Senate
16 October 1951

20th Parliament · 1st Session

  1. Senate
  2. 20th Parliament
  3. 1951

The President (Senator the Hon. Edward Mattner) took the chair al 8 p.m., and read prayers.

page 605

SENATOR SWORN

Senator SIDNEY Wainman O’FLAHERTY made and subscribed ‘the oath of allegiance as senator for the State of South Australia.

page 605

QUESTION

WOOL

Senator PIESSE:
WESTERN AUSTRALIA

– “Will the Minister acting for the Minister for Commerce and Agriculture inform the Senate whether the High Court has delivered its judgment in the case relating to Joint Organization payments to wool-growers who sold their wool to private buyers during the last war ?

Senator McLEAY:
Minister for Shipping and Transport · SOUTH AUSTRALIA · LP

– Tho High Court has not -yet. delivered its judgment.

Senator PIESSE:

asked the Minister acting for the Minister for Commerce and Agriculture, upon notice -

  1. How many boles of wool remain unsold by the Joint Organization T
  2. What amount of money is held by the Commonwealth Government on behalf of the wool-growers of Australia from the sale of wool by the Joint Organization ?
  3. Is it the intention of the Government to make a payment to wool-growers from these funds in the near future; if so, when?
Senator McLEAY:

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

  1. All of the accumulated stocks of Australian wool have now been disposed of by the Joint Organization.
  2. The amount held on behalf of .the Commonwealth Government as Australia’s share of the profits made by the Joint Organization from the sale of Australian wool is approximately ?05,500,000 (Australian currency). A further relatively small amount will bc received in- respect of the last sales by Joint Organization of Australian wool.
  3. The matter is receiving consideration at present but I an] not in a position to make a statement as to when a payment will be made. However, an announcement on the matter will be made as soon as possible.
Senator PIESSE:

asked the Minister acting for the Minister for Commerce and Agriculture, upon notice -

Is it the intention of the Minister to recommend that all growers of wool during^ the last war whose .wool was sold by the Joint Organization and who are sow no longer growers of wool shall receive an early settlement of moneys owing to them from Joint Organization funds?

Senator McLEAY:

– The answer to the honorable senator’s question is as follows h=-

The -Minister for Commerce and Agriculture has already announced the Government’s intention to distribute to those war-time woolgrowers who have since left the industry, profits due to them from the disposal by the Joint Organization of stocks of Australian wool accumulated during the war. Amending legislation will be required for the purpose. The winding up of the Joint Organization will entail a considerable amount of detailed work, and it will be some time before the ultimate financial result of the Joint Organization transactions can be determined. Moreover, the matter cannot be finalized until a decision is given on certain legal aspects inherent in a challenge case which is presently before the High Court.

page 606

QUESTION

POSTAL DEPARTMENT

Senator BENN:
QUEENSLAND

– Can the Minister representing the Postmaster-General say whether his colleague is aware that when officers of the Postal Department in Brisbane were dismissed recently the provisions of the Re-establishment and Employment Act were not observed because ex-servicemen were discharged and a retired member of the Queensland police force, who is in receipt of a substantial pension, was retained in his employment?

Senator COOPER:
Minister for Repatriation · QUEENSLAND · CP

– If the honorable senator will supply me with further details of this matter, I shall be pleased to bring it to the notice of the PostmasterGeneral.

Senator SHEEHAN:
VICTORIA

– Can the Minister representing the Postmaster-General say whether it is true that an imported prefabricated house is being erected at Bairnsdale, Victoria, for the postmaster in that town? If so, what department has been responsible for the importation of the house, what is the estimated erected cost, and what is the. country o( origin? Is the Minister aware that considerable public criticism has been caused by the erection of this dwelling in what is considered to be one of the building areas in Bairnsdale? Is it proposed to erect similar in other country centres and if so, in what centres are they to b*built ?

Senator COOPER:

– I shall convey th, honorable senator’s questions to the Postmaster-General and obtain a considered reply as soon as possible.

Later:

Senator COOPER:
CP

– On the 26th September, 1951, Senator Willesee asked the Minister representing the PostmasterGeneral, upon notice -

Will the Minister representing the PostmasterGeneral inform the Senate of the num. ber of telegrams handled by the Telegraph Branch of the Postmaster-General’s Department in July and August, 1950, and in July and August, 1851? Will the Minister also state the revenue derived by the branch during the same periods?

The Postmaster-General has furnished the following, reply : -

Statistics of the number of telegrams’ handled by the Postmaster-General’s Department during the months of July and August, 1951, are not yet complete and are not likely to be avail able for some weeks pending the receipt of all outstanding returns from remote centres It is not practicable at this stage, therefore, to. furnish comparative figures of the telegraph loads dealt with during July and August ii) the years 1950 and 1951. The revenue received from telegrams for July-August, 1951, repr; sented approximately £850,000, compared with £625.000 during the corresponding two month.of 1950, the increase representing 36 per cent When the final telegraph load figures for thi July-August, 1951, period are available they will be furnished to the honorable senator.

– MILK.

Senator ANNABELLE RANKIN.Can the Minister representing the Minister for Health state whether it is a fact that although free milk is being provided for children in several of the southern States of the Commonwealth under the Commonwealth health scheme, it if not being provided to Queensland school children? If that is so. will the Minister inform the Senate why tho Queensland children are not receiving- such milk ?

Senator COOPER:

– I waa not aware that the free milk scheme for school children is not operating in Queensland. Towards the end of last year legislation was passed by the Parliament whereby free milk was to be issued to school children throughout Australia. However, the responsibility for distribution of the milk rests with the various States, working in co-operation with the Commonwealth authorities. I understand that a number of States have already taken advantage of the scheme. If Queensland has not done so, no doubt it is because the government of that State has not co-operated with the Commonwealth authorities I shall take the matter up with the Minister for Health and obtain a considered reply to the honorable senator’s question.

page 607

QUESTION

FRUIT

Senator McKENNA:
TASMANIA

– Will the Minister for Trade and Customs arrange for the tabling of the report and findings of the Bureau of Agricultural Economics regarding the costs of production in the berry fruits industry? Is there any reason why the Government should not accept with confidence the findings of the bureau in this matter ? In view of the publicly announced policy of the Government that primary producers should receive such prices for their products as would cover duly, ascertained reasonable cost of production, together with a reasonable margin of profit, will the Minister direct the attention of the Fruit Industry Sugar Concession Committee to those findings of the bureau? At the same time, will the honorable senator direct the attention of that committee to the policy of the Government and indicate its acceptance of the findings of the bureau? As the Fruit Industry Sugar Concession Committee will meet on Friday week, 26th October, and as the minimum prices fixed by it as the basis of rebates to sugar producers are, with rare exceptions, treated as maximum prices, will the Minister give early consideration to my requests?

Senator O’SULLIVAN:
Minister for Trade and Customs · QUEENSLAND · LP

– I answer the last question asked by the honorable senator by saying “ Yes “. I shall be very happy to do so. Naturally, I am not in a position to answer offhand the other questions asked by him, but I shall treat them as being on the notice-paper and shall furnish him with an answer as soon as possible.

page 607

QUESTION

PRIMARY PRODUCTION

Senator O’BYRNE:
TASMANIA

– World food authorities are predicting a- grave shortage of food, and in Australia - we are faced with a serious decline ox the acreage under wheat. In Tasmania, the acreage under potatoes has also declined alarmingly. In view of the declining production in Australia of wheat, potatoes eggs, butter and vegetables, and also of the general decline of food production throughout the world, will the Minister for Trade and Customs urge the Government to consider the acquisition and cutting up of large pastoral and agricultural holdings so that thousands of landhungry men, who are willing to farm on their own account, may get on to the land and produce the commodities which are so much needed?

Senator O’SULLIVAN:
LP

– The Government is conscious of the fact that the world, including Australia, will face an acute shortage of food within a limited number of years. As for the resumption and cutting up of land, I remind the honorable senator that the powers of the Commonwealth are much restricted by the Constitution. Land administration is essentially a State matter. I assure the honorable senator that any project which would result in increased settlement on the land and greater production of food would receive the blessing of this Government.

page 607

QUESTION

POLIOMYELITIS

Senator TANGNEY:
WESTERN AUSTRALIA

– Will the Minister representing the Minister for Health urge the making of inquiries into the Kenny method of treating poliomyelitis with a view to establishing in this country a clinic on the lines of those already established in the United States of America, Russia, France, Greece, Denmark, Norway and other European countries where they have proved their worth over a period of years?

Senator COOPER:
CP

– I shall bring the honorable senator’s question to the notice of the Minister for Health, and a reply will be furnished as soon as possible.

page 608

QUESTION

SULPHUR

Senator CHAMBERLAIN:
TASMANIA

– Has the Minister for National Development read press reports to the effect that a very influential syndicate has been formed in England for the purpose of conducting investigations into ways and means of increasing the world’s supply of sulphur, and that the syndicate is operating with the full approval of the Government of the United Kingdom ? Will the Minister discuss this move with the Cabinet in order to learn whether Australia can benefit under the proposal?

Senator SPOONER:
Minister for National Development · NEW SOUTH WALES · LP

– I read a newspaper report about the British syndicate, and I wish it success, because the shortage of sulphur throughout the world is causing some concern. There is no need to refer the matter to the Cabinet, because, for some considerable time past, the Government has been actively considering this problem. We in Australia do not have to rely on elemental sulphur, which is becoming scarcer. We can produce sulphuric acid from pyrites, of which there are large quantities available. The task is to produce from pyrites the sulphuric acid that is required. It will involve modifications of plants which up to the present, have treated elemental sulphur. A good deal of work has already been done and much progress has been achieved. A Cabinet sub-committee has been appointed to examine the problem, and a very strong interdepartmental committee, consisting of both technical and administrative officers, is also watching day to day developments. We wish the English syndicate success in its efforts to discover new deposits of elemental sulphur. We must realize, however, that even if it is successful in discovering such deposits some time may elapse before they can be developed. Recently the reported discovery of a new deposit in the United States rather buoyed our hopes until investigations by our technical officers revealed that some years would elapse before supplies could be made available from that source. The Government hopes that the efforts of the syndicate will be successful, and also that Australian sulphuric acid manufacturers will not in any way slacken their efforts to convert their plants in the hope that the English syndi cate will be successful, or in the belief that the new United States deposits will provide- a ready solution of the world wide problem of the shortage of sulphur.

page 608

QUESTION

SOCIAL SERVICES

Senator NASH:
WESTERN AUSTRALIA · ALP

– In view of the proposed legislation to amend social service benefits, will the Minister representing the Minister for Social Services consider what appears to be a hardship, or an anomaly, in the legislation providing for unemployment and sickness benefits under which a man who continues in employment after reaching the age of 65 years is ineligible to claim the unemployment benefit? Will the Minister consider the desirability of amending the act to enable such a person to qualify for. the benefit whilst he is unemployed, provided he is not in receipt of the age or other pension benefits?

Senator SPOONER:
LP

– The honorable senator will have an opportunity to debate this matter when the Social Services Consolidation Bill is before the Senate, which, I hope, will be within the next few days. To give an offhand answer to the question I remind the honorable senator that long departmental experience has shown that there is no need- to continue the payment of the unemployment and sickness benefit to persons 65 years of age. and over, because when they reach that “age they become entitled to the age pension. The honorable senator has suggested that the provisions of the legislation should be amended. I do not think that there is need for- such an amendment. The two benefits are distinct from one another. When a man becomes ineligible for the sickness and unemployment benefit because of advancing age, he can readily obtain the age pension.

page 608

QUESTION

DAIRYING

Senator WOOD:
QUEENSLAND

– In view of the fact that the Queensland Government disputed the right of the dairying industry to a price of 3s. lid. per lb. for butter, it having very clearly indicated that it did not believe in the necessity for such a price, and, indeed, introduced dictatorial legislation to control butter prices, and that, later that Government, in order to save its face, referred the matter to the Queensland Prices Commissioner, can the Minister acting for the Minister for Commerce and Agriculture state whether that price has yet been determined by the Queensland Prices Commissioner, and if not what price has been decided upon?

Senator McLEAY:
LP

– I have been advised unofficially that the Queensland authorities have seen the light and that the price of butter in that State will be increased to 3s. l$d. per lb. to-morrow, but so far, I have had no official confirmation of that advice.

Senator GORTON:
VICTORIA

– Has the Minister acting for the Minister for Commerce and Agriculture any information to indicate that at last the Labour Government of New South “Wales has broken down and decided to do justice to the dairyfarmers in that State in the matter of the price of butter and the cost of production of that commodity?

Senator McLEAY:

– I have not received any information from New South Wales on this subject, but I am hoping that before the day is out the New South Wales Government also will have seen the light.

page 609

QUESTION

PREFERENCE TO EX-SERVICEMEN

Senator COOPER:
CP

– On .the 26th September, Senator Aylett asked the Minister representing the PostmasterGeneral -

Can the Minister representing the PostmasterGeneral inform me whether a Postal Department employee with years of active service to his credit would be given priority over a man who had been called into camp one week and exempted from service in the following week, but who nevertheless is classed as an ex-serviceman?

The Postmaster-General has now furnished me with the following information : -

In determining the order of preference in employment between two or more former members of the Forces who are entitled to preference in accordance with the provisions nf the Re-establishment and Employment Act consideration is given to the length, locality, nuri nature of the war service of each. The act provides, however, that the qualifications nf the men for the position sought and any other relevant factors be taken into account also so that each case must be decided individually.

page 609

QUESTION

WHEAT

Senator MORROW:
TASMANIA

– According to press reports, most primary industries will be expected to carry the increase of the price of wheat for stock feed from 7s. lOd. a bushel to 16s. Id. a bushel. As that would result in a further increase of the basic wage and a consequent accentuation of inflation, will the Minister acting for the Minister for Commerce ana Agriculture consider subsidizing the sale of wheat for stock feed to the full amount of the increase, otherwise great hardship will be suffered by pensioners and others on fixed incomes because of the steep increases that will occur in the price of eggs and other foodstuffs?

Senator McLEAY:
LP

– I am afraid that the reports to which the honorable senator has referred were wrong, or that he .has not read them correctly. The Government has indicated that it believes that the price of wheat for stock feed in this country should be 16s. Id. a bushel, which is the figure fixed under the International Wheat Agreement, and that it would be prepared to subsidize the sale of eggs for home consumption and export to the full amount of the increased price of wheat. The Government has decided that, when the new price for wheat applies, the freight on wheat transported to Tasmania and Queensland will be paid by the Australian Wheat Board. If the State governments agree to the Australian Government’s proposal, the price of eggs will not be increased, and therefor the index figure upon which the basic wage is based will not be affected, because poultry meat is not included in the basic wage regimen.

page 609

QUESTION

HEALTH AND MEDICAL SERVICES

Senator ARNOLD:
NEW SOUTH WALES

– Will the Minister representing the Minister for Health inform me of the cost to the Government of supplying life-saving drugs free to sick people 1 Can the Minister say how that cost compares with the cost to the Australian people before the Government decided to make those drugs available free of cost?

Senator COOPER:
CP

– I am unable to supply the information offhand. However, I shall be very pleased to ask my colleague, the Minister for Health, to furnish the honorable senator with a considered reply direct.

Senator McKENNA:

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

  1. What organizations in the nature of friendly societies have been approved under the Private Hospital Benefits Regulations?
  2. What stage has been reached in negotiations between the Government and the State governments regarding an amended basis for public hospital benefits?
Senator COOPER:

– The Minister for Health has supplied the following answers : -

  1. No organization in the nature of a friendly society has been approved under the Hospital Benefits (Private Hospitals) Regulations.
  2. Negotiations are proceeding and an announcement of policy will be made as soon as possible.

page 610

QUESTION

ROAD SAFETY

Senator ROBERTSON:
WESTERN AUSTRALIA

– Will the Minister for Shipping and Transport inform the Senate whether persons and companies that operate tourist coaches must comply with stringent regulations in the interests of safety on the roads? In view of the tremendous increase of accidents in which those vehicles are involved, will he cause inquiries to be made as to the cause of this increase, and, if necessary, have the regulations tightened in order to reduce such accidents if possible? I point out that to-day Australia has the reputation of having the highest death rate of road accidents in proportion to population of any country in the world.

Senator McLEAY:
LP

– I presume that the honorable senator seeks information from both the Commonwealth and the States, That information is available, and if she will be good enough to place the question on the notice-paper I shall see that she receives a reply as soon as possible.

page 610

QUESTION

WATERFRONT EMPLOYMENT

Senator ASHLEY:
NEW SOUTH WALES

– Has the Minister for Shipping and Transport seen the photograph in this morning’s Sydney Morning Herald of congestion on the waterfront in the port of Sydney, and the statement that the congestion has been caused by the consignees using the wharfs as stores? Is the Minister prepared to limit the time that goods may be left on wharfs without penalty, as was done by the previous Labour Government? Is there any particular reason why this action has not already been taken?

Senator McLEAY:
LP

– At a conference thatIattended to consider this matter it was decided that the introduction of the 40-hour working week by the previous Labour Government was one of the main reasons for the congestion. In any case, matters relating to wharf sheds and facilities are under the jurisdiction of the Maritime Services Board of New South Wales which, in turn, is responsible to the Government of that State. The Sydney Cargo Clearance Committee, which was established to look into this matter, is doing its best to clear the congestion. An exceptionally large number or ships is now arriving from overseas, and inwards cargoes have greatly increased since this Government has been in office. We are hoping that the position will right itself within a few days.

page 610

QUESTION

REPATRIATION

Senator COOPER:
CP

– On the 27th June, Senator Tangney asked the following question : -

Will the Minister for Repatriation inform me what facilities are available at repatriation general hospitals for the out-patient treatment of war widows? Can war widows and their dependants receive medicaltreatmentby specialists on the panel of doctors of the Repatriation Department? May a war widow exercise a choice of specialists for consultation without being an in-patient of a repatriation hospital?

Facilities are not available at repatriation general hospitals for the out-patient treatment of war widows or other eligible dependants of deceased members of the forces. However, out-patient treatment is provided by general practitioners in private practice, under an agreement between the British Medical Association in Australia and the RepatriationCommission. Beneficiaries, for this purpose, may choose, from a panel of practitioners, doctors who practise near the places of residence of the beneficiaries. The doctors may prescribe on the requisite departmental form, medicaments for dispensing by any practising pharmacist, at the expense of the Repatriation Commission. While the beneficiaries are inpatients of’ a repatriation general hospital, treatment by visiting specialists of the institution is provided as required, [n instances where a doctor is of the opinion that spectacles should be supplied as part of active remedial treatment, examination by an eye specialist is usually arranged, whether or not the patient be in hospital. Beyond that, outpatient treatment by specialists is not provided. The free choice of a specialist for- consultation by dependants of deceased members is not permitted.

page 611

QUESTION

TELEPHONE SERVICES

Senator CRITCHLEY:
SOUTH AUSTRALIA

– Can the Minister representing the PostmasterGeneral say whether his colleague is aware that the many persons, including ex-servicemen engaged iri business, are awaiting the installation of telephones and that the installations have not been made owing to a shortage of labour? What steps have been taken by the Government to avoid extra delay in the installation of telephones as a result of the recent- dismissal, of technicians from the Postal Department? Is it a fact that telephone equipment that was ready for installation has been crated and returned to store?

Senator COOPER:
CP

– I shall be pleased to bring to the notice of the PostmasterGeneral the matters that have been raised by the honorable senator and obtain a. reply for him as soon as possible.

Later:

Senator COOPER:
CP

– On the 27th September, Senator O’Byrne asked the following question, upon notice: -

  1. Is the Minister representing the PostmasterGeneral aware that there are 4,000 outstanding applications for telephone connexions in Tasmania, and that some of the applicants have been waiting for installations for periods of up to four years?
  2. Is he also aware that because of shortage of stuff, extensive amounts of overtime have been worked by the line staff during a long period ?
  3. Does the Minister know that the I5mu Bay railway in the far north-west of Tasmania i=* the alternative essential employment being offered to Tasmanian linesmen who have been dismissed in accordance with the retrenchment policy of the Australian Government, and thai such positions have been picked over and in many cases declined as unsuitable by new Australians?
  4. Will the Minister advise applicants foi telephones that it is unlikely that telephone connexions will be made because of the change of policy of the Government and that line staff who have been employed in making such connexions are now being dismissed?

The Postmaster-General has supplied the following answers : -

  1. Due to equipment and line plant shortages, 3,075 applications for telephone service have had to be deferred throughout Tasmania. In addition, 582 applications are in course of being fulfilled. It is true that, in some cases, applicants have been waiting for services for periods of up to four years.
  2. Due to the shortage of certain classes oi skilled man-power, it has been necessary to have some officers work overtime in accordance with the conditions of their arbitration award*in order that the connexion of telephone services might proceed as rapidly as possible.
  3. The Postmaster-General has no knowledge of the nature of any alternative employ ment which has been, or may be, offered to staff who have ceased employment in his department.
  4. Each applicant for a telephone service iiadvised as soon as possible of the condition*, obtaining in the particular exchange area in which service is sought and of any special circumstances bearing on his application.
Senator COOPER:

– On the 26th September, Senator Ashley asked the following question : -

In view of the fact that according to press reports, the dismissal of 4,000 employees of the Postmaster-General’s Department under the Government’s retrenchment scheme will further delay the provision of new postal facilities and telephone services - I understand that 00,000 applicants are awaiting, new telephone installations in New South Wales alone - will the Minister representing the PostmasterGeneral urge his colleague to consider an extension of the duplex system to subscribers now enjoying private services? Many people who to-day are deprived of telephones could secure an early installation by agreement with’ subscribers in the same locality. An extension of the use of duplex lines before the retrenchment of postal employees begins would enable deserving applicants for telephones to be connected much sooner than would otherwise be possible.

The Postmaster-General has now furnished me with the following reply : -

Any general extension of the duplex system of telephone services to persons at present served by individual lines, as suggested by the honorable senator, depends on technical and other considerations which the department is at present, examining with a view to securing further data on which its future policy might be based.. At the same time the development of duplex services is proceeding as rapidly as circumstances will permit. Since the system was introduced about the middle of 1949, more than 13,000 duplex telephone services have been installed, mainly in Sydney and Melbourne, where, due to the heavy demand for services available, line plant is must congested. During the same period approximately 191,000 ordinary telephone services were installed throughout the Commonwealth. For some time the difficulty in securing supplies of duplex equipment retarded the development of this class of service, but more recently improved progress has been made, approximately half of the duplex installations now in service having been provided since the end of 1950. In Sydney and Melbourne, at present nearly 25 per cent, of new exchange connexions are being made available under duplex conditions. Duplex telephone services can be provided only at automatic and common battery exchanges where there is accommodation for additional equipment required for such services. Moreover at these exchanges duplex facilities are necessarily restricted to installations having low calling rates, usually residence services. To conserve the duplex equipment for areas where there is line plant congestion, duplex services are not usually provided at present for residents of localities where spare line plant is available. As more than one-third of the total connexions made since December, 1950, wore at magneto exchanges which are not suitable for duplex installations, and as, for the reasons already explained, the scope for the provision of duplex facilities is limited at many of the automatic and common battery exchanges where the balance of the connexions were effected, it is considered that satisfactory progress is being made in the installation of duplex services under the existing scheme.

page 612

QUESTION

NATIONAL SERVICE

Senator ASHLEY:

– I ask the Minister representing the Minister for Defence whether’ his colleague arranged to inspect yesterday youths who are undergoing national service training and that he extended to New South Wales members of the Liberal party and the Australian Country party in the Senate and the House of Representatives invitations to attend the inspection? Did only two members of the Senate and two members of the House of Representatives take advantage of the invitations? According to a report in to-day’s Sydney Daily Telegraph, one of the members of the House of Representatives ,who was sufficiently patriotic to attend the inspection, namely, Mr. Treloar, said that he was surprised that members of the Labour party had not attended. I suggest to the Minister that, if a similar inspection be arranged in future, he ask- his colleague to extend invitations to members of the Labour party in the Parliament. I am certain that my colleagues would exhibit more patriotism than did the members of the Government parties who were invited to attend the inspection yesterday, but did not do so.

Senator SPOONER:
NEW SOUTH WALES · LP

– I do not know whether invitations to attend the inspection were extended to all New South Wales members of the Government parties. I can speak only for myself in this matter. If what the honorable senator has said were correct, I should have thought that, being a representative of New South Wales in this chamber. I would receive an invitation to attend inspection, but I did not receive one. I know that the Minister foi” the Army is eager that as many members of the Parliament as possible should inspect the national service trainees in camp. He is justifiably very proud of the conditions that the youths are enjoying in their camps and of the efficient way in which they are carrying out their duties. I am certain that the Minister would go to any reasonable length to give the honorable senator an opportunity to see the youths in camp.

page 612

QUESTION

VEGETABLE SEEDS

Senator SHEEHAN:

asked the Minister for Trade and Customs, upon notice -

  1. Is it a fact that permission has been granted to import beau seed from Tanganyika, South Africa?
  2. If so, (o) why was such permission granted; (6) was any inquiry made as to whether Australian bean seed growers were able to fulfil all orders received by them ; ami (c) what is the difference in price of the imported bean seed landed in Australia and that charged to the Australian consumer?
Senator O’SULLIVAN:
LP

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

  1. Bean seed from Tanganyika is a normal import into Australia and except for the usual quarantine inspection no special permission necessary for its importation. In common with imports from other countries in the sterling area import licences are not required. 2.(a)and (b) See No. 1. (c) It is not the practice to disclose to a third party any- information relating to an importer’s business with the Department of Trade and Customs.

page 613

QUESTION

TAXATION

Senator FRASER:
WESTERN AUSTRALIA · ALP

asked the Minister representing the Treasurer, upon notice -

What amount was owing by (a) overseas residents, and (b) Australian residents, as at the 30th September, 1949, and as at the 30th June, 1951 ?

Senator COOPER:
CP

– The Treasurer has supplied the following answer to the honorable senator’squestion: -

It is assumed that the honorable senator’s question relates to income tax outstanding. As a dissection of the amount of tax outstanding on a residence basis is not made, it is not practicable to supply figures separately in respect of overseas residents and Australian residents. The total amounts of income tax (including war-time company tax) outstanding at the dates mentioned were approximately - 30th September, 1949, £40,705000; 30th June, 1951, £ 56,508,000. I should mention that there is normally a considerable difference between the amount outstanding at the 30th June of any year as compared with the 30th September. “ For example, at the 30th June, 1949, the approximate amount of income tax and war time company tax outstanding was £55,096,000.

page 613

QUESTION

HOUSING

Senator REID:
through Senator Maker

asked the Minister representing the Minister for Social Services, upon notice -

  1. in view of the increased cost of home building in Australia, will the Minister consider increasing the amount now made available by loan to war service homes applicants?
  2. In giving consideration to this question will he treat it as urgent so as to relieve the anxiety of many ex-servicemen who now find themselves in a rather embarrassing situation ?
Senator SPOONER:
LP

– The Minister for Social Services has supplied the following answer to the honorable senator’s question : -

This question has received the very close attention of the Government for some time, but a decision had to be related to the many important economic problems with which Australia was faced. The honorable senator now knows that the Government proposes to increase the loan for building under the act to £2,750 but it does not propose any increase of the amount of theloan for the purchase of existing properties. The reasons for this arc given indetailin my second-reading speech for the hill which has been submitted to Parliament.

page 613

DRIED FRUITS CONTROL BOARD

Annual Report

Senator McLEAY:
LP

– Pursuant to section 28 of the Dried Fruits Export Control Act 1924-1938,I lay on the table the following paper: -

Twenty-seventh Annual Report of the Dried Fruits Control Board for year 1950-51, together with statement by Minister regarding the operation of the act.

The Australian dried vine fruits industry has experienced another year of excessively low production, the 1951 season’s pack of dried currants, sultanas and lexias being estimated at 55,000 tons. The average annual production during the past three seasons has been approximately 56,000 tons, which compares most unfavorably with normal output. This has resulted in a severe curtailment of exports to all overseas markets.

As is indicated in the report there has been a review of the contract prices in respect of shipments to the United Kingdom this year. The new contract prices - currants £75, sultanas £100, lexias £100, English currency, per ton f.o.b. - represent substantial increases on the prices received for shipments to the United Kingdom in past years and have been welcomed by the industry.

page 613

TARIFF BOARD

Reports on Items.

Senator O’SULLIVAN:
LP

– I lay on the table reports of the Tariff Board on the following items : -

Linseed.

Assistance to the Wine Industry.

Copies of the reports are not yet available for circulation to honorable senators.

Ordered to be printed.

page 613

ESTIMATES AND BUDGET PAPERS 1951-52

Consideration resumed from the 26th September (vide page 30), on motion by Senator Spooner. -

That the following papers be printed: -

Estimates of Receipts and Expenditure, and Estimates of Expenditure for Additions, New Works and other services involving Capital Expenditure, for the year ending 30th June, 1952;

The Budget 1951-52 - Papers presented by the Right Honorable Sir Arthur Fadden on the occasion of the Budget of 1951-52 ;

National Income and Expenditure 1950-51

Senator AYLETT:
Tasmania

– I have no doubt that whatever is said by honorable senators on this side of the chamber it will not change the course of the budget, which has been attacked and torn to pieces iii the House of Representatives. This Government has lost the confidence of the people because it takes orders from an outside source. Because the Government has not acted on its own initiative in presenting the budget, the Opposition is obliged to offer some comment concerning it. In mentioning the name of Sir Douglas Copland, [ do not wish to lead anybody to believe that I desire to detract from his outstanding ability. It is obvious that Sir Douglas is so versatile that on receiving a request from any government or organization he is able to detail to it the policy that it should follow. I point out that there is a great deal of similarity between the policy represented by the budget proposals and that of the Premiers plan in 1.930. By a strange coincidence a little more than a week ago Sir Douglas Copland made a certain announcement in the Melbourne Herald. Earlier, he had announced, through the columns of that newspaper, what the policy of the Government would be. “We all knew what was coming. For three weeks before the budget was introduced Sir Douglas Copland had been publishing in the Melbourne Herald, articles in which he foretold the main features of the budget. Surely enough, everything that he prophesied was duly found in the budget. Sir Douglas Copland has claimed that what was subsequently known as the Premiers plan was originally the Copland plan, and he has explained to us how economically sound the Premiers plan really was. Now he is explaining how economically sound is the present budge: [n this I differ from him. I cannot agree that the Premiers plan, which brought bankruptcy and ruin to so many business people and farmers, which plunged so many hundreds of thousands of people into starvation, degradation and poverty, and which drove some of them to suicide, nan be regarded as economically sound.

I do agree, however, that there is a good deal of similarity between the present budget and the Premiers plan.

This budget is so economically unsound that the Government has lost the confidence of the people. Not long ago the Government boasted that it would stop inflation. Now it brings down a budget which must have the effect of aggravating inflation. Indeed, it is producing inflation by act of Parliament. The action of the Government, in increasing sales tax and excise duty, must automatically increase prices, and so add to inflation. When prices rise the purchasing power of the people is reduced, and the standard of living declines. It if against all reason to suggest that inflation can be cured by raising prices.

That the Government has forfeited the confidence of the people is proved by the fact that the last Commonwealth loan was under-subscribed. All during the war, and during the post-war period under a Labour Government, Commonwealth loans were always over-subscribed. Commonwealth bonds have also declined in value. Bankers have been in the habit of telling their clients to invest their money in Commonwealth securities because they are safe. The Government has spent thousands of pounds on advertising in the press, urging the people to invest their savings in Commonwealth bonds. Both the bankers and the Government told investors that it was the part of wisdom to invest in government securities because their money would always be safe ; that if they had to realize on their investments they would get their money back in full. Now, bankers are forced to tell their clients that they gave unsound advice, and that the bonds for which they paid £100 each will realize on the market £7 less than was paid for them.

Once more this genius, Sir Douglas Copland, has been giving prior advice of Government policy. He has stated that the only way to stabilize the nation’s economy is to increase interest rates. We know that if interest rates are increased the cost of production must also rise. Most industries are working on borrowed money, and interest and dividends have to come out of profits. Honorable senators on both sides of the chamber have warned the Government of the need for increased primary production. There is need, it is pointed out, to put nine men on the land, but if interest rates are increased the cost of putting men on the land will increase also. We remember that in .1928 a farmer who borrowed money with which to finance the purchase of land had to pay up to 8 per cent for it. Now, Sir Douglas Copland is urging a return to a similar state of affairs. He has told the people that future Commonwealth loans will have to be issued at a higher rate of interest. Once people believe that the interest rate will be increased, what chance is there that they will subscribe to loans at thi? existing rate of interest ? It is no wonder that Commonwealth bondholders are trying to cash their bonds so that they may have the money to put into new loans at 5 per cent, or 6 per cent, interest. The more Sir Douglas Copland warns the people in advance of Government policy, the more the people distrust the Government, and the worse the economy of the country will become.

He was not ‘content with the publicity that had been given to his statement in Australia and so he repeated it to representatives of the overseas press, reiterating that it was economically sound in the present circumstances for the present Treasurer (Sir Arthur Fadden) to budget for a surplus of £114,600,000. How can he claim that it is economically sound to budget for such a surplus when he knows that the money must come out of the pockets of the people whose standard of living has already fallen as the result of the policy of the present Government? Sir Douglas Copland evidently believes that the more the living standards of the people are lowered, the more stable our economy will be. I can place no other interpretation upon his words. The. budget surplus must be provided by the people in increased direct taxes and in higher commodity prices that result from the imposition of heavy increases of sales tax, customs and excise duties.

What is the .reason behind the Government’s decision to budget for a surplus? We have been told that a surplus is necessary in order to meet the contingency that future loans may be undersubscribed. In effect, Sir Douglas Copland has said that a budget surplus is necessary because the people have lost confidence in the Government. It has been said that if, as is predicted, future loan issues fail to be fully subscribed, State works programmes may bc even more rigidly curtailed than they are at present. Thus, the Government and its chief economic adviser frankly admit that they do not enjoy the confidence of the people. Has such a frank admission ever previously been made by a government? The ordinary man in the street, the basic wage earner and the girl employed in an office will all be called upon to pay the price of this lack of confidence in the Government. Each W1 contribute his or her share to the budget surplus so that the Government may meet any undersubscription of its future loan issues. If that is not so, why has the Government budgeted for such a large surplus? There can be only one other reason why it has done so. A statement was made in another place by the notorious Treasurer that money is safer in the keeping of the Government than in the pockets of the people, many of whom have to go without much-needed furniture and are unable to buy boots and shoes for their children because of the demands made upon them by the Government. Most of the money that will be contributed to provide this proposed surplus would not be spent willy-nilly on luxuries. Most of it will be provided by people on moderate incomes who have no surplus spending power. The steep increases of taxation proposed in this budget will deprive the family nian of many of the comforts of life to which he is entitled. The Treasurer, in effect, has said to him “ You should be able to get along with less money; you must give ane more than you have given me in the past; I shall keep it in the Treasury because I know what should be done with it and you do not “. Having collected the additional money from the wageearner and the family man the Treasurer will probably immediately put it back into circulation and thus inflation will increase. The right honorable gentleman has said to the worker, in effect, “ Yon m’ust deprive yourself of same of the necessaries of life because we know what should be done with your money better than you do “. The proposal to budget for a surplus is nothing - but legalized robbery. The Government does not need to take additional money from the people in that way. If it pursued a sound economic policy the person with money to invest would freely subscribe to government loans. Proof of the truth of that statement is to be seen in the records of the past. Over the years when governments have pursued a sound economic policy, government loans have invariably been either fully subscribed or oversubscribed.

Sir Douglas Copland, who is the economic adviser of the present Government, and announces its policy in advance, was also economic adviser to a Labour government, but he was told by that government in clear terms what its financial and economic policy would be and he advised it in accordance with the terms of that policy. If he had not done so he would have quickly been told that his advice was not wanted. It can be assumed, therefore, that the advice that he gives to the present Government is in consonance with its economic and financial policy. The Government must share his economic views or it would reject his advice. We cannot blame Sir Douglas Copland for the distrust of the Government that has been manifested by the people. The Government itself must accept full responsibility for its financial and economic policy.’ Members should have sufficient intelligence to show whether advice given to them by Sir Douglas is sound or otherwise. This budget represents a small- scale application of the Premiers plan, which was proved to be economically unsound in the past. For all we know the next budget may apply that plan on a major scale. It is certain that it will do so if Sir Douglas Copland is still advising the Government when the next budget is drafted. Once again the people will be told that they must tighten their belts. They have already begun to tighten their belts since the present budget was introduced. If the Government expended its revenues wisely ‘ the people would rally to its support.

Early this year the Prime Minister (Mr. Menzies) warned us that war was inevitable within two years.

Senator Spicer:

– He did not say that .

Senator AYLETT:

– I can well understand members of the Government denying that he made such a statement,, because they are only continuing their policy of reversing the views that they expressed less than two years ago. I do not propose to discuss in detail the- ‘ Government’s reversals of form becauseI could not possibly deal with all of them in the one and a half hours that is allowed to me for this speech. I shall refer specifically to an example of waste of public money. Three months ago, I asked in this chamber what costs had been incurred by Sir Edmund Herring’srecruiting staff. On the 26th October, the Minister representing the Minister for Defence announced that he had a lengthy answer to my question, and asked for leave of the Senate to have it incorporated in Hansard. Like “ Innocent Willy” I agreed to the request, not realizing what his statement contained. However, when I read it, I realized that the Minister had been eager to avoid’ having to broadcast the answer because it contained an amazing collection of facts and figures. It revealed that between the 1st of October, 1950,’ and’ the 30th June, 1951 - approximately eight months according to my calculations, although possibly Professor Sir DouglasCopland would estimate it at 28 months - the total cost of the Government’s recruiting campaign had been £385,000. Of that total, the press of this country, which, despite its hostility to this budget is always the mouthpiece of the Liberal part.r and the Australian Country party,, received £256,000, and the expenses incurred by Sir Edmund Herring and his small staff - it could not have been verybig because the recruiting organizationsin the States consisted of honorary officials- totalled £25,778. The expenditure incurred in rents - I do not know of what premises - amounted to £4,832, and “ incidental expenses “ totalled’ £54,000. Surely that is a matter which’ could well be investigated by the AuditorGeneral. I repeat that the total expenditure incurred in the recruiting campaign exceeded £385,000.

Senator NASH:
WESTERN AUSTRALIA · ALP

– And how many recruits were enlisted?

Senator AYLETT:

– There were 19,8S4 enlistments, and I venture to say that at least 18,884 of those would have joined the forces even if Sir Edmund Herring had never been appointed to organize the recruiting campaign. In other words, the additional 1,000 recruits were secured at a cost of £385 a head. When the people of Australia see this going on, is it any wonder that they lose confidence in their Government? While Sir Edmund Herring and members of his staff were incurring the substantial expenses to which I have referred, the unfortunate recruits found that when they wanted to go home on leave, they had to pay £2 15s. for the return journey if they lived 100 miles from the camp, and more than £3 if they lived 150 miles from the camp. That is the treatment that has been meted out to the gallant boys who enlisted voluntarily or were called up for military service.

The Minister representing the Minister for Defence would not speak in such glowing terms of how satisfied our servicemen are with camp life if he had visited some camps when the recruits learned that they would have to pay their own fares to and from their homes when on leave. We have been told that everything is harmonious in our military camps. I do not say that the trainees are not happy, that we do not need armed forces, or that this country should not be defended, but surely if a lad is good enough to be conscripted into the services, he is at least good enough to have a say in determining what government should hold office in this country. At present, that right is denied him. Recently, I asked the Minister for the Interior (Mr. Kent Hughes) whether he would be prepared to extend adult franchise to the eighteen-year-old conscripts. The Minister’s answer was a point-blank “ Ho.’”. He said he did not think that such a move would be justified, but he did believe that men who enlisted for overseas service should have adult franchise. In other words> his view is that whereas men who ;are prepared to go to Egypt, Irak, Persia, or anywhere else in the world to fight, should have a vote, servicemen who are prepared only to give their lives in defence /of their own country are too degraded, not sufficiently intelligent, or have not proved themselves men enough, to be given such a privilege. That is the kind of Government we have to-day! It is quite prepared to conscript the youth of this country to fight, and die if necessary to prevent the Government from being blasted out of office by an enemy, but it does not believe that the conscripts are entitled to a vote. Is this a democracy? When we speak of a democracy, surely we must mean a country that is prepared to give to those of its citizens who are to be called upon to carry the heaviest burden in time of national crisis, the same rights and privileges as are enjoyed by other citizens. Will any honorable senator opposite deny that a man who is prepared to lay down his life in defence of his country should have a voice at election time? Any Government supporter who expressed such a view would fall considerably in my estimation, and, of course, any honorable senator opposite who held the contrary opinion would immediately find himself in conflict with the Minister for the Interior.

The £385,000 which the Government has needlessly expended on its recruiting campaign could much better have been devoted to the settlement of ex-servicemen on fertile land which to-day is not productive because of lack of development. In that way, the Government could have done much to regain the confidence of the electors. Admittedly, the Government, in co-operation with the State governments, is carrying out soldier settlement schemes in various parts of the Commonwealth, but the land that has been acquired for that purpose so far is a mere bagatelle. Land settlement schemes embracing a mere 5,000 or 6,000 acres are of little use. Those areas should be extended to at least 20,000 or 30,000 acres. I know of localities where that could be done quite easily. If commodities such as butter and meat are to be produced, i* is necessary to have slaughter-houses, cold stores, &c, and the provision of such facilities to serve small settlements would be uneconomic. When large tracts of land are available in good rainfall areas, why play with insignificant resumptions ? Let us do something really worthwhile to increase production, which, as honorable senators opposite are beginning to realize, is lagging alarmingly. This Government, in conjunction with the Tasmanian Government, has undertaken to develop a small area in one of the richest parts of Tasmania. I consider that an area ten times as large should be developed, and that provision should be made for the establishment of slaughter houses and freezing works in the future. The sum of £385,000 that has been more or less thrown away by the Government, on the recruiting campaign that has been conducted by Sir Edmund Herring could have been more profitably expended in this manner. There is an urgent need to increase food production. Almost every day economists are pointing out in newspaper articles the danger facing Australia in this connexion. If the Government sincerely wants to protect the people of this country it should make available to suitable applicants tens of thousands of acres of land to increase food production.

During question time to-day one of my colleagues asked whether the Government intended to take big estates away from their present owners. I know that the owners of many big estates would be only too willing to hand them over to the Government for a reasonable price. If the Government does not take constructive action in this way, there is nothing surer than that it will be defeated at the next general election and Labour will then have to implement a vigorous policy along the lines that I have mentioned. Although Senator Scott may smile, many thinking people will agree with me that although the Government may retain a majority in this chamber it will be in a minority in another chamber. The people have already given an indication of their thoughts in this matter.

Senator Spicer:

– When?

Senator AYLETT:

– That is obvious from the failure of the recent Commonwealth loan and the declining value of Commonwealth bonds on the open market. Furthermore, the people “ wiped “ the Government’s recent referendum proposal, which was tantamount to a vote of no confidence in the Government. Already the people are well and truly “ fed-up “ with this Government.

Senator SPICER:
LP

– The referendum proposal was carried in 68 divisions.

Senator AYLETT:

-The Government failed to obtain a. favorable vote in a majority of the States -and by a majority of the electors. Sir Douglas Copland is playing the role of dictator to the Government. It is problematical whether the Government acquiesces in the policy that he is enunciating.

Postal employees are being dumped on the scrap heap. Although many applications for telephone services are still outstanding, linemen and other technical staff of the Postal Department are being sacked. Yet, when members of the publichave inquired why postal services have not been increased, invariably the reply has been that there is a serious shortage of labour in the Postal Department. The Government cannot have it both ways. The Government has increased postal charges in the belief that postal business would decrease and that the reduced staff would be able to cope with it. Although the Minister for Repatriation (Senator Cooper) could readily have obtained for Senator Willesee an answer to a question relating to a comparison of the number of telegrams that were transmitted in July and August, 1950, and in July and August this year, he did not do so. I am convinced that after the first batch of telephone accounts reflecting the increased charges are sent out, there will, be a marked decrease of telephone business. By increasing telephone charges the Government is reducing the demand for telephones. Quite possibly many telephone subscribers will relinquish their telephones, while many people who have been waiting for telephone installation? will be less keen to obtain the service in view of the increased charges. As honorable senators are aware, the telephone if probably the best profit-earning facility controlled by the Government.

Senator Cormack:

– What about bookmakers?

Senator AYLETT:

– It would seem that Senator Cormack has had some experience of bookmakers. Had the Government extended the telephone service and not increased the charges, revenue would have increased. At least it would have been much, greater than it will he in view of the restricted service and the heavy increases of costs.

Senator Scott:

– How does the honorable senator account for the increase this year compared with last year ?

Senator AYLETT:

– One only needs common sense-

Senator Scott:

– To run a gold mine?

Senator AYLETT:

– The honorable senator who has just interjected would be better employed working in a gold mine than interjecting stupidly. I protest emphatically about the Government’s callous dismissal of men who are needed to attend to urgent installations. People who have been waiting for more than three years for a telephone to be installed in their homes have in many instances received letters from the Postal Department explaining that the delay was due to shortage of labour. How can the Government expect to prosper if it continues to pursue a policy that will put us into reverse gear ? Maintenance work is lagging. Work that should have been carried out in the ‘thirties has not yet been attended to. The Government should continue developmental works. Although the Government is budgeting for revenue of over £1,000,000,000 the contemplated expenditure on defence this financial year is a bagatelle. How can honorable senators opposite convince the people of this country that the huge surplus that has been budgeted for is required for defence purposes? Only £180,000,000 will be expended on defence. Excluding that expenditure, the budget will be much larger than was any war-time budget in this country, and greatly in excess of the amount of the budget at the height of the recent world war. Most assuredly, the people will want to know from the Government at the end of this financial year how the sum of over £1,000,000,000 that it is proposed to take from them has been expended. I cannot agree with the Prime Minister’s statement that no essential works have closed down. [ claim that essential works have closed down. I remind supporters of the Government that they cannot hoodwink the whole of the people all the time, although they may do so for some time. I am convinced that this Government will soon be forced out of office. The budget is economically unsound in every way. In the notfardistant future this Government will be removed from office and Labour will have to clean up the mess that the Government is now making.

Senator COOPER:
Minister for Repatriation · Queensland · CP

– I have listened with a great deal of interest to Senator Aylett’s address, in which he has displayed a lack of responsibility as a member of this chamber. I shall cite instances of his irresponsibility. This budget has been brought down to counter inflation. I am sure that honorable senators opposite agree that steps should be taken to counter the present inflationary tendency. I point out to honorable senators opposite that Australia is not the only country that is going through a period of inflation. The United State? of America, the United Kingdom and many other countries are facing a similar situation. This Government would fail to discharge its duty to the Australian people if it ‘ did not take all possible steps at its disposal to counter inflation. That is the reason why the budget contains some proposal? that are, to some degree, unpopular. No one will deny that the world is in a very sorry state, and that in many instancesthe position is becoming worse from day to day. We are engaged in a war in Korea. Our forces are fighting there. There is war in Indo-China and in Malaya. Surely no one will deny that the position in the Middle East, especially in Egypt and in Persia, is worse now than it was even three months ago. Does the Opposition suggest that the Government should stand by complacently and say that what is happening in the outside world has nothing to do with Australia? The isolation that was our defence 40 years ago has now disappeared, and this country is as open to swift attack with modern weapons as is the United Kingdom.

The budget must be considered against that background. Australia is not the only country in the world that has had to budget for an astronomical expenditure. The United Kingdom, the United States of America and New Zealand, realizing that they have certain responsibilities, are making provision in their budgets for tremendous expenditure to establish their defences and to prepare themselves for an onslaught that may be launched against them at any time. When this budget was presented to the Parliament, the general opinion was that public reaction to it would be strongly unfavorable to the Government, but unfavorable comment has decreased from day to day as the people have come to realize that the budget is not extravagant but sound, and is one that any responsible government would have formulated in the present circumstances. The Government, by its handling of the present position, has increased the respect in which it is held by the public. Many people were relieved to find that the budget was not so harsh as they had expected it to be.

Senator Fraser:

– Is the Government prepared to go to the country on it?

Senator COOPER:

- Senator Fraser will have his say later. I am having mine now, and I am determined to have it. Naturally, there has been dissension about some aspects of the budget, because some people feel that they may get a rough spin, but, by and large, the Australian people regard it as being sound.

Taxes have been increased. Senator Aylett said that they should be reduced. 1 invite honorable senators opposite to say where expenditure could be reduced. We have budgeted for a revenue of approximately £1,040,000,000, and it has been estimated that expenditure this vear will be £927,000,000. Therefore, there will be a surplus of between £113,000,000 and £114,000,000. The Opposition has objected strongly to the policy of budgeting for a surplus, but if taxes were not increased and if revenue this year were approximately the same as last year, expenditure would exceed revenue by £46,000,000. Doubtless, honorable senators opposite agree that there is some degree of inflation in this country. Do they suggest that the Government should increase the inflationary pressure by budgeting for a deficit, which would involve seeking additional money from the loan market or issuing treasury-bills? The issue of treasury-bills would be a grossly inflationary procedure. Honorable senators opposite must make their choice. If they say that the Government should reduce taxes, they are in favour of increasing the inflationary pressure. Thi* Government will not do that. It will endeavour to check inflation.

Let us examine the items of expenditure. It may be said that the Government should examine them one by one and consider whether reductions could be made. That examination has been made, and, wherever possible, the items have been reduced. Does the Opposition, suggest that expenditure should be reduced upon social services, repatriation,, defence, subsidies, war service homes, or the provision of houses under the Commonwealth and State housing agreement? Expenditure upon each of these items will be considerable. Is it suggested that expenditure upon capital works and administration should be reduced? Senator Aylett said that more money should be expended upon capital works. In general, the capital works upon which the Commonwealth is engaged, are designed to provide the power that is so essential for industry. It has been estimated that expenditure upon Commonwealth public works this year will be £106,000,000, or £4,000,000 more than last year. During the last twelve months, the cost of materials and labour has increased considerably, and the increase will more than offset theexpenditure of an additional £4,000,000- this year. It is apparent that no reduction of expenditure upon Commonwealth, public works can be made. Expenditure upon administration during this financial: year will be approximately £45,000,000. Do honorable senators opposite suggest that that should be cut? Do they suggest that the Government should reduce the strength of the Public Service further? Are they in favour of the dismissal of another 5,000 public servants?

Senator Critchley:

– Was the honorable senator right in 1948, or is he right now?

Senator COOPER:

– The position in- 1948-49 was entirely different from the present position. If wages were increasing now only at the rate at “which- they were increasing in 1948-49, we should be in a comparatively happy position.

Senator Critchley:

– Wages were rising in 1948-49.

Senator COOPER:

– The rate of inflation now is greater than it was in 1948-49. The Government recognizes that that is so. Let us examine the cost of the States’ works programmes. It is well known that, as a result of the war, there is much leeway to be made up in that connexion Although our railways were operated at high pressure during the war, practically no maintenance was done upon them then. Therefore, there is a great back-log of maintenance work to be done. The States are engaged upon projects for the production of power which they consider to be essential for the development not only of their own territories but of the whole of Australia. Is it suggested that the works programmes of the States should be cut down further? I remind honorable senators that they have been reduced from approximately £350,000,000 to £225,000,000, which is the amount at which they stand to-day. With a States programme of £225,000,000 and a Commonwealth pro.grame of £106,000,000, the Government is immediately faced with the necessity to find £331,000,000 by means of its budget proposals. Senator Aylett and other honorable senators opposite may say, “You will be able to obtain a certain amount from loans “. It has been the practice in the past, where public works have been in the nature of assets, to finance them from loan funds. That procedure is in order, and if loan funds are available, the Government intends to follow it in regard to future State works programmes. However, the Government intends to finance the Commonwealth works programme from Consolidated Revenue. I nm sure that all honorable senators will agree that if the Government is not able to find, by means of loans, the £225.000,000 required for States works it should not say to the States, “You must default or immediately cut down yOUr works programmes in order to make them fit exactly the amount of money obtainable from the loan market “.

The Government has looked ahead. To prevent the States from being obliged to default, the loan programmes have already been underwritten to the extent of £100,000,000, which means that if the loan market supplies only £125,000,000 during the next twelve months the Australian Government will be obliged to pay to the various State governments £100,000,000 in order to ensure that their works programmes will be carried out. Far from being wrong, I suggest that the procedure shows that this Government visualizes the essential development of the country and the difficulties that may occur during the next twelve months in the loan market. The position may entirely alter, of course, and loan funds may be available to cover deficiencies in the financing of State public works programmes.

It is well to consider other expenditure of a constant or irreducible kind if we intend to carry out our contracts. All honorable senators are aware that under the system of uniform taxation the States are entitled to a proportion of the taxation revenue of the current year. Their entitlement is calculated by means of a formula. The amount that will be payable to the States for the coming year is £161,000,000. Do honorable senators opposite suggest that that amount should be cut down by 5 per cent, or 10 per cent., or by any other percentage? It seems to me that as honorable senators are here to represent the States of the Commonwealth, they would be most averse to any cut being made in such payments. I have already mentioned that there is an underwriting liability of approximately £100,000,000 in connexion with State works. The Commonwealth works programme of £106,000,000 brings the total to between £336,000,000 and £361,000,000, according to the amount which this Government is called upon to supply because of deficiencies in the loan market. It will be seen that that figure represents one-third of the entire estimated expenditure for the year 1951-52. Yet honorable senators opposite continue to say that the Government is gathering in enormous sums of money for pleasure and that there is nothing on which to expend the money.

So far I have not dealt at all with expenditure on social services, repatriation benefits, defence, w.ar service homes, dousing, and many other heads of expenditure contained in the Estimates and Budget Papers. It can be seen, therefore, that when the total estimated expenditure of £927,000,000 is taken item by item, the only matters on which reduction of expenditure may perhaps be effected are such thing3 as administration, Commonwealth public works, State public works or the amount of taxation revenue to be returned to the States under the uniform taxation provisions. I am therefore led to believe that if the Opposition continues its insistence upon reduction of the estimated expenditure, it follows that it is in favour of reducing works programmes, reimbursement of the States, social services, or other amenities. This Government does not stand for that, [t believes that in presenting this budget the increased taxes have been spread amongst those who can well afford to meet them. Those in the greatest need will carry the least burden of taxation.

Senator BENN:
QUEENSLAND · ALP

– In what way 13 the budget anti-inflationary?

Senator COOPER:

– In the first place, the Government has not used, and does not intend to use, treasury-bills or anything of that kind. I think that Senator Benn will agree that the surest means of increasing inflation is the issuing of treasury,bills which are not backed by goods but which have only a paper backing. Treasury-bills increase spending power for goods that are already in short supply.

Senator Aylett referred to lack of confidence in the Government. I find that the reverse is true. The bulk of the people appreciate that this Government is tackling the economic problems of the country in a proper manner and is not frightened to tell the people what the real position is. The people also appreciate that the Government is seeking to introduce the necessary measures to counteract those problems. Senator Aylett linked the alleged lack of confidence in the Government with failure to fill certain loans. I remind the honorable senator that the amount of public capital invested in various undertakings in this country increased from approximately £109,000,000 in 1939 to approximately £405,000,000 in July, 1951. That is some explanation of the diversion of capital from investment in loans to investment in industry, which is paying a higher percentage return than government loans. We are all human. Many people look for what they consider to be the best investment available at the time - that which will give the greatest ‘return. It does not mean, however, that such an investment is better than investment in a government loan over a period of years, although better for a short time. There has been a much greater call for private investment during the last twelve to eighteen months than at any time during the history of this country.

Some items contained in the budget proposals have been criticized more severely than others. I wish to deal now with the proposed amendment of the averaging system which has been in force for many years in regard to primary production. I feel competent to do so. because from 1920 to the end of 194ft T was a primary producer myself, for most of that period being interested in the wool industry. During that time ] appreciated the great benefits of the averaging system. It was first introduced in 1920 with the specific purpose that primary producers would not have to stand up to variations of income from their products because of variations of climate and seasons. It was considered that a five-year averaging system, would provide them with a more stable income. During the period from 1921 till 1947-4S. at least, the variation in actual selling price was not great. In my own district of north-west Queensland seasons varied more than prices. At the present time there is a great deal of misunderstanding of the system, particularly among woolgrowers who have had the advantage of higher prices than those enjoyed by any other primary producers during the last four years. However, I consider that the Treasurer (Sir Arthur Fadden), who is the leader of the Australian Country party, understands fully the different methods of taxation and has a full knowledge of the averaging system and what it means to the individuals concerned. Surely his sympathy would be with the country people whom he has represented so well for many years. I have been in the wool-raising industry for some considerable time, and I believe that the growers are in a fortunate position. They have the right to sell their wool in the open market, and to get the full market price for it. During the last four or five years, prices have been extraordinarily good - better than any one would have thought possible ten years ago. The wool-growers are also fortunate in that they can sell the whole of their product on the world market at world parity prices, no part of it having to be sold at a home-consumption price, as with wheat, sugar, and certain metals. In common with other primary producers, the wool-growers have had the advantage of the averaging system in the assessment of income tax. During the period from 1939 to 1945 the average price of wool was 13½d. per lb., and the average wool cheque was £65,000,000. The figures for the period from 1943-44 to 1950-51 are as follows : -

Under the averaging system the growers have derived a benefit that was never intended when the system was introduced. It was then expected that prices would fluctuate a little, and that what the primary producers gained in one year the Treasury would gain in a subsequent year. I have no doubt that if the averaging system remained unaltered for a sufficiently long period the Treasury would eventually get back the £62,000,000 which it has lost by the operating of the averaging system over the last five or six years. In the past, when the price of wool fell, the growers suffered an additional hardship because they were required to pay out of a reduced income tax which was assessed on a higher income. A similar situation would arise in the future if the averaging system remained unaltered. If a wool-grower decides to withdraw permanently from the industry at the present time he will obtain a permanent benefit from the operation from the averaging system during recent years.

We cannot suppose that prices will remain as high as they are now. There have been booms before, and always they have been followed by a levelling-up period. If there should be a slump or, worse still, if there should be a succession of bad seasons, pastoralists who are now in a very sound financial position, would find that the averaging system of income tax assessment would place a tremendous burden on them.

The Treasurer proposes to introduce shortly a measure dealing with this matter, and he will explain his proposals more fully than I am able to do now. I have touched on them now because they concern a matter with which I have been familiar during the last 30 years. The wool industry has experienced difficult times as well as good times. The present extraordinary prices cannot last. Prices must come down and I, as a wool-grower, realize that the proposed amendment to the averaging system will be of benefit to growers in the future.

Much thought was given to the preparation of the budget by members of Cabinet and by departmental officers. In its final form, the budget was accepted by all members of the Cabinet, by members of the Liberal party and also by those of the Australian Country party. As a member of the Australian Country party I am proud of the budget. I have nothing to apologize for. Those who condemn it do so rather because they do not understand it than because of any real defect in the budget itself. I am confident that the budget will produce the effect at which the Government has aimed, namely, that it will conquer inflation.

Senator NASH:
WESTERN AUSTRALIA · ALP

– The Minister for Repatriation (Senator Cooper), in defending the budget, said that it was designed to prevent inflation. Whether or not it will do so I do not know. I am not a financial genius, but it seems to me that it has taken the Government a long time to realize the dangers of inflation. At any rate, it is pleasing to know that at last the Government is trying to do something about inflation. The Minister for Repatriation asked critics of the budget to say how expenditure could be reduced. Well, I suggest that the Government could cut the budget by deciding to get along without a surplus of £114,500,000. In addition, it could watch government expenditure much more closely than it has done in the past.

I agree that the international situation is such that we must be prepared to meet whatever may eventuate, and I am amazed that the Government has allocated no more than one-sixth of the total budget for expenditure on defence. During the war years successive governments budgeted for huge amounts of money for the prosecution of the war and for general governmental purposes. Having regard to the threat of another world war, and to the gravity of the events that are now taking place in certain parts of the world, one would have thought that in a budget that called for unprecedented sacrifices on the part of the people to guard against the contingency of war, and to cure the evil of inflation, the Government would make provision for heavy expenditure on defence preparations. The provision for defence in this budget represents only one sixth of the total amount that is to be collected from the people. I commend that observation to the consideration of Ministers.

The Minister for National Development (Senator Spooner) has said that honorable senators on this side of the chamber could reduce the amount proposed to be raised under this budget only by making stab reductions of the amounts proposed to be expended under the various heads of expenditure. He has invited us to state whether we are prepared to reduce the provision for social services. No ‘honorable senator would advocate a reduction of such expenditure however much he may differ from the Government in regard to some of the benefits now provided. One of them which comes instantly to my mind represents nothing but a political sop upon which expenditure of Government money is not warranted. I refer, to the unnecessary provision of a certain commodity for children, . the cost of which is to be borne by the taxpayers. . The national exchequer should not be ..burdened .with, the cost of un- necessary services of that kind especially when the people are well able to provide the commodity. No honorable senator would attempt to justify a reduction of the payments made by the Commonwealth to the .States.

The Minister’s challenge brings to my mind the manner in. which this country is governed. Australia, with a population of approximately 8,500,000 persons, is governed by a Commonwealth Parliament, with an upper and a lower chamber; six State parliaments, five of which have upper as well as lower houses; six State Governors and one Governor-General. Our governmental set-up, with its concomitant expensive duplication of services is too cumbersome and expensive for a country with such a small population to sustain. The people of the United Kingdom have one government to govern more than 44,000,000 persons. Admittedly, this country is large in comparison with the British Isles, but our system of government is .out of all proportion to our needs and to our financial resources. In the not distant future that state of affairs will have to be remedied. Economic trends throughout the world generally have resulted in- greater reliance being placed on the central system of government. The High Court of Australia has ruled that the Commonwealth Parliament has a prior right to impose taxes on the people. To-day the Commonwealth collects revenues for the States, but there is a tendency for it to dictate to the States how the revenues it collects for them shall be expended. The people of Australia are paying dearly for our expensive governmental system and the demand for reform is evident.

In this budget the Government has repeated the technique which it used so successfully against the wool-growers. Emboldened by its success in the- wool deduction scheme, and the .manner in which it got away with its demand on the wool-growers for the prepayment- of income tax, it has now decided to catch the whole of the taxpayers in its net and to demand greater contributions from them. By budgeting for a . surplus of £114,500,000 it is virtually saying to the- taxpayers, “ You have .-.too much money. We propose to take, some of it from you. We shall not set it aside as a prepayment of income tax, as we did with the wool-growers. We shall put it aside for safe keeping and use it as we desire.”

The budget has been described as :i courageous budget. I recall that long before it was introduced responsible Ministers and other persons associated with the Government made disclosures of some of its contents. I regard those disclosures as complete breaches of confidence. I have always understood that i t is a very serious offence for any person to make premature disclosures of budget proposals. Evidently the members of this government have a new concept of their responsibilities. These departures from accepted practice are very much to be deplored. Even the Prime Minister (Mr. Menzies) made a statement prior to the introduction of the budget that he was horrified by what that document contained. We are pleased that all the members of the two political parties that support the Government wholeheartedly approve of the budget. Unanimity of opinion is a desirable quality in all political parties and combinations of political parties. I trust that on this occasion that honorable senators opposite will be rewarded for their wholehearted support of the budget by the achievement of its stated desired result, namely, the end of inflation. I regard it as a “hit and miss’’ budget; it hits those in the lower income groups and misses those in the higher income groups. The truth of that statement is borne out by the imposition of a flat increase of 10 per cent, in income tax. The taxpayer who receives £5 a week will pay the same percentage increase as will the taxpayer who earns £100 a week. Admittedly, the taxpayer who receives the higher income will pay a larger amount than the taxpayer on the lower income, but the same proportionate increase will apply to both. Taxpayers in the lower income groups are not in a position to meet that additional increase. Increases of direct taxes should be imposed on a graduated scale based on the principle that those who are best able to pay should bear the heaviest percentage increases. In this budget the Government has departed from that very important principle.

1211

The Government also proposes to increase steeply the rate of sales tax on essential commodities. Those in the lower income groups will be most affected by the incidence of sales tax increases. Most of the commodities which they buy arc: subject to the higher sales tax rates. This Government has said to the people, “ In order to cure inflation we shall impose stiff charges on you for certain commodities which you buy almost every day in the week. Some of them are essentia] and others are not, but all will bear the increased sales tax rates “. The genern-1 sales tax rate is to be increased from 8-A per cent, to 12i per cent, and the increases on commodities regarded as being least, essential will vary from 20 per cent, to 66pf per cent. All Opposition senators are opposed to these sales tax increases. What will these increases mean to the people? They will mean that the worker whose wife is already harassed by excessive costs will be committed to even greater expenditures in maintaining his home.

Sitting suspended from 5~k5 to 8 p.m.

Senator NASH:
WESTERN AUSTRALIA · ALP

– As I have already said, the Australian housewife is groaning under the burden of the high cost of living, and the proposal of the Government to increase the sales tax from S:’. per cent, to 663 per cent, will seriously aggravate the position. Incidentally, I notice that the Government expects to raise £35,000,000 from the increased sales tax. However, the increases of general taxes and sales tax must inevitably result in a higher cost of living, with a corresponding reduction of the purchasing power of the people. The consequence will be that the basic wage will have to be increased again, and there will be a further deterioration of the value of the £1. I cannot help reminding the present Government that it fought the 1949 election on a pledge to restore value to the £1 and to make the lot of the Australian housewife a little less difficult. Of course, we know what has happened since.

From 1949, when the present Government, assumed office, the economic condition of the country has become progressively worse although wages have continually increased. The average weekly wages bill for the quarter ended December, 1949, was £22,701,000. For the quarter ended March, 1951, it had increased to £27,603,000. In other words, under this Government the national wages bill increased by £4,902,000 in a period of fifteen months. That is a very considerable step along the road to inflation. During the quarter ended December, 1949, the average weekly wage paid to adult males throughout Australia was £9 14s. a week, but for the quarter ended March, 1951, the average wage had increased to approximately £11 6s. a week. That is an indication of the losing fight that the wage-earners of this country are waging in their endeavours to keep up with the spiralling cost of living.

The costs of the average householder, measured by the retail price of food and groceries in the six capital cities, increased from the index figure of 1670, for the quarter ended December. 1949, to 2203 ‘for the quarter ended June, 1951, which represents an increase of 533. The rent of a four or five roomed house rose from an index figure of 1062 for the quarter ended December, 1949, to 1.087. for the quarter ended June, 1951, which is an increase of 25. Although that increase may not appear as startling as the other increases I have mentioned, we must remember that some States still retain control of rents, and that fact, no doubt, accounts for the comparatively moderate increase of rents. The “ B “ series index, which shows the combined cost of food and rent, indicates that for the quarter ended December, 1949, the index figure was 1404, and that for the quarter ended June, 1951, it had increased to 1752, which is an increase of 348. During the same periods the index figure for clothing increased from 2606 to 3357, which is an increase of 751 and the cost of miscellaneous articles increased from 1436 to 1710, which is an increase of 284. The “ C “ series index figure, which cover the combined costs of food, clothing, rent and miscellaneous articles, shows an increase from 1653 to 2067, or an increase of 414. I think, that those statistics prove conclusively that the present Government has made no attempt whatever to arrest inflation.

Honorable members on this side of the chamber have repeatedly urged upon the Government the necessity for ascertaining from the people by referendum whether or not they would be agreeable to the Commonwealth resuming control of prices in this country. Although that request has received the unanimous support of members of the Opposition it, has been contemptuously rejected by the Government. In fact, the Prime Minister (Mr. Menzies) went so far as to make the inane statement that prices control is only a method of recording the increase of prices. That, indicates the degree of practical sympathy of the present Government with the people of Australia in their economic trials. The proof of the pudding is in the eating, and the budget introduced by the Government, which was flatteringly described by its supporters, as having been designed to prevent inflation, will inevitably aggravate acutely the present inflationary trend. Although the Government seeks to defend its determination not to introduce prices control by claiming that such control is ineffective, the fact remains that during the war years, when prices control was administered by the Australian Government, prices were kept to within 23 per cent, of the pre-war figure, and it was not until after the referendum in 1948, when the people decided that such control should no longer be administered by the Commonwealth, that the cost of living really got out of hand. I believe that to-day the people of Australia would welcome an opportunity to express their opinion about whether Commonwealth prices control should be re-introduced.

Labour does not claim that prices control is a cure for inflation, but we do contend very seriously that the reintroduction of such a control would act as an effective curb on increasing prices. Whether or not prices control should operate is not a matter that the Government should determine arbitrarily; it is a matter for the people themselves to decide. As all honorable senators are aware, the Government very recently conducted a referendum on a certain matter, and I expect that the cost of that referendum will exceed £200,000. What earthly justification had the Government for failing to place before the people for determination at that referendum the matter of the re-introduction of Commonwealth prices control? Certainly, no greater expense would have been involved in the conduct of the referendum if that course had been followed.

The Government has gone to extreme lengths by proposing to increase the sales tax on certain classes of goods from 8-J per cent, to 66§ per cent., and I cannot refrain from pointing out that in its anxiety to obtain additional revenue the Government is prepared to capitalize even on ice creams and pop corn. Apparently it is not prepared even to permit children to continue to enjoy ice cream, which has become almost a universal food in this country. If honorable senators will reflect for a moment on the incidence of the increased sales tax on ice cream they will realize how hard the parents of young children will be hit. Every parent who sends his child to a Saturday afternoon picture show likes to give bini a few pence to spend on ice cream and pop corn. Imagine the effect of this punitive sales tax increase on poor parents ! Of course, there might be some justification for the proposal to levy such a heavy impost on ice cream if it were intended by that means to divert more whole milk into the production of butter and cheese, but we know that that is not the intention, and that the Government is not in the least concerned about the alarming decline of dairy production.

The statistics of the factory production of butter are significant. In December, 1949, the quantity of butter produced was 21,329 tons. By July, 1951, the monthly production had declined to 7,017 tons, a decrease of 14,312 tons. Incidentally, when I was in Goulburn a few days ago I was amazed to discover that cheese is unprocurable in that large provincial town. Perhaps the following statistics of cheese production explain the reason why. The production of that commodity in December, 1949, was 6,612 tons, but by July, 1951, it had declined to 2,131 tons, which is a decrease of 4,081 tons… The production of processed milk in December, 1949, amounted to 14,389 tons, but by July, 1951, it had declined to’ 4,746 tons, which represents a decrease of 9,643 tons. Those statistics indicate an alarming state of affairs. It is abundantly clear that the dairy farmers of this country are profoundly dissatisfied, and that in preference to continuing to produce milk they have diverted their activities to other phases of primary production.

Senator Spicer:

– Why not tell Mr. McGirr about that?

Senator NASH:
WESTERN AUSTRALIA · ALP

– Never mind Mr. McGirr. Honorable senators opposite know what is going on, but they lack the courage and tenacity to deal with the situation that is developing. This Government’s sales tax increases will kill Santa. Claus. Not many years ago when Labour was in office, a certain Minister was accused of having killed Santa Claus by introducing certain war-time controls. The position then was grossly misrepresented by Labour’s political opponents; but there cannot be any doubt whatsoever that this budget will kill Santa Clans. For instance, the tax on toys, parts of toys, Christmas stockings, and Christmas crackers is to be increased by 33-J per cent.

Senator Kendall:

– Hear, hear !

Senator NASH:
WESTERN AUSTRALIA · ALP

– 1 hope that the honorable senator has a large family for which to buy Christmas presents. All parents like to be able to provide Yuletide gifts for their children. Even without the additional impositions envisaged by this budget, toys are extremely dear. Recently, in a certain town, I saw a little dressed doll priced at the extortionate figure of £2 5s. A slightly larger one was marked £7. Under the Government’s taxation proposals, those prices will be considerably higher. How can the average working class parents afford to pay such charges in addition to the already high prices ruling for every-day commodities? A joint of meat costs £1; a pair of shoes costs £2 10s. or £3, and the price of all clothing is out of all proportion to its value. The Minister for Repatriation (Senator Cooper) said this afternoon that all members of the Government parties were in accord with the budget proposals. Apparently they are conniving in the Government’s attempt to end the age-old British custom of exchanging gifts at Christmas-time to give our children some conception of the meaning of Christianity. Why place this added burden on working class people?

The budget provides for the raising of the astronomical sum of £1,041,500,000. 1. do not believe that all that money is really required. Only about one-sixth of the estimated expenditure for the current financial year will be on defence preparations. The rest will be devoted to ordinary requirements. Governmental expenditure is increasing beyond all reason. This budget is unprecedented in our political history, lt is staggering for n peace-time budget. Even in the most dangerous years of the war, no attempt was made to collect such a huge sum of money. ‘Undeniably, the people of Australia will be over-taxed. They will be deprived of at least £114,500,000 more than the Government really needs to meet its requirements. Surely the aim of every government should bo to provide the maximum services to the community nl. th p. minimum cost. In framing this budget the Government has shown a complete ignorance of psychology. In the past, budgets have been balanced, or, at the end of the financial year, there has been a deficit which has been financed by loan money or by issuing treasurybills. The Minister for Repatriation has said that the Government does not intend to use treasury-bills. That may be sound finance; but deficits have to be made up somehow. The last Commonwealth loan was under subscribed by £7,000,000. although every loan floated by the Labour Government, during the war and in the post-war years was oversubscribed. Surely that is a clear indication that the people of this country have.no confidence in this Government’s economic policy. It is inconceivable that with so much money in circulation and savings bank deposits at such a high level a loan of a paltry £40,000,000 should be undersubscribed. The Government proposes shortly to issue another loan for a similar amount. I wish it, every success. I do not like to see government loans fail, but it seems obvious that the people of Australia have little faith in this Administration. The Minister for National Development told ns that the estimated surplus of £114,500,000 would be put, for the time being, where it could do the least harm, but we all know that that money will be expended by the Government instead of by the people to whom it rightfully belongs. Unlike the wool tax prepayment, the budget surplus will not be returned to the people from whom it was collected. It will be confiscated by the Government. The Minister said that the surplus would be put into the National Debt Sinking Fund, invested in Commonwealth and State loans, and used for repurchases and redemptions of debt, including debt owing to the central bank. The surplus will be, in effect, a compulsory gift upon which the Government will not pay any interest. Surely this is a. new technique in government finance. It will be most interesting to learn how much of the estimated surplus remains at the end of the financial year.

Let us compare this budget with two budgets brought down by Labour governments. In 1944-45, at the height of the war, the budget totalled £653,000,000. In 1944-45, revenue from all sources was estimated at £325,000,000, leaving £32S,000,000 to be raised by loans and other financial measures. In 1946-47, the first post-war year, the budget was £3S5,000,000, of which an estimated deficit of £59,000,000 was to be financed from loan funds. War expenditure in the 1944-45 budget totalled £505,000,000 and ordinary expenditure £148,000,000. In 1946-47, defence and post-war charges were estimated at £221,000,000, and other expenditure, £223,000,000. In the budget now before us, however, although six years have passed since the war ended, provision is made for the. expenditure of £181,000,000 on defence, £107,000,000 on war repatriation services, and no less than £637,900,000 on ordinary governmental services.

Senator Kendall:

– What about the increasing social services bill?

Senator NASH:
WESTERN AUSTRALIA · ALP

– The Government does not expend money only on social services.

Senator Kendall:

– Why not give us a true picture?

Senator NASH:
WESTERN AUSTRALIA · ALP

– I am giving a true picture, and the honorable senator does not like it. Compared with ordinary expenditure of £148,000,000 in 1944-45”. and £223,000,000 in 1946-47, the Government proposes to expend £637,900,000 in the current financial year. That is most difficult to understand. Civil expenditure in this budget represents an increase of £414,900 over the estimate for 1946-47. During the financial year which ended on the 30th June, 1951, £1,501,545 was expended on international development and relief. Provision is made in this budget for an expenditure of £9,906,000 for the same purpose, including expenditure of £8,750,000 under the Colombo plan. During the last financial year £1.1.S17,660 was expended on immigration. The estimated expenditure on immigration this financial year will be £11,791,000. Because supply is unable to keep pace with demand, I contend that there should be an easing clown of our immigration policy. Expenditure on international development has risen tremendously. Although that expenditure is of great value to people of overseas countries, it is to bc incurred at the expense of the taxpayers of Australia. It is apparent that the Government should do more for our own indigent citizens. Ample justification exists for more mature consideration to be given to these proposed expenditures. As honorable senators are aware, we have been this year engaging in jubilee celebrations. I quite agree that we should suitably celebrate a great event in the history of this country, and in that regard I would not be a skinflint. However, the celebrations have been on a somewhat lavish scale as the total expenditure on them has been £268,567. I do not consider that such a large expenditure for that purpose was entirely warranted. 1 consider that the arrangements in connexion with some of the jubilee functions were unnecessarily extravagant.

In this record peace-time budget, onesixth of the expenditure will be on preparations for war and the remainder on normal, governmental activities. When the Minister for National Development (“Senator Spooner) brought down the budget he stated -

In n review of the economic situation., it is stated, that the recent steep rise in prices and routs hears witness to the acuteness of the problem of inflation.

That is wonderful ! Indeed, the Minister’s opinion was on all fours with the advice that the Opposition has tendered to the Government many times since it came to office. The Minister made no comment about the unwillingness or ineptitude of the Government to endeavour to prevent such a situation from developing. He also stated -

Tin: problem of inflation must bc mastered if our defence effort and our developmental plans aru to be carried through and our standards of living preserved.

That is akin to the Minister locking the stable door after the horse has bolted. The trouble is that the inflationary tendency has been increasing steadily; in effect, the Government has allowed the horse to get away. I do not know on which horse supporters of the Government had their money, but the fact remains that they were on a loser. The Minister continued -

In broadest terms, the main remedy for inflation consists in closing the gap between the money demand for goods and the supply of goods. . . . The time has come to impose effective restraints on money demand for goods and on .the indiscriminate production of less essential goods.

In furtherance of that aim the Government proposes to draw off the spending power of the people by budgeting for a surplus of £114,500;000. In other words, it will confiscate that amount. It proposes to increase general taxation by 10 per cent, all round. By increasing the rates of sales tax it proposes to obtain additional revenue of £35,000,000. The Government’s policy can result only in reduced purchasing power, higher costs for goods and services, and further increases of the basic wage. This is a negation of the promises that the Government parties made to the people on the hustings.

We hu ve heard a great deal from Government senators about the restriction of credit for the production of less essential goods. By deciding which are essential and which are non-essential goods the Government is interfering with industry. Much has been heard about socialism. As a result of legislation that was enacted by the Parliament a short while ago, the direction of money and materials will be in the hands of the Government. In other words, the Government will determine which industries shall carry on. The result will be the economic direction of labour in this country. That constitutes interference with the mode of living of the people and will result in the dislocation of home-life, because, inevitably, unemployment will result. This is another instance of the Government breaking its pledges to the people of Australia. I recollect supporters of the Government stating, during the general election campaign, that they would not have socialism, that there would be no direction of labour, and that free enterprise would be encouraged. Yet the Government proposes to do what honorable senators opposite criticized Labour for doing when in office. The Government now realizes that its laisser-faire policy has resulted in inflation getting almost beyond control. Now, in an effort to overtake the position that has developed, the Government has introduced this extraordinary budget. In effect, the budget can be described as an effort by the Government to introduce a planned economy by the direction and control of money, industry, material, and man-power in a time of peace. Six years after the termination of World War II. there is no evidence that supply is catching up with demand, although governmental expenditure is increasing by leaps and bounds.

There is a real necessity for the re-establishment of the Public Accounts Committee as an all-party body to investigate proposed governmental expenditure. The need for such a body is greater to-day than everbefore. Had Labour brought down a budget such as this is it would have been condemned throughout Australia. Such a budget is being suffered and tolerated only because of the absence of any indication of the Government’s intention to interfere with vested interests. The Government has abandoned its proposal to impose a tax on excess profits, although company profits are greater to-day than ever before. Public companies will be required to pay a special levy of 2s. in the £1. The Government expects to derive additional revenue of £28,000,000 in this way. Honorable senators should compare this proposal with the proposal to obtain additional revenue of £72,000,000 by increased income tax and a further £35,000,000 by increased rates of sales tax. The type of tax that is favoured by this Government is obvious. The Government parties promised to reduce taxes. This is another instance of their failure to keep promises. Although, after six years of peace it would be reasonable for the people of this country to expect reduced taxation and lower governmental expenditure, such reductions have not materialized. Expenditure has increased alarmingly. Public servants have been retrenched, Commonwealth loans have been undersubscribed, and resort has been had again to overseas borrowing. There is a general feeling of uncertainty about the stability of this country. The Sydney Morning Herald, a newspaper not unfriendly to the opponents of Labour; has criticized the budget in these words -

Budget not only thoroughly unsound economically but an immense political blunder . . . Government, admittedly, has had tremendous economic problems to face; but in its 21 months of office it has done little hut allow them to grow larger.

I consider that that newspaper summarized the position accurately. This budget contains no ray of sunshine or hope that the position is likely to improve. It does not contain any constructive proposals, and does not provide any incentive for increased production. As a result of the budget the costs of industry will increase, with a consequential increase of the cost of living. The workers are to be taxed, both directly and indirectly, to a greater degree than formerly. If the Government sincerely desires production to be increased, why does it not offer, as an incentive, a remission of taxes when increased production is achieved?

The PRESIDENT:

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

Motion (by Senator Armstrong) put -

That Senator Nash be granted an extension of time for thirty minutes.

The Senate divided. (The President - Senator the Hon. Edward Mattner.)

AYES: 20

NOES: 31

Majority . . 11

AYES

NOES

Question so resolved in the negative.

Senator PEARSON:
South Australia

– I intend to support the budget proposals, but as I understand that it is desired that other business shall be introduced at this stage I ask for leave to continue my remarks.

Leave granted ; debate adjourned.

page 631

MIDDLE EAST

Senator O’SULLIVAN:
Minister for Trade and Customs · Queensland · LP

– -by leave - read a copy of the statement delivered in the House of Representatives by the Prime Minister (Mr. Menzies) (vide page 673), laid on the table the following papers : -

Australia and the Egyptian Situation - Ministerial Statement, 16th October. 1951.

Text of proposal for the establishment of an Allied Middle East Command transmitted to the Egyptian Government on 13th October, 1951, by the Ambassador of the United Kingdom in Egypt and moved -

That the papers be printed.

Debate (on motion by Senator McKenna) adjourned.

page 631

QUESTION

ESTIMATES AND BUDGET PAPERS 1951-52

Debate resumed.

Senator PEARSON:
South Australia

– The budget is an important document which is always subject to criticism by those inside the Parliament, and also by those outside it. Members of the public are naturally concerned with any budget presented by any Treasurer in any parliament because it affects them personally. Criticism of the present budget from outside the Parliament has not been so strong as honorable senators opposite would have us believe. I have some knowledge of what has taken place in South Australia since the budget was introduced, and 1 know it has been well received in thatState by the press, and also by the general public. Indeed, there has been an almost total absence of criticism from the public. In the House of Representatives the story has been somewhat different, and a motion, which amounted virtually to a no confidence motion, was moved by the Leader of the Opposition (Dr. Evatt). I do not know whether the same procedure will be followed in this chamber, but I gained the impression, from an interjection made a little while ago, that it was quite possible. During the budget debate in the House of Representatives I listened in vain to many long speeches from members of the. Opposition for something in the nature of constructive criticism. Speeches by members of the Opposition in this chamber have also been singularly lacking in that, quality. This afternoon. Senator Aylett tried to show how the Government’s proposed expenditure might be curtailed. He spent a good deal of time in condemning the recruiting campaign conducted by Sir Edmund Herring, and he showed that, by destroying the effectiveness of that campaign, it might be possible to save the magnificent total of £3S5,000 !

Senator Nash suggested that the Government should not try to budget for a surplus, but I regard the surplus a? a vital factor in the . budget. I am puzzled by the attitude of honorable senators opposite. First, they say that the Government proposes to collect too much revenue; then, in almost the next breath, they say that expenditure on various items, including social services, should be materially increased. Their attitude is unworthy of His Majesty’s Opposition in the Parliament. Apparently, they refuse to recognize that thi:

Government has certain inescapable commitments. I include among these, payments to the States, £161,000,000, an increase of £33,000,000 over the last year; defence expenditure, £183,000,000, an increase of £33,000,000; payments from the National Welfare Fund, £.138,000,000, an increase of £23,000,000; war pensions, £33,000,000, an increase of £6,000,000; and interest aud sinking fund payments, £66,000,000, an increase of nearly £1,000,000. A comparatively new item is a commitment under the Colombo plan of approximately £S,000,000. The Government is also faced with increased expenditure because of higher wages and salaries, and those increases would have to be met no matter what government was in power. On the Government’s business undertakings, increased wages and salaries account for about £11,000,000. Unavoidable increases of expenditure this year will amount to nearly £120,000,000.” These items represent inescapable commitments that any government would have to meet.

Senator Aylett:

– I agree with the honorable senator.

Senator PEARSON:

– How would the honorable senator raise the money required to meet them? I regret that he did not take us into his confidence and tell us how he would raise it. If he disagrees with the decision of the Government to raise it by increased taxation an obligation rests upon him to tell us how otherwise the money could be raised. After a very close scrutiny of Commonwealth expenditure the Treasurer (Sir Arthur Fadden) decided to budget this year for an expenditure of £927,000,000. If taxes had been levied at existing rates, collections for this financial year would approximate £8S.1.,000,000, leaving a deficit of approximately £46,000,000. Even if taxes were increased to yield that additional amount the Treasurer would still only achieve a balanced budget. I say most emphatically that in present circumstances a balanced budget is not sufficient to meet our requirements.

I have reached three inescapable conclusions. The first is that under present conditions it is basically sound - indeed it is imperative - that we should plan, not merely for a balanced budget, but for :i surplus in the accounts of the nation. Secondly, if such a surplus is to be achieved it is obvious that substantial increases of taxes of one kind or another must be embarked upon. Thirdly, under existing conditions, to bridge the gap between anticipated requirements and tinrevenue that we would receive if i In rates of taxes remained unaltered by recourse to the issue of bank credit, would be utterly reprehensible. I commend the Government for having rejected the suggestion that additional revenue should bc raised in that way. What better mean-: could be employed to increase the problem of inflation than suddenly to add to tinalready top-heavy purchasing power of the community an additional £46,000,000 at a time when the supply of goods is insufficient to, meet demands? I congratulate the Government on having rejected such a suggestion. From the remarks made by Senator Nash I suspect that lie favours recourse to the issue of bank credit as a means of meeting our additional financial requirements. If that be so he should stop talking about putting value back into the £1.

Senator NASH:
WESTERN AUSTRALIA · ALP

– Not at all.

Senator PEARSON:

– Apparently I have failed to make myself clear to the honorable senator. If the Government, issued bank credit to finance its additional commitments it would take an action that would have a highly inflationary effect. The issue of bank credit for that purpose would merely aggravate the problem of inflation. In a period of inflation it is imperative that governments, as well as individuals, should pay their way. The Government has resolved to pay its way a-nd, in addition, to put something into the “kitty” for a rainy day. At a time such as this it is desirable that governments as well as business executives and private individuals should attempt to achieve a surplus of income over expenditure. I may be old-fashioned, but I do not think tha.t I am far wide of the mark when I say that it is just as necessary for governments to endeavour to achieve a handsome surplus as it is for the ordinary individual so to do.

The two honorable senators who preceded me referred to the necessity of adhering to the Government’s agreement with the States to finance their loan programmes. Honorable senators know that at the recent meeting of the Loan Council, the Commonwealth agreed to underwrite the loan programmes of the States aggregating £225,000,000. The underwriting of State loans by the Commonwealth may be a new departure in governmental finance, but it is undoubtedly the right course to follow in present circumstances.

Because of circumstances that are not associated in any way with matters mentioned by Opposition senators it is apparent that during this financial year the loan market will not be sufficiently buoyant to provide the £225,000,000 required by the States to finance their loan programmes. If that be so, and the Commonwealth is required to underwrite State loan programmes, which have already been drastically reduced by the States themselves, who in this chamber will say that the requirements of the States should not be met by the Commonwealth? I give Opposition senators credit for having said that the States should be helped to implement their public works programmes. I cannot but suggest that Opposition senators generally have adopted a destructive attitude towards the States. They believe in unification, which means the destruction of the States. We had an instance of that attitude, this afternoon when Senator Nash suggested that one effective means of avoiding undue Commonwealth spending would be to avoid expenditure related to the requirements of the States. I entirely disagree with him. Will any- honorable senator contend that the amount of money which the Commonwealth has guaranteed to the States should not, if necessary, be provided from surplus moneys in the hands of the Government resulting from increased taxes? In view of the trouble that has occurred in connexion with the lean programme in Victoria I do not believe that any representative of that State would question the wisdom of backing Victoria’s loan programme to the fullest degree.

Who will cavil at the proposal in this budget to expend £183,000,000 on defence? The expenditure of that amount of money would fall far below the level of defence expenditure in Great Britain and the United States of America. Until recently the United States was an isolationist country uninterested in affairs outside its own borders. That country has now completely revised its defence policy, and is now expending huge amounts of money in preparation for a war which it hopes, as we do, will not eventuate. Great Britain under a socialist government is also preparing feverishly for a world conflict, hoping that it will not occur. Is the Opposition in this Parliament on all fours with the Prime Minister of Great Britain in this matter? Should another world conflict break out those Opposition senators wlm cavil at the Government’!? defence proposals will have no right to go on bended knees to the United States of America and ask that country to send conscripts to Australia to defend us against an aggressor as it did during World War II. We must make every effort to place our defences on a sound footing.

I do not think that any honorable senator will question the amount thar has been provided in the budget for expenditure on social services. Indeed, Opposition senators have suggested that expenditure on social services should be increased. We should like to agree with them, but we realize that any extension of social services will impose additional burdens on the revenue. This Government may well be proud of what it has done for the deserving people in our midst. In order to meet our obligation? for defence and the requirements of the States we must of necessity increase taxes.

Senator Nash went to great pains to criticize the sales tax proposals in the budget. He has accused us of killing Father Christmas for the second time ! He has criticized the Government for having increased the sales tax on dolls. No one, least of all honorable senators on this side of the chamber, likes to increase sales tax on any commodity! I ask Opposition senators where in Heaven’s name will the additional revenue that we need come from unless it pomes from increased taxes?

Senator Ashley:

– Ask Artie “.

Senator PEARSON:

– The Treasurer, to whom the honorable senator has obviously referred, has told us how he proposes to raise the additional revenue he requires. The onus of answering my question lies on Senator Ashley and his colleagues. It is interesting to note that, although the taxation proposals of the Government in this budget have been trenchantly criticized by Opposition senators, Australian taxpayers will still pay less than taxpayers on similar incomes in New Zealand and the United Kingdom. We can take the incidence of tax on any income we like and compare it with the tax on the corresponding income in New Zealand or the United Kingdom and we shall find that the rates in this country are lower.

Senator Aylett:

– Would not the honorable senator expect. the New Zealand rates to be higher under the present reactionary government in that country?

Senator PEARSON:

– The Australian tax rates are lower even than the rates that obtained in Now Zealand under the previous Labour Government in that country. Speaking generally, I think that the Australian Government is wise in not imposing any added discriminatory burden on any particular section of -the community. It is all very well to advocate loading the increased tax against particular sections of the community, but any such action would defeat its own end.

I should like now to reply to the contention expressed by one honorable senator opposite to the effect that the imposition of an additional tax of 10 per cent, on all incomes is unfair to those in receipt of lower incomes, and is opposed to the accepted principles of taxation in this country. I point out to the honorable senator that all that the Government proposes to do is to increase all the previous rates of income tax by 10 per cent. As the previous scale wa.s a graduated one, the actual rate of tax levied on those in receipt of large incomes will be much higher than that levied on those in receipt of small incomes.

The Treasurer has said that this budget is really a tax on spending rather than n tax on income, and I believe that that is a wise course to pursue at present.

Indeed, I congratulate the Government on its budgetary proposals. All spending, not only by governments but also by individuals, must be curtailed. We must not only reduce the amount of money expended by humble people, but we must also ensure that the wealthiest man in the community makes a corresponding reduction in his expenditure. Although a great deal has been said by members of the Opposition in recent months, and particularly during this debate, about the desirability of reintroducing prices control by the Commonwealth, I point out that prices control is not in itself a remedy for inflation.

Senator Courtice:

– Nobody has said that it is.

Senator PEARSON:

– The fact remains that the reintroduction of prices control is the only suggestion put forward by members of the Opposition. We 3ay that prices control, regardless of whether it is administered by the Commonwealth or by the States, is ineffective in restraining inflation. In reply to Labour’s suggestion that we ought to take a referendum on the subject, I remind them that only a few years ago a referendum was taken on it, and the people decisively rejected Commonwealth prices control. How often does the Labour party want us to hold such referendums? I have not heard any sound reason adduced to suggest that the people have altered- their minds since that referendum was taken.

Senator Aylett:

– Did the honorable senator notice the result of the recent Gallup polls on the subject?

Senator PEARSON:

– But how correct was the Gallup poll forecast of the actual result of the recent referendum on communism ? We say that prices control is ineffective, irrespective of the identity of the government that administers it, and at its best, it is a negative approach to a most difficult economic problem. After all, prices control is merely profit control, and it is not a corrective. At the same time I desire to make it quite clear that I am not opposed to a measure of prices control to arrest inflation.

In my view, what is needed more than anything else is increased production of basic primary and secondary goods. It is paradoxical that the goods that are in shortest supply in Australia to-day are those which we are so well able to produce, such as coal, iron, cement, timber, sulphur and fencing materials. Our depleted primary production is characterized by a most acute shortage of dairy products and of meat. Furthermore, and amazingly enough, we are also confronted by an acute shortage of wheat. The real cure of inflation lies in the production in this country of an abundance of the goods that we can produce. The need for increased primary production is particularly urgent because, in addition to feeding ourselves, we owe a duty to the starving peoples of the north, whose state of semi-starvation presents a constant, menace to our prospects of future survival. Unless we produce sufficient to feed those unfortunate people now, they may well turn on us in their wrath a few years hence. Whether we are trade unionists, employers, business executives or government servants, our duty is to do more in the national interest, and everyone must realize that increased production can be achieved only by increased labour. I commend to the attention of honorable senators the words of a great American who said: “We are more heavily taxed by our own idleness, crime and folly than by any government “. That observation is worth thinking about to-day. The greatest tax imposed on Australians to-day is that which we impose on ourselves. Idleness, goslow tactics, limitation of production, the darg, hoarding of goods and withholding of supplies are all self-imposed taxes. In the light of present-day circumstances, industrial stoppages are a luxury that we cannot afford. I draw attention particularly to a statement made by Mr. Len Clarkson, who recently retired from the position of president of the Adelaide Chamber of Commerce. Mr. Clarkson said -

Two steps are essential to stabilize our economy and maintain our living standards. The first step is to wipe out the influence of the Communist party who for 30 years have advocated inflation and industrial disruption as a. prelude to revolution.

The second step is for all of us to recognize the truth of the time worn but now somewhat unpopular slogan, “ A fair day’s work for a fair day’s pay” - this is not only demanded from the so-called worker but is the obligation of every employer, every executive and every Government official in this country.

N’o problem ‘ to-day is so great us that of intiation and no responsibility as exacting as that of trying to solve it and the work cannot be left entirely to the Government.

Industry, whether primary, secondary, or tertiary, can best serve its day and generation by asserting its independence, increasing its efficiency, examining its own shortcomings, and endeavouring to avoid the faults which it so readily condemns in Government and other spheres.

No Government can stop inflation or prevent a depression without the full co-operation and understanding of every section of the community.

I put that forward as being a statesmanlike utterance.

Senator BYRNE:
QUEENSLAND · ALP; QLP from 1957; DLP from 1968

– Does the honorable senator believe that this budget merits the confidence of the people and that the Government will obtain their cooperation?

Senator PEARSON:

– I believe that, the budget does merit the people’s confidence and that the Government has, and will continue to retain, their confidence. We cannot legislate our way out of inflation. We cannot wish our way out. We can only work our way out of it. I realize, of course, the unpopularity that comes from expressing such sentiments. Incidentally, I cannot refrain from saying that in my opinion the failure of the people to agree to the Government’s proposals at the recent referendum denied us a great opportunity to destroy the greatest menace to production in this country.

Senator Ryan:

– Apparently the peoplethought otherwise.

Senator PEARSON:

– I do not agree that the people took that view at all. They were side-tracked by a lot of specious arguments and misleading propaganda.

I conclude by making a more detailed reference to primary production. As a result of the visit overseas of the Minister for Commerce and Agriculture (Mr. McEwen) there is every hope that the incentive of primary producers in this country to increase production will be restored. The price of wool is somewhat lower than it was formerly, and the increased price of meat should encourage the raising of stock for meat. Although primary producers may derive some benefit from the agreement that the Minister is at present negotiating with the United Kingdom Government, I believe that the time has arrived when the Government should seriously consider abandoning the present system of government to government contracts. It is time that we reviewed that policy with a view to reverting to direct trading between the interests concerned in out two countries. Since I feel sure that there will be a change of government in Great Britain in the very near future, I think that it may be possible for the present Australian Government to change the present system of government-to-government trading, which is destructive of the incentive to produce.

I am glad that the Government is confronting the difficult matter of fixing a fair home-consumption price of wheat for stock feed. I know that that matter has worried Australian wheat-growers foi” some time. No one complains about the basis on which wheat is made available for home consumption, as flour in this country.

Senator BYRNE:
QUEENSLAND · ALP; QLP from 1957; DLP from 1968

– How much does it cost to produce a bushel of wheat?

Senator PEARSON:

– I accept the figures adopted by the appropriate advisory body as being a fair estimate of the cost. The- wheat industry generally accepts the figures as being a fair assessment of production costs. They are reviewed from time to time, and I have not heard them challenged by any organization of wheat-growers or by any individual wheat-growers. What alarms the wheat-growers most is the price at which they are compelled to sell their product for stock feed, large quantities of wheat are used to feed poultry, pigs, and, during periods of extraordinarily high wool prices, sheep. No wheat-grower should be expected to subsidize another primary industry which is more lucrative than the one in which he is engaged. I shall not discuss this matter at length because it is at present the subject of negotiations between the Australian Government and the State governments. I believe that the’ steps which have already been taken will go far towards solving the problem. I congratulate the Government upon its decision to subsidize, in part at least. the increased cost of wheat sold to poultry-farmers so that the price of eggs te the public generally may be kept at a reasonable figure.

The budget is sound and has been accepted by the majority of the people. Even the trade unions have accepted it if one is to judge by the lack of criticism that has been forthcoming from that source. I am confident that, before the year has ended, the budget will have started to have some effect on the problem of inflation with which we are all so much concerned. This year, the people of Australia will be not only paying their way but also building up a surplus which I believe to be a wise move, and I have no doubt that when the effects of the budget become apparent, the electors will have every reason to congratulate the Government upon its financial policy.

Senator CRITCHLEY (South Australia) 9. 57]. - I regret that I cannot share Senator Pearson’s enthusiasm for the budget, although, he is a fellow South Australian. I can quite understand his reaction to the reception given to the budget by the South Australian press. All honorable senators are aware of the hostile criticism which the budget evoked in the press throughout the Commonwealth. True to form, the South Australian newspapers were very mild indeed, and Government supporters should be thankful indeed that they had such a merciful press at the time when they were deserving of the severest punishment. The honorable senator said that he had not heard any constructive criticism of the budget. All budgets are of course criticized in some measure. But who is to say whether criticism is constructive or destructive? There are some taxpayers who grumble at all budgets. I agree with Senator Pearson that some of the commitments for which provision is made in the budget are inescapable, and would have to be met by whatever government held office, but I do not agree with some of the methods that the Government proposes to adopt to give effect to its budget proposals. Am I to accept Senator Pearson as an authority when he says that my criticism of the budget which j of course, it is not in accord with his own views, is not constructive? The honorable senator referred also to Commonwealth grants to the States. Those grants are most necessary and later I propose to draw attention to one avenue through which I believe the States could be given more assistance than they are receiving at present. In spite of the constant criticism of the uniform income taxation system under which the Commonwealth is the sole collector of income tax and makes annual reimbursements to the States, I do not think that any State government would advocate a return of the old days of independent taxing authority. Certainly the smaller States have no such thoughts, much as they may criticize the size of the grants that they now receive.

I am sure that Senator Pearson does not. conscientiously believe his statement that Labour supporters consider the restoration of Commonwealth prices control to bc the panacea for all our economic ills. During the prices referendum campaign in 194S, the Labour party supported the Commonwealth prices control merely as a step in the right direction, and not as an end in itself. However, the people cast a negative vote, due largely to the propaganda spread by the anti-Labour parties. Senator Pearson deplored the defeat of the recent referendum on the banning of the Communist party. On that issue too we must agree to differ. I shall not criticize the vote of the Australian people who have the most democratic franchise in the world, but just as Senator Pearson agreed with their decision in 194S. so I agree with their decision in 1951. Senator Pearson said he was thankful that, at the end of this month, there would be a change of government in Great Britain. In my opinion, that would be a tragedy, because it would be followed by a more rapid destruction of Britain’s economy than has occurred in this country in the last twenty months. I cannot find any consistency in. the attitude of members of the Government. On the 16th September, 1948, the present Minister for Trade and Customs (Senator O’Sullivan), who was then acting Leader of the Opposition in this chamber said -

That many essential goods are still in short supply is undeniable.. An examination of figures provided by the Com mon wca 1th Statistician shows that .there has been a decline in unit production, particularly in primary industries. There may have ‘been some shortagesin pre-war years due, perhaps, to seasonal conditions or to droughts, but the truth is that to-day, unit production is considerably less, mainly because high taxes have destroyed incentive to produce. Whether or not thai attitude is commendable, the facts must be faced. We all know that there is a widespread feeling abroad - “ Wl,V work for Chifley? I’ve had it”.

If the Minister was justified in condemning the Labour Government’s budget in 194S, and saying “ “Why work for Chifley?”, are we on this side of the chamber not equally justified in saying to-day. “ Why work for Menzies and Fadden ?”. Surely honorable senators Opposite have changed their views in a remarkable fashion. The Chifley budget to which the Minister for Trade and Customs referred may have been harsh in some respects, but the then government had certain obligations to the people of this country. It was concerned, for instance, with the re-establishment of exservicemen, the reduction of the national debt, and the granting of financial assistance to Great Britain. Later in thsame speech, the Minister said -

The Treasurer says to the taxpayers, “ A tax reduction will lead to inflation”. What lie really means is. i: You earn the money, and T will, spend it because, if you spend it. there will be inflation, whereas if I, the Treasurer, spend it there will not be inflation “. The people are tired of allowing a prodigal Treasurer to spend their hard-earned money.

What a change of front ! I cannot quote any remarks made by the present Minister for Repatriation (Senator Cooper) on that occasion because he was enjoying a respite from his Parliamentary duties and I say in all sincerity that his trip overseas was well-earned, but on the 5th October, 1949, when Leader of the Opposition in this chamber he said -

The budget holds out no hope to the harassed housewife, or the community in general, for any reductions of the cost of living or of the prices of building materials and other important commodities. . . .

In conclusion, T say that the budget can only be described as depressing and unimaginative. It does not indicate how the Government intends to overcome the acute shortage of essential commodities, or to arrest the continuous rise in the cost of living.

Those statements by the present Minister for Trade and- Customs and the Minister for Repatriation are in direct contradiction of the views that they now express. How opinions can be changed with such apparent ease and lack of conscience I do not know.

The Government claims that this budget will help the majority of the Australian people, but because it ignores completely the fact that poverty will result from its proposals it is unsound. I realize that it is essential that the Government should obtain all the revenue that it requires for the purposes of government but the Government cannot expect the people’s co-operation unless it acts logically and fairly. One does not require any more than an ordinary amount of grey matter to realize that, despite social services benefits, workers in the lower income groups will be penalized by the Government’s taxation proposal. From my own experience, I know that it does not fa.ll to the lot of many people to graduate to the higher income groups. To contend that a general increase of taxes by 10 per cent, is not a hardship on many people, is altogether wrong. We Australians are a carefree race, but I do not consider that all of the people should be penalized because some of them have strayed from the path of honesty. Very few members of our community are not prepared to pay some regard to the interests of this country and to meet their just obligations. I stress that the imposition of taxation at a flat rate bears very heavily on persons on fixed incomes, and those in the lower income groups generally. It is obvious from the budget proposals that the Government has made no effort to trim its own expenditure, although it it- making heavy demands on the people.

Supporters of the Government have stated that the budget surplus will be utilized for State works. I consider that the proposed 10 per cent, increase of income tax will undermine the strength of the Australian community and reduce the incentive to work. When sitting in Opposition during the regime of the previous Labour Government, the Minister for Trade and Customs (Senator O’sullivan) and the Minister for

Repatriation (Senator Cooper) loudly condemned certain actions of the then government, and stated that Labour was removing the incentive to work. I should like those Ministers to explain their change of attitude on this subject. After international crises there are usually periods of inflation or depression, both of which have been experienced in this country. Until the previous Labour Government was forced to relinquish prices control, the Australian economy was the most stable economy in the world. In the United States of America it became necessary to re-introduce prices control after a short period of freedom from control. Labour’s attitude to this subject has always been that it is impossible to achieve uniform control of prices in this country other than by federal action. The effect of the proposed 10 per cent, increase of incometax will be particularly noticeable in connexion with overtime and spare time work. Increased sales tax and excise will increase the prices to the workers of everyday necessities. This will arouse their resentment, and living costs will rise as a result. f do not consider that adequate provision is made in the budget for expenditure on roads, which have deteriorated considerably during the last few years. Having regard to the shortage of labour [ arn convinced that it is impracticable for local governing bodies and State governments to restore the roads to good order. Honorable senators will recollect that memorable occasion last July when the Senate met on a Saturday.

Senator Spooner:

– That was the day !

Senator CRITCHLEY:

– After continuing the debate on the motion for the second reading of the Defence Preparations Bill for two days, the Government ignominiously caved in and gave honorable senators an opportunity to go out on Sunday morning. In the course of my duties I have travelled extensively over the roads system of South Australia. The fact that many Commonwealth-owned motor vehicles have to travel over roads that are in a bad state of repair is frequently lost sight of. The existing highways were not designed to carry the huge transport vehicles that now use them. In view of the unsettled condition of world affairs to-day, it is imperative that positive steps be taken to restore our roads system to good order, in the interests of defence. That is no less essential for the development of this country. I believe that local governing bodies are unable to cope with this problem alone, and that Commonwealth assistance on a generous scale should be provided.Prior to World War II. the majority of our roads were in good order, but much work now requires to be done to restore them.

I am also concerned about the large volume of water that runs to waste in South Australia from the MurrayRiver. Year after year water is short in Adelaide during the summer months. By the expenditure of money to conserve the water that now flows to waste, this problem could be overcome, and production of food increased. I hope that the Government will give some attention to the two points that I have mentioned, because in my opinion they will play an important part in the development of this country.I ask for leave to continue my remarks.

Leave granted ; debate adjourned.

page 639

HOUR OF MEETING

Motion (by Senator O’Sullivan), agreed to -

That the Senate, at its rising, adjourn to to-morrow, at 2.30 p.m. .

page 639

PAPERS

The following papers were presented : -

Apple and Fear Organization Act - Regulations - Statutory Rules 1951, No. 92.

Canned Fruits Export Control Act - Regulations - Statutory Rules 1951, No. 94.

Coal Excise Act - Regulations - Statutory Rules 1951, No. 104.

Commonwealth Bank Act - RegulationsStatutory Rules 1951, No. 88.

Commonwealth Public Works Committee Act-Twenty-second General Report of the Parliamentary Standing Committee on Public Works.

Commonwealth-Telegraphs Agreement - Commonwealth Telecommunications Board - Interim Report to31st December, 1950.

Conciliation and Arbitration Act - Regulations - Statutory Rules 1951, No. 100.

Customs Act - Regulations - Statutory Rules . 1951, Nos. 99, 106.

Dairy Produce Export Control Act -

Regulations - Statutory Rules 1951, Nos. 97, 102.

Twenty-sixth Annual Report of the Aus tralian Dairy Produce Board, for year 1950-51.

Defence (Transitional Provisions) ActRegulations - Statutory Rules 1951, No. 96.

Distillation Act - Regulations - Statutory Rules 1951, No. 105.

Dried Fruits Export Control Act -

Regulations - Statutory Rules 1951. No. 103.

Twenty-seventh Annual Report of the Dried Fruits Control Board, for year 1950-51, together with Statement by Minister regarding the operation of the Act.

Egg Export Control Act - Fourth Annual Report of the Australian Egg Board, for year 1950-51.

Lands Acquisition Act - Land acquired for -

Defence purposes - Wodonga, Victoria.

Department of Civil Aviation, Defence and Department of the Interior purposes - Western Junction, Tasmania.

Department of Social Services purposes- Jordanville, Victoria.

Immigration purposes -Nunawading, Victoria.

Postal purposes -

Barmera, South Australia.

Carlton, Victoria.

East Brisbane, Queensland.

Eudunda, South Australia.

Glenferrie, Victoria.

Glenunga, South Australia.

Mornington, Victoria.

Tullamarine, Victoria.

Meat Export Control Act -

Regulatious - StatutoryRules. 1951. No. 101.

Sixteenth Annual Report of the Australian Meat Board, for year 1950-51.

National Debt Sinking Fund Act - National Debt Commission - Twenty-eighth Annnal Report for year 1950-51.

Nationality and Citizenship Act - Return for 1950-51.

Nauru - Ordinances - 1951. - No. 1 - Capitation Tax Repeal.

Naval Defence Act - Regulations - Statutory Rules 1951, No. 93.

Norfolk Island Act - Regulations - 1951 - No.1 (Advisory Council Ordinance).

Northern Territory (Administration) Act - Regulations - Statutory Rules 1951, No. 98.

Papua and New Guinea Act- Ordinances - 1951-

No. 28 - Legislative Council.

No. 29 - Supply Ordinance (No. 2) 1951-52.

Pharmaceutical Benefits Act - Regulations - Statutory Rules 1951, No. 89.

Post and Telegraph Act- Regulation - Statutory Rules 1951, Nos. 73,90.

Public Service Act - Appointments - Department -

Postmaster-General’s - P. T. Bason, R. A. Blackman, F. A. Fraser, H. W. Hix, A. R. McK. Langley, R. G. Smart, R. O. Smith, F. H. Thornley.

Repatriation - A. R. Parkin.

Social Services - E. M. Forsyth.

Treasury - B. D. Mickle.

Works and Housing - A. Q. B. Davis, J. D. Edwards, A. L. Miller, M. Murch, N. Sneath, A. H. Wand.

Public Service Arbitration Act - Determinations by the Arbitrator, &c., 1951 -

No. 68 - Transport Workers’ Union of Australia.

No.69 - Commonwealth Medical Officers’ Association.

No. 70 - Postal Overseers’ Union of Australia.

No. 71 - CommonwealthStoremen and Packers’ Union of Australia.

No. 72 - Hotel, Club, Restaurant and Caterers Employees’ Union of New South Wales and Federated Liquor and Allied Trades Employees’ Union of Australasia.

No. 73 - Federated Clerk Union of Australia.

No. 74 - Commonwealth Legal Professional Officers’ Association.

No. 75 - Professional Officers’ Associa tion, Commonwealth Public Service.

No. 76 - Federated Clerks’ Union of Australia.

No. 77 - Transport Workers’ Union of Australia.

No. 78 - Commonwealth Public Service Artisans’ Association.

No. 79 - Federated Clerks’ Union of Australia.

No. 80 - Musicians’ Union of Australia.

No. 81 - Australian Workers’ Union.

No. 82 - Federated Ironworkers’ Association of Australia.

No. 83 - Customs Officers’ Association of Australia (Fourth Division).

No. 84 - Professional Officers’ Association, Commonwealth Public Service.

No. 85 - Australian Workers’ Union.

Nos. 86 to90 - Professional Officers’As sociation, Commonwealth Public Service.

No. 91 - Commonwealth Public Service Clerical Association, Printing Industry Employees’ Union of Australia and others.

No. 92- Amalgamated Engineering Union (Australian Section) and Sheet Metal Working Agricultural Implement and Stovcmaking Industrial Union of Australia.

No. 93- Commonwealth Public Service Artisans’ Association.

No. 94 - Transport Workers’ Union of Australia.

No. 95 - Customs Officers’ Association of Australia (Fourth Division).

Seat of Government Acceptance Act and Seat of Government (Administration) Act- Regulations - 1951 - No. 5 (Fish Protection Ordinance ) .

Wine Overseas Marketing Act- Regulations - Statutory Rules 1951, Nos. 91, 95.

Wool (Contributory Charge) Act (No 1)- Regulations - Statutory Rules 1951, No 107.

Wool (Contributory Charge) Act (No. 2)- Regulations - Statutory Rules 1951. No. 108.

Senate adjourned at 10.26 p.m.

Cite as: Australia, Senate, Debates, 16 October 1951, viewed 22 October 2017, <http://historichansard.net/senate/1951/19511016_senate_20_214/>.

View PDF View XML View in Voyant