not engage in much discussion about the economic situation in Australia at present. However, I point out to honourable members that it was about this time last year that the Government was thinking of introducing a very tough Budget indeed. Then it was persuaded by all the economic wisdom in the country and by the Opposition that that simply was not on. It seems that we are going to have a repeat of that whole situation. Whether it was intended to cut back government spending to the extent required to cure the problems in the economy by means of one Budget or two Budgets, I think we would be left with just as many problems in areas of the economy other than employment and investment. It seems to me that until we can get more consensus in the economy we will not lick this problem. There are many aspects of the inflationary problem to which many people can contribute just as long as there is some consensus in the community. I was very happy to hear some Opposition members trying to be constructive and trying to give the people of this country some guide as to those areas in which they see, from their point of view, that there is a possibility of consensus. Likewise I have heard many comments from the Government side in relation to this matter. I wish to heck we could take it out of the party political context, because too often we seem to be repeating the same old cliches; too often we adopt the other fellow’s cliches and the arguments become circulatory.

Rather than talk about the dismal things- I have been dismal all week- I thought I would get on to some of the joyful things. I am very lucky- I am privileged in a way- in that I represent a part of Australia in which the

Government’s programs are having a very positive effect and in which real progress is being made in terms of some of the objectives which in 1972 the Government was elected to carry out. Recently I addressed a seminar at the Royal Institute of Public Administration. I spoke on the Parliament and the Public Service and I said that in many ways the Department of Urban and Regional Development resembled a religion more than a department. I was referring, of course, to the very open and very flexible way in which the officers of that Department have gone about working in a very complex area- an area involving 3 levels of government, an area involving many concepts about planning, an area involving many community attitudes. I am rather overjoyed that the Department has pursued its work more by way of a religion than in the traditional manner of constantly referring to files which is adopted by most departments. So I stand in praise of the Department of Urban and Regional Development.

I stand in praise of the Department particularly in regard to its breakthrough on 11 December 1974 when it reached agreement with the New South Wales Government. That agreement was the culmination of many months of quiet negotiation with such born negotiators as Sir Robert Askin and Mr Tom Lewis. It was, I think, quite a credit to the Minister for Urban and Regional Development (Mr Uren) because he quietly negotiated his way through to agreement rather than trying to drag the New South Wales Government to the cash box. The whole concept of development in the CampbelltownCamdenAppin area- it is now called the southwest sector- is not the creation of the Labor Party, of course. The State Planning Authority has been talking about this area as being one of the prime areas of growth in the Sydney area since way back in the early 1960s, and it brought out its report on Sydney 2000 in about 1965 or 1966, I think. So Campbelltown and the whole south-west area was clearly designated. The Australian Government simply added the HolsworthyMenai area. So the Australian Government is simply fleshing out the bones of the plans of the State Government.

The agreement which was reached and signed in February of this year in fact consisted of 6 agreements which will provide something like $73,927,000 to New South Wales for urban and regional development programs in 1974-75. Under the agreements financial assistance is given to programs in New South Wales under the following headings: National Sewerage Program, $42m; Urban Land Council, $ 10,400,000; a specific allocation to the south-west sector, which is the Campbelltown-Holsworthy area, $1Om area improvement programs, $5,500,000; Bathurst-Orange regional development project, $5m; and the National Estate program, $1,027,000. All those programs, with the exception of the Bathurst-Orange development project and the area improvement programs, directly involve the area which I have the privilege to represent. Of the $ 10m which will be made available in 1974-75 to the Interim Development Authority for Sydney’s south-west sector, $7.5m will be used for land acquisition, and $5m of that amount will be used for acquiring land for urban use. The remainder will be used for acquiring open space land in the Camden Park Estate. As honourable members will be aware the Camden Park Estate contains probably Australia’s most historic, and most important architecturally, homestead. The amount of money required for the acquisition of the Camden Park Estate will be made available by way of a non-repayable grant which will represent two-thirds of the total cost of the acquisition. So all these plans are going to come to fruition. There are problems in that the agreements have been signed a little late in the day.

The Australian Government insisted that a proper development corporation be set up, and it was also insistent that its programs be mapped out in terms of modern planning principles and that the 4 local government authorities concerned have representation among the 8 commissioners who would run the corporation in terms of its administration or policy formation. The corporation would have to encompass a structure with sufficient power and autonomy to run an effective planning development, promotional and land management operation. The corporation also needs to be powerful enough to coordinate all levels of government as well as private and public investment. It will also require very substantial financial resources to ensure the attainment of planning and development goals and a high standard of services and environment.

Of the $10m to which I referred earlier, the $2.5m which I have not nominated will go immediately this year to some quite vital projects in the various industrial and district areas in the south-west sector. For example, in the MintoIngleburn industrial area an amount of $425,000 will be spent this year on roads and bridges; $482,000 will be spent on water supply and sewerage; $ 1 50,000 will be spent on the extension of electricity services; $436,000 will be spent on flood mitigation works; and $1 12,000 will be spent on landscaping. In the Minto and Badgally districts the same sort of projects will amount to $1 17,000, and in the Campbelltown city centre about $748,000 will be spent, some of it on the very basic infrastructural work for the new city centre which will be on the site of the present golf course.

All in all the State Government seems to be cooperating very well and putting up programs that are totally integrated. By doing this the Australian Government can assist by way of finance in the knowledge that the money will be well spent. It is exceptionally important that the 3 levels of government can agree as to the proper planning proposals. What we must stress is that if the whole basic infrastructure of the south west sector is set out in terms of these planning concepts, in the long run we will have all the services provided a lot more cheaply. That is the reason why we can now start phasing in the other Australian Government departments which are involved in the development of this area which hopes to have a population of about 500 000 by the turn of the century. This is why we can now talk with some certainty about a university being started there in 1978. This is why we can talk with some certainty about the likelihood of an Australian Government office block being built there. Even today officers from the Department of Services and Property are working in the area. Already the New South Wales Government, after a little cajoling, has agreed to a public hospital being built in the area. The New South Wales Government already has agreed to our financing of the Bradbury community health centre, the one at Leumeah and the major one being built now in the centre of Campelltown

One needs to realise that in Campbelltown there still are real deficiencies. A recent report showed that there is a deficiency of doctors, dentists and lawyers- the professional people- in growing areas such as Campbelltown. For example, the report showed that a wealthy municipality like Woollahra in Sydney has 133 doctors, 66 dentists and 31 solicitors’ officers while the outer region of Campbelltown has 9 doctors, 10 dentists and 5 solicitors’ offices. In terms of the number of doctors per 100 000 population, Campbelltown is in the worst 10 areas in New South Wales, having 26 doctors per 100 000 population. The Campbelltown City Council also is working exceptionally well in the context of the 3 levels of government and planning is going on there with respect to the schools program. At Minto, Ingleburn, and soon at Leumeah, we Will have integrated community centres involving the schools program. The only other thing I would like to mention is the community radio station which will allow all the people in this area to have a direct voice in the planning proposals that are affecting them. By this medium they will be able to express their opinion on many of the very wonderful things that are happening.

Suspension of Standing Orders

Motion (by Dr Cass)- by leave- agreed to:

That so much of the Standing Orders be suspended as would prevent the Leader of the Opposition speaking for a period not exceeding 30 minutes.

WannonLeader of the Opposition

– The Appropriation Bills that we are discussing today provide for an increase of 45 per cent compared with that provided by the equivalent Bills last year. The Supply Bills being debated provide for a 62 per cent increase compared with last year. The extent of the increase is a measure of the disarray in the Australian economy brought about by the policies of the present Government. We need to understand- the Government in particular needs to understand- what has gone wrong and why the Government is so incompetent in its fumbling efforts to tackle the great problems of inflation and unemployment. At the very outset the Government sought to do too much too quickly. The number of programs which, taken by themselves, might well have had merit, taken altogether represented an impossibility for our economy. The Government’s expenditures in 1 973-74 were 24 per cent more than the previous year and this year they will rise probably by about 45 per cent. No country can stand that rate of increase in government expenditure without paying a heavy penalty.

At the same time the Government introduced a series of measures which have resulted in a major attack on private enterprise, on individual effors and initiative. We know the impact of the Government’s successive revaluations of the Australian dollar. We know the story of the 25 per cent across the board tariff cuts when the Government sought to restructure the whole of Australian industry at once. We know the history of its salary and wages policies which even the Prime Minister (Mr Whitlam) concedes have now added to inflation. We know the impact of the abolition of the investment allowances. We know the impact of the attack upon primary industry. We know that the Government has threatened a capital gains tax- a threat that has only been postponed. We know that even though the Government sent its Treasurer (Dr J. F. Cairns) to the Middle East to seek funds for

Government purposes it has abused foreign investment and multi-national companies. It has inhibited investment, development and growth, whether it be by small businesses or by large international firms. We know of its weakness in the face of trade union militancy.

It is the expenditure policies of the Government, coupled with the wage policies earlier enunciated by the Minister for Labor and Immigration (Mr Clyde Cameron), that have led to an inflation greater than that which Australia has known before. That in turn led to a credit squeeze and high interest rates. On top of that, the Government’s attitude to industry, to overseas investment, to international trade, coupled with inflation and the credit squeeze, has led to a loss of profit, a lack of investment and large scale unemployment. The Government deliberately created competition between the Government sector, private enterprise and wage and salary earners. The Government encouraged wage and salary earners to increase their share of the gross national product, which they have done, and at the same time it was increasing its own demands on resources. Since there must be a limit to resources in any one year, the squeeze or the reduction had to come on private enterprise and individual initiative. That is precisely what has happened. Profits have fallen and investment has faded, leading again to unemployment.

The Treasurer and the Prime Minister have sought alibis for their own economic mismanagement. Even in recent days the Treasurer has been saying that inflation is basically overseas caused. Today the Prime Minister says that inflation is caused by excessive wages; but last year the Prime Minister also was saying that inflation was imported. Then he sought to blame the Treasury for poor advice. He blamed the Treasury for inadequate statistics, even though it does not compile the statistics. He blamed the Treasurer, whom he sacked, and installed instead the person who in fact had written the last Budget. Then realising his error of judgment he required that the Secretary of the Treasury and the Chairman of the Reserve Bank report directly to him, the Prime Minister. That was his last alibi. He could no longer say that other people were responsible for the economic ills besetting Australia.

Having gone through this somewhat tortuous process the Prime Minister at last came to the view at the end of January that it was excessive wage claims that were the cause of inflation in Australia. He made no mention of the Government’s excessive expenditure demands. He made this point in a significant speech in Adelaide when he emphasised that inflation today was undoubtedly and almost solely due to wage claims and wage increases. That is in marked contrast to the Treasurer’s recent statements in the House during this last week. There is a marked contrast of view between the Prime Minister and the Treasurer which ought to be noted. Throughout last year both the Treasurer and the Prime Minister ignored the fact that Australia’s economic difficulties were caused by Australia’s decisions. It is only the Australian Labor Party Government that can be blamed for the consequences of revaluation, for the consequences of tariff cuts, for the consequences of the wages policy of the Minister for Labour and Immigration, for the consequences of expenditure decisions and for their attack on business confidence. These are all Australian Labor Government decisions for which the Australian Labor Government must be responsible.

To quote an oft used phrase of the Prime Minister, ‘the fact is’ that by overseas comparisons the Australian economy is performing very badly. Germany, the United States of America and Japan have achieved a significant improvement in their economies and with only a mild degree of prediction of the figures I believe that the American inflation rate is likely to fall from about 12 per cent to 6 per cent, Germany from 6Vi per cent or 7 per cent to 5 per cent and Japan might well come down from over 23 per cent to approximately 10 per cent in the foreseeable future. Australian inflation gives every indication of moving in the other direction. In addition, Australia’s unemployment is worse than most Organisation for Economic Cooperation and Development countries, whose employment levels are normally quoted. In short, the Government’s inflation is caused by its expenditure and by its wage policies. Unemployment has been caused largely by the Government’s attitude to industry, by the inflation which has resulted from its haphazard approach to economic affairs. Industry has run out of profit; investment has dried up; unemployment has grown. Australia’s unemployment is worse than in Japan, France or Germany, it is equal to Italy and worse than the United Kingdom, Belgium and the Netherlands. Our proud international record in maintaining full employment has been shattered by this Government, and that cannot be a very proud achievement for a Labor Party which is committed in theory to full employment.

The indictment of this Government is that it has never had a comprehensive policy to deal with Australia’s economic development and growth. It has never had an understanding of the many inter-acting factors that press in upon an economy. It seeks to cut up the economy in different ways. It does not realise that a Government needs to establish the circumstances in which an economy can grow and expand. It appears to have changed its attitude at Terrigal, but I believe that this is a tactical change much more than a change of heart; a tactical manoeuvre in recognition of the fact that temporary and short-term co-operation with private enterprise, with individual initiative is essential if the Government is to have any chance of surviving. In the last few days the Treasurer has made it quite plain that he believes it is perfectly proper to continue deficit financing to a greater and greater extent in an effort to lower unemployment. I applaud his objectives in seeking to lower unemployment, but he needs to realise that his policies created unemployment in the first place and, unfortunately, his present policies will in the end make matters worse. Unemployment breeds on inflation. As the ‘Financial Review’ put it today:

Dr Cairns’ comments were notable for their confusion, their lack of comprehension of current economic issues, and their out-dated demagoguery … He understands virtually nothing about the process of inflation.

The Government believed that it could incite wage and salary earners to ask for higher and higher wages and that it could control inflation by one of the toughest credit squeezes and the highest rates of inflation that had ever occurred. The policies did not and could not work, and in these matters the Treasurer is now out of phase with his own advisers. Professor Gruen and Brian Brogan are both on record as having said that taxation increases or cuts in expenditure are desirable and necessary in the sorts of circumstances that are going to be facing Australia in the future. In fact, the Government’s present approach to economic problems is more than 30 years out of date.

Let me examine why Keynesian-type pump priming, which is the course the Government is pursuing at the moment, will not put renewed life and vigour into the individual enterprise economy in present circumstances. Keynes wrote during the period of the great depression that when currency values were stable interest rates were low. There was moderation by governments and trade unions. There was great unemployment and resources lying idle. The great problem in the 1930s was lack of demand and therefore Keynes wrote that pump priming could work and would work to restore demand, to restore industrial activity and employment.

Theodore sought to practise that policy in Australia and it would have been better if he had been allowed to do so. Similar policies have worked at different periods in the post-war years.

In the present circumstances, however, the Government is pumping huge sums into the economy in the hope that it will provide a lift off for the private enterprise sector, but the preconditions for successful take-off do not exist. There is no stability in the economy. There is high, and the prospect of higher, inflation. There is continued excessive pressure for wage demands. There are very high interest rates. Government policies have made Australian companies uncompetitive with foreign imports, and there is a resort therefore to import licensing. Many businesses that would like to plan and invest for the future cannot do so because they have no prospects of covering the borrowed funds. To be successful in the present circumstances, pump priming would have to be directed to reducing costs and providing incentives, but the funds being used are not going in these directions. Today the business objective is simply survival, and it is very hard for many to achieve even that.

Whenever the Government gets into economic trouble it tries to create a smokescreen. Last week the Prime Minister sought to divert attention from his Government’s mismanagement by asking the Opposition where it would cut expenditure. The Australian people are looking to the Government for the answer because it is the Government that has the power to act. It is the Government that is the Government, in case the Government has forgotten. When will the Government overcome unemployment? When will the Government reduce inflation to reasonable levels? The Government’s suggestion that the Opposition should indicate where it might reduce the rate of expenditure is absurd. In the normal course of events, it is still 2 years until there will be an election. I should hope that in the interests of Australia the Government can get the economy under control before then. If it cannot, many tens of thousands of people throughout Australia will be grievously hurt. As a result of the Government’s inconsistent policies and as a result of fast changing events, it has become very difficult to predict what will be the circumstances in the Australian economy 6 months, 12 months or 18 months from now. It is quite impossible to predict the new expenditure commitments that the Government will enter into within the next four or five months or even in the next Budget. What is certain is that it will enter into new expenditure commitments because it never ceases to do just that. In these circumstances, it is nonsense to suggest that the Opposition should say where and how it would curb the rate of Government expenditure when it comes to power. We just do not know what the situation will be, and the Government, even with the resources available to it from Treasury and the great departments of State, I suggest is so out of touch with what is happening that even with that advice it does not know what the situation is going to be.

While saying very firmly that the question put to me is not a relevant question to ask the Opposition, let me say also with absolute firmness that in government we would give high priority to allowing individual Australians a greater right to determine more of their own economic and social destiny. We would give great priority to the continued improvement of education and to the provision of facilities for the disadvantaged. Their right to protection now- and following any further economic madness of this Governmentwould be preserved. We would give high priority to the right of the private sector to be able to make profits, whether they be large corporations or small one-man businesses. We would give high priority to protecting the Australian national heritage, to protecting and defending both our cultural and material heritage, and that would involve a higher priority for defence, which today has no priority at all.

Let me remind honourable gentlemen opposite that they are the Government. Their role is to make decisions determining the future of Australia. It is their job to govern now. It is our job to ask the questions and it is for the Government to tell the people of Australia what programs it has in the longer term for the management of this economy. The way the Prime Minister today and yesterday and on other occasions has treated frivolously the most serious questions concerning inflation and unemployment and deficit financing will not impress any Australian or any person in this House. We know quite well that his lack of answers flows merely from an inability to provide an answer. When is the Government going to cure inflation? Next year? The year after? In 1980? If it is left to this Government, inflation will endure until the average person in Australia is destroyed. And when is the Government going to cure unemployment instead of just making payments to try to hide the level of unemployment? I believe that some payments have been made without Cabinet authority and without the proper authority of the Parliament. How many payments have been made of the kind that were made to Electrolytic

Zinc in Tasmania? Two million dollars, I am advised, on the decision of the Prime Minister and the Treasurer alone. But when is the Government going to cure unemployment? We need an answer to that question. And how is the Government going to achieve it? We are entitled to know that, and the Treasurer and the Prime Minister leave us without any answers.

Let me also ask the Government this: If by some odd chance its policies are successful and the private enterprise sector does take off, how will it prevent Australia from bursting forth into a violent period of hyper-inflation towards the end of this year or more likely in 1976? The Prime Minister has said that if unemployment falls to reasonable levels the Government will not increase taxes and it will not cut its expenditure programs. Therefore there would be a violently inflationary circumstance. In that situation would he be able to prevent inflation from rising to monstrous proportions? Would he resort merely to a credit squeeze, as the Government has done on past occasions- as the Government did last year? Would he resort to even higher interest rates than the Government has already done? Those are major questions and we have been left without a single answer to them. The Government has an obligation to answer them and to do so validly and clearly- in a way that can be understood- and not evasively, as has so often been the case in these matters.

So far the Government has refused to set out its long term objectives for the Australian economy and the way in which it would achieve those objectives. Our objective would be to establish the circumstances in which industry could return to profit and in which people would have the incentive to work 5 days a week. Indeed, upon visiting factories too often one finds that when the subject of absenteeism is raised people say that it is just not worth while working a full 5 days because they believe that the Government is taking too much of the fifth day’s pay. We could argue for wage restraint. We would establish close communications with employees and the trade union movement so that there can be a continuing dialogue and discussion, and reestablish in a statutory form the National Labour Advisory Council that the Minister for Labor and Immigration (Mr Clyde Cameron) abolished, thus cutting off proper tripartite communications between government, management and the Australian Council of Trade Unions. We would look for and encourage in the President of the Australian Council of Trade Unions- the other Oxford graduate- a leadership role- a role of national responsibility which would be in the best interests of the trade union movement and of Australia. We would change the Conciliation and Arbitration Act to re-establish reasonable rules for the conduct of industrial relations, to provide greater protection for the public interest and to uphold the system of negotiation, conciliation and arbitration which has served Australia so well for a long period.

As private enterprise started to move forward in changed circumstances, with confidence restored, there would need to be a phased reduction in the rate of government expenditure so that there was no longer a basic competition for resources between government and private enterprise and that includes individualspeople as much as businesses. We would at the same time establish a truly federal system of government and prevent the concentration of overriding political and economical power in one place. While there is need for the Federal Government to have complete control of the economy, we must at the same time recognise that there are many other economic powers now in the possession of the present Government which are not needed for the mechanisms of economic control. If some of those powers were decentralised so that the States asserted a greater influence over their own affiairs the prospects of economic irrationality and of gross extravagance would be much less than they are under the systems that have been created in the last 2 years.

Let me make a final point. Partly as a result of the history of the last 30 years, politicians have tended to believe that it is a proper and good thing for them to buy votes with other people’s money. Keynesian economics in the 1930s established it as an acknowledged and respectable policy for governments to spend more money than they collected in any one year. The only trouble is that the present Government has gone on spending more money than it collects. While Keynes was writing in the circumstances of the depression, that view had validity. But that view aroused expectations- great expectations- in people. Governments could actually spend more than they gathered in taxes and be praised for it. After the war the social and economic theories of Keynes were widely practised. In the right circumstances they contributed greatly to the value and richness of Australian society.

For some time after the war the memory and fear of massive unemployment was still evident. Politicians still had some inhibitions about spending too much of other people’s money. Recurring balance of payments crises and the moderation of trade unions maintained adequate restraint by government and in our community at large. Thus inflation was held to reasonable levels and unemployment to a minimum. Two things have now altered. Some trade union leaders seem to be no longer fearful of large scale and continuing unemployment, even though today some of their actions should give them cause for much fear on this count. Secondly, national governments- especially this Government- tend to have lost the art of restraint. As a result, governments now act as if their resources are without limit and as though they can spend and spend and spend. People can lose all perspective when it comes to expectations from governments. For some the cry is: ‘Ask the government and the government will provide’. We must understand that in asking governments we are asking our neighbours, our friends, and that ultimately what the government pretends it can provide must come from the pockets of every average Australian. Unless governments and people can again learn to practice restraint and unless we can cast off the selfishness and greed that has been so much encouraged by the Government in the last 2 years there will be little hope for us as a nation and none for our social and economic structure.

Prime Minister · Werriwa · ALP

– We can now see the great political advantage which the Opposition sees in changing its leader. By abandoning threats to cut off Supply it can avoid saying what it would do if it won government. It can criticise but it need not propose. By professing that it cannot foresee what expenditures the Government will propose in the remaining 2 years of this Parliament the Opposition can evade questions on what government expenditures it would cut out or cut down. The Opposition can generalise; it need not specify. Therefore, I suppose, that we can expect that for the next 2 years every piece of expenditure that we propose will be applauded, that is, every specific proposal always will be admirable. During those 2 years, then, I suppose the Opposition can say: ‘There is too much government expenditure. In general, overall, it is excessive’, but every specific thing we put up it will in fact support and probably say that we are not doing enough.

Just over 5 months ago- on 12 November last- I announced to the House a series of economic measures which supplemented action already taken in the Budget. The measures had 4 objectives: first, to maintain consumer demand through a substantial reduction in personal income tax; secondly, to attack inflation by reducing the pressure for wage increases through a substantial improvement in after-tax takehome pay this financial year; thirdly, to enhance business profitability by a reduction in company tax and other measures; and, fourthly, to support particular industries where special problems were emerging. In announcing these measures I warned that it would take considerable time for the measures to take their full effect and that for several months the figures- the unemployment statistics and the cost of living index- would not be good. We are now beginning to see the upturn which we have sought so earnestly.

Apart from their domestic significance the figures serve to remind us of the outstanding characteristic of Australia’s present economic difficulties- they are international, they are world wide in character and they are world wide in incidence. Governments in comparable countries are grappling with the twin problems of high unemployment and rapid inflation. Most governments have adopted measures similar to those of the Australian Government. Trudeau was ahead of Cairns but the Organisation for Economic Co-operation and Development countries in Europe followed and the United States has followed since; that is, the comparable countries have accepted the general trends which we were in the lead in introducing. Only Trudeau was ahead of Cairns in seeing where the greater economic and social threat to our mixed economies, our democratic systems, lay. The governments of all comparable countries acknowledge that there is no simple or single solution for our common problems. No government has been more energetic in the quest for a solution or more flexible in its approach than the Australian Government.

The extraordinary speed with which economic circumstances change in all modern mixed economies requires an altogether new degree of flexibility in economic decision making. We do not intend to be scared off from making needed and proper changes by cheap charges of inconsistency. Economic circumstances here and throughout the world are now subject to rapid change never experienced in the lifetimes of any of us. The business cycle which used to take five to seven years for its completion now appears to take about 2 years. This imposes unprecedented pressures on governments and requires very great flexibility in policy planning. In this situation one has to be extremely careful in making predictions based on the latest set of economic indicators. We must beware of false dawns.

Nevertheless, there are grounds for some cautious optimism. The situation at present is that some of the more serious aspects of decline in activity are now behind us. Credit is freely available and the demand for funds, particularly for housing, is high. Imports are no longer excessive and the balance of payments situation, particularly on current account, is strengthening. We are seeing the first real signs of recovery in employment. With the large personal tax cuts, including the housing interest deductibility scheme now being reflected in pay packets, disposable incomes are rising strongly.

This foundation for recovery has been achieved by new measures taken since the Budget. Inevitably the estimates of expenditure and receipts contained in the Budget have been amended. We make no apology for that, just as we make no apology for the post-Budget measures themselves. The increased estimated deficit is the necessary consequence of those measures. The Budget itself was criticised last September as being too expansionary. With hindsight, we can see that it was not expansionary enough. That deficiency has subsequently been corrected. The deficit is now estimated as most likely to be of the order of $2,300m, with a domestic deficit of about $ 1,660m. That deficit has to be put in the perspective of the separate items which compose it. The cry now is that Government spending must be cut. The fact is that the really big items where spending has been increased most, compared with the Budget estimate, are precisely those which are contributing most to the recovery in the private sector- the private sector, not the Commonwealth sector nor, indeed, even the State sectors.

Let us look at the details. Let the Opposition declare that it would cut spending on these items. I am not asking the Opposition to speculate as to what new expenditures the Government will bring in during the remaining 2 years of the Parliament. I am not asking anybody to speculate on these things or to imagine these things. I am just asking that there should be as precise an attitude declared to those measures which have been taken since I announced them last November. High-flown generalisations about Government spending are not enough. Nobody will be convinced by Opposition members saying: ‘We do not have to be specific until we bring on an election’.

Spending on social security and welfare is up $2 10m on the Budget estimate. Would the Opposition deny the correctness of our pensions increase in even human terms or economic terms? Spending on housing is up $234m on the Budget estimate. Does the Opposition claim that this is ill-directed either socially or economically? Assistance to industry is up $377m on the Budget estimate. Does the Australian Country Party deplore our assistance to rural industries? Does the Liberal Party denounce our assistance to private industry? The only criticisms are that the increased expenditure should have been greater. I have never heard a Country Party member criticise a single cent of increased expenditure on rural subsidies or assistance which we have declared since the Budget. I have never heard a single Liberal Party member criticise a single cent of additional expenditure we have provided by way of assistance to manufacturing industry or commercial enterprise. Sure, overall all the increases are irresponsible, inflationary and desperate! But every separate proposal which we make is said to be too little, too late.

Our payments to the States and for natural disaster relief are up $224m on the Budget estimate. Is this, including Darwin relief, an area where the Opposition would cut government spending? Expenditure on education is up $103m on the Budget estimate. Is this where the cut should be made? Defence spending is up $142m. Should this have been pared? There is, of course, one area of government spending readily identifiable, readily marked for the axe. That is the spending involved in the new programs instituted by this Government which are designed to benefit those Australians who have the least political leverage. They are programs which are politically dispensable because their beneficiaries are politically expendable. They are programs which are politically expendable. There is a ready made list of expendable programs- the programs imperilled by the High Court challenge by the Liberal Premiers on the constitutional validity of the Australian Assistance Plan and the Regional Employment Development Scheme. That is, the Federal Opposition does not have to be specific. But the State Liberal governments have challenged these matters in the High Court. The Federal Opposition- the Federal Liberals and the Federal Country Party -would be the first to say: ‘This is sub judice. You cannot criticise it in the Federal Parliament. Let our State confederates take these initiatives; we will condone them’. That is where they would make the cuts; that is where they would tolerate the cuts. They have not opposed any of these additional proposals or appropriations in the House of Representatives or even in the Senate. They do not oppose them federally, but they get the State governments to challenge them in the High Court.

All these programs benefit the relatively inarticulate or underprivileged in our community. They have a social and human value far beyond their financial cost, which in itself is relatively small compared with the great traditional areas of Government spending by the Commonwealth and the States. To cut them would have no significant economic effect, but it would make a gesture in the direction of those who demand cuts in Government spending. That lobby is vocal and’ well organised; the Australians who benefit under these programs are neither. I suggest that it is upon these programs and upon those who benefit from them that the Opposition would really like to see the great axe fall.

On the other side of the ledger, receipts are down by $307m on the Budget estimates. Why? Because of tax cuts additional to those made in the Budget. We have foregone a further $230m net in revenue from personal taxation and $105m in company taxation. Does the Opposition reject these concessions? It did not oppose them in the House of Representatives. It did not oppose them in the Senate. Should we have increased taxation to reduce the deficit? Should we have increased taxation to satisfy the dogma that deficit budgeting is intrinsically irresponsible?

If Opposition spokesmen will specify one area where a substantial reduction in spending should have been made, either on the grounds of economic prudence or social responsibility, then we might take more seriously their demands for reduced government spending. Yet, rather than do this, their complaints on specific issues imply not reduced government spending, but increased government spending. What else is the consequence of the demands by the Leader of the Opposition (Mr Malcolm Fraser) for increased defence spending, or by the Leader of the Australian Country Party (Mr Anthony) for even more generous assistance to rural industry than we are already providing ? The fact is that the areas where we have increased expenditure or foregone revenue are all socially essential and, in the circumstances in which they were made, economically correct. The expansion upon the September Budget has been the correct course for the circumstances in which it was undertaken. We have thus achieved not full recovery, but the chance for full recovery. The opportunity has been hard won. The Australian Government, like all responsible governments in comparable countries, has had to make difficult decisions and there will be a continuing need for more difficult decisions. But the important thing is that the opportunity all Australians have earned should not be lost. The fact remains that in 1975 the real danger of a resurgence of the rate of inflation and the real danger of a downturn in employment would come from wage demands greater than the ability of the economy to absorb.This is the real message that the Treasurer and I have tried to convey to employees and their organisations. The whole object of the personal income tax cuts, of our support for wage indexation and the substantial improvements we have achieved in the provision of health, education, public transport and community services has been to sustain and raise the real standard of living of families beyond that provided by the pay packet alone. Our object is to reduce the need for vast wage increases which individuals and families feel obliged to demand in order to chase rising prices and maintain their living standards. The Australian Government believes it is the more entitled to expect co-operation insofar as we have been successful in our efforts to raise real standards and real earnings for Australian employees, that is, for the vast majority of Australians.

Incomes of wage and salary earners have grown consistently faster than the cost of living since December 1972. Between the December quarter of 1972 and the December quarter of 1 974 the consumer price index increased by 3 1 .6 per cent; average weekly earnings increased by 46.8 per cent; average minimum weekly award wage rates for males increased by 53 per cent; average minimum weekly award wage rates for females increased by 75 per cent; real average weekly earnings, before tax, increased by 11.5 per cent; and real average weekly earnings, after tax, increased by 7.3 per cent. These figures further point to the basic strength of the Australian economy and the superior performance of our national policies in meeting the international problems of the world economy.

I shall give some key comparisons. Whereas in Australia real average weekly earnings before tax increased by 1 1.5 per cent in the two years, December 1972 to December 1974, in the United States there was a decline of 5.8 per cent. In the calendar year 1974 Australian Gross Domestic Product grew by 1.7 per cent in real terms compared with the preceding calendar year 1 973. In the same period there was a decline in the United States of 2.2 per cent; in Japan of 3.7 per cent and in Great Britain of 0.2 per cent. In West Germany there was a marginal increase of 0.4 per cent. In the Overseas Economic Cooperation and Development countries as a whole there was a decline of 0.3 per cent in real Gross Domestic Product in the calendar year 1974 compared with the preceding calendar year 1973. In Australia there was an increase in the same period in Gross Domestic Product of 1.7 per cent.

There is no suggestion in all this that the Australian Government is complacent but the figures do suggest that confidence in the Australian economy is well founded. The key to economic revival this year is the revival of confidence in the private sector. The measures taken by the Government in the past 9 months establish a good basis for that confidence. In September, November and January we took measures appropriate for existing and emerging conditions. We shall continue that approach, the approach of a responsive and responsible governmentresponsive to the needs of the economy, responsive to the needs of all sections of the community and responsible in making the decisions to meet those needs.


-The Prime Minister (Mr Whitlam) started off by saying that the measures that he announced in November would take a considerable time to take effect and we are now beginning to see the upturn. I do not know whether the Prime Minister has sources available to him which I do not have available to me, but I have in front of me the latest bulletin of the ‘Round-up of Economic Statistics’ of early April 1975, issued by his own Treasury, and I can see very little sign in it of any beginning of an upturn. Let me read from it:

The preliminary national accounts indicate that private growth fixed capital expenditure, seasonally adjusted and at constant prices, fell by 7.7 per cent in the December quarter; the fall over the year to the December quarter was 13.0 per cent.

Seasonally adjusted and at constant prices, private investment in dwellings is estimated to have fallen by 2.6 per cent in the December quarter, bringing the decline- decline, mind you- over the year to 1 9.6 per cent.

Investment in plant and equipment accounted for the bulk of the fall in private fixed investment in the December quarter. In seasonally adjusted constant price terms, investment of this nature is estimated to have fallen by 12.1 per cent in the December quarter following an increase of 7.2 per cent in the September quarter; there was a decline-

A decline again-

Over the year of 9.5 per cent.

Dr Edwards:

– That is what growth depends on.


– Yes. The value of private non-residential buildings approved in February at $47m was at its lowest level since January 1972. So one could go on. From where does the Prime Minister get this magnificent phrase, ‘We are now beginning to see an upturn’? All that I thought the measures that were announced in November did was to countermand the measures announced in the Budget, which we were told at the time were essential if we were to control the economy and bring inflation under control. In other words the plan that was spelt out in August was completely in tatters by November and the final nail was driven into the coffin in January of this year.

The Prime Minister said that the Labor Party certainly had been flexible. I will say it has been flexible. One only has to look at virtually every decision it has taken to see that it has gone back on its decision, after realising the disastrous effects it has had. The Government reversed its tariff decisions- its 25 per cent across the board cuts. The Government’s great idea was: Let us bring in as much from overseas as we can and you will get cheaper cars and cheaper clothing. Now, with the car industry and textile industry in considerable difficulties, it has had to bring in restrictions and the Government is flexible. I refer to the sales tax cuts and the superphosphate bounty. No one knows what has happened to the superphosphate bounty; one moment it is on and the next moment it is off again, then it is on again. Then the matter is referred to a special committee and we are to receive a report later.

The Prices Justification Tribunal was set up to squeeze prices, then suddenly we are told that profits are not necessarily bad; only excess profits are bad. Then there was the matter of the Reserve Bank deposit. First of all, 25 per cent of imported funds was to be placed, interest free, with the Reserve Bank. Then the amount was increased to 33-1/3 per cent, then reduced to 5 per cent. So one can go on. Foreign capital was quite unaccessible for any development of energy resources in Australia; now it is not necessarily unacceptable. The situation now is simply that when the resources are found they have to go to the Government. There was a devaluation at first, then another devaluation and then a revaluation. This is the most flexible government I have seen for a very long time because it does not really know where it is going.

The Prime Minister said that the balance of payments is satisfactory. Again, he may have sources available to him that I have not. However, when we left government, we handed over well over $3,000m of reserves, one of the highest reserves that this country had ever had. I find that the balance of payments on current account in the 1974 calendar year shows, in the March quarter, a loss of $241m; in the June quarter a loss of $5 10m; in the September quarter an even greater loss of $60 8m; and in the December quarter a loss of $440m. But the Prime Minister says the balance of payments is satisfactory. In our balance of payments in the last 12 months there has been a total loss of $ 1800m, but this is said to be satisfactory. So one could go on.

What has the present Government done? It took over an economy which was flourishing, a prosperous nation with virtually no unemployment, inflation running at 4.5 per cent and falling, interest rates moderate, business flourishing and confident, mining and oil exploration proceeding apace. Industrial turmoil was certainly present but it was being strongly contained and attacked by the then Government. What has this Government achieved after less than 2lA years of its mismanagement of the economy? We have the highest unemployment since the depression. We were told that the Australian Labor Party will not tolerate unemployment, yet today 27 1 200 are unemployed, the highest number since the depression. What an extraordinary thing it is that the Government has managed to cajole, duchess, blackmail or pressurise the Press into disguising this fact. I have in front of me a cutting from the ‘Sydney Morning Herald’- the same news item appeared in the ‘Age’ last week- which carries the big headline ‘Number of jobless continues to fall’. It states:

The employment situation continued to improve during March-

Of course that looks very nice but it goes on to state:

In seasonally adjusted terms, the level of unemployment rose by 1 1 7 10 to 27 1 1 6 1 , or 4.6 per cent of the workforce.

The person who wrote this must have been duchessed or cajoled. It continues:

This is considerably smaller than the February increase of 19 298-

In other words, it states that the position is getting better because the rate of increase is not as bad as it was- the increase was only 1 1 000 as against 19 000 in February. The article continued: . . . lending support to the Government’s claim that its efforts to stimulate employment are having effect.

I cannot see that the Prime Minister has any basis for saying that we are now beginning to see an upturn. We are beginning perhaps to see the upturn of the downturn- that is about all one can say. What has the Labor Party sought to do in order to contain these problems that are in front of it? As I mentioned, it has attempted to reverse the loss of confidence, the mounting unemployment and the stagnation by reversing some of its policies. It has set up the Regional Employment Development scheme. The Minister for Labor and Immigration (Mr Clyde Cameron) takes great pride in the fact that every month he is employing more people under the RED scheme. Surely it is an extraordinary attitude that because 5,000 more unemployed people are now employed under the RED scheme something really has been achieved. Look at the figures which were given to us in Appropriation Bill (No. 3). The amount for structural adjustment assistance, income maintenance, was estimated at $ 11m and it has gone up to $57m. In other words, we are now spending five times as much on income maintenance as the Government believed would be necessary for the financial year 1974-75 and which it made available in Appropriation Bill (No. 1 ). The same thing applies in the Regional Employment Development scheme. Expenditure on it has gone up three and a half times. We are spending this year $ 1 80m on employing people who would not otherwise be employed. One would not mind if the Government really was achieving something. That is the thing that worries me.

The Treasurer (Dr J. F. Cairns) said only yesterday that he will go on printing bank notes as long as he can find a productive job for them. Can anyone tell me that things like building a secretary’s office on a racecourse and building a 6Vi furlong track are productive? Is it productive to fence the Jindera Cemetery and to carry out maintenance on it? I am sorry I do not have further time to go through all the things being done which are completely unproductive. Why can we not adopt the system of planting forests, one which the New Zealanders employed during the depression? Those forests, are now bringing in vast sums of money. Why can we not go in for water conservation and road building? We are getting back to the old depression system whereby we paid people to move a pile of stones and then move it back again. I wish I had more time to answer what I was going to call the stupid speech of the Prime Minister, but perhaps to call it that would not be parliamentary. There are so many other points one could answer but I thank the House for the opportunity of at least saying a few words.


-Since I have been in this House I have been constantly astonished to find that before Opposition members rise to speak on a Bill they never manage to find out what it is about. Consequently they speak on everything bar what is contained within the Bill. It must be terribly confusing for those who listen on the radio to understand what we are talking about. Honourable members opposite never speak constructively. I have never yet heard them set out their policies for dealing with the unemployment or inflation that we are experiencing at the moment. Their contribution is always on the negative side. It is carp, criticism and reiteration, and I must say that I find it extraordinarily boring. Listening to Opposition speakers, one would imagine that the Australian Labor Party invented unemployment, but I remember the days of 1951, 1961 and 1971 when they were the Government and there was heavy unemployment. Their track record in care for the unemployed is deplorable and would remain deplorable if they were ever returned to office.

The unemployment benefits under the present Government have been substantially increased, and rightly so, as the genuine individual should not be disadvantaged when he is out of work. Is this where members of the Opposition will economise if they ever get back into Government? Will we once again have that pittance called unemployment benefit handed out to people, and the unemployment benefit for juniors which was always looked upon as pocket money? Will they cut out the grants to voluntary organisations that are contained within the Bill we are discussing, which have not been mentioned yet by anyone who has spoken on the Bill? Would they like this Government, or do they intend, to cut out grants that have been made to the handicapped and disabled, to the Brotherhood of St Laurence, to the Australian Council of Social Services and to the Australian Council for the Rehabilitation of the Disabled? Is this where the guillotine will fall if the Opposition is ever returned to Government?

Last year the Deputy Leader of the Opposition (Mr Lynch)- he has remained Deputy Leader although the Opposition has had a couple of leaders since- spoke of an 8 per cent cut across the board except in defence, where he intended to make increases. I believe also that he intends, with the support of the Australian Country Party, to reintroduce the subsidy for superphosphate. Those are 2 inceases. Where then will members of the Opposition have the cuts, or where do they want us to have the cuts? They are constantly calling for increased subsidies for wool and beef and it is worth having a good look at where they traditionally make the cuts. It is in the field of social security; it is where pensioners are concerned. I well remember the years when a 50c increase was the norm, when $ 1 was a windfall, and when, in some years, all that pensioners got was sympathy. Do Opposition members want the Government to cut down its pension increases? Is this one of the areas where they are scheming to have a cut in government expenditure? They did it for many years so do they want us to emulate them? Will they cut down on pension increases if they ever hold a leader long enough to regain office by winning an election? I think pensioners ought to beware. I believe that their incomes would be extremely vulnerable on the return of a Liberal-Country Party Government. I speak as one who was a pensioner under the Liberal-Country Party Government, and with very little gratitude.

If honourable members opposite had fulfilled their responsibility to education during their many years in office, the problems facing this Government when it came into office would not have been so enormous. If the Opposition, when it was in Government, had cared for the students in the government and parish schools in the same way as it did for those in private schools, we would not have been faced with such tremendous expenditure. We make no apology for our expenditure in education, and we do not intend to cut it. Would the Opposition want us to economise here? Are we to return to the dark days of despair in education when they were the Government? After 2 lh years of a Labor Government we are now seeing some of the results of our expenditure on education. We might even see more results if the non-Labor States care to co-operate and spend the money this Government has given them. They lag far behind the non-government schools in spending their grants. The Opposition, when it was the Government, starved and neglected the education system over numerous years. Schools are just starting to blossom. Are we to cut them off again? Parish schools for the first time for years are able to face the future with some satisfaction and with some sense of fulfilment.

Does the Opposition want to abandon the expenditure for assistance to handicapped children? Does it want to abandon moves we have made to expand the war service homes loans and to make increased loans available at low interest rates? Shortly this Government will be introducing legislation to abolish the means test for the 70 to 74 age group. Is this the group the Opposition would have us disadvantage? Various other things in this Appropriation Bill have never been mentioned. There is the subsidy of $4 for $ 1 for establishing sheltered workshops for handicapped adults, training centres for handicapped children and hostels for handicapped children. Is this an area that we can do without?

We are also introducing a 50 per cent subsidy for approved staff to assist hostels and sheltered workshops to improve their staff ratio. That surely is not an area that even the Opposition would want us to cut out. The double subsidy applies not only to sheltered workshops but also to a whole range of prescribed services. Where new ventures are being established the Australian Government will provide 100 per cent of the salaries to help with the establishment. They could not get going without it. Do honourable members opposite want us to cut out those sorts of things? In any case, why da not members of the Opposition when they speak of these cuts in Government spending be a little more specific and tell us in which areas they want us to cut grants? I think that every time they stand and speak of cuts in government spending they make the recipients of social security feel uneasy and threatened. Let them lay down specific cuts that they intend to make and cease the negative carping.

Perhaps it might be an idea also if in future members of the Opposition speak to the legislation before the House instead of consistently bringing in debate on inflation and unemployment. Of course we have heavy unemployment and of course we regret it, probably more than do members of the Opposition. Of course we have inflation but so has every other comparable Western country. But we will not cure inflation by sitting here in Parliament criticising it. We need to put forward policies to gain the confidence of the business community and hold the confidence of the people of this country. I think that many honourable members who are in this House supposedly to represent electorates are far too intent on pushing their own barrows. They forget the people who put them here to serve them.

Sitting suspended from 5.57 to 8 p.m.


-We debate these Appropriation and Supply Bills in a remarkable atmosphere. Although the Opposition does not deny them passage it must be understood that we have the gravest reservations and misgivings about the appropriations of this Government particularly when in the Parliament this week we heard the Treasurer (Dr J. F. Cairns) telling us that the Government might well proceed to go on printing masses of new money. In the same answer he indicated that this should make no contribution to inflation. The Government indicated that there would be no cutback in Government expenditure but that it could very well increase. It has said that it will honour the promise to cut taxes and that the mounting deficit will be sustained, if necessary, by uncontrolled printing of money. And the Government says that that is not inflationary! I must say that that is the queerest economics I have yet encountered. We have a very deep concern about these Appropriation and Supply Bills. The Prime Minister (Mr Whitlam), the Treasurer and, I think, every speaker from the Government is trying to get the Opposition to do the job for them. The Government is pleading with us to tell it where to cut down its expenditure. Who on the Opposition side would not be worried when we see the extravagance and wastefulness of this Government.

Yesterday we read in the newspaper that the cost of the upkeep of the Prime Minister’s official garden is $204,000 a year. I do not know what he grows in that garden but one thing I do know is that for far too long he has been leading this nation up the garden path, or perhaps it is along the primrose path of dalliance. Would we not be worried when we read that the overseas junkets will go on. Apparently there are still some ancient ruins in Peru which, in the national interest, must be inspected. Would anybody not be worried about granting Supply when I have received undisputed evidence from a very small Commonwealth Employment Service agency that the following are some case hsitories of the clientele which regularly draws unemployment benefits. There is a Norwegian journalist from Holland who has been receiving benefits for 12 months but who now has returned to Europe after a pleasant holiday in Australia at the taxpayers’ expense. An engineer-technician from New Zealand has been enjoying the seaside air since August at the expense of the Australian taxpayer. He was asked why he left his job. He said that he just wanted to change jobs; he just wanted a change. A boy from a southern State has been receiving benefits for over 6 months. When asked why he left Tasmania and his job he said that it was too cold in Tasmania. The officer asked: ‘Have you looked for a job recently?’ He said: ‘No, why should I?’

A man who sold his business and who is reputedly at the golf club most days, staying at the bar later than most, speaks of his benefit affectionately as his drinking money. A 6-foot, strapping man disposed of his business and lives at a beach front unit. He pay $45 a week for it and cheerfully fronts up with his forms for benefit. There is a man who states he is travelling around Australia until he finds a suitable spot to establish a new religion. There are Canadian, American, English and New Zealand itinerant girls and boys whose reason for leaving their short-term jobs is because they want to live by the surf. Some types give their address as the local surf club. Some clients deposit their benefit cheques at the same time as they deposit cheques from builders or other employers into their fat bank accounts. A cafe proprietor in the same area overheard people boasting that they were registered at different places and that they draw two or more cheques. Because this is an area where specialised and, indeed, any employment is unobtainable, it is known that shrewd sun and surf lovers in other States register for unemployment in their own State and ask for the benefit to be paid at some of the finest coastal areas in Queensland.

There are applicants whose job requirements are listed as bookbinders, gymnastic instructors, electrical engineers and such jobs which could not possibly exist in the area. Is that why we are granting this Government Supply and Appropriation? These are actual case histories supplied to me by an agent in one very small office of the Commonwealth Employment Service. I have been told, too, that the Regional Employment and Development scheme was probably the best thing that ever happened. At least some of the malingerers can be purged off the rolls. When they were advised that they were needed for a RED project a number of them stated that, coincidentally, they had just obtained a job or, coincidentally, that very day they had arranged for an appointment for an interview for a job. This is proof positive, I think that they had a job all the time and that they had been getting unemployment benefits too. Yet for how long in this House did we tell the Government that that sort of thing was going on before it belatedly admitted this? True it is that now the clamps are on. But what a shemozzle it has been. The Government asks us where it can cut Government expenditure. Extravagance and wastefulness are the mark of this Government. Why should we not be concerned at these Appropriation and Supply Bills and at the massive deficit which is the record of this Government?

As I thumb through the speech of the Minister I come to the heading of ‘Post Office’. I do not oppose the futher $127m for the Post Office to meet unavoidable cost increases, but the next sentence is intriguing. The Minister states:

This will maintain the Post Office program at the level envisaged at Budget time.

My word, we will not oppose that because, at all costs, we must maintain the Post Office. We certainly cannot let it deteriorate any more. In my home area which is 60 miles from Brisbane on the main highway in Queensland and on the main northern railway line, it is usual for mails to take from 3 to 7 days to traverse 60 miles or less. In some areas telephone services are absolutely abominable, yet the charges are astronomical. Even farmers find that they are now classified as businessmen and, because of this, up go their rentals to business rates. Yet, it is essential that we allow that to pass because we want to maintain what we have, shocking as it may be, for heaven help us if it deteriorates any further.

It is in this series of Bills that an appropriation of $335m is sought for Medibank. If we are to believe the Minister we may be broke, we may be nationally bankrupt, but if we have the stamina to queue up for treatment we will at least be healthy. What concerns us so deeply when we talk of appropriation is the massive- I believe it is at least $ 1.5m- splurge of taxpayers’ money for advertising by the Minister for Social Security (Mr Hayden) and his Department. This has not been spent on essential information. It has been entirely a massive, indefensible political exercise. Its design is not to inform but to denigrate the health insurance funds which have served this nation so well for so long. The medical profession is rather concerned about the changes which it regards as gravely undesirable because of the doctor-patient relationship. It could be regarded as misinformation because, for all that the Minister tells us about free health care, the lack of necessity to continue insurance with a private health insurance fund and the guarantee of treatment by a doctor of the patient’s choice, the answer from the Minister for Health (Dr Everingham) in this House during question time this morning shows how heavily qualified those assurances really are. But those qualifications and conditions do not figure in the Department’s expensive advertising campaign. Well, Medibank has already had a tremendous benefit. In fact, it has been a bonanza to radio, Press and television which have been swamped with advertising.

This Government should realise very clearly, too, that when it talks about the food aid program which is also mentioned in the Minister’s speech, that it will be able to provide nothing at all if the primary producers do not get some consideration from it. I include in this criticism the Minister for Northern Development and Minister for the Northern Territory (Dr Patterson) who got so stirred up in the House this morning. We hear a lot of rumours about his splendid speeches and heartrending pleas in Caucus, but we never see or hear him in this House which is where it counts. We never see him doing anything but supporting the anti-rural Government with his vote and his voice. We hear him mouthing the Government spiel. By doing that he condones the Government’s action, no matter what he says in any other place. Nor will we be able to play any national role in providing food for hungry nations if this Government continues to undermine and to destroy our primary producers by allowing considerable imports of canned pineapples, canned mushrooms, canned mangoes, canned citrus, citrus juice concentrates, potatoes and potato products, onions, frozen fruit and vegetables and synthetic products to take the place of our passionfruit industry. That practice builds up stocks and gives processors a unique opportunity, if they want to use it, to beat down the price paid to the local producer. Then the Government says that inflation is coming down because the consumer price index is no longer rising. The reason that it is no longer rising is that food prices are falling. So once again the primary producer is the bunny. Once again he has to pay the price. His solvency and his right to a decent standard of living are of absolutely no concern to this Government, in spite of all its undertakings in the United Nations food aid program.

Mr Speaker, I would like to say much more. Unfortunately we have agreed to curtail our remarks so that other honourable members can speak in the debate. But what a Mad Hatter’s party this Australian Government has become. Grandly at its head struts a Prime Minister who in this House assured us that he is the greatest, and he has a deputy who regards the printing press as man’s greatest invention. I conclude where I began: We will give these Bills passage, but we express here, as we have expressed consistently in the past, our concern and our condemnation of the irresponsible management and incompetency of the Government which is intent on sparing no expense to retain office, even if it has to take over every printing press in the nation to keep up the supply of money.


-There was a time when people in this country regarded the democratic system as one under which they were able to choose between two clearly delineated bodies of policy, between two clearly delineated sets of proposals. How sadly they must have been disappointed upon listening to today’s debate and realising how little of a positive nature Opposition members are willing to put forward when they bring before the House for discussion the economic situation in this country. How staggeringly bankrupt it is for a senior member of the Opposition, a front bench member of the Opposition, such as the honourable member for Fisher (Mr Adermann), to get to his feet and call upon the Government to make cuts in public spending and have no better examples to bring before the House than the overseas travel and gardening of the Prime Minister (Mr Whitlam). As if either of these aspects of expenditure are new to the Australian Budget. As if either of them aggregated would make the remotest contribution to the cause the honourable member for Fisher purports to argue.

But the bankruptcy of Opposition members in this area of putting forward positive proposals for the economic wellbeing of Australia is not really as depressing as their absolute inability to acknowledge the value-indeed, the indispensability of flexibility in any effective program of economic management. Although the Leader of the Opposition (Mr Malcolm Fraser) argued this afternoon that tariff cuts, revaluation of the Australian dollar and restrictions on capital inflow are not appropriate in today’s economic climate, that does not mean that they were necessarily inappropriate when they were implemented in 1973.

Let me recall to the House, not for the purposes of recrimination but simply so that particular sets of economic proposals can be put in their proper economic and historic perspective, the situation as it existed in 1973 when the measures criticised this afternoon by the Leader of the Opposition were introduced. Let me remind the House that in the course of 1972 the money supply in this country underwent the greatest expansion since Federation. That was not a factor which occurred in isolation. At the very same time that honourable members opposite were indulging in the practice for which they now so fiercely criticise the Deputy Prime Minister and Treasurer (Dr J. F. Cairns)- namely, a rapid increase in the money supply- capital inflow into this country was at an unprecedented level. In the course of a 12 month period there was a capital inflow of $2,000m. Then again, at the same time, we had a currency which was notoriously undervalued, which was itself enabling overseas buyers to snap up our primary products- the products of the farms, the products of the mines- at bargain prices with undervalued Australian dollars. As a result of those 3 factors working one with the other we had the classic demand inflationary situation- too much money chasing too few goods.

What were the measures that the Government devised to meet that situation to ensure that there were products on the shelves of the shops which people could buy with the money they had in their pockets? We took effective action to step up the supply of goods. The tariff cuts are properly seen in that context. They ensured that at a time when Australian manufacturers were unable to meet the demands of Australian consumers goods from overseas could come into this country at competitive prices. The effect of the revaluation of the Australian dollar, which was much criticised by honourable members opposite, had the same effect in that again goods that Australian manufacturers could not supply to meet the demands of Australian consumers could come in from overseas at competitive prices and in that at the same time it prevented the continuation of the bargain basement sale of Australian products that were needed by the Australian community. Those were the solutions appropriate to a phase in our economic affairs of demand inflation. We are now being criticised by honourable members opposite as if those measures had been implemented at a time of cost inflation, at a time when demand pressures in the community, far from being excessive, were in fact deficient.

What was the situation that took over? As prices were forced up in the competitive auction for products and people were willing to pay inflated prices in order to get possession of goods which were in short supply, inevitably at the same time employees’ organisations were bound to push for higher wages, higher salaries, in order simply to maintain their purchasing power and to ensure that they could buy as much at the end of 1973 as they had been able to buy at the beginning of the year. So it was that as the demand pressures eased off we still had the inflationary situation arising from these cost pressures. Thus there is no inconsistency- this afternoon the Leader of the Opposition argued that there was an inconsistency- between the Treasurer saying at one time that inflationary pressures in this country had been generated by problems of demand and the Prime Minister saying at another stage in our inflationary cycle that those pressures were generated by costs. These are 2 aspects of the same problem, and it seems to me to be enormously regrettable that Opposition members cannot seem to enlarge their perspective to take in that fact and to acknowledge that solutions to economic problems which may be appropriate at a particular point in the trade cycle may be inappropriate at another point in the trade cycle, and vice versa.

In his speech this afternoon the Leader of the Opposition had something to say about the selfishness and greed which he believed had been encouraged in Australia over the last 2 years. I agree with the Leader of the Opposition to the extent that I agree that selfishness and greed have a great deal to do with our economic problems at the present time. But these are not new features of Australian society. These are not qualities in the human personality which have come to light in the last 2 years or, indeed, which have been greatly stimulated in the last 2 years. The Leader of the Opposition was right this afternoon when he said that our community was a victim of excessive expectations but he was wrong when he blamed those expectations on the Government. It is true that Australians have been led to expect more than the resources of the community can possibly be stretched to provide for them but, overwhelmingly, that process of creating excessive expectations has been carried on within the private sector of the economy by the greatest of all demand producing pressures in our society- the advertising industry.

It is not too high a quality of school, it is not too high a quality of health care services, it is not too high a quality of public transport, it is not even too much attention to salvaging what is left of our natural heritage which Australians demand, but a house which is finished and furnished too quickly, a car which is replaced too frequently, or literally thousands of products for which no need would ever have been recognised if it had not been invented. I cite my own case. When I was newly married and moved for the first time into a house of my own it was a weatherboard box of 10 squares, bare of furniture, uncarpeted, with no garage- the simplest form of accommodation that one could imagine. Over the years that house was extended to accommodate children, was furnished, acquired a garage and a garden. My children and their friends expect that they will move into the whole shebang instantly. They expect that they shall have a three bedroomed brick veneer fully furnished house with a garage outside and a car in the garage.

The expectations which have been excited in this country, which outstrip the resources of this country, are overwhelmingly in the private sector. They are expectations fanned and exacerbated by the advertising industry. It is not too good a quality of school, it is not too good a quality of health care, it is not too good a quality of public transport, it is not the environmental concern, it is not those things on which overwhelmingly this country or this Government has spent money in the last 2 years which Australians demand, but a thousand and one frivolities for which demand has been invented or magnified in the most cynical way.


-These Appropriation Bills and Supply Bills deal in part with the allocation of funds for the Department of Defence. The finance sought under Appropriation Bill (No. 5) is to cover payment to Papua

New Guinea for the purchase of defence assets, salaries and pay, and to cover general price increases. It is a worthy enough request but one which I fear the Government submits without any degree of enthusiasm for the defence problem. Regarding general price increases, the statement made yesterday by the Minister for De- . fence (Mr Barnard) that in 1971-72 the defence allocation was $ 1,200m and that this financial year, 1975-76, it will be $ 1,800m, leaves me cold. The allocation for defence will have to be greater than that to meet the escalation of costs. In fact the Government is hardly increasing the defence vote at all; it is only trying to keep pace with rising costs.

It is common knowledge that our defence capacity is of grave concern to the people of Australia because this Government has allowed it to run down at an alarming rate since it took office. What we should be doing is debating an Appropriation Bill, for many times the amount that is presently requested, aimed at attempting to restore our defence creditability. In the report of the Senate Standing Committee on Foreign Affairs and Defence there is a paragraph which states:

It would 6e in Australia’s interests to support Papua New Guinea in the event of an external threat to that nation’s security.

If this Government persists in allowing our defence capacity to deteriorate at the present rate we could finish up with a capacity inferior to that of Papua New Guinea.

In order to curtail expense in the area of defence this Government has reduced the training flying hours of our operational aircraft, it has reduced the sea-going time of our naval vessels and it has allowed the Army to continue using outdated and outmoded equipment. If the Government is so keen on saving money in this area I suggest that it do away with half of the civilian empire it has allowed to build up in the Department of Defence. It would be most interesting to know the present ratio of civilians to Service personnel in the Department today. The report from the Senate Standing Committee which I mentioned previously states:

Over the last few years, the percentage of defence funds available for equipment procurement has declined. In the case of the Army vote, for example, the proportion allocated to acquisitions has dropped steadily from 2S.S per cent in 1968 to an expected 10.2 per cent this year.

The Committee is quite right when it views this with disquiet and recommends that defence expenditure be increased to replace ageing and worn equipment and the introduction of new weapons to meet operational requirements.

These are not my words; they are the words of the Senate Standing Committee on Foreign Affairs and Defence. From evidence presented to the Committee it is apparent that increased expenditure on arms and equipment could be justified. Yet we have no request for additional funds for this purpose in these Bills. I presumerather, I hope- that the Government intends to do something about this matter in the Budget allocation but in the meantime the Services are supposed to soldier on with what they have.

The Government does not appear to be concerned about the time lag between ordering equipment and its delivery. In fact it appears as if the operational state of our forces does not concern the Government one little bit. I see no request in these Bills for funds to assist the Army Reserve. Again, the report I mentioned states:

The reserve forces are of fundamental importance to the nation’s overall defence capability. . . . Most reserve units are scarcely viable at the present time.

Surely, in view of the Committee’s report, which the Government has had for some time, this Reserve needs financial assistance and needs it now. I would have thought, in view of the present Asian situation, that this Government would have become a little more defence conscious and sought funds to bolster our defence capacity as soon as it possibly could. By that I do not mean that the Government should be pushing panic buttons but it should have some regard for the time factor involved. I hope that the Government will give the needed consideration to a much greater defence allocation in this year’s Budget. Even if it does, it has lost the advantage of a 4-month period, which means a lot, between the time of ordering and the time of delivering by not requesting such funds now.

I also note that in these Appropriation and Supply Bills $15m is sought to meet increased requirements for advances under the Defence Service Homes Scheme. This is to meet the increases in loan moneys and the liberalisation of eligibility conditions. I have no quarrel with that request but I question the fact that the request for supply to continue to finance defence service homes satisfactorily was not made prior to this time. I say this because I believe that the Government has been negligent and completely irresponsible in this matter. Only this morning I was informed that the Queensland branch of the Department of Housing and Construction had run out of money to lend for the purchase of defence service homes. I believe that it is informing applicants that authority will be granted quickly to the applicants to obtain bridging finance from the banks until such time as the Department obtains enough money to take over the mortgage. What a magnificient gesture this is from the Government. The Government is committing its current applicants for service homes loans to 1 1% per cent or 12 per cent interest rates instead of the normal 3% per cent interest. There are applicants for loans who have received approval to build and have had their dwellings half completed. They are now being told to apply for bridging loans. What will happen if these people cannot meet the heavily increased interest rate commitment? What will happen then? Will the building be left half finished or will the builder have to wait a further couple of months or more for payment? Already there are applicants who have been waiting since early February for payment. The big question is how long the administration will take to get more finance into the service homes loan pipeline. I believe that the Government should be severely chastised for the fact that there is no more money available for war service homes loans in Queensland and for allowing this situation to occur. Of course, the problem could be overcome quite easily if the Treasurer’s advice were accepted and more money was printed in a hurry. After all, the only additional costs involved would be the cost of paper, ink and a bit of oil.

I question again the fact that there is no request in these Bills for finance to construct more married quarters for Service members. I hope that it is not because the Government thinks it has sufficient finance to cover the present needs in that area or that there are sufficient quarters at the moment. If that is so, I suggest that the Government has another look at the situation and does it quickly. The report from the Senate Committee on Foreign Affairs and Defence, to which I referred previously, states that the Committee is disturbed about the current quality and quantity of Army housing, and there is no doubt that there is a serious shortage of married quarters in a number of areas. In fact, 26 per cent of serving soldiers are actually on the waiting list and it is possible that a soldier may wait 2 years before being allocated a quarter, especially if he is on a low priority. I know that each year funds are sought to cover the personnel on temporary rental allowance to assist them in meeting rents on private houses, but this should in no way detract from the urgency of the need to build more Service quarters. I am also aware that the Government plans to overcome this housing deficiency over a 5-year period, but in view of the fact that this shortage is of such considerable importance I would have thought that the Government would have sought some finance to commence the scheme as soon as possible. I am also aware that some married quarters, mainly those constructed prior to 1966, are regarded as sub-standard and that a program of upgrading has been commenced. But there are still a great number which are regarded as unsatisfactory and there is an urgent need to upgrade them. Again, I would have thought that the Government would have given this matter high priority and requested funds to keep the program going. If it made a sufficient allocation for this purpose in the last appropriation, I would suggest that the upgrading program has become bogged down and would be worth while investigating; that is, if the Government intends to improve the conditions for Service personnel, and who knows that?

Under the terms of the Commonwealth-States Housing Agreement, the Commonwealth advances money to the State housing commissions for the purpose of constructing dwellings for rental to serving members of the defence forces. There is nothing wrong with that situation, but has the Minister for Defence (Mr Barnard) or the Minister for Housing and Construction (Mr Les Johnson), or any other Minister for that matter, ever seen a suburb of housing commission homes that have been allocated to serving personnel? If they had seen them and taken some notice I think they would have wanted more value for Commonwealth funds. There is a sameness about these homes that is depressing. There is practically no relief in the designs, nor is there much relief in the colour scheme. The houses are built so close together that it is difficult for a family to obtain much degree of privacy. But the present Government is not solely to blame for this; previous governments must also share the blame. But I do hold this Government responsible for allowing the practice to continue. If the Federal Government is prepared to allocate funds to State housing commissions for Service housing then surely it is high time it insisted on a variety of designs to eliminate the distressing monotony of designs that exist at the moment. At one time I produced to the Minister 20 different housing designs that could be utilised in the construction of Service quarters, all for the same price that is being paid at the present time, but the designs were not accepted because the State governments would not accept the different designs. Surely we can lift our thoughts above the tented encampments, where all the tents are the same, all tents are in line and equal distance apart? In fact, the Minister would be doing the Service personnel a great favour if he insisted on variety in housing for future construction.

I mentioned that over one-quarter of our Service personnel are awaiting quarters. Now is the time that the Government should be requesting funds to speed up its program of building, especially when unemployment is so high and tradesmen are looking for work. The Government is asking for $22m for food aid, $43m for the Shipping Commission, $335m for health insurance, $33 m for Darwin compensation, and so on up to $2,600m. But not $ 1 is being sought to relieve the requirements of Service personnel for married quarters. I sincerely trust that this Government will have sense enough to look at the problems that I have presented tonight and rectify them in the annual Budget.


-The previous speaker dealt with the question of defence homes, and he was the exception rather than the rule because most of this debate has centred around the Government’s economic policies. He also alluded to the misapprehension that the Government is printing money. This is the latest confidence trick that the Liberal Party is trying to float around Australia. In fact what is happening is that the Government is running a domestic deficit of about $ 1,900m. It is pretty much the same as the deficit which the previous Government ran in 1972 during the days of Prime Minister McMahon and it is a deficit which we have seen on a number of occasions over the last 20 years. One of the astonishing things about the management of the Australian Government’s affairs is that the quite disproportionate amount of money which the Commonwealth of Australia collects is paid through its revenue, through its Budget, into capital works. Australia is peculiar in the Western world for financing so much of its capital works from revenue. If capital works were excluded, these deficits would not show up in the manner in which they do. -Suffice it to say that the reason the deficit exists is to endeavour to reflate the Australian economy. I will not recount the details of the speech made by the honourable member for Casey (Mr Mathews), who canvassed the economic mismanagement of the former Liberal Government in 1 972.

Honourable members would have heard many speakers in the House in the last few weeks espouse the cause of Milton Friedman about economic management, but what they did not say was that he also said that mismanagement of the exchange rates took 2Yi years to show up in the figures. It is because the Liberal-Country Party Government mismanaged the exchange rate of Australia that Australia has found itself in a dire inflationary position, and because of an endeavour by this Government to correct and manage demand inflation the economy went into a downturn. We have reflated it and at the moment the reflation cost is $ 1 ,900m. Perhaps it is a gamble the Government should not have taken, but I believe that unemployment has a more important priority than inflation in the immediate term and if unemployment can be corrected with a deficit of this nature then I think it ought to be corrected.

The thing that all parties in this House do not say is that every year the tax burden on the people of this country is increasing. The Liberals never mentioned it when they were in office. We criticised them for it when we were in Opposition. We are just as guilty as they are for leaving the tax scales exactly and precisely where they were during their tenure of office. This week I turned up an interesting publication, namely, the monthly report of the Australian Industries Development Association in which was a table which I now seek leave to have incorporated in Hansard.


-Is leave granted?

Dr Edwards:

– I have not seen it.


– Its incorporation has been agreed to.

Dr Edwards:

– Is that so? I am sorry.


-There being no objection, leave is granted. (The document read as follows)-


– The table shows that the average rate of tax on an annual income of $6,000 is 16.7c in the dollar. It shows that the application of a 20 per cent increase in the cost of living would give a taxpayer presently on $6,000 per annum a net income of $5,000. The table also shows that with such an increase a person’s tax rate would move up from 16.7 per cent to 20.4 per cent. As a result of the 20 per cent increase that such a person is given he gains only $732. If that were graduated back to the basic rate or held back to a base rate or if the tax scales were indexed, as I believe they should be, back to 16.7 per cent his take home pay would increase by $266 a year or $5.50 a week. Similarly a person in receipt of an income of $ 10,000 a year who had a 20 per cent inflation rate applied to his wages would, if the tax rate were held back to 27.8 per cent instead of going up naturally to 31.8 per cent, be $434 a year or $10 a week better off. Those are significant amounts that are being channelled into the public purse for no other reason than that there have been increases in wages to compensate for inflation. They are taken by the Commonwealth of Australia, through its progressive tax system, and finally end up as Commonwealth revenue.

One can take the position of someone on a salary of $ 10,000 a year who receives an increase of 20 per cent in his salary, which would be of the order of about $38 a week. It is normally taxed at 27.8c in the dollar on the average rate, which would leave him with about 72 per cent of the increase. Such a person would find that after an increment in the tax rate he is being taxed at 52c in the dollar, leaving him with only 48 per cent of the increase. So of the $38 a week increase he has been granted he retains $18 and $20 goes to the Commonwealth. But the employer must pay the full $38. He cannot say: ‘Eighteen dollars is for the employee and $20 is for the Government. So I will not pay the Government its proportion; I will only pay the employee’s’. The employer has to pay the full $38. By the time he takes into account superannuation, annual leave and all the other considerations the employer is in fact paying something like $48 a week extra. To gather that money into his own accounts in order to pay the increase he must charge more for his goods and services. Once his prices move upwards the man who gets an increase of $ 1 8 a week clear can see a diminution in his standard of living. So he applies subsequently for a wage increase to cover the extra costs that his employer had to add to his prices to compensate for the previous wage increase. The result is that the stupid position arises in which the tax system robs people of a percentage of their real income with every wage increment they receive.

I have had a table prepared by the Parliamentary Library which shows that in 1954-55 a taxpayer on the then average earnings of $ 1,799 per annum paid 5c in the dollar in tax and that today the same man doing the same job is now, just through a natural increase in wages, in receipt of $7,500 a year and paying 16.8 per cent of it in tax. In other words there has been an increase from 5 per cent to 16.8 per cent in the tax paid by a person in the same occupation. In the last 2 years in which inflation has started to take off rather rapidly- since 1972-73- the increase in the marginal rate of tax has been 8c in 30c- in other words, an increase of about 26 per cent. If one applies that to the average rate of taxation one finds that there has been an increase of about 2.7 per cent in 14 per cent or about 19 per cent. So that the man in receipt of average weekly earnings has suffered an increase in his tax rate of about 19 per cent- in 2 years. I also seek leave to have that table incorporated in Hansard.


-Is leave granted? (The document read as follows)There being no objection, leave is granted._


– Many members of this chamber pay lip service to the problem of inflation. The Liberal and Country Parties have now adopted a holier-than-thou approach to it. They were in office for 23 years but did not vary the tax scale significantly.

Dr Edwards:

– Inflation was running at a much lower rate.


– There was inflation in 1951. Many of the problems which are now being experienced showed up at different periods in the 20-odd years in which the Liberal-Country Party Government was in office. Honourable members opposite never attempted to index taxation. The failure to index taxation or to do something on an ad hoc basis annually with the tax scales is the measure of many people engaged in politics, particularly in this Parliament, who want unlimited funds and resources to be placed at their diposal for programs which they believe- they are perhaps well motivated in their beliefs- are in the public’s interest. I believe that there should be a more honest assessment and collection of taxes in this country. We all know that every day wages go up taxes also go up. I have had another table prepared for me by the Parliamentary Library- a very interesting one- which shows that in 1972-73 the collection from individual income tax was$4,090m and that in 1973-74- in one year- the taxes collected increased by 34.2 per cent to $5.49 billion. In the following year they went up by 45 per cent. The Commonwealth’s collections rose by 45 per cent in one year from $5.4 billion to $7.96 billion. I have had this table taken out on the basis of an indexation rated back to the average weekly earnings. It shows that if one applies the average weekly earnings increases to our tax scales the collection in that year would have been 19.8 per cent as against the 34.2 per cent which in fact took place and that in the year that followed- that is, 1974-75- the increase would have been 24.5 per cent as against 45 per cent, and the deficit which naturally we would have run in that situation would have been $1.8m billion. The individual PA YE tax is a major component- about 45 per cent- of the Commonwealth’s receipts. If one looks at that $1.8 billion deficit and applies it across the board to the Commonwealth’s total receipts of $15.7 billion in the current year one will find that the reduction is only of the order of about 1 1.5 per cent. So if we were to index taxation back to the average weekly earnings- in other words, if we were to index the brackets each year back to the average weekly earningswe would end up with a healthy increase of about 25 per cent this year and probably something of the order of 30-odd per cent next year and would suffer an overall reduction of something like 1 1 per cent in revenue. Given that we are in an unusual situation- we have the Regional Employment Development scheme in operation and are making extra payments for various social welfare benefits- there is no way in which this Parliament could not survive on a natural increment in its receipts of about 25 per cent. But who is to say that we can suffer this 45 per cent burden any longer? If we were to leave it go what we would end up with is everyone on the maximum rate of tax in about 15 years from now. A man on the minimum wage in Australia in 15 years from now would be on the maximum rate of tax. The Australian electorate would cop it no longer. I think that every honest parliamentarian should say: ‘Enough is enough. We should do something about taxes’.

Opposition members- Hear, hear!


– The present Government has set up the Matthews Committee, which will be bringing down a report in the near future on taxation. I hope that it will mention tax indexation. I heard honourable members opposite say ‘hear, hear’ to my earlier remark. When the Government of which they are supporters was in office it did not do anything. It would not set up such a committee. It provided for a few miserable cuts in taxation, but nothing across the board. If what I have suggested were to be done we would be back to a reasonable, sensible basis and a man would be able to apply for a wage increase and not have his pay packet robbed by the progressive tax scale as it operates at present on inflated pay packets. If that is stopped, it means that the employer does not have to put a massive amount into the next price increase, which of course is then chased by organised labour seeking higher wages. I believe that taxation is a significant inflationary factor in this country. I do not believe it; I am sure of it. I think that -

Dr Edwards:

– We have been saying that for the past 1 8 months.


– You never said that. Honourable members opposite are hypocrites. They had 23 years to do something about it but they did not do anything. They have never mentioned this. The only people who have really thought seriously about tax indexation or tax relief are honourable members on this side of the House. I believe something will come from it. I seek leave to have this last table incorporated in Hansard. It is an interesting one and I do not think it has ever been prepared before.


-Is leave granted?

Dr Edwards:

– I do not think I have seen the document, but judging by the drift of the honourable member’s argument, which supports the views of honourable members on this side of the House, I think it may be incorporated.


-Leave is granted. (The document read as follows)-



The table below compares actual personal income tax collections with hypothetical collections which would have resulted from using tax rates related to the increase in earnings of taxpayers. As a revised taxation scale was introduced in 1972-73, that year was chosen as the base and taxation collections were computed using the increases in average weekly earnings and in the work force to arrive at P.A.Y.E. collections. Other bases were used to estimate increased collections of provisional tax. The table also shows additional deficit which would have resulted from using the inflation related tax schedules.


– Thank you, Mr Deputy Speaker. Mr Milton Friedman has been in Australia recently and I think he has espoused the cause of tax indexation. We can be selective about the things which we want to repeat from the arguments which he proposed. This is something about which a lot of people besides Milton Friedman have been talking. Certainly I have been talking about it for quite a few years. We will not accept the crocodile tears or mouthings from honourable members on the other side of the House who never did anything about the situation. I believe this Government is aware that it has responsibilities to the Australian public, particularly with regard to the taxation system. I believe that notice will be taken of the reports of the Mathews Committee and the Asprey Committee. I hope that one of the recommendations from the committees is that in the not too distant future some adjustments to the taxation rates in Australia will be available on an ad hoc basis or on a graduated index basis.


-Mr Deputy Speaker, I wish to make a personal explanation.


-Does the honourable member claim to have been misrepresented?


– Yes. It was not clear whether the honourable member for Blaxland (Mr Keating) was referring to me in particular or the Opposition in general when he said: ‘You never said this’. I would like to point out that leading up to the time of the last Budget, I myself said on a number of occasions, and the Opposition took this position, that there ought to be a $ 1,000m cut in taxation. That would have reduced the prospective increase from 32 per cent to 25 per cent, which is almost precisely what would have happened under indexation. It was, in effect, an indexation proposal.

Mr KEATING (Blaxland)-Mr Deputy Speaker, I wish to make a personal explanation.


-Does the honourable member claim to have been misrepresented?


– Yes. I did not say that the matter has never been spoken of. I said that the Opposition parties when in Government had the opportunity to do something about it but they did nothing. What the honourable member for Berowra (Dr Edwards) mentioned about a tax cut on a one-off basis is not indexation and he well knows it.


-My main concern about the state of the economy is encompassed in a fairly simple question which I asked the Treasurer (Dr J. F. Cairns) on Tuesday of this week. I think for the benefit of the House I ought to repeat it. I asked:

Last week the Treasurer told us about his policy of using deficit financing to lower the present level of unemployment. How is his solution of burying the unemployment problem under a mountain of money actually working out? If printing money is a good solution to the unemployment problem, why not print more of the stuff and get rid of the unemployment problem altogether?

The Treasurer replied:

We might do precisely that.

That conjures up a pretty poignant picture. I see in my mind the Treasurer down in the bowels of this building with tears in his eyes, with sympathy for the people, oozing the milk of human kindness, turning the handle of a printing press, turning out money to bury his unemployment problems. That is just the kind of thing on which Australia wants to concentrate its thinking. What kind of Treasurer have we? He is a man who says that he can bury his unemployment problem by turning out more money. We know what will happen; it is not hard to see it. There would not be an economist in the country who would not recognise the inevitable wrath to come. We know that consumer spending will rise. It must rise because of this flood of money being pushed out by the printing press down below. We know that, inevitably, with measured tread will come the doom that follows this kind of exercise. In every case, for example in the history of Germany and the South American republics, any country which has tried to solve its problems by turning the printing press faster has come hard up against the inevitable facts of economic life. Probably in a year’s time we will have an escalation in the rate of inflation. I think everybody in the House knows- except perhaps the Treasurer- that it will come again- a reckoning in the form of unemployment. It will be an almost insoluble problem. This is a tragedy for Australia.

The Treasurer thinks he can bury his unemployment problem with all the sympathy which he has. He does not have an option on sympathy; he is not alone in his concern for the unfortunate. But a person in a place of responsibility such as the Treasurer, cannot bury his problem of unemployment by turning the printing press faster. As the Treasurer said on Tuesday, he is really making a problem which, if he stopped to think about it, he would recognise as one which will make the future problem much more serious than the one we have at present. Why would this happen? Why Will it be inevitable? Why will the doom, the wrath to come, stalk inevitably after the Treasurer? It is not because demand will not rise; it Will rise. At the end of the year we will have an increase in demand fed by this money which is being turned out so earnestly by the Treasurer. But the fundamental problem about Australia’s economic situation is that no one is prepared to invest so that we can produce better goods. Fewer goods will be produced in the futuremaybe by the end of 1976- because no one will invest money in industry.

Who would put money into mining with the Minister for Minerals and Energy (Mr Connor) waiting to clobber anybody who made a success of it? Who would put money into farming? There may be a few people- I am not one of themmaking money out of farming. But who would put money into farming at a time like this, knowing that the inflation doom will follow so inevitably? The Treasurer probably knows- there certainly would not be one honourable member opposite listening to me who did not recognise itthat there is an inevitable doom overtaking us because of this idea that problems can be solved with more earnest application to the handle of the printing press. There would not be one of us who did not recognise the fundamental problem with which we are faced is that industry will not invest its money. It is not going on strike, although I know that is a fashionable word nowadays. People who have money are funny; they will not invest unless there is a reasonable chance of profit from it. I think there is not one honourable member opposite who would not recognise that the problem of inflation will be worse in 1976 than it is now. As a result, unemployment will be worse.

The more vigorously the Treasurer turns the handle of that printing press downstairs, or wherever he does it, the worse will be our position with regard to unemployment. Despite all his sympathy for the downtrodden ones he most wants to help, these are the people who in 1976 are going to suffer most because of his earnest application to the handle of a printing press because he thinks- I do not think he thinks; he feels- that may bury his problem under a mountain of money. I think that not one person in this House does not recognise that, although the Treasurer feels that he is doing right, he must know he is doing wrong. As a result of his actions everybody is going to get, as the Treasurer would hope, more equal slices of the economic cake. That is a philosphy which I can understand and I do not denigrate. But the inevitable result of what the Treasurer is doing downstairs today is that the economic cake is going to be smaller. It is going to be cut up in more equal slices, I grant, and I can understand the philosphy behind that; but the fact is that the cake is going to be smaller. Everybody is going to have equal shares of misery. That is a phrase that was used by the Leader of the Opposition after the announcement of the British Budget this week: ‘Equal shares of misery’. If one is dedicated to having equality at any price, I can understand that. But one should remember that the inevitable result of this is that there will be a smaller economic cake to cut up. People may think that that is a price they are prepared to pay; but inevitably all the fine things one wants to do- and I am not denigrating them; I think there are a great many I would want to do- can be done only by cutting up an economic cake and the cake is inevitably made smaller because of the dedication and the fine sentiments of the Treasurer down below in the bowlels of this Parliament swinging on the handle of a printing press.

I have been asked to confine my remarks to 10 minutes, and I see that 10 minutes is up. I just want to emphasise to the people of Australia who are listening and to the few people on the Opposition side of the House who are listening that in a choice between having a bigger economic cake, cut up in less equal slices maybe, and a smaller economic cake cut up in equal slices of misery, the decision will be the Treasurer’s, because he is better able to arrange it than anybody else has ever been able to do. The dedication he applies to that handle of the printing press will do more to bring about the cutting up in equal slices of a cake of misery than anything else, if that is indeed what they want.


– I should like to spend my time replying to the doomsayer from South Australia but I had hoped to spend my time tonight looking at something which concerns us all in this Parliament- unemployment. In this House, in this debate and in previous debates in the last month or two, the Opposition has continually berated this Government for allowing unemployment to the level of 300 000 or so to occur. I want to look at the matter of the measurement of unemployment and to suggest that the figure of 300 000 is a gross exaggeration of the real level of unemployment in this country at the present time. The measure of unemployment generally used in this House and outside is the number of registered unemployed as shown by the Commonwealth Employment Service, the CES- I will use that abbreviation. These figures are compiled every month and they measure the number of persons registered at the end of each month with the CES who claimed, when registering, that they were not employed and who were seeking full-time employment, which is defined as 35 hours a week or more. The latest figures are for the March quarter and they show 270 784 persons unemployed on this measure.

However, there is another measure of unemployment, and that is the labor force survey which is compiled by the Bureau of Statistics. It is conducted quarterly using a sampling technique, and the sample covers almost 30 000 private and non-private dwellings. It defines as unemployed those civilians aged 15 years or more who, during the whole of the week prior to the interview, did no work at all because they did not have a job but were actively seeking work and those who did no work at all because they were temporarily laid off from their jobs for the whole week. It comprises, therefore, those looking for full-time work, those looking for part-time work and those temporarily laid off from either fulltime or part-time jobs. In this measure, the latest figures available are for the month of February 1 975. Those figures show the total number of unemployed as being 286 200. This compares with the CES figure for the month of February of 297 747. So the survey figures were 1 1 547 less than the CES figures for the same month, which is the last time for which we can make a comparison.

Therefore, in this country there are these 2 measures of unemployment and the survey figures are just as valid as the CES figures. Indeed, I believe they are more valid. In the past, the concentration has always been on the CES figures, even though the survey figures have been published quarterly for some years. This has been due to the fact that the survey figures were produced only quarterly and, more importantly, they became available only some 3 or 4 months after the survey was undertaken. As from this year, though, they are available within 3& weeks of the end of the survey month, so they are of much greater relevance than previously. If we have 2 such measures of unemployment and they do not produce the same result it is important to know which is the more accurate and reliable and also to understand why there are differences in the levels of unemployment that they record.

In attempting to explain these matters may I firstly say that, if one is comparing like with like, then one should not compare the total levels of unemployment produced by the 2 methods, because their definitions full-time are different. The CES figures relate only to the unemployed workers seeking full-time full-time the total survey figures, which I have already given for February 1975, include unemployed workers seeking part-time work as well as those seeking full-time work. Fortunately, the survey figures are broken up as between full-time work seekers and part-time work seekers. We can, therefore, compare the numbers of unemployed workers seeking full-time work as shown by each of the 2 methods. For February, once the part-time work seekers are excluded, the survey shows the numbers of unemployed workers seeking fulltime work as 243 600, which compares with 297 747 shown by the CES. Thus the survey figures are some 54 000 less than those produced by the CES.

But this is not the end of it. The survey figures are really an average of the whole of the month of February, as they are obtained from interviews conducted each week in February. The CES figures, though, are taken at the end of the month. So if we compare the CES figure for February with the survey figure for that month we are comparing an end of the month figure with a figure that is an average for the month. To overcome this and make the comparison a little more valid we can average the CES figures for the end of January and the end of February, to get an average figure for February- a midFebruary figure- which is more comparable to the survey figure. The result of such a collection is a figure of 304 670 unemployed in February 1975 on CES figures- about 61 000 more than the 243 600 shown by the survey. In itself, this is an extraordinary difference, but it is even more extraordinary when we consider that the CES figures should be lower than the survey figures because those CES figures cover only registered unemployed, whereas the survey figures cover all unemployed whether they are registered or not.

Of course, not all workers bother to register when they become unemployed. They may decide to seek work themselves for a while before they bother to go to the CES. So the number of total unemployed should always exceed the number of registered unemployed, but that is not the case on the figures, as I have shown.

Thus, when we consider that the method of measurement that covers only registered unemployed shows a figure of more than 60 000 above the figure produced by a method of measurement that purports to cover all unemployed, there is clearly something very wrong with one or other of the measurements. I suggest that all the evidence points to the fact that the CES figures are the ones which are most likely to be misleading, very substantially misleading at that. This is partly because there is no reason to suspect the Bureau figures as being misleading. Certainly they are obtained by sample and are therefore subject to sampling error, but this is quite small and in any case could just as likely inflate the unemployment figures as deflate them. In any case the fact is that the survey figures of unemployed persons seeking full time work have been less than the CES figures for almost every month for which one can make comparisons. Thus the February figures are no momentary aberration; they are part of a pattern in which the CES figures are above the survey figures and getting further ahead of them as unemployment is intensified. Moreover, the survey figure is compiled on a basis that is internationally accepted. It conforms closely to that recommended by the Eighth International Conference of Labor Statisticians. It is directly comparable with the method of measuring unemployment in the United States of America and Canada. The United States Bureau of Labor Studies uses our survey figures on unemployment to measure Australian unemployment when it produces its comparisons of international unemployment rates from time to time. There seems little doubt, therefore, that the survey figures are soundly based and there is no reason to suspect that anything odd has occurred in relation to their compilation.

The same cannot be said, however, for the CES unemployment statistics. There are in fact good reasons to suspect that the number they show as being registered unemployed persons seeking full-time work is not an accurate figure of the number of registered persons seeking fulltime work who are actually unemployed. One such reason is that the CES figures of registered unemployed include persons referred to employees by the CES but whose employment was still unconfirmed by the Friday nearest the end of the month when the count of registered unemployed is conducted. This is a factor which is always present and so always will tend to make CES figures higher than they should be by including as unemployed some people who have been referred to a job and have in fact obtained that job, so they are not unemployed. I understand that the normal departmental practice is for the CES to contact the employer the day after the referral to see whether the person referred has obtained the job, but this does not always occur for one reason or another, and may be less likely to occur when the CES staff is overwhelmed with work, as has been the case for the last 6 months or more.

Another factor which would artificially inflate the CES figure is that persons registered with the CES may have obtained employment through their own endeavours without notifying the CES. They eventually would be taken off the list through what is known as the lapsing procedure which involves checking through the registrations to see which registrants have not been in contact with the Employment Office for a month and wiping such persons off the list. But this means, of course, that a registrant could obtain a job through his own devices, but because he did not notify the employment office that he now had a job he could remain on the books as a registered unemployed person for weeks and be counted at the end of the month.

One further factor that may artificially increase the CES figures is that they include all persons who receive unemployment benefit, and, to the extent that some people may be swindling the Government by drawing unemployment benefit at the same time as they have a job, the figure would be too high. It is difficult, indeed impossible, with present knowledge to say whether this is an important factor but it could become more important as unemployment increases because people are not able to be work tested when there are no jobs to offer them. Thus so long as someone is prepared to lie about his income and employment status it is difficult, although not impossible, to catch up with him at a time of substantial unemployment. As the Minister for Labor and Immigration (Mr Clyde Cameron) stated to the House a couple of days ago, one benefit of the Regional Employment Development scheme is that it has enabled the CES to work test a substantial number of registrants by offering them jobs, in this way testing the validity of their registration. Thus the value of the RED scheme is not simply what jobs it provides but also the effect it has in eliminating from the registered unemployed those people who are not genuinely seeking work but are content to live on unemployment benefits, and in eliminating also those who already are employed but drawing unemployment benefit as well.

So for these reasons we can only conclude that the CES figures on unemployment substantially overstate the actual number of persons seeking full time employment. If we are to have a debate about unemployment in this House then we should be looking mainly at the survey figures, but because they are produced only quarterly that is difficult. If we must talk about the CES figures let us realise and face up to the fact that they substantially overstate the number of unemployed persons in this country.

Darling Downs

-We have just listened to 1 1 minutes of academic nonsense. No matter how unemployment is measured, whether it is measured by survey or not, if a person is out of work he is out of work. Surely the honourable member for Gellibrand (Mr Willis) should have been going to the market place and hearing the pressing cries of the record number of people who are unemployed in this country. I submit that no academic exercise will do away with the very great problem of record unemployment that we are facing. No beating of any drum will drown out the cries of the people who have been forced out of employment through the fiscal policies of the Australian Labor Party.

During this cognate debate the whole canvas of Australian financial manoeuvres has been traversed. It will not be my intention to recultivate those fields but I want to comment on a few of the matters referred to in the various Bills as well as to make a few passing shots at the Government’s financial policies. The Government is responsible for the direction of our finances, and economic theory is the most sensitive theory in the population’s eyes because it affects them where it hurts them most- in the hip pocket nerve. People all over the world are suffering from similar difficulties. In Australia those difficulties are compounded, and there is a long litany of them. Distrust of Government administration, unemployment and inflation are matters uppermost in the thoughts and minds of our people, and well they should be. Promises are worthless, and Whitlam ‘s road is paved with them. The promises of the Government and its endless unsuccessful measures to implement them have caused a breakdown in our economic life. In effect they have created a quagmire. As the honourable member for Wakefield (Mr Kelly) said, the policy of printing money, as advocated by the Treasurer (Dr J. F. Cairns), is merely adding fuel to a raging fire. Budgeting for a deficit which has escalated and is continuing to escalate day by day does nothing whatsoever to increase our productivity. Productivity must be increased if we are to contain the problem of inflation.

The type of economic activity practised by the Labor Government makes a farce of budgeting. In effect the Government turns on the printing press when it wants to fund a project which will make it electorally fashionable and popular. I recall the words of my colleague, the honourable member for Fisher (Mr Adermann), in the Budget debate when he decribed the Budget as phoney, a farce and a fake. How true his words have turned out to be.

Mr Lucock:

– Very wise words.


– As the honourable member for Lyne says, the words of the honourable member for Fisher were very wise. The public’s holdings of currency- notes and coins- have increased in recent years from $ 1,467m in June 1972, to $l,702m in June 1973, to $l,957m in June 1974, and to $2,273m in January 1975. Most of the increase was provided by the printing of new money.

The Australian Country Party, unlike the Aus.tralian Labor Party, is firmly committed to the proposition that there should be a job for every Australian- a job which is self-satisfying and which enables him to contribute in a productive way to the Australian economy. We do not like unemployment, nor do we subscribe to the point of view, apparently held by the Government, that unemployment is to be deliberately the order of the day. The Government’s ruthless attack on the private sector has not only destroyed private contractors and individuals but also has destroyed job opportunities for people. The facts are clear and the position is stark in its reality. We do not want academic exercises to give the true figures. Unemployment in March 1972 was 97 877; in March 1973 it was 84 585; in March 1974 it was 82 562; and in March 1975- this is probably an Australian record- it was a staggering 270 784 people.

Mr Sullivan:

– Incredible.


– As the honourable member says, it is incredible. Like the honourable member I am campaigning for these 270 784 people. I am campaigning for them and their families against the Government’s destruction of their personal freedom and dignity as individuals. As a human being every individual has a right to work. This Government has grown in the scale and size of its spending and control of our lives. We reject both of these concepts.

I was amazed at speakers from the Government side who wanted to blame inflation on a world wide phenomenon. These utterances are bleatings of the feeble, embittered and impractical. The responsibility of inflation in Australia is anchored with the Government. No camouflaging will conceal the fact that the average rate of inflation in 1974-75 in the capital cities was 13.3 per cent. The Prime Minister (Mr Whitlam) in the election campaign last year promised that inflation would be reduced. What hypocrisy! His promises have melted away like snow in the mid-day sun. The diseases of inflation will not be cured by a government which allows the problem to go uncontained and funds its mammoth free spending campaign by the movement of taxpayers into higher scales of taxation contribution. We submit that this is the worst type of cancer- a cancer from within.

Other speakers have given statistics of the increases in expenditure proposed in these Bills compared with the expenditure last year. I will not recapitulate those figures. But I do want to comment on several areas which are causing concern in various sectors of the community. I submit that it is the responsibility of the Government to make sure that the people of Australia, no matter where they live, are entitled to services of a fair type and a fair share of government funding. Tonight, on behalf of people who live in rural areas, I protest about the run down of postal communications. There has been a curtailment of the installation of automatic telephones in rural areas. Obviously there has been a transposing of finance from the rural areas into large city projects. We have seen contracts called for the delivery of mail on a fewer days per week basis than previously. Obviously, if one lives in rural areas one is not entitled to a daily mail delivery as are people who live in the cities. I protest at the savage increase in telephone rentals paid by people who live in rural areas. I cannot subscribe to this principle because the people who live in rural areas do not have access to the cheaper type telephone calls as do people who live in metropolitan areas.

Recently we witnessed savage increases in the price of fertiliser, In particular I refer to the $23 per ton increase in the various nitrogenous types of fertilisers. The reason for this increase is that no encouragement has been given to people to get out and explore the natural gas wells whose products form the main ingredient in the production of fertilisers. Similarly there has been a huge increase in the home consumption price of bread due to the savage increase in the price of superphosphate. I charge the Government with complete irresponsibility for the removal of the subsidy on superphosphate because country which has been built up over many years by the techniques and application of fertiliser will return to useless type country. As a result the price of food to the public will increase.

My final comment is related to the proposed Medibank scheme which is the brain child of the Minister for Social Security (Mr Hayden) who is sitting at the table. I refer to an answer that he gave to a question I placed on notice in which he said that if any money is required to fund the program in future years the Liberal-Country Party will stand responsible. I charge the Minister with deliberately wasting $2m of taxpayers’ money through the flickering screen of television to try to inculcate in the minds of the Australian people an acceptance of a system of health care which is nationalisation and socialisation of health.

Mr Donald Cameron:

– It is false propaganda.


-It is false propaganda. The Opposition was able to allow the Australian people a type of medical scheme free of the 1.35 per cent tax on income which the Minister sought to introduce. We were the people who stopped the imposition of that iniquitous tax. I want the

Minister to stand up and be counted. He should pay tribute to the Liberal and Country Parties for saving the people of Australia from having to pay that increased taxation. I am opposed to Medibank on account of my political philosophy. I believe that if this scheme is introduced we will have dearer hospital care and private enterprise and initiative which have stood this country in good stead in the past will be destroyed.

Minister for Social Security · Oxley · ALP

– What has become quite clear in the course of 2 1/2 years of debate on economic policy in this Parliament is the fact that the Opposition is ideologically opposed to the public sector. The greater the level of neglect the happier Opposition members are that the public sector is being repressed. Certainly I think it would be agreed that I am not one who would subscribe to the belief of extravagance in the public sector. But neither can I accept the intolerable proposition that neglect in the public sector should be the norm. I cannot accept, for instance, that pensioners or people dependent on welfare services should be those who should bear an unreasonable burden in the economic management of this country. I find it revolting that for so long national governments refused any commitment at all towards improving public health services in public hospitals or in community health services. The neglect of education in this community stands as a singular failure of the previous Liberal-Country Party governments and the complete indifference towards the need of urban development and improvement is a clear indication of the way in which previous LiberalCountry Party governments were prepared to ignore the needs of the great numbers of people in this community.

One tended to think it was a matter of not catching up with contemporary expectations. But what is clearly emerging from the LiberalCountry Parties in Opposition is that it is not a matter of catching up but rather a matter of resistance- of being ideologically opposed to a reasonable level of public expenditure in the Australian community. I give one example to illustrate the point I am making. What has been said by spokesmen from the Opposition in relation to pension policies indicates who will bear the brunt of cuts in the public sector about which they speak so frequently since they have been in Opposition. If we had followed the pension policy of the Liberal-Country Party Government and increased pensions only in accordance with the consumer price index movements the pension rate would be $27 a week instead of the rate which we will establish next week of $36 a week.

We could have saved $9 a week on the standard rate. The married rate, instead of being $30 each a week would be only $23.29 a week. This would be a saving of over $6.70 a week. In total we could have saved $5 15m at the expense of pensioners in the community.

I think that is an extremely important point because it shows a key area where the Opposition, if it were to be a government, would cut back. It is areas such as this which would have to take the full burden of the severe cutbacks which honourable members opposite are now putting forward as a simplistic remedy for the economic problems facing not only this country but also most other advanced countries today. If it is merely a matter of the level of public expenditure creating inflation and therefore the remedy being to reduce the level of public expenditure, I ask honourable members opposite why it is that on the one hand in Australia public expenditure at the federal level in the Budget is about 25 per cent or a little more of the gross domestic product but in a country like Sweden public expenditure has a level of something like 40 per cent. Yet the same economic problems exist in both countries and they are roughly of the same magnitude. Canada has a higher public sector than has Australia. Of course this illustrates the complete foolishness of the simplistic approach adopted by honourable members opposite.

Earlier this week in a debate initiated in this House by the Opposition one of the more impressive spokesmen of the Opposition on economic matters asserted that it was not the Opposition on trial but rather the Government. I accept that the Government is on trial. It must constantly be on trial in relation to the full range of its administrative responsibilities. But it is unreal to suggest that the Opposition, too, is not on trial because, in our parliamentary system of government, the Opposition offers itself as the alternative government. Therefore while in Opposition it must establish its credibility as an alternative government. In 10 minutes one can scarcely explore the range of responsibilities in which the Opposition should display this sort of credibility. But I want to deal with money supply, tax cuts and income policies such as one can garner from statements by spokesmen for the Opposition on what the Opposition proposes. Perhaps it is helpful to have included in the reports of the debates of this House a table on money supply growth rates which commences in the March quarter 1971 and comes up to the December quarter 1974. 1 ask for leave to have the table incorporated in Hansard.


-Is leave granted? There being no objection, leave is granted. (The document read as follows)-


-The importance of this table is that it exposes some of the dishonesty which has been bruited about by spokesmen for the Opposition. For instance, in November 1974 the former Leader of the Opposition in criticising the money supply- as spokesmen for the Opposition are doing now because they seem to be fixed on this proposition of public expenditure and money supply- stated:

This was highly inflationary and was totally irresponsible.

Then, to bolster bis argument he had included in the records of the House a table on money supply growth rates which commenced in the March quarter 1973. That is very interesting because it deals only with the period that this Government has been in office. But if we go back to the March quarter 1971 we find the phenomenal rate of increase in money supply which took place under a Liberal-Country Party Government which has never been equalled before or since and is never likely to be. For instance, in the December quarter 1972 the narrowly defined money supply -Ml- increased by 34.6 per cent. The broadly defined money supply- M3- increased by 29.1 per cent. That is the highest record ever in this country’s history. The facts are that the latest figures which have been released by the Bureau of Statistics show that the money supply is now starting to turn down slowly. It seems to me that slow turndown is probably a reasonable sort of movement. I accept the need for some son of turndown but a too rapid turndown will aggravate the very problem about which the Opposition is talking. It would create a savage and sudden contraction in industry and bring about a savage collapse in the work force of the country. But let me cite another example. The ‘Australian Financial Review’ in an editorial in October last year stated:

The McMahon Government … for electoral reasons, promoted a rate of monetary expansion which was totally unjustifiable in its rapidity and which, with the accompanying rate of capital inflow, was mainly responsible for the demand inflation of 1 972-73 and the inevitable consequence of the current cost inflation.

That was said late in 1974. Then, more recently, on 9 April Professor Milton Friedman at the National Press Club stated:

In 1971-72 . . . your Government, unwisely in my view-

That was a Liberal-Country Party Government tried to hold the exhange rate and did not revalue, and at that time you had a very large inflow of foreign capital that produced a large increase in the quantity of money that subsequently did produce rapid inflation.

That is printing banknotes. That is printing money. That is cranking the handle of the printing press about which we have heard so much tonight. It is undeniable that the economic instability with which we are confronted at the present time had much contributed towards it by the irresponsibility of the Liberal-Country Party Government.

Let me move quickly to tax policy. What is the policy of the Opposition? It speaks rather vaguely and alludes rather generally. I think it is overdue for the Opposition to come out with some precision about exactly what its policy is. The best we can do is refer to its policy document, the National Economic Program for 1975, which was released in February this year. In that program the Opposition argues that there is a case in the 1975-76 Budget for tax cuts. In the first half of this financial year this Government was responsible for pay tax cuts of the order of $ 1,200m. This means that a taxpayer supporting a wife and 2 children, on $ 100 a week has a saving of some $6 a week. A taxpayer on $140 a week has a saving of some $5.50 a week. I do not imagine that the Liberal Party and Australian Country Party as a government when preparing the 1975-76 Budget would want less than that.

Let us pull these loose threads together, and together see how the Opposition would cut back the money supply by eliminating the Budget deficit, and how it would apply tax cuts. I ask honourable members to bear in mind that its former leader- this has not been denied yetgave a commitment, to the extent that it could be calculated, of net increased expenditures of $ 1 74m in March this year. This was stated on the program ‘Federal File’. Their defence spokesmen in succession have asserted that defence expenditure as a proportion of gross domestic product would be restored to the level it was in the period of the Vietnam war, namely, about 3.5 per cent. Let us put these things together and get a little bit of simple arithmetic so that we will see what nonsense the Opposition is talking. It is going to cut the deficit. At the present time it will cut out about $3,300m of public expenditure. It will apply tax cuts which we would expect at least to equal what we did in the first half of this year which totals about $ 1,200m. It suggests a net increase in expenditure of over $174m. Its increase in defence expenditure, by the commitment of its defence spokesmen, will be about $400m. What this means is that the Opposition is talking of a reduction exceeding some $5 , 000m or a cut of some 25 per cent in the Budget as it presently stands.

The Opposition is also saying that there will be no cut in Defence and that there will be cuts in some other vague and not specified fields. So this means that in some areas there will be cuts of more than 25 per cent. I challenge the Opposition: Where will the cuts take place? What I have just illustrated to honourable members in this House and to the listeners indicates the complete irresponsibility of the loose, unrelated propositions which the Opposition keeps throwing around in the community today. Members of the Opposition are the people on trial at the present time. They are the people who claim a right to be seriously considered as an alternative government. They are completely devoid of any wages policy. Like other speakers, I regret that time does not allow me to deliver my 10-minute speech in anything less than about 25 minutes. Accordingly I cannot discuss wages policy. But the fact is that the Opposition is on trial as much as everybody else in the community.

I conclude by conceding quite readily that, as I said earlier this week, the economic strategy of the present time is not necessarily the economic strategy which will be appropriate in 6 months time, and I do not believe that it will be. I do not believe that in 6 months timewe would want to see the money supply increasing at the rate at which it is increasing at the present time. I would not like to see in 6 months time, when the Budget is being applied, a monetary policy being used excessively, and I certainly would want to see a significant degree of fiscal responsibility.


-The Minister for Social Security (Mr Hayden) started his speech by tilting at windmills inasmuch as he set up sundry policies which the Liberal and Country parties have never advocated and then spent much of his speech in trying to knock them down. Then he berated us for having a policy to deal with the current economic crisis. It is time that the Government had a policy to deal with the country’s economic crisis.

I wish to discuss just one effect of the way in which the appropriations that are before us will be spent. The Whitlam Government is committed to the ultimate development of one strong government for the whole of the Commonwealth, based in Canberra and having ultimate authority over all things for all Australians. It is committed to a unitary system of government. The Prime Minister (Mr Whitlam) when delivering the 1957 Chifley Memorial Lecture made the position very clear when he said that the role of Labor members of State parliaments is to try to bring about the dissolution of State parliaments. That is not an inherently unreasonable standpoint, although it is not mine. My fear is that Australia is heading for the day when it has, in effect, a unitary government operating within a warped and inappropriate- or no longer appropriate- framework of a federation. There is no doubt that a unitary system of government can be made to work. In fact, most countries of the world have such a system. I think that such a system is more likely to work well in countries in which the population is concentrated, such as in Great Britain, although even there both Welsh and Scottish nationalism is, after hundreds of years, still a bone of contention. Whilst I do not believe it would be in the best interests of Australia and whilst I do not believe that most Australians want it, I have no doubt that it could be made to function quite well, particularly for those people in the south eastern corner of the continent. What I doubt is the wisdom of developing a situation in which a federation is controlled by its national government where that control is through the purse strings.

In Australia the major taxing powers rest with the Commonwealth. Moneys flow to the centre and at the same time effective powers flow from the centre. In order to understand how this occurs it is convenient to imagine oneself in the position of being the recipient of a grant. Some moneys are paid to States and local authorities as general grants. In other words, they have no strings attached and no harm is done. But, because an increasing proportion of the money is paid in specific grants, that is, for a specific purpose, as members of a recipient body we must decide whether we will use the money according to the choice of the donor body or whether we will have nothing to spend. So we accept the grant. The essential choice between projects has been made by the arm of government with the money. It is said: ‘Ah, but the categories of expenditure are very broad; you have choice within the category’. The categories are not nearly so broad as they used to be and the Minister in Canberra often retains a power of veto, a power which in practice is exercised by his officers. So the choice of the recipient of the grant is narrowed even further. But still money for expenditure on an umpteenth choice is better than no money at all, so the grant is accepted.

The Regional Employment Development scheme is an excellent example of the way in which those effects are felt. Large sums of money are available to shire councils and other bodies for expenditure on projects chosen by the Minister from a submitted list. Shires submit projects for approval because they have nothing to lose. As far as they are concerned, their responsibility is to their local citizens. Money spent in their area, even if it is on the most wasteful project, is better than money being spent in another area. After all, their citizens are going to share in the payment of taxes to the Commonwealth Treasury. Instead of the local people deciding their priorities, Big Brother has made most of the decisions for them and, because of his inevitable lack of local knowledge, usually he has made them badly.

The Minister.for Labor and Immigration (Mr Clyde Cameron) has often claimed the support of all members of Parliament for the RED scheme because all members have supported individual projects. Members of Parliament feel a responsibility to their electorates and they claim for their electorate whatever portion of the handouts they can get their hands on. That does not mean that they believe that a handout is the best way in which to engender responsibility or initiative in shires or in individuals or that the money is going to the ideal projects. Matching money financing is, if anything, even worse than specific grants because in such cases no one assesses individual projects against their total cost.

The power of the Commonwealth to make specific purpose grants to the States under section 96 of the Constitution and the States’ unbridled power to make specific grants to shires has resulted in a steady flow of power to the centre. Admittedly, the process started long before the Australian Labor Party came to power in Canberra. The dealings of States of all political colours with their shires is a very close parallel to the Commonwealth’s dealings with those same States. However, the Labor Party, by greatly speeding up the process, has emphasised what is happening, and « may thus have done Australia a service.

Any choice for unitary government should be a conscious choice and the Constitution amended accordingly. If the Labor Party believes that that is what Australians really want, it should then draft amendments to the Constitution and put them to the people. If we continue to unify by the back door we will end up with an uncertain legal position and with a tortuous and inefficient administrative chain still involving what will have become a powerless and embittered State organisation. If the present Commonwealth Government seeks to unify all governments in Australia it should continue to say so. The Prime Minister has said again, as he has said in the past, that that is so. He should not pretend, as did the Minister for Education (Mr Beazley) in the debate on the Technical and Further Education Commission, that money can be granted for a narrow, specific purpose without some measure of control being exercised.


-Having listened to the contributions made this afternoon by Opposition speakers in the debate on these Bills, one can come quickly to the realisation that nothing has changed on the Opposition side. We have a few new faces but we have the same old worn out policies. The whinging and wailing is to the fore again. Opposition members criticise and complain, but they never offer a constructive solution. That seems to be the hallmark of the Opposition, irrespective of who leads it and irrespective of where its members went to school. All honourable members opposite preach the same gospel of despair and advance the same argument of criticism, the same negative, backward looking pessimism by which they hope to attract the support of the Australian people. They have no faith in Australia or in Australians, and Australians have no confidence in them. That is why the present Leader of the Opposition (Mr Malcolm Fraser) is destined to remain in that position for as long as his colleagues will have him; he is not going to be transferred by the Australian people from that side of the table to this side. The huff and puff philosophy is still paramount under the Liberal plan. The way ahead, presumably, is to be powered by the huffing and puffing of the Opposition front bench. Soon they will run out of their huff and their puff and they will find that the Australian electorate will have nothing to do with such negative, pessimistic individuals.

Australian industry has its difficulties. Australian industry leaders understand that in the last generation there has not been a government which has had such a concern for the well being of industry, to ensure the growth of efficient productive industry in this country, as has the present Whitlam Government. They know that there are people in Canberra today who are willing to help to ensure that the industrial resources of this nation are used to their maximum capacity. Of course there are economic difficulties and of course they are substantial and complex. When one listens to the naivety of the Opposition members one wonders whether they know anything at all about the subject about which they have been talking for so long.

Inflation is a problem which is affected by world events, whether they like it or not. I have never been one to suggest that inflation is exclusively an imported problem. Those who say and argue that world events have no bearing on the current inflation in Australia and have no effect on the current unemployment in Australia are fools or ignorant people- one or the other. They simply do not understand or they are engaged in a campaign of duplicity. I believe that as events pick up, as economic activity is revived in the rest of the world, unemployment certainly will be reduced. But this Government is left with a tragic, desperate legacy from previous governments over the last generation. That legacy is that whenever there is full utilisation of all those offering their services for work and employment there is inevitably an acute shortage of skilled labour. If one overcomes the acute shortage of skilled labour there is a surplus of unskilled labour available for employment.

The guilty men sit opposite- the men who refused to encourage apprenticeship training, the men who refused to build technical institutions, the men who refused and did not care to encourage the training of more skilled employees in this country. Under this Government more money, in massive amounts, is being made available for technical education and industrial training. Presumably the Opposition would reduce that amount of money. Where is the cockatoo chorus tonight? Where are those who for 23 years neglected training in technical education in the non-metropolitan area? Yet they stand and criticise the expenditure of funds. They know that they are guilty of the crime of forcing young men and women out of country towns into the cities because there is no employment there for them. They know that one of the primary reasons why there has not been decentralisation of manufacturing industry into non-metropolitan areas has been the almost complete absence of facilities for training the work force. They cannot cover their guilt by attempting to attack this Government. Most of their attacks have been illfounded and ill-advised.

Members of the Opposition will find that the answer to inflation is not to be found in the union bashing Fraser plan. That is no answer to the current economic difficulties. They will find that out to their regret and to the sorrow of the Australian economy and the Australian society. In the past months, and particularly in recent weeks, the Opposition has criticised deficit financing as though this were some cardinal error or some cardinal sin against all economic philosophy. Was it not the late Franklin Roosevelt who suffered the same criticism as he engaged in deficit financing to pull the world out of the greatest depression in history? Was he not criticised by the same ignorant arguments that are being advanced here today? In any event I want to hear the Opposition specify in what areas it would reduce the deficit financing. Surely honourable members opposite understand that money is merely a means of exchange. Surely they understand that what is required in any advanced society not in the grips of the rich and powerful few is to ensure that all the resources, both human and technical, are utilised for the production of goods and services for the benefit of the community.

What is all this double talk we hear? Six months ago Opposition members complained bitterly about the so-called credit squeeze. They said ‘Make more money available. Get the money out. Release the brakes on credit. ‘ Today they are saying: ‘There is too much money around. The Government must close the floodgates and stop the printing press. ‘ I do not understand what they mean because they are not being very frank. What I suspect they mean is that part of this plan is to put the employee back in his place, to put the employee back where he belongs, to reduce his bargaining strength. No price is too high so far as they are concerned to ensure that that result can be obtained. Presumably they would introduce a credit squeeze forthwith, because that is what it means when they say: ‘Stop the printing press’. They mean: ‘Make less funds available for community development. Make less funds available for industry.’ Do they mean that they will cut expenditure on education or on industrial training? Do they mean they will cut the funds available for health care or do they mean that they will reduce in real terms the level of social security and other pensions? Is it that they mean that the Government was wrong in reducing income tax, because that has an immediate effect on the size of the deficit, or do they mean that the Government should not have reduced sales tax on motor vehicles? Do they mean that the Government should desist from assisting industry to keep going?

Those who argue that the increase in the price of oil had no effect on the Australian economy are foolish people indeed or else they are dishonest- one or the other. Every economist throughout the world, every government leader in the western world, recognises that the oil price rise has had a significant effect on the world price of basic goods and services, and this country is certainly no exception. They also recognise, those who can see, read and hear, that it has had an enormous effect on the whole question of world financial liquidity. Because between $80,000m and $90,000m extra changed hands there was a world liquidity problem and we suffered our share of that effect. That situation is being corrected rapidly. There is an up turn in economic activity around the world. Many countries are following the lead which was given by this Government- a lead for action for which the Government was criticised but which has found favour in the rest of the world.


– I must admit that I was quite disappointed in the argument advanced tonight by the honourable member for Phillip (Mr Riordan). I have heard him speak in this House many times and I have always admired the manner in which he debates the subject. For him to have gone over that ground again, as Government supporters have done so frequently in this debate, for him to just parrot the criticism of the Opposition, amazes me a little. I really and truly thought that he would have made a more constructive contribution to the debate. I believe that the Opposition spokesmen during the day have explained to the House the dangers that this country is facing under the Australian Labor Party administration.

It is not my intention to re-canvass all those points but I would like to comment on the level of debate from the Government side, as I have done with the contribution of the honourable member for Phillip tonight. The Minister for Labor and Immigration (Mr Clyde Cameron), the Minister for Social Security (Mr Hayden), the honourable member for Port Adelaide (Mr Young) and many others have carried out vicious attacks on the Opposition’s suggestions for sound economic management. The Prime Minister (Mr Whitlam) endeavoured to give a rational summing up of the Government’s position. He was about the only one who did so. Mind you, I think that he was going back about 5 months and has not realised the significance of what is happening in the country today. No real effort has been made by the Government to explain how it expects to deal with inflation and the resultant morass that the country is in because of inflation and because of the Government’s economic mismanagement. One has the uncomfortable feeling after the last few days that the Government will continue to spend and print money, no matter what the consequences. In answer to a question on Tuesday from the honourable member for Wakefield (Mr Kelly) on unemployment, the Treasurer (Dr J. F. Cairns) said in part:

I assure the honourable member and every other honourable member that if by government expenditure I can ensure that any one of those men is put to work productively I will make sure that he is, and he will not be allowed to remain in unemployment because of a shortage of money.

I believe that for such schemes as the Regional Employment Development Scheme and, the National Employment and Training Scheme, as well as unemployment benefits, which are endeavouring to grapple with the massive unemployment figure, the overall cost is running at somewhere in the vicinity of $ 1 billion a year- Si, 000m- and I suggest that most of this is not creating productivity. I would argue that if this money were injected into the private sector, which employs three-quarters of the workforce, by way of tax cuts and assistance to the productive side of our economy, there would not be any need for this massive expenditure of $1 billion. The unemployed in our country all come from the private sector. How often does one meet a redundant public servant? In fact, the growth of the Public Service has been quite dramatic over the past 2 years.

I should like to make one small constructive contribution to the debate. I have a great concern for some sections of our rural community, a concern that I know is shared by many members on both sides of the House. I relate my remarks to the Supply Bill that is before the House by saying that, as far as future expenditure is concerned, no concern is indicated for the need to give assistance to some of the very k»w echelon people in our primary industries. In the brief time available to me I make a suggestion to the Government which may be of assistance. The Government has budgeted for a mssive deficit. This has created our present type of economic society. I venture to say that if there were not this deficit, with resultant high production costs, I would not be here asking for assistance to be given to the lower echelons of our rural sector. In my electorate of Forrest are a lot of new land farmers- people who have come in since the end of the war. They were encouraged to go on the land; they have taken up fertile land and their farms have been growing progressively over the last 20 years. They have made a major contribution to the economy of this country. Because of changing economic standards, because of the world situation, a significant number of these people are in dire straits.

A survey was conducted in one part of my electorate which has some significance for the new land farmers there, and I stress that I am not trying to defend the third generation farmers in my comments. It is significant to note that prior to 1969 many of the new land farmers would have passed any test for long term viability, and this is evidenced by the number of loans which were approved by the Commonwealth Development Bank prior to the establishment of the Rural Reconstruction Authority. Such loans are not granted unless long term viability is evidenced at the time of approval. Two or three major factors have contributed to the sharp decline in viability. Firstly, there is the current high cost of superphosphate, which is an essential element for use in this type of land in Western Australia. Secondly, there is the existing high interest rate attracted by the debts of these farmers. Thirdly, there is the relatively short term of the total debt position and, additionally, there is the increase in costs. Referring to that increase in costs, the price of superphosphate has risen from about $18 or $20 a tonne on the ground to $60 a tonne on the ground. The increase in the cost of labour can be instanced by shearing costs, which have risen from about 72c a head for contract shearing to $ 1 . 10 a head last year. I do not think that anyone on the other side of the House can argue that these massive increases are the fault of the farmers. It is something that this Government and the society it has created have pressed upon us. The cost of more than $60 a tonne for superphosphate on the ground will permit the servicing of a nil debt on a farm carrying 6,000 dry sheep equivalent, using $4,000 a year for living expenses and the current long term wool prices estimated by the Rural Reconstruction Authority and the Commonwealth Development Bank. The survey carried out showed that the average farms were not carrying 6,000 dry sheep equivalent and their debt loads were almost $46,000.

Within the present framework of institutional lending, with current interest charges and costs, the position of these farmers is hopeless. I should point out that the survey covered a lot of people and a tremendous area in my electorate in Western Australia, and its findings would flow through to a lot of other areas within the Commonwealth. The Rural Reconstruction Authority has proved to be effective and flexible when its charter permits it to lend, but the average farmer in my electorate is outside the scope of the existing rural reconstruction scheme. The Authority is not legally permitted to lend to this type of farmer because, based upon any reasonable long term assessment of his prospects of success, he has failed miserably. His farm is not viable. The restoration of the superphosphate bounty will not improve the viability of the farms sufficiently to bring them within the scope of the existing scheme administered by the Rural Reconstruction Authority. The depressing aspect of this to the farmers, who on average are very capable and good managers, is that their existing debts are increasing at an alarming rate. Stock firm debts attract interest at from 12.75 per cent to 15 per cent on a daily balance, which is approximately 14.5 per cent to 17 per cent annually, and bank overdrafts attract interest at the rate of 1 1.5 per cent a year.

I argue tonight for a combination of measures. The restoration of the superphosphate bounty is under consideration. I ask that consideration be given to the expansion of the scope of the charter of the Rural Reconstruction Authority to enable it to assist farmers where their long term viability is not established but where operating expenses can be met in the short and medium term. In such cases, total debts could be taken over and the loan could be repaid over a period of 25 to 30 years at nominal interest rates. The survey clearly demonstrates that 4 per cent interest is too high for new land farmers who are operating essentially grazing properties. Where the Authority takes over total debts, a registered bill of sale should be taken over stock, thus preventing the relending by stock firms of excessive amounts of money which must be repaid from immediate income. In conjuction with the trading banks, or in some instances by a loan, the expanded Authority could provide the total or part of the seasonal carry-on needs as they occur from time to time. The scope of the Rural Reconstruction Authority would shift from its existing supplementary lending role to one where, in instances similar to those of the average farmers I have mentioned, total long term and carry-on needs could be approved against the security of a property mortgage. A bill of sale could be taken over stock and plant, and crop loans made where applicable.


– Although the people who are listening to the broadcast of this debate may not know it, the members of this House who have been participating in this debate this evening have voluntarily agreed to cut down their speaking time. That is the reason why the honourable member for Forrest (Mr Drummond), who was the previous speaker in the debate was cut off in midstream by his Deputy Whip. In the few minutes available to me, before dealing with specific Australian issues, I would like to make a couple of points on matters that are directly connected with Australia only in the sense that they relate to countries in our region.

Earlier this year I visited Indonesia to see what type of society was evolving there, what kind of government was in charge, what kind of opposition was present and so on. I was extremely impressed by the country and I was impressed in many ways by the leadership of the country. One of the disappointing aspects of the visit to me was the presence of a large number of political prisoners. One of the people whom I had gone there specifically to see was out of Jakarta on the days when I wanted to see him. Within a few days after that he was arrested and put in gaol. His name is Mochtar Lubis. In speaking tonight about my visit to Indonesia I am therefore pleased to say that he was released from gaol yesterday or the day before. His arrest received a lot of publicity in the Australian newspapers and justifiably so. I think that it is possible that his detention was discussed by the Prime Minister (Mr Whitlam) when he met President Suharto of Indonesia during the last few weeks.

I am certainly pleased that Mochtar Lubis has been released from gaol. Apparently he has been cleared of all suspicion of participation in the socalled Tanaka riots at the time of the Japanese Prime Minister’s visit to Jakarta in January 1 974. He has been freed completely and no restriction has been placed on his movements. I would like to congratulate the Indonesian Government on taking this step. I hope that the Indonesian

Government will go much further and release not only the people arrested in the 1974 riot but also many of those arrested in 1965. Those of us who wish Indonesia success in trying to form a new society and in trying to give economic benefits to the inhabitants of Indonesia without falling under a communist regime are sometimes disappointed by what we see as the over-reaction of the Indonesian authorities to the actions of the people. After all, Mochtar Lubis spent many years in gaol under the Sukarno regime. It seemed ridiculous that he should again be arrested by the present Government.

The second person I would like to mention- it is appropriate to do so today with the fall of the Khmer Republic- is the Prime Minister of the Khmer Republic, Long Boret, who is, for all I know, dead by now. He was appointed Prime Minister towards the end of 1973. I had the pleasure of getting to know him in 1973 when he was the Foreign Minister of the Khmer Republic and was attending the United Nations. At the time I was one of the parliamentary delegates in New York. He now has a reputation in this country amongst many people with whom I associate of being a fascist and of being an extreme right winger. May I say quite clearly that that is not true. I do not know what he has done between the end of 1973 and now, except what I have seen in the newspapers. I spent a couple of evenings with him and had long talks with him because he was the sort of person with whom I felt some empathy. He is a Cambodian lawyer who was elected to Parliament in about 1965 or 1966. He had been a lecturer or professor at a university. He was very concerned about civil liberties. He was a parliamentarian under the previous government- under Prince Sihanouk- in Cambodia. He was extremely disappointed with the previous government because of its interference with any form of civil liberties in that country. We may have had different opinions about the necessity to suppress civil liberties in Cambodia under certain conditions. At that stage Cambodia was trying to keep out of the war and- correctly or incorrectly- was suppressing much opposition. The point I want to make is that anybody who labels Long Boret as a fascist does not know whom he is talking about. He certainly was not a fascist. He just did not have that sort of attitude. His whole reason for participating in the overthrow of the previous government- the Sihanouk Government- was in fact his opposition to the authoritarian attitude of Sihanouk as the ruler of Cambodia.

I would like to make a couple of points concerning what is happening politically in Australia at the present time or what has happened during the last few weeks. I have been involved in the spreading of the gospel as far as Medibank is concerned. The Australian Labor Party has been working on a national health insurance plan for many years- ever since I became a member of this chamber. Of course, 2 years prior to that the plan had in its essential outline been adopted by the Australian Labor Party for introduction. I must admit that earlier this year, even though the legislation had been passed last year, I had some doubts about its introduction. I had some doubts about whether the Opposition in the Senate, which has control of the Senate, would pass the Supply Bills which we are now about to pass without opposition. I thought that there might be an election and that, because of economic conditions, we might be defeated and the introduction of the Medibank scheme would be postponed. I am pleased that that has not happened. I must admit that I felt sorry when the previous Leader of the Opposition, who was not going terribly well, was suddenly set upon by a pack of wolves, or hyenas or whatever one likes to call them. I am talking about those people in the Opposition ranks- 36 of them or whatever the number was- and the people outside this House, including those who control some of the newspapers- the Fairfax organisation and the Packer organisation- who set to work to destroy the previous Leader of the Opposition. With the help of the Deputy Leader of the Opposition (Mr Lynch), who made his sacrifice for Lent by giving up Mr Snedden, the previous Leader was destroyed and kicked when he was down.

I do not know what the present Leader of the Opposition will be like as a parliamentarian. It is hard to tell at this stage. It is certainly pleasant from our point of view that the whole ball game has changed. The Leader of the Opposition has announced that the Opposition will not oppose Medibank, that it will co-operate with the Government in certain respects and that it will not use its numbers in the Senate in the way it used them previously. Certainly from our point of view there has been an improvement in the leadership and behaviour of the Opposition Parties as a result of the change. I am glad that there will be no further opposition to the introduction of Medibank. That will make it possible for Medibank to be introduced smoothly. The Australian Medical Association has now abandoned its opposition to Medibank and will co-operate with the Government. Obviously everything will be working reasonably well.

Having said that, I would still like to pay a tribute to the previous Leader of the Opposition, whom I got to know when he was, I think, the Minister for Labour and National Service, which was the title of the portfolio in the days of the previous Liberal-Country Party Government, and whom I found to be a very co-operative gentleman. His heart seemed to be in the right place, whatever may be thought about his leadership qualities.

I congratulate the Government in introducing the Supply Bills. I hope that the Government will continue on its way in trying to improve the conditions of the people of Australia.

North Sydney

-In view of the shortness of the time available to me, I should like to revert to the economic argument that has been the main thread of the debate in the House of Representatives this evening. I refer to the statement by the Federal Treasurer (Dr J. F. Cairns) on Tuesday. He said:

As long as by government expenditure we can employ people productively or assist in their employment in the private sector productively so that they produce as much as the expenditure is worth, there is no contribution to inflation. I will continue to ensure that unemployment does not remain in this country if anything the Government can do can remove it.

He has challenged us to produce some proposals, some advice, some information, some policy concept which would be of help to the Government with its problems. I suggest that the Government immediately make provision for the write-off of new plant in its entirety in the year of its purchase or over such period as may be nominated by the company making the investment. As has been said again and again in this House over recent weeks and at the Labor Party’s conference earlier this year, it is now fully recognised that the most vital thing to do is to stimulate the private sector, to get the people who are among the 250 000 unemployed off the unemployment list and back into employment that will be of value to Australia.

Furthermore, the Government should introduce a system of depreciation allowance for the write-off of premises used in manufacturing. The reasons why this assistance is needed are simple and straightforward: Investment in new plant and equipment and new factory premises is at present at a very low level; urgent action is required through Government measures to stimulate private investment in manufacturing and this investment will not be undertaken unless the Government takes action to offset the current disincentives to the renewal of existing plant, expansion of existing manufacturing operations or the establishment of new ventures.

Investment in Australia is not being undertaken by manufacturers for the following reasons: The economy is in a state of recession with a high level of unemployment. That has been fully admitted by almost everybody from both sides of this House who has spoken in this debate. Inflation and the expected high rate of inflation in the future have raised great uncertainties in the minds of manufacturers as to their capabilities of meeting competition in the Australian market from overseas goods and, secondly, of remaining competitive in export markets for the products which they are selling overseas. In undertaking feasibility studies to determine the viability of investment proposals, at this time companies are finding that the extremely high rate of interest payable on monies borrowed for such investment are rendering the propositions unprofitable and not worthy of serious consideration.

Most companies have liquidity problems in Australia and are finding it difficult to generate within their companies or to borrow on the money market from the banks, including the merchant banks, the moneys required for their investment programs. In current circumstances and the existing provisions in relation to depreciation allowances, companies have not recovered from the Government their contribution through the taxation system, except over an extended period of time. In order to assist the cash flow of companies contemplating further investment in plant and buildings, the Government should, in view of all the circumstances existing at present, allow the investor the discretion of writing off the cost of his new investment against profits in the year of purchase of the equipment and buildings, etc., or alternatively, give the investor the discretionary powers to nominate the period over which he wishes the plant to be written off. Such provisions would aid the investors in a very real way and provide that very necessary stimulus to increase investment. Unless urgent action is taken by the Government right now to implement these measures it is certain that manufacturers will delay plant renewal and updating. This will be to the detriment of their efficiency and to their long term capability of operating in competition with overseas competitors.

In the last minute or so available to me I remind honourable members of what was said by that distinguished member of the House of Representatives, the Minister for Overseas Trade (Mr Crean). He said that there would be $ 1,000m to be found between now and 30 June for the payment of company taxation. He said that this would reduce the fiduciary injection into the Australian economy from $3, 000m to $2,000m. Whilst this is the case, I must urgently bring to the attention of the Government the need to stimulate these manufacturers and companies so that they will be able to re-employ people, return to full operations and get the profits which will enable them to met this great company taxation bill which they will have to meet within the next 2 to 3 months.

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 Mr Daly) read a third time.

page 1841


Second Reading

Consideration resumed from 8 April on motion by Dr J. F. Cairns:

That the Bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for a third reading to be moved forthwith.

Bill (on motion by Mr Daly) read a third time.

page 1841

SUPPLY BILL (No. 1) 1975-76

Second Reading

Consideration resumed from 8 April on motion by Dr J. F. Cairns:

That the Bill be now read a second time.

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 Mr Daly) read a third time.

page 1841

SUPPLY BILL (No. 2) 1975-76

Second Reading

Consideration resumed from 8 April on motion by Dr J. F. Cairns:

That the Bill be now read a second time.

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 Mr Daly) read a third time.

page 1841


Vietnam-Australian Economy: Small Business- Northern Territory Legislative Assembly

Motion (by Mr Daly) proposed:

That the House do now adjourn.


– I rise tonight to add something further to the debate on Vietnam and the situation which exists in that tragic country at the moment. This Government is not doing all it should be doing to alleviate the human suffering which is being experienced in South Vietnam and Cambodia. I urge the Government to do everything in its power to see that an international presence is maintained in those Communist controlled areas of Vietnam and Cambodia to ensure that a level of sense is made to prevail, particularly in the case of the political situation that will follow the military situation that exists at the moment. Australia presently has diplomatic representation in Hanoi and Hanoi has diplomatic representation in Australia. The Australian Broadcasting Commission news tonight reported that the Australian Government has already recognised the Khmer Rouge, which has now taken control in Cambodia. The government with Prince Sihanouk as its titular head seems to be in control of that country at the moment and Australia, within hours, has recognised it. But we have that representation with Cambodia and tomorrow the Ambassador who has formerly represented the Lon Nol Government, will raise the flag of the Sihanouk Government in Canberra, and a representative of the Australian Government should be on his doorstep when he opens for business tomorrow morning. The Australian Government should be there to seek an international presence in Cambodia.

In the interests of humanity, it is important that there be international supervision and control in those areas which are now under communist control. At the moment a military situation exists and obviously tragedy and human suffering surround that situation. Unnecessary slaughter is going on on a large scale in those communist controlled areas and in the areas that are under military dispute. A political situation will follow the military situation. We are experiencing now the tragedy of war and we will be experiencing soon the tragedy of what will be called a peace. At the moment we have the problem of war orphans, of those who are suffering and of those who are seeking to leave those areas which are under communist control. We recently saw the situation in Da Nang where thousands and thousands of orphans and potential refugees were allowed to die while waiting for their allies, as they thought them to be, who failed to go and get them- who let them down in their most desperate hour of need. The air forces of Australia and of some of our other allies have been prevented from going into that war torn area to bring out the people who are the innocent victims of the crisis. We seem to have an air force which will not go anywhere where it might be put at risk. I put it to honourable members that in these circumstances one has to be prepared to accept losses if one is to be able to offer any significant assistance at all.

The tragedy of the peace- the so-called peace- that will follow the wave of military activity which is now taking place is something which concerns me greatly. In 1955, after the Geneva Accords of 1954 during the 300-day cease fire and after that cease fire, the world saw the greatest slaughter that has ever been seen in a situation of that nature.

In 1955-56 the North Vietnamese engaged in a program of land reform. In North Vietnam then a wealthy landholder was one who had perhaps three or four acres, and there was a need to satisfy the supporters of the North Vietnamese regime and to provide them with land. What was done in that country was a disgrace. Kangaroo courts were set up by local people who were prepared to stand up and swear crimes against those landholders who held those small acreages in that country. They trumped up charges against them and had them executed. The estimates of those executed range in number from a minimum of 15 000 to in excess of 100 000. That was done by a government which is still the government in control of those areas of North Vietnam and which is behind the Vietcong who are pushing down further and further into South Vietnam. That is the Government which is being supported by the Whitlam administration in Australia today. That is the Government which we are not allowed to offend. That is the Government with which we must be more than evenhanded in our international dealings.

The situation of countless thousands of people being slaughtered in the past will obviously occur again under the same administration. Australia has a responsibility as a country which has representation at the United Nations, in North Vietnam as well as in the new Cambodian regime of the Khmer Rouge and Prince Sihanouk, to see that it does what it can to establish an international presence in those countries, to see that the Red Cross organisation is there, that United Nations representatives are there and that peacekeeping forces are in those countries and in the troubled areas during the period of what will be termed peace- and peace it will be indeed. I suggest more people will be slaughtered in that political settlement that will follow the military situation than there have been slaughtered in the military forays that have been occurring in the last 20 years.

We will see a revolution of monumental proportions in what we now know to be South Vietnam. This Government has a responsibility to go into those areas and to do everything it can in the international forums to see that this does not happen. The Iron Curtain will be brought down, the journalists will be put out and wholesale slaughters will take place. We will not know about this until years to come when the news will filter through to the free world. We have to see that this does not happen. This is a situation in which humanity is concerned and where individual liberty is at stake. If this Government is prepared to stand up and support these sorts of principles it has to go out into the world forums and argue for them and fight for them. We have to support the United States and the President in his present efforts to see that the American presence is maintained and that American aid continues. We have to see that these people are not allowed to be shut behind an iron curtain and subjected to wholesale massacre and slaughter.

The instances that I spoke of earlier of the land reform that took place in North Vietnam will be repeated. It is this Government’s responsibility to see that we do not allow it to happen. The ambassador who formerly represented Lon Nol in Australia will be opening up under a new flag tomorrow morning. The Department of Foreign Affairs should be on his doorstep at 9 a.m. putting the Australian Government view, which the Australian people support, that we should be providing in Phnom Penh at the moment international forces which will supervise what will be called the peace, the international presence which will see that wholesale slaughter is not allowed to continue.

We have to see that this Government takes a much more rational approach to the whole question of what is happening in the South East Asian forum at the moment. Our Deputy Prime Minister (Dr J. F. Cairns) is prepared to make public statements in support of a government which is in the history books as one which has carried out wholesale slaughter. Members of that government are Stalinists and they operate on the same principle that Stalin used in the purges in Russia. The land reforms and the slaughter that were involved in that situation in 1955 and 1956 should open the eyes of Australians and the world to the type of administration that is in control in that country.

Before my time expires I make this final plea. Australia should do everything it can in the world forums, in the United Nations and in the South East Asia forums to which we have access, to see that it plays its part in maintaining a presence to ensure that the innocent people in South Vietnam and Cambodia are not subjected to wholesale massacre and slaughter such as occurred after the Geneva Accords of 1955-1956.


– It is somewhat unusual to find the Government ranks so thinned that nobody from that side is prepared to make a speech in the adjournment debate. I rise tonight to draw the attention of the House to an important component of the Australian economy that has received scant attention from the present Government- attention so scant, in fact that I believe that this vital part of the private sector of commercial operations in Australia has been neglected and prejudiced, in many cases to the point of virtual destruction. I refer to small business. Some of the honourable gentlemen sitting opposite me at the moment no doubt would dispute the importance of small businesses to the Australian economy but I would remind them that if one accepts the definition of small firms as those employing less than 100 people then 93 per cent of all manufacturing establishments, and probably an even higher percentage of retail and service businesses, would fall into this category. It takes a lot of courage, effort and initative to start a business at any time but particularly today. As Mr Williams, a senior lecturer in small business management at the University of New England, recently said:

The sheer size of the small business population is impressive enough, but if one seriously considers the odds against the successful establishment and operation of a small business venture the wonder is that the sector is as large and vigorous as it is.

I do not believe it is acceptable or even moderately tolerable for the Government to consider the alarming figures of small business failures as either unimportant or undeserving of serious concern. I suppose we have to ask: Why should small businesses be granted special considerations when other sections of the economy, for example, the multi-national concerns, are being overtly constrained in their operations by this Government? The answer to that is simple. Small businesses per se have no inalienable right to expect clumsy management, financial ineptitude or economically non-viable products to be granted some kind of charitable reprieve. But there are certain principles, certain undeniable and long established traits of the Australian character, that appear to demand not only the continuation but the active encouragement of the small business.operation.

It is easily discernable that the people of Australia place a heavy regard on the opportunities of enterprising initiative. Take away that initiative and you remove the desire for success, you remove the true potential of competitions, and you remove some real possibilities of productivity development and economic growth. In a multiplier-effect economy such as Mr Milton Friedman outlines this capacity for prime-cause initiative is not just one requirement, it is fundamental to the very process of productivity. The ruggedly established independence of the Australian character would be sadly deprived if this same opportunity to reach commercial success, to work hard and establish an efficient company or service, were in any way denied by academics who are far too prone to theorise, or governments such as the present one ideologically committed to extending the domain of the public sector.

For these reasons I have tried to outline the philosophical position of small businesses but I also would Uke to offer a number of possible solutions to the current problems faced today by small businesses which are fundamentally ones or finance and management efficiency. I fully support the introduction of the enterprise counselling assistance program to assist management operations of small businesses. This scheme certainly attempts to fill the need that many younger ventures find for advice in management directions and efficient planning.

What of the other easily effected measures the Government could be initiating to support the small businessman? The most obvious, of course, is tax relaxation. In the United States of America, in the aftermath of a series of anti-trust legislation, it has been enacted that company tax on firms earning less than $25,000 is 25 per cent as opposed to the normal 48 per cent. Further, the United States Government allows retention of tax profits of up to $100,000 before becoming liable to retained earning tax. Surely this is a more equitable way of preserving this vital component of the economy. Larger corporations generally are more capable of coping with financial problems such as inflation and high interest rates but the smaller concerns are devastated- there is no other word for it- by inefficient economic management as demonstrated by the present Government.

Another area of assistance to small business that bears investigation is again taken from the American experience. It is the policy of awarding Government contracts of less than $500,000 to small firms. Obviously multi-million dollar projects will be out of the scope of most small businesses but contracting to small concerns for the more minor enterprises not only prevents the undesirable establishment of Government patronage and payola from taking place, it also encourages the small businesses to compete and strive towards greater productivity.

Another measure which appears to have worked well in the United States of America in the management advice and assistance line is the SCORE scheme which effectively utilises the services of retired but thoroughly experienced business executives. There is in the community a vast reservoir of talent which is not being utilised at the moment. This reservoir of talent comprises these retired business executives who have a great deal of productive capacity left in them. The serious problems with which small businesses in Australia are faced today are due in large part either to a deliberate policy of the Government to destroy this sector of the economy or to the Government’s inadvertence and appalling unawareness of the difficulties which small businesses are experiencing. Either position displays a reprehensible irresponsibility on the part of the Labor Government.

I reiterate that not only I but all members of the Liberal Party and the Country Party believe in the continuation of a vibrant and productive private sector. As I said at the beginning of my speech, small business is the backbone of a productive private sector. I urge the Government to take immediate steps to overcome the present disparity in the tax burdens of private and public companies, firstly, by allowing an increase in company retention allowance when it can be demonstrated that retained funds are being put back into the business; secondly, by instigating a provision for a taxation deduction to enable small companies to be adequately covered for expenditure on superannuation; and further, by allowing past losses to be carried back over the previous 3 years tax paid, as is allowed in the United States of America and Canada.

These are some propositions which deserve greater consideration than they have had so far by this Government. I hope the Government realises that if it runs out of time in which to implement these proposals the consequences for small businessmen all over Australia and the thousands of people they cumulatively employ would be absolutely disastrous. As I stated at the outset, small businesses employing less than 100 people comprise over 93 per cent of our manufacturing establishments. I believe very strongly that these people are facing immense problems under the economic difficulties which currently beset Australia. If we neglect them, if we allow them to go out backwards, if we destroy the initiative, enterprise and opportunities for success, then not only these people but Australia as a whole will really be disadvantaged.

Northern Territory

-At this late hour -

Government members- Ha, ha!


– Honourable members opposite may well laugh. I intend to speak about something relating to the Northern Territory in which it appears those sitting on the Government front bench are not interested. They will say that I do not know what I am talking about because I do not live there. They have said this sort of thing repeatedly. They are two-bitters, to use our expression.

Mr Daly:

– That is repartee.


– Quite so. My expression applies to the Minister also. Tonight I wish to speak about the Government’s attitude to the Legislative Assembly of the Northern Territory. This Government is supposed to be interested in the further development of self-government for the Northern Territory. Today neither I nor certain other honourable members were allowed to speak during a debate in this House. However, this has nothing to do with the matter I am raising.

The Commonwealth Government is shortcircuiting the Northern Territory Legislative Assembly whose members the people of the Territory voted for and elected in October of last year. The Prime Minister (Mr Whitlam) said that there would be a fully elected Legislative Assembly by the end of December. That body has been established. But up to date- we are almost a quarter of the way through this yearthe members of the Assembly who have been elected by the people of the Northern Territory have not really been given any authority or any executive power. I notice that the laughing members opposite are not laughing now- they are chatting among themselves.

The Government is waiting for the Joint Parliamentary Committee on the Northern Territory to supply the answer. But it is utter nonsense to approach the matter in this way. The Minister for the Northern Territory (Dr Patterson) and the Government are the ones who should have supplied the answer to what are the responsibilities of the Northern Territory Legislative Assembly. The Prime Minister and the Government said that we would have a fully elected Assembly by December 1974. The candidates of the Labor Party were defeated utterly at the election for the Legislative Assembly. That party holds no seats in the Assembly. I ask the Minister, in spite of this tremendous defeat which the laughing squibs on the front bench opposite -


-Order! I would suggest that the honourable gentleman -


– I would suggest that they are squibs.


-Order! I suggest that the honourable gentleman address his remarks through the Chair.


-Certainly. Mr Speaker, through you, I refer to the laughing squibs on the front bench. I would like again to point out to honourable gentlemen that the Government promised that there would be a fully elected Legislative Assembly by December 1974 and that this body would have some sort of authority. Although it is now April 1975 this promise has not been carried out.

I remind the House that numerous Bills which have been dealt with in this Parliament have not been referred to the Legislative Assembly. This is typical of the Government’s attempt to undermine local authority in the Territory. The people of the Northern Territory were given no advice of the Darwin Reconstruction Bill until it was introduced into this place. It is incredible to think that the Government was not prepared to even give the local people any chance of speaking about that legislation. Nevertheless, the Opposition was able to make some amendments to the Bill.

The Government also rejected Darwin emergency legislation in respect of which a majority of all members of the Legislative Assembly had approved certain action concerned with restraining or not restraining the entry of people into Darwin. This Bill was turned around by the Minister. He rejected it in the face of the people who were elected by the citizens of the Northern Territory, and Darwin in particular. So the whole decision was utterly reversed. After all, the Prime Minister said that there will be a fully elected Legislative Assembly. The Joint Committee on the Northern Territory has advised the Government on various things, but what has happened? The Legislative Assembly makes a decision and the Minister reverses it. This is completely ridiculous. It is not acceptable. Further, there is the Darwin Land Valuation Bill under which this Government- this centralist Governmentdecided that there would be valuations.

Dr Klugman:

– You are tick-tacking now.


– Go up there and wake up, you crumb. Do a bit more tick-tacking and you will do better. Through this Darwin Land Valuation Bill this Government in Canberra was telling the people in the Darwin area what the value of land should be or what they should accept for land in an area within a radius of 96 kilometers. Let us face it: This Government is telling the people of the Northern Territory what is supposed to be the value of land on Bathurst Island. Honourable members opposite are supposed to be a mob of Aborigine supporters. They are telling this to people at Wagait or on Bathurst Island. What could be worse? This Government should be allowing these people to have a say in their own affairs. This is what was supposed to have been recommended and what was supposed to have happened. But, no, the centralists refused to allow this to happen. All right, that Bill went through. Seeing that the light indicating that I have one minute left is now on, I would like to say -

Mr Daly:

– They will soon be on their way.


-Let me tell you: You will be on your way if you get up there, too. The Committee to which I have referred recommends that the control of the Northern Territory Police should be handed- this is published- to the Assembly. But what happens?


-Order! The honourable gentleman’s time has expired. His last remarks will not be recorded.

Mr Donald Cameron:

– There is one question: What right has the control board to turn the honourable member for the Northern Territory off the air, as was done a moment ago?


-I suggest that the honourable gentleman might be aware that I had already said that the honourable gentleman’s time had expired. He is not entitled to address this House after his time has expired.

Minister for Services and Property · Grayndler · ALP

– I rise to reply in the few seconds available to some of the false charges of the honourable member for the Northern Territory (Mr Calder). No Government of our time has ever done more for the people in the Northern Territory than the Labor Government. In fact we gave their representative a full vote in this Parliament and the honourable member for the Northern Territory always opposed the proposition. He spoke one way and voted another. Of course, he has a peculiar arrangement with the Australian Country Party. He can say what he likes outside this Parliament as long as he votes with the members of the Party inside the Parliament. The representative of the people of the

Northern Territory would not have had a vote in this place had it not been for the Labor Party. In addition, after the cyclone Tracy disaster this Government moved with speed to assist the people of the Northern Territory in a way which was commendable and which no Liberal government could ever have done. The honourable member made a violent, vicious and personal attack on us Ministers sitting here tonight. It disturbs me to think that an honourable member who should uphold the dignity of this place stoops to mix dirt at such a late hour.


-Order! It being 1 1 p.m., the House stands adjourned until 2.15 p.m. on Monday.

House adjourned at 11 p.m.

page 1847


The following answers to questions were circulated:

Crimes Act (Question No. 736)

Mr Snedden:

asked the Attorney-General, upon notice:

  1. 1 ) Did the present Minister for Labor and Immigration say, with the authority of the present Prime Minister, on 17 September 1972, that a Labor Government would adopt the 1970 submission of the Council of Commonwealth Public Service Organisations to amend section 70 of the Crimes Act to render it a criminal offence to disclose classified information about the Service or business of the Service.
  2. If so, has this been done; if not, why not.
Mr Enderby:

– The answer to the right honourable member’s question is as follows:

  1. 1 ) and (2) The Government intends to introduce amendments to section 70 of the Crimes Act along the lines recommended in the United Kingdom by the Franks Committee. Section 70 presently prohibits generally the disclosure of official information. The Franks Committee recommended that a person should be liable to prosection only where the information falls within certain specified categories of confidential information.

Noongah’ Fund (Question No. 1539)

Mr Malcolm Fraser:

asked the Minister for Transport, upon notice:

  1. What occurred between 25 October 1974 when he signed a letter to me, in which he said the Noongah fund could be involved or could fall within the terms of reference of Justice Sweeney’s inquiry, and 30 October, 1 974 when it is reported that, to his knowledge, as far as the Noongah fund is concerned, it has nothing to do with the inquiry.
  2. If there are constitutional problems, as stated in his letter, that prevent him discovering what payments have been made into or out of that fund, how could he know that the fund has nothing to do with the inquiry.
Mr Charles Jones:
Minister for Transport · NEWCASTLE, VICTORIA · ALP

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

  1. 1 ) and (2) Based on advice received by my Department from the Crown Solicitor’s office I indicated in my letter of 25 October to the honourable member that the matter (of Noongah fund) ‘could fall within the terms of reference of Judge Sweeney’s Inquiry’. Obviously this could only be determined after an examination of the facts by the Royal Commission. I further said in answer to a question without notice on 30 October 1974 that as far as I was aware the Noongah’ fund had nothing to do with the Inquiry.

Clearly, that was not an unequivocal statement that the Noongah fund had nothing to do with the Inquiry. The answer I gave on 30 October reflected the fact that I had no direct knowledge of any matters which called for an inquiry into payments into and out of the Noongah fund which was the subject of the honourable member’s question without notice on 1 6 October and of my letter to him on 2 5 October. I find nothing inconsistent in the two answers.

As the honourable member is no doubt aware, Judge Sweeney’s Inquiry has heard evidence of a demand made by the Seamen’s Union for the crew of the vessel ‘Manchester

Vigour’ to be paid Australian rates of pay, but when the crew, by letter to the Union indicated that they did not want the additional payment, the owners were asked to make the payment to the Noongah Memorial Fund. A cheque for $3456 made payable to the Noongah Memorial Fund was handed to the Secretary of the Western Australian Branch of the Seamen’s Union on 15 November 1973. That cheque was subsequently paid into the Peace and Progress Fund of the Seamen’s Union.

The reasons for that action having been taken were given in evidence by the Secretary of the Noongah Disaster Committee when she appeared before the Royal Commission on 2 December 1974. At the same time the Secretary of the Noongah Disaster Committee tendered to the Royal Commission all documents of account relating to the Noongah Disaster Fund and asked that if the Commission finds that the Noongah Disaster Committee is not involved in any way, the Commission make that clear so as to erase any doubts that have been created. Mr Justice Sweeney indicated at the time that ‘there will be a full finding made on it one way or another’.

Legal Defence Services Committee of Review: Report (Question No. 1915)

Dr Forbes:

asked the Minister for Defence, upon notice:

  1. With reference to his answer to question No. 1463 (Hansard, 27 November 1974, page 42 17) how many of the officers referred to in part (2 ) of the answer are lawyers.
  2. How many lawyers are employed (a) part-time and (b) full-time on defence procurement from the United States of America in (i) the Department of Defence and (ii) the Attorney-General ‘s Department.
  3. How many lawyers were employed (a) part-time and (b) full-time on defence procurement from the United States of America in (i) the Department of Defence and (ii) the Attorney-General’s Department as at 30 June 1971, 31 December 1971, 30 June 1972, 31 December 1972, 30 June 1973, 3 1 December 1973 and 30 June 1974.
Mr Barnard:

– The answer to the honourable member’s question is as follows: (1), (2) and (3) In my answer to Question No. 1463 I stated that there are officers in the Department of Defence and the Attorney-General’s Department who are knowledgeable in United States procurement law.

In relation to the Department of Defence or the Defence Group of Departments, that was also the position throughout the period covered by the honourable member’s question.

To the extent that the Question relates to the AttorneyGeneral’s Department, it is a matter for the AttorneyGeneral.

Department of Defence: Research and Development Staff (Question No. 2024)

Mr Snedden:

asked the Minister for Defence, upon notice:

When will he answer my question No. 1240 which first appeared on the Notice Paper on 3 October 1974.

Mr Barnard:

-The answer to the right honour- - able member’s question is as follows:

I refer the right honourable member’s attention to the answer provided to question No. 1240 (Hansard, page 1446-7 of 9 April 1975).

Patrol Boats (Question No. 2353)

Mr Snedden:

asked the Minister for Defence, upon notice:

  1. How many patrol boats will be provided from the Third Australian Patrol Boat Squadron in order to institute increased coastal fishing surveillance.
  2. In what areas will they operate.
Mr Barnard:

– The answer to the right honourable member’s question is as follows:

  1. Four patrol boats are currently operating with the Third Patrol Boat Squadron on fishing surveillance. Of these, HMAS ‘Aware’ which has been temporarily assigned to the Squadron, returns to Jervis Bay in May for Search and Rescue and other duties. Consequent, upon damage caused by cyclone Tracy HMAS ‘Attack’ is undergoing repairs at Cairns and is expected to rejoin the Squadron in October.
  2. The Third Patrol Boat Squadron, periodically augmented by the reserve manned patrol boat HMAS ‘Acute’ operating from Fremantle, is responsible for fishery surveillance of the coastal area from North- West Cape to Gove Peninsula.

Baltic Republics (Question No. 2238)

Mr Snedden:

asked the Prime Minister, upon notice:

  1. 1 ) Did he receive a telegram from members of the Help Estonian, Latvian and Lithuanian Peoples Association (HELLP) following a public meeting in Hobart on 5 December 1974.
  2. If so, did the telegram ask him to inquire about the fate of 5 Lithuanians imprisoned in the Soviet Union.
  3. Did the telegram also ask him to seek the immediate restoration of civil liberties in the 3 Baltic States.
  4. What action did he take on these requests.
  5. On what date did he reply to the telegram from HELLP.
Mr Whitlam:

– The answer to the right honourable member’s question is as follows: (l),(2)and(3)Yes.

  1. I did not have the opportunity to make specific representations to the Soviet Government about imprisoned Lithuanians during my recent visit. I did, however, as I reported to the House on11 February 1975 (Hansard, page 65) take up a number of humanitarian questions with the Soviet Prime Minister, Mr Kosygin, pointing out that public concern in Australia about such issues could affect bilateral relations between Australia and the USSR.
  2. By letter on 19 December. A further telegram of 24 January 1975 was acknowledged by letter on 6 February and answered by letter on 10 March.

Cite as: Australia, House of Representatives, Debates, 17 April 1975, viewed 22 October 2017, <>.