House of Representatives
24 May 1978

31st Parliament · 1st Session

  1. House of Representatives
  2. 31st Parliament
  3. 1978

Mr SPEAKER (Rt Hon. Sir Billy Snedden) took the chair at 2. 1 5 p.m., and read prayers.

page 2383

PETITIONS

The Clerk:

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

Medical Benefits

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 Item 6469 of the standard Medical Benefits Table is the means by which payment is made for the slaughter of thousands of unborn babies every year.

Your Petitioners therefore humbly pray that the Government should ensure that Item 6469 is removed from the standard Medical Benefits Table.

And your petitioners as in duty bound will ever pray. by Dr Cass, Mr Falconer, Mr Holding, Mr Roger Johnston, Mr Peacock and Mr Staley.

Petitions received.

Pensioners: Home Maintenance Loans

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

That it is necessary for the Commonwealth Government to renew for a further term of at least 3 years the States Grants (Dwellings for Pensioners) Act 1974/77, renewed for one year expiring on the 30th June 1 978.

The demand for dwellings has not slackened as the waiting list (all States) of 12,060 single and 4,120 couples as at the 30 June 1977, showeth.

Your petitioners respectfully draw the attention of the Commonwealth Government to the Report of the Committee of Inquiry into Aged Persons’ Housing 1975 under the Chairmanship of the Rev. K. Seaman (now Governor of South Australia) which recommended additional funds to State housing authorities to meet the demand for low-rental accommodation in the proportion of $4 for $ 1 with the proviso that the States do not reduce their existing expenditure and

That the Act include married pensioners eligible for supplementary assistance and migrants as specified by the Seaman Report and that particular consideration be paid to the special needs and requirements of the prospective tenants in the location and design of such dwellings.

Furthermore, your petitioners desire to draw the Government’s attention to the hardship of many pensioner home owners caused by the high cost of maintenance.

The Social Security Annual Report 1976/77 shows that 24.6 per cent, or 283,000 home owning pensioners, have a weekly income in excess of the pension of less than $6 per week.

Your petitioners strongly urge the Commonwealth Government to establish a fund whereby loans can be made to means tested pensioners for the purpose of effecting necessary maintenance to their homes. Such a loan to be at minimal interest rates sufficient to cover administrative costs and to be repaid by the estate upon the death of a single pensioner before probate or upon the death of the surviving spouse in the case of married pensioners or where two pensioners jointly own the dwelling.

Administration to be carried out by local government bodies.

And your petitioners as in duty bound will ever pray. by Mr Holding, Mr Barry Jones, Dr Klugman and Mr Ian Robinson.

Petitions received.

Aboriginal Land Rights

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 the Federal Government recognise land rights in the States, such as Queensland, in a similar manner to the recognition of land rights in the Northern Territory i.e. enact an Aboriginal Land Rights Act for Queensland;
  2. That the Federal Government support the abolition of the Aborigines Act (Queensland) 1971 and the Torres Strait Islanders Act (Queensland) 1971 and take such action as they may deem necessary to ensure that the provisions of the Queensland Discriminatory Laws Act 1 975 and the Racial Discrimination Act 1 975 be enforced in so far as they relate to Aborigines and Islanders;
  3. That the Federal Government assume responsibility for Aboriginal Affairs in Queensland under the powers given them by the Referendum of 1 967. The State Department of Aboriginal and Islander Advancement Queensland should be abolished and Aboriginal and Island reserves in Queensland should have the choice to be self-governed with local government status. by Dr Everingham and Mr Thomson.

Petitions received.

German Insurance Companies

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

That since the introduction of Medibank, on 1 July 1975, the German Insurance Companies, have stopped paying their monthly contributions of DM 115. to German pensioners residing in Australia. This money was provided so that those people could privately insure themselves and pay for medical prescriptions.- We note, that our Australian Health Funds, HBA, ANA, Manchester Unity et cetera have to meet their liabilities.- It is for this reason, that we protest, that a foreign Health Fund should be exempt from meeting its liabilities at the expense of the Australian taxpayer.

Your Petitioners therefore humbly pray that our gracious Government and the Government of West Germany, will reach an amicable agreement, which will justly foot the bill, to the Insurance Co. that received the premiums.

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

Petition received.

Citizen Forces: Long Service and Good Conduct Medals

The Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble Petition of the undersigned members and ex-members of the Citizens Forces of Australia respectfully showeth:

  1. On 14 February, 1975, the then Australian Government deprived the Officers and men of the Australian Citizen Naval Military and Air Forces of the distinctive and historic Decorations and Medals for long service and good conduct, namely the Reserve Decoration, the Efficiency Decoration, the Air Efficiency Award, the Efficiency Medal and Long Service and Good Conduct Medals, awarded for long and meritorious voluntary service in the citizen forces:
  2. The proposed substitution of the National Medal for these Decorations and Medals varies the principle of selective recognition of efficient voluntary service in the citizen forces in that it recognises the period of service only and embraces also full time service as well in the defence forces as in the police, fire brigade and ambulance services:
  3. This deprivation caused and is continuing to cause serious discontent amongst personnel of the Citizen Forces who willingly and cheerfully give of their spare time outside their normal full time civilian careers, to serve Her Majesty and Australia:
  4. The Reserve Forces of Australia have been recognised by the present Government as a valuable- and costeffective component of the Defence Forces. Anomalously, whilst the Government is actually supporting recruiting for these Forces it has imposed and continued this deprivation which as aforesaid has depressed the morale of the Citizen Forces:
  5. Her Majesty has not cancelled the said Decorations and Medals. Your Petitioners therefore humbly pray.

Your Honourable House take appropriate action to resume the award of the several distinctive Reserve Forces Decorations and Medals for Long Service and Good Conduct to members of the Royal Australian Naval Reserve, Army Reserve (C.M.F. ) and the R.A.A.F. Citizens Air Force. by Mr Aldred.

Petition received.

Schools Commission

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 ) The present level of Federal Government Education Expenditure is increased to the level recommended by the Schools Commission.
  2. ) The role of the Schools Commission as an independent statutory authority free to make its own assessment of the needs of Australian Education is maintained.

Your petitioners therefore humbly pray that the Government will take no measures to interfere with the Schools Commission.

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

Petition received.

Taxation: Subsidised Housing

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble

Petition of undersigned citizens of Australia respectfully showeth:

That we are shocked by the Federal Government’s expressed intention to legislate for changes to the taxation laws to provide a tax on people living in subsidised housing.

Your Petitioners therefore humbly pray that legislation to tax people living in subsidised housing not be enacted.

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

Petition received.

Radio Examination

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble Petition of undersigned electors of the Division of Kalgoorlie respectfully showeth:

Our dissatisfaction at the failure of the ‘Regulatory and Licensing’ branch to provide a ‘Novice Radio Amateur’ examination in Kalgoorlie.

Your Petitioners therefore humbly pray that some local body be appointed to perform this relatively simple task.

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

Petition received.

Broadcasting and Television

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 because television and radio:

  1. a ) affect our social and moral environment,
  2. are family media watched and heard by many children at all times, and
  3. present too much explicit violence and sex, they therefore need stronger control than other media and the existing standards need stricter enforcement in both national ABC, and commercial sectors.

Your petitioners therefore humbly pray:

That the Australian Government will amend the Broadcasting and Television Act, in relation to both national and commercial broadcasters, to legislate:

  1. for adequate and comprehensive programs in the best interests of the general public,
  2. for a ‘Dual System of Regulation’ enforced by the Australian Broadcasting Tribunal by Internal regulation and external control.
  3. for an independent consumer body to represent the best interests of the general public, and
  4. for immediate and effective penalties to be imposed for breaches of program and advertising standards.

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

Petition received.

Air Fares to North America and Europe

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 since Australia has such a large component of the population as migrants and also is far removed from Europe and North America that the practice of less expensive Air Fares to and from Australia should follow. It is expected that this will greatly benefit the average citizen and Australia’s Tourism Industry on a yearly basis. This will also make the best possible use of the dwindling petroleum fuel resource and in line with safety standards.

Your petitioners most humbly pray that the House of Representatives in Parliament will take immediate steps to implement less expensive Air Fares for the North American and European Sectors.

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

Petition received.

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: objection to the metric system and request the Government to restore the imperial system.

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

Petition received.

Assistance to Grape Growers

To the Honourable the Speaker of the House of Representatives in Parliament assembled. The humble petition of citizens of the Commonwealth respectfully showeth:

Upper Murray Grapegrowers Association.

Petition to be presented to Federal Parliament:

We the undersigned residents of the Riverland call on the Federal Government to compensate grapegrowers to leave this year’s surplus grapes on the vine, to stop all subsidised wine and brandy imports until the surplus grape problem is solved, to stop taxing the grapegrower out of existence, and to reduce excise on Australian brandy.

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

Petition received.

Brandy

To the Honourable the Speaker of the House of Representatives in Parliament assembled. The humble petition of citizens of the Commonwealth respectfully showeth:

That we, citizens of the Commonwealth, earnestly request our Government to protect the interests of Australian grape growers by:

  1. Lowering the excise duty on brandy produced in Australia.
  2. Reducing the quantity of imported brandy on the Australian market which is adversely affecting Australian producers.
  3. Abolishing sales tax on brandy.

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

Petition received.

Immunotherapy Clinics

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

That we believe that the Minister for Health should support the principle that Australians have the right to seek Immunotherapy treatment for Cancer and that we support any moves to expand research into, and the setting up of clinics for Immunological management of cancer within Australia.

Your petitioners therefore humbly pray that all support be given to the establishment of Immunotherapy clinics in Australia thus giving Australian cancer patients a choice in the management of this disease. by Mr Hodges.

Petition received.

Aged Persons Accommodation

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 surveys reveal a substantial percentage of adults over the age of 55 years in the Loftus-Engadine-Heathcote and Waterfall areas of the Hughes electorate, are in urgent need of special housing and nursing home accommodation.
  2. That many families in the area are experiencing difficulty in the placing of their aged parents in suitable nursing care; many cases having to be placed in care many kilometres from their families and consequently causing great strain on the relatives concerned.
  3. That this problem is aggravated by this area’s geographical and public transport isolation from the rest of the Sutherland Shire.
  4. That Government subsidised nursing homes in other parts of the Hughes and Cook electorate have Jong waitinglists and in fact, have closed their lists to further inquirers.

Your petitioners most humbly pray that the House of Representatives in Parliament assembled will:

  1. Acknowledge that there is a need for the construction of an aged persons complex in this area as already acknowledged by the Federal/State Co-ordinating Committee for Nursing-Home accommodation in N.S. W.
  2. Take immediate action to provide sufficient funds in the current financial year to finance the construction and maintenance of an aged-persons complex, providing hostel and nursing bed accommodation in this area.

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

Petition received.

Children’s Hospital

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

We mothers of Penrith and the Outer Western Suburbs feel most vehemently that a childrens hospital should be established within this area, operating on the same principles as Royal Alexandria Hospital, Camperdown, allowing mothers to remain with their children for the duration of their hospitalisation. If a Childrens Hospital were not feasible then we would submit that Nepean Hospital should be extended to provide these facilities, ‘

And your petitioners as in duty bound will ever pray. by Dr Klugman.

Petition received.

Rhodesia Information Centre

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

  1. That Rhodesia is a peaceful country now under attack by communist-backed terrorists.
  2. That the U.N. directive to close down the Rhodesia Information Centre in Sydney should be disregarded.
  3. That there should be a free flow of information from other countries.

Your petitioners most humbly pray that the House of Representatives in Parliament assembled will guarantee the right of the Rhodesia Information Centre in Sydney to remain open.

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

Petition received.

Television Services in Warburton Area

To the Right Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of the township of Warburton in the electorate of McMillan respectfully showeth:

Whereas:

  1. Since the introduction of television into Australia twenty-two years ago, one half of the residents in the township of Warburton in Victoria have not been able to receive a viewable picture.
  2. The Community Television Antenna System (CTAS) could be introduced into the Warburton area to remove this inability and provide television to all those wishing to view that means of community education and entertainment.

Your petitioners therefore humbly pray that the Government of the Commonwealth of Australia per medium of the Minister for Post and Telecommunications give all directions to ensure the installation of all equipment necessary to instal CTAS or such other means to produce television viewing for the citizens of Warburton.

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

Petition received.

National Family Policy

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

That ‘The family is the natural and fundamental group unit of society and is entitled to protection by society and the state’.

Your petitioners therefore humbly pray that the government initiate a national family policy and use the concept of family impact statements as a means highlighting family needs.

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

Petition received.

page 2386

QUESTION

QUESTIONS WITHOUT NOTICE

page 2386

QUESTION

NORTH WEST CAPE COMMUNICATIONS STATION

Mr John Brown:
PARRAMATTA, NEW SOUTH WALES · ALP

-I direct a question to the Minister for Defence. In answer to a question on 1 1 May the Minister stated that a satellite terminal was removed in 1973; that it was replaced in October 1977; and that there is now a United States proposal to upgrade that facility in 1980-81, subject to the proposal being acceptable to the Australian Government. As that answer was the same in essence as the considered answer given by Senator Withers in the Senate and as both answers were incorrect in fact, will the Minister inform the House from what source the information was derived and why in a considered answer incorrect information was given to the Parliament?

Mr KILLEN:
Minister for Defence · MORETON, QUEENSLAND · LP

– I can assure the honourable gentleman that the answer I gave to this House on the 1 1th of this month was correct in each and every particular. The answer that my colleague Senator Withers gave to the Senate on this matter was in reply to a question which, with very great respect to the questioner, was a most imprecisely worded question and the honourable gentleman was misled. He came to the Senate in a most forthcoming manner and said that he had been misinformed. He had answered the question regarding it as dealing with a solar observatory. That was simply not the case, and the honourable gentleman did what I regard as being the mature and manly thing and admitted that he was in error. As far as I am concerned, the House can rest assured that the answer I gave to this place on the 1 1th of this month was correct in each and every particular. I tell my honourable friend, I tell the Opposition: There has been no formal proposal placed before the Australian Government regarding the upgrading of this facility. When and if a formal proposal is placed before the Government it will be considered on its merits.

page 2387

QUESTION

STATISTICAL INFORMATION: SMALL BUSINESS SECTOR

Mr ALDRED:
HENTY, VICTORIA

– I direct my question to the Minister for Industry and Commerce. Is the Minister concerned about the lack of adequate statistical information concerning the small business sector in Australia and is he taking action to overcome that deficiency?

Mr LYNCH:
Minister for Industry and Commerce · FLINDERS, VICTORIA · LP

– The answer is in the affirmative. For some time the Government has been concerned about the inadequacy of material and research relating to the small business sector and the difficulty that this poses for the Government in the formulation of policy for that very important sector of the Australian economy. I can inform the House that the Bureau of Industry Economics will shortly be undertaking a mall survey of approximately 10,000 small businesses throughout Australia as part of its study of the profitability of small business firms and their access to development finance. The Bureau’s study is designed specifically to overcome the serious deficiency in information on small businesses and to improve general understanding and knowledge for the future. I am confident that the information that will be gained from the study will be of considerable assistance to the Government in the formulation of policy on small business. The objectives of the study have been strongly endorsed by a recent meeting of the Small Business Advisory Council, and I expect the questionnaires to be sent out some time in early June. I will be writing shortly to honourable members on both sides of the House to seek their support in undertaking that survey.

page 2387

QUESTION

NORTH WEST CAPE COMMUNICATIONS STATION

Mr SCHOLES:
CORIO, VICTORIA

-Did the Minister for Defence state on 16 May that the Government had taken the position that no statement officially commenting on the United States plans should be issued pending confirmation by the United States authorities of the Government’s existing understanding of those plans and their implications? When was the decision taken that no comments would be made? When was the Government’s required information received from the United States Government and if, as indicated by the Secretary of the Department of Defence, the information was not available in the policy areas of that Department as late as 1 1 May, when was that information considered by the policy committees within the Department of Defence and when were their findings conveyed to the Minister? Has the Minister indicated that approval for the station in principle has been given to the United States authorities?

Mr KILLEN:
LP

– In reply to the primary question, as I apprehend it amid the number of questions the honourable gentleman asked, namely, whether the Australian Government has given approval, the answer is no. No formal proposal has been placed before the Australian Government and when a formal proposal is placed before it it will be considered on its merits. I trust there is no ambiguity in that. As to what I said on the 16th of this month, I would hope that the honourable gentleman would do me the courtesy of reading the statement in full. The statement commenced with the following words:

No installation of any new terminal at North- West Cape will occur without the Australian Government having first been formally approached.

I have nothing to add to what I said in that statement.

Mr Stewart:

– Why has the contract been let?

Mr KILLEN:

– May I explain to the honourable gentleman who interjects that the contract that has been let relates to 2 1 satellite terminals. I want to make it, I trust, pluperfect clear to the House and to the country that no contract has been let regarding North West Cape, that is, Australian Territory.

Mr Barry Jones:
LALOR, VICTORIA · ALP

– That is past imperfect, not pluperfect.

Mr KILLEN:

– I am using ‘pluperfect’ as an adjective; I am not using it with respect to any tense. I am grateful to the honourable gentleman for his interjection. No contract has been let with respect to any installation that relates directly to Australian territory. I do not regard that as being a derogation of Australian sovereignty and I am immensely puzzled as to why the honourable gentleman who asked the question does.

page 2387

QUESTION

POWER INDUSTRY: SOUTH AUSTRALIA

Mr GRAHAM:
NORTH SYDNEY, NEW SOUTH WALES

-Can the Minister for Employment and Industrial Relations inform this House whether the Government proposes to take or has taken any action in respect of the decision of the South Australian Government to introduce a 37Vi hour working week into the power industry in that State?

Mr STREET:
Minister for Employment and Industrial Relations · CORANGAMITE, VICTORIA · LP

-The Government has already taken action in this area through the Conciliation and Arbitration Commission, but as I shall explain shortly this action has been circumvented. Applications for a shorter working week in the

South Australian power industry have been before the Full Bench of the Conciliation and Arbitration Commission for some time and the case has been delayed because of a pending High Court decision relating to whether the State Electricity Commission of Victoria could intervene in the proceedings. The Federal Government had already intervened and the submission that it made to the Full Bench of the Commission was along the lines that, firstly, granting these claims on productivity grounds- which was the argument put forward- would be contrary to the Commission’s decisions in the past, particularly in the General Motors-Holden ‘s Ltd case and the oil industry case; secondly, the claims were contrary to the wage indexation guidelines; and, thirdly, to grant such claims would be quite inappropriate in the present economic climate.

These claims can and should be settled before the Conciliation and Arbitration Commission. Instead, the South Australian Government has neglected the normal means of determining these disputes and, as I understand it, has allowed these claims to be granted by purely administrative action. A full examination of the implications of this needs to be made by the Commission, particularly when unemployment in South Australia is at its present serious level. As a result of this decision there will undoubtedly be pressures for a flow-on in other areas and the cost implications of this will jeopardise job prospects for the unemployed in South Australia. It will jeopardise the security of those employed in insecure jobs for the sake of benefiting those in a particular form of secure employment. In these circumstances I find it difficult to understand the decision of the South Australian Government.

page 2388

QUESTION

NORTH WEST CAPE COMMUNICATIONS STATION

Mr HAYDEN:
OXLEY, QUEENSLAND

– I ask a question of the Minister for Defence. It relates to his answer to a question directed to him by the honourable member for Corio. I remind the Minister that he said that no contract had been let for installations on Australian territory and I ask: How does he explain the letting of contracts by the United States Government to Philco-Ford for equipment which will be installed at and which will be used in communication with facilities at North West Cape? He has said that no formal proposals have been before the Government and I presume that no consideration of any proposal has been made by the Government. Is it the intention of the Government to ensure that any commitment undertaken strictly accords with the agreement covering the North West Cape? Can the Minister assure the House that approval has not been given in any form at all, in principle or in any other generalised or oblique way, in relation to this program either by his Department, himself or Cabinet?

Mr KILLEN:
LP

– I can give the honourable gentleman the assurances that he seeks. No approval has been given by the Department. I would regard it as improper for a Department of State to presume to exercise such responsibility. I am bound to say to the honourable gentleman that no such presumption has been forthcoming. I certainly assure him that no approval has flown from me, neither has any approval come from the Australian Government. I acknowledge the genuine interest that the honourable gentleman has in this matter and I assure him, in the bluntest and frankest possible terms, that what is envisaged will in no way seek to alter the role, function or activity of the station. It will be an upgrading.

Mr Hayden:

– Will it accord with the agreement?

Mr KILLEN:

– It is very much in accord with the agreement as I understand it. May I correct the honourable gentleman about the letting of contracts. I have already referred to the fact that 21 terminal satellite contracts in the United States have been let but that does not as yet- nor will anything under contemplation- affect Australian soil. That is the position. There is no contract as at this day of grace which affects Australian soil.

Mr Hayden:

-Will there be?

Mr KILLEN:

– I repeat that when a formal proposal is placed before the Australian Government it will be considered on its merits. Governments are not in the habit, I trust, of seeking to accept in futuro any proposal that may be in contemplation and may have been discussed. I remind the honourable gentleman that PhilcoFord has been referred to in connection with a synthetic authority by one correspondent for the Australian Financial Review. I assure him that that is not the contracting company. The contracting company for the terminals, which will go into a shed or what-have-you in the United States, has been let to Comtec Laboratories of Long Island in New York. That may be a minor point of correction. I sum up by saying that there is no proposal whatsoever, in existence to my knowledge, to the knowledge of the Australian Government or to the knowledge of the Department of Defence which would in any way alter the role or the function of the North West Cape base. I hope that is clearly understood by the honourable gentleman and by those who sit behind him.

page 2389

QUESTION

COUNTER-CYCLICAL BEEF IMPORT ARRANGEMENTS

Mr THOMSON:
LEICHHARDT, QUEENSLAND

-My question is directed to the Minister for Trade and Resources. What action has the Government taken to make known Australia’s concern about the proposed counter-cyclical beef import arrangements in the United States?

Mr ANTHONY:
Deputy Prime Minister · RICHMOND, NEW SOUTH WALES · NCP/NP

– I have answered a question in the House on the matter of the United States considering legislation which will be of a countercyclical nature. The disadvantage of such a proposal is that Australian industry would be left in a state of uncertainty as to the volume of exports that would take place each year. As I pointed out previously, the system applying last year would have meant a considerable reduction in the volume of our exports to the United States. So, because of our concern, we are using every opportunity of expressing our point of view to the United States administration, to the United States Senate and to the United States House of Representatives Ways and Means Committee. When Vice-President Mondale was out here the Prime Minister and I took the opportunity to explain our great concern about the matter. The Australian Meat and Livestock Corporation has presented written evidence to the United States Ways and Means Committee and I believe that the United States Administration has now submitted proposals objecting to that legislation. I would not believe that the United States would take such action as this at this time because meat prices are rising considerably in the United States. One would think that the United States would be looking to an increase of imports, not a restriction. At the same time, whilst there are great international discussions and conferences going on to try to bring about a greater liberalisation of trade, I would have thought that United States action in this regard would be just counter to that philosophy.

page 2389

QUESTION

NORTH WEST CAPE COMMUNICATIONS STATION

Mr LIONEL BOWEN:
KINGSFORD-SMITH, NEW SOUTH WALES

-My question is directed to the Minister for Defence. I refer by way of Preamble to the 1963 agreement relating to the use of the North West Cape and to Article 3 of that agreement, which provides for consultation between the two governments on all matters. I further refer to the Barnard-Schlesinger statement made in Washington in January 1974, which stated: . . - the Australian Government would have full and timely information about strategic and operational developments relevant to the station and their significance for Australian national interests.

Is it a fact that the current United States ballistic missile submarines are of a second strike or deterrent value? Is it a fact that the United States is developing new submarines and missiles known as Trident? Is the Minister aware that Trident missiles will have larger and highly accurate warheads which will provide a first strike, that is offensive rather than deterrent, capability? Will this not basically alter the role of the submarine force and the role and the utilisation of the North West Cape base? Accordingly, has this alteration been the subject of consultation with the United States under the terms of Article 3 of the North West Cape agreement as expanded by the Barnard-Schlesinger statement made on 10 January 1974?

Mr KILLEN:
LP

-The provisions of Articles 1, 2 and 3 of the agreement- particularly Articles 1 and 2 as amended in 1975- are, and will continue to be, respected. I adopt the language used by one of my predecessors in this House who belonged to the honourable gentleman’s Party. I refer to Mr Morrison who, on 21 August 1975, stated:

A lot has been said about the concept of control. The North West Cape station is not an originating station. The messages that go out to the United States fleet in the Indian Ocean or to wherever the transmitter can contact it are in terms of transmission. I repeat that it is not an originating station. It is only a monitoring and repeating station. So this is not where the concept of effective co-ordination and consultation comes to pass. Of course the practical, realistic and effective mode of monitoring and control is certainly not a matter of intervention in the operations of the stations. The proper focus of our effort is the United States global policy. If we know what that is about, we will have an accurate understanding of the type of message being transmitted through North West Cape.

Mr Lionel Bowen:

– Have you approved this alteration?

Mr KILLEN:

– I repeat to the honourable gentleman and to the House that no alteration has been approved by the Australian Government regarding this station. I trust that that language is absolutely clear. What is in prospect- I repeat, it remains in prospect because no approval has been given by the Australian Government- is to take out the existing satellite terminal, which is technically described as a TSC54 unit system, and replace it with an MSC6 1 system. I am not in a position to give a description of the difference between the two systems other than to say in general terms that the capability of the proposed new system is better than the existing system. That is simply the position.

Mr Lionel Bowen:

– Would not they have consulted you before this on the matter?

Mr KILLEN:

– I repeat, I would have some views to offer as to communications in the broad, but at a technical level there were consultations relating to this matter as far back as 1972. There were consultations going on when the honourable gentleman’s Government was in office. I offer this view- I do not offer it in any ungenerous sense: There comes a time when technical considerations must be characterised as having important political significance, and that should be communicated through policy channels as distinct from straight technical channels. I offer no sharper rebuke than that. Some of my honourable friends may ask: Why is it that you sought to offer a gentle impeachment of the United States? I believe that once the technical considerations and consultations moved from the privacy of what I might call that area and became public- in other words, once it was placed before a congressional committee- at that stage it was proper and courteous for the Australian Government which was affected to have been informed.

page 2390

QUESTION

INFLATION

Mr CARLTON:
MACKELLAR, NEW SOUTH WALES

– Has the Prime Minister seen a report of the meeting held by the Sydney Chamber of Commerce on 22 May 1978 at which it was claimed by a guest speaker that any government can bring down inflation quickly and by almost any amount it cares to name? Does the Government agree with this view? Also, does the Prime Minister believe that it is time for the fight against inflation to be relaxed?

Mr MALCOLM FRASER:
Prime Minister · WANNON, VICTORIA · LP

– I have seen reports of that meeting, and I have seen reports that indicated that in the view of some people it was an easy matter to bring down inflation by any amount. I think the actual statement was: Any government can bring down inflation quickly and by almost any amount it cares to name’. Whilst I agree that governments can bring down inflation I say that the policies needed to do that are sometimes difficult and it is necessary to stick with them with perseverance. There needs to be an acceptance of that in the broad cross-section of the Australian community.

This Government has had considerable success over the last two and a quarter years with its anti-inflationary policies, but it would be a very great pity if the thrust of government policies now were to be altered at the very time when the clear benefits of getting down inflation are starting to be seen and recognised. If we want a resurgence in investment confidence in Australia from overseas we will take pride in getting the inflation rate down below that of our major trading partners and below the Organisation for Economic Co-operation and Development average, and we will stick with that path. That quotation, which I understand came from the Leader of the Opposition -

Honourable members interjecting-

Mr MALCOLM FRASER:

-So I understand, Mr Speaker. I think it is fascinating that the person who said this was once Treasurer in a former government and brought down a Budget. He cared to name 10 per cent as his inflation objective. When he left office the inflation rate was running at 17 per cent. We can assume only that that Budget statement was entirely and utterly false if the statement he makes now that any government can bring down inflation quickly and by almost any amount it cares to name is true. He cannot have it both ways. What he said in that Budget Speech is false or what he said the other day is false. It was perfectly plain that the policies of that Budget were not going to bring down the rate of inflation and it is perfectly plain that the policies that the honourable member would now pursue would lead to a resurgence of inflation in this country. If the Leader of the Opposition really believes the nonsensical claim that reducing the rate of inflation is easy, one can only conclude that he never intended that his Budget would in fact reduce the rate of inflation. In the same speech the Leader of the Opposition called for an easing of the anti-inflationary thrust -

Mr Hayden:

– A point of order-

Mr MALCOLM FRASER:

– . . . at the same time that he was saying that the inflation rate was artificially and temporarily low, and now he is to come in on another phoney point of order.

Mr Hayden:

– Oh, come on!

Mr SPEAKER:

-Order! The right honourable gentleman will resume his seat.

Mr Hayden:

- Mr Speaker, it has been the practice of previous Speakers in the Parliament and, I seem to recollect, of yourself in the past, though it seems to have ceased suddenly, to require Ministers or honourable members referring to newspaper sources at Question Time to vouchsafe their accuracy. The Prime Minister did not and could not do that. I have a copy of my speech. I am happy to have it incorporated in Hansard. I propose that that be done.

Mr SPEAKER:

-The honourable member is not referring to a ruling relating to the answering of a question, but to a ruling relating to the asking of a question. The questioner would be required to authenticate a statement from which he quotes, if called upon to do so. The honourable member has raised that point now. I call upon the questioner to authenticate the statement. Is he able to do so?

Mr Carlton:

– I have a copy of the speech made by the Leader of the Opposition at the meeting of the Sydney Chamber of Commerce on 22 May 1 978. 1 quote from that, at page 4:

Any Government can bring down inflation quickly and by almost any amount it cares to name.

Mr Hayden:

– I think that the honourable member stops too early. The speech continued:

All that has to be decided is the social and economic cost. That is the crunch decision. In the late 1920s we even witnessed a reversal back into deflation. Currency actually appreciated.

It is highly relevant to look at those other points that are together in the section. It reads:

The price, of course, was the collapse of the world’s economics, and the Great Depression of the 1930s.

Mr SPEAKER:

-Order! The Leader of the Opposition will resume his seat. He knows very well that there is opportunity for him to make a personal explanation if he believes he has been misrepresented.

Mr MALCOLM FRASER:

– I am grateful to the Leader of the Opposition for confirming the statement he made, namely:

Any Government can bring down inflation quickly and by almost any amount it cares to name.

He has confirmed that; he has underlined it.

Opposition members interjecting-

Mr MALCOLM FRASER:

-The honourable gentleman will need more than noise from behind him to protect him as time goes on. The Leader of the Opposition said:

Any Government can bring down inflation quickly and by almost any amount it cares to name.

In the Budget that he introduced he indicated an objective of 10 per cent in the rate of inflation. Since the rate of inflation was running at 17 per cent when he left office it is perfectly plain that he never intended his Budget to bring down the rate of inflation. Therefore, either the statement that he made in that recent speech or the statement in the Budget Speech is false, and knowingly false. They cannot both be true. It is odd that the Leader of the Opposition also expressed concern about, and has chosen to defend, the claim of the metal trades unions for a $24 a week wage increase and a large range of other benefits. In the same speech he purported to be concerned about the high cost structure of Australian industry. His contradictions, his inconsistencies in economic matters are just as great as the inconsistencies of his own Party.

Mr Hayden:

– Why do we not have a public debate?

Mr MALCOLM FRASER:

-The honourable gentleman wants a public debate. He has had many opportunities to have a public debate on these matters in this Parliament.

Honourable members interjecting;

Mr SPEAKER:

-Order! The Prime Minister will resume his seat. The outburst of noise is unnecessary. It does nothing for the dignity of the Parliament. I ask the honourable gentleman to remain silent.

Mr Hayden:

- Mr Speaker- I draw your attention–

Mr MALCOLM FRASER:

-Mr Speaker, is the honourable gentleman raising a point of order or is this another unreasonable interruption?

Mr Hayden:

– Yes. It is a point of order.

Mr SPEAKER:

-I will hear the Leader of the Opposition speak on a point of order.

Mr Hayden:

- Mr Speaker, the Prime Minister has seriously misled the House. On every occasion when a debate on economic matters has arisen, he has left the House.

Mr SPEAKER:

-Order! That is not a point of order.

Mr Hayden:

– He has been too cowardly to debate.

Mr SPEAKER:

-Order! The honourable member will resume his seat. I call the Prime Minister.

Mr MALCOLM FRASER:

– In the last few minutes we have heard in the noise that has come from Opposition members the logic and the wisdom of the Australian Labor Party. It is the only logic and the only wisdom of which they are capable. It is noise which is designed to drown out reasoned and proper argument in this Parliament. The Leader of the Opposition has told us nothing of the details of his economic policies. I suggest that the reason for that is his last foray into alternative policy making during the last Federal election when, as we all know, he sold to the then Leader of the Opposition the suggestion that the proposed tax cuts for tens of thousands of Australian working men and women should be taken away from them and the money given to large corporations. Let him stick with that policy from now until doomsday because it will be the doomsday of the Labor Party.

page 2392

QUESTION

INVESTIGATION INTO OPERATION OF FUNERAL COMPANIES

Mr HAYDEN:

-I direct a question to the Prime Minister in which I refer to his often stated views on ministerial propriety and his action in seeking either the resignation or suspension of three successive members of his Ministry for alleged contraventions of legal or ethical conduct. In view of the inquiry just initiated by the Attorney-General of New South Wales into the operations of the Allan Walsh funeral companies from which a sum of some $300,000 allegedly has been misappropriated, could the Prime Minister indicate whether the honourable member for New England is to be suspended pending the conclusion of that inquiry? If not, could he indicate to this House what are the criteria he applies for resignations and suspensions of members of his Ministry whose conduct becomes the subject of public inquiry? In view of his expressed concern about the question of the pecuniary interests of members of Parliament, will the Prime Minister ensure that, in respect of any action he takes relating to the Minister for Primary Industry, he does not allow the Minister to hide behind the corporate veil of companies of which he is a director?

Mr MALCOLM FRASER:
LP

-The Minister for Primary Industry has advised me that when he became executor of his father’s estate, upon examining those matters he immediately commissioned inquiries into the affairs of a number of family companies in which three family companies were involved. That examination is proceeding. It is not yet completed. The Corporate Affairs Commission in New South Wales was advised and tax officers were advised that the inquiries were being initiated by the Minister himself. In addition, I am advised that the three families concerned in this matter are content with the way in which the investigations into these matters are proceeding. No other people are involved. Against that background, I do not believe that any action is required at this point. At some stage there will be an inquiry in the New South Wales Parliament as a result of an investigation that has been launched by the New South Wales Government under Mr Wran. Depending upon the nature of that inquiry, it will be examined fully and properly at that time.

page 2392

QUESTION

TAXATION OF SUPERANNUATION AND LONG SERVICE ENTITLEMENTS

Mr SHACK:
TANGNEY, WESTERN AUSTRALIA

-I direct a question to the Treasurer and I refer to recent reports that the Federal Government is planning to increase tax paid on superannuation and long service entitlements after retirement from 5 per cent to 25 per cent. Can the Treasurer say whether such reports are true or false?

Mr HOWARD:
Treasurer · BENNELONG, NEW SOUTH WALES · LP

-I inform the honourable member for Tangney and the House that there is no such proposal currently before the Government and I am unaware of the reasons for such a rumour gathering force in the community.

page 2392

QUESTION

TELEVISION LICENCES

Mr INNES:
MELBOURNE, VICTORIA

– I direct a question to the Minister for Post and Telecommunications which refers to the issue of television viewers’ licences. I refer the Minister to two answers given on the subject, one by himself to my colleague the honourable member for Fraser, and another answer given in another place by Senator Carrick to Senator Melzer. The last answer was given as late as 2 May 1978 when Senator Carrick, on behalf of the Minister, categorically denied that television licences were being prepared in order to be introduced. I ask the Minister to verify or to deny the answer given to Senator Melzer. If he cannot do so and if it is a fact that television licences are being printed and are about to be introduced, will he inform the House of the cost of a licence and why the Government continues to mislead the people of Australia by going back on its undertakings?

Mr STALEY:
Minister for Post and Telecommunications · CHISHOLM, VICTORIA · LP

– I can only reiterate what has been said on previous occasions- indeed every few weeks- when I have been asked about this matter by the press or by members of parliament. I know of no proposal for the introduction of television viewers’ licences.

page 2392

QUESTION

KANGAROO ISLAND AIRPORT

Mr PORTER:
BARKER, SOUTH AUSTRALIA

-Is the Minister for Transport aware that during wet weather the Kangaroo Island airport is liable to be closed, prohibiting the use of the air ambulance and thereby causing serious problems for the sick or injured on that Island? Has the Minister recently stated that the sealing of that government owned airstrip has not a high priority in competition with other government owned airports? Can he tell the House which national airport works currently approved for funding are required to avoid such a serious risk to people ‘s lives as exists on Kangaroo Island?

Mr NIXON:
Minister for Transport · GIPPSLAND, VICTORIA · LP

– I am well aware of the honourable member’s concern in relation to this matter. He has made representations to me continuously since he has been a member of this Parliament, and hopefully his efforts will finally be rewarded. If the information he has given me is correct, I am concerned that at some times of the year air ambulances are unable to attend to patients on Kangaroo Island. I will have a look at the information which he has given me. Insofar as Commonwealth airports are concerned, Kangaroo Island has to compete with such airports as Brisbane, Sydney, Tullamarine and Perth, just to name a handful of them. The honourable member will realise that I have had representations from people like the honourable member for Lilley, the honourable member for Bowman and the honourable member for Brisbane about the Brisbane airport. I have had representations about the Perth airport from all honourable members from Western Australia. The Sydney airport problem continues to bug me and every other member of this Parliament, as do the problems that I have in relation to making a decision on secondary airports. Having said that, I can only say to the honourable member that in considering the next Budget allocation I will seriously rank Kangaroo Island against the needs of Brisbane, Sydney, Tullamarine and others.

page 2393

QUESTION

PETROCHEMICAL PROJECT: REDCLIFFS

Mr WALLIS:
GREY, SOUTH AUSTRALIA

– I direct my question to the Prime Minister. I refer to the possibility of the establishment of a petrochemical project at Redcliffs in South Australia by Dow Chemical (Australia) Ltd and the approach made by the South Australian Government to the Federal Government for assistance in providing the necessary infrastructure should the company involved decide to go ahead with the project. Can the Prime Minister give the House any information he may have on his Government’s attitude to the approach by the South Australian Government for assistance in providing the necessary infrastructure, bearing in mind that such a project would save the nation over $200m a year in our balance of payments?

Mr MALCOLM FRASER:
LP

-During the course of last year it was agreed at Premiers Conferences that officials of the States and the Commonwealth should meet to try to work out infrastructure guidelines for State instrumentalities and semi-government authorities to borrow funds in Australia or overseas to meet the infrastructure requirements of developmental works. The officials examined those proposals over a considerable period and came to agreement on the broad basis of the guidelines with the exception of the voting arrangements for the approval of projects because they were to be approved through the Loan Council. The Commonwealth had adopted the view that, because of the responsibilities that it has for the control over the money supply and the overriding responsibility it has also for the reputation overseas of Australia’s borrowing name as a nation, the voting procedure in the Loan Council should be a simple majority, with the Commonwealth being a part of that simple majority. Originally the States, with the exception of South Australia, resisted that proposal, but now a majority of States has accepted that voting proposal for a trial period of 3 years. The Commonwealth has willingly agreed that the voting arrangements can be reviewed at the end of that time.

The Premier of South Australia, in responding to my suggestion about the voting arrangements and indicating his agreement to them, said that his State would be putting forward an application for funds for infrastructure in relation to the Redcliffs project. That matter, as I understand it, is now being documented. The Treasurer, as Chairman of the Loan Council, may have later information than I have on how far that documentation has gone. I believe that we would need to be convinced also that those who will run the private enterprise part of the project have firm proposals and firm intentions to proceed. I think the honourable gentleman would well understand the need for that. This is one of the projects that I hope the Loan Council will be able to examine at the forthcoming meeting in June.

Over the last three or four months I have urged the States to accept the Commonwealth’s recommendations on voting arrangements and to put forward to the Loan Council projects which they wish to be financed under the broad infrastructure guidelines so that they can be properly examined and a decision made upon them. Mr Dunstan, in terms of his initial application, was the first cab off the rank in relation to that proposition. I hope that other States take the Commonwealth’s suggestion seriously so that there can be a proper discussion at the next Premiers Conference of that project and of other projects in the national interest.

page 2393

QUESTION

DOMICILIARY NURSING CARE BENEFITS

Mr MILLAR:
WIDE BAY, QUEENSLAND

-Can the Minister for Health inform the House whether there is any prospect of assistance to those people required to give full time attention to chronically ill or infirm parents who might not at present qualify for domiciliary nursing care benefits?

Mr HUNT:
Minister for Health · GWYDIR, NEW SOUTH WALES · NCP/NP

– The honourable member for Wide Bay might recall that the Prime Minister announced in his election speech last year that there would be an extension of the provisions of the domiciliary nursing care benefit to people below 65 years of age- indeed, to those 16 years and over- who were properly approved by a medical practitioner to be eligible for the equivalent of nursing attention. The Government is anxious to try to assist those people who wish to care for members of their families or relatives or friends in their own home environment. Presently the benefit applies to patients who are 65 years and over.

Considerable relaxation has taken place recently in regard to the number of visits nursing sisters should make provided that the medical practitioner, the sisters concerned and the Department of Health are satisfied that the person caring for the ill person is capable of providing adequate care. I anticipate that in the course of the Budget deliberations the Government will be considering the question of reducing the age limit to 16 years and looking at the level of benefit that has been applying on a daily basis since 1972.

page 2394

QUESTION

ECONOMIC POLICY

Mr WILLIS:
GELLIBRAND, VICTORIA

– My question, which is addressed to the Prime Minister, concerns reports that he clashed with Vice-President Mondale on the appropriate approach to economic policy when the Vice-President visited here two weeks ago. Is it a fact that the Prime Minister told the Vice-President that American economic policies were wrong and that President Carter should adopt his policy of attacking inflation first? Is it also a fact that Vice-President Mondale rejected his views as representing poor economic and social policies and stated that nations did not have to choose between inflation and unemployment? Will the Prime Minister also inform the House whether, prior to lecturing the VicePresident, he was aware that whilst the number of employed Australians declined by 50,000 over the past year, the total number of employed Americans increased by 3.5 million in the same period?

Mr MALCOLM FRASER:
LP

– I have no intention of commenting on the detailed discussions that were held with the Vice-President.

Mr Bryant:

– It must have been a painful experience.

Mr SPEAKER:

-Order! The level of interjection and noise from my left is unbecoming to the Parliament. I ask honourable members to listen to the answer in silence.

Mr MALCOLM FRASER:

– If I may be forgiven a comment, I can well understand members of the Opposition finding it hard to contain their wisdom. The discussions with the Vice-President were at all times cordial and involved a frank exchange of views. But I would not regard it as normal practice, and I do not intend it to be my practice, to indicate the substance of conversations which, so far as I am concerned, were undertaken privately between the Vice-President and myself and other Ministers. Many people expressed concern about inflation. It ought to be noted that the rate of inflation and the wholesale price index in the United States in the month of April, I think, or it might have been March, were running at 1.3 per cent, or an annual rate of 15 per cent, if one wanted to make that sort of a calculation. Quite plainly, because of the importance of the United States economy to all the trading nations of the world, there are many countries that want to see a strong and viable United States, a strong and stable United States dollar, and a United States in which there is no resurgence of inflation. If there is such a resurgence in the United States it would tend to flow through into other countries because of the importance to them of the United States economy.

We know quite well that in recent days President Carter has expressed a renewed determination to prevent a resurgence of inflation in the United States, and I applaud the President’s statements very fully indeed. A number of actions have been taken to indicate not only that intention but also a backing and strengthening of the United States dollar. We also know quite well that the adoption of an energy policy is one of the matters on which the President places a great deal of importance, and we would certainly be supporting him on that. The fall in the value of the United States dollar quite plainly has been a cause of concern to the trading world in recent times, and I am sure that the United States would wish to see that ended, as we wish to see it ended. Stability in currency values is one of the prerequisites for a strong and healthy world economy and for the growth of international trade.

page 2394

QUESTION

COAL EXPORTS

Mr GILLARD:
MACQUARIE, NEW SOUTH WALES

– Is the Minister for Trade and Resources satisfied with Australia’s present capacity to meet its current and potential coal export orders? If not, where do the deficiencies exist?

Mr ANTHONY:
NCP/NP

-One of the brightest spots on the economic horizon is the prospect of selling more coal overseas, particularly steaming coal. Numerous inquiries on this matter have come from other countries. Last year something like seven delegations from various countries inspected the facilities in Australia and the capacity of Australia to sell steaming coal. In New South Wales there is enormous potential on the South Coast and in the western district and the Hunter Valley for expanding coal facilities. In Queensland there are also numerous opportunities. I think that the great concern of the coal mining industry lies in New South Wales, with the inadequate port facilities available. I issued a statement on this subject yesterday because I am concerned, as the industry is concerned, about the inadequate facilities surrounding Port Kembla and the decision not to proceed with the coal loader at Botany Bay. If that coal loader facility at Botany Bay had proceeded as was originally intended it would have come into operation possibly this year and would have provided a golden opportunity for expanding coal mining operations in the southern and western regions of New South Wales. I have to say that it did not go ahead because of a political decision- straight out political expediency- by the Wran Government. Protests were held about the environmental factors in that area.

If that Government makes those decisions, it must accept the responsibility. At the moment there is utter and sheer confusion about New South Wales being a reliable and dependable exporter of steaming coal to other countries. At the moment importers are doubting whether New South Wales will have the capacity to export. Certainly there is already a limit to the size of the ships that can go into its ports. If coal handling facilities had been constructed at Botany Bay the world’s largest ore carriers could have gone into that port. Apparently the New South Wales Government had no concern for the environmental factors in expanding the capacity at Balmain which is in the very heart of the city. I think the Wran Government in New South Wales must accept its responsibility, if it wants to see this industry which has a great deal of potential go ahead, by reconsidering Botany Bay and building facilities there so that this industrythere is no other industry in New South Wales with as much potential as the coal industry- can grasp the export opportunities for which Mr Wran was looking in the United States and which he said that he found.

page 2395

INCORPORATION OF DOCUMENT IN HANSARD

Mr HAYDEN:

-Mr Speaker, I presumed earlier that you agreed to having my address to the Sydney Chamber of Commerce on 23 May incorporated in Hansard.

Mr SPEAKER:

-Did the honourable gentleman request that the address be incorporated?

Mr HAYDEN:

– I did request that earlier, Mr Speaker, and I understood you to agree to it. I want to confirm that.

Mr SPEAKER:

-I do not have the capacity to agree to it. It is a matter for the House.

Mr HAYDEN:

– I understand that the House has agreed to it.

Mr SPEAKER:

-The honourable Leader of the Opposition seeks leave to incorporate the speech in Hansard. Is leave granted?

Leave not granted.

page 2395

TRADE AGREEMENT BETWEEN AUSTRALIA AND BRAZIL

Mr ANTHONY:
Minister for Trade and Resources · Richmond · NCP/NP

– For the information of honourable members I present a copy of the trade agreement between the Governments of Brazil and Australia, signed on 23 February 1978.

page 2395

JOINT COAL BOARD

Mr ANTHONY:
Minister for Trade and Resources · Richmond · NCP/NP

– Pursuant to section 20 of the Coal Industry Act 1946 I present the annual report of the Joint Coal Board for the year ended 30 June 1977.

page 2395

OVERSEAS CARGO SHIPPING LEGISLATION

Mr NIXON:
Minister for Transport · Gippsland · LP

– For the information of honourable members I present the report on overseas cargo shipping legislation which is tabled in substitution for the photostat copy presented on 2 November 1977. This document is the final report and contains some editorial corrections to that report which I presented previously.

page 2395

INTERNATIONAL MONETARY AGREEMENTS ACT

Mr HOWARD (BennelongTreasurer)Pursuant to section 10 of the International Monetary Agreements Act 1947 I present the report on the operations of the International Monetary Fund and the International Bank for Reconstruction and Development insofar as they relate to Australia for the financial year 1976-77.

page 2395

AUSTRALIA-JAPAN FOUNDATION

Mr PEACOCK:
Minister for Foreign Affairs · Kooyong · LP

– Pursuant to section 25 of the Australia- Japan Foundation Act 1976 I present the final annual report of the Australia- Japan Foundation for 1977.

page 2396

ABORIGINAL LOANS COMMISSION

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

– Pursuant to section 36 of the Aboriginal Loans Commission Act 1976 1 present the report of the Aboriginal Loans Commission for the year ended 30 June 1977.

page 2396

IMPACT OF MINING ROYALTIES ON ABORIGINAL COMMUNITIES IN THE NORTHERN TERRITORY

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

– For the information of honourable members I present a report by Mr Shann Turnbull made on behalf of the Department of Aboriginal Affairs on the impact of mining royalties on Aboriginal communities in the Northern Territory.

Motion (by Mr Fife) agreed to:

That the House take note of the paper.

Debate (on motion by Mr Keating) adjourned.

page 2396

MEDICAL RESEARCH ENDOWMENT ACT

Mr HUNT:
Minister for Health · Gwydir · NCP/NP

Pursuant to section 9 of the Medical Research Endowment Act 1937 I present a report on work done under that Act during 1 976.

page 2396

PIPELINE AUTHORITY

Mr NEWMAN:
Minister for National Development · Bass · LP

– Pursuant to section 45 of the Pipeline Authority Act 1973 I present the annual report of the Pipeline Authority for the year ended 30 June 1977.

page 2396

ALBURY-WODONGA DEVELOPMENT CORPORATION

Mr NEWMAN:
Minister for National Development · Bass · LP

– Pursuant to section 32 of the Albury-Wodonga Development Act 1973 I present the annual report of the AlburyWodonga Development Corporation for the year ended 30 June 1976. The report has been delayed because of the requirement under section 32 to obtain the approval of the Treasurer to the form of the financial statements. This approval was given on 9 November 1977. The Auditor-General’s certificate was issued on 7 March 1978.

page 2396

STATES GRANTS (TECHNICAL AND FURTHER EDUCATION) ACT

Mr STALEY:
Minister for Post and Telecommunications · Chisholm · LP

– Pursuant to section 30 of the States Grants (Technical and Further Education) Act 1974 I present a statement of payments to the States authorised under that Act for the financial year 1 976-77.

page 2396

TERTIARY EDUCATION COMMISSION

Mr STALEY:
Minister for Post and Telecommunications · Chisholm · LP

– For the information of honourable members I present the Tertiary Education Commission draft report on study leave together with the text of a statement by the Minister for Education relating to the report.

page 2396

METAL WORKING MACHINE TOOLS

Industries Assistance Commission Report

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– I present the report of the Industries Assistance Commission on the following subject:

Metal working machine tools.

page 2396

PERSONAL EXPLANATION

Mr HAYDEN:
Leader of the Opposition · Oxley

I wish to make a personal explanation.

Mr SPEAKER:

-Does the honourable gentleman claim to have been misrepresented?

Mr HAYDEN:
OXLEY, QUEENSLAND · ALP

– Yes.

Mr SPEAKER:

-He may proceed.

Mr HAYDEN:

– In the course of Question Time an honourable member took the opportunity to quote out of context a statement made by me in an address which I made publicly in Sydney on Monday. He quoted:

Any Government can bring down inflation quickly and by almost any amount it cares to name.

That statement must be seen in the context in which it was delivered. It was pointed out that what has to be decided is the social and economic cost of decisions to bring down inflation. For instance, in the 1920s we even witnessed a reversal back into deflation and currency actually appreciated. The price, of course, was the collapse of the world’s economies and the Great Depression of the 1 930s. I pointed out that what has to be acknowledged is that a national government is always faced with conflicting objectives and conflicting pressures, as you would well recall, Mr Speaker, from your days as Treasurer. I said:

Its task is to achieve a balance in its policies . . .

I pointed out that there is no balance; that the present approach must be corrected; that the Government was too excessive in the way in which it was handling the economy; and that it was forcing tens of thousands of people needlessly into unemployment.

In responding, the Prime Minister (Mr Malcolm Fraser) made some observations about comments I had made on wages. Perhaps I should point out that within the context of continuing concern about inflation, I said this:

There is another point about inflation I would like to raise. That is the much quoted concept used by this Government of real wage overhang’.

I pointed out that if the Government pursued its objective as submitted to the Conciliation and Arbitration Commission in relation to so-called real wage overhang it would be reducing wages by, on average, 10 per cent, which is nearly $20 a week and that that would have disastrous consequences on the level of economic activity. I pointed out also that in the past two years there has been effectively a reduction in average incomes for the average family and what they can spend in real terms of about $12 a week. I make no apologies for making that statement. I pointed out that the unions by and large had adhered to the indexation system in spite of the fact that -

Mr SPEAKER:

-Order! The honourable gentleman is going beyond the point of a personal explanation.

Mr HAYDEN:

– I can clear this up in about three more sentences.

In spite of the fact that the Prime Minister had given a firm undertaking that he would preserve that concept as it applied at the time of the 1975 election, he then sought to destroy it soon after entering office. I also signalled that because of the provocative way in which the Prime Minister and the Government were handling this matter, were squeezing real wages, there is likely to be industrial reaction. The final point the Prime Minister raised was that I have not been prepared to debate economic matters with him. We have been very happy to do so. We have never been able to get him into the House to discuss these matters although we have moved many motions in the Parliament on them. The only occasions on which we were able to make him accountable were occasions when his own credibility and integrity came into question. That has occurred quite frequently in this Parliament.

page 2397

HEALTH CARE COSTS CONTROL PROGRAM

Ministerial Statement

Mr HUNT:
Minister for Health · Gwydir · NCP/NP

– by leave- Over recent years, the rapidly rising costs of health care have been a cause of deep concern in a number of Western nations. Australia is now no exception. In Australia, the great health cost explosion began during the term of the Labor Government. It was a cost explosion directly associated with a large transfer of health expenditure from the private to the government sector. The figures demonstrate this situation very clearly: In 1971-72 the Commonwealth Government met 30.2 per cent of all health expenditure and the private sector 43.1 per cent. Only four years later in 1975-76- the last year of the Labor Government- the Commonwealth was meeting 52.0 per cent and the private sector 22.6 per cent of health spending. In the five-year period 1971-72 to 1976-77 health costs exploded from $2,232m to $6,254m. The costs of health cafe per head in Australia have risen from $104 in 1966-67 to $447 in 1976-77- that is, by more than four times in 10 years.

Despite this very rapidly rising financial burden on the community, there is no evidence available to show a decline in illness. For this financial year, 1977-78, over 10 per cent of all Commonwealth Government spending is being directed to health. As the Organisation for Economic Co-operation and Development report of July 1977 commented:

It would seem that Governments are being increasingly faced with the need to establish an ‘economic’ limit to the growth of public health expenditure.

That applies with just as great a force to Australia as it does to other similar nations.

When the Fraser Government was elected to office in December 1975, it was abundantly clear that one of the challenges of management of the economy in difficult conditions was to arrest the rapidly spiralling costs of health care. While Medibank had achieved universal insurance, it had done so at high cost to the community. The original Medibank was completely open-ended and it encouraged both over-use and abuse. It was just as clear to the Government that unless action was taken to arrest the rate of health costs inflation, it would crowd out opportunities for income tax reductions and government spending on other essential programs to give relief to the needy sections of the community.

This Government therefore established the Medibank Review Committee in January 1976 to examine the health insurance scheme. As a result of that review, significant modifications were made to Medibank from 1 October 1976. Those changes have already resulted in a decline in the rate of acceleration in health costs. Last financial year, the most recent for which full figures are available, the rate of growth was held down to 19.7 per cent.

Expressed as a percentage of the gross domestic product, health spending in each of those years totalled: 1973-74, 5.9 per cent; 1974-75, 6.8 per cent; 1975-76, 7.4 per cent; and 1976-77, 7.7 per cent. It is even more important to note that the percentage increases over the preceding year in the proportion of the gross domestic product taken by health costs was: 1973-74, minus 0.8 per cent; 1974-75, plus 15.4 per cent; 1975-76, plus 8. 1 per cent; and 1 976-77, plus 3.9 per cent.

The same picture, of continuing increases followed by a slowing up after the October 1976 changes, is revealed by the figures for medical services per person covered by health insurance and pensioner medical service arrangements during the same period: 1973-74, 4.7 medical services per person, a fall of 4. 1 per cent over the previous year; 1974-75, 5.3 medical services per person, a rise of 13.6 per cent; 1 975-76, 5.9 medical services per person, a rise of 11.0 per cent; and 1976-77, 5.6 medical services per person, a fall of 5.6 per cent. This fall of 5.6 per cent in medical services last financial year was both substantial and welcome. But the Government is not satisfied that this drop in the explosion of health care costs has been sufficient. The rate of growth of health costs is well above the general rate of inflation. It is still far from acceptable. Since the October 1976 changes, the Government has closely monitored the health insurance system and health costs generally within the information available. Some of the results have been encouraging.

In the field of pathology, for example, alarming increases occurred with the original Medibank. The Government established a pathology working party, under the chairmanship of Dr Sidney Sax, in association with the colleges, the medical profession and with State representation, and the Government has taken action on its recommendations. The cost of pathology services doubled from the six month period ended June 1975 to the six month period ended June 1976. However, since the changes in pathology arrangements, preliminary information indicates an appreciable decline in the quarterly cost of pathology. For instance, it is estimated that the gross benefits payout by Medibank for pathology decreased by 29 per cent from the June 1977 quarter to the March 1978 quarter. High-cost medical and diagnostic technology is another area now under investigation by a further committee under the chairmanship of Dr Sidney Sax and a report and recommendations are expected shortly.

The struggle against rising costs has been successful in other areas. Increases in medical fees over the last two years have moderated to levels below the inflation rate. This is a singular achievement compared to the increases while the Australian Labor Party was in government. With the full co-operation of the Australian Medical Association, the Government has also established medical services committees of inquiry in each State, to review cases where excessive services have been rendered by medical practitioners. As well, the Government has stepped up its campaign to identify cases of fraud against Medibank. Penalties for fraud have been increased from a $500 fine or six months imprisonment to a $10,000 fine or imprisonment for five years and the offences have been made indictable. Fifty-two cases are now under investigation, including 32 doctors; 24 are now under prosecution, including 1 1 doctors; and 69 have been prosecuted, including 8 doctors. The Government has also asked the medical profession to implement professional standards review.

In addition, new hospital agreements have been made with State governments, providing for sound budgeting practice aimed at reducing the great increase in hospital costs. Further discussions with the States are under way to achieve accreditation of pathology and of hospitals in the interests of cost restraint. Despite this progress, it was apparent that further action would be necessary to achieve improved health cost levels. Last year, therefore, I asked the Hospitals and Health Services Commission to undertake a thorough review of the health care cost question. The Commission produced a paper which was tabled in the House on 15 March 1978. This paper laid the foundation for debate and discussion within the Parliament and throughout the country.

The Government has considered a large number of options available to it to generate the necessary sense of community responsibility in both the provision and the usage of health services. There are no easy answers available. There is no simple panacea for a most complex set of problems. However, I must relate the basic objectives of the Government’s health policy, and they are as follows: To promote and protect the health of all people; to ensure that all people, regardless of their means, have access to high quality health care; to provide special protection to the pensioners and low income groups, with those on higher incomes insuring themselves to help pay their health care expenses; to promote preventive health care; to obtain the best value for the taxpayers’ dollars spent on health care; and to minimise abuse and overuse of services.

It is true to say that Australia enjoys one of the best and most accessible health services and health care delivery systems in the world. But there is room for improvement. Special disabilities still affect people in remote areas, Aboriginal communities, ethnic communities, and in developing urban areas. Policies have already been announced to assist in the payment of at least part of travel and accommodation costs of patients forced to travel beyond 200 kilometres in order to obtain specialist medical attention. Special programs are also being developed to improve access to medical services acceptable to Aboriginal people. The national trachoma program is further evidence of the Government’s determination to improve the health of Aboriginal communities. Proposed interpreter services, located in health facilities throughout Australia, demonstrate the Government’s awareness of the special problems of the ethnic communities in health care.

As for health costs containment, restraint for its own sake does not dominate our thinking, but there is no escaping the fact that unless we control rapidly rising costs, they will crowd out opportunities for essential spending in other areas of government responsibility. People pay for health costs by one means or another, whether it be by income taxation, levies and charges, health insurance premiums, direct patient payments, or a combination of these means. We cannot escape the bill. There is no such thing as free health care. Those who receive care for no direct cost are being paid for by other people by one means or another. I emphasise this because, while universal health insurance cover provides security and access to health services, it does tend to weaken the perception of both the providers and the users of the real costs of those services.

Government subsidy to reduce health costs can blind us all to the costs of those services. Unless the universal health insurance system has inbuilt incentives designed to create cost consciousness, commonsense suggests- and experience shows- that unnecessary costs will be generated. The Government’s first responsibility is to assist those who cannot help themselves. It should not be directed to assisting those who have sufficient resources to help themselves. Large-scale acrosstheboard Government subsidy is wasteful of resources and reduces the Government’s capacity to assist the needy sections of the community.

The changes I am announcing under the Government’s health cost control program are, therefore, designed to: Encourage responsible use of one of the best health services in the world; ensure that overuse and abuse are reduced to a minimum; obtain the best value for taxpayers’ dollars spent on health care; and promote competition and innovation in health insurance. I will now outline the changes the Government has decided will be made forthwith in the health insurance and associated areas. As I have indicated, the changes which were made in health insurance arrangements on 1 October 1976 have achieved some slowing-down in the very high rate of growth in usage of health services and in increases in health care costs. The Government has carefully reviewed information available to it, both from the process of monitoring the impact of those changes on health costs and usage and as a result of the general review of health insurance which I requested in October of last year. As a result, the Government has now approved substantial changes affecting medical insurance. However, it has also decided that in view of the important contribution of hospital costs to the total problems, actions will be taken immediately to reduce unnecessary hospital outlays. The Government will continue to monitor hospital costs.

To enable this monitoring to proceed in a detailed manner, the Government has further decided that more comprehensive information concerning some aspects of the operation and costs of the hospital and medical insurance system, where better information is necessary, should be made available to it. Accordingly the Government has decided to seek the authority to obtain and analyse information from and about the health insurance system in greater depth. As well, a number of specific pilot surveys covering the usage and cost of health services in individual areas will be undertaken. This action, together with a basic review now under way of health data available for policy evaluation, will provide the Government with a more accurate information base which is an important requirement of a continuing review.

Until an improved data base becomes available, the Government believes that it would be premature to proceed further with the consideration of major adjustments to the health insurance system. The Government believes this to be the most responsible approach to the objective of constraining the rising costs of health care to the taxpayer and to the community generally. I turn now to the changes the Government proposes to make at this time.

Medical Benefits

The current medical benefits rates are 85 per cent of schedule fees with a maximum patient contribution of $5 for any one service where the schedule fee is charged. The principle of a patient gap has been in operation for many years. Indeed it has operated since the beginning of a national health scheme. The gap principle remained in force while the Australian Labor Party was in government. Over recent years there has been a rapid growth in the per capita utilisation of medical services. Preliminary information available indicates that since the 1 October 1976 modifications to Medibank there has been some slowing-down in the use of medical services. However, utilisation continues at unacceptably high levels. This results in high rates of private health insurance contributions and in high levels of taxpayer contributions towards Medibank standard medical benefits.

The Government has decided that the rate of medical benefits payable to persons in Medibank standard and to contributors to the basic medical benefits tables of private medical insurance organisations will be reduced. Therefore medical benefits will be paid at the rate of 75 per cent of schedule fees with a maximum patient contribution of $10 for any one service where the schedule fee is charged. These new benefit levels will operate from 1 July. People who wish to obtain additional insurance cover as a result of this decision will be able to obtain it through the supplementary tables of private health insurance organisations.

I propose to enter into negotiations with the Australian Medical Association in order to determine the level of medical benefits payable for schedule services provided to people with pensioner health benefits entitlements where the great majority of doctors accept the general rate of benefits in full settlement for the services rendered. I anticipate that the AMA will agree to accept this principle as it has done for many years and I know that many doctors will be pleased to accept the new rates. The Government has decided that bulk or direct billing arrangements for medical benefits be abolished, except for people with pensioner health benefits entitlements. This should reduce the overprovision of services and fraud. It will involve the patient directly in the payment of medical accounts, even where a ‘pay doctor’ cheque is the only transaction involved.

The average cost of basic private health insurance at present is about $9 a week for family cover. This comprises approximately $5 for medical insurance and $4 for hospital insurance. The actual rates, of course, vary from State to State and from fund to fund. These rates will be affected in two ways by these decisions: The reduction in the percentage level covered by medical benefits and the increase in the patient gap is expected to lead to a reduction in medical insurance contributions. The introduction of optional deductibles- to which I will refer- will lead to reductions in medical and hospital insurance costs for those who choose to insure privately in this manner. This will enable exemption from the Health insurance levy for a substantially lower contribution. The change in medical benefits is expected to lead to a reduction of 46c a week, family rate, in medical insurance contributions, reducing the average rate to $4.54 a week.

In this connection, I would point out that it is a matter for the funds to calculate changed rates of contribution and then to apply to me for approval. This will, of course, take a little time, but applications will be processed as quickly as possible once they are received. In approving changed contribution rates, I will naturally take into account that the reduced benefits are operating from 1 July this year. It is intended that the new medical benefits levels be introduced on 1 July. Bulk billing, except for eligible pensioners and their dependants, will be abolished as soon as the administrative arrangements can be made. Meanwhile a rigorous examination of the scope of the medical benefits schedule is being undertaken. It will include an examination of the levels of individual fees for benefit purposes, having regard to such factors as relative complexities of the services and modern medical practice and technology. As a result of these decisions, it is estimated that the savings to Commonwealth expenditure in a full year would be in the order of $24m

Deductibles

The rising cost of private health insurance has brought forward a significant number of proposals to the Government for further modification of health insurance arrangements. One suggestion is that people should meet a specified amount of their health costs in each year before becoming eligible for benefits. This concept, known as ‘deductibles’ is somewhat akin to arrangements to pay an ‘excess’ in comprehensive motor vehicle insurance. Other suggestions have been that medical services rendered in certain circumstances should not attract benefits- for example, some forms of cosmetic surgery and some terminations of pregnancy. Consequently, the Government has decided that in addition to offering the present standard or basic medical and hospital benefits tables, private health insurance organisations will be permitted to offer optional deductibles in those tables within reasonable limitations to be approved by the Government.

Approved optional deductibles arrangements will exempt contributors from the health insurance levy payment, but the Government does not intend to lay down unnecessarily restrictive guidelines. We will be seeking to allow funds the fullest possible flexibility and competitiveness within the principle of preserving universal cover. In providing this new flexibility the Government is giving both the private funds and the community generally the opportunity to take advantage of a widely held belief that the introduction of ‘excess’ type arrangements in health insurance will provide an incentive to people and providers not to over-use available services.

The Government also feels that this imaginative new concept has the potential to reduce health insurance contributions for those who wish to accept a larger direct share of responsibility for the costs of their health care.

The Government believes that this opportunity will begin a new phase of competition amongst the majority of private health insurance funds throughout Australia. The Government will be monitoring these innovations closely to ensure that the new arrangements are compatible with its stated objectives in health insurance arrangements. I emphasise again that it is the Government’s intention that competition between funds should be as free as possible in this innovative area, consistent with the final overall policy framework. But I wish to make it clear that while the Government has decided in favour of introducing deductibles, no final decision will be taken on either the form of, or the limitations on, deductibles until the whole concept has been discussed in full detail with the health insurance organisations and other interested authorities. Their views and proposals will be taken fully into account and I will be taking the matter back to Government for approval of the final guidelines which will apply.

In view of this, the Government has further decided that there will be no immediate alteration in the health insurance levy arrangements until discussions concerning deductibles have been concluded and the Government is able to assess more precisely their overall impact on health costs and the relativity between premium levels and the levy arrangements. In this context, I caution contributors to health insurance funds to consider carefully before making any hasty decisions to change health insurance arrangementsfor example, from private insurance to Medibank standard- before the final effect of deductibles can be assessed. It should be remembered that private funds may require people transferring from Medibank standard to serve a two-month waiting period during which both private insurance premiums and the Medibank levy would be payable.

Hospital Sector

I now turn to a further aspect of the organisation and operation of the health care system that is causing the Government concern. Hospitals are by far the most costly component of institutional care. Their supply, organisation and operation, need to be reviewed. The total Commonwealth outlay on the hospitals sector represents 57 per cent of all Commonwealth expenditure on health services. In 1976-77 the total gross operating costs for public hospitals in Australia amounted to nearly $2, 100m. The daily gross operating cost per occupied bed was almost $ 120 per day for the financial year ending 30 June 1977. This cost is estimated to be $135 per day this financial year and could approach $150 per day in 1978-79. Operating costs vary widely between the States- from $100 per occupied bed day in Queensland during 1976-77, to $ 1 42 per day in Western Australia.

In reviewing the health care and health insurance system, the Government clearly could not ignore cost increases or cost magnitudes of this order. The Government has, therefore, authorised early negotiations with the States and other appropriate bodies, to develop new arrangements that: make the best use of public and private hospitals without wasteful over-provision or duplication; restrict the beds approved for hospital cost-sharing to no more than is essential for good care; require long-stay patients in recognised hospitals to contribute towards their accommodation and care as they would do in nursing homes; require hospitals to satisfy prescribed standards of accommodation and service as a condition of hospital cost-sharing; classify different types of hospitals with a view to applying varying levels of charges to different groups of hospitals; require the standards for hospital cost-sharing to cover the efficiency of management, methods of assessing the quality of care, estimates of the appropriateness of the technology used and arrangements for sharing expensive resources in a rational manner; and incorporate some out-of-pocket payment, for example, through a system of utilisation review in which out-of-pocket payments would be required for unauthorised stays in hospital.

The changes announced this afternoon have been designed within the framework of the current health insurance arrangements. The community has shown strong support for the concepts of diversity and competition that we introduced in 1976. These concepts will now be very significantly extended by the introduction of deductibles on an optional basis. Insurance funds that offer policies with deductibles should quickly attract those persons who wish to reduce their daily cost of Jiving by paying substantially lower health insurance premiums. The program that I have announced reflects the widespread encouragement that cost control efforts are receiving through our health services. Such efforts must be supported by government so that stability of insurance rates can be achieved and maintained. I present the following paper:

Health Care Costs Control Program- Ministerial Statement, 24 May 1978

Motion (by Mr Fife) proposed:

That the House take note of the paper.

Dr KLUGMAN:
Prospect

-I feel sorry for the Minister for Health (Mr Hunt) in having to come into the House today to make this statement. He knows that it is not the sort of statement in which he believes. He was careful of course to emphasise that repeatedly in his speech.

Mr Hunt:

– I did no such thing.

Dr KLUGMAN:

– He said that he did not believe the propositions and that he did not have any statistical information to support any of his proposals. The Government worked on the changes for more than 2 years but the total saving to the Commonwealth will be less than one per cent of the expenditure on health costs. Commonwealth expenditure on health costs this year will be of the order of $3,000m. Honourable members know that government departments always underestimate the cost of changes. The expected saving will be $24m out of $3,000m. The Minister read a 22-page statement in order to save $24m. The other day the Minister for Defence (Mr Killen) made a much shorter statement in order to pay $40m for two VIP aircraft so that the Prime Minister (Mr Malcolm Fraser) will have a nice trip overseas. The Government is to save $24m, which is less than one per cent of total Commonwealth expenditure on health costs. The change will significantly increase the cost to individuals. Obviously the Minister has been forced into this by the standover tactics of the Prime Minister. Previously the Prime Minister has not shown any great interest in health funding. Suddenly he has become interested in it. I do not know whether his Principal Private Secretary, who is the son of one of the directors of the Medical Benefits Fund, was one of the people influential in bringing about some of the changes in the attitude of the Prime Minister and forcing Cabinet to sit on at least four separate occasions to consider this matter. Finally it was decided not to do much.

Let me look at the changes proposed by the Government. As the Minister said in his Press statement, by the change the medical benefit will be reduced to 75 per cent of the schedule fee. Inflation is used as the argument for this. The point is that patients have been paying 15 per cent of the schedule fee and the schedule fees have been increasing. The expenditure on the part of the patient has always been indexed at 1 5 per cent of an increasing amount. Now it is to be suddenly increased to 25 per cent. The Government will be paying 75 per cent instead of 85 per cent. That is an approximate decrease of 12 per cent in expenditure on medical benefits in the case of benefits not reaching the maximum. The total expenditure on medical benefits will be of the order of $600m or $700m this year, so one would expect a saving of somewhere between $60m,and $70m just on that item. But the total’ saving will be only $24m. Honourable members can see that obviously some of the other changes will cost the Government money.

The main cost will be due to the changes in bulk billing of medical claims. We were told over two years ago that the Health Insurance Commission estimated that if bulk billing were abolished there would be an increase of $ 10m in administrative costs. Instead of sending out a relatively small number of cheques to a relatively small number of doctors, it would be necessary to check many accounts and send out many individual cheques to individual patients. The Government now proposes to abolish bulk billing for all except pensioners covered by the pensioner health benefit scheme. I have made a quick calculation in respect of this matter. I find that as at 30 June 1977- the date of the last available report of the Department of Social Security- there were 767,000 social service beneficiaries who now will be excluded from bulk billing. I repeat that over three-quarters of a million social service beneficiaries will be excluded from bulk billing. In fact, the number is greater now because many more people are in receipt of unemployment benefits.

At any one time in this country some 150,000 persons are in receipt of sickness benefits. Really, the number of people involved is much larger than 150,000 because these people also have dependants. They are sick and they must attend doctors to receive medical treatment. They will no longer be entitled to receive bulk billing. At that stage-30 June 1977-250,000 people were in receipt of unemployment benefits. There were 51,000 people in receipt of supporting parents benefits and some 9,000 people were receiving special benefits. In addition, 20,000 people in receipt of invalid pensions, 50,000 widowed pensioners, and 272,000 aged pensioners will no longer be entitled to be treated by their doctors and be bulk billed.

The Minister implies in his statement that bulk billing is an expensive item. The Health Insurance Commission tabled its report on 5 May 1978. That report shows that even though 55.6 per cent of all medical claims were bulk billed, they amounted to only 34.9 per cent of the value of all claims. Therefore, the claims are greater in amount in the case of the non-bulk billed claims. The number of medical services for each bulk billed claim averaged 1.28 compared with 2.2 services for all other claims. Again, that shows that if anything there is a greater likelihood of fraud in the case of non-bulk billed claims. The average cost of each medical claim under the bulk billing system was $8.80 compared with $11.50 for each claim on individual accounts. That is nearly 50 per cent more in the case of claims on individual accounts compared with bulk billed claims. Yet, the Minister claims that he is making these changes to save money. Obviously, he is not doing this to save money. He has already saved $50m or $60m by the one change of reducing the amount of refund claimable from 85 per cent to 75 per cent. The total saving involved here is only $24m. Therefore, bulk billing must be costing the Government money.

Why is it abolishing bulk billing? It will cost the Government money to do this. The reason the Government is doing this is pressure from the private medical funds and from the more conservative sections- I emphasise the words ‘more conservative sections’- of the Australian Medical Association. The medical funds do not like bulk billing because it gives a commercial advantage to Medibank. It is obviously advantageous from the contributors point of view to be bulk billed. The medical funds have made no provision for bulk billing with the exception of the

Hospital Benefits Association Ltd in Victoria. I have repeatedly asked the Minister to provide figures to show that in the case of Medibank bulk billing, Medibank private bulk billing or Hospital Benefits Association bulk billing, there is any evidence whatever that bulk billing is costing excessive amounts of money. There is no evidence that this is the case. The Minister has never been able to produce any evidence and it is quite clear from the changes he has introduced today that this has been done purely because of the pressure from the private medical funds which, of course, identify with the Government as the Government identifies with them.

When the Minister for Construction (Mr McLeay) was acting Minister for Health he referred, in a broadcast on the AM program, to the private funds as ‘us’. He said, ‘They will not leave us’, in reply to a question which asked, Will not people leave the private funds?’.

I think that since the honourable member for Gwydir became Minister for Health, he has learnt a little about the medical profession and about medical funds. He is not so completely convinced now that medical practitioners and the representatives of private funds are doing things in the interests of the community only. That is why I feel sorry for the Minister for having to introduce these changes today. I emphasise again that I do not believe for one minute that these changes have been supported by the Minister, his Department or by the Health Insurance Commission. They are changes which have been brought about by pressure from the Prime Minister. The private health funds are to be permitted to introduce as an option a deductibles scheme within their medical and hospital tables. The Minister says vaguely that this could be for an amount of $50, $100 or $200. One assumes that the amount of $200 is not the limit. He says that people would still need to have universal health cover. If there is to be a $200 deductibility, why should there not be a $500 deductibility or a $ 1 ,000 deductibility?

If I were running a private health fund and a person came to me wanting to be a contributor to my fund and was prepared to pay the first $ 1 ,000 of medical and hospital costs, I would charge that person a very low contribution rate. For practical purposes, such people could escape the compulsory insurance cover and opt for the highest possible tax deductibility. That is fair enough for the young person and for the person who earns enough income to claim his medical expenses as a tax deduction. If I were 20 years younger and were in receipt of the income I received when I was a medical practitioner I would be happy to take up that sort of offer. If I had the bad luck to have any member of my family enter a hospital or need to undertake expensive medical treatment, in fact the Government would subsidise any medical expenses I had by an amount between 48 cents or 60 cents in the dollar, depending on what tax rate I was paying.

Yet the people who must remain covered by medical insurance and must keep on paying their contribution rates because they are worried about having high medical expenses must pay a higher contribution rate for this. Such contributions are not a tax deduction. This is completely unfair. The young, healthy and rich person will benefit. The funds will still have to pay almost all the money that they are paying out now because the sort of people who opt for the deductibles will be people who have low medical expenses. The other people will remain in the funds. If the total amount of payout is to be divided amongst a lesser number of contributors, the net result will be that the insurance rates will have to be increased. The Minister talks about a 46 cent deduction in medical insurance rates because of the gap increase. Obviously, if there is a 46 cent saving by increasing the gap from 15 per cent to 25 per cent, the funds will charge at least 46 cents extra for the gap insurance. If I know the funds, they will charge at least 60 cents for providing that gap insurance. There will be no saving for individuals. Those people who are sick and those people who are not well off in the community will be quite significantly worse off

I do not accept the whole argument on the question of gap insurance. It applies mainly to people who are attending general practitioners and that is not the expensive part of medical insurance. The main argument advanced by those people who want to introduce the gap has been its use as a disincentive to individuals to go to the doctor unnecessarily. I do not accept that point but I can see an argument in favour of it. But the Minister emphasised that people will be able to continue to take out additional insurance cover for the extra out of pocket payments. The Minister is destroying that incentive. He is reducing the insurance rate by 46 cents because he is increasing the gap, but the funds will probably charge the individual contributors 60 cents for the extra insurance to cover that gap. There is no incentive for the individual person and the funds will have higher administrative costs. It is a completely pointless exercise. The whole of these changes seem completely pointless. It has taken a statement of 22 pages in length to present these changes to the Parliament but the total value of these changes to the Commonwealth Government is $24m, which is less than one per cent of the total expenditure.

Mr Hodges:

– That is still a lot of money.

Dr KLUGMAN:

-I know that $24m is a lot of money. I emphasised that point the other day when the Prime Minister was spending that amount on VIP aircraft. It is exactly the same sort of money. But the people are not saving $24m; the Government is saving $24m by transferring that payment to individuals. The cost to individuals will be greater than $24m. That $24m represents less than one per cent of the total cost; $30m would be one per cent of the total cost. The Government is bringing about all these changes to gain an improvement of less than one per cent. It is transferring expenditure from a worthwhile area to administrative expenditure in the Department and the Health Insurance Commission. If the Government thinks that that is a step in the right direction, then I am surprised. I am certainly surprised if the Deputy Whip on the Government side, the honourable member for Petrie (Mr Hodges), who usually takes a different sort of line on these issues, takes that particular line. I would have thought that the Deputy Whip, who has some understanding of the problems involved, would realise that the transfer of payments from health expenditure to administration of health expenditure is not a great advancement.

Let me deal with one other point. It concerns the Minister’s proposals in relation to likely changes as far as hospitalisation is concerned. He makes seven points in relation to hospitals. Most of them are fairly meaningless. (Extension of time granted. ) I will not take as long as it took the Minister to produce this statement. The Minister says in his statement than negotiations will be undertaken to make certain changes in the hospital schemes. Most of them are fairly meaningless statements but two of them are not. One is that the Government will require long stay patients in recognised hospitals to contribute towards their accommodation and care as they do in nursing homes. What that means is that pensioners who are long stay patients in hospitals will have to pay $45 a week towards their hospitalisation. Never has it been the case in Australia, as far as I can find out, that pensioners with no other income have had to contribute towards the cost of their hospitalisation. The Minister’s argument is that this puts them on the same level as those in nursing homes. The point is that long term patients in hospitals- people who have had strokes, people who have had fractured thighs or fractured hips- expect to be released from hospital. Suddenly, out of their $52 pension they will have to pay $45 weekly for their hospitalisation. There are two net effects.

Mr Neil:

– The public hospitals are rejecting old long term patients who need fixing up. They have to go to private hospitals or nursing homes.

Dr KLUGMAN:

– The honourable member for St George thinks that that is a good idea. I wonder whether the people in his electorate will think it is a good idea that a lady pensioner, admitted to hospital with a broken hip and who expects to get out of that hospital, will lose her accommodation outside the hospital because she has to pay $45 out of her $52 pension for the hospitalisation. She cannot keep her room going, or keep her flat going, and becomes extremely depressed about the situation. She loses her accommodation and becomes a charge upon the State or the Commonwealth for the rest of her life. It is all very well for the honourable member for St George to smile about this. He does not think he gets any votes from those particular people and he does not care what happens to them. But these are the sorts of people he is trying to hurt and he does not mind hurting them. He is a relatively young bloke and he will probably go for all the deductibles that are possible because he will be able to claim them as tax deductions; but the elderly pensioners in his electorate, who will now have to pay $45 a week for every week they stay in hospital, may well disagree with him.

Mr Bourchier:

– A pensioner gets the same rate, irrespective of where he or she is.

Dr KLUGMAN:

– At the present time pensioners do not have to contribute towards their upkeep in any hospital in Australia. The Government argues that if patients have to pay for hospitalisation, the cost of that hospitalisation will become lower. Yet the Minister cites figures from the State which until recently was- for practical purposes it still remains- the only State providing free hospitalisation. I refer to the State of Queensland. The cost of a hospital bed in Queensland is $100 a day compared with about $140 or $150 a day in all other States. What was the incentive in Queensland to keep the costs down? It had nothing to do with people having to contribute towards those costs because hospitalisation in Queensland has been free for a long time. So obviously other factors are involved. The Minister talks about incorporating some outofpocket payments- reminder payments- for patients who will be in hospital. The suggestion has been made that a charge of $4 a day be imposed on persons who are in hospital as a reminder of the high costs of hospitalisation.

Mr Hunt:

– It has to be an unauthorised stay.

Dr KLUGMAN:

-An unauthorised stay? What is an unauthorised stay? Is it intended to employ officials to check on every hospital to ascertain who is in hospital for an unauthorised stay? As I understand it, an unauthorised stay in hospital would be the case of somebody who had a liedown strike in a hospital; someone who stayed in a hospital bed without authorisation from the medical superintendent or the doctors at the hospital. What are we to do in relation to people who are admitted into public hospitals? The Government claims to have regard for State rights. That same Government now intends to say that the people who are staying at the Prince Alfred Hospital or at some other hospital for a particular period of time cannot stay there any longer because their stay is no longer authorised by the Commonwealth Government; they will now have to pay $4 or more a day. Who will decide whether they are to stay in there longer? Is the patient to make that decision? Who is to decide whether it is an unauthorised stay by the patient? I will be interested to hear what the Minister has to say about that.

The Minister admits that the Government requires more comprehensive information on the health care system to enable it to monitor costs in more detail than is possible at present. I think it is depressing that the Government, knowing that it does not have the figures and facts at its disposal, nonetheless has brought in these changes. The changes are superficial in a financial sense because the saving to the Government is less than one per cent of the total cost; but they are not superficial inasmuch as they will cost individual persons a significant amount of money. The people who will be hurt most will be those in the poorest sections of the community. The Minister emphasises in his statement the fact that the Government is interested in the poor sections of the community. I have shown that 272,000 age pensioners, 20,000 invalid pensioners, 15,000 persons on the widows pension, 51,000 persons on the supporting parents pension, more than 250,000 persons-I think it is now 280,000 personsand their dependants on the unemployment benefit, 1 50,000 persons and their dependants receiving the sickness benefit, and 9,000 persons and their dependants on the special benefit will no longer be able to claim on bulk billing when they go to their doctor.

The Minister says he will have talks with the Australian Medical Association to ensure that the AMA does not charge more than the 75 per cent rate for bulk billing. We know now what the reply from the AMA will be. It will not take 75 per cent instead of 85 per cent from those pensioners who are still eligible. I can predict at this point, and I am prepared to take any sort of bet with the Minister on it, that the AMA will reject the Minister’s proposition to reduce the charges of its members from 85 per cent of the normal fee to 75 per cent. I am surprised that the Minister was prepared to come into the House and put up this proposition. I feel sorry for him for having had to do so. That is one of the difficult aspects about being a Minister.

Mr HUNT:
Minister for Health · Gwydir · NCP/NP

-I claim to have been misrepresented.

Mr DEPUTY SPEAKER (Mr Millar:
WIDE BAY, QUEENSLAND

-If the Minister wishes to make a personal explanation he may do so.

Mr HUNT:

-I claim to have been misrepresented by the honourable member for Prospect (Dr Klugman). He claimed that I did not support the statement I made. I deny that claim entirely. I support the decisions that were taken, and I stand by every word of the statement I made this afternoon.

Mr NEIL:
St George

– I claim to have been misrepresented.

Mr DEPUTY SPEAKER:

– If the honourable gentleman wishes to make a personal explanation he may do so.

Mr NEIL:

– The honourable member for Prospect (Dr Klugman) stated that I was in favour of harsh measures in respect of pensioners in the electorate of St George. I said that public hospitals were refusing to accept geriatric or long term patients and were sending them elsewhere. I said that this was wrong and that something should be done about it. He also claimed that I was smiling in relation to his remarks about distressed pensioners. I make the claim that I was smiling only at the lack of comprehension and the stupidity of the honourable member.

Mr DEPUTY SPEAKER:

– I call on the honourable member for St George to withdraw that expression.

Mr NEIL:

– Which one?

Mr DEPUTY SPEAKER:

-Your final remark.

Mr NEIL:

– I withdraw the claim that the honourable member is stupid.

Debate (on motion by Mr Hodges) adjourned.

page 2406

ASSENT TO BILLS

Assent to the following Bills reported:

Airline Equipment (Loan Guarantee) Bill 1978.

Qantas Airways Limited (Loan Guarantee) Bill 1978.

Softwood Forestry Agreements Bill 1978.

Aboriginal Land Rights (Northern Territory) Amendment Bill 1978.

page 2406

STANDING COMMITTEE ON EXPENDITURE

Mr DEPUTY SPEAKER:

– I have received advice from the Leader of the Opposition (Mr Hayden) that he has nominated the honourable member for Fraser (Mr Fry) to be a member of the Standing Committee on Expenditure in the place of the honourable member for Fremantle (MrDawkins).

page 2406

COAL LOADING FACILITIES: IMPACT ON EXPORTS AND EMPLOYMENT

Discussion of Matter of Public Importance

Mr DEPUTY SPEAKER:

-The Speaker has received letters from the honourable member for Macarthur (Mr Baume) and the honourable member for Capricornia (Dr Everingham) proposing that definite matters of public importance be submitted to the House for discussion today. As required by Standing Order 107, the Speaker has selected one matter, that is, that proposed by the honourable member for Macarthur, namely:

The disastrous impact on exports and employment resulting from the lack of adequate coal loading facilities for the New South Wales black coal industry.

I therefore call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the Standing Orders having risen in their places-

Mr BAUME:
Macarthur

-The House is well aware of the fact that there has been an industrial dispute at Port Kembla which has held up the export of 300,000 tonnes of coal from the southern and south-western areas of New South Wales. The House is well aware of the fact that this dispute has cost something like $ 1 m a day in exports which obviously has a serious effect not only on the Australian economy but also on the economy of the region that I represent. The House is also no doubt well aware that had there not been such a disgraceful lack of adequate coal loading facilities the power of a small, selfish and reckless group of government employees to disrupt the economy of that region could not have been exercised. It is also interesting to note that members of the Australian Labor Party did not rise to support this matter being discussed, Mr

Deputy Speaker, when you called for those members who approved of the discussion to rise in their places. One member of the Labor Party, the honourable member for Cunningham (Mr West), who apparently will be speaking reluctantly on this subject, did not rise to support the discussion of this matter of public importance. His constituents are seriously affected, as are mine, by the disgraceful lack of adequate coal loading facilities. It is interesting to note that he refused to support the discussion of this matter in the House. I am glad to have given him the opportunity that he has not grasped either in the area or in this House.

I now wish to dramatise to the House that the dispute which has brought the matter to a head has not been the major issue. The dispute simply brought to a head a situation which had already reached crisis state.

Mr Neil:

– New South Wales is a crisis State.

Mr BAUME:

-That is true. New South Wales is a crisis State, under a Premier who is now busily engaged in trying to divert attention from the consequences of determined and deliberate policy decisions which have brought about this crisis and which have created a situation in which a $lm a day dispute by employees of the Government can so seriously damage a region and so seriously damage the economy of the area. The interesting thing is that Mr Wran -

Mr Hodgman:

– Also ran.

Mr BAUME:

– I do not see him as an also ran; I see him more as a four-letter word. I would think that his nonsensical attempts to cloud his policy failures by rushing off on a jaunt to America and coming back with claims of non-existent contracts with America are farcical in the context that the southern area does not have the coal loading capacity to meet these contracts and will not have such capacity for many years to come. The State Labor Government, which cancelled the Botany Bay coal loader proposal of the previous Government, has done nothing for two years to replace that coal loader which would have been coming into operation this year. Even more serious is the fact that it took the State Labor Government one full year to make up its mind not to proceed with the Botany Bay coal loader. In the meantime it did nothing to provide any alternative whatsoever. It did nothing to increase the capacity at Balmain. It waited for one year, after it took the decision last May not to proceed with the Botany Bay proposal, before doing one thing. What was required was clearly evident to anyone who had any involvement in that industry. It should have been clearly evident even to the honourable member for Cunningham, although at that time he was busily engaged in involving himself in industrial unrest on the Port Kembla waterfront as a union representative in that area. Part of a tradition is involved.

I stress that it was evident that there would be a massive increase in coal exports from the southern and south-western regions, for a variety of reasons. It was clear, on the understanding from the previous State government that there would be increased capacities, that it was reasonable for the coal mining companies to undertake significant expansion in the area. This they did. There have been very significant increases in capacity in new mines in the Wollondilly area and generally in the Illawarra region. Unfortunately, this expansion has largely been brought to a halt as a result of the Wran Government’s decision not to proceed with the Botany Bay loader. There has been continuing uncertainty for two years about what on earth would happen about coal loading. As a result Clutha Development Pty Ltd has put on ice projects- projected expansions and projected new mines- in the Wollondilly area which would have employed another 600 miners to start with, let alone the many other people who would be involved in the coal mining industry. As a result of the Wran Labor Government’s determined and deliberate policies there is now a contraction, a shutting down and a failure to expand in an industry which could and should have brought expanding employment into my electorate and certainly into the electorates of the honourable member for Cunningham and the honourable member for Hughes ( Mr Les Johnson).

We had a clear indication that there would be an expansion. Of course, a lot of that expansion was already under way and as a result the companies are now looking for a way to get coal out of Australia. For the Premier of New South Wales to criticise the coal companies as he did, saying that they should have known that there was not enough capacity and therefore they should not have entered into contracts to sell coal, is one of the most asinine things I have heard from that notable Premier. It is extraordinary that he should have made that criticism. In the first place, the lack of coal loading capacity is entirely his own fault. He was obliged not to proceed with the Botany Bay coal loader on the basis of a simple and uncomplicated political deal that he made with the left wing in New South Wales, under the Deputy Premier, Mr Ferguson. It was a disgraceful and transparent political deal. That is why Mr Wran cannot backtrack on the decision, although it is evident that Botany Bay is the ideal place for a coal loader. It is all very well for Mr Wran to say that the coal companies should not have entered into those contracts. The alternative to trying to get those sales was to sack coalminers. Is that what the Premier of New South Wales wanted? Is that what his colleagues in this House want? That was the alternative. Let us face it, the coal companies have tried to do the decent thing. They have stockpiled coal until it is coming out of their ears. It is very difficult now to find areas in the Illawarra region and up the escarpment where the stockpiling capacity can be expanded. The State Pollution Control Board, for example, will not allow the coal mines to increase their storage capacity of coal at grass, and all this is a result of determined and deliberate State Government policies. It is extraordinary in this situation that a Labor Premier of New South Wales should criticise coal companies for giving jobs to coal miners, because that is what it means.

It is interesting to look at the other activities that the Wran Labor Government has undertaken in destroying the economics of the area and affecting the economy as a whole in relation to exports. It is extraordinary that the Botany Bay coal loader was cancelled on the basis of an environmental report which was regarded as absolutely vital, absolutely significant. Let me remind the Opposition here and the Labor Government in New South Wales that reports affecting the coal industry, produced at great expense, do not seem to have much impact when they relate to mining under stored waters, as was the case with the Reynolds report. That report recommended that mining should be allowed to continue under stored waters and, as honourable members know, many of the coal companies in the Illawarra region are involved in mining under the upper reaches of the Avon and Cordeaux dams. That report cost $3m; the inquiry was headed by a judge. The State Labor Government has rejected it out of hand. It is extraordinary that when an anti-miner decision is involved the State Labor Government will oppose a report by a judge, even though that opposition is against the best interests of the mining companies and the miners themselves; yet when there is a decision that would be to the benefit of the mining industry, that is, the location of a coal loader at Botany Bay, the State Labor Government hides behind an environmental report which, quite frankly, is very poor indeed in quality. That is particularly significant when it is recognised that the State Pollution Control

Board had recommended Botany Bay as the location for a coal loader. Is it not extraordinary -

Mr Les McMahon:
SYDNEY, NEW SOUTH WALES · ALP

– It is.

Mr BAUME:

– It is extraordinary indeed, as the honourable member says, for the State Labor Government to maintain these consistent antiminer policies that are aimed at bringing about mounting unemployment in the region to the benefit, curiously enough, of the Queensland coal industry. This is the disastrous situation. As the House is well aware, the Japanese steel industry has been obliged to cut back on its imports of Australian coal. It has cut back by only 10 per cent on Queensland coal, but the level of contracts for southern and south-western New South Wales coal has been cut back to something like 63 per cent. Why have the Japanese been able to cut back to that level? The answer, very simply, is that the southern area cannot export more coal. In other words, the Wran Labor Government has provided the Japanese with the greatest excuse one can imagine for discriminating against southern and south-western coal. There is no capacity to get more coal out of the Balmain or Port Kembla coal loaders. Now, because there is something like a two million tonne gap between contracts for the rest of this calendar year and the capacity of the coal loaders in the region to handle it, coal from the southern coalfields is being sent to Newcastle to be exported from there.

Mr Lusher:

– Carrying coals to Newcastle.

Mr BAUME:

– Exactly, carrying coals to Newcastle. It is a nonsensical situation, costing somewhere between $5.50 and $6 a tonne. That is an added burden being imposed on the coal mining industry by the Wran Government. What coal mining companies are going to expand their capacity and increase their employment when they are faced with that kind of expense for some time to come? Let us face it, the Port Kembla coal loader, which is supposed to save the industry from these disasters, has not even been started. The Wran Labor Government has not even made up its mind exactly where the coal loader is going to be. It was going to be off-shore; now it is going to be on-shore. It will not be big enough to cope with the major ships the Japanese want it to cope with. We heard only today that the railway line which was allegedly to go between Picton and Port Kembla is now not going to be built at all. In other words, all the coal from the Wollondilly area that it is said should be railed to Sydney will go via Tempe, within two miles or so of the place where the Botany Bay coal loader would have been located, and there will be an additional cost of $1.60 to take that coal from Tempe to Port Kembla. But that does not matter to the New South Wales Government. It does not matter a damn. If it involves miners losing their jobs, that does not matter; if it involves cancelling the expansion of coal mines, that does not matter, provided that a sordid deal with the left wing in New South Wales relating to some seats on the northern shore of Botany Bay is sustained. That is all that matters to the Wran Labor Government.

I believe this is a most disgraceful situation. In my mind, it is essential that in the first place the State should drop the discriminatory harbourdeepening charge it is imposing on the southern coal that is going to Newcastle harbour. But it has not got the decency to do that. It is essential that the State Labor Government wake up to itself and allow the private enterprise section of this industry to build the Botany Bay coal loader, which will solve the problem at no expense to the State. For two years nothing has happened. For two years this industry has been oppressed. I have been warning in this House and outside it for the last two years about what would happen as a result of that crazy decision. I get no joy from the fact that my forecasts are being proved right, that the Wran Labor Government’s policies have brought about a disastrous situation in this industry and have put at risk so many jobs in my electorate and in the neighbouring electorates in the region.

Mr DEPUTY SPEAKER (Mr Armitage)Order! The honourable member’s time has expired.

Mr KEATING:
Blaxland

-This proposal does not have the support of the Opposition because it provides an unwarranted basis of attack upon the New South Wales Premier. For the first time in two and a half years, when there has been a bit of Press speculation over an issue, the honourable member for Macarthur (Mr Baume) has come in to snap at the heels of the New South Wales Premier, a man who this week has been shown to have the support of 80 per cent of the people of New South Wales. He should treat the honourable member with the contempt that is due to him and take no notice whatsoever of his forbodings. There is an expression that the dogs may bark but the caravan moves on. The dogs may bark on the other side of the House but the caravan of the New South Wales Government will go on in prosperity to another successful election. Let us look at the proposition that has been raised today.

Let us look at the problem. Two problems are involved with coal loading in New South Wales: Firstly, the inadequacy of capacity aggravated by massive stockpiles; and, secondly, an industrial dispute which has been threatening the capacity of the system. Let us just analyse those two things, particularly the industrial dispute which basically has come about because the maintenance staff, the skilled people who kept the coal loader working, were receiving less remuneration than the unskilled people who were operating it. That was the basis of the dispute. Who can settle the dispute- the New South Wales Premier and nobody else. It certainly cannot be settled by the intervention of the Federal Government. The issue of coal loading has not been an acute issue in New South Wales. It has been acute only in the last two weeks. Why is there a problem?

Mr Baume:

– He should not have let it start in the first place.

Mr KEATING:

– The honourable member was heard in comparative silence and he should do me the same honour. Why has the problem become acute in the last two weeks? There are two reasons and two reasons only. Firstly, the size of the cutback in coal purchases by Broken Hill Pty Co. Ltd because of the reduction in steel production and exports to Japan, which were negotiated by the Minister for Trade and Resources (Mr Anthony). This has resulted simply in a massive glut of coal in the New South Wales coal industry, which is now being sold at spot prices and which is now demanding immediate access for the whole lot of the excess capacity to a porting system and a coal loading system which were designed to average out the loads and the tonnages over a 12 month period. That is the basis of the present problem; not an inadequacy in the size of the system but the failure of the policies of the Federal Government which has resulted in BHP steel production being down 24 per cent on last year- 1.2 million tons of finished steel products- which is now less than the production level of 1 973-74.

What has been the effect of the BHP cutback? Unlike the honourable member for Macarthur, I have been in touch with the company to find out the basis for its cutbacks. There has been a 1.7 million ton cutback in coal which had previously been supplied by the south coast and western district mines of New South Wales. What has happened to that 1.7 million tons of coal? It has been stockpiled for sale and export overseas. Now the companies are trying to push the 1.7 million tons through a coal loading facility which of course was never designed- to handle that amount. That is the basis of the dispute. BHP is now exporting 44 per cent of its steel products overseas and it is doing it to save the jobs and the viability of the Australian steel industry. But why does it have to save them? Because of the disastrous languishing state of the Australian economy, because the Austraiian economy is failing to grow- it was even growing negatively in the last quarter of last year- and because of the contraction in the economy, steel production is down and the steel production which is not available for sale domestically is of course being exported to other countries.

That deals with the domestic position. Now let us look at the international position. Kembla Coal and Coke Pty Ltd, and the Bellambi Coal Co. Ltd in particular, have coal running out of their ears and that was so even before the massive BHP cutbacks. Why was the coal coming out of their ears. Because of the failure of the Fraser Government to look after Australia’s interests in Tokyo. When the Minister for Trade and Resources and, not long after, the Prime Minister (Mr Malcolm Fraser) trudged through Tokyo, they were politely given a firm no by the Japanese steel industry and were told that they would have to tolerate the cutbacks in imports from Australia and particularly from New South Wales. The Japanese technique is a case of like it or lump it because if we disagreed with them they do not send ships to pick up the coal. What kind of a protest do we hear from the Minister for Trade and Resources, Mr Anthony? Nothing at all; he came back and announced to the industry that it will just have to tighten its belt.

What has happened? It has the greatest accumulation of coal of any coal companies in the world; not just in Australia. Sensibly, the companies are now trying offshore to sell that massive stockpile. I will give some indication of the nature of the sales. Kembla Coal and Coke is selling coking coal to Pakistan at $A32 a ton while the normal going price in Japan is $A54 a ton. That is a bargain basement price to shift the coal out. Because it is being sold by spot sales and not long term sales the coal must be shifted immediately and because it has to be shifted immediately the companies all want port facilities at the same time. But the port facilities are not designed to take that kind of tonnage and therefore we have a glut. The New South Wales Government, rather than not responding to the problem, is even prepared to have the coal shipped through the Balmain port up to Newcastle where of course there is a new coal loader.

Mr Baume:

– What is the cost?

Mr KEATING:

– The alternative-for my friend who interjects- is to see a continuation of the stockpiles which of course involves massive amounts of money which will finally jeopardise the viability of Kembla Coal and Coke, and particularly Bellambi Coal, and in some respects some of the companies in the western district.

Mr Baume:

– Who is paying the extra amount for it to go through Newcastle?

Mr KEATING:

– The honourable member knows nothing about the New South Wales coal industry. He is a little publicist with a big mouth who comes in here just chanting slogans. He knows nothing about the issue or the industry and has no genuine interest in it.

Mr Baume:

- Mr Deputy Speaker, I take a point of order. I would have thought that you would have given me protection from that vicious personal attack. I ask you do so now.

Mr DEPUTY SPEAKER (Mr Armitage:
CHIFLEY, NEW SOUTH WALES

-I will ask the honourable member for Blaxland to withdraw that remark but in doing so I would like to point out that on one remark about the Premier of New South Wales made during the speech of the honourable member for Macarthur I was about to pull him up but decided against it. In this instance I would ask the honourable member for Blaxland to withdraw his remark.

Mr KEATING:

– I will withdraw it. Let us look at the coal loader position in New South Wales. The Wran Government was a catalyst for getting the Newcastle coal loader constructed and finished. That of course has provided a massive increment to the coal loading facilities in New South Wales. Gollin Holdings Ltd collapsed with Mr Keith Gale, the Prime Minister’s adviser, knocking off $900,000. Of course the company failed and the New South Wales Government had to step in, pick up the tab and get the Newcastle coal loader completed, which it has done. Of course there is more than adequate capacity in Newcastle. The New South Wales Government has announced plans to develop Port Kembla but obviously the honourable member for Macarthur does not know anything about this because he is not up to date with his electorate or the issues. The New South Wales Government has made it quite clear- I want to get this through the thick head of the honourable member for Macarthur- that it will not develop the Botany Bay coal loader.

Mr Baume:

-Mr Deputy Speaker, I take a point of order. I charitably assume that you were talking because you did not draw the attention of the honourable member for Blaxland to the fact that once again he has used a style of debate which is highly offensive personally. I would just ask you if you would draw his attention to his consistent style.

Mr DEPUTY SPEAKER:

-I would ask the honourable member for Blaxland not to make remarks which are offensive on a personal basis to the honourable member for Macarthur.

Mr KEATING:

– The New South Wales Government has said that it will not develop the Botany Bay -

Mr Baume:

– I take a point of order, Mr Deputy Speaker. I asked for the withdrawal of a specific offensive comment. I seek its withdrawal.

Mr KEATING:

– I withdraw it. The New South Wales Government has said quite clearly that it will not develop the Botany Bay coal loader although I have seen today that the honourable member for St George (Mr Neil) and the honourable member for Barton (Mr Bradfield) obviously support this proposal as indeed does the honourable member for Macarthur that this coal loader should be developed. I will be going out of my way to make sure that the electors of those two electorates which are very close in proximity to my electorate know about the behaviour of those members in the House of Representatives and their support for the proposition. The New South Wales Government commissioned Mr Simblist Q.C., to look at this issue and he said that the Botany Bay coal loader had an effect upon the Botany community which was distressing, degrading and disturbing, and he said that because of the priorities in New South Wales and because of the lack of -

Mr MacKenzie:

– What about Newcastle?

Mr KEATING:

– Just listen. Because of the lack of facilities at Port Jackson there had to be a priority system established for the development of Botany Bay. The major priority is that there is no other alternative for a very large container terminal but there are other alternatives for coal. Therefore the container terminal must be built at Botany Bay meaning an increase in bulk liquid capacity. Because the rail system would then be up to capacity carrying containers, coal must then therefore go to Port Kembla. The New South Wales Government logically has decided to develop Port Kembla. Again just to pick up the inadequate knowledge of the honourable member for Macarthur, the United States firm, Soros, is already starting preparatory work so that shows just how much he knows about Port Kembla and his own electorate. Botany Bay will not be developed. I will stress that again: It will not be developed but Port Kembla will be developed. There will be more than enough capacity to handle coal from the western district, the Oakbridge mine, Kembla Coal and Coke, Bellambi- the whole lot of the coal from the western and southern district- through Port Kembla. There will be a loading capacity of 1 5 million tonnes there by 198 1 whereas at present there is a capacity of only 8 million tonnes.

The issue is quite simply that the present glut is the conscious result of Federal Government policy, both in trading and the management of the domestic economy through cutbacks in BHP steel production. They are the major reasons. Yet these humbugs come into the House today suggesting that it is the fault of the New South Wales Premier. In fact, the New South Wales Premier came back from overseas, not with the forebodings of the Minister for National Resources who announced cutbacks and announced some business, some contracts with the United States- that is in contradistinction to the failure of the Federal Government- to try to get New South Wales working. So honourable members opposite can eat their little hearts out. There is no way that they will defeat him at the next election or in subsequent elections. He has the thing won before he has started. We will be developing Port Kembla; we will be expanding the capacity of the New South Wales coal mines and coal loading facilities in due course, in line with market demand, and we will note and communicate to the electors of St George the views of the Government parties and their members that they want to develop the Botany Bay coal loader. We will make that abundantly clear to them.

We reject out of hand the nonsensical and foolish proposition raised by the honourable member for Macarthur which is typical of the kind of slipshod propositions, propagandist propositions, that he raises in this chamber. It is unworthy of him as a supposed representative of the Illawarra region of New South Wales. My colleague the honourable member for Cunningham (Mr West), who will follow me in the debate, will make quite clear where he stands relative to Port Kembla and Botany Bay and where the Opposition in this House stands. We stand firmly behind the New South Wales Government which is embarking on policies which are conducive to the ongoing development and expansion of the New South Wales coal industry and the coal loaders. The reason for this present glut is not the industrial dispute, which may have aggravated it but which has been now settled by the New South Wales Premier; the reason is the failure of Federal Government policy to get BHP back on its feet, to get steel produced in the BHP steelworks sold in Australia and to sell this massive stockpile of contracted tonnages- this is not production which is available- in relation to which the Japanese should have been obliged to honour their agreement. Of course, the Minister for National Resources failed to sell it to them because he lacked the gumption and the wherewithal to impress upon them the viability of the New South Wales mines. Honourable members opposite should not put forward these kinds of propositions again in this House. They are unworthy of them and they are unworthy of the House. We reject them completely.

Mr MacKENZIE:
Calare

-I rise to participate in the discussion of this most important issue, not only because the issue is particularly important to the nation and to New South Wales but also because it is particularly important to my electorate which includes the towns of Lithgow, Wallerawang and Cullen Bullen. Prior to the redistribution it also included Ulan, the area which my friend the honourable member for Paterson (Mr O ‘Keefe) now represents. Those areas constitute almost the entirety of the western coalfields of New South Wales. Honourable members would well know that in towns like Lithgow the economy has been substantially and traditionally based on coal. I realise, now representing those areas, having taken them over from the particularly good representation of my colleague who is now the honourable member for Macquarie (Mr Gillard), that there is tremendous potential in the western coalfields of New South Wales, a potential of proportions that is hardly to be seen anywhere else in New South Wales or in Australia. There is a significant proportion of the uncommitted world reserves of steaming coal in particular in that area. There is enormous potential for increasing the work force. The work force could be almost doubled within the next five or eight years. What areas in Australia can boast of that tremendous potential at present available in the western coalfields area of New South Wales?

What a long way that is from the prediction in 1 964 of the present Minister for Mines and Energy in New South Wales, Mr Hills, I think, who said: ‘Forget the coalmines; the Lithgow Valley will become a valley of small factories’. At that time the work force in the mining industry in the western coalfields area of New South Wales was declining. It was declining because of technology and mechanisation within the industry and because of the orders and the export prices which were available. The outlook at that time for the western fields was, to say the least, somewhat bleak. Now we see this enormous growth potential. We see confidence in the private sector. We see new mines being developed by the private sector. We see new loaders, handling equipment, and washing equipment; we see new sidings, roads and the whole infrastructure which goes with a substantial mining development. We see very significant improvements in conditions and awards and wages within the industry, which result in a spin-off to the whole area. We see companies which for the first time in many years, and in some cases for the first time ever, have been able to get away from the line ball operation, have been able to pay dividends and overcome some of their cash flow problems. They are prepared to put risk capital into a major venture of national importance.

The key to all this development and to confidence in that development is the assurance of sufficient loading facilities so that we can meet these export opportunities. The Botany Bay coal loader was to be financed by the companies concerned and was to be operating before the end of this year. An undertaking was given by the previous coalition government in New South Wales to develop that facility and that undertaking has again been given by the leaders of the coalition parties. It seems to me to be somewhat ironic to hear complaints by the honourable member for Blaxland (Mr Keating) about the environmental impact this will have on the Botany Bay area. I have before me a photograph of the Port Waratah coal and ship loading facilities. It seems somewhat ironic that in this photograph we can see that the main storage dump is within hundreds of yards of residential areas. It seems to me that there were no great objections to the expansion of the Balmain facility. Are not the people of Balmain and Newcastle as important as the people of Botany Bay? Quite obviously politically they are not.

The Port Kembla alternative is one which is in complete limbo. There was to be a huge facility offshore to provide loading facilities for large carriers. It has now apparently been decided not to go ahead with that proposal. I say ‘ apparently ‘ because I cannot find out anything definite. I must admit that the prediction of the honourable member for Blaxland that there will be a 1 98 1 deadline for a 15 million tonne capacity loading unit has not been reiterated by the Premier of New South Wales. To my knowledge that is certainly not the case but I would be interested to receive the Press release if it is the case. What has happened to the rail link that was proposed for the development at Port Kembla? That seems to have been scrapped. The honourable member for Macarthur (Mr Baume) pointed out the quite ludicrous situation in which we would see southern and western coal going through the junction at Tempe which is virtually next door to the proposed facility at Botany Bay. Within the next seven months we face a shortfall of at least two million tonnes in contracts already signed for coal from these areas, contracts worth in the vicinity of at least $60m.

What are we to do? Are we to leave it in the ground and put up with the retrenchments that will flow from that? Can we accept the criticism of Mr Hills, the Minister for Mines and Energy, who blames the situation on increased exports? He blames the companies that are prepared to get out and fight in a competitive market, in some cases very competitive because they have only low grade steaming coal. He blames these companies that are prepared to continue their operations to ensure continued employment, who are prepared to put risk capital into expansion of their businesses. Mr Hills was blaming those companies at the same time as his own Premier was enthusiastically claiming that New South Wales had tremendous potential for servicing the American market, the Californian market in particular. What does Mr Wran do? He tries to blame the Federal Government for policies that have apparently reduced steel demand in Australia. I suggest that he look back a little further to the record of the previous Labor Government in this place. Most of the problems arose from there. It is ironic that Mr Wran returned so wildly enthusiastic about these markets and these potentials. I only say that he will have to do a lot better than than. Wild enthusiasm in the face of reality will not ensure continued export contacts and continued development of the industry, particularly in the western coal fields area about which I am particularly concerned.

Let us look at the extra charges that these companies are expected to pay. There is an additional levy of 90c per tonne on top of additional costs of some $2 port loading costs, $4 extra freight costs, and the totally ridiculous irony of a $ 1 levy on those companies. That levy is provided for the Newcastle harbour deepening program which is an ongoing project and which will not benefit the western or the southern coalfield companies. We are told that it is only a temporary measure to overcome a short term difficulty. It seems to me to be highly inequitable that these companies are required to pay, on top of all those other burdens, this $ 1 charge which is for a facility that will not be enjoyed by them in the future but by the Hunter Valley coalfields.

Mr Wran has given an undertaking that the western coalfields will not be disadvantaged in any way at all. The 90c levy, to the industry at Lithgow alone, will amount to some additional $2. 5m in the next seven months. This is a levy on an industry which was not going to be disadvantaged. The companies in the Lithgow area are required to pay demurrage on the days lost by the shippers and the freighters, because of those ships which we see caught up in the harbour at Port Kembla.

I think the photograph that we saw in the media yesterday was a total indictment of the Wran Government. Mr Wran will have to do a lot more than this. He will have to do more than pose prettily beside his helicopter as we saw in a picture in the Press today. If he is to be the smiling saviour of the coal industry in New South Wales he had better hurry up and rectify the situation, because at the moment he is handing over opportunities to Queensland and to other countries.

Mr WEST:
Cunningham

-From the Government side today we have not heard a genuine debate on the need for new coal export facilities in New South Wales, but rather we have been subjected to the desire of the honourable member for Macarthur (Mr Baume) to influence his miner constituents in the Burragorang Valley and along the south coast, particularly in the Dapto area. He has been well known as a financial wizard for some time. We have also known him in the role of writing misleading letters to miners in his electorate at election time. Now he would have us believe that he has blossomed out into an authority on international trade, in this particular instance, the coal trade. I suggest that if the honourable member for Macarthur and the Government really want to help in these matters they should urge the Treasurer (Mr Howard) to implement a number of steps. They should include the implementation of a resources tax on coal exports so that we can get some money back into coal transport arrangements and coal facilities. There should be a national coal marketing authority, and the Federal Government should have some urgent talks with the Government of New South Wales regarding the provision of finance for much-needed export roads, new railways and storage areas. If Government supporters did that they might be a little more constructive. But they are not doing that.

Let us have no more of this mealy-mouthed opportunism from the honourable member for Macarthur. He and the rest of the Government back benchers sit around like parrots on biscuit tins. Where are the Ministers who should be speaking on this issue? The back benchers sit there like a lot of magpies. They are on the Government, but they are not in the Government. We think this is so important a matter that our shadow Minister spoke on the issue. But where is the Minister for National Development (Mr Newman)? He is not even in the chamber. However, I address myself to these important matters. Firstly let me deal with the industrial dispute which occurred in Port Kembla over the last few days and which, as my colleague has pointed out, was solved not by the Federal Government but by the unions concerned and by the Premier of New South Wales. I tell the House that those men had a case, as the honourable member for Blaxland (Mr Keating) has said. The people who had to maintain that installation at Port Kembla were receiving $3.90 an hour as members of the Federated Ironworkers Association, and their colleagues- workers in the Federated Engine Drivers and Firemens Association who work the loader- were receiving $4.75 an hour. Mr Wran can take some credit for solving that dispute, for getting the men back to work and for getting the coal moving again. But all we have had from the honourable member for Macarthur and the honourable member for Calare (Mr MacKenzie) has been opportunist humbug. Today they have not put before us one concrete fact.

Mr Baume:

– Botany Bay was a concrete proposal.

Mr DEPUTY SPEAKER (Mr Armitage)Order! The honourable member for Macarthur has already spoken in this debate. He has been continually interjecting since and has been quite unruly in some of those interjections. I call upon the honourable member for Macarthur to cease interjecting.

Mr Baume:

- Mr Deputy Speaker, I raise a point of order. The honourable member for Cunningham specifically pointed to me as saying that I had made no concrete suggestions whatsoever. That is deliberately untrue.

Mr DEPUTY SPEAKER:

-Order! The honourable member for Macarthur will resume his seat. He knows that that is not a point of order. He knows that it is a frivolous point of order.

Mr Baume:

– I was objecting to your ruling, sir.

Mr WEST:

– Let me deal with some concrete facts. The problems with coal in New South Wales- for the information of the honourable member- really stem from an oversupply situation and not from the fact that companies cannot get orders away. That was a temporary situation. The downturn in world steel is the reason for problems in coal exports. The European Economic Community is producing at 70 per cent of capacity, Japan at 70 per cent and Australia at 80 per cent. I ask for leave to incorporate in Hansard a table containing figures that show the production of steel by Broken Hill Pty Co. Ltd at its Austraiian Iron and Steel Pty Ltd works at Port Kembla over the last 2 years to illustrate that domestic steel production is falling.

Leave granted.

The table read as follows-

Mr WEST:

-The situation is that all through 1977 and early 1978 the Japanese have been cutting back on their coal imports from Australia. They have discriminated against the south coast fields. This occurred last year, not this year. In the year to 30 March 1978, long before this industrial disputation had occurred, the cuts on the Kembla coal and coke contract had been from 2.3 million tonnes to 1.6 million tonnes. That company operates the biggest underground mine in Australia, the Coalcliff Colliery, and it will not do any better this year. Utah Development Co. during that same period exported some 1 1 million tonnes of coal from its four mines at Peak

Downs, Goonyella, Saraji and Blackwater which was 87 per cent of its written contract for 1977. The south coast mines were subjected to price discrimination. Utah had been undercutting them. That, in my opinion, is the reason why, when the chips were down, the Japanese preferred to take a higher percentage of their coal imports from Queensland mines.

Until recently I had a great deal of sympathy for Kembla Coal and Coke. Then I read in the Australian Financial Review that the Company had undertaken to sell coal to India at $US40 a tonne, that is approximately $A34. That creates a very dangerous situation when they try next year to undertake further negotiations with the Japanese. If we say that there is an excess of orders that cannot be supplied because of the situation within the ports in New South Wales we do not see the whole problem. Over the last few years Kembla Coal and Coke has invested $5 4m to develop their new mine at Westcliffe. It came on stream last year. It was supposed to provide 2 million tonnes a year for the Japanese trade. It has been producing less than one million tonnes a year.

The reason is not that the company could not get its coal away but that the opportunity to sell the coal to Japan was just not there because of the downturn in world steel production. A number of new mines which were proposed are not now going ahead. Broken Hill Pty Co. Ltd, Kembla Coal and Coke Pty Ltd, Bellambi Coal Co. Ltd and so on were involved. The names of the proposed mines, which the honourable member for Macarthur did not bother to tell us, were to be: Cordeaux, Towers, Corrimal No. 1, Eastcliffe and Northcliffe. The only new mine that has been opened is Westcliffe. The development in these new mines now is just not on. The reason is the collapse of world steel production and therefore a reduction of the need to produce coking coal. The Japanese do not want to buy as much coking coal.

There is one really big factor with regard to the port congestion at Port Kembla right now. It again revolves around the downturn in world and domestic steel production. I have had Port Kembla figures incorporated in Hansard. Honourable members can see them in black and white when they are printed. Because of the fall in domestic consumption of steel BHP is currently purchasing 1.5 million tonnes of coal less per year. The mines that have been producing this coal- notably Austin Bhutta, Coalex and Clutha- have been attempting to sell it on the overseas market as steaming coal. Because they have been successful to some extent in selling that coal as steaming coal on the overseas market there has been an added strain on facilities at Port Kembla.

In conclusion, there is no question that the loader at Port Kembla will go ahead. The Government might as well forget about flying kites, talking about going back to Botany Bay. It can forget about Botany Bay. Soros, a major United States firm, has already started preparation for the new coal loader at Port Kembla. It will be an on-shore loader situated where the multipurpose berth now is. I contacted the Premier’s office this morning and was assured of these facts. The loader will be completed by early 1981. As an interim measure the present loader has been upgraded to a capacity of 6 million tonnes a year until that date.

Mr DEPUTY SPEAKER (Mr Giles:
WAKEFIELD, SOUTH AUSTRALIA

-Order! The honourable member’s time has expired. The time for the discussion has concluded.

page 2415

TARIFF PROPOSALS

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– I move:

The Customs Tariffproposals I have just tabled relate to proposed alterations to the Customs Tariff Act 1966. Proposals No. 13 provides for tariff changes arising from the Government’s decision on recommendations by the Industries Assistance Commission in its report on metal working machine tools. The effect of the decision is that power operated metal working machine tools at present subject to a general tariff rate of 26 per cent and eligible for bounty will become free of duty over a three-year period. In the first year they will be dutiable at 26 per cent general and 19 per cent preferential; in the second year at 20 per cent general and 19 per cent preferential; and in the third year at 10 per cent general and 10 per cent preferential. Other power operated metal working machine tools and parts for use as original equipment in the assembly or manufacture of power operated metal working machine tools will be free of duty from tomorrow.

The Government has also decided that from tomorrow a bounty is to be paid on certain power operated metal working machine tools produced and used in Australia and that a bounty on local design content be introduced. Legislation to give effect to this decision is being drafted and I will introduce it in the Budget sittings. Changes of an administrative nature are also contained in the Proposals.

Proposals No. 14 provides for the reduction in duty from 1 January 1 978 on a further group of commodities added to Schedule ‘A’ of the New Zealand Australia Free Trade Agreement. A comprehensive- summary of the changes contained in the Proposals has been prepared and is now being circulated to honourable members. I commend the Proposals to the House.

Debate (on motion by Mr Young) adjourned.

page 2416

ASHMORE AND CARTIER ISLANDS ACCEPTANCE AMENDMENT BILL 1978

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

Second Reading

Mr ADERMANN:
Minister for the Northern Territory · Fisher · NCP/NP

– I move:

The purpose of this Bill is to amend the Ashmore and Cartier Islands Acceptance Act 1933 so that, from 1 July 1978, the Territory of Ashmore and Cartier Islands will be treated as a separate Commonwealth Territory. At present, section 6 of the Act provides for the Territory to be annexed to, and form part of the Northern Territory, and for the laws in force in the Northern Territory to apply to it. This situation would not be appropriate after self-government is conferred upon the Northern Territory.

The Bill provides for laws for the government of the Territory of Ashmore and Cartier Islands to be made by the Governor-General. The resultant principal Act will be similar to the Acts governing other Commonwealth Territories except that for the purpose of the application of Commonwealth Acts, and consistent with thencurrent status, the islands are to be regarded as an internal mainland Territory. I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2416

REMUNERATION TRIBUNALS AMENDMENT BILL 1978

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

Second Reading

Mr STREET:
Minister for Employment and Industrial Relations · Corangamite · LP

– I move:

This Bill is consequential upon the Northern Territory (Self-Government) Bill 1978. Its purpose is to amend the Remuneration Tribunals Act 1973 in order to remove from the Tribunal’s jurisdiction the determination of remuneration for members of the Legislative Assembly, members of the Executive Council and Ministers of the Territory. The amendment is in accord with the wishes of the Northern Territory Executive. The Northern Territory (Self-Government) Bill 1978 provides that the Northern Territory Government may, if it so wishes, confer on the Tribunal by enactment the function of reporting on remuneration in respect of these offices. The ultimate responsibility, however, for the determination of remuneration for these offices will rest with the Northern Territory Government. I commend this Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2416

LANDS ACQUISITION AMENDMENT BILL 1978

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

Second Reading

Mr STREET:
Minister for Employment and Industrial Relations · Corangamite · LP

– I move:

The purpose of the Bill is to amend the Lands Acquisition Act 1955 so that it will continue to have application for Commonwealth purposes in the Northern Territory after self-government. A special provision is incorporated to free statutory authorities of the Northern Territory from the requirement to have acquisitions of real property for their purposes effected under the Act. If” it is decided later that any statutory authority of the Northern Territory should have its acquisitions effected under the Act, this may be declared by regulations. I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2416

PAY-ROLL TAX (TERRITORIES) ASSESSMENT AMENDMENT BILL (No. 2) 1978

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

Second Reading

Mr HOWARD:
Treasurer and Acting Minister for Finance · Bennelong · LP

– I move:

The Government’s announced program for the development of self-government in the Northern Territory includes the transfer to the proposed Northern Territory Government of the function of levying pay-roll tax on wages related to that Territory from 1 July 1978. For some years, payroll tax on such wages, together with wages related to the Australian Capital Territory, has been collected by the Commonwealth under the terms of the Pay-roll Tax (Territories) Assessment Act 1971.

The purpose of this Bill is to amend that Act to render it inoperative in relation to wages related to the Northern Territory that become payable on or after 1 July 1978, thus leaving the way open for the proposed Northern Territory Government to levy its own pay-roll tax on such wages. As a consequence of the contemplated amendments, employers will be liable for tax under the Pay-roll Tax (Territories) Assessment Act on wages payable on or after 1 July 1978 only where the wages are paid or payable in respect of services rendered wholly in the Australian Capital Territory, no matter where they are paid, or where the wages are paid or payable in that Territory in respect of services which are not rendered wholly within the Northern Territory or one of the States.

Accordingly, employers will not be liable for Commonwealth pay-roll tax on wages payable on or after 1 July 1 978 where they are paid or payable in respect of services rendered wholly in the Northern Territory or where they are paid or payable in that Territory in respect of services rendered elsewhere unless the services are rendered wholly in the Australian Capital Territory. Explanations of technical aspects of the Bill are contained in an explanatory memorandum being made available to honourable members. I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2417

NORTHERN TERRITORY SUPREME COURT AMENDMENT BILL (No. 2) 1978

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

Second Reading

Mr VINER (Stirling- Minister for Aboriginal

Affairs) (5.18)- I move:

This Bill is consequential upon the Northern Territory (Self-Government) Bill 1978. It will amend the Northern Territory Supreme Court Act 1961 in three major respects. Firstly, it will specifically confer jurisdiction on the Supreme Court of the Northern Territory in suits between the Commonwealth and the new political entity of the Northern Territory created by the Northern Territory (Self-Government) Act. The Government considers that the question of legal actions between the two governments should be the subject of specific provisions in Commonwealth legislation. The Territory legislature will be able to enact its own legislation concerning suits against the Territory Government by any other person.

Secondly, the Bill will enable Territory legislation to make provision for the prosecution on indictment before the Supreme Court of indictable offences against Territory law. The Commonwealth Attorney-General ‘s authority to prosecute offences on indictment in the Supreme Court will be restricted to offences against Commonwealth law. Transfer of administrative responsibility for Territory criminal law to the Territory authorities has already taken place. It is clearly appropriate that the prosecution of Territory indictable offences in the Supreme Court should be the subject of Territory law.

Thirdly, the conferral of jurisdiction on the Supreme Court in respect of the Territory of Ashmore and Cartier Islands is to be removed from the principal Act. A legal systen applying to those islands is to be the subject of separate legislation, which will confer jurisdiction on Northern Territory courts. I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2417

ADMINISTRATIVE APPEALS TRIBUNAL AMENDMENT BILL 1978

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

Second Reading

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

-I move:

This Bill is consequential upon the Northern Territory (Self-Government) Bill 1978, and amends the Administrative Appeals Tribunal Act 1975. The principal Act provides for the review of administrative decisions by the Administrative Appeals Tribunal. The Government considers that the Tribunal should not have jurisdiction to review decisions made under statutory powers conferred by Northern Territory laws in respect of matters within the authority of the Territory Government. The Bill will remove the present ability to confer such jurisdiction on the Tribunal.

However, the Bill provides that regulations may be made conferring rights of appeal to the Tribunal in respect of decisions made under Territory laws that will continue to be administered by the Commonwealth Government. Certain existing provisions of Territory law which confer jurisdiction of this kind are to be continued in force. I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2418

ADMINISTRATIVE DECISIONS (JUDICIAL REVIEW) AMENDMENT BILL 1978

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

Second Reading

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

-I move:

This Bill is consequential upon the Northern Territory (Self-Government) Bill 1978. It amends the Administrative Decisions (Judicial Review) Act 1977,- and is to come into operation on the date upon which the Administrative Decisions (Judicial Review) Act itself comes into operation. That will not occur before 1 July 1978.

The Administrative Decisions (Judicial Review) Act provides for review by the Federal Court of Australia of certain administrative decisions. The Government considers that the Federal Court should not be given jurisdiction to review dicisions made under statutory powers conferred by Northern Territory laws in respect of matters within the authority of the Northern Territory government. However, the Bill provides that regulations may be made conferring rights of review by the Federal Court of decisions made under Northern Territory laws that will continue to be administered by the Commonwealth Government.

The Government considers, also, that when he is acting in his capacity as Administrator of the Northern Territory, decisions made by the Administrator should not be subject to review by the Federal Court. Decisions of the GovernorGeneral and of the State Governors are likewise not subject to review. Since the Administrator’s powers, as Administrator, flow from the Northern Territory (Self-Government) Act, the Bill will exclude from review by the Federal Court all decisions made under that Act. I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2418

COMMONWEALTH MOTOR VEHICLES (LIABILITY) AMENDMENT BILL 1978

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

Second Reading

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

-I move:

This Bill is consequential upon the Northern Territory (Self-Government) Bill 1978 and amends the Commonwealth Motor Vehicles (Liability) Act 1959. That Act makes provision regarding claims for damages against the Commonwealth, or a Commonwealth statutory authority, caused by its vehicles. It is not appropriate for the Act to apply to statutory authorities which are created by Northern Territory laws and which are under the administrative control of the Territory government. Under this Bill, such statutory authorities will cease to be authorities to which the Act applies.

However, there will be a small number of Territory statutory authorities which will remain under Commonwealth control and the principal Act should continue to apply to them. For this reason, the Bill provides for the making of regulations declaring a Territory statutory authority to be a Commonwealth authority for the purposes of the Act. I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2418

COMPENSATION (COMMONWEALTH GOVERNMENT EMPLOYEES) AMENDMENT BILL 1978

Bill presented by Mr Viner, (on behalf of Mr Hunt) and read a first time.

Second Reading

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

-I move:

As indicated by my colleague, the Minister for the Northern Territory (Mr Adermann), this Bill is consequential upon the Northern Territory (Self-Government) Bill 1978. The main purpose of the Bill is to ensure the continued application of the Compensation (Commonwealth Government Employees) Act 1971, after 1 July 1978, to members of the Public Service of the Northern Territory and certain other persons who are currently entitled to receive benefits under that Act. The Bill also provides that any payments of compensation under the principal Act made as a result of this legislation shall be payable by the Northern Territory and not by the Commonwealth Government. The amending legislation is intended to come into operation on 1 July 1978. 1 commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2419

AIR ACCIDENTS (COMMONWEALTH GOVERNMENT LIABILITY) AMENDMENT BILL 1978

Bill presented by Mr Viner (on behalf of Mr Hunt), and read a first time.

Second Reading

Mr VINER (Stirling-Minister for Aboriginal

Affairs) (5.28 )-I move:

This Bill is consequential upon the Northern Territory (Self-Govemment) Bill 1978 and it will ensure the continued application of the Air Accidents (Commonwealth Government Liability) Act 1963-1976, after 1 July 1978, to members of the Public Service of the Northern Territory to whom that Act currently applies. I should mention that any payments made under the principal Act to these employees after 1 July 1978 will be made by the Northern Territory and, therefore, this amending legislation will not result in any cost to the Commonwealth Government. The opportunity has been taken, in clause 3 of the Bill, to make a minor formal amendment consequential upon the Acts Citation Act 1976. The amending legislation is intended to come into operation on 1 July 1978.I commend the Bill to the House.

Debate (on motion by Mr Young) adjourned.

page 2419

SUPPLY BILL (No. 1) 1978-79

Second Reading

Debate resumed from 10 May, on motion by Mr Howard:

That the Bill be now read a second time.

Mr STALEY:
Minister for Post and Telecommunications · CHISHOLM, VICTORIA · LP

- Mr Deputy Speaker, may I have the indulgence of the House to raise a point of procedure on this legislation. Before the debate is resumed on this Bill, I would like to suggest that it might suit the convenience of the House to have a general debate covering this Bill and the Supply Bill (No. 2) as they are associated measures. Of course, separate questions will be put on each of the Bills at the conclusion of the debate. I suggest, therefore, that you permit the subject matter of both Bills to be discussed in this debate.

Mr DEPUTY SPEAKER (Mr Drummond)Is it the wish of the House to have a general debate covering both measures?

Mr Young:

– Certainly.

Mr DEPUTY SPEAKER:

– I will allow that course to be followed.

Mr ARMITAGE:
Chifley

-On behalf of the Opposition, I move:

In moving this amendment, I wish to refer to various aspects of Government policy on this matter. In particular, I wish to refer immediately to the issue of unemployment and the very high levels of unemployment that now exist. Previously, the Government has been endeavouring to denigrate the figures issued by the Commonwealth Employment Service and to utilise the figures of the Australian Bureau of Statistics. Next, it will be wanting to use even the figures of Gallup polls to provide an indication of unemployment in this country. How on earth Gallup polls could give any reasonable assessment of the unemployment position is beyond my comprehension. I refer at this stage to the very latest unemployment figures which are for April 1978. The figures for the Australian Bureau of Statistics show that 401,700 people are unemployed whereas the figures of the Commonwealth Employment Service show that 402,500 people are unemployed. In other words, today the difference between the two sets of figures is less than 1,000. The Government has lost its excuse in its attempt to try to avoid the facts of life, that is, that unemployment in this country today is at record levels- higher than at any time since the Depression- and is steadily growing.

I will give an indication of how unemployment is growing. Once again, the Government has tried to evade this issue by ceasing the publication of seasonally adjusted figures. It has stated that it will issue only the raw figures. Only yesterday, 23 May, the Australian Financial Review- hardly a young radical newspaperpublished estimates of the seasonally adjusted unemployment figures. I will cite the figures for the four months since January of this year. In January, the seasonally adjusted unemployment figure was 374,000 people; in February, the seasonally adjusted figure was 388,000 people; in March, the seasonally adjusted figure was 402,000 people; and in April, the seasonally adjusted figure was 407,000 people. That seasonally adjusted figure for April 1978 compares with the seasonally adjusted figure in April of last year of 326,000 people and with a seasonally adjusted figure for April 1976 of 271,000 people. In other words, in the three years since 1976 the seasonally adjusted unemployment figures for the month of April have risen from 271,000 people to 407,000 people. Between January last year and January of this year unemployment had increased from 289,000 to 374,000 persons. That is a massive increase.

Of course, it cuts right into the principles of our society- the dignity of man, the right of man to work, the very question of the deterioration that occurs in a person as an individual, as a human being, in his attitude to life when he does not have work. Yet we have a government which is quite cynical, quite irresponsible, and which has deliberately followed a policy of increasing the level of unemployment in what it terms its battle against inflation. Today it is saying that its battle against inflation is succeeding. An examination of what is happening in other countries reveals that the rate of inflation in this country is being reduced at a rate lower than that experienced in comparable countries such as Japan, the United States, Switzerland and Germany.

Let us look at the history of the inflationary cycle which has beset the world. Let us keep in mind that Australia has a tendency always to catch up much later than other countries. Basically the inflationary cycle was started when the United States set about financing the Vietnam war by printing money. It introduced virtually no restrictions at home; it superimposed a wartime economy on top of a peacetime economy. It then virtually set about printing money. The United States dollar was a very important currency and that action had an impact right around the world and created inflation right around the world. That process caught up with this country in the early part of this decade. Because the rate of inflation is reducing in other countries, so it is reducing in this country. The Government tries to claim credit for that. In other words, there has been a worldwide movement which was brought about in the first instance by the United States virtually printing money to finance the Vietnam war. That created inflation throughout the world as the United States dollar is a world currency. The resources boom also generated inflation. Today inflation in countries with economies comparable to our own, such as Japan, is reducing at a far faster rate than it is in this country. After all, Japan is our major trading nation. As far as Australia is concerned, Japan is the major trading nation of the world. Inflation in that country is reducing far more quickly than it is here in Australia. But the Government takes the credit for that situation.

The Government’s approach to economic policy has been an extraordinarily simplistic one. Its approach has been this: ‘Right, we will increase unemployment as our way of fighting inflation’. That is a very cynical, heartless approach which has no respect whatsoever, as I said earlier, for the right of a man or a woman to work or for the dignity of men and women. That approach reduces demand, that very essential ingredient which I mentioned in the amendment which I moved earlier in my remarks. After all, if we are to have more than 400,000 people unemployed in this country- that is 400,000 subsisting on the unemployment benefit instead of receiving reasonable wages, not necessarily as high as average weekly earnings- then naturally demand will be reduced. Once those people return to work, straight away they will go to the shop; straight away the shop owner will go to the factory; and then the factory owner will go to the labour market, just as the shop owner will go to the labour market. Accordingly, people will once again be employed.

The Government has lost sight of this fact. It does not seem to realise that the reduction in the rate of growth in the Australian economy has been brought about by its own foolish policiespolicies which must create more and more unemployment. I refer, for example, to the Government’s own cutbacks in expenditure. In cutting back its own expenditure it has forgotten the very basic fact that government is the biggest single buyer from industry. When government ceases to buy or dramatically reduces its volume of purchases from industry that immediately has an impact upon industry and creates unemployment.

I return to the figures to which I was referring earlier. I have cited the seasonally adjusted figures published by the Australian Financial Review. They show quite clearly that as from January 1 976 when this Government took office, unemployment has risen, on seasonally adjusted terms, from 289,000 to 374,000 persons. From April 1976 to April of this year, the number of unemployed, on seasonally adjusted terms, has risen from 271,000 to 407,000. 1 have also shown that the Government can no longer say that it would rather believe the figures produced by the Australian Bureau of Statistics than those produced by the Commonwealth Employment Service. The figures produced by the Commonwealth Employment Service indicate quite clearly- these are raw figures and are not on seasonally adjusted terms- that the number of unemployed as at April of this year was 402,500, whereas those produced by the Bureau of Statistics indicate that the number of unemployed was 401,700. In other words, the difference between the two sets of figures is only 800. For that reason the Government can no longer fall back on those figures. It has to face reality. Let us return to the figures for 1976. The Commonwealth Employment Service figures show that there were 268,000 people unemployed in 1976, compared with 402,500 unemployed as at April of this year. In other words, the number of unemployed has almost doubled. That is a pretty dreadful state of affairs indeed.

The Opposition makes very clearly and very forcefully the point that the Government has to adopt a new approach, that it has to set about stimulating our economy. The only way in which the economy can be stimulated is by government action. While the Government adopts its present policy of virtual strangulation of the Australian economy, business and industry will not gain the necessary confidence to improve the position. They will not take the risk of employing more people. For that reason it is very important that the Government take the initiative to give that stimulus, to increase the deficit. It could do so, for example, by bringing in an unemployment relief scheme, because between January of this year and the end of this year the Government will spend something of the order of $ 1,000m on unemployment benefits. If the Government were to spend $300m on an unemployment relief scheme the Australian taxpayers, the people who have to foot the bill, would see something in return. They would see the necessary community facilities and public works- both State and Commonwealthimmediately come to fruition. Instead of the money being thrown down the drain it could be used in a far more effective way.

I wish to deal with a couple of other matters. The first relates to an extraordinary thimble and pea trick- the Government’s family allowances. If ever a thimble and pea trick were played on the Australian family man and woman it was done by his Government when it decided to cut out the tax rebate for dependent children and introduce family allowances. The situation is made all the worse by the fact that had the tax rebates for dependent children continued they would have been indexed. Family allowances are not indexed. They are static and will remain static. I will give some examples here and now. The tax rebate for a person with one child would have been $4.80 a week. The child endowment, under Labor, was 50c a week. The cumulative total would have been $5.30 a week. The family allowance for a person with one child is now $3.50 a week, instead of the 50c a week. In other words, had the tax rebate been still operative and had it been indexed as the Government undertook, a person with one child would have been getting $4.80 a week compared with $3.50 a week today- a loss of $1.80 a week. For a second child a person would have received $9.60, compared with the $5 received now. So the comparison goes on.

It is a simple matter of arithmetic. A person who received previously a tax rebate as well as a family allowance- the tax rebate would have been continually indexed- today receives only a fixed family allowance and accordingly is much worse off. I will outline the extent to which the people involved are worse off. A person with one child is $ 1.80 a week worse off; a person with two children is $2.60 a week worse off; a person with three children is $3.40 a week worse off; and a person with four children is $4.45 a week worse off. A person with six children is $5.30 a week worse off. That is why I say it is a thimble and pea trick which the Fraser Government played upon the ordinary family men and women of this country. It made them feel at the time that they were much better off. If they sat down and looked at the matter logically, had their tax rebates for dependent children been indexed as the Government had undertaken to do, they would be far better off than they are today.

I think the House should look at the speech that the right honourable member for Lowe (Sir William McMahon) made yesterday in this Parliament. I mention the speech because he outlined how he got into Cabinet. In referring to a debate in which apparently he maintained he did so well he said:

After that speech I was invited by Sir Robert–

That is Sir Robert Menzies- to join the Cabinet. I had to wait for some weeks, during which time I was informed on a couple of occasions that somebody else might be appointed in my stead. Then I received advice from a Cabinet Minister. I went to Ezra Norton of the Daily Mirror and sought his support.

Mr Holding:

– Was he in the Cabinet?

Mr ARMITAGE:

-Of course not. This gives an example of the outside influences that permeate the Liberal and National Country parties. The right honourable member said:

I went to Ezra Norton of the Daily Mirror and sought his support. Within a couple of days I became a member of the Cabinet.

This is a perfect example of the outside influences which are put on this Government. The right honourable member, instead of going to the Prime Minister and seeking his support or going to other members of his parliamentary party and seeking their support, went to the proprietor of the Daily Mirror and sought his support. Apparently his support was far more important at that time than was the support of the right honourable member’s own colleagues.

Mr Holding:

– He went to the boss.

Mr ARMITAGE:

– The honourable member for Melbourne Ports said: ‘He went to the boss’. Of course, the boss looked after him. I do not know what the payoff was or whether there was any payoff. I have not the slightest doubt that Ezra Norton from that time on was in a position of having some considerable persuasive powers over the right honourable member for Lowe. We can imagine the result of that support when, as the years rolled on, the right honourable member somehow or other- I do not know how- became the Prime Minister of this country.

I raise two other questions with the Government. A deserted wife on a pension receives fringe benefits.

Mr Bourchier:

– She receives what?

Mr ARMITAGE:

– Fringe benefits. The honourable member may now know what fringe benefits are. If he wants to cast aspersions against the womanhood of this country, it is his business. I will not make such assertions. I would not suggest under any circumstances that any deserted wife should go to the honourable member for Bendigo, the Government Whip, for instance. I make the point that the fringe benefits to which I refer are those received from the Department of Social Security, from State departments of transport, from Telecom Australia and so on. As I said, deserted wives on pensions receive fringe benefits, and so they should.

I now ask: Why should deserted husbands not receive the same benefits from the Department of Social Security, from Telecom, from State departments of transport and so on, as deserted wives do? Equally, why is it that no funeral benefit is paid in the case of a recipient of a widow’s pension whereas it is paid, and quite rightly so, to a recipient of an invalid or age pension? Those are two questions that I raise today in this Parliament, and I think that the Government will need to consider them if common justice is to be restored. I refer now to the Government’s taxation policy. In recent times the Treasurer (Mr Howard) has brought in legislation relating to tax avoidance schemes.

Mr Holding:

– Only on some schemes.

Mr ARMITAGE:

– I agree with the honourable member for Melbourne Ports, only on some schemes. That legislation has been used by the

Government to endeavour to indicate to the public that it is prepared to clamp down on tax avoidance. Never before has such a hypocritical attitude been taken by a government. What it amounts to is that the Government is catching the small schemes but is missing the big schemes. For example, the Government’s policy in relation to Norfolk Island, which was announced in the Sydney Morning Herald on 9 May, indicates that Norfolk Island will continue as a tax haven. I spoke in the Parliament on this matter in 1970 and 1971, calling upon the then LiberalCountry Party Government to do something about it. The Government had a great opportunity to move in and do something about the situation, but it has ignored it. Let us consider the legislation the Government has introduced in relation to the averaging of tax for primary producers. It is valid, it is just, that a primary producer whose income varies greatly year by year should be able to average his income for taxation purposes. But it is unjust that a person who is a doctor or a prominent member of the Bar, for instance, a person earning great income and wealth in this country is able to buy a farm, no matter how dilapidated, and then say: ‘I can now average my income in the same way as a primary producer’. That is being done, and it is being done by supporters of the Fraser Government. No wonder it is being done, in view of some of the influences that we see on the Government front bench.

Then we have the ultimate, the question of family trusts. The other day the honourable member for Fremantle (Mr Dawkins) asked whether the Treasurer would legislate against family trusts. The Treasurer gave the extraordinary reply that family trusts did not amount to tax avoidance, they were merely tax minimisation. What is the difference between so-called tax minimisation and tax avoidance? Why is it that the Government will not legislate against these ramps, ramps that are costing thousands of millions of dollars a year in revenue? The ordinary guy has to pay his tax. He cannot get out of it. He has to pay every penny that he owes, but those with wealth can form family trusts, those with wealth can buy a farm and average their income, those with wealth can utilise Norfolk Island as a tax haven and avoid paying taxes. The reason for this is that involved in these swindles of the Australian purse are prominent members of this Government, particularly in relation to family trusts, and I refer to the Prime Minister (Mr Malcolm Fraser), the former Treasurer and now Minister for Industry and Commerce (Mr Lynch), and the Deputy Prime

Minister (Mr Anthony). How can the Government stand up and say that it is trying to overcome tax avoidance schemes when the major members of the Government are avoiding tax at every possible opportunity? The matters that I have outlined are the reasons why I have moved this amendment on behalf of the Opposition.

Mr DEPUTY SPEAKER (Mr Drummond:
FORREST, WESTERN AUSTRALIA

-Is the amendment seconded?

Mr Young:

– Yes.

Sitting suspended from 6 to 8 p.m.

Dr EDWARDS:
Berowra

-The purpose of Supply Bills (Nos 1 and 2) 1978-79 which are before the House is to authorise moneys for the Government for the period of the next financial year pending the passage of the 1978 Budget. The Opposition moved as an amendment to these Bills that the Government does not provide stimulus to the economy and it went on to charge that the Government has deliberately created unemployment in its fight against inflation. That is untrue; indeed, it is a slanderous statement. The true position is that the Government’s policies are directed towards reducing unemployment and restoring growth with stability, to arresting, indeed, the great boost to unemployment which occurred under the previous Labor Administration.

I will come back to that. But I turn to these Bills- as the Treasurer (Mr Howard) pointed out, they do not in themselves give any indication as to the actual shape of the 1978-79 Budget. But what can be said, as was clear from the Appropriation Bills (Nos. 3 and 4) recently before the House, is that the Government has broadly adhered to the spending total proposed in last year’s Budget, and that in the forthcoming 1 978-79 Budget it will stick firmly with the policy of containing government expenditure to a reasonable rate of growth as a central component of the Government’s overall economic policy. This is perhaps a suitable time to review that policy because, as we heard before the suspension of the sitting, given any opportunity the Opposition criticises the policy although it does not come up with any specific, concrete or feasible suggestions as to how it might be changed.

On this particular matter of public spending I think it is important to point out that the Opposition ‘s constant charge that public expenditure policy is too restrictive and, as it would have it, is bringing the economy to ruin is without foundation. At least as to total, the overall picture as shown in the most recent national product and income statistics is this: That during the half year to December last total public spending increased in real terms, that is, allowing for inflation, by some 2.3 per cent as compared with the preceding half year. Public current expenditure in the December quarter itself increased, again in real terms, by some 2.4 per cent to stand in the quarter nearly 5 per cent higher than it was in the December quarter 1976. Public capital spending increased by 2.2 per cent to stand some 4.8 per cent higher than in the December quarter twelve months previously.

Of course these figures embrace spending by the States and local authorities as well as by the Commonwealth. The Labor Opposition always tries to make something of that, implying that the Commonwealth is the miserly villian and the figures to which I have referred are the result of a fortuitous, as it were, expansion of spending by the States. The truth of course is that it has been a specific objective of this Commonwealth Government to contain its expenditure- it will continue to do so- but to foster and to provide the resources to enable increased expenditure and activity by the States. Thus the figures for the various levels of government should be taken together and the almost 5 per cent increase in real terms from the December quarter 1976 to the following December quarter is very relevant.

Thus while we certainly have reined in the mad spending spree of the previous administration which threatened to destroy the whole balance and viability of the Australian economy recall that increase of fully 46 per cent in the one year 1974-75 which, be it noted, was accompanied by the most rapid increase in unemployment ever recorded -

Mr McLean:

– And taxes.

Dr EDWARDS:

-And taxes, nevertheless Government spending has been expanded reasonably in accordance with the national needs of Australia. That is important. This Government will not be sold short. Some people talk as if the Fraser Government is applying a straitjacket to the economy. What has to be understood is this: This Government’s economic policy is tough on inflation- but it is good for Australia, with its whole objective being to restore growth with stability and high levels of employment- the sort of Australia we always knew. The idea that the Labor Opposition tries to project, that the Government’s policy is restrictive to the point that it would put Australia and the Australian economy in a straitjacket is way off the mark. It would put inflation in a straitjacket beat inflation- and that is certainly what we are about. And we are winning; witness the 1.3 per cent increase in the consumer price index for the March quarter. But for Australia, renewed growth, prosperity and high levels of employment are the targets and objectives of the Government’s policies.

Yet taking the economy as of now one is bound to concede that the level of economic activity is more subdued, flat, than we would like. I believe that the majority of the Australian people recognise that what the Government is doing is what has to be done. Albeit we would all like to see conditions more buoyant, the fact is that matters are moving in the right direction. What I believe the Australian people do perceive- this needs to be stressed- is that the situation is an extraordinarily complex one. As I have said on a number of occasions in this Parliament, it has not been an ordinary cyclical variation in economic activity with which we are contending. Rather we are dealing with a situation of continuingalthough, happily, falling- inflation and unemployment, the two things resulting significantly from major elements of imbalance in the economy stemming in large measure from the Whitlam years, and also associated with structural and other factors which are very complex and difficult to remove, offset or change quickly. There are no slick, easy or neat solutions in this situation. The other day the Leader of the Opposition (Mr Hayden) said:

Any government can bring down inflation quickly and by almost any amount it cares to name.

Mr Cohen:

– Finish the quote.

Dr EDWARDS:

– That is where the sentence ends. What an absurd statement. Inflation can easily be increased- as the Government of which the Leader of the Opposition was a member did so successfully- but to reduce it and to restore full employment there are no slick, easy or neat solutions and the Australian people recognise that and will judge the Leader of the Opposition accordingly.

Foremost among those elements of imbalance to which I referred is the so-called real wage overhang, that is, the fact that wages increased way ahead of productivity, which translates- to put it in more straightforward terms- into the very high, the too high, Australian cost structure.

Mr McLean:

– What about real wages?

Dr EDWARDS:

– That goes back to the incomes explosion of 1974 when in one year real wages, as the honourable member points outmoney wages adjusted for prices- increased by more than 10 per cent. That was to roll into one year the sort of increase in real wages, and the standard of living, which would normally accrue only over three, four or more years. In short, wage earners generally from 1974 had three to four years’ normal increase in advance. The impact was on business profitability and on its capacity to employ people. That impact was very great. It resulted in the massive increase in unemployment and the distortion of the Australian cost structure with which we are still wrestling.

In addition to that and related factors there have been at work major structural changes in the economy. I refer, for example, to the slowing of the growth of population which has had important implications for the level of activity in housing and all that implies for other industries dependent on it. Again, in the manufacturing area, it has to be recognised that for most of the post-war period manufacturing grew and prospered on an import replacement basis. But in many areas the limits of development on that basis have been approached. We urgently need a greater export orientation. There can be no return to a buoyant full employment economy without a restoration of manufacturing- so policy has to recognise this fundamental structural aspect. These and other structural factors are very important. Some have put it- I think this overstates the case- that we have come to the end of an era, the post-war era of strong growth fuelled by high level immigration, import replacing manufacturing and the growth of the tertiary sector. That, as I said, overstates the case but it does underline that in all these circumstances policy is extraordinarily complex- much more so than in the past- so that past experience provides only a limited guide to how the Government should proceed.

The last point is underlined in this way. The fact is- the Opposition view refuses to recognise this point- that since the trough of the 1974-75 recession, national output has been growing on average at 3 per cent per annum. The most recent figure for Australian non-farm domestic product puts it at some 7.5 per cent higher than the 1975 trough. I stress that Australian total national production, at the latest count, was some 7.5 per cent up on the 1975 low point to which it was reduced under the Labor Government. That performance is as good or better than the experience in previous downturns in the Australian economy. As another way of looking at it, it is a growth of output that is broadly similar to that which has occurred in other industrial countries during the last several years. But because of the deep seated imbalances in the economy, and the structural difficulties to which I have referred, other factors, especially unemployment, have not moved as we would wish. Unemployment, and especially youth unemployment, remains unacceptably high and the Government is every bit as concerned about that as the Opposition affects to be.

Nevertheless the basic settings of the economy are, as I said, turning in the right direction. We simply have to persevere, there are no quick or easy ways out. The Leader of the Opposition in his speech to which I referred earlier, grievously mislead the Australian people in suggesting that there are easy and simple ways out. First and foremost, of course, inflation has been substantially reduced. The consumer price increase for the March quarter, as I have said, at 1.3 per cent is the lowest for some five years, and involves an inflation rate over the 12 months to that period of 8.2 per cent. That brings inflation down to the Organisation for Economic Co-operation and Development average and there can be little doubt that the underlying inflation rate in Australia is still falling. First and foremost therefore, as we look ahead on policy, the Government must and will maintain the fight against inflation. That is number one. In that fight the key element is to contain the increase in money wages and to achieve partial adjustments to the consumer price index for the time being, for a temporary period. The importance of that goes beyond limiting inflation, it goes to the key problem of correcting the real wage imbalance. The Opposition is vocal in arguing that the partial adjustment of wages to price increases, is a denial of justice. I ask, justice for whom? What about the unemployed? That is what we are doing something about. The key factor is to correct this too-high Australian cost structure.

Next as to stimulus, to which the Opposition refers in its amendment. It moved an amendment saying that the Government policy does not provide stimulus. But it does; there is stimulus or stimuli- plural- built into what we are doing. Firstly, the tax cut which took effect on 1 February involves an increase of some $ 1,000m in disposable income over the next 12 months from that day. Yet the Opposition charges that the policies of the Government are restrictive. Does the Opposition forget what we have done, in the tax reduction and tax reform area, which is undoubtedly and inherently expansionary? Indeed, a tax cut of the same proportionate order proposed by President Carter has been called into question by the Federal Reserve Authority in that country as being too expansionary, perhaps inflationary. That is the first stimulus that is built into the policy.

The second element of major stimulus is to carry through the interest rate reduction which is already under way. The reduction of interest rates is perhaps the most powerful and pervasive stimulus the economy can receive. It has implications, in particular, for the housing- and manufacturing and other industries dependent on that- and consumer durable sectors. I was delighted to see the headline in the business section of the Australian Financial Review the other day saying ‘Optimism is in the air’. It continued: Hopes of cuts in interest’. Also, this headline appeared in The Australian last Friday: Another win in inflation fight- Share market peak shows new optimism. ‘ Optimism is indeed in the air. Truth will come through notwithstanding all the efforts of the Opposition to kill it stone dead.

Next in our policy the Government continues to explore and will enlarge- I stress, is enlarging -as appropriate the various employment incentive schemes it has introduced. Honourable members may recall that apart from items to cover the increases in the award wages of Government employees the largest single item in Appropriation Bill (No. 3) and Appropriation Bill (No. 4) that we passed the other day was the additional $30. 7m to meet increases in payments to employers and employees under the Government ‘s enlarged National Employment and Training Scheme. That is action, not words the true earnest of the Government’s purposes. Next, the implication of what I said earlier is that there are two broad areas of policy with which the Government is concerned in order to restore the type of economy we all were used to. Firstly, overall economic policy, so-called ‘macro’ policy, with the major thrust being to beat inflation and to reduce interest rates, and taxes, and, secondly, more specific policies to deal with structural problems. The macro policy alone is not sufficient. In this second respect. It is of critical importance to continue, and enlarge as appropriate, our export, investment, industrial research and development grants and other incentives. I refer, for example, to the important adjustment assistance area- the incentives to export, the incentives to create improved technology, the incentives to explore and develop new activities in terms of processing minerals and other resources geared to world market possibilities, which are major components of the Government ‘s industry policy.

What this means is that there is a high priority on getting a shift in budget expenditure in the direction of increased industry assistance which has in fact declined very notably in recent years as a component of total budget outlays. That will mean that it will be difficult for the Government to contemplate a deficit in the forthcoming Budget significantly less than for the current financial year. I recognise that the size of the Budget deficit- keeping it down- is seen by investors both in Australia and, perhaps even more importantly overseas as an index of the Government ‘s determination to beat inflation. That determination cannot be questioned. I stress again that for the recent March quarter the consumer price index increased by only 1.3 per cent. That is evidence on the board of the Government’s resolution. What has been important is the way a somewhat higher deficit than originally contemplated has been financed- specifically by the Government’s success in making sales of its securities to the non-bank public- insurance companies, private individuals and so on- who have confidence in the Government’s policies. The Government can confidently anticipate the continued effective financing of a deficit of this order- until in due time the deficit reduces itself, so to speak, as economic activity picks up to stronger growth in the latter part of this year and in 1979 and beyond. I support these Bills and reject the amendment moved by the Opposition.

Mr INNES:
Melbourne

– I would like to say at the outset that the honourable member for Berowra (Dr Edwards) astounds me. He has continued the deception and deceit that was exposed in what the Leader of the Opposition (Mr Hayden) said in his speech to the Sydney Chamber of Commerce at the Wentworth Hotel. The honourable member for Berowra has exchanged his mortarboard for 30 pieces of silver, hawking his capacity as an academic around to the highest bidder.

Dr Edwards:

– That is not true.

Mr INNES:

-It is quite true. The honourable member can be sure about that. I shall enlarge on what I said about deceit and deception. The Prime Minister (Mr Malcolm Fraser) this morning during Question Time went to great lengths to quote one aspect of the speech of the Leader of the Opposition who said that any government can bring in inflation quickly by almost any amount that it cares to name. But the Prime Minister did not go on and quote the next two lines. Mr Hayden went on to say: ‘All that had to be decided was a social and economic cost.’ That is the crunch decision. The Government and all those little puppets on the back bench- incidentally, it is quite clear that the honourable member for Berowra will never make the front bench because he has not made it now so he never will- ignore the major thrust of the argument. According to the thrust of the argument of the Government in its successive submissions to national wage cases, real wages overhang is now running at about 10 per cent. The thrust of it argument supported continuing requests for nil wage indexation flow-on. That means that real wages should be reduced by 10 per cent. That is around $18 a week. Yet over the past two years real wages have been effectively reduced by over $ 1 2 a week. So that is the justice that the honourable member for Berowra speaks about. I shall explain a little later how honourable members on the Government side support taxation dodges that are going on every day of the week on Norfolk Island. I shall refer to the detail in one moment.

I shall refer to another aspect of the policies of the Government. Today we heard the impassioned speech by the Minister for Health (Mr Hunt). The effect of the Budget on those who can ill afford it is seen in that speech. About 800,000 social security recipients, people receiving unemployment and sickness benefits, single parents and many age pensioners will now have to pay doctors who can no longer bulk-bill. This is the result of the attitude of the Government. In the light of this great sacred cow of the market place and its mad bent and tired endeavours to reduce inflation at all costs, who will be the sufferer? Of course, it will be the pensioners. The saving is something like $24m in a total cost of $3,000m which is less than one per cent. That is the amount of money that the Prime Minister has used on VIP aircraft. We have to get our priorities right. So VIP aircraft mean more to the Government than do the recipients of social security benefits who need medical attention and who will be placed in the situation of now having to pay. Now our silent friends on the back benches on the Government side should tell the pensioners in their electorates about this matter.

Mr Roger Johnston:

– You obviously did not understand the speech. Read it first before you talk off the top of your head.

Mr INNES:

– The honourable member would not know. The only speeches that the honourable member for Hotham makes in this place are interjections. He would not know the first thing about the matter. I challenge him to read the speech if he can. If he would like to spend the time a little later I shall explain to him how the pensioners will suffer under the scheme. Other areas are attacked by the policies of the Government because of the philosophy that flows through the Budget strategy. Cruel attacks are made on the young. The unemployment policy has resulted in alarming increases in the young homeless in my electorate. Statistics from Melbourne institutions for homeless men verify this increase. The Salvation Army has taken out figures for the Gill accommodation centre, a traditional Melbourne centre for homeless men. They show an increase of almost 7 per cent in the past year for residents in the 18 to 25 years age group. Eighteen to 25 year olds represent 18.85 per cent of the total population, compared with 1 1.86 per cent in the previous 12-month period. Even more alarming is the fact that, in the breakdown of age groups, the 2 1 to 25 year old group was the second highest of any age group. The highest group, with 12.83 per cent of the population, was the 46 to 50 year olds. The age groups are divided into five year blocks, going up to 60 years and over. The 21 to 25 year old figure is frightening. The second highest group- 11.67 per cent- were in this age block. A staggering 7.18 per cent were 20 years of age and under. This was higher than the group of 56 years and over.

The tragedy of this, of course, is that young girls are forced into prostitution, forced into areas where they cannot hold up their heads, purely and simply to keep a roof over their head. We see the honourable member for Hotham (Mr Roger Johnston) hang his head. He ought to hang his head, because bis Government is responsible for this situation. He sheds crocodile tears in his electorate.

Mr Cohen:

– He is laughing.

Mr INNES:

– In fact, he is laughing, as the honourable member for Robertson has said. The one social trauma to which this massive increase in young homeless can be attributed is the youth unemployment rate. In my electorate where, by its nature the unemployment rate is high anyway, the youth unemployment rate is about 2 1 per cent of the total as at the end of February. At the Collingwood office there were 2,344 registered unemployed and 506 of these were juniors. Junior males and junior females were almost evenly divided at 25 1 and 255 respectively. The number of unemployed young people registered, and the number of unregistered juniors hidden in the community, represents a major social catastrophe. I feel sorry for people who laugh at those sorts of things in the House.

I turn for one moment to an area which I think shows the mad desire of the Government. This is indicative of its attitude in relation to providing facilities for the people it represents, such as private enterprise people, pensioners, the unemployed and others. They are sacrificed at the altar of those who make profits. A serious matter that is causing concern to the Opposition relates to workers employed by the Government, by the

Australian Postal Commission and by the Australian Telecommunications Commission. The honourable member for Bendigo (Mr Bourchier) who is trying to interject can go back and talk to the people in the telecommunications area. There is a growing concern at the encroachment of private enterprise into what has traditionally been a government enterprise responsibility. I believe the legality of many of these encroachments ought to be challenged. The legality of many of these encroachments has never been challenged, because people in the departments have been stood over to see that they do not challenge.

It is a further indictment of the Government that it has failed to prosecute breaches of its own laws. I shall say more about that a little later. I prefer simply to indicate that a further cause of concern among these people is that they can see their traditional service slipping into private hands. This is not a sweeping statement, particularly given developments in the telecommunications area. People who do not see the Government using its laws to prosecute or to at least test possible breaches of the Postal Services Act and the Telecommunications Act are concerned. This is yet another reflection of the Government’s commitment to the sacred rights of free enterprise taking precedence over all, particularly over lucrative areas of public enterprise.

It is common knowledge that the Postal Commission intends to increase postal charges in the next Budget. There will be increased postal charges shortly. There is no doubt about that. The Commission will argue that as it operates on a user-pays basis it must increase the charges to meet consumer price index increases. I happened to read a so-called confidential document that appeared on my desk. It lays out clearly and unequivocally what will happen. However, the Commission’s estimated profitability for the year 1978-79 does not justify these increases. It estimates that its standard letter profit this year will be $8. 8m. It estimates a surplus for almost every service used by the ordinary family person. The major loss will come from registered publications, which it estimates will lose $ 1 3 . 8m. If the user-pays principle is to apply, the rates for this service ought to increase. The user ought to pay. But I do not believe that ordinary household mail users ought to subsidise those who send registered publications. Estimated losses on postal services are almost $5.5m. This would justify increases in those rates. The great danger is that the Commission will make the ordinary user meet the estimated losses. Whilst the Government continues to hand over the more lucrative areas of mail deliveries and telegram deliveries in the metropolitan area, of course the user-pays principle goes down the drain.

Members of the National Country Party, who are conspicuous by their absence tonight, ought to be examining this question very closely. There is not one National Country Party representative in this chamber. If the user-pays principle applies and companies such as Thomas Nationwide Transport and other companies are going to deliver the mail only in the areas where they can rip off the cream, how much will the people in the outlying areas be charged for the same mail services? Where will the money for those services come from? It will not come from the senders of registered mail; it will come from ordinary consumers, such as the people sitting around this chamber tonight, who will pay more for their mail deliveries. If that is not true, I challenge the Minister for Post and Telecommunications to tell us in this House this evening, tomorrow or at some other time that postal charges will not increase.

Mr Bourchier:

– He has already told you once.

Mr INNES:

– No, that was in regard to television licences. I am not sure whether he has been informed. If he is as well informed as some of the front bench members in this House those who have television receivers should not be lulled into a false sense of security. I believe it is more likely that the Telecom commissioners,’ at much inconvenience to themselves, might induce the Government to introduce licences for people who have television sets. So far as the reference to postal charges is concerned, that challenge stands on its own two feet, and the Minister for Post and Telecommunications has a responsibility to answer the challenge.

I turn to another area of deception and deceit by this Government. Recently the Minister for Home Affairs (Mr Ellicott) presented in this House a document relating to Norfolk Island. I stress that I am not challenging him for giving a professional opinion as a Queen’s Counsel. Far be it from me to do that. It happened that the Minister coincidentally gave an opinion to the Norfolk Island Council about the problems associated with taxation laws applying to the Island and some constitutional difficulties involved. Of course when the opinion was given to the Council it thought the opinion was great because it reflected the Council’s opinion. The Council took great heart from the opinion. On the evening the statement was delivered I cited a Mr Foote, an individual who was a resident of Australia with a registered company on Norfolk

Island. He set up a triangular company arrangement between Japan, Hong Kong and Norfolk Island. By manipulation the company on Norfolk Island had a detergent called Swipe manufactured in Hong Kong and distributed by a company in Japan which was the outlet. The money was transferred back to Norfolk Island. Mr Foote of course dodged tax in three countriesJapan, Hong Kong and Australia. Yet government supporters want to put in gaol hapless individuals who for all sorts of reasons have not put in tax returns for three years. I am challenging the Government now to tell us what it is going to do about the individual to whom I have made reference. In a few moments I intend to put another guy in the net.

The Treasurer (Mr Howard) is not in the chamber now. I challenge him to explain why, when the Commissioner of Taxation in Australia decided to investigate tax dodges on Norfolk Island, either he or the Minister for Administrative Services (Senator Withers) vetoed the investigation. This was done immediately prior to the statement being made by the Minister for Home Affairs.

Mr Bourchier:

– Would you speak up a little? I cannot hear you.

Mr INNES:

– If you washed your ears out, you would do better. The next instance of tax evasion to which I should like to refer is in fact a scandal. Ned Kelly had the decency to wear a mask, and Mrs Kelly would not have allowed her children to play with these people. A family in Victoria named Bloom is involved with the Portmans company which is about to take over or has already taken over Buckleys and Nunn Ltd. The company made $1.3m profit which was channelled through Bona Vista Enterprises- something the Queensland people would know all about- to Norfolk Island. This was carried out by one Mr Maher. The money was then disbursed, and the income was offset against the losses. On 3 1 March 1 978 a cheque for $30m on an account with the Commercial Bank of Australia Ltd in Victoria was channelled to Norfolk Island through two trust companies, one of which was called Cascade Charitable Trust, whose beneficiaries are the New South Wales State Cancer Council and the Royal New South Wales Institute for Deaf and Blind Children. Lo and behold, the $30m was drawn out on the same day and transferred to a trust fund. Coincidentally, it had the same beneficiaries in which Mr Bloom had some great interest. I challenge the Treasurer to answer whether there was $30m- I am assured that there was- and, if that is the case, why this matter has not been investigated till now and why steps have not been taken to head off this unbelievable challenge.

Mr Cotter:

– We cut it off in the last legislation.

Mr INNES:

-I will deal with that matter. The honourable member said that the Government has taken steps to eradicate such things. The people who will be affected by this little joke -

Mr Cotter:

– You have not even read it.

Mr INNES:

– Somebody else read it and is quite wrapped up in it. I can assure the honourable member of that. An advertisement appeared in the National Times for the week ending 20 May 1978. It stated:

Do You Pay Too Much Tax?

The Small Business Letter is one of the few journals which regularly reports how to reduce tax.

Every new subscriber receives a free reprint of tax articles which shows:

I shall go through the features in a moment. Mr Maher must have written this or was aided and abetted by some of the people on the other side of the House who are interested. The advertisement continued:

How to legally delay paying tax;

Why trusts are still viable;

How to get all the benefits from internal superannuation in the first few years;

How to make money set aside for long service leave a current tax deduction;

Details of a $6,000 investment which can give a $12,000 immediately provisional tax deduction;

How to avoid death duties;

How to reduce tax through a Hong Kong subsidiary;

How to considerably reduce company tax;

Ways of reducing personal tax; and

Gives names and addresses of people who can implement such schemes.

It is a bit of a joke, is it not? On the one hand there is this great clamour to tighten the belt provided it is only the workers and the pensioners and those on the lowest spoke of the wheel of fortune who tighten the belt. What about the arch criminals who are carrying out the sort of scheme to which I have made reference? There is not one murmur from the back bench now. I challenge the Treasurer to answer why he has not acted and investigated the Portmans situation. Why did he stop the tax investigators going to Norfolk Island? That was vetoed specifically by either the Minister for Administrative Services or the Treasurer himself. That is what the question is all about. Why does he not own up to his responsibilities?

Mr DEPUTY SPEAKER (Mr Martin)Order! The honourable member’s time has expired.

Mr HYDE:
Moore

-I say as gently as I can to the honourable member for Melbourne (Mr Innes) that he is not doing his supporters or the people of Australia any favour by offering easy and false solutions that he knows perfectly well are false. He can make tear-jerking speeches about girls being driven into prostitution and so on.

I remind the honourable member that the present Opposition had three years in office in which to try its policies of continual stimulation. During those three years the Labor Party did much to bring Australia to the brink of disaster. The honourable member supported a Government that tried, in the first two years of its term of office, the sorts of policies that he is advocating now, though it is significant that it drew back from those policies at the end, when it was too late.

Some people are calling for an expansion of government activity in order to stimulate the economy. There is no doubt that an increased public expenditure will, of itself, create more total activity. But if the Government once decides to spend more, it must then ask itself how it will finance that spending. No degree of wishful thinking will make that question go away. No amount of rhetoric will substitute for cold hard figuring. No honest and informed commentator or politician should ignore the question in an effort to make popular noises.

There are three alternatives. The Government could raise additional taxes, it could raise additional loans, or it could resort to an unfunded deficit, that is, print money. Let us look at each of the three alternatives in turn. The simplest solution to the problem would be more tax. It would, in my view, also be the least damaging alternative. However, taxes themselves depress activity. The taxpayers will have less after tax to spend on goods and services of their own choosing, or to invest as they may choose. What the government would be saying is: ‘Look, Mr Taxpayer, we know better than you how to spend your money, we will take it from you and spend it more effectively’. It would be a doctrine that Liberals should at least be expected to justify and it would lie very strangely with the Prime Minister’s promise to return to the taxpayers control over their own incomes.

If the tax chosen were a direct tax it would have the added adverse effect of destroying a little more of the citizen’s motive to get up, get out and raise productivity. If the tax chosen is to be an indirect tax it will have the added disadvantage of adding to the consumer price index and possibly to wages and hence unemployment. The Government could increase expenditure without raising taxes. That is, it could increase the deficit. This deficit might be funded by increased public borrowings, but that would have two serious disadvantages. The Government’s attempts to buy more money from the public must raise interest rates or, in the present climate, prevent them from falling at the rate they otherwise would. Further, it would add to the national debt and detract from the amount of choice available to future governments to tackle future problems.

Finally, the Government might decide to spend more than it either borrows or taxes in the manner of former Treasurer, Jim Cairns. That policy would provide what I believe in the jargon of the trade is called ‘Keynesian stimulus’. It would also be a prescription for another wave of accelerating inflation. Keynes depended for the stimulus he predicted on a falling value of money so that investment was repaid in depreciated dollars, and real wages fell- the so-called money illusion. In these days of indexation of everything the stimulus is likely to be small for any given amount of inflation. The inflation itself can be expected to frighten the devil out of the market place.

I suggest that none of the alternatives look very attractive. The truth of the matter is that the Government’s economic policy is broadly on course. Much to the chagrin of honourable members opposite, there is considerable evidence that says that it is. The Organisation of Economic Co-operation and Development says so quite bluntly. It said:

With inflation only recently into single figures, and the present real wage imbalance, the circumstances are not propitious for a relaxation of demand management.

It continued:

Apart from the obvious point that steadiness in policy should be maintained unless there are overwhelming reasons to change course, there are a number of other reasons for suggesting that maintenance of the present stance is broadly appropriate.

The April Treasury statistics reveal that final demand rose markedly in the December quarter with a resultant run-down in stocks. Stocks cannot go on falling and when they cease run-down, demand will, of necessity, be reflected in increased production as it has in part already. Motor vehicle registrations showed significant expansion in the three months to February. The Statistician expects seasonally adjusted capital expenditure by private business to be 15 per cent higher in the first half of 1978 than in the last half of 1977. Inflation is in single figures and overseas capital is just starting to flow in. The evidence of these statistics is that activity is already starting to advance slowly, but I believe surely. I should like to quote what the organisation SYNTEC had to say:

April has provided new room for optimism about 1979. Whether that can be sustained depends now on the capacity of political government to sustain its restraint course in the face of pressure on several sides to change it.

That pressure is the greatest danger that the nation faces in economic terms at the moment. This is certainly not the time to change policy. Yet we have two groups who want radical changeone group insists that the Fraser Government’s approach to economic management over the past three years has been quite wrong and should be abandoned, while another group insists that the policy has been so successful that it is no longer necessary. Neither group is yet right. All the hard evidence says that the OECD assessment of our position is a correct assessment.

An inflation rate of 7 per cent to 8 per cent per annum is still too high, and the share of company profit is approximately 3 per cent below the long term average and is still too low. The balance of payments, although much stronger, is none the less not strong enough to withstand a substantial fiscal stimulus. Interest rates, though falling, are still high, and overseas confidence in our economic performance is only just starting to be reflected in capital investment in our undoubted opportunities for profitable mineral development. Any sign of weak budgetary control will be reflected in the balance of payments. Foreign investors knowing this and not wishing to be caught by a falling Australian dollar, will inevitably react like startled fawns. The economy has come a long way but it is not yet out of the woods. We know the path, and so long and only so long as we have the political will to stay on the path, will we even have a very fair idea how long it will take to pass the major mile stones.

How often have we seen other Western world nations reach approximately the point at which we now stand, lose their will and snatch defeat when victory was within reach by leaving the path they had chosen? The Heath Government in 1971 stood at a similar position. Urged by his own Party and the Labour Opposition, the unions and the Confederation of British Industry, Heath reflated. The British economy since 1971 speaks volumes on the subject of premature reflation. If we are to stay on the path then we must realistically face its difficulties. The main difficulty will be the Commonwealth’s own Budget.

In order to be credibly consistent with avowed and, I remind honourable members again, successful policy, the Government should achieve a further reduction in the Budget deficit. Last Budget predicted a deficit of $2,2 17m, however for a variety of reasons, that figure will be sub.tantially exceeded. The excess is in part attributable to revenue falling below expectations. Revenue is notoriously hard to estimate and was in this case reduced by the Government’s success in controlling inflation. The excess deficit is also in part attributable to expenditure commitments such as the beef industry assistance costing some $90m to $100m undertaken immediately after the Budget. I can think of no good and sufficient reason for abandoning the detail of the last August Budget so quickly.

Next year the taxpayer will get the benefits of standard rate tax for the whole year. The full year cost of standard rate taxation is $973m- no less! Customs revenue and sales tax cannot be expected to rise substantially. Although predictions for the second half of the year ahead are encouraging, growth of the economy during the first half of the year is anticipated to be only modest. The Government cannot expect increased collections resulting from economic growth to very substantially exceed increased expenditures caused by population growth. In short, simple arithmetic says that the next Budget will be very difficult to write. It will also be crucial.

If the Budget deficit is to be reduced, as it should be, or if it is even to be maintained, the Government is faced with two alternatives: Either of raising further tax income- that is, reversing this year’s tax cuts- or substantially reducing expenditure. Increased taxation would further depress incentive and productivity; so although it would be a much less damaging alternative than that of signalling to the world our inability to control our economic affairs by making no credible reduction in the deficit, taxation increases are not the best way out of our difficulty. Reduced public expenditure is the only sure way of staying on our economic path. Almost everybody favours reduced public expenditure in general terms. However, as soon as people are asked to name specific items they tend to lapse into silence or to name some area which will yield about $10m or even less. The Government needs to reduce expenditure by $500m to $l,000m-preferably nearer to the $ 1 ,000m end of that range- for then the Government may have room to spend a little more on capital works which would in turn stimulate industry.

There is no way that such a sum can be pruned from small items such as legal aid or Aboriginal programs. It can come only from health, education and welfare spending which together make up nearly half of the Budget expenditure. It should not come from the real needs of the poor; so it must come either from those whose incomes are above any reasonable poverty line or from programs which provide non-essentials. By way of example only, let me suggest two possible opportunities: If a very reasonable income test were to be applied to the family allowance, it could save revenues in the order of no less than $500m. If the spouse allowance were abolished for those families that do not care for children or other dependants, $200m to $250m could be saved. In neither case would the poor suffer and the benefits accruing to the economy and hence to the unemployed would be considerable.

I know that any move to reduce benefits will be very unpopular. It always is. However, it is Australia’s future that is at stake and it is the personal futures of many people who will be unemployed if the current opportunities are muffed by a government or a parliament that is too afraid of the criticism of people who do not understand the economic consequences of asking too much in benefits and giving too little in tax. Australia has an assured future if its leaders have the political courage to provide unpopular leadership when that is necessary. I remind any honourable members who aspire to the attribute of leadership that anyone can lead a kid into a lollie shop, but the test of your influence is your ability to lead him out again before he gets sick.

Mr MORRIS:
Shortland

-This debate on Supply Bills (Nos 1 and 2) 1978-79 provides an opportunity for the Parliament to make some examination of the magnitude of the funds being provided by way of interim appropriations for the period 1 July 1978 to 30 November 1978 and of the quality of services provided by the Government to the community in the current financial year. The amount of $3, 844.03 9m being sought in Supply Bill (No. 1) 1978-79 is some 9 per cent greater than that appropriated in Supply Act (No. 1 ) 1977-78. Supply Bill (No. 2) 1978-79 seeks an interim appropriation of $592.41 8m. The total appropriations proposed by both Bills amount to $4,436.457m, which represents an increase of 4 per cent over the similar duo of Supply Acts of 1977-78. As the Treasurer and Acting Minister for Finance (Mr Howard) pointed out in his second reading speech, the funds provided in the Bills before us will be subsumed by the appropriations in the Budget when it is passed later this year.

The Minister emphasised in his second reading speech that the amounts provided in these Bills should not be interpreted as anticipating in any way the amounts that might be included for any particular service in the 1978-79 Budget. It is fair to say, however, that the moneys being provided in Supply Bill (No. 1) and Supply Bill (No. 2) can in many circumstances give a guide to what the general provision for an item may be and of the Government’s intended priorities for 1978-79. Having made those general remarks, I want to deal specifically with the provisions of the Department of Transport and the quality of some of the aviation services for which the Department of Transport has responsibility. For that purpose, I have prepared a table setting out the total funds made available to the main divisions of the Department of Transport in the year just concluding. I have related that to the extension of the amounts provided for those similar divisions and sub-divisions in Supply Bill (No. 1 ) now before us.

These figures show that in division 6SS.1, which deals with salaries and overtime for the Department, there is an increase of $6.634m or 4.6 per cent. The table shows that in division 655.2, which deals with administrative services, there will be a decreased expenditure in cash terms for the year 1978-79 of 0.22 per cent or $126,000. In division 655.3 which deals with other services- I will come to this later- there will be a decrease in expenditure of $ 1.696m or 5.5 per cent in cash terms. Obviously the reduced expenditure is substantially more in real terms. Overall, it would appear in the Supply Bill (No. 1 )- I emphasise that it is possible to make some sort of extension in relation to Supply Bill (No. 1) into the year 1978-79-that there is an increase in the cash amount of $4.8 12m which represents a 2.1 per cent increase on the cash expenditure for last year.

Despite the second reading speech comment of the Acting Minister for Finance that the provisions of the Supply Bills are not to be interpreted as anticipated commitments for 1978-79, 1 want to emphasise that the amounts being appropriated in Supply Bill (No. 1 ) are, in fact, a reasonable guide to the Government’s financial priorities for the coming year. Let us look in detail at the composition of division 655. Sub-division 1 of that division comprises salaries, allowances and overtime. I have pointed out that this provision on a projected 1978-79 basis represents an increase of 4.6 per cent in cash terms but a decided reduction in real terms. This reflects a continuation of the staff ceilings imposed by the Government and a corresponding deterioration in the quality of services provided by the Department of Transport. I will return to deal with the quality of those services and the risks involved a little later. The provision for sub-division 2, administrative services, on an annual basis shows a reduction of 0.22 per cent in cash terms and hence a substantial reduction when expressed in real terms.

I point out for the interest of honourable members that sub-division 2 includes expenditure on travel and subsistence which is important in the servicing of navigational aids and critical safety items such as the provision of fire services at airports; marine maintenance- materials and services; aerodromes and buildings maintenancematerials and services; airways facilities maintenance- materials and services; air transport movable plant maintenance- materials and services; and, finally, meteorological services. The financial provision for sub-division 3 entitled ‘other services ‘ on an annual basis shows the largest reduction of all, that is, 5.5 per cent in cash terms and a severe reduction in real terms, depending upon the inflation rate forecast chosen for 1978-79. This sub-division, amongst other items, includes expenditure for railway fares and freight concessions, a subsidy for Tasmanian Railway passenger services, a contribution to the International Civil Aviation Organisation, the Tasmanian freight equalisation scheme, the air services subsidy, development and maintenance under the aerodrome local ownership plan and, finally, road safety promotion and research. Thus it is clear that the amount of funds being appropriated to the Department of Transport in Supply Bill (No. 1 ) means that the Department will face an almost impossible task in the provision of proper safety services in 1978-79.

This Department has a heavy responsibility to protect the well-being of air travellers by ensuring the maintenance of air safety facilities both on the ground and in the air. However, the Department and its officers can fulfil their tasks only within the limits set by the priority accorded funds for those tasks by this Government and directions given by the Minister for Transport (Mr Nixon). The Minister, in my view, has made hollow claims of his concern for the maintenance of proper and responsible standards of air safety. He is trading and this Government is trading on the past good safety record of the aviation industry in Australia. I have drawn the attention of the

Parliament on a number of occasions to deficiencies in air safety matters and to the Minister’s false claims on the subject. Responsible people throughout the aviation industry are seriously concerned about the deterioration in air safety services that has occurred since 1975. Those people include both operators and trade union leaders in the industry. I say quite firmly that I share their considered concern for the low financial priority accorded air safety services by this Government and the hazards that flow from that low priority.

I remind the Parliament of some of the air safety events that have occurred and relate the response to them by the Minister for Transport. In 1976 he misled the House by claiming that there had been no interruption to the monthly issue of the important airworthiness directive advices. Evidence given later to a Senate committee showed that they had not been issued for some months. Last year he dismissed as a unique accident’ the tragic and near disastrous fire in Qantas Drive at Mascot, which could have resulted in a holocaust inside the airport because of a faulty drainage system. More recently I asked him in this chamber, on 1 1 April 1978, a question in relation to the staffing of the Melbourne flight service centre. I asked:

Has his attention been drawn to departmental advice which describes conditions as being in an ‘operationally hazardous situation’ which could have serious consequences for the Department and the officers involved should an accident occur as a result of an error on the job or should a road accident occur involving officers proceeding to or from work?

I went on to say at the end of that question that a recent departmental study also snowed that a further 1 1 flight service officers should have been appointed to that unit at Tullamarine. I asked the Minister for an assurance that proper standards would be maintained at that centre. The Minister replied, in part, as follows:

If the allegations made by the honourable member are correct, they are quite serious. I shall view them as being serious and take the appropriate action.

The appropriate action, to the best of the knowledge of the Parliament, has been nil. To this date I have received no response from the Minister, either verbal or written. The usual practice when questions are raised in this Parliament in that way is for the Minister to reply in writing as soon as he has the information available. I repeat that I have had no response from the Minister to date, and I interpret that as being evidence of the hollowness of the claim of interest and concern by the Minister. On 14 April the Australian newspaper reported a statement by the manager of the Australian Federation of Air Pilots. The article carried the heading: ‘Air Safety Breakdown! Pilots blame cost cuts for danger’. In that article the Federation was reported as claiming that cost cutting and staff shortages were dangerously eroding air safety standards. The manager of the Federation went on to list items involved and the locations where this was happening. He said, in part:

We used to ask what was necessary for safety and budget accordingly. The Department of Transport now is told what funds are available and has to tailor its spending accordingly.

The article in the Australian newspaper went on to state:

Experience had shown that aircraft accidents were generally caused not by one factor but by an accumulation of carelessness and neglect.

The Minister responded to that serious statement by a major union in the industry in his usual inimitable way, namely, by denying the claims of the Federation and accusing its manager, Mr Coysh, of casting aspersions on fellow members of the Federation and air traffic control personnel. Yet the Minister would have been aware that the latest official figures of his Department show that there is expected to be a shortage of 67 air traffic controllers by the end of this year, given a continuation of normal wastage rates and current training programs. Currently there has been a rapid increase in overtime worked by air traffic controllers. But there is a set limit to the overtime that can be worked, and the only alternative when overtime cannot be worked or when staff is not available is to close down certain positions at major centres at night. At the same time the Department has begun purchasing commercial standard valves for radar replacement equipment in place of the previous military standard valves. The prices are lower but the failure rate is more frequent.

On 26 April 1978 the Professional Radio Employees Institute issued a statement supporting the claims made by the AFAP on 13 April which the Minister had sought to refute. The PREI release- its members service the navigational aids- stated, in part:

Recurring lack of travel funds is often restricting maintenance.

The departmental minute of 13 April, five days before the Minister attacked the pilots, stated:

Owing to funds shortages for freight and financial restrictions for materials, authorised store holdings will be replenished on a limited basis. Replenishment will be made for essential requirements only per media of form 282 raised by the requesting station.

Mr McGrane, the Federal Secretary of the PREI, was reported in the Sydney Sun of 3 May 1 978 as saying that the claims of the AFAP were backed by his organisation. He said that the Minister’s claim that cost cutting is not endangering Australian air safety was false.

I turn now to rescue fire fighting services at airports and their deficiencies. The Department is in the process of reclassifying airports which merit fire protection services under a new formula based on passenger traffic rather than aircraft movements as used by the International Civil Aviation Organisation. The union concerned has asked whether the Department has advised the airlines of its inability to meet ICAO standards in rescue fire fighting at the majority of airports which it staffs with rescue fire fighting services. I would be interested, and I am sure the Parliament would be interested, to learn the answer received from the Department. Then we have the fiasco of the ten rapid intervention fire fighting appliances which were purchased some 12 months ago at a cost of several hundred thousand dollars, but which have not been able to be used yet because, of all things, their engines overheat.

Mr N A Brown:
DIAMOND VALLEY, VICTORIA · LP

– Because of what?

Mr MORRIS:

-The engines get too hot yet they are fire fighting appliances. I believe that the Minister should cease acting as the Prime Minister’s fireman, or Fraser ‘s fireman, for want of a term. He should cease rushing around trying to settle brush-fire disputes in government ranks, such as that involving the resignation of the former Treasurer, the present Minister for Industry and Commerce (Mr Lynch), and the feud with the Queensland Government over the Aurukun and Mornington Island Aboriginal reserves. He should concentrate on his heavy responsibilities in relation to transport. It may be that the Prime Minister has appointed him Special Minister for Political Negotiations’ in Australia.

I have outlined the concern for air safety expressed by those involved in its provision. To that must be added the concern by senior operators in the aviation industry at the heavy loss of key aviation personnel from the Department since the Minister assumed office. Are we to believe that the unions and the industry operators are all dishonest people and that the Minister alone is telling the truth? The matter is too serious to be left to that kind of judgment. The views expressed by the industry employees were backed by the Department in its submission a few weeks ago, to a Senate Estimates Committee when seeking additional funds in Appropriation Bill (No. 3) for essential services. In respect of item 655. 1.02, which was concerned with salaries and overtime, as I mentioned earlier, the Department, in its submission to the Parliament, to the Senate, had this to say:

While all rostered overtime is being restricted to an absolute minimum, heavy commitments are still being incurred in emergency duty overtime due to staff shortages, sickness and the increasing incidence of special jet aircraft movements at non-capital city airports . . .

Furthermore, the maintenance of communication and navigational aid equipment and major installation works are behind schedule because of the unavailability of overtime funds.

In respect of item 655.2.01, travelling and subsistence, the Department referred to ‘essential operational travel commitments required to maintain standards of aviation and marine services to a minimum safe acceptable level’. The Department referred to those commitments as its reason for the requirement of $265,000 additional to the amount which was provided by the Budget. In respect of funding for air transport moveable plant and maintenance- this includes items I have already mentioned, such as the repair and maintenance of departmental aircraft and associated radio equipment, vehicles, aerodrome plant, fire and crash vehicles, including ambulances- the Department said this:

The prolonged effect of limited funds resources has effectively depleted stocks of maintenance spares for departmental vehicles and plant and of necessity has ensured a minimal maintenance program being carried out during that period.

The Department concluded by saying:

Every endeavour has been made to restrict utilisation, and consequently maintenance commitments of aircraft, vehicles and plant to a minimum, but there are certain responsibilities that require the operation of this equipment if services are to remain both functional and safe.

Mr Deputy Speaker, I seek leave of the House- I did obtain it from the Minister who was here earlier- to have incorporated in Hansard those three extracts from the Department’s submission to the Senate Estimates Committee and the table to which I referred earlier.

Leave granted.

The documents read as follows-

Department of Transport

page 2434

ADDITIONAL ESTIMATES 1977-78

Explanatory Notes

Division 655/ 1 /02 Salaries and payments in the nature of salary

Item 02- Overtime

Purpose of Appropriation

This item provides for payment to departmental officers for overtime.

Explanation of Additional Requirement

Overtime commitments are unavoidable in some areas of the Department’s mandatory functions and the airways operations activities are responsible for the major content of the total expenditure.

While all rostered overtime is being restricted to an absolute minimum, heavy commitments are still being incurred in emergency duty overtime due to staff shortages, sickness and the increasing incidence of special jet aircraft movements at non-capital city airports. Officers in operating positions must be on duty during the hours of service and if additional funds are not forthcoming the only alternative remaining will be the closure of airports.

Furthermore, the maintenance of communication and navigational aid equipment and major installation works are behind schedule because of the unavailability of overtime funds.

Consequently, additional overtime funds of $350,000 are required to permit these essential services to continue efficiently and safely.

Department of Transport

page 2435

ADDITIONAL ESTIMATES 1977-78

Explanatory Notes

Division 655/2/01 Administrative and Operational Expenses

Item 0 1 -Travelling and subsistence

Purpose of Appropriation

This item provides for the fares for essential overseas, interstate and intrastate travel and officers’ allowance costs, travel costs associated with departmental sponsored training courses, payments of PSB Regulation 90 (private vehicle use) and meal allowances.

Explanation of Additional Requirement

The additional requirement of $480,000 is attributable to the following factors:

Department of Transport

page 2435

ADDITIONAL ESTIMATES 1977-78

Explanatory Notes

Division 655/2/12 Administrative and Operational Expenses

Item 12- Air transport movable plant- Maintenance

Purpose of Appropriation

This item provides for the repair and maintenance of departmental aircraft and associated radio equipment, vehicles, aerodrome plant, fire and crash vehicles (including ambulances), machine tools, hand tools and workshop equipment and for the procurement of replacement tyres and tubes.

Explanation of Additional Requirement

The prolonged effect of limited funds resources has effectively depleted stocks of maintenance spares for departmental vehicles and plant and of necessity has ensured a minimal maintenance program being carried out during that period. This crisis maintenance policy implementation has now reached the stage where essential equipment is becoming increasingly non-operational and to rectify this position in the short term, additional funds of $100,000 are considered to be absolutely essential.

Every endeavour has been made to restrict utilisation, and consequently maintenance commitments of aircraft, vehicles and plant to a minimum, but there are certain responsibilities that require the operation of this equipment if services are to remain both functional and safe.

Mr MORRIS:

-I thank the Minister and I thank the House. To this must be added the effect of this loss of just over 1,000 personnel from the

Civil Aviation Division of the Department of Transport since December 1975. I shall read from a departmental letter which was written a few weeks ago, and which is over the signature of L. E. Power, for the First Assistant Secretary, Airways Operations. The letter refers to the collection of passenger statistics at airports and the difficulty involved in that process. It puts forward a reason for the difficulty in getting those statistics.

In order to conserve the effort involved in this and considering that the particular pan of the Department involved has, in the process of the move to Canberra, lost a big proportion of its staff, the most limited number of airports necessary to make appropriate judgments was examined.

In other words, the Department picked out some airports and developed statistics on them. The Department did not have enough people in the relevant section anyway to carry out the study properly, so it said: ‘Please accept what we are giving you’. I am trying to reinforce what has been said by the aviation industry operators and by the unions involved. When staff numbers and funds are reduced, accordingly the quality of service and the standard of safety are reduced. I sincerely believe that the standard of safety has deteriorated. I have formed that judgment in the light of the information provided to me by all the people in the industry with whom I have talked over the past two years.

The next step is to close certain airports. From time to time we have heard in this House Dorothy Dix questions about the operations of Devonport and Wynyard airports in Tasmania and about which airport will close. Again I quote from the same letter. It states:

The forecasts used in the plan -

This is the activity plan and the forecast development plan for the Department-

Adopt a slightly lower growth rate for Devonport than Wynyard but from the higher 1970 figure, hence, despite the current situation, the 1982 figures for Devonport indicate a slightly higher level of activity.

Then comes the punch line:

As indicated at our recent meeting the relative position of these two airports in 1982 - just on four years a way- is a matter of some uncertainty, as is the fact that they will achieve a growth rate or, as at present, continue to decline.

Irrespective of the statements that have been made by the Minister and irrespective of the politicking and the claims made by the members of this chamber who represent Tasmania, all of whom are absent, the fact is that the Department is considering the closure of either Wynyard or

Devonport. I have quoted from an official departmental document, a letter to one of the parties concerned.

Mr N A Brown:
DIAMOND VALLEY, VICTORIA · LP

– To whom was that letter addressed?

Mr MORRIS:

-I will explain that to the honourable member later. He is welcome to look at the letter. The Opposition puts the view to the Parliament and to the nation that the stringency of Government policy which is hurting the people who can least afford to cope is also causing the standards of aviation safety and aviation services to suffer. Here, we are trading dollars for danger. It is as simple as that.

Aviation services have a wonderful record in this country. The record is linked to our favourable climate. We should not endanger the standards of safety under the pretext of saving money in order to purchase two Boeing 727s at a cost of $40m for the lavish travel overseas by our international tourist Prime Minister (Mr Malcolm Fraser). I support the amendment that has been moved by the Opposition, because I believe it properly reflects the attitude of this Government to the community. The Government has failed to provide a stimulus to the economy. It is concerned only with benefiting those who support it. Its thesis is simply this: To those who have, more should be given; from those who have not, more should be taken.

Mr DEPUTY SPEAKER (Mr Martin)Order! The honourable member’s time has expired.

Mr GRAHAM:
North Sydney

-I shall not follow the honourable member for Shortland (Mr Morris) who took us away from the main train of debate on the national economy to deal with the subject of transport, an area for which he is the Opposition’s shadow Minister. Whilst I do not criticise him for doing that, I simply point out that in the circumstances it is not possible for me to follow the speech that he made as I wish to return to the other significantly issues that were raised in the debate previously. The only comment I make about the honourable member for Shortland is that it is a great pity that he spoilt his speech by the reference at the end to the purchase at some future time- when someone discovers some suitable models- of a couple of Boeing aircraft for travel overseas by Australian Prime Ministers and important people.

As we have been told earlier, Supply Bill (No. 1) and Supply Bill (No. 2) provide funds for maintaining the services of the Government from 1 July 1 978 to 30 November 1 978. As is the general practice, it is expected that the Appropriation Bills, which form part of the Budget which we all hope and pray will be introduced in the middle of August this year, will have been enacted by 30 November 1978. The sums of money involved are, of course, enormous. In terms of recent history that is not surprising. An amount of $3, 844m is provided for the ordinary annual services of the Government. This is 9 per cent greater than the amount provided in Supply Act (No. 1) of 12 months ago. In introducing Supply Bill (No. 1 ) the Treasurer (Mr Howard) said:

I wish to emphasise that the Supply Bills are not to be interpreted as in any way anticipating what amounts might be included for any particular service in the 1 978-79 Budget. The provisions in these Bills are based wholly on current expenditure levels and have no regard whatever to policy decisions to be taken in the context of next year’s Budget. When the Budget is passed - that will be towards the end of November- the appropriations in the Bills will be subsumed by the appropriations in the Appropriation Act (No. 1) 1978-79.

One could regard that as an exercise in semantics. The fact is that a great deal of information is contained in explanatory notes about the sums of money which have been appropriated at present. I think that my colleagues the honourable member for Moore (Mr Hyde) and the honourable member for Berowra (Dr Edwards) made it quite clear that Australia’s economic problems are manifested in these enormous sums of money. Although they may have no particular reference to policies, undoubtedly in total they represent significant sums of money for the Australian people.

I want to make some reference, for the benefit of my friends in the Opposition who have been creating some misery here this evening, to bulletin 295 of the Australian Industries Development Association which all members will have received today. The opening comment is worthy of record. It states:

It is almost comforting to record that, in the Australian economy at the moment, 93 per cent of those who claim a desire to work are able in fact to find it. In view of the complex range of skills, aptitudes, attitudes, locations and other characteristics in respect of which meaningful employment is required, the recent performance of the Australian labour market deserves perhaps more credit than many would give it.

I think that is a fair and reasonable statement having regard to what has been said by people in the Opposition here tonight.

Mr Bryant:

-Who said that?

Mr GRAHAM:

– The Australian Industries Development Association, a body well known to the honourable member, a body which is interested in establishing the facts in the Australian economy.

I want to turn to a particular aspect of recent times and to consider some of the foreign policy developments, their trends for the future and how they may affect our economy. I point out that if these aspects of the future are considered they may give us some reason for concern. As my colleague the honourable member for Wills (Mr Bryant) would know, although the impact of the closing down of the war in Vietnam in 1972 may have been greeted with relief by many people, it must have had a considerable economic impact upon South East Asia. Undoubtedly it had an impact upon the Association of South East Asian Nations. At about that time there was a change of government in Australia. Within six months of the change of government in this country in 1972, the Government led by the then Prime Minister Mr Whitlam had reduced tariffs across the board by 25 per cent. I wonder whether those circumstances, which have led correspondingly to increased pressure from the countries in the ASEAN group to seek an increased allocation for their imports into the Australian economy, can be identified as being associated at that time with the decision of the Australian Government. I do not think that any of my friends opposite would question the fact that the 48,000 people who went out of employment in the textile industry so quickly over a period of 12 months went out as a result of the decision made by the Whitlam Government. After all, it was as a result of an Industries Assistance Commission report in which the precise figures were quoted that the Government gave consideration to the matter and arrived at its conclusion.

The fact is that, as the years go on and technical capacity increases, from within the ASEAN group in our own region will come greatly increased pressure upon Australia to open up the Australian economy for the goods produced in those countries. As all honourable members know, they are produced at levels that are considerably less costly than corresponding levels in this country, and I refer also to Japan in that respect. I believe that the Australian economy will have to become far more efficient. It will have to face up to the fact that if we are to trade substantially within the Pacific area and the South East Asian region we will have to accept an ever increasing number of imports from those countries. With our present high cost levels it seems to me quite inconsistent to ignore those facts, and to be seeking continually to increase costs in Australia on a basis of humanity and justice. The reality is that Australia will have to face the facts of the future, and in my judgment we are going to find it very difficult over the next decade.

It seems to me that, as has been said by my colleagues and friends the learned honourable member for Berowra and the honourable member for Moore, the Government must adhere to its present policies. Those policies are consistent with the statements made only a few years ago by the leaders of the Labor Party. What was said in Adelaide by the then Prime Minister was true. Every man’s pay rise is another man’s job. We heard the former distinguished and popular Treasurer, the former member for Melbourne Ports, repeating that if an increase were put into the economy by the arbitration system then the impact would be upon those who were already unemployed and who were seeking further employment. Again he said that one man’s pay rise is another man’s job. You cannot have your cake and eat it too. If there is veracity, if there is validity, in what was said by Mr Whitlam and Mr Crean, then it ought to be recognised by both sides of the House. We should try to understand that our policies will have to be considered in relation to rising costs and to the pressures that will be forthcoming from our own region.

The facts that have been put forward by the Australian Industries Development Association over a long period, and they are well known to all members of the House, indicate that employment has grown slowly in the 1970s, especially in the last three years. Despite equal pay and the decline of some female labour intensive industries, the proportion of females in total employment has advanced throughout the 1970s. That is an interesting fact because one would have thought that the greatly increased cost of female employment would have had an adverse effect upon that employment. Government employment surges ahead even now, despite official indications of public sector restraint. Private employment, especially in manufacturing, continues to decline and it remains difficult to identify any clear private growth industries. That must be true because, if there is going to be advancement within the nations that constitute our region, if there is going to be advancement in the economies of the People’s Republic of China, Japan, the Philippines, and those other countries to which I have referred, it will be in the manufacturing area. It is in the manufacturing area, where their costs are so much lower, that they are going to provide intense competition for us. In those circumstances, it seems clear to me that our road for the future will be difficult and that the Government will find it necessary to adhere to its existing policies. I understood from the Deputy Whip that arrangements were being made for me to share some time with another speaker.

Mr Bryant:

– He has vanished.

Mr GRAHAM:

– Invited by my colleague from Wills, I ask him to deal with some of these matters when he speaks because I know that he has had a great deal of experience in Asia. I well recall that when his own Party was in government or about to go into government he formed some very definite views about what was happening in the military sense in the Indo-Chinese peninsula. He got himself into some political bother with some of his colleagues because of his robust and very intelligent contribution to the public debate at that time.

As honourable members on this side of the House have said, we ran into our great problem in the 1973-74 year. It was at that time that real wages were given such an enormous boost, albeit with sincerity, by the socialist government that had come into power. It was done in such a way, and I quote from my recollections of the first Treasurer’s speech that I heard while sitting on the other side of the House, as to transfer assets from the private sector to the public sector. There was then an enormous increase in government expenditure, and it was stated that the standards for the civil service ought to be put to a level that would be pace-setting. The previous Prime Minister was very fond of phrases such as that, and he was talking about setting the pace. There was never any reference to the cost, and the cost always has to be seen as the cost to be borne by the people of Australia. Although one can see some justice in the comment that the present Government has been in power since 1975 and that it is well into the third calendar year since then, the fact remains that the great harm done to the Australian economy was in fact done from the end of 1972 to the end of 1975. The truth of the matter is that it takes a great deal more time to build up an economy, which is always sensitive and always fragile, when it has been struck the sorts of violent blows that were struck in those years. I have never believed that those things were done with deliberation. I believe that they were done simply because it was felt that there ought to be a great increase in expenditure, that the country was so wealthy it could face all sorts of problems and deal with them all at once. I believe that all of those things were felt with sincerity by the Opposition party when it was in government. But the truth is that the effects of its policies were as I have just stated.

I have no doubt that within these next two Budgets the Australian Government will have to retain the firm hand that it has been exerting upon the Australian economy in recent years. Any tendency to relax that firm control would be disastrous for Australia and would lead to the emergence once again of inflation which, if it is properly understood, is simply another form of taxation upon all the assets of the people of the nation, which have been acquired after a lifetime of work. I believe it would be a tragedy for people who spent a lifetime earning the right to superannuation pensions, earning the right to accumulate their assets and owning their own homes to see a situation in which the value of the currency and their assets is so diminished that in fact at the end of their lives they finish with a greatly reduced result from the efforts they put forward during a lifetime. This is the tragedy of believing that one can have his cake and eat it too. The reality is that one cannot do that. As I think one of those gentlemen with a tendency towards the shek phrases said, there is no such thing as a free dinner. The fact is that it can always be had at someone else ‘s expense.

In this country, in this context and in this region if one looks around at the millions of people who surround us, I give the warning that we are the wealthy people who will be expected to carry a far greater degree of the burden in the future. Four thousand million mouths are opening and shutting on this earth tonight and it is popular knowledge that within 25 to 30 years 8,000 million mouths will be opening and shutting on this earth. The World Health Organisation is not an organisation that would be sneered at by the honourable member for Wills (Mr Bryant) and I recommend that he study its predictions for the turn of this century and to bear in mind that 14 million people living as we are on this continent with the great assets that there are to be developed here in minerals, including uranium and oil and in development to take place, we will need every effort that can be put forward by our small population to develop our great and mighty country. If we do not prove to be worthy of our heritage there will be great misery ahead for us because we will be expected to carry at least a fair share of the burden of the miseries of the underdeveloped world which surrounds us to the north and the west.

It is not the easiest picture to look to in the future but it will be dealt with properly only if it is done with sagacity, responsibility and courage. I put it to honourable members that by ‘courage’ in the political sense I mean the courage of acceptance of political unpopularity. If there is one government that has done this in recent times surely it is the Government that we sit behind tonight. I take the view that that Government should be supported.

Mr DEPUTY SPEAKER:

- (Hon. Ian Robinson)- Order! The honourable member’s time has expired.

Mr BRYANT:
Wills

-The honourable member for North Sydney (Mr Graham) always manages to bring an air of objectivity into his statements in this place, but when one examines them, of course, they carry no more weight in regard to the situation of the world at large, and Australia in particular, than statements of the other spokesmen on that side.

Mr N A Brown:
DIAMOND VALLEY, VICTORIA · LP

– He was praising you.

Mr BRYANT:

– That is reasonable enough; so he ought to. Let us just take the theme of the last few minutes of his speech. I will be brief. He talked about Australia ‘s wealth. It is true that per capita we probably have more wealth at our disposal than any other country in the world. Yet this Government over the last two and a half years has taken every possible step to run down its capacity to take on hand those duties which the honourable member said we ought to accept for the rest of the world. How can we help feed the hungry people if we are starting to slow down government activity in this country, which is the basis of so much of the infrastructure upon which we build our industry? How can we carry out our duty if we leave the wealth lying idle? The wealth is not only in the machines but also in the people. There are half a million people idle who would like to be working.

I listened to the honourable member for Moore (Mr Hyde) to whom I always listen with a great deal of interest. I know of nobody who can bring into a speech in this House, particularly when he is dealing with the economy, a more ritualistic approach. I jotted down a few of his comments as he spoke. He seems to represent Stonehenge here. He seems to be solid, steady, in place, immobile, inert and not terribly productive, just producing some piece of idolatry. So here we have it. It seems to me that at the moment we are like somebody locked in a supermarket over a weekend. There it all is. The shelves are stocked with everything that that person needs to live but he practically dies of starvation because he cannot work the cash register. That is what this Government is doing.

It was handed an economy which had some points of weakness. Unemployment was higher than was desirable, inflation was higher than desirable, but there were areas of strength that made it one of the strongest economies in the world. Exports were much higher than imports, our overseas reserves were high, the average weekly earnings of Australians were amongst the highest in the world and Australians could buy more for their average weekly earnings at that time at the end of 1975 than they could almost anywhere else in the world and certainly more than at any other stage in Australian history. I ask honourable members to simply do some arithmetic relating to the cost of things that people need and their earnings. So this continual nonsense has been poured upon the efforts of the Labor Government which changed Australia for the better. I am tired of listening to the jargon about market places, consumer confidence and so on. My friends opposite seem to be living in the past. They are qualified to be members of the flat earth society when it comes to the modern society. This is a period of total change, absolute change. As my friend from North Sydney pointed out about the people to our north, we have to change our whole attitudes and those attitudes are changing. In fact even the honourable member’s attitude has changed in part. For instance, the attitude to China of honourable members opposite has changed dramatically in the last three or four years.

This debate is not just about the economy. It is about Supply Bills (Nos 1 and 2) 1978-79 and is about the way the country is run. My friend from Shortland (Mr Morris) was correct in taking an area of government policy and examining it. I propose to do the same on a matter which has now been taken up by the world at large in New York this week. A few weeks ago the Opposition attempted to move in this House a motion of public importance on the question of disarmament. We were disappointed that the Government had taken no steps towards telling us what it would do about the disarmament conference beginning in New York this week- in fact I think it started yesterday- and which will continue for six weeks or seven weeks. It is a most dramatic exercise by the United Nations. This evening I will ask the Parliament to attend to the general question of disarmament and to encourage the Minister for Foreign Affairs (Mr Peacock) when he goes to New York to take a more dramatic and more positive stance on what I think is one of the great needs of this time.

It is true that everything we talk about here is important, that the poverty of the people to the north is a serious disability to the world, that the hunger is distressing and disastrous, that disease is rampant in places where it ought not to be, that we ought to expand trade, that inflation is a problem and that unemployment is a problem. But they all pale into insignificance compared with the threat to the world and to the continuance of humanity by the great arms race which continues, despite the change in the world at large. So we have to ask ourselves before we start to try to convince other people to disarm and to bring arms under control: Why arms? Why are people arming themselves so heavily now when in fact the threats of war are receding and everybody says so? The Government looks for arms for national security. There is a vested interest in arms production and that vested interest belongs to several groups of people. There are the people who work in the Services. In Australia, for instance, 70,000 people work full time in the Services. Their families are concerned and so are the communities such as Seymour in Victoria, and Rockhampton and Townsville in northern Australia. There is a whole industrial base and also national pride and the aggrandisement to which governments have often been prone in the past. But what is the score now? The foreseeable future does not hold the threat of global war. Optimistically I think we can say that a big war is unlikely. It is improbable that the Russians will attack the Americans or that the Americans will attack the Russians. What advantage would they get even if they won? They would both inherit deserts, they would both be impoverished, and any people who were left would be miserable and very difficult to control. I do not believe that there is a real threat of war between the big nations any longer. But I am pessimistic enough to see in the events in Zaire, in the Horn of Africa, in various things that are happening between Cambodia and Vietnam, threats to humanity, threats that may possibly grow into threats to the rest of us.

I believe that the arms trade is the generator of all those threats. If the world arms merchants did not supply the arms, that could not continue. I make this plea tonight: That we do something more dramatic at the United Nations over the next five weeks. It is a unique opportunity. There are things we should look at and consider. The matter ought to be debated at length in this House. The Minister for Foreign Affairs did make a statement here but we did not have a chance to debate it. Every one of us is concerned with it so tonight I take this opportunity in this discussion on the Supply Bills to raise the general question of our aims in this regard.

There ought to be some general international techniques developed. We have to encourage the arms traders, the nations which trade in arms, to stop supplying them to the nations which are now killing one another. How long could the war and conflict in the Middle East go on at its present scale if the governments of Russia and the United States of America cut off the arms supply? One thing that baffles me about the President of the United States of America- and there is a great deal of humanity in what he has said and in the objectives that he has promulgatedis the decision that he has just made to supply incredibly powerful weapons to both sides in the conflict. How can anybody of logic believe in that? He has also decided, through the voice of Vice-President Mondale, to supply war planes to Indonesia, our nearest neighbour.

I am optimistic enough to think that it is possible to start to slow down this whole system, that there are echoes from the past which tell us that that can be done. I am suggesting that we should be pressuring governments in surrounding areas to create demilitarised zones as big as possible and as effective as possible- places with no barracks, no fortifications and no military establishments. We may well be a little cynical about the possibility of that occurring if it were not for the facts of history. Back in 1817, going on to 1822, the British Government and the Canadian Government were in serious difficulties with one another over on the Great Lakes area. We forget this part of history, but in that period Canada and the United States were threatened by war. What prevented the war developing? Not the fact that they had a common race, a common language and common interests and background but the total scrapping of fortifications along the line of the frontier. That was organised by the Foreign Secretary of Britain at the time, Lord Castlereagh. The historians of that century attributed the peace achieved along those frontiers to that fact. They are not the only such occurrences; there are other instances. In 1905, with the separation of Sweden and Norway into two countries, the Karlstad Convention established a demilitarised zone of 20 miles across, 10 miles on each side of the frontier, and 200 miles long and that has been in force ever since. In 1922, under the Treaty of Lausanne between Greece and Turkey, a demilitarised zone of 60 kilometres, 30 on each side, was established. Our own Antarctic Treaty was established in 1 959.

Who are the villains of the piece? I do not think we can say this too strongly: They are the arms traders. The great arms traders, of course, are the United States of America, the Union of Soviet Socialist Republics, Britain and France. The involvement of other countries is minute in comparison. Czechoslovakia on occasions has exported a good deal and so has the Federal Republic of Germany, but compared with the great arms manufacturers they are small fry indeed. Of these four countries, the USSR exported about 33.4 per cent of the arms exported to the Third World countries; the USA 31 per cent; the United Kingdom 15 per cent; and France 9 per cent. If those countries desisted from that dreadful trade they would be contributing a great deal to the creation of a world of peace.

What should we be doing in our own area? Again, this is one of those points which are very difficult to discuss at any other time. When the Minister for Defence (Mr Killen) made his statement about the tactical fighter force there was no opportunity for most of us on this side of the House or in any part of the House to debate the matter. We are presently considering the reequipment of the Royal Australian Air Force with very expensive, very sophisticated, very powerful but I think totally irrelevant fighter aircraft.

Who are our neighbours? One is Indonesia. I have no time for the Government of Indonesia. I have hopes for Indonesia in the future to continue on the path of peace and to become a good neighbour to all of us but there is no doubt that it has been a bad neighbour to the Timorese people. Its activities in Irian Jaya are no better. We have Indonesia, Malaysia, Singapore, Papua New Guinea, the islands around to our east, and New Zealand. What we should be doing is initiating an attitude that no arms race shall occur here. The thought of an arms race is quite ridiculous when one considers the history of this country and this region and considers the foreseeable future. In 1939 about 8,000 or 9,000 people were engaged in regular service. There was a threat of war from Japan and war developing in Europe. In 1 978, when there is no threat of war, we have 70,000 people in the armed services and we are expanding our capacity to fight and fire. I think it is time that we stopped and took a good look at the whole system. The things that Australia can do are these: We can start to discourage the great nations who are now the arms suppliers from continuing to supply arms. We should be mobilising all those nations which are similar to ours- there are probably 40 or 50 of them, some of them with dictators at the helm, some of them with democratic governmentsand we should be using every pressure upon those nations to stop the arms trade. In our own area we should be concentrating on attempting to create an area of peace and good order.

There is no doubt- and a great body of world opinion now accepts this-that the arms race is the greatest threat to the security of the world. The people who participate in it will be looked upon as the villians of this period of history. I ask the House to apply itself to this question much more thoroughly than it has been doing. We have to reach the stage where we neither sell arms to other people nor buy arms from them. I think we have to reduce the hostility of the general approach to Russia. Russia was on our side in two world wars. I do not think much of the way in which Russia is governed or of some of the antics of its Government and some of the more terrible things that it does, but I have been to Russia and I know many Russians. They yearn for peace just as we do; they are probably in the same situation as the rest of the world. They have an enormous commitment to manufacture arms and they do not quite know how to stop. We have to attempt to get the Americans and the Russians out of bases in the Indian Ocean or to prevent them from establishing themselves there.

There are signs of hope. The formation of the European Economic Community is a very hopeful sign. Little as I was in World War I, I belong to the generation which saw the world committed to destroying itself by the conflicts between basically the French and the Germans in Europe. Those barriers have now fallen down and the countries have formed a community among themselves. But I think one of the greatest signs of hope around the country is the total change in the attitude to China. Six or seven years ago- m fact, up until five years agohonourable members on the Government side would not even recognise the existence of China. Now, every one of them is visiting that country if possible. The Prime Minister (Mr Malcolm Fraser) goes; the Deputy Leader of the Liberal Party goes; others go. We are all keen to be friends with China. If a long-held attitude to a country such as China can change as dramatically as that, we can change our attitudes to the rest of the world by applying ourselves to these matters.

I hope that we will do something more dramatic about this disarmament conference than appears to be the case at the moment. Why is no Opposition representative going? I understand that the Prime Minister is likely to turn up. I know that the Minister is going. There will be a delegation of officials of some tonnage. Why will there be no representative of the Opposition? I think it is important that the people of the world see that on this matter- diffident and inhibited as I think the approach of the Government is- there is a bipartisan approach. None of us on this continent is committed to aggression. I suppose this country has been involved in wars as much as other countries. One can visit the Australian War Memorial and see written on the walls the names of one hundred thousand-odd Australians who have died on battlefields. But after the battles were over men came home. In many respects in the fields of imperialism and militarism, I suppose we could claim to be close to being cleanskins. We could be part of the mobilisation system of world opinion to try to break these barriers.

What on earth do the people around the Indian Ocean want so many arms for? Around the Indian Ocean area we are the wealthiest people I suppose, with South Africa being the next. But this area also has some of the most poverty stricken people in the world such as in Bangladesh, India and Pakistan. When I look at the figures for expenditure on arms in Pakistan I am shocked and amazed at the state to which the country has come. I am asking that we take to the United Nations a total commitment to continue to fight- if that is not a contradictory use of the word- for disarmament and arms control. We should try to let people see that a common-sense approach to the modern world does not require the re-equipment of armies and the fantastic expenditure and intellectual energy that goes into the arms race. I hope that at some stage before the House adjourns the Minister will come into the chamber and make a statement of exactly what he proposes to do.

Before I sit down I repeat the remarks with which I began this speech in response to honourable members on the Government side. The burning issue in this country is the way it is run economically. I know there is a serious conflict of view between honourable members on the Government side and ourselves. I think they belong to the past. They fail to recognise the pattern of change that is occurring. I represent one of the great industrial areas of Australia. I know that there is no future for full employment in the manufacturing industry unless the biggest customer of all- that is governments- get into the business. It is absolute nonsense to reduce public expenditure and government activity at a time when there are great social and other constructive needs in the community, and when the only customer- that is the Government- is getting out of the business. I can not understand how honourable members on the Government side can swallow so enthusiastically and then regurgitate in speeches here, the outmoded theories of the last 30 years.

Mr DEPUTY SPEAKER:

- (Hon. Ian Robinson)- Order! The honourable member’s time has expired.

Mr LUSHER:
Hume

-Supply Bill (No. 1) seeks to appropriate $6,751,000 for the Parliament, of which $1,494,000 covers supply for the House of Representatives. I am a member of the House of Representatives and I had no idea what was going on in relation to supply or, for that matter, in relation to any appropriation or supply Bills in the four years I have been a member. In this case, I learned what the financing arrangements for the House of Representatives were on 10 May. Any day now the Government will begin the final round of negotiations leading up to the 1978-79 Budget which will be delivered in August. As in previous years I will find out on the evening of the second Tuesday in August how much has been appropriated for the purposes of the Parliament and for my own chamber the House of Representatives.

I do not say this in any sense that may be critical of the Fraser Government. This situation has been going on for years. I do not know how far has back it started. I do not blame the Government or any government. I blame the Parliament itself. In the beginning, all power lay with the Parliament. The Parliament elected an Executive. Progressively and steadily over a period of seventy-seven years it has handed over more and more of its authority to that executive, to the bureaucracy, or to statutory authorities and corporations so that the Parliament has effectively divested itself of power. The Parliament has allowed this to happen not so much because of confrontation between the Parliament and the Executive but rather because of adherence to the Party system within the Parliament. Under the Party system it is virtually impossible for private members to prevail over the Party leadershipthe Executive- no matter which Party is in power. The only sanction the Party Room or the Caucus has is to bring its own Government down on the floor of the Parliament. Members would agree that the issue would need to be a serious one for the Government back bench to bring down its own Government.

So the process has been a gradual one resulting in the transfer of power away from the Parliament and into the hands of the Executive. Obviously, such a process is in the interests of the Executive. No executive would want the Parliament to be more powerful than necessary. Some executives would want the Parliament to be as weak as possible. The history of the first seventyseven years of the Federal Parliament in Australia is quite dismal from a parliamentary point of view. I cannot help feeling that if the process of gradual attrition is not arrested and reversed, the people of Australia will rightly question the usefulness of parliamentarians. If the attrition continues there will be less and less justification for the Parliament. Following each election the majority Party elects its leadership and following the accepted processes, the Ministry is sworn in. From that time, for the duration of the Parliament, the power is exercised by the Ministry. Although the back bench participates in the process to a greater or lesser degree depending on the particular issue, this is done outside the Parliamentary chamber and once legislation comes into the Parliament, the Party line invariably holds firm. Given a majority in both Houses, a reasonable government has nothing to fear.

The most important power which nominally belongs to the Parliament is the one which is perhaps the least exercisable. The Parliament has no role in the formulation of the Budget. It is presented with a fait accompli which it accepts or rejects. Rejection is not a real option unless the governing Party wishes to switch to the Opposition benches. The Budget formulation process is a long one starting with first bids in April and culminating in the presentation of the Budget in August. At no stage is the Parliament involved. The Budget debate itself has traditionally been a catch-all debate in which honourable members may speak on any subject. It is rare for members to use the Budget debate as a vehicle to defend the rights of the Parliament.

I personally object strongly to the way in which the estimates for the Parliament itself are handled. I believe the estimates ought to be brought into the Parliament for debate and nonparty amendment during the Autumn session, and whatever is decided upon in that debate should be sent to the Government by the Speaker as a part of the Budget not to be the subject of alteration during the Budget Cabinet processes. This building itself, the facilities available or not available to honourable members, the committees of the Parliament and their staffing, the Library and the service it provides, and so many other matters are all of vital importance to members of the Parliament, and yet we make no contribution to the process. I believe the Parliament needs to take a stand in an effort to regain some of the power that has been whittled away over the years. I do not want the Parliament to become an executive chamber, but I believe it ought to be allowed to exercise its scrutiny function in a meaningful fashion and to make a contribution to Government.

The Parliament should not be simply a tool of the Executive. It should be able to question the use of executive power and seek justification for decisions made by the Government, or the bureaucracy inside or outside the Parliament. John Stewart Mill said: ‘The proper office of Parliament is to watch and control the Parliament, to throw the light of publicity on its acts, to compel a full exposition and justification of all of them, which anyone considers questionable, to censure them if found to merit condemnation.’ It is difficult for a Parliament to properly carry out such functions if the Executive and the bureaucracy effectively control our funding and particularly the funding of our committee structure.

There is always difficulty in obtaining the appropriate secretariat staffing for the committees of the Parliament. My experience has been that committees labour on with inadequate staffing and without expert advice which must limit the range, if not the depth, of inquiries that committees can undertake. Occasionally, as with the Joint Committee of Public Accounts, a committee will have a win every so often, but only after a long and drawn out struggle with the parliamentary bureaucracy and sometimes responsible Ministers or office holders. This simply is not good enough. Committees must be able to draw on the staffing needs they consider appropriate. I believe the only way this can be handled is for the Parliament to give consideration to its own estimates.

Take the matter of Parliament House itself. There is not an honourable member in the place who does not recognise the inadequacy of this building, which was built as a temporary home for the Parliament in 1927. We have actually got as far as passing an Act to settle on a site for the new building. As I recall, that vote was on nonparty lines. I applaud that in itself. The Joint Committee on the New and Permanent Parliament House has recommended that the new building be proceeded with so that it can be opened as part of the bicentennial celebrations in 1988. That is now 10 years away, and I suggest that if we do not actively make a start in the forthcoming Budget there will be no possibility of opening a new house of parliament in 1988. Parliament itself has not been consulted. The report of the Committee, to the best of my knowledge, has not been debated. Nor have we had the opportunity to provide input into the process in the Budget context. This can be rectified only by the Parliament considering its own estimates.

Parliament House should not be solely the province of the Executive. It belongs to all of us and to the nation. Decisions that affect the future should not be solely in the hands of the Executive. This Parliament must be involved; otherwise we allow the Executive to commit us to a future in the totally inadequate conditions in which we have to work 15 hours a day, 26 or 30 weeks of the year. Decisions that affect this building will be taken in the Executive’s own good time. Parliament needs to make a stand. I do not want a confrontation with any Executive over an issue of this nature- Liberal-National Country Party or Labor. I hope that we are all big enough, mature enough and equipped with enough common sense to find a way through the total dominance of the Parliament by the Executive.

This domination extends into the sitting pattern of the Parliament as well as the financial controls that are exercised. Despite the long hours and weeks the Parliament sits there is virtually no time made available to private members. We have a half hour adjournment debate each night and an hour or so each Thursday for grievances or private members’ Bills which are rarely dealt with satisfactorily. I am concerned that very few reports to the Parliament are debated in the House. That in itself is a serious matter, but what is of more concern to me is that committees of this Parliament are continually bringing reports into the House which once tabled are invariably forgotten. Exceptions to this are the recent reports of the Expenditure Committee which, although not debated, were responded to in the Parliament by the Ministry. I think it is essential that reports, particularly committee reports, are debated, even if it is on a Friday when the Parliament would not normally sit. It would have to be, by arrangement, free of quorums and divisions. The Parliament cannot reasonably expect members to work on committees and not have their findings or recommendations debated. If the only solution is for the Parliament to sit more frequently than it does, so be it. That is why we are elected.

I emphasise again that I am most concerned by the way in which the business of the Executive dominates the time of the Parliament. I understand that the House of Commons and the Canadian Parliament allocate about 30 days a year to their Oppositions to nominate the subject of debate. I wonder how we would react to such a heretical suggestion. I appeal to all honourable members on both sides of the House and to the Ministry to give serious thought to the future of the Parliament as a constitutional institution. Perhaps we could make a worthwhile start by considering our own estimates and not being financially controlled by the bureaucracy and the Executive.

Amendment negatived.

Original question resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Motion (by Mr Fife) proposed:

That the Bill be now read a third time.

Mr HURFORD:
Adelaide

-I take the opportunity to explain to the House that the Opposition did not call for a division on its amendment in order to leave more time available for debate, not only on the Supply Bills but also on the Customs Tariff Amendment Bill (No. 2). I hope it is clear that our not calling for a division means that we in no way want to give the impression that we do not feel strongly about our amendment.

Question resolved in the affirmative.

Bill read a third time.

page 2445

SUPPLY BILL (No. 2) 1978-79

Second Reading

Consideration resumed from 10 May, on motion by Mr Howard:

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 Fife) read a third time.

page 2445

CUSTOMS TARIFF AMENDMENT BILL (No. 2) 1978

Second Reading

Debate resumed from 10 May, on motion by Mr Fife:

That the Bill be now read a second time.

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

- Mr Deputy Speaker, may I have the indulgence of the House to raise a point of procedure on this legislation? Before the debate is resumed on this Bill I would like to suggest that it may suit the convenience of the House to have a general debate covering this Bill and the Excise Tariff Amendment Bill as they are associated measures. Separate questions will, of course, be put on each of the Bills at the conclusion of the debate. I suggest, therefore, Mr Deputy Speaker, that you permit the subject matter of both Bills to be discussed in this debate.

Mr DEPUTY SPEAKER (Mr Millar:

-Is it the wish of the House to have a general debate covering both measures? There being no objection, I shall allow that course to be followed.

Mr HURFORD:
Adelaide

-The Opposition does not oppose either of these two Bills, the Customs Tariff Amendment Bill (No. 2) 1978 and the Excise Tariff Amendment Bill 1978. As is the custom with these types of Bills, I intend to address myself to general questions regarding the tariff rather than to the multitude of specific amendments involved in the legislation. I do this for a couple of reasons: Firstly, the changes which cover all the tariff measures which the Minister for Business and Consumer Affairs (Mr Fife), and perhaps in his stead other Ministers, has brought into this House over such a long period from April 1977, are far too numerous. Secondly, in so many cases we are well beyond the time when there could be meaningful debate on the issues. I shall come back to this in a moment.

I turn firstly to the small Bill, the Excise Tariff Amendment Bill 1978. This Bill is to restructure sub-item 17b of the Excise Tariff to clarify the duty liability in relation to condensate included in the Government’s crude oil absorption scheme. This is to correct an interpretation of this part of the Excise Tariff, which relates to indigenous crude oil. It is a machinery matter. The law was working in a way, as I understand it, contrary to the intentions of the Parliament when the Bill went through this House on an earlier occasion. This legislation clears up the matter.

I now devote my attention to the main Bill in this cognate debate, the Customs Tariff Amendment Bill (No. 2) 1978.I want to restrict my remarks in the remainder of the time available to me to general issues pertaining to this Bill. The purpose of the Bill is to enact formally the tariff changes made since April 1977. It is time- in fact it is beyond time or over time- to alter the procedures by which the Parliament considers tariff changes. I have already indicated that it is meaningless at this stage to debate the individual issues which have been brought to this House sporadically over such a long period. As these procedures stand at the moment there is little opportunity to scrutinise each individual tariff proposal.

Let us take the one that the Minister brought to the House today relating to metal working machine tools. It might be a year before a Bill such as the one that honourable members are debating tonight is brought to the House, to give legislative backing to the decision taken by the Minister. If honourable members were meaningfully to debate the decision taken by the Government, as announced to the Parliament today, we should have to do it over the next week or two, after we had had time to study the Tariff Board report. When customs tariff amendment Bills are introduced periodically to incorporate new tariff proposals it is virtually impossible to debate satisfactorily the various tariff changes. That procedure contrasts greatly with the consideration that the Parliament is rightly expected to give to bounty proposals.

I welcome the fact that we have separate bounty Bills. There are two on the Notice Paper at the moment. I am sure that the Minister will want them to come before the House over the next week or two- if we are to sit a second week- so that legislative backing is obtained for what is proposed. From memory, one is a book bounty Bill. Interested members will be able to devote their attention to the issue of assistance to the printing industry. Much goes through the House now of a tariff nature relating to industries which ought to be the subject of close attention by honourable members, but they do not have the opportunity to debate the issues as they should. That sort of procedure regarding tariff changes may have been satisfactory during the 1950s and 1960s, when tariff adjustments were part of a broadly accepted strategy based upon protecting Australian industry from import competition and fostering import substitution. However, honourable members must face the fact that that can no longer be the norm.

The purpose of a tariff is to protect jobs. That is what we want the tariff to do, but it is not doing so. I am on record this week as suggesting that a freeze on the existing level of tariffs is necessary, but we need more than a tariff in this day and age. We need quotas in the short run, to protect jobs. We need to go far beyond both tariffs and quotas. We need an industry policy. To repeat: The old idea of tariffs protecting jobs might have been all right in the 1950s and 1960s but it is no longer the norm today. We need a far more imaginative industry policy than just relying on tariffs. The Parliament must pay great attention to the whole matter of industry policy.

While he was the Opposition’s spokesman on industry and commerce my colleague the honourable member for Port Adelaide (Mr

Young) was aware of these problems. He proposed changes. I pay tribute to him for that. I repeat his call for more attention to be given in debates in the House to the totality of industry policy. The Government should recognise its responsibility to the Parliament in these matters. The Opposition’s decision not to oppose these Bills must not be allowed to conceal its concern over the direction of the Government’s industry policies. The Government’s attempts to emasculate the Industries Assistance Commission and to make it an advisory body only have been debated on an earlier occasion. Its failure to overcome the numerous inconsistencies and gaps in its industry policy, as evidenced in its White Paper on Manufacturing Industry, has also been debated. All are evidence of its inadequacies in this area, as in so many other areas.

The Government’s approach to industry policy and its attitude to the tariff have changed precious little since that approach was set out in the White Paper on Manufacturing Industry. Honourable members are depressingly aware that the White Paper, being very much a compromise document, made the rather contradictory distinction between short term and long term assistance policies. In general, the short term stance was heavily status quo, or do nothing in attitude. To me the long term approach appeared to accept the need for change. But no clear guidelines were given as to how the balance could, or would, be struck between attempting to insulate industries from change and allowing for change. Still, industry, regrettably, is left floundering between the short term policy and the longer term attitude of the present Government. No doubt these contradicitions are inherent in many of the amendments contained in the Bill being debated. More particularly, the Government seems to be intent upon using the tariff, along with other means of protection against overseas competition, as its main instrument to protect employment in Australian industries and to deal with unemployment.

That is just not good enough. As I intimated earlier, we need more than just that in order to stimulate employment in this nation. Though it is undeniable that urgent measures need to be taken to protect jobs and encourage recovery of Australian industries, it is already conventional wisdom that the Government’s heavy reliance upon increasing tariffs and other protective schemes will be ineffective in achieving these desirable objectives. Rather, it is likely that such temporary assistance is merely having the effect, firstly, of increasing inflation which is causing problems for industry in its desire to be internationally competitive. Secondly, it is increasing the profits of some assisted industries and not increasing employment opportunities in those industries. Thirdly, it is reducing net employment opportunities generally by further prejudicing the position of those industries more suited to Australian conditions and which could be expected to contribute more to the economy’s growth. Finally, it is delaying economic recovery. These consequences merely result in further pressures for more protection.

To bludgeon the Industries Assistance Commission into accepting its short term approach to industry policy the Government has relentlessly pursued its attempts to muffle this advisory body with a range of tactics. I noted those tactics in an earlier debate but they are worth repeating now. Firstly, there was the IAC bashing by the Prime Minister (Mr Malcom Fraser). That was aimed at intimidating the IAC and misleading the public as to who is to blame for the current employment difficulties. The second facet was that the terms of reference of IAC inquiries were severely limited in order to ensure that its recommendations simply advise on tariff levels necessary to maintain employment at current levels, whereas there must be a wider industry policy to promote new investment rather than just relying on the more narrow protective elements. Thirdly, there has been a limiting of the scope of IAC inquiries to very narrow product areas as opposed to allowing the IAC to apply its attention to wider industry groupings.

We have to recognise how interdependent a lot of products are on each other. It is not good enough for a mere advisory body in so many cases to be acting as a fireman dealing with one grass fire here and another one there. Those matters should be left to the Temporary Assistance Authority. The IAC should be allowed to get on with the broader task. I shall return to that aspect in a moment. The Opposition is suspicious of a Government that deals with unpalatable advice, not simply by rejecting it, but by trying to prevent the body from giving that advice again. I repeat my point: The IAC is an advisory body. It is essential that it should be allowed to give advice in an unfettered fashion. In effect the Government’s strategy of waiting until better days are here before tackling the problems of manufacuring is tantamount to adopting an anti-change or isolationist stance. I assert that because of my view that better days will not come again until the problems of Australian industry- that is, the essential reasons why many manufacturing industries are not internationally competitive- are confronted and tackled. For this reason it is unlikely that the short term, anti-change, element of the Government’s strategy will ever give way to the long term, pro-change element.

Even if it were possible to overlook the highly protectionist and isolationist nature of the Government’s approach to tariff policy, as disclosed in the Government’s White Paper on Manufacturing Industry, and even if one were to concentrate on the long term, pro-change, element outlined in the White Paper, there is no more cause for optimism. All the Government seems to be committed to in regard to the longerterm aspects of its industry policy is a complete reliance on tariff reductions to encourage the development of more efficient manufacturing industries in Australia. That reliance, which comes out in that longer-term element of the White Paper, is not good enough. Everything is left to the vagaries of market forces to reallocate resources between sectors and dictate the course of economic development in Australia. To add insult to injury, this apology for a policy is complemented by grossly deficient manpower programs.

In summary, with the possible exception of the recently announced, although minimal, export incentives which we have not yet debated in this House, the Government’s longer-term approach to the development of Australian industry relies on the combined effects of market forces and negative pressures- that is, punitive sticks for reducing tariffs in the long run. We on this side of the House say that that is not good enough. We must have more of the encouraging elements such as export development, research and development, positive investment policies to bolster the move for change, and to concentrate on those things that we do well so that we can do something about increasing the standard of living of the Australian people by encouraging manufacturing industry of this country. I am on the record already this week as saying that we in the Australian Labor Party believe that there is an absolute necessity for a manufacturing industry. We believe that the country cannot produce sufficient rewarding jobs without such a manufacuring industry. We believe, therefore, that a great deal more ought to be done to encourage that manufacturing industry with a wider range of policies than the present Government is relying upon.

The only glimmer of light in all this at the present time is the Government’s embarrassment over the deficiencies of the long-term aspects of its policies. In response to the almost unanimous criticism that the White Paper offered little encouragement with regard to such long-term policies it established the Crawford study group to recommend policies which might deal with structural change. For the time being, however, the nation is without any longer-term strategy for the development of viable and internationally competitive Australian manufacturing industries. Also, there is uncertainty as to how the Government will react to the recommendations of the Crawford group because of the Government’s doctrinaire rejections of intervention designed to offset the effects of market forces.

I have undertaken with the Government Whip that I would not take all the time available for me to speak. There is much I would like to say about industry policy and about the need for a body such as a national enterprise corporation to assist in relation to the crying need for investment in industry. I am very glad to note the Government’s announcement yesterday of the setting up of InterScan Australia Pty Ltd to do the sort of work which I think is essential in bringing private industry together to create jobs and to build new industry based on Australian technology. This is the sort of direction in which industry policy should be moving. I believe that this project probably will be a once only effort on the Government’s part to become involved in this sort of activity. I wish that it were not so. Certainly, we on this side of the House will be saying a great deal more about these matters in debates of this nature during the year.

Mr Peter Johnson:
BRISBANE, QUEENSLAND · LP

– I feel that some of the points which were raised tonight by the honourable member for Adelaide (Mr Hurford) should be discussed for a few minutes- the only few minutes in which I can speak on this subject because I, like the honourable member, have co-operated with the Whips to ensure that this legislation passes through the House this evening. No doubt, as the honourable member has mentioned already, the bounty Bills which are to come before the House will give us both an opportunity to further some of the points which he feels are important and which I also feel are important. The honourable member stated that this Government has involved itself in Industries Assistance Commission bashing. That is patently ridiculous. The IAC is an independent statutory body. It is a body which receives from industry under terms of reference all the information that it can possibly obtain and after receiving that information it puts to Government a suggested course of action.

The Australian Labor Party was never very happy with the IAC when it was in government because the decision that the Commission made in July 1 973 ensured that in the garment and textile industry some 48,000 people were no longer employed. Honourable members opposite accepted the recommendations of the IAC, made a determination, and the end results which I have mentioned ensued. We, as a government, consider that the IAC is an important body. It is a body which receives from various sections of Australian manufacturing industry information in relation to its particular problems. After that information has been collated and brought to Government, the Government in its own right and with its own understanding of the inimitable problems which sections of industry face makes a decision to ensure that the majority of people are benefited by that Government decision.

That leads me on to a point which I am delighted to speak about tonight in the debate on these two Bills. Over the last few months I have spoken to many industry people, not only in my federal division of Brisbane but also in the major cities of Sydney, Melbourne, and Adelaide. During that period I have found a great deal of praise and a great deal of goodwill shown towards the Minister for Business and Consumer Affairs (Mr Fife), who is at the table tonight, and his two colleagues, the Minister for Industry and Commerce (Mr Lynch) and the Minister for Productivity (Mr MacPhee), for their understanding of the problems which have been facing Australian manufacturing industry. They have also mentioned to me on numerous occasions that the officers of the Commonwealth Public Service who staff these departments- particularly the Department of Business and Consumer Affairs and the Department of Industry and Commerce -have a great deal of understanding and compassion, and a willingness to listen. Through that willingness to listen, manufacturing industry believes it has achieved what is now current throughout industry. This is not so in its entirety, but in the main there is a sense of stability which is ensuring that people are now starting to reinvest in these industries to ensure that they will have a growth of investment and that they will be taking up even more of the unemployed, thus helping to solve the problem which has been dogging our heels for the last 24 months. I can see a growth factor which is going right through to the mid-1980s. Before we reach that point in time, I believe that we must look again at this vexing problem of tariffs and quotas and work out a policy which will ensure that those people who have invested so much of their capital and so much of their working lives in these industries have a continuity of employment and investment.

However, there is one very important matter which I believe should be mentioned. I refer to the difficulty which the Government is facing and which industry is facing because of the number of people who are trading in quotas. By an accident of history a number of people were placed in a gilt-edged financial situation. By an accident of history, through the action of the previous Labor Government, in the period from 1973-74 or from 1972-73 as the base years for the textile and garment industry, certain people were awarded quotas. The end result of this has been that those people who entered the importation field since that time have accumulated an enormous degree of wealth which has not cost them any personal effort or time. The present situation is that people are renting footwear quotas on a seasonal basis. The current rate for a pair of shoes which can be imported is $2 twice a year. Some people have quotas which amount to between 50,000 and 100,000 units. This means that a person with a quota of 100,000 units who rents his quota can receive in the vicinity of $400,000 at the end of one year. In the garment area, the price range for the rental of quota, again on a seasonal basis -

Debate interrupted.

page 2449

ADJOURNMENT

Mr SPEAKER:

-Order! It being 10.30 p,m., I propose the question:

That the House do now adjourn.

Mr Fife:

– I require that the motion be put forthwith without debate.

Questions resolved in the negative.

page 2449

CUSTOMS TARIFF AMENDMENT BILL (No. 2) 1978

Second Reading

Debate resumed.

Mr Peter Johnson:
BRISBANE, QUEENSLAND · LP

– The current rate for the rental of quota in the garment field is rising from $ 1 to $3. Again people who have 50,000 units, such as women’s dresses, skirts, blouses and shirts, are in the situation, with a $3 rental on their particular quota, of having in the vicinity of $300,000 at the end of one year. This has meant that in the imported area there is a considerable degree of lack of competition. That is unlike the manufacturing area where there is a vast degree of competition, a keeness in relation to manufacturing prices, and a keenness in the market place. A number of the importers have not been concerned with providing for the consumer, the end product user, a worthwhile item at a worthwhile price by passing on the price advantage from the cheap, low cost countries.

In the last few years, we have had people who have become known as quota brokers. Those people work on a commission, charging between 3 per cent and 8.5 per cent. That is the rate charged by those I have seen myself. They are in the business of finding people who have a quota and going to other people who require a quota for garments. They sell the quota at the rate of commission which I have mentioned. I believe it is a practice which should not continue in Australia because it is making the position extremely difficult in the manufacturing sector, in the market place, which until now has been reasonably stable and which has been going ahead at a great rate of knots.

There is a further problem in this area in that these very same people have been using handicrafts and imports from developing countries to the tune this year of some six million units. I have estimated that number from figures which I have received related to the 1977-78 financial year. Some six million units will flood this country, particularly women’s blouses, women’s shirts, dresses and skirts. I believe that we must look at the problems which have been associated with these two particular areas- the trading in quotas and the use of the handicrafts and imports from developing countries- in order to ensure that these practices do not continue.

These two Bills are part of a continuing series of Bills which are introduced at certain times and I support them. I shall see whether I can use some of my time in the next few weeks to continue some of the arguments which I have developed tonight.

Mr SCHOLES:
Corio

– I note that there is reference in Supply Bill (No. 1 ) 1 978-79 to commercial vehicles. Tonight, I want to raise with the Minister for Business and Consumer Affairs (Mr Fife) the growing concern and uncertainty about the future of the Australian motor industry. It is one of Australia’s major employers. It is also like the textile industry in that it is peculiarly regional in effect. There are two or three major regions which are very vulnerable to any changes in circumstances. I am aware that figures released this month show an upward trend in motor vehicle registrations.

The short term problem clearly is lack of sales rather than competition from outside Australia. The lack of sales can probably be associated with the high cost of replacement vehicles. There are delays in the purchase of changeover vehicles. The very high cost of hire purchase, operating costs and the accelerating price of motor vehicles are relevant factors. The Government has to review the existing arrangements in the industry. It has to decide whether the market for Australian vehicles, which has not grown for six years now, can afford additional expansion in the capacity of the Australian industry. The imposition of higher tariffs on imported vehicles will not solve the situation.

As I mentioned earlier, the cost of vehicles is now one of the main factors against a recovery in the market. The changeover cost of vehicles, say, four years old is about 100 per cent of the original purchase price of the vehicle. Obviously that is a serious deterent. The Australian design and tooling sections, the skilled sections of the industry are in serious decline. In the commercial vehicle field, assembly has become the main area of activity. It looks as though the motor vehicle industry will degenerate into an assembly industry in the next five years, with Australian companies being dependent on imported designs and possibly imported tooling. I do not think the Government can take rational action which will prevent that type of technology from being imported. Therefore the solution in the Australian scene would seem to be some sort of internal support to the tooling and design areas. I understand that Australia is one of the few countries manufacturing motor vehicles which does not give internal support to tooling and design and that type of processing.

These are important technical areas in the industry which have been neglected in the past and which have tended to be protected by the types of vehicle plans which have been adopted. Unfortunately, those plans have had built into them, ever since their original inception a number of years ago, the seeds of the destruction of the industry. All the major manufacturers in Australia are moving towards the adoption of world designs, world cars. If something is not done to encourage the utilisation of Australian skills in this area, the capacity in Australia to do these things will disappear and therefore there will be no jobs for our trained personnel who are among the world’s most competent. There will be no employment for them and therefore we will have lost a major segment of an industry in which skills are important.

I raise the question because I believe that the Government must at this stage be very concerned about the industry and must look at means by which it can take rational action which will protect the Australian content of the industry without substantially altering the present tariff arrangements. As I say, that is not an option which is open to the Government. There are means by which design and tooling processes can be assisted, namely, by means of taxation and other things. Such assistance would pay off handsomely to the Government in the longer term. It is an important industry. It is a highly regional industry and, at the moment, it is highly competitive between regions. If one manufacturer goes to the wall, then the jobs in one region disappear. It is a serious problem.

Mr Goodluck:

– I gave way to the honourable member for Adelaide because he is in Sydney.

Mr SCHOLES:

– That is fair enough. I raise the matter because it is important to as many as 90,000 Australians whose jobs are in jeopardy. I think the Minister ought to take cognisance of my remarks. I do not know exactly what honourable members opposite are complaining about, but in my electorate there are 6,000 people whose incomes depend on this industry. I happen to think it is an important one.

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 Fife) read a third time.

page 2450

EXCISE TARIFF AMENDMENT BILL 1978

Second Reading

Consideration resumed from 12 April, on motion by Mr Fife.

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 Fife) read a third time.

page 2450

ADJOURNMENT

Security: Use of Armed Forces- Role of the Judiciary in Government- ‘The Third Man’-Taxation

Motion (by Mr Fife) proposed:

That the House do now adjourn.

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

– Honourable members will recall that at the time of the Hilton bombing when the Commonwealth Heads of Government Regional Meeting was taking place the Governor-General gazetted a minute on 14 February to the effect that the troops should be called in to serve the purposes of the Australian Government. Many people in our community contended that there was dubious constitutional validity for that action. Similarly, there was great concern that the matter was without precedent and that the decision was taken without any particular time or geographical limitations. That is to say, a martial law situation descended on Australia quite unexpectedly and could have prevailed for some considerable time. Everybody realises the necessity for adequate security in such situations. Since then we have had an inquiry in respect of the adequacy of our security in Parliament House and certain proposals have been made in connection with that.

In this context I want to raise a matter of concern to me. At the funeral of Sir Robert Menzies last week, which I attended, I was very surprised to see the utilisation of Austraiian service personnel. I am not sure of the purposes for which they were utilised. I did observe that Army officers were used on traffic control, and presumably they were being used for the maintenance of security. I think it is very important for the House to know who requested, and on whose authority approval was given, for the use of defence personnel on that occasion. One wonders whether the Victorian Government conceded that the Victorian Police were inadequate in their capacity to control traffic or indeed to sustain the security that was necessary. One wonders whether the Victorian Government actually called for assistance from the Australian Government in this matter. I think it is important that we should know the provision under which serving personnel were utilised on that occasion. I think it is important for us to know the guidelines under which this kind of action might be taken in the future.

There seems to me to be a tendency to .popularise this martial law type of practice. It is a very undesirable thing, even though some might say it is necessary to supersede the practices of ordinary Australian police force administrations and to utilise the armed forces. One wonders what the rights of police are in such situations, even in such mundane matters as directing traffic and the extent to which they are able to lay charges against people and to seek to substantiate those charges. I assure honourable gentlemen that discerning people in this country have watched the development of trends in this regard in other parts of the world. They view with the greatest disquiet the tendency on the part of the Fraser Government to utilise troops in what appears to be most unnecessary situations. I have no doubt in my mind that the police could have dealt adequately with traffic control and security at the funeral last week of Sir Robert Menzies. I am gravely concerned that this action was taken. I believe that either the Prime Minister (Mr Malcolm Fraser) or the Minister for Defence (Mr Killen) should make a statement to the Parliament and to the people and indicate whether troops were required because of the inadequacy of established services and the extent to which this Government believes in involving martial law type situations in the future.

Mr FALCONER:
Casey

-At the Australian Institute of Political Science seminar in Canberra on Australia Day weekend last January, Professor G. S. Reid, Professor of Politics, University of Western Australia, delivered a thoughtful and incisive paper which has already been quoted by many people. One particular aspect of his address dealt with a matter which has troubled me in recent times, namely, the changing role of the judiciary in the Australian political structure. Professor Reid pointed to the increasing number of judges at Commonwealth level who are being appointed to various boards, commissions and tribunals which might be seen as part of the Executive arm of government. My own concern was initially prompted by the appointment late last year of Mr Justice Fox as Ambassador-at-Large on nuclear matters. On researching the matter further my concern has been deepened.

Three questions come to mind. Firstly, is it in keeping with the independence of the judiciary for judges to be seen to accept such government appointments while retaining their judicial status and privileges? Secondly, does it take judges away from the performance of strictly judicial work for which there is a lack of suitable people, thus adding to delays in having matters heard by the courts? Thirdly, can it lend a false image of judicial independence and impartiality to matters that are politically controversial and partisan in nature? The judges of the Victorian Supreme Court take a very strict view of this matter. On 14 August 1923 Chief Justice W. H. Irvine wrote to the Victorian Government on behalf of the Supreme Court of Victoria in the following terms:

The duty of His Majesty’s Judges is to hear and determine issues of fact and of law arising between the King and a subject, or between a subject and a subject presented in a form enabling judgment to be passed upon them, and when passed to be enforced by a process of law. There begins and ends the function of the Judiciary.

Apart from some diversion from the principle in the early 1950s the Victorian Supreme Court has adhered to this view far more strictly than any other Bench in Australia.

A quick review of the statutory and Executive positions presently held by judges in the Commonwealth produces a list of more than 20 boards and tribunals involving about 30 judges. The degree of involvement by individual judges varies from unpaid part time attendance at occasional meetings to full time salaried positions. No one can reasonably object to three judges of the Family Court of Australia being members of the Family Law Council. Similarly it is appropriate to have two judges on the Law Reform Commission. It also seems to be appropriate to have a judge as Royal Commissioner for the inquiry into drugs as certain matters of law and liability to prosecution may have to be considered with due judicial care.

However, it is not obvious that a judge should be appointed Ambassador-at-Large on nuclear matters or as Director-General of the Australian Security Intelligence Organisation, or a member of boards such as the National Advisory Council for the Handicapped. It cannot be argued that these positions require the skill and judicial training of a judge. Indeed it may be argued that in some cases governments are using the status and prestige of the judiciary to lend legitimacy to actions of the Executive arm of government. The sight of Justice Elizabeth Evatt on Monday Conference some months ago defending aspects of the report of the Royal Commission into Human Relationships brought to mind a further quote from Chief Justice Irvine’s letter to the Victorian Government. He wrote:

Parliament, supported by a wise public opinion, has jealously guarded the Bench from the danger of being drawn into the region of political controversy.

Justice Elizabeth Evatt, of course, was a member of the Conciliation and Arbitration Commission when she was appointed Chairman of the Royal Commission, but by the time the report was presented she was Chief Judge of the Family Court of Australia. Whatever one might think about the findings of the Royal Commission, I certainly felt some disquiet at the sight of a senior member of the judiciary publicly arguing matters that were in the realm of social philosophy rather than legal principle. Let me add that I believe it would be desirable for judges to involve themselves far more in public debate about the interpretation of law and the functioning of our judicial system. However, we must give careful attention as members of parliament to any attempt by the Executive to use the status and prestige of the judiciary in support of its partisan political objectives. I hope that members of the judiciary will also be careful not to accept positions which appear to compromise their independence.

Mr YOUNG:
Port Adelaide

– I do not altogether disagree with the honourable member for Casey (Mr Falconer), and I suspect that not all my colleagues shared my views about the appointment of Mr Justice Fox as a roving ambassador on the question of uranium safeguards. At the time I thought it was a little strange that, being in the position he was in, he was able to accept that task from the Government. However, that is not the reason I have risen to speak tonight. I want to refer to the review of a rather amazing book that has been made available to the public today. I was interested in the title, The Third Man, because if memory serves me correctly The Third Man was a story about someone running around the sewers trying to evade the police. If I am correct, the author of this book must have been running around somewhere because the level of his politics does not seem to be extremely high. Having been a minister and the Leader of this House for some time, he did not seem to have anything substantial to say about Australian political life. He referred to putting oysters or onions or whatever it was in one’s pocket and he noted that the Minister for Foreign Affairs (Mr Peacock) has the proper breeding to be a Prime Minister. If that is the level of his concept of the House of Representatives in Australian politics after all that time, then I do not know whether his replacement of Senator Wright will add much to the Senate. Perhaps we should look at that replacement. It seems amazing that someone who has served in this chamber for so long has to see the House of Representatives and the people he worked with in that way.

There is no doubt in my mind that it is a fictitious story. First of all, he had to borrow a journalist to help him write the book. Secondly, instead of being something substantial that could add to people’s understanding of the role of Parliament and the role of politicians, people are going to think a lot less of this institution and a lot less of those who serve in it because of the gossip that has been incorporated in the book and because the author seems to want to settle scores and perhaps promote a couple of people who are obviously his friends. Honourable members can imagine how I felt as an old shearer when I read that breeding had something to do with whether or not one could be successful in this chamber. I looked around at a couple of my colleagues, and I know that the honourable member for Hunter (Mr James) was very upset about it. I do not know whether the Parliamentary Library will be rushed by people who want to read the book, but it does not seem to me to add much to our lifestyle, unfortunately.

Dr Klugman:

– Fraser ordered 27 copies. The Government is paying for them.

Mr YOUNG:

– According to the book, he has no taste. It is unfortunate that people who do not serve in this chamber cannot see their way clear to writing something constructive and decent, something that could be looked upon by students of politics as being helpful to their studies, rather than this type of sensationalism about what life here is like. I do not know how many people knew of the events that the author, Mr Chipp, has gone to the trouble of telling us about. It does not seem terribly interesting to me.

Mr Ellicott:

– Could you explain to us why you read it?

Mr YOUNG:

-It seemed to be the only thing that the newspapers were interested in telling us about this morning. Perhaps that is the reason the book was written in the style that it was. It was not written for the public; it was written for sensationalism, it was written for the headlines. I can assure honourable members that it is the belief of those on this side of the House that had the Prime Minister (Mr Malcolm Fraser) put Mr Chipp in the Ministry the book would never have seen the light of day. The book was written by someone who is very upset about having been left out of the Ministry, nothing more and nothing less.

Mr N A Brown:
DIAMOND VALLEY, VICTORIA · LP

– The issue of the grant of 2 per cent of personal income tax to local government has again raised some currency, and that should stimulate us to look fairly closely at some of the activities of local government bodies. I should say at the outset that the case for the granting of 2 per cent of personal income tax is overwhelming and the Government has already committed itself to that course. However, this is a suitable opportunity to examine the question of whether some local government bodies are not content to confine themselves to proper municipal functions but rather want to intrude into the proper responsibilities of other areas of government, in particular the Federal Government. It probably comes as no surprise to you, Mr Speaker, that a particular incident has provoked me into raising this matter tonight, and it arose in the following way. There is in Melbourne a body described as Region 14. Its correct title is the Northern Melbourne Regional Organisation of Councils, No. 14, Victoria. That body covers the municipalities of Diamond Valley, Eltham, Heidelberg, Northcote, Preston and Whittlesea. It is a region which covers some very significant areas of Melbourne. The organisation has been moved to hold a meeting on Wednesday, 7 June 1978, to form what it is pleased to call an employment committee covering those areas. What are the functions of this employment committee to be? Broadly, they are to investigate the issue of unemployment.

Let us look a little more closely at one of the areas that the meeting intends to investigate. To quote from the document that the body has circulated, it is ‘to investigate the factors of influencing the present level of employment and those which have impact on future employment levels ‘. One would not need to be particularly intelligent to discern that this body is to embark upon an exercise of beating the Government over the head on the issue of unemployment, to point the finger at the Federal Government as being responsible for the unemployment that exists at present and for failing to take proper action to reduce unemployment. It is known, of course, that such accusations are completely false, and I refer in particular to the wideranging programs being embarked upon by the Federal Government at the moment to train people to equip themselves to obtain employment in the work force.

There are two vices in what might seem to be the fairly harmless exercise upon which this organisation is embarking. I suggest that it is nothing more than a trumped up political exercise. The first of the two vices is this: The area concerned covers the electorates of some five Federal members of Parliament. The organisation involved has invited one member of parliament to speak to the function, to lead the argument, and I suggest to commence the attack on the Federal Government on the issue of unemployment. Of all the Federal members who could have been chosen to perform that task the organisation has chosen by a remarkable coincidence the honourable member for Batman (Mr Howe), who is a member of the Australian Labor Party. There is no doubt at all that this is an attempt to use the honourable member for Batman as part of the political exercise upon which this organisation is engaged. I suggest that it is most improper for it to endeavour to do that. It is most improper for the organisation not to seek contributions from myself and the honourable member for Casey (Mr Falconer), whose electorates also cover the area concerned. We have not been invited to contribute to the discussion.

Only the honourable member for Batman, a member of the Labor Party, has been invited.

The second vice is this: It is ratepayers’ funds that will be used for the exercise. In addition, as local government now receives a share of personal income tax, taxpayers’ money will also be used. The taxpayers’ money and the ratepayers’ money will be used for nothing more than a trumped up political exercise, a campaign by politically inspired people to attack the Federal

Government on an issue which is solely within its responsibility. It seems to me, with respect, a quite improper use of ratepayers’ funds and taxpayers’ money to embark upon a political exercise of this nature.

Mr SPEAKER:

-Order! It being 1 1 p.m., the debate is interrupted. The House stands adjourned until 10 a.m. tomorrow.

House adjourned at 11 p.m.

Cite as: Australia, House of Representatives, Debates, 24 May 1978, viewed 22 October 2017, <http://historichansard.net/hofreps/1978/19780524_reps_31_hor109/>.

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